ICBC (Thai) Leasing lauds success of debenture issue
ICBC (Thai) Leasing successfully issued two- and three-year guaranteed debentures for the first time with a total amount of Bt5.6 billion. The debentures were offered to institutional and high-net-worth investors who showed overwhelming interest, reflecti
To support further business expansion, ICBC (Thai) Leasing decided to tap the bond market for the first time and reports that the mission has been completed with great success. The debentures consisted of a Bt3-billion two-year tranche with coupon rate of 3.79 per cent and a Bt2.6-billion three-year tranche with coupon rate of 3.98 per cent.
Bangkok Bank and Kasikornbank were joint lead arrangers of the transaction.
The issue size, although originally targeted at Bt4 billion, was upsized to Bt5.6 billion to accommodate high demand from institutional investors and wealthy individuals.
Ong-ard Vorachattarn, president of ICBC (Thai) Leasing, said funds raised through the debentures would be used to expand the company’s hire-purchase portfolio. Given this successful milestone, ICBC (Thai) Leasing is now considering issuing senior and unsecured debentures in the near future.
Surabhan Purnagupta, a senior vice president and manager of corporate finance for the investment banking group, Bangkok Bank, said the debentures were rated "AAA" by Fitch. This was based on an unconditional and irrevocable guarantee from ICBC (Thai), which owns 99.99 per cent of ICBC (Thai) Leasing, together with the solid financial performance of the company during the past five years.
The 3-per-cent market share and being one of the top 10 players in Thailand’s hire-purchase market in 2011 have inspired confidence to invest in these inaugural debentures.
Panop Ansusinha, investment banking business division head at KBank, added that both debentures were so well received by institutional investors that demand was higher than the original issue size targeted by ICBC (Thai) Leasing.
KBank and Bangkok Bank believe that ICBC (Thai) Leasing will be able to become a regular issuer of debentures in the Thai debt capital market and gain continuous success in the future.
Ye Hu, chairman of Industrial and Commercial Bank of China (Thai), said his firm positioned ICBC (Thai) Leasing as one of its financial arms and as a crucial key for it to penetrate the consumer-finance business in Thailand.
ICBC (Thai) Leasing is treated as a department of ICBC (Thai) and thus gets support in all areas including financing, management, risk management and experienced human resources from ICBC Group in China. Such support is meant to help it become one of the leading leasing businesses in Thailand, the firm says.
