Thailand Financial News

Moody’s Investors Service has assigned a provisional rating of (P)Baa1 to Siam Commercial Bank Public Company
Limited’s (SCB) proposed USD300 million senior unsecured floating rate notes due 2009. The notes will be issued via its Singapore branch. The outlook for the rating is stable.

The provisional rating is subject to receipt of final documentation, with terms and conditions that do not deviate materially from the preliminary documents already reviewed by Moody’s. The senior notes are rated at the same Baa1 level as SCB’s existing foreign currency long-term deposits. Both ratings are also at the foreign currency country ceiling. SCB’s ratings are underpinned by expected strong external support, its solid capital position and successful expansion strategy. “Moody’s expects strong support from its key shareholder - the Crown Property Bureau, an agency that manages the Thai monarchy’s properties, and which has a 24% stake - if needed,” says Leo Wah, a Moody’s Assistant Vice President/Analyst, adding, “As the fourth-largest Thai bank, SCB is also systemically important.” “SCB has restored its core earnings and capital adequacy after the shocks in previous years,” says Wah, who is also Moody’s lead analyst for the bank, adding, “The bank’s expansion into consumer and middle-market lending, despite rising competition with more players, has so far delivered satisfactory results on the strength of a successful execution and its own solid capital base.” The 3-year notes are an unsecured, unsubordinated obligation of SCB. A cross default provision allows the notes to become due if SCB does not pay any obligation exceeding USD30 million within 30 days after the due date. The issue will be subject to a negative pledge, prohibiting SCB to pledge its assets unless the issue enjoys the benefits derived from the
pledge as well. Headquartered in Bangkok, SCB is Thailand’s fourth largest bank. It had total assets of Bt814 billion (USD20 billion) as of December 31, 2005. The other ratings of the bank are: Siam Commercial Bank Public Company Limited — Bank financial strength
rating of D+, on review for possible upgrade, as well as foreign currency deposit ratings of Baa1 and Prime-2, with a stable outlook. Moody’s Investors Service is a publisher of rating opinions and research.
It is not involved in the offering or sale of any securities, nor is it acting on behalf of the offering party. This release is not a solicitation or a recommendation to buy, hold or sell securities. Hong Kong
Leo Wah, CFA