Krung Thai Bank's THB20bn debenture program earns F1+(tha) rating: Fitch

Issuance proceeds are for general corporate purposes.

Fitch Ratings has assigned a National Short-Term rating of 'F1+(tha)' to Krung Thai Bank Public Company Limited's (KTB) unsubordinated and unsecured short-term debenture programme of up to THB20bn.

According to a release from Fitch Ratings, debentures issued under the programme will have a maturity of no more than 270 days, and can be issued in several tranches within a year. Proceeds from the issuance would be used for the bank's general corporate purposes.

The program is rated at the same level as KTB's National Short-Term Rating of 'F1+(tha)' as the debentures issued under the programme will constitute direct unsubordinated and unsecured obligations of the bank.

Here’s more from Fitch Ratings:

KTB's ratings are driven by its Support Rating Floor, and reflect Fitch's expectation of a high probability of extraordinary support from the Thai state, if needed.

KTB is the only commercial bank in which the state has majority ownership.

The bank is strategically important to the government - it has close operational links with the Ministry of Finance, manages the disbursal of the national budget, and is capable of playing a quasi-policy role to support government policies.

Any change in KTB's National Short-Term Rating will affect the rating of the unsubordinated unsecured debentures.

The National Short-Term Rating is the highest on the national scale, and hence there is no upside on the rating.

A reduced propensity of the government to provide support, including a material reduction of state ownership in KTB, could lead to a negative rating action on the Support Rating and Support Rating Floor, though we do not expect this to occur in the medium term, and in any case this would not necessarily have an immediate impact on the National Short-Term Rating.