Bt28-bn Krung Thai bank bond issue for business expansion

The proceeds will be used by the country's second-largest bank as Tier-2 reserves for business expansion, president Apisak Tantivorawong said yesterday.

The bonds will be sold in two tranches, offering a fixed interest rate and a variable interest rate based on the six-month deposit rate.

The exact size of the issuance and interest rates will be determined later, he said.

Siam Commercial Bank has also reported it would sell 10-year subordinated debentures to individual investors. The bonds will carry a fixed-to-floating rate every six months for the 10-year term. The rate will be fixed at 4.25 per cent for the first and second years, 5.25 per cent for the third to sixth year and 6.25 per cent for the seventh to 10th year.

The SCB bonds are callable after five years, in which case the bank will pay holders 25 basis points of extra interest.

Subscription is open from Monday to Wednesday with a minimum of Bt100,000.

Late last month, Advanced Info Service issued five-year debentures worth Bt4 billion that offer 4 per cent for the first two years and 4.9 per cent thereafter.

Ch Karnchang last month sold three-year unsubordinated debentures worth Bt2 billion with a rate of 5 per cent.