Krungsri partners with Next Capital launching Thailand's first THOR reference rate for long-term loan deals in response to BOT policy

Mr. Prakob Phiencharoen, Krungsri Head of Corporate and Investment Banking Group said, "Krungsri partners with Next Capital Public Company Limited to implement THOR interest reference rate for 500 million baht long-term loans deal along with THOR reference derivative contract. This is regarded as Krungsri' s achievement in implementing Thailand's first THOR interest reference rate for long-term loans transaction after BOT has initiated THOR (Thai Overnight Repurchase Rate) as Thailand's interest reference rate in order to accommodate the termination of interest reference rates to London Interbank Offered Rate (LIBOR) and Thai Baht Interest Rate Fixing (THBFIX). According to BOT's guideline, THBFIX reference rate to new loan and bond transactions are advised to be ceased from 1 July 2021 onwards."

Mr. Kenichi Nishii, Krungsri Head of Global Markets Group said, "THOR interest rate is to utilize secured overnight financing rate, making it a low credit risk funding rate mechanism. The calculation is based on the actual overnight repurchase rate so it provides a reliable interest rate reference. Thus, it reflects actual Thailand's financial market condition and offers a less degree of fluctuation in comparison to THBFIX. Besides, THOR interest rate has also corresponded to the trend of Thailand's interest rate policy. Krungsri intends to promote transactions that apply THOR in order to be in line with BOT policy to strengthen Thailand's financial market stability, to promote the popularity of THOR application, and to contribute as one of the mechanisms to efficiently enhance the Thai financial market. Moving forward, Krungsri will also continue to develop a diverse range of financial innovations in correspondence with this national policy."

Mr. Sura Khanittaweekul, Chief Executive Officer of Com7 Public Company Limited and Director of Next Capital Public Company Limited, said, "Our company is greatly honored to be part of the development of Thailand's efficient financial market according to the BOT policy. Furthermore, this contractual derivative has well corresponded to the risk management policy of the company and is regarded as one of the paths to sustainable growth."

Mrs. Alisara Mahasandana, Assistant Governor, Financial Markets Operations Group, Bank of Thailand (BOT), said "The initiative of loan transactions with THOR and contractual derivatives between Krungsri and Next Capital Public Company Limited has demonstrated the readiness of our participants. This also is considered a key milestone of Thai financial market in the development of THOR interest reference rate that will replace THBFIX interest reference rate moving forward. BOT would like to show appreciation and thank Krungsri together with Next Capital for your valuable cooperation with BOT in enhancing liquidity and promoting the application of THOR interest reference rate. In particular, this is the first transaction of long-term loan with THOR interest reference rate in Thailand. On behalf of BOT, we truly hope to see higher popularity of transactions with reference to THOR in Thai financial market in the near future".

About Krungsri
Krungsri (Bank of Ayudhya PCL and its group companies) is the fifth largest financial group in Thailand in terms of assets, loans, and deposits, and one of Thailand's five Domestic Systemically Important Banks (D-SIBs) with 76 years of history in the country. Krungsri is a strategic member of the Mitsubishi UFJ Financial Group (MUFG), Japan's largest financial group and one of the world's largest financial organizations. Krungsri provides a comprehensive range of banking, consumer finance, investment, asset management, and other financial products and services to individual consumers, SMEs, and large corporations through 665 domestic branches (626 Banking Branches and 39 Auto Business Branches) and over 32,216 service outlets nationwide. The Krungsri Group is the largest card issuer in Thailand with 9.5 million credit cards, sales finance, and personal loan accounts in its portfolio; a major automobile financing service provider (Krungsri Auto); one of the fastest growing asset management companies (Krungsri Asset Management); and a pioneer in microfinance (Ngern Tid Lor).

Krungsri is strongly committed to the highest level of integrity in conducting its business. All Krungsri Group companies have been awarded accreditation from the Private Sector Collective Action Coalition Against Corruption (CAC) in collaboration with industry peers and stakeholders on a zero tolerance approach to corruption.

About MUFG (Mitsubishi UFJ Financial Group, Inc.)
Mitsubishi UFJ Financial Group, Inc. (MUFG) is one of the world's leading financial groups. Headquartered in Tokyo and with over 360 years of history, MUFG has a global network with around 2,600 locations in more than 50 countries. The Group has over 180,000 employees and offers services including commercial banking, trust banking, securities, credit cards, consumer finance, asset management, and leasing. The Group aims to "be the world's most trusted financial group" through close collaboration among our operating companies and flexibly respond to all of the financial needs of our customers, serving society, and fostering shared and sustainable growth for a better world. MUFG's shares trade on the Tokyo, Nagoya, and New York stock exchanges. For more information, visit https://www.mufg.jp/english.

• ข่าวBank of Thailand
• ข่าวBank of Ayudhya
• ข่าวo:editor
• ข่าวo:fin
• ข่าวo:loc