Bangkok--Mar 9--Moody's Investors Service
Moody's Investors Service has assigned the Small and Medium Enterprise Development Bank of Thailand (SMEB) first-time foreign currency long-term issuer and deposit ratings of Baa1 and short-term deposit ratings of Prime-2. The rating outlook is stable.
Moody's said SMEB's ratings are at the same level as its ratings on the
Thai government, reflecting the very strong government support for this bank. SMEB is a relatively small, 97% government-owned development bank.
The Thai Ministry of Finance (MOF) holds 95% of its shares, but the bank
is under the direction and sponsorship of both the MOF and the MOI (Ministry of Industry).
Established as a bank under and operating according to The Medium and
Small Enterprise Development Bank of Thailand Act of 2002, SMEB is one of 10 Thai Specialized Financial Institutions (SFIs), only six of which are banks. The other bank SFIs include Moody's-rated Export Import Bank of Thailand (Baa1) and Government Housing Bank (Baa1).
SMEB's financial fundamentals are affected by its role as a policy bank.
Margins are low to keep its loans affordable to its customers. A legacy of Asian Crisis-related problems loans and the inherent risks of its policy mandate have burdened the bank with a high level of non-performing loans. However, creative NPL resolutions undertaken since SMEB change of status to a bank (it was previously a finance company) promise to limit the losses and the need for additional government capital.
Headquartered in Bangkok, SMEB's mission is to foster the development of
Thailand's small and medium enterprises that are not yet bankable by commercial banks. The bank had total assets of THB 37 billion (USD 950 million) on December 31, 2004.
Singapore
Deborah Schuler
VP - Senior Credit Officer
Financial Institutions Group
Moody's Singapore Pte Ltd.
Telephone: 65-6398-8300
Facsimile: 65-6398-8301 End.