KTB to issue Bt15bn subordinated debentures
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Krung Thai Bank is issuing unsecured subordinated debentures of up to Bt15 billion, to strengthen the bank's Tier 2 capital and refinance its maturing subordinated debentures.
The bonds offer the annual coupon rate of 4.60 per cent, payable every quarter. They will be available for subscription during Oct 29-Nov 1 at all branches nationwide. Minimum subscription is Bt100,000.
Apisak Tantivorawong, president of KTB, said that the proceeds will boost the bank's resources for future lending and strengthen the Tier 2 capital.
Fitch Ratings (Thailand) assigned the issue at "AA". The rating company said that the 10-year bond issue, with a call option after five year, comes with an option for the bank to issue a further amount of upto Bt10 billion.
"KTB's rating is based on Fitch's expectation of state support for the bank in case of need. This based on the bank's strong linkages with the government through the latter's ownership, control and evidence of support. The bank's large size and systemic importance also make government support likely in times of distress," Fitch said in a statement.
KTB is Thailand's second-largest commercial bank by consolidated assets with an 18 per cent market share at end-June 2012. Its major shareholder, with a 55 per cent stake, is Financial Institutions Development Fund, a unit under the Bank of Thailand.
The bank recently won the board's approval to raise over Bt35 billion from the issuance of 2.80 billion shares.
