Published on May 13, 2005

Siam Commercial Bank plans to issue up to Bt1 billion in equity-linked notes this month to finance business operations, a company official said yesterday.

The notes will be offered by the bank’s SCB Securities unit in two tranches, said Paritat Lerngutai, SCB’s chief adviser on equity derivatives. He said Bt500 million would be offered in three-month notes and another Bt500 million in six-month notes.

“This will be the country's first derivative to be sold to retail investors. We plan to do more if the first one is successful,” Paritat said.

The issue is part of a previously announced plan to sell Bt2 billion of equity-linked notes.

The three-month notes will return the full principal, carry a coupon rate higher than the average three-month deposit rate offered by Thailand’s top four banks, currently 1 per cent, and provide returns linked to a selected stock, he said.

The notes will be linked to PTT Plc, Siam Cement, Advanced Info Service or Bangkok Bank, Paritat said. He said the six-month issue would repay 80 per cent of the principal and carry a coupon rate higher than the average six-month deposit rate by the top four banks.

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