Thailand Bond House: Bangkok Bank

IFR Asia Awards 2022
3 min read
Kit Yin Boey

Diving deeper

Bangkok Bank pushed further than the competition in 2022 in adding depth and breadth to a rapidly growing corporate bond market in Thailand, particularly in the burgeoning ESG space.

“With the bank’s regional leadership position and our commitment to support the development of sustainable financing in the Thai bond market, we are a key player and contributor to promoting sustainability products for both sovereign and corporate bond issuers across sectors, encompassing several green project categories and structures,” said Prasert Deejongkit, Bangkok Bank executive vice president for corporate finance.

Refinitiv data show Bangkok Bank taking the second spot in the Thai baht bond league table with Bt82.4bn (US$2.5bn), equivalent to a 14% share, in 2022.

That volume includes a milestone-setting Bt8.4bn project finance green bond for Xayaburi Power Company, a hydropower producer based in Laos. The triple-tranche bond was the first green bond in Thailand for a hydropower project.

Bangkok Bank was the sole green adviser on the transaction, rated BBB+ by Tris. When the deal was marketed to Thai investors in July, Moody’s had just downgraded Laos to Caa3 from Caa2 on increased liquidity risk and high debt levels.

Bangkok Bank, the issuer, and major shareholder CK Power worked hard to alleviate the concerns. They pointed to the project’s strong and stable cashflows underlying the deal, and explained as well how the structure of the run-of-the-river hydropower project met international green standards.

The result was a very strong order book, allowing the deal to be upsized from a minimum Bt5bn.

Bangkok Bank’s commitment to developing sustainable financing solutions went even further. The bank was retained by Thailand’s Ministry of Finance as one of the lead banks for the Kingdom’s second series of sustainability bonds issued in 2022.

When transit company BTS Group brought a public offering of sustainability-linked bonds – the first retail SLB in Asia ex-Japan – the bank conducted investor education. The retail bid was so strong that the final issue size, which included both retail and institutional bonds, was lifted from Bt13bn to Bt20bn.

Bangkok Bank made other efforts to widen retail investors’ access. It upgraded its phone app Bualuang mBanking to let retail investors apply for more complex securities such as corporate perpetual bonds, which require investors to answer a series of questions to make sure they understand the risks. The app was the first in the Thai market to offer this feature when the bank opened subscription to Minor International’s Bt13bn 6.1% perpetual bond in September.

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