Bangkok--24 Oct--Fitch Rates
Fitch Ratings (Thailand) Limited has assigned CIMB Thai Bank Public Company Limited’s (CIMBT; ‘AA-(tha)’/Stable) unsecured subordinated debentures of up to THB1.5bn, with an option to issue a further THB1.5bn, a National Long-Term rating of ‘A+(tha)’. The debentures will mature in 10 years. The proceeds will be used to strengthen the bank’s Tier 2 capital.
The subordinated debentures are rated one notch below CIMBT’s National Long-Term rating to reflect their subordination in the capital structure and are in line with Fitch's approach to rating such subordinated debt instruments of financial institutions.
CIMBT's National ratings are underpinned by Fitch's view that there is a high probability of support, if required, from its parent, CIMB Bank Berhad (CIMB; ‘BBB+’/Stable) of Malaysia. Fitch believes that should parental support be required by CIMBT, this would also extend to these subordinated debt instruments. CIMBT is strategically and operationally integrated with CIMB and has close name association with the parent. CIMB has near full ownership (93.2%) and management control of CIMBT.
Any changes in CIMB's ability or propensity to support CIMBT, including changes to its stake in the bank, could affect CIMBT's ratings. However, Fitch believes this is unlikely in the medium term. CIMBT's Outlook is Stable, consistent with that of its parent.