CIMB Thai to recapitalise via new issue
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CIMB Thai Bank's shareholders have approved an increase of its registered capital to Bt13.05 billion from Bt8.16 billion by issuing 9.78 billion new shares with a par value of 50 satang to strengthen its Tier 1 capital and business expansion.
Subhak Siwaraksa, president and chief executive officer, said the new shares, whose total value is Bt2.44 billion, would be offered to existing shareholders at the price of Bt1 each at the ratio of three new CIMB Thai shares for every 10 existing ones.
After increasing its registered capital, CIMB Thai Bank’s BIS ratio will increase to 16.6 per cent from 13.2 per cent as at the end of last year, and Tier 1 capital ratio will increase to 11 per cent from 7.65 per cent.
The increase in registered capital is to ensure that its Tier 1 capital ratio conforms with Basel III, the new global regulatory standards of the Bank of International Settlements.
The shareholders on Thursday also approved an amendment to cap debenture issuance at Bt40 billion, from Bt30 billion previously.
Subhak said the increased debenture ceiling was to enhance the flexibility in managing the bank’s capital structure and responding to customers’ demands.
The increase is in line with the new regulatory criteria limiting banks’ issuance of bills of exchange, he said. Because of these limits, the bank had to consider mobilising more funds via debentures.
Moreover, the increase in the debenture will prepare CIMB Thai for the near future, when banks will only be able to issue embedded debt in the form of debentures.
