SCB's three-year senior unsecured floating-rate notes (FRNs) were offered solely in offshore markets last week. The majority of the issue was distributed to Asian-based markets.

The notes are rated Baa 1, BBB and BBB+ by Moody's Investors Service, Standard & Poor's and Fitch Ratings, respectively, and priced at 23 basis points over the London inter-bank offered rate. The offering is aimed at refinancing the bank's existing $150 million in debentures.

Jada said the oversubscription and the price reflected the bank's credibility, based on its firm strategy and direction and strong financial performance.

The issuance apparently reflects the rising appetite for dollar-denominated bonds issued by Asian corporations, as recently South Korea's Woori Bank also said it would issue a $1-billion bond and the Philippines' San Miguel said it planned to issue a dollar-denominated hybrid bond. However the latter was postponed.

Jada also said SCB planned to issue short-term debentures in baht, with a maximum period of 270 days. The coupon rate of the new bonds is expected not to exceed 5.2 per cent based on the current treasury bill rate. The new funding will be used for the bank's business expansion.

Separately, executive chairman Vichit Surap-ongchai said SCB had also achieved success in its tender offer to purchase the securities of Siam Panich Leasing (SPL). About 119.56 million shares of SPL were tendered by the bank.

Following the tender offer, SCB holds 198.88 million shares in SPL, representing 92.51 per cent of the company's total paid-up shares, an increase from 36 per cent.

"From now on, SCB will use SPL as the vehicle to aggressively expand into the hire-purchase business following the bank's universal-banking target. The bank aims to become the market leader in this business in the next few years," Vichit said.

Presently, SPL is ranked fifth in terms of market share in auto hire-purchase business and the company normally generates income of Bt800 million to Bt1 billion per annum, he added.

Following the tender offer, SCB's total assets will increase by Bt43 billion from Bt919 billion currently, ranking it as the country's third-largest bank. For this acquisition of 119.56 million SPL shares, the bank will spend about Bt4.54 billion based on the offered price of Bt38 per share.

"The bank has no plan to change SPL's management team," Vichit said. "The company will not be delisted from the stock market for a year after the tender offer ends."

Meanwhile, Jada has been appointed by the Thai Bankers Association's committee as the association's new chairwoman, with effect from April 1. She replaces Chartsiri Sophonpanich, the president of Bangkok Bank.

Somruedi Banchongduang

The Nation