Bangkok--14 Jun--Fitch Ratings
Fitch Ratings (Thailand) has today assigned Bank of Ayudhya Public Company Limited's (BAY; AAA(tha)/Stable) upcoming issue of senior unsecured bonds National Long-Term Ratings of 'AAA(tha)'.
The bonds will have tenor(s) of two and/or three years, and the total issue size will be up to THB12bn. Proceeds of the issue will be used for refinancing and/or general corporate purposes.
KEY RATING DRIVERS
The bonds are rated at the same level as BAY's National Long-Term Rating, as they represent unsubordinated and unsecured obligations of the bank.
BAY's National Ratings reflect Fitch's belief that it is a strategically important subsidiary of its parent the Bank of Tokyo-Mitsubishi UFJ, Ltd (BTMU; A/Stable). BTMU holds 76.9% of BAY, and the Thai bank is a key part of the parent's strategy for south-east Asia with high levels of management control and integration.
RATING SENSITIVITIES
The rating on the bonds is sensitive to any changes in BAY's National Rating. The National Ratings of BAY are at the top end of the scale, and no upside is possible.
A downgrade of the Long-Term Issuer Default Rating of BTMU could lead to negative rating actions on BAY, including on the National Long-Term Rating.
BAY's ratings could also be negatively impacted if BTMU shows a reduced propensity to support BAY – which may, for example, be seen via a significantly reduced shareholding or reduction in operational integration. However, Fitch views that this would be unlikely in the medium term.
BAY's other ratings are not affected, and are as follows:
Long-Term Issuer Default Rating: 'A-'; Outlook Stable
Short-Term Issuer Default Rating: 'F2'
Viability Rating: 'bbb'
Support Rating: '1'
National Long-Term Rating: 'AAA(tha)'; Outlook Stable
National Short-Term Rating: 'F1+(tha)'
National long-term rating on senior unsecured debt: 'AAA(tha)'
National short-term rating on senior unsecured debt: 'F1+(tha)'
Rating on Legacy Basel II subordinated debt: 'AA+(tha)'