Kexim made success debut of its baht bond

Given its strong support from the Korean government, Kexim has been assigned credit ratings of "Aa3" by Moody's, "A" by Standard and Poor's and "A+" by Fitch.

Kexim is the only Korean issuer who has obtained permission from the Thai Finance Ministry to issue bahtdenominated bonds in the second half of this year.

With overwhelming demand from institutional investors, the combined order book was Bt9.6 billion, representing almost five times oversubscription of the original planned issuance of Bt2 billion. This allowed Kexim's bonds to be upsized to Bt3.5 billion, the maximum limit approved by Finance Ministry.

The total Bt3.5 billion was split into two tranches, threeyear and 10year maturity, with issue sizes of Bt2 billion and Bt1.5 billion, respectively.

The initial coupon range on the threeyear and 10year tranches was set at 5.39 per cent to 5.59 per cent and 6.28 per cent to 6.48 per cent, respectively. The coupons were finally set at 5.39 per cent for the threeyear issue and 6.28 per cent for the 10year issue. Both tranches closed at the tight end of the initial coupon range.

As this is the first baht bond offering by a Korean issuer, this transaction provides a benchmark for future baht bonds issued by the country's issuers.

Kexim has selected HSBC to act as the sole lead arranger and the sole book runner, taking into account the bank's experience in the Thai domestic bond market and Kexim's strong global relationship with HSBC.