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Krungthai Card CEO warns of flat profit growth in 2018 after interest rate rule

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Krungthai Card CEO warns of flat profit growth in 2018 after interest rate rule

Krungthai Card PCL's president and CEO, Rathian Srimongkol, warned of potentially flat profit growth in 2018 as stricter regulations on credit cards and personal loans may impact the company's income, Bangkok Post reported Oct. 11.

The CEO said that the company wants to maintain profit growth, but that the worst-case scenario is flat growth. He added that double-digit growth in 2018 is "impossible."

Rathian's comments follow the implementation of tougher regulations by the Bank of Thailand on Sept. 1 that reduced the ceiling on interest rates for credit cards to 18% from 20% per year for new and existing credit card holders.

Krungthai Card estimates that the new interest rate will reduce its income by 700 million Thai baht for one year. The company looks to cut costs to offset a fall in profit, Rathian said, adding that new technology is one tool the company can use to trim costs.

As of Oct. 10, US$1 was equivalent to 33.23 Thai baht.