This, the second ADB bond sale in Thailand to date, consisted of a five-year, Bt5.5-billion tranche with coupon rate of 5.34 per cent and a 10-year, Bt1 billion tranche with a coupon rate of 5.54 per cent. The coupon rates were priced at a spread of 20 basis points and 25 basis points, respectively over the interpolated Thai government bond curve.

According to the Thai Bond Market Association, five-year government bonds currently yield 5.12 per cent and the 10-year bond carries a rate of 5.27 per cent.

The baht-denominated bonds were sold in conjunction with the establishment of ADB's US$10-billion (Bt372 billion) Asian Currency Note Programme. This is Asia's first multi-currency platform since the Asian financial crisis.

ADB's bond issue is part of its plan to financially support the region. Last year, ADB sold Bt4-billion in bonds in Thailand.

The bond was overwhelmingly welcomed by institutional investors, according to Arthit Nanthawithaya, regional head of fixed income at Standard Charted (Thai), the lead arranger of the issue.

"This shows that investors are confident in the Thai bond market," said Arthit.

Khempheng Pholsena, an ADB vice president, said that the bond sale indicated that ADB had confidence in the Thai capital market. He added that the bonds would help enhance liquidity in the cross-currency swap market.

The bank plans to undertake currency-swap transactions for asset- and liability-management purposes.

Khempheng said the bank's return to the Thai bond market represented another important

step in ADB's quest for developing regional bond market.

Somruedi Banchongduang

The Nation