Thai firms will issue bonds worth up to THB400bn in 2nd half: ThaiBMA

Private firms are expected to launch bonds worth at least 400 billion baht in the second half compared to 522.07 billion baht worth of corporate bonds launched in the first half, said ThaiBMA president Tada Phutthitada.

He added that the value of bonds launched in the first half of this year was 63 per cent higher than the 319.38 billion baht issued at the end of last year.

“The expectation was based on uncertainties over Covid-19 impact on Thai and global economies,” he said, adding that the pandemic situation should improve in the fourth quarter.

He went on to say that individual investors had bought up 35.25 per cent of corporate bonds in the first half of this year, higher than 34.81 per cent in 2020 and 31.58 per cent in 2019.

“To ensure that individual investors will not face huge losses from investing in corporate bonds, ThaiBMA will discuss with the bond issuers on how they can diversify investment risks,” he said.

He added that nine Thai companies in the second quarter of this year extended their bond repayment worth 9.8 billion baht to 12 months from between six and nine months.

“We expect more firms to extend their bond repayment, but it will not worth more than 2 billion baht as they need to seek permission from shareholders first,” he said.

He went to say that foreign investors' stakes in corporate bonds in the second quarter of this year was 908.38 billion baht, up from 849.08 billion baht at the end of last year.

“However, we expect foreign investors' funds to flow out from the Thai bond market in the fourth quarter of this year as they have turned from long-term bonds to short-term ones to escape volatility from the US Federal Reserve's move to ease its quantitative easing programme,” he added.