Bangkok--10 Apr--Fitch Ratings
Fitch Ratings has assigned Siam Commercial Bank Public Company Limited’s (SCB; BBB+/Stable) USD750m five-year senior unsecured notes due April 2019 a final rating of ‘BBB+’. The notes are issued under SCB’s USD3.5bn medium-term note (MTN) programme, and are issued by the bank’s Cayman Islands branch.
The rating action follows the completion of the bond issue, as well as the receipt of final documents conforming to information previously received. The final rating is the same as the expected rating assigned on 2 April 2014.
KEY RATING DRIVERS
The notes are rated at the same level as SCB’s Long-Term Foreign-Currency Issuer Default Rating (IDR) and the rating on its MTN programme of ‘BBB+’, as they represent unsecured and unsubordinated obligations of the bank.
SCB’s IDR reflects its stand-alone credit strength. SCB is Thailand’s second-largest commercial bank by assets as of December 2013, and it has sound profitability and capitalisation.
Rating Sensitivities
The rating on the senior unsecured notes would be directly impacted by any changes in SCB’s Long-Term Foreign-Currency IDR.
A ratings upgrade may be considered if there is sustained improvement in the operating environment, and a further material improvement in SCB’s financial profile.
Negative rating action on SCB’s IDR could arise from a significant erosion of capital buffers alongside an increase in risk appetite, which, for example, may be seen in excessive credit growth or loan concentration risk.
The other ratings of SCB are unaffected by this action, and are as follows:
Long-term IDR: ‘BBB+’; Outlook Stable
Short-term IDR: ‘F2’
Viability Rating: ‘bbb+’
Support Rating: ‘2’
Support Rating Floor: ‘BBB-’
National Long-Term Rating: ‘AA(tha)’; Outlook Stable
National Short-Term Rating: ‘F1+(tha)’
Global medium term note programme: ‘BBB+’
Long-term foreign currency senior unsecured debt: ‘BBB+’
National short-term senior unsecured debt programme: ‘F1+(tha)’
National long-term subordinated debt: ‘AA-(tha)’