The Export-Import Bank of Thailand yesterday appointed Daiwa and Mizuho as joint lead managers for the sale of its floating-rate notes worth US$200 million (Bt6.7 billion) to leading institutional investors, to raise funds for expansion.
Infrastructure services, if quickly improved, could promote a better investment climate in Thailand
Dr. Apichai Boontherawara, President of Export-Import Bank of Thailand (EXIM Thailand), Mr. Yuichi Akai, Chairman of Daiwa Capital Markets Singapore Limited (Daiwa), and Mr. Tomohiro Watanabe, General Manager of International Finance Department, Mizuho Securities Company Limited (Mizuho), signed a subscription agreement to appoint Daiwa and Mizuho as joint lead managers for EXIM Thailand’s selling of 200-million-USD FRNs with five-year maturity due 2015 at EXIM Thailand’s Head Office on January 11, 2010.
According to EXIM Thailand’s President, the FRNs selling to be kicked off on January 14, 2010 is expected to be well received by leading institutional investors. The purpose of the FRNs issuance is to use the fund raised for refinancing EXIM Thailand’s maturing debts in 2010 and expanding the Bank’s businesses, following EXIM Thailand’s satisfactory operating results. In December 2009, Fitch Ratings (Thailand) has affirmed EXIM Thailand’s long-term foreign currency issuer default rating (IDR) at ‘BBB’ with a stable outlook, as a result of the Bank’s improvement in financial performance in 2009, reduced non-performing loans (NPLs) and strong capital position. As state-owned financial institution with mandate to support and promote the growth of Thai export, investments abroad and investments for national development, EXIM Thailand’s ratings are correlated with the Thailand’s sovereign ratings.
Infrastructure plays a crucial role in economic development and enrichment of living standards. Various stages of economic development require different levels of infrastructure upgrades or enhancements to ensure infrastructure in fact facilitates economic activities. Thailand has been facing a series of infrastructure challenges, both new and well-established. To name a few: there is a need for infrastructure services to catch up with economic development and international competition, manage the growth in urban areas, respond to global energy prices, and ensure basic services for the poor.
Export-Import Bank of Thailand (EXIM Thailand) is a financial institution wholly owned by the Royal Thai Government under the Ministry of Finance’s supervision. EXIM Thailand was established by the Export-Import Bank of Thailand Act B.E. 2536 (1993) which became effective on September 7, 1993. According to the Act, the initial capital of 2,500 million baht was paid by the Ministry of Finance and the Bank of Thailand. Following rapid business expansion, the Bank’s capital was increased with the Ministry of Finance’s additional contribution of 2,500 million baht and 1,500 million baht in April and July 1998, respectively.
Under the Export-Import Bank of Thailand Act, EXIM Thailand is empowered to engage in various business undertakings. EXIM Thailand can offer short-term as well as long-term credits, either in domestic or overseas markets, in baht or any foreign currency denominations. In mobilizing funds, EXIM Thailand can borrow from local or overseas financial institutions, as well as issue short-term or long-term financial instruments for sale to financial institutions and the general public, both domestically and internationally. Essentially, EXIM Thailand can engage in any financial activities customary to commercial bank practices, except for accepting deposit from the general public. EXIM Thailand officially started its operation on February 17, 1994. In November 1999, the Export-Import Bank of Thailand Act (No.2) B.E. 2542 (1999) was enforced to clarify and expand the Bank’s objective and scope of operation with regard to investment promotion and support. The amendment enabled the Bank to provide more comprehensive support to Thai investors overseas as well as local investors in business relating to export or business which earns or saves foreign exchange.