Kasikorn Research Center (K-Research), a subsidiary of Kasikornbank (KBank), predicts lending growth of 8% to 10.5%, down from 10% last year and 14% in 2012.
The forecast is based on the assumption that Thailand's gross domestic product (GDP) growth will be in a range of 0.5% to 4.5%, depending on political developments and export growth.
Retail finance is expected to feel a significant effect from the lacklustre economy and swelling household debt.
Its 2014 growth is projected to shrink to 9.5% from 11% last year and 22% in 2012, K-Research said.
But the country's largest three lenders - Bangkok Bank (BBL), Krungthai Bank (KTB) and KBank - plan to increase their lending this year at the same rate as 2013.
BBL has roughly set its 2014 target for loan growth at 5-6%, assuming GDP growth of 3.2% to 3.3%, down from its 2013 projection of 4%.
However, BBL's 2014 business plan and economic projections have not been finalised.
"Despite the lower GDP growth forecast for 2014, the bank's loan demand remains in a positive trend, underpinned by the investment pipeline of existing customers. Therefore, 5-6% loan growth in 2014 is reasonable," said BBL executive chairman Kosit Panpiemras.
KTB and KBank have respectively targeted loan growth of 10% and 9-11% this year.
KTB, the country's second-largest bank by assets, expects its loan growth for 2013 will exceed its 10% target after it achieved the goal last September.
KBank, the fourth-largest bank, recently said its 2013 loan growth could achieve the low end of its target at 9%.
Among the four largest lenders, Siam Commercial Bank (SCB) is poised to become the most conservative next year.
Securities analysts predict loan growth of the country's third-largest bank will reach 7-10% in 2014, far below the 15-20% growth in recent years.
Senior executive vice-president Yokporn Tantisawetrat said SCB's lending in 2014 will expand at a slower pace than last year, as it remains alert to lingering uncertainties clouding both local and foreign markets.
Bualuang Securities forecasts SCB's loans will expand by 10% in 2014, while its target of 15% lending growth in 2013 will be reachable after booking growth of 12.7% year-on-year in the first 10 months.
CIMB Thai Bank, 93.5% owned by Malaysia's CIMB Group, projects loan growth of 15-20% in 2014, significantly declining from 25-30% growth annually in recent years, assuming the ongoing political uncertainties will end in six months and a new government is formed by June.
Banks specialising in auto hire-purchase loans such as Thanachart Bank, Tisco Bank and Kiatnakin Bank plan to diversify their lending portfolios amid waning demand for auto loans after the end of the government's first-time car buyer scheme.
Sales of new cars are forecast at 1.1 million this year, down from 1.3 million last year.
Kiatnakin plans to set up a small and medium-sized enterprise unit in 2014 after restructuring its corporate banking unit.
The banking sector index of the Stock Exchange of Thailand increased by 1.23% yesterday to close at 432.85 points in trade worth 9.27 billion baht.