Bangkok--Apr 20--Moody's Asia Pacific
Moody's Investors Service has upgraded Bank of Ayudhya's (BAY's) long-term foreign currency deposit and senior debt ratings to Baa3 from Ba2, its long-term foreign currency subordinated debt rating to Ba1 from Ba3, and its short-term foreign currency deposit rating to Prime-3 from Not Prime. The outlook for the revised ratings is stable.
Moody's said the upgrades of its debt and deposit ratings reflect BAY's
growing systemic importance. BAY has consistently increased its share of the system's deposits, growing from 6% in 2000 to 9% by the end of 2004.
In addition, the pace of the bank's new lending has accelerated helping
maintain its market share above 9%. In the consolidating and competitive market, BAY has successfully defended its position as one of Thailand's leading mid-size banks. Thus, Moody's believes that the bank would benefit from a degree of regulatory support as a result of its enhanced systemic importance.
BAY's bank financial strength rating (BFSR) remains unchanged at E+,
reflecting the bank's improving operating performance but delicate capital structure. BAY continues to work its way out from under the burden of problem loans left from the financial crisis. Unlike many of its peers, it has done so on its own, without a requiring a bail out from the government. However, any material economic deterioration could create undue stress on its asset quality and earnings, preventing the restoration of full capital adequacy.
BAY, headquartered in Bangkok, is Thailand's fifth largest bank by
deposits and sixth largest by total assets. As of December 31, 2004, the bank had total assets of Baht 574 billion (US$ 14.7 billion).
The following ratings were upgraded:
Bank of Ayudhya -- long-term/short-term foreign currency deposit ratings
to Baa3/P-3 from Ba2/NP. Stable outlook.
Bank of Ayudhya Public Co Ltd (Hong Kong) -- senior unsecured/short-term
foreign currency debt ratings to Baa3/P-3 from Ba2/NP, and subordinated
foreign currency debt rating to Ba1 from Ba3. Stable outlook.
The following rating was unaffected:
Bank of Ayudhya -- bank financial strength rating of E+. Stable outlook.
Deborah Schuler
VP - Senior Credit Officer
Financial Institutions Group
Moody's Singapore Pte Ltd.
Telephone: 65-6398-8300
Facsimile: 65-6398-8301 End.