Kingdom of Thailand Bond Market - PDMO Bond Market Booklet Q3 FY2… · Kingdom of Thailand Bond Market ... Savings Bond & Money Expo 2014 ... Retail Investor holding in Government

Public Debt Management Office, Ministry of Finance, Kingdom of Thailand

Kingdom of Thailand Bond Market Financing Thailand’s Future & Connecting ASEAN

Highlights MOF awards 2013 & ILB Achievements

Savings Bond & Money Expo 2014

Government Bond Auction Schedule Q3/FY2014

T-Bill Issuance Program

Progress Update Greenshoe Option: MOF Outright PDs Privilege in FY2015

Bond Switching & Consolidation Work Plan

GGLB Rollover Plan Towards ASEAN “Preferred Destination”

Basic & Essentials • Public Debt Outstanding and Its Composition

• Bond Market Capitalization and Its Composition

• Total GOVT Bond Supply Issuing in FY2014

• Government Bond Auction Result in First Half of FY2014

• Non-Resident Holding in Domestic Bond

B. Progress Update

• MOF Awards 2013 & ILB Achievements

• Savings Bond & Money Expo 2014

• Government Bond Auction Schedule Q3/FY2014

• T-Bill Issuance Program

Domestic Bond Market Development

This booklet is produced and printed in-house by Bond Market Development Bureau Public Debt Management Office , Ministry of Finance, Kingdom of Thailand

This booklet can be downloaded at www.pdmo.go.th e-book

A. Highlights

C. Basic & Essentials

• Greenshoe Option : MOF Outright PDs Privilege in FY2015

• Bond Switching & Consolidation Work Plan

• GGLB Rollover Plan

• Towards ASEAN “Preferred Destination”

• Public Debt Outstanding and Its Composition (As of Jan 2014) = 5,466,198 THB Mil. (45.75% of GDP)

• Bond Market Capitalization and Its Composition (As of Mar 2014) = 9,202,573 THB Mil.

(76% of GDP)


• GOVT Bond Auction Result in First Half of FY2014


NR Holding in THB Bond (As of Mar 2014) = 679,137 THB Mil. (GOVT Bond : 559,677 THB Mil., BOT Bond 118,713 THB Mil., Corp Bond : 747 THB Mil.)

Net Change in NR Holding (Jan – Mar 2014) = -28,238 THB Mil.

(GOVT Bond : Net Sell -36,164 THB Mil., BOT Bond : Net Buy +7,926 THB Mil.)

1

12

18

1

• MOF Awards 2013 & ILB Achievements

• Savings Bond & Money Expo 2014

• Government Bond Auction Schedule Q3/FY2014

• T-Bill Issuance Program

A: Highlights

M O F A w a r d s 2 0 1 3 Presented at Best Bond Awards 2013 on April 1, 2014

Organized by Thai Bond Market Association

Winner : Bangkok Bank Public Company Limited

Runner Ups : Kasikorn Bank Public Company Limited

: Krung Thai Bank Limited

*Highest percentage share of allocation of all GOVT Bonds issued in FY2013 in the primary market. **Highest percentage share of trading of all GOVT Bonds issued in FY2013 in the secondary market .

There are approximately 25-30 participants in the market.

Winner : Deutsche Bank AG., Bangkok Branch

Runner Ups : Bangkok Bank Public Company Limited

: Citibank N.A.

(In alphabetical order)

(In alphabetical order)

(In descending order)

(In descending order)

2

M O F A w a r d s 2 0 1 3 Presented at Best Bond Awards 2013 on April 1, 2014

Organized by Thai Bond Market Association

Winners : Bangkok Bank Public Company Limited

: The Hongkong and Shanghai Banking Corporation Limited

*** Highest scores voted by PDMO’s Executives

BBL

HSBC

DBBK

(Tied)

Deutsche Bank AG., Bangkok Branch

The Hongkong and Shanghai Banking Corporation Limited

Bangkok Bank PCL.

3

L o o k i n g B a c k @ I L B Innovation for sophisticated investors

Instrument to hedge against Asian Inflation First and only ILB in ASEAN since 2011

Achievement awards

Deal of the Year 2013 From Best Bond Awards 2013 (Thai Bond Market Association) (L) Dr. Prasarn Trairatvorakul, Governor, Bank of Thailand (R) Ms. Chularat Suteethorn, Director General Public Debt Management Office, Ministry of Finance 1 April, 2014

- Best Thailand Deal 2011 - Best Local Currency Bond 2011

From Finance Asia Achievement Awards 2011 Mr. Suwit Rojanavanich, Bond Market Advisor, PDMO, MOF

2 February, 2012 (Hong Kong)

• Best Sovereign Bond Deal of the Year 2013 in Southeast Asia

• Best Thailand Deal 2011 • Best Local Currency Bond 2011

Deal of the Year 2011

• Best Thailand Deal of the Year 2011 • Best Sovereign Bond of the Year 2011

Thailand Capital Market Deal of the Year 2011

Outstanding Issuer of the Year 2011

The Most Impressive Local Currency Bond 2011

- Deal of the Year 2011 - Most Creative Issue 2011 From Best Bond Awards 2011 (Thai Bond Market Association) (L) Dr. Prasarn Trairatvorakul, Governor, Bank of Thailand (R) Dr. Pimpen Ladpli, Acting Executive Director, Bond Market Development Bureau 10 May, 2012 (Bangkok)

Best Sovereign Bond Deal of the Year 2013 in Southeast Asia At The 7th Annual Alpha Southeast Asia Deal and Solution Awards 2013

(R) Mr. Nattakarn Boonsri Director, Government Bond Market Development Division

23 January, 2014 (Kuala Lumpur)

• Deal of the Year 2011 • Most Creative Issue 2011 • Deal of the Year 2013

4

L o o k i n g F o r w a r d Building up ILB283A to 100,000 MB

Enforcing market making responsibility as PDs’ duties Possible issuance of 30yr ILB to extend ILB Yield Curve Including in global indices (1.6% weight in Barclays EMGILB

Ex-Argentina Ex-Columbia Constrained Index, as of April 2014)

100,872MB*

64,160MB*

TTM

5,000MB

5,000MB

5,000MB

7 14

ILB217A ILB283A

To be issued by end of FY 2014

To be issued in FY 2015

To be launched in FY 2015-16

Source : Bank of Thailand

Thailand’s Inflation during the past 3 decades “Moderate & stable” (headline = 3.5% / core = 2.8%) (1985-2014 avg.)

3%

1.5%

Past 10 year avg.

30

* Outstanding at the end of Q2/FY14

5

MONEY EXPO 2014 “CONNECTING LIFE”

IMPACT CHALLENGER HALL 2 – 3 8th – 11th May 2014

Booth # M2

SAFE HAVEN

SAVINGS BOND

The Launch of

SAVINGS BOND* (SB175A)

3-year tenor

MONEY EXPO 2014 Impact Challenger Hall 2 – 3

8th – 11th May 2014 Public Debt Management Office Booth [M2]

6

* Eligible for Individuals and Non-Profit Institutions such as foundations, Thai Red Cross Society, and the National Council on Social Welfare of Thailand

7

2545 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2015 2017

3. SB148A

5. SB149A

2. SBST147A

1. SB145A

4. SB148B

6. SB149B

7. SB149B

9. SBST166A

8. SB15NA

11. SB189A

43,303 MB

10,821 MB

80,000 MB

334 MB

78 MB

459 MB

2,738 MB

82,230 MB

3,930 MB

31,577 MB

FY2014 Expiration of SB 137,733 THB Mil. (53%)

FY2016 Expiration of 3 SB 90,160 THB Mil. (35%) FY2018 Expiration of 1 SB 31,577 THB Mil. (12%)

2561

-0-

Today

Zero

A

B

C

ABC

No more Saving Bond Issued … No more Saving Bond Remaining

The last serieswill expire in FY 2018

Savings Bond : The Safe Haven for Retail(Current Outstanding : 259,470 THB Mil. , 11 Series)

2014 2016 2018

Bond Tenors

10. SB16DA 4,000 MB

2555-56 180,xxx 38,xxx

Retail Investor holding in Government Bond % Share of Government Bond

Saving Bond Outstanding

-0-

Structure Shift… between Non-Resident and Retail Investor Holding in GOVT BOND

16%

4%

THB Mil.

Non-Resident holding in Government Bond % Share of Government Bond

Today

29%

4%Savings Bond for FIDF

Savings Bond for Deficit

8%

% Share of Government Bond

1999 00 01 02 03 04 05 06 07 08 09 10 11 12 13

Between FY 2002-2011

Average Savings Bond Outstanding is equivalent to 400,xxx THB Mil.

2014 15 16 17

Outstanding size

137,733MB(End of Mar 2014)

90,160MB

31,577MB

-0-25,000MB

366,490MB

424,311MB381,796MB

255,675MB

483,839MB

7%

v v

1%vv

8

To be Updated

8

Gove

rnm

ent B

ond

Auct

ion

Sche

dule

for Q

3/FY

2014

:

LB1

96A

=

(Re-

open

)2.

LB

=

(R

e-op

en

ILB2

83A

=

(R

e-op

en

LB2

96A

=

(R

e-op

en

L

BA37

DA =

(Re-

open

LB4

46A

=

(R

e-op

en

L

B616

A =

(Re-

open

Auct

ion

Date

LB19

6A5-

yrLB

236A

10-y

rILB

283A

15-y

rLB

296A

15-y

rLB

A37D

A25

-yr

LB44

6A30

-yr

LB61

6A50

-yr

Tota

l

2-Ap

r-201

4-

9-Ap

r-201

420

,000

5,000

25,0

00

16-A

pr-2

014

-

23-A

pr-2

014

-

29-A

pr-2

014

10,00

09,0

0019

,000

7-Ma

y-20

14-

14-M

ay-2

014

15,00

015

,000

21-M

ay-2

014

-

28-M

ay-2

014

9,000

9,00

0

4-Ju

n-20

1416

,000

16,0

00

11-Ju

n-20

1420

,000

20,0

00

18-Ju

n-20

14-

25-Ju

n-20

149,0

009,

000

Tota

l40

,000

16,0

005,

000

10,0

0015

,000

9,00

018

,000

113,

000

Coup

on3.8

75%

3.625

%1.2

5%4.8

75%

4.26%

4.675

%4.8

5%

Matu

rity

Date

13-Ju

n-20

1916

-Jun-

2023

12-M

ar-2

028

22-Ju

n-20

2912

-Dec

-203

729

-Jun-

2044

17-Ju

n-20

61

Excl

usi

vity

MO

F O

utr

igh

t P

D O

NLY

Infl

atio

n-L

inke

d B

on

dA

mo

rtiz

ed

Bo

nd

LB1

96

AIL

B2

83

ALB

A3

7D

A

Exclusivity

9

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PU BILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONE ER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINET COMMMITM ENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMEN T OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATIO N BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMEN TS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND P IONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMM ITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGE MENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDI CATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVE MENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BO ND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND ACHIEVEMENTS PUBIL C DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE 10

14 11

27

,13

5

25

,00

0

25

,00

0

25

,00

0

14

,00

6

25

,00

0

25

,00

0

25

,00

0

25

,00

0

25

,00

0

24

,49

1

25

,00

0

19

,27

5

20

,00

0 2

0,0

00

20

,00

0

20

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

15

,00

0

20

,00

0

20

,00

0

20

,00

0

20

,00

0

20

,00

0

20

,00

0

1 M

20

,00

0

20

,00

0

20

,00

0

1.20

1.45

1.031.08

0.56

1.26

1.01

1.63

1.18

2.56

0.98

1.32

0.77

1.021.07

1.53

2.45

2.75

BCR 4.49

1.73

1.91 1.931.79

1.58

2.42

1.27

2.13

2.60

2.60

1.15

-3.9

-4.6-4.2-4.4

-0.5

-2.9

-1.8

-3.0-3.5

-2.9

-1.3

-2.3

-0.8-0.5

1.30.4

-2.2

-3.3

-4.9

-3.7

-2.4

0.6

-1.0

-2.0

-3.9

-2.9-2.5

-5.2

-4.6

-2.5

-8

-4

0

4

8

12

-50,000

-25,000

-

25,000

50,000

75,000

Sep Oct Nov Dec Jan Feb Mar Apr May

Sep 13 Oct 13 Nov 13 Dec 14 Jan 14 Feb 14 Mar 14 Apr 14 May 14 Jun 14


T-Bill Supply

bpsMillion Baht

T-1=0

Q3/FY143

M

20

,00

0

To Meet : Short Term Demand

To Manage : Funding Risk

Wednesday7 May 2014

1M (32 Days) : 20,000 MB3M (95 Days) : 20,000 MB

AllocatedParticipated

Basis Point

FY 2014

12

B: Progress Update

• Greenshoe Option: MOF Outright PDs Privilege in FY2015

• Bond Switching & Consolidation Work Plan

• GGLB Rollover Plan

• Towards ASEAN “Preferred Destination”

Term and Condition:

Exercising at the AAY (Average Accepted Yield) Price

Exercising within 1-2 days next to the auction date (T+1 to T+2)

$$$

Greenshoe Option

Right to buy indicated LB in Additional of 10-20%

of the allocated amount

Upgrade MOF Outright PD Privilege • Maintain Exclusivity in 5-yr• Option Greenshoe Option

Exclusivity in 5-yr tenor of Government Benchmark Bond

MOF Preferred Counterparty Quarterly dialogue with MOF of plan Bond Auction Schedule

Current Pr ivi lege FY 2013-2014

BOT outright counterparty Benefit of Incentive program from SET

Greenshoe Option 5 years10 years

“Potential” Privilege to be launched in FY2015


Note: Under the normal market condition, PDs are expected to exercise Greenshoe option when Market Yield < AAY

13

13

12

11

10

9

8

7

6

5

4

3

2

1

GS 5 Yrs. GS 10 Yrs. Exclu. 10 Yrs. GS 15 Yrs. Exclu. 15 Yrs. GS 7 Yrs. GS 3 Yrs. GS 30 Yrs. Exclu. ILB Exclu. 3 Yrs. GS ILB

1. What is the most preferable Additional Privileges? Please Arrange 1-5 in Space By 1 = Most Prefer 2 = More Prefer

3 = Prefer 4 = Less Prefer

5 = Least Prefer

. .Exclusivity in 10 yr. Benchmark Bond

. .Exclusivity in other Tenor of Benchmark Bond please specific yr. . .Greenshoe Option in 5 yr. Benchmark Bond . .Greenshoe Option 10 yr. Benchmark Bond . .Greenshoe Option in other Tenor of Benchmark Bond please specific yr.

2. Other Privileges

Additional MOF Outright PD Privileges Survey

7 4 22

65

Survey Results for Upgrade MOF Outright PD Privilege (13/13PDs)

Results from All 13 MOF Outright PDs Between 27 Jan 2014 - 13 Feb 2014

1

3

7

2 Most Prefer

Least Prefer

- Greenshoe - Greenshoe

Greenshoe5 Yrs

Greenshoe10 Yrs

Exclusivity10 Yrs

7PDs 11PDs4PDs

2PDs

1st Rank

14

Bond Switching and Bond Consolidation Timeline

Today

Week 4 : Kick-off

• Gathering the Problem and Obstacle• Planning to Eliminate

Meeting with Related Organization

• The Revenue Department• The Securities and Exchange Commission • Federation of Accounting Professions• Commission Office of Insurance Commission

• ThaiBMA• BOT• Others

Set TransactionFormat

• Bond Selection• Calculation

• Exchange Approach

BS & BC Execution

18 Months

FY2014 FY2015

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug

Marketing & Roadshow

Examine the problem and obstacle

BS & BC 1) Capital Gain Tax 2) Accounting 3) (ThaiBMA)4) (BOT)5) AM 6)

BS BC (Long-term Investors)

AM

: ThaiBMA:

Capital Gain Tax Accounting Mark to Market Hold to Maturity Portfolio

ThaiBMA: ThaiBMA: BOT

BS BC (Long-Term Investors)

(Mutual Fund)

The Securities and Exchange Commission

1. Capital Gain Tax The Revenue Department

2. Calculation ThaiBMA 2. Accounting Federation of Accounting Professions

3. Hold to Maturity Portfolio

- The Securities and Exchange

- Commission Office of Insurance Commission


-Tentative-

-

25,000

50,000

75,000

100,000

GG

LB

14

8A

BA

AC

14

OA

GG

LB

14

OA

BA

AC

15

2A

BA

AC

15

2B

GG

LB

15

2A

GG

LB

15

3A

GG

LB

15

6A

GG

LB

15

6B

GG

LB

15

7A

GG

LB

15

7B

GG

LB

15

7C

BA

AC

15

9A

GG

LB

15

9A

GG

LB

15

9B

GG

LB

15

OA

GG

LB

16

2A

GG

LB

16

3A

GG

LB

16

4A

GG

LB

16

6A

BA

AC

16

9A

GG

LB

16

OA

GG

LB

16

NA

GG

LB

16

NB

BA

AC

17

2A

BA

AC

17

9A

BA

AC

18

9A

GG

LB

18

9A

BA

AC

19

2A

BA

AC

19

2B

BA

AC

20

8A

BA

AC

23

8A

BA

AC

23

8B

Roll Over Parallel with SOE Bond Development

Building a Benchmark Issue Bond Under GGLB Code to be Benchmark for SOE Bond

Enhancing Liquidity Re-open GGLB to Build-up Outstanding Size to Enhance Liquidity

Consulting Market Publicize information in all dimensions. To Increase confidence in the market.

GGLB148A20,000 THB Mil. GGLB189A

Coupon 4.02%

GGLB16NACoupon 3.53%

GGLB2XXXCoupon .. %

GG

LB16

NA

A

Super Size

3-Yr Benchmark Bond (re-open)

7-Yr Benchmark Bond (new)

A

GGLB148A

10 Aug 2014

B

C

BC

As of 27 March 2014

GGLB16NA69,580 THB Mil.

BA

AC

14

OA

BA

AC

15

2A

BA

AC

15

2B

BA

AC

15

9A

BA

AC

16

9A

BA

AC

17

2A

BA

AC

17

9A

BA

AC

18

9A

BA

AC

19

2A

BA

AC

19

2B

BA

AC

20

8A

BA

AC

23

8A

BA

AC

23

8B

FY2018-2023FY2017FY2016FY2015

15

-

25,000

50,000

75,000

100,000

GG

LB1

48A

BA

AC

14

OA

GG

LB1

4OA

BA

AC

15

2A

BA

AC

15

2B

GG

LB1

52A

GG

LB1

53A

GG

LB1

56A

GG

LB1

56B

GG

LB1

57A

GG

LB1

57B

GG

LB1

57C

BA

AC

15

9A

GG

LB1

59A

GG

LB1

59B

GG

LB1

5OA

GG

LB1

62A

GG

LB1

63A

GG

LB1

64A

GG

LB1

66A

BA

AC

16

9A

GG

LB1

6OA

GG

LB1

6NA

GG

LB1

6NB

BA

AC

17

2A

BA

AC

17

9A

BA

AC

18

9A

GG

LB1

89A

BA

AC

19

2A

BA

AC

19

2B

BA

AC

20

8A

BA

AC

23

8A

BA

AC

23

8B

Code Name Changed : Almost BAAC are in the scope of GGLB

GGLB = Bonds of Bank for Agriculture and Agricultural Cooperatives. The principal and interest of the Bonds are guaranteed by the Ministry of Finance,

and the Government of Thailand undertakes to make repayments of the principal and interest throughout of the Bonds in all respects

BAAC = Bonds of Bank for Agriculture and Agricultural Cooperatives. The principal and interest of the Bonds are guaranteed by the Ministry of Finance.ปจัจุบนั หลงั 29 มี.ค. 57

BAAC148A GGLB148ABAAC14OA BAAC14OABAAC14OB GGLB14OABAAC152A BAAC152ABAAC152B BAAC152BBAAC152C GGLB152ABAAC153A GGLB153ABAAC156A GGLB156ABAAC156B GGLB156BBAAC157A GGLB157ABAAC157B GGLB157BBAAC157C GGLB157CBAAC159A BAAC159ABAAC159B GGLB159ABAAC159C GGLB159BBAAC15OA GGLB15OABAAC162A GGLB162ABAAC163A GGLB163ABAAC164A GGLB164ABAAC166A GGLB166ABAAC169A BAAC169ABAAC16OA GGLB16OABAAC16NA GGLB16NBGGLB16NA GGLB16NABAAC172A BAAC172ABAAC179A BAAC179ABAAC189A BAAC189ABAAC189B GGLB189ABAAC192A BAAC192ABAAC192B BAAC192BBAAC208A BAAC208ABAAC238A BAAC238ABAAC238B BAAC238B

20,0

00

16,5

00

10,2

00

20,0

00

13,8

00

10,0

00

15,0

00

1,20

0

8,80

0

5,00

0

5,00

0

3,00

0

12,3

00

10,0

00

8,00

0 2,

000

2,00

0

2,00

0

GGLB16NA 69,580

7,00

0

0

25,000

50,000

75,000

100,000

GGLB

148A

BAAC

14O

A

GGLB

14O

A

BAAC

152A

BAAC

152B

GGLB

152A

GGLB

153A

GGLB

156A

GGLB

156B

GGLB

157A

GGLB

157B

GGLB

157C

BAAC

159A

GGLB

159A

GGLB

159B

GGLB

15O

A

GGLB

162A

GGLB

163A

GGLB

164A

GGLB

166A

BAAC

169A

GGLB

16O

A

GGLB

16NB

GGLB

16NA

BAAC

172A

BAAC

179A

BAAC

189A

GGLB

189A

BAAC

192A

BAAC

192B

BAAC

208A

BAAC

238A

BAAC

238B

BAAC 13 20,000GGLB 20 240,380

BAAC 32 191,800GGLB 1 68,580

GGLB = +

BAAC =

-

25,000

50,000

75,000

100,000

BA

AC

148

A

BA

AC

14O

A

BA

AC

14O

B

BA

AC

152

A

BA

AC

152

B

BA

AC

152

C

BA

AC

153

A

BA

AC

156

A

BA

AC

156

B

BA

AC

157

A

BA

AC

157

B

BA

AC

157

C

BA

AC

159

A

BA

AC

159

B

BA

AC

159

C

BA

AC

15O

A

BA

AC

162

A

BA

AC

163

A

BA

AC

164

A

BA

AC

166

A

BA

AC

169

A

BA

AC

16O

A

GG

LB1

6N

A

BA

AC

16N

A

BA

AC

172

A

BA

AC

179

A

BA

AC

189

A

BA

AC

189

B

BA

AC

192

A

BA

AC

192

B

BA

AC

208

A

BA

AC

238

A

BA

AC

238

B

P A S TSeries Outstanding (THB Mil.)

BAAC 32 191,800GGLB 1 69,580


GG

LB

16

NA

P R ES E N T

Now 29-Mar-14

BAAC148A GGLB148A

BAAC14OA BAAC14OA

BAAC14OB GGLB14OA

BAAC152A BAAC152A

BAAC152B BAAC152B

BAAC152C GGLB152A

BAAC153A GGLB153A

BAAC156A GGLB156A

BAAC156B GGLB156B

BAAC157A GGLB157A

BAAC157B GGLB157B

BAAC157C GGLB157C

BAAC159A BAAC159A

BAAC159B GGLB159A

BAAC159C GGLB159B

BAAC15OA GGLB15OA

BAAC162A GGLB162A

BAAC163A GGLB163A

BAAC164A GGLB164A

BAAC166A GGLB166A

BAAC169A BAAC169A

BAAC16OA GGLB16OA

GGLB16NA GGLB16NA

BAAC16NA GGLB16NB

BAAC172A BAAC172A

BAAC179A BAAC179A

BAAC189A BAAC189A

BAAC189B GGLB189A

BAAC192A BAAC192A

BAAC192B BAAC192B

BAAC208A BAAC208A

BAAC238A BAAC238A

BAAC238B BAAC238B

Series Outstanding (THB Mil.)

BAAC 13 20,000GGLB 20 240,380


BA

AC

14

OA

BA

AC

15

2A

BA

AC

15

2B

BA

AC

15

9A

BA

AC

16

9A

BA

AC

17

2A

BA

AC

17

9A

BA

AC

18

9A

BA

AC

19

2A

BA

AC

19

2B

BA

AC

20

8A

BA

AC

23

8A

BA

AC

23

8B

16

IBR

D

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

0

50,000

100,000

150,000

BAHT BOND

Linking CGIF & BAHT BOND to the Development of Bond MarketPublic Debt Management Office, Ministry of Finance, Kingdom of Thailand

Why now?Thailand (PDMO) is a Board member Set criteria Select corporate

What next? Toward becoming regional hub Increasing AAA Supply Broadening Issuer Base : Lao PDR(PDDF.)

Inv’tGrade

TargetedIndustry

NaturalHedging

2013 2014 2015 2016 2017 2018 2019 2020

2,850THB mln.

2005 2006 2007 2008 2009 2010 2011 2012 2013

109,174THB mln.

CGIF Total Outstanding 9.2 THB TrillionEnd of March 2014

Baht Bond(Foreign Issuers Bond)

Corp Bond

SOEs Bond

BOT Bond

GOVT Bond

1%

22%

8%

31%

38%

CGIF 0.03%(For Asian Bond

Market Initiative)

Hana(18,000 m)

KEXIM(30,700 m)

Woori(13,000 m)

IBK(12,300 m)

Citi(11,553 m)

ADB(10,500 m)

KDB

AFD

CABEI

ING(10,000 m)

IBR

D

Timeline For Baht Bond Application Process

* The approval period is based on the fiscal period under Thai government law (October – September)

SUBMISSION CONSIDERATION Issuance Period 9 months (Sep - May)

SUBMISSION CONSIDERATION Issuance Period 9 months (Jan - Sep)

Apr May

SUBMISSION CONSIDERATION Issuance Period 9 months (Jan - Sep)

SUBMISSION CONSIDERATION Issuance Period 9 months (May - Jan)

Oct Nov Dec Jan Feb MarApr May Jun Jul Aug SepNov Dec Jan Feb Mar

1

2

3

1

APPLICATION PROCESS: 3 rounds per year (9-mth issuance period for each round)

Hana

IBK

KDB

KEXIM

Woori

AFD

CABEI

CA-CIB

CBA

Citi

ENBD

ING

SEK

ADB

IBRD

Lao PDR

Noble

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

THE OUTSTANDING BAHT BOND

Classified by issuers based on TTM

Source: PDMOAs of March 31st, 2014

103,434 THB mln.

(36,690)

32%

(27,900)

24%

(22,409)

19%

(3,874)

3%

(9,066)

8%

(3,000)3% (5,000)

4%

(1,500)

1%(2,800)

2%

(2,000)

2%

(2,235)

2%

70%

21%

9%

(71,800 THB mln.)

(22,034 THB mln.)

(9,600THB mln.)

Korean Issuers IFIs & ABMI Others Completely Due(as of March 2014)

IBRD

Hana

KDB

KEXIM

Citi

ENBD

SEK

Hana

KEXIM

IBK

Woori

CA-CIB

THB mln.

56% Due within Y2015(64,590 THB mln.)

36%(13,040)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 … 2020

IFIs

Broadening Issuer’s “Qualification” to achieve “ASEAN Chosen Destination”

Issuer’s GovernmentGuarantee

SPV

Credit Rating

CGIFCGIF / Local Credit Rating

LAOS

TwinInaugural

II

BY TTM BY SECTOR

IIIIIIIIIIIIIIIIIIII

-0-

I

I

COPORATE BOND MARKET CLASSIFICATION

NOBLEAAA

0

150,000

300,000

0

200,000

400,000

ENER

G

BA

NK

PR

OP

FIN

CO

NM

AT

FOO

D

TRA

NS

PE

TRO

CO

MM ICT

AG

RI

SPV

HEL

TH

PA

PER

AU

TO

TOU

R

MED

IA

ETR

ON

0

400,000

800,000

AAA AA A BBB BB 0 – 3 4 – 5 6 – 10 10+

BY CREDITRATING

Possible Next Step? ? ?

17

1 18

C: Basic & Essentials

• Public Debt Outstanding and Its Composition (As of Jan 2014) = 5,466,198 THB Mil. (45.75% of GDP)

• Bond Market Capitalization and Its Composition (As of Mar 2014) = 9,202,573 THB Mil.(76% of GDP)


• GOVT Bond Auction Result in First Half of FY2014


NR Holding in THB Bond (As of Mar 2014) = 679,137 THB Mil.

(GOVT Bond : 559,677 THB Mil., BOT Bond 118,713 THB Mil., Corp Bond : 747 THB Mil.)

Net Change in NR Holding (Jan – Mar 2014) = -28,238 THB Mil.

(GOVT Bond : Net Sell -36,164 THB Mil., BOT Bond : Net Buy +7,926 THB Mil.)

24 19

Forecast Public Debt to GDP

Source: Policy and Planning Bureau, as of 2 January 2014, Public Debt Management Office, Ministry of Finance

14.6%

35.6%

48.3%

60.9%61.7% 60.6%

56.9%

52.2%

51.0%50.6%

43.5% 39.6%

37.3%

45.2%

42.6%

41.7%

45.5%

45.86%

4.84%

9.12%10.87%

12.52%11.54% 11.26%

10.20%

12.61%

9.98%7.41%7.41%

0%

10%

20%

30%

40%

50%

60%

70%

Public Debt to GDP Repayment Budget/Budget Expenditure

Sustainability Framework

Public Debt to GDP < 60%

Balance Budget

% of GDP

Components of Public Debt Units : THB Mil.

1. Government Debt (excluded FIDF) 2,731,161

2. Government Debt (for FIDF) 1,107,240

3. Non-Financial Sate Enterprise Debt 1,090,502

4. Special Financial Institutions Guaranteed Debt 536,460

5. Autonomous Agency Debt 835

Public Debt Outstanding 5,466,198

*including 71,901 THB Mil. of External Debt

Public debt Outstanding (as of January 2014) = 5.47 THB Trillion (45.75% of GDP)


Source : Information Technology Centre, PDMO

GOVT Debt50.0%

2.73 THB Trillion

*

GOVT Debt(for FIDF)

20.3%

1.11 THB Trillion

Non-Financial

Sate Enterprise Debt

19.9%

1.09 THB Trillion

Special Financial Institutions

Guaranteed Debt

9.8%

0.54 THB TrillionAutonomous Agency Debt

0.02%

0.001 THB Trillion

20

Government Funding Instruments

Benchmark Bond ~600,000THB Mil. (52%)

Savings Bond ~100,000THB Mil. (8%)

Amortized Bond ~100,000THB Mil (8%)

Inflation-Linked Bond ~80,000THB Mil. (7%)

Promissory Note ~40,000THB Mil. (4%)

Floating Rate Bond ~30,000THB Mil. (3%)

Bank Loan ~200,000THB Mil. (18%)

Total 1,150,000 THB Mil. (100%)

($20.4 Bil.)

($1.4 Bil.)

($3.5 Bil.)

($1.0 Bil.)

($40 Bil.)

($3.5 Bil.)

($2.8 Bil.)

($7.0 Bil.)

10

3

5

7

2030

Source: ThaiBMA Government Bond Yield Curve as of 31 March 2014

15

50

The “Missing Composition” of Leader role in the Bond Market

Benchmark Bond

Infrastructure

liquidity

Full Capacity* of All Government Funding Instruments 1,150,000 THB Mil. per Year* Under favorable market liquidity + using All funding instruments ($35 Bil.)**

GBI-EM GlobalJP Morgan

Asian Local MarketsHSBC

iBoxx Asia ex JapanMarkit

7.7% 7.8% 7.8%

Thailand’s Loan Bonds (LBs) weighting in international indices


LB 3 yrs 150,000 THB Mil.

LB 5 yrs 120,000 THB Mil.LB 7 yrs 80,000 THB Mil.LB 10 yrs 80,000 THB Mil.LB 15 yrs 60,000 THB Mil.LB 20 yrs 60,000 THB Mil.LB 30 yrs 30,000 THB Mil.LB 50 yrs 20,000 THB Mil.

Benchmark Bond

($4.6 Bil.)

($2.4 Bil.)

($4.0 Bil.)

($1.8 Bil.)

($1.8 Bil.)($0.9 Bil.)($0.6 Bil.)

($2.4 Bil.)

TTM (yrs.)

%

Last Update : Feb 2014

**Source: BOT Exchange rate as End of Mar 2014

**

25

187,

727

242,

222

164,

297

114,

271

123,

704

273,

994

5,78

3

184,

110

80,

02

5

32,

50

0

47,

00

0

192,

730

67,

00

0

2,20

0

41,9

00

33,5

81

6,50

0

71,

00

0

5,50

0

20,0

00

95,

93

6

14,0

00

29,8

00

27,8

00

95,

20

5

58,2

47

86,

63

0

16,

00

0

22,0

00

100,

872

18,9

00

43,0

00

15,7

00

35,0

00

13,2

48

11,2

57

10,0

00

9,25

0

60,0

00

0

100,000

200,000

300,000

40,0

00

58,4

40

39,8

36

141,

963

25,0

00

37,9

00

40,0

00

39,0

00

35,0

00

64,1

24

27,8

87

68,4

41

128,

000

75,0

00

101,

800 69

,000

101,

850

14,0

00

0

100,000

200,000

300,000

41%

26%33%

60%

35%

5%

TTM Fiscal Year

Average-Time-to-Maturity (ATM) = 8yrs 4mths

Average Cost = 4.19%

Fixed : Floating = 87 : 13Total GOVT Debt = 3.77* THB Trillion

Assumptions : 6 months BIBOR = 2.47%, 6 months Fixed Deposit Rate = 1.79%, Inflation = 1.93%

As of Jan 2014

**Excluding 71,901 THB Mil. of Foreign Debt

Public Debt Management Office, Ministry of Finance, Kingdom of Thailand* Excluding 71,901 THB Mil. of Foreign Debt

GOVT Debt (for FIDF) = 1,107,240 THB Mil.

FIDF 1 FIDF 3

Maturity Profile

Budget Deficit T-Bill TKK On-lending Loan Water Decree

GOVT Direct Debt (exclude FIDF) = 2,659,260** THB Mil. Maturity Profile

TTM Fiscal Year

ATM = 4yrs 7mths Avg. Cost = 4.29%

Fixed : Floating = 85: 15

Callable = 13%

ATM = 9yrs 10mths Avg. Cost = 4.15%

Fixed : Floating = 88 : 12

Callable = 8%

44%

25%31%

Next 5 yrs 6-10 yrs 10 yrs +

Next 5 yrs 6-10 yrs 10 yrs +

21 -

54%

28%18%

next 5 yrs year 6 -10 10 yrs +

41%

26%33%

(1) ATM Lengthened(2) Cost Lowered(3) Well-Balanced Fixed-Float Ratio(4) Well-Distributed Maturity Profile

Well-Developed Bond Market Improved

GOV’T Direct Debt Profile Dramatically

Well-Balanced Fixed/Floating Ratio(Target : Fixed/Float ratio = 80 : 20)


Well-Distributed Maturity Profile(Maturing Debt in the next 5 yrs is less than 50% of Total Debt)

Floating 12%Floating 10%

ATM

5yrs 3mths

ATM

9yrs 10mths

Avg. cost

4.5%

As of Dec 2007 As of January 2014

Avg. cost

4.1%

Fixed

90%

Note : Government Direct Debt = 2.66 THB Million (exclude FIDF)

Fixed

88%

Avg. Cost LOWERED by 40 bps.(While ATM Lengthened by 5 yrs)

Average-Time-to-Maturity

LENGTHENED by 5 yrs

next 5 yrs year 6 -10 10 yrs +

41%

26%33%

21 22

0%

20%

40%

60%

80%

100%

120%

140%

Mar

201

4

Bank Loan /GDP Equity/GDP Bond Market / GDP

≤ 1<yr≤3 3<yr≤5 5<yr≤10 10<yr≤50

BOT76%

24%

11%

17%

17%MOF28%

27%

Bond Market Cap. = 9.2 THB Trillion GOVT Bond = 3.4 THB Trillion

101%

76%

Baht Bond

Corp Bond

SOEs Bond

BOT Bond

GOVT Bond

1%

22%

8%

31%

38%

Domestic Bond Market Classified by Issuer% Share of GDP

Maturity Profile

BOT vs GOVT Bond


103%

Asian Fin. Crisis

12%

24%

128%

0.03%

($283 Bil.)* ($107 Bil.)*

2,835,122 THB Mil.

3,492,013 THB Mil.

CGIF(For Asian Bond

Market Initiative)

End of Mar 2014

BOT ATM = 8mths GOVT ATM = 8yrs 4mth

*Source: BOT Exchange rate as End of Mar 2014

0%

10%

20%

30%

40%

50%

60%

Corp Bond

SOEs Bond

BOT Bond

GOVT Bond

1%

22%

8%

38%

Domestic Bond Market 2014Classified by Issuer

3,492,013 THB Mil.



31%

38%

GOVT

2004

Corp Bond 22%

SOEs Bond 8%

31%

BOT

54% (1,286,620 THB Mil.)

13%(312,340 THB Mil.)

Market share rose nearly… 3 Folds Outstanding size rose by… 9 times

BOT Bond Supply Rose Dramatically (2004 – Mar 2014)

CGIF 0.03%

2,835,122 THB Mil.

% Share of Domestic Bond Market

Baht Bond 1%

End of Mar 2014

Mar 2014

22 23

CGIF 0.03%

Corp Bond

22%

Government

38%SOEs

8%

• 77 percent of Thailand’s debt securities are issued by Government, Bank of Thailand and State-Owned EnterprisesIssuers

• 97 percent of Thailand’s debt securities are classified as Investment GradeCredit Rating

• Thailand’s government debt securities are held by a wide group of investor typesInvestors

Domestic Bond Market(Classified by Issuers)

Source : ThaiBMA (End of Mar 2014)

Equilibrium of Domestic Bond Market

Source : ThaiBMA (End of Mar 2014)


Domestic Bond Market(Classified by Credit Rating)

BOT

31%

Total of 9.2 THB Trillion Total of 9.2 THB Trillion

Baht Bond 1%

AA 4%

A 8%

Government

38%

BOT

31%

SOEs8%

BBB

2%

Non-rated3%

Source : BOT (End of Feb 2014)

Government Debt Securities (Classified by Types of Investors)

Total of 3.4 THB Trillion


BOT 6%

Insurance and

Other Corporation

36%

DepositoryCorporation

33%

NR17%

Household and

Non-profit

BOT 6%

Insurance and

Other Corporation

36%

DepositoryCorporation

34%

NR17%

7%

• Allow both issuer and investors to improve their portfolio

• Larger outstanding size + Less bond series Enhance liquidity in the secondary market

• Suitable financing instrument for the government’s investment mega-project in the form of PPP • Pay back the bond principal by installments Promote the government’s fiscal discipline

FY2007 – FY2014 Innovation of GOVT Debt SecuritiesFY

20

07

-10

FY 2

01

1

• Broaden investor base – Retail investors• Low interest burden at the initial periods of bond

• Increase floating debt ratio of Total Government Debt Portfolio • Promote BIBOR (Bangkok Interbank Offered Rate)

• Lengthen average-time-to-maturity of Total Government Debt Portfolio• Meet Long-term investors’ demand

FY 2

01

2-2

01

4

PDDF Activated(Public Debt Restructuring

and Domestic Bond Market Development Fund)

UpgradePD Privileges

Baht Bond

CGIF Activated(Credit Guarantee and

Investment Facility)

Step-up Savings Bond

Floating Rate Bond

30-yr Benchmark Bond

• Lower Minimum Amount to Purchase / Offer throughout the year• Develop the retail bond into an electronic form Scripless System• Can be purchased via ATM, in addition of Bank Retail Branches

• Strong anti-inflationary signal• Deepen the Development of the Bond market

• 1st country in Emerging Asian Economies

• Combat low interest rate + Lengthen average time-to-maturity

• 4th country in the world (1st : UK 2nd : France 3rd : China)50-yr Benchmark Bond

Electronic Retail Savings Bond

10-yr Inflation-Linked Bond (ILB)

• Broaden investor base – Insurance / Long-term investors• Non-Benchmark tenorsFixed Rate Promissory Note

Bond Switching & Consolidation

Amortized Bond


15-yr ILB

24

1. 1. Trading Volume 2. Turnover Ratio3. 3. Demand Concentration 4. Auction Price

75%

84%

76%77%

80%

14.713.7

12.8

7.5

+1.2 bps

+1.4 bps

-0.4 bps

+3.2 bps

7%

FY2008-FY2013 Key Success Indicators

Benchmark Bond 5 yrs and Below : Highest secondary trading volume in every year

Top 10 GOVT Bond Series : Accounted for 90% of all GOVT bond trading volume in secondary market

Well-Developed Benchmark Bond Pays Off : Even with greater size of issuance, the cost of funding is still at market rate

Unit: USD Bil.

27%

20%

28%

20%

Unit: % Share of Market Trading Volume

Unit: % Share of Secondary Trading Volume

5-yr Benchmark Bond’s Higher Turnover Ratio : Even the higher outstanding size, turnover ratio is still more than 2 times

LB15DA

LB155A

LB145B

LB133A

LB133A9


29%

LB176A

1.5

3.12.4

4.2

2.8

4.2

90%

+0.9 bps

16.5

21%

90%

2.9

LB196A

15.9

-0.2 bps

Unit: Times

To be Updated

23

0

50,000

100,000

150,000

200,000

250,000

300,000LB

196

A

LB17

6A

LB21

DA

LB23

6A

LB15

5A

LB15

DA

LB14

5B

LB61

6A

ILB

217A

LB41

6A

LB18

3B

LBA

37D

A

LB29

6A

LB17

OA

LB27

DA

LB19

3A

LB21

3A

LB32

6A

ILB

283A

LB28

3A

LB16

NA

LB19

8A

LB16

7A

LB23

3A

LB26

7A

LB24

DA

LB19

1A

LB14

DA

LB17

5A

LB25

DA

LB31

6A

LB17

1A

LB21

4A

LB19

DA

LB15

7A

LB24

4A

LB22

NA

LB18

3A

LB40

6A

LB44

6A

LB14

5A

LB39

6A

LB38

3A

Ou

tsta

nd

ing

size

(TH

B M

il.)

Tier 1: >100,000MB(9 Series)

Tier 2: 50,000 – 100,000MB(15 Series)

5

10

15

LB

27

DA

LB

23

6A

LB

21

DA

ILB

28

3A

LB

17

6A

LB

44

6A

LB

19

3A L

B6

16

A

LB

A3

7D

A

15

ILB

Tier 1 > 100,000 THB Mil. in Size (90% of Trading Volume)

LB

29

6A

Tier 2 > 50,000 THB Mil. in Size (8% of Trading Volume)

FY 2014 on-the-run Benchmark Bond


50

Total GOVT Bond = 43 Series(3,021,XXX THB Mil.)

(as of Q2/FY2014)

LB

19

6A

30

25

LBA

THB Mil.

Source : ThaiBMA

FY2014 Q2 Market Share of Trading Volume in Secondary Market

Tier 2

0 50 100

Tier 1

90% 8% 2%8%

FY 2014 on-the-run Innovative Bond

100,000

25

-

50,000

100,000

150,000

200,000

250,000

300,000

LB14

5A

LB14

5B

LB14

DA

LB15

5A

LB15

7A

LB15

DA

LB16

7A

LB16

NA

LB17

1A

LB17

5A

LB17

6A

LB17

OA

LB18

3A

LB18

3B

LB19

1A

LB19

3A

LB19

6A

LB19

8A

LB19

DA

LB21

3A

LB21

4A

ILB

217A

LB21

DA

LB22

NA

LB23

3A

LB23

6A

LB24

4A

LB24

DA

LB25

DA

LB26

7A

LB27

DA

ILB

283A

LB28

3A

LB29

6A

LB31

6A

LB32

6A

LBA

37D

ALB

383

ALB

396

ALB

406

ALB

416

ALB

446

A

LB61

6A


TTM

Source : ThaiBMA

Well-Distributed Bond Maturity Profile(as of Q2/FY2014)

Current Outstanding ≤ THB 50 Bil.

FY 2014 on-the-run Benchmark Bond

Current Outstanding ≥ THB 100 Bil.

Current Outstanding = THB 50-100 Bil.

5

10

1515

ILB

50

30

LB

27

DA

LB

23

6A

LB

21

DA

ILB

28

3A

LB

17

6A

LB

44

6A

LB

61

6A

LB

A3

7D

A

LB

29

6A

LB

19

6A

1 2 543 6 – 10 years 11 – 50 years

FY 2014 on-the-run Innovative Bond

THB Mil.

100,00025

LBA

The outstanding size of loan bond maturing in the next 5 years

is 1,069,019 THB Mil. (35% of Total GOVT Bond)

13

181,

994

115,

850

55,0

00

50,0

00

54,0

00

50,0

00

81,2

05

120,

000

82,0

00

25,0

00 58,0

00

55,0

00

50,0

00

0

100,000

200,000

300,000

5-yr

Government Bond Supply7 Fixed Coupon Bonds5 Benchmark Bonds Series1 Inflation-Linked Bond1 Amortized Bond

LB24

6A

10

15 30 50LBA25

AB

Option C Top-up 120,000MB on LB196A (301,994MB)

Milestone Thai’s First 10 Billion USD bond

C

Ou

tsta

nd

ing

size

(TH

B M

il.)

PD Survey (9/13 responded)

5 10

FY 2014

5

15

25

ILB

50

30

FY 2014 Indicative Benchmark Bond

10


15

LB1

96

A

LB2

36

A

ILB

28

3A

LB2

96

A

LBA

37

DA

LB4

46

A

LB61

6A

300,000MB

($10 Billion)

Super size

Plan-to-issue Amount in FY 2014

Outstanding Amount as of the beginning of FY 2014

15-yrInflation-Linked Bond

25-yrAmortized Bond

26

Total Fund Raising Plan 610,xxx THB Mil.Last Updated: March 2014

RolloverFIDF Debt

RolloverGovt Debt

Deficit

Benchmark Bond(5 - 15 - 30 - 50-yr)

Benchmark Bond (10-yr)

Inflation Linked Bond

Amortized Bond – 25 years

Savings Bond and Others

Promissory Notes

278,000

82,000

Savings Bond

Dollar Bond

Non-Benchmark

New Product

123,000

55,00025,000

47,124

250,000

231,000

129,124

By Bills By Instruments

Infrastructure

137,xxx

(As of Sep 25th,2013)

New

Bo

rro

win

g 25

0,00

0 M

B.

Ro

ll O

ver

360,

124

MB

387,xxx MB

360,124 MB

9,xxx

PlannedDisbursement

9,xxx MB

FY 2014

Depending on Disbursement Plan and Uncertainty of Legisiative Process

Firm Bond Supply among uncertainty of Political Conflict

Q: Will the “pause” of the

Water Decree and Infrastructure Bill affect the Announced Government Bond Supply?

A: No, they will not.

The Water Decree and Infrastructure Bill were planned to be raised through short-term “Bank Loan” which provide more flexibility and cost saving. Then, they will be converted to long-term instrumentlater.


Savings Bond Dollar BondNon-Benchmark

New Product

Bank Loan6 mths – 4 yrsInfrastructure

Water

21

27

20,000 7,000 5,000 13,000 5,000 5,000 20,000 8,000 12,000 10,000 12,000 9,000 4,160 10,000 20,000 9,000 13,000 16,000 9,000

2.7

-6.1

-8.3

3.9

-15.0

0.8

-0.4

-9.6

-5.4

3.2 2.9

-7.8

6.3

-7.0

-1.2

-8.1

-5.4

-0.2

-8.9

-15

-10

-5

0

5

10

15

-75,000

-50,000

-25,000

-

25,000

50,000

75,0006

No

v 1

3

6 N

ov

13

13

No

v 1

3

20

No

v 1

3

27

No

v 1

3

3 D

ec

13

11

De

c 1

3

11

De

c 1

3

18

De

c 1

3

8 J

an

14

29

Ja

n 1

4

29

Ja

n 1

4

5 F

eb

14

12

Fe

b 1

4

19

Fe

b 1

4

19

Fe

b 1

4

26

Fe

b 1

4

19

Ma

r 1

4

26

Ma

r 1

4

Public Debt Management Office, Ministry of Finance

Q2/FY14

Basis Points

FY 2014 Government Bond Auction ResultClassified by Quarterly Auction Schedule

Million Baht

FOMC : QE3 Tapered @29 Jan 14

MPC : Maintain 2.25% @22 Jan 14

Dissolution of Parliament

@9 Dec 13

MPC cut rate@27 Nov 13

FOMC : QE3 Tapered

@18 Dec 13

LB5y LB5yLB10y LB10yLB15y LB15yLB50y LB50yLB30y LB30yILB15y ILB15yLBA25y LBA25yLB15y LB50y

MPC cut rate@27 Nov 13

Dissolution of Parliament

@9 Dec 13

FOMC : QE3 Tapered

@18 Dec 13

Q1/FY14

LB10y LB30yLB5y

Dissolution of the parliament

GOVT Bond Auction is decoupledfrom political situation

Bid Tight

5-10 yr Benchmark BondAmortized Bond

15-30-50 yr Benchmark Bond Inflation-linked Bond

T-1= 0

Basis Points

20,000 20,000 20,000 13,000 12,000 16,000 7,000 10,000 10,000 5,000 9,000 9,000 5,000 8,000 9,000

2.7

-0.4-1.2

3.9

2.9

-0.2

-6.1

3.2

-7.0

-15.0

-7.8

-8.9-8.3

-9.6

-8.1

-15

-10

-5

0

5

10

15

-25,000

-20,000

-15,000

-10,000

-5,000

-

5,000

10,000

15,000

20,000

25,000Benchmark Bond 5 – 10yr Benchmark Bond 15 – 50yr

Public Debt Management Office, Ministry of Finance

FY 2014 GOVT Bond Auction Results Classified by Tenor

A

B

Basis Points

5yr(Exclusivity)

10yr 15yr 30yr 50yr

T-1= 0

A u c t i o n R e s u l t s B e l o w T h e M a r k e t P r i c e

5.0

2.5

7.5

10.0

12.5

-10.0

-12.5

-7.5

-5.0

-2.5

Million Baht Basis Points

ALL Benchmark Bond : Fully Allocated

30-to-50-yr Benchmark Bond : Avg.Accepted LOWER than Market Price

B

A

F u l l y A l l o c a t e d

T-1= 0

5-10 yr Benchmark Bond 15-30-50 yr Benchmark Bond Basis Points

28 28

Ver

bal

Inte

rven

tio

n4

Me

asu

res

of

Cap

ital

Co

ntr

ol

2014 (The past 13 weeks)

Tapering QE3-to-dateTotal Outflow = 83,437 Mil.

(BOT = 52,050 Mil.)(GOVT = 31,387 Mil.)

0

THB Mil.

+7,926 THB Mil.

BOT Bond

-36,164 THB Mil.

GOVT Bond

2014

YTD in Non-resident Holding BOT Bond & GOVT Bond

End of Mar 2014

+

+ +

+

GOVT Bond

2007-09 : Net outflow = 43,xxxMB

GOVT

BOT

THB Mil.

2010-13 : Net inflow = 650,xxxMB

Net Change in Non-Resident Holding (YTD)

Net Outflow = -28,238 THB Mil.

0

To be Updated

BOT : Net Buy +7,926 MB. Sell -26,727 MB. Buy +34,653 MB.

GOVT : Net Sell -36,164 MB. Sell -48, 902MB. Buy +12,738 MB.

2013 YTD(27 Dec 2013)

Non-resident Net Buy/Sell in BOT Bond

Non-resident Net Buy/Sell in GOVT

2013 : Net outflow= -3,7xxMB

End of Mar 2014

-28,238 THB Mil.

BOT Bond

+7,926

-36,164GOVT Bond

2014 YTD(End of Mar 2014)

29 29

0%

10%

20%

30%

40%M

ar-0

8

Jun

-08

Sep

-08

Dec

-08

Mar

-09

Jun

-09

Sep

-09

Dec

-09

Mar

-10

Jun

-10

Sep

-10

Dec

-10

Mar

-11

Jun

-11

Sep

-11

Dec

-11

Mar

-12

Jun

-12

Sep

-12

Dec

-12

Mar

-13

Jun

-13

Sep

-13

Dec

-13

Mar

-14

NR Holding in Thai GOVT Bond is 559,677 THB Mil.

or 16% of Total GOVT Bond Outstanding

PeersComparison

Percentage share of Non-resident Holding in Local Government Bond (Mar 2008 - Present)

1%

(27,424 THB Mil.)

Source : AsianBondsOnline, ThaiBMA

As of Aug 30th 2013

Relatively “moderate” share of NR holding by region average

To be Updated

Total of 3.4 THB Trillion


End of Mar 2014

Malaysia29.4%Dec’ 13

Thailand16%

End of Mar’ 14

Korea9.5%Sep’13

Indonesia

32.54%Dec’ 13

Japan8.02%Dec’ 13

Peak @ 19.1%(Apr’ 13)

2008 2009 2010 2011 2012 2013 2014

IssuerNon-Resident Holding

(THB Million)% Share of Thai Bond Market Cap.

(9,202,573 THB Million)

GOVT Bond 559,677 6.08%

BOT Bond 118,713 1.29%

SOE Bond 0 0%

Corp Bond 747 0.01%

TOTAL 679,137 7.38%

2,751,454

264,768

Non-resident Holding in THB Bond = 679,137 THB Mil.(7.38% of Thai Bond Market Capitalization)

Thai Bond Market Cap. = 9,202,573 THB Mil.

Classified by Issuer (End of March 2014)

2,716,409 THB Mil.

%

95.8%

GOVT Bond Outstanding3,492,013 THB Mil.

BOT Bond Outstanding2,835,122 THB Mil.


Corp Bond

SOEs Bond

BOT Bond

GOVT Bond

1%

22%

8%

31%

38%

2,835,122 THB Mil.

3,492,013 THB Mil.

Non-Resident118,713 THB Mil.

Non-Resident559,677 THB Mil.

Domestic Investors

2014 Outstanding(% share of Bond Market)

CGIF 0.03%(For Asian Bond Market Initiative)

As of Aug 23rd 2013

End of Mar 2014

%

Domestic Investors

84%

2,932,336 THB Mil.

็ ฒ

Bond Market Development Bureau, Public Debt Management Office Ministry of Finance, Kingdom of Thailand

For Further Information :

Pimpen Ladpli +66 2271 7999 ext. 5802 [email protected] Senior Expert on Bond Market Development

Acting Executive Director of Bond Market Development Bureau

Nattakarn Boonsri +66 2271 7999 ext. 5803 [email protected] Director of Government Bond Market Development Division

Sophida Sritomya +66 2271 7999 ext. 5804 [email protected]

Director of Fund Management and Bond Market Infrastructure Development Division

Nakarin Prompat +66 2271 7999 ext. 5812 [email protected] Acting Director of International Bond Market Policy Division

Chakrit Phothisuk +66 2271 7999 ext. 5811 [email protected] Economist

Kasirat Suwanpen +66 2271 7999 ext. 5806 [email protected] Economist

Phimonphan Tanwattana +66 2271 7999 ext. 5816 [email protected] Economist

Kittiya Chaithep +66 2271 7999 ext. 5809 [email protected] Economist

Chanikarn Chaiyasena +66 2271 7999 ext. 5818 [email protected] Economist

Pathida Rattanapinyo +66 2271 7999 ext. 5801 [email protected]

Economist

Chularat Suteethorn Director-General, Public Debt Management Office

Suwit Rojanavanich Bond Market Advisor

Documents

Kingdom of Thailand Bond Market - PDMO Bond Market Booklet Q3 FY2… · Kingdom of Thailand Bond Market ... Savings Bond & Money Expo 2014 ... Retail Investor holding in Government