Thai banks resilient in Q4 2025 despite declining loans, lower profits, and weak demand.

Thailand's banking sector showed resilience in Q4 2025 despite a sixth straight quarter of loan declines and a 13.5% drop in net profits, driven by weak demand from SMEs and consumers, lower interest income, and borrower support programs. The non-performing loan ratio improved to 2.84% from 2.94%, while banks maintained strong capital, liquidity, and provisions. The central bank warned of ongoing financial stress among vulnerable borrowers amid sluggish, uneven economic growth.