BBL to issue dollar-denominated bonds
Bangkok Bank is raising an undisclosed sum of funds through US dollar-denominated unsecured notes.
The issue is rated "BBB+" long-term issue rating by Standard & Poor's Ratings Services.
Moody's Investors Service assigned "A3" foreign currency senior unsecured debt rating to BBL's notes, to be issued by its Hong Kong branch.
According to Moody's, BBL's ratings are underpinned by its leading franchise in Thailand (as the largest of the big four Thai banks), its strong capital adequacy, its under-utilized balance sheet which offers potential for expansion, its strong profitability, and sustained improvements in asset quality and reserves.
On the other hand, the rating also takes into consideration the risks pertaining to the country's operating environment, the bank's prudent expansion into the retail business despite a large branch network, and its relatively high borrower concentration.
Fitch Ratings rated BBL’s bonds at “BBB+”.
BBL is Thailand's largest commercial bank by consolidated assets with an 18 per cent share of loans and a 20 per cent share of deposits at endJune 2012. BBL has a strong business franchise in large corporates and SMEs and continues to expand into retail lending. BBL has 1,077 domestic and 25 offshore branches and one representative office in 13 countries, mainly in Asia.
Siam Commercial Bank has so far this year raised US$1.1 billion through dollar-denominated bonds. For the $500 million issue, it revealed that the issue was oversubscribed by institutional investors by 4.6 times.
The 5-year notes are issued by SCB’s Hong Kong branch. The proceeds will be used for the bank’s general funding purpose.
The notes were issued as part of the bank's global medium term note programme worth totally over $2 billion. Earlier, this year, the bank issued $600 million.
In a statement, SCB said that 150 accounts in Asia and Europe participated in the transaction.
“We are pleased to see the robust demand for our transaction and the strong perception of our credit by the international investor community. The execution process was swift and ensured a strong momentum to our transaction. The lead managers have provided us with the right pricing strategy to help us achieve our targets for this fund raising exercise," Kannikar Chalitaporn, president of SCB, commented.
The notes were priced at 215 basis points over the 5-year US Treasuries, bearing fixed interest of 3.375 per cent per annum.
In terms of geographic distribution, 73 per cent of the notes were distributed in Asia and 27 per cent in Europe. Among subscribers, 57 per cent were funds, 25 per cent to banks, 9 per cent to private banks, 6 per cent to insurance funds and 3 per cent to public sector institutions.
Barclays and Deutsche Bank acted as joint bookrunners and lead managers on the transaction.
