Bangkok--15 Dec--Fitch Ratings
Fitch Ratings (Thailand) has assigned Bangkok Commercial Asset Management Public Company Limited's (BAM; AA-(tha)/Negative) issuance of Thai baht senior unsecured notes a rating of 'AA-(tha)'. The issuance will have maturities of up to seven years. Proceeds will be used for general corporate purposes and refinancing.
KEY RATING DRIVERS
The notes are rated at the same level as BAM's National Long-Term Rating, as they represent the company's unsubordinated and unsecured obligations.
BAM's National Long-Term Rating is driven by sovereign support. BAM is a wholly owned subsidiary of a unit of the central bank and has an important role in the financial system as Thailand's largest distressed-asset manager.
The Negative Outlook on BAM's National Long-Term Rating is due to Fitch's expectation of reduced state propensity to support BAM. It is unclear whether the central bank sees BAM as a key long-term shareholding and the shape of future state linkages remains uncertain.
RATING SENSITIVITIES
Any changes to BAM's National Long-Term Rating will have a similar effect on the issue's rating.
Signs of a long-term state commitment to maintain its shareholding in BAM and the retention of its existing regulatory advantages would lead to a revision of the Outlook to Stable and a possible re-assessment of the National Long-Term Rating.
Changes in BAM's shareholding structure would be likely to negatively affect the rating. A reduction in the state's shareholding to below 50% and a removal of BAM's regulatory advantages would be likely to result in a multiple-notch downgrade. However, the final rating would also depend on BAM's leverage and overall financial profile.
For further details, please see Fitch Affirms Bangkok Commercial Asset Management at 'AA-(tha)'; Outlook Negative (https://www.fitchratings.com/site/pr/1011162) dated 2 September 2016.