kingdom of thailand bond market development

$ 6 Bil

20

30

50

OCTOBER 2012

3

10

7

5

Kingdom of Thailand Bond Market Development

P/N

P/N

P/N

9 yr A T M

SB

ILB

SB

GOVT Debt Folio

S u s t a i n a b i l i t y

50% 20% 30%

15

ILB

$ 3 Bil

O u t s t a n d i n g S i z e

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE 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. Evolution of Bond Market Development (1995 – Present)

B. Building up of Benchmark Bond (FY2007 - FY2012)

C. Bond Supply FY2013 + Funding Needs FY2013 - FY2015

D. Well-Developed Bond Market Improved Government Debt Profile Dramatically

2

12

6

19

• 1997 Asian Financial Crisis The Rude Awakening

• Thai Bond Market Has Grown Strongly and Rapidly for More than a Decade

• Innovation of Government’s Debt Securities

• Equilibrium of Thai Bond Market

• PDMO Revised the Strategies of Benchmark Bond Issuance in 3 Ways

• Keep Our Word to Get Investors Confidence for the Plan Firm Committed Supply of Benchmark Bond Regardless of Budget Uncertainty

• Key Success Indicators of Benchmark Bond Liquidity

• Market’s Favorite Benchmark Bond

• FY 2013 Total Funding Needs (by Bills) 1,028,219 THB mil.

• FY 2013 Total Fund Raising (by Instruments) 1,095,219 THB mil.

• FY 2013 Benchmark Bond (3-5-7-10-15-20-30-50 tenors) 525,000 THB mil.

• FY 2013’Q1 Government Bond Auction Schedule 150,500 THB mil.

• Fund Raising Strategies Building Benchmark Bond to Stabilize Yield Curve Segmenting Investors Base to Diversify Dependency Risk

•Next Phase of Inflation Linked Bond Creating Liquidity & Extending Yield Curve

• Full Capacity of Government Funding Instruments (FY 2013) 1,150,000 THB Mil (equiv. 40,000 USD Bil)

• Systematic Benchmark Bond Issuance Lengthened ATM by 3 ½ years Lowered cost by 30 basis points Enhanced fixed-float Ratio Reduced bunching risk

Domestic Bond Market Development

FIDF Decree passed : reduced fiscal burden by 70,000 MB a year (though Public Debt remains unchanged)

PDDF activated : restructuring of FIDF’s 340,122 MB saved over 7,000 MB a year & enhanced overall FIDF portfolio profile

CGIF activated : to enable investment-grade ASEAN+3 issuers to access foreign currency bond markets

Founding 13 MOF-outright PD : upgrading PD duties & privileges to actively play role as market makers

Electronic Retail Savings Bond : to promote savings society & to diversify Government funding instruments

FY 2012 HIGHLIGHTS

23

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE 01

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

A. Evolution of Bond Market Development (1995 – Present)

• 1997 Asian Financial Crisis The Rude Awakening

• Thai Bond Market Has Grown Strongly and Rapidly for More than a Decade

• Innovation of Government’s Debt Securities

• Equilibrium of Thai Bond Market

02

2011-12201020092008 FY 2013

30-yearBenchmark Bond

10-yearInflation Linked Bond

12-year and 18-year

Fixed-ratePromissory Note

5-year

Step-upSavings Bond

3-yearElectronic Retail

Savings Bond

4-yearFloating Rate Bond

April 23nd 2008

FY

50-yearBenchmark Bond

July 15th 2009

6-year

Step-upSavings Bond

July 27th 2009

June 7th 2010

December 22nd 2010

July 11th 2011

September 12th 2011

March 2th 2011

FY 2013 Domestic Bond Market DevelopmentPublic Debt Management Office, Ministry of Finance, Kingdom of Thailand

• To Enhance Liquidity • To Broaden Investor Base • To Strengthen Fiscal Sustainability

Q1

Q2

H2

3

0%

20%

40%

60%

80%

100%

120%

140%

2012

(Ju

n)

Bank Loan /GDP Equity/GDP Bond Market / GDP

< 1y 2-3y 3-5y 6-10y 11-50y

62%

33%

5%

14%

22%

17% 26% 21%

Bond Market Cap. = 8.2 THB Trillion GOVT Bond = 3.1 THB Trillion

Asian Fin. Crisis

128%

24%

12%

90%

84%

71%

Baht Bond

Corp. Bond

SOE Bond

BOT Bond

GOVT Bond

1%

19%

7%

35%

38%

Domestic Bond Market Classified by Issuer% Share of GDP

2.9 THB Trillion

3.1 THB Trillion

Maturity Profile

BOT vs GOVT Bond

BOT

MOF

BOT ATM = 1yr GOVT ATM = 7yrs 6mths

$280 Bil. (Aug 2012)


($100 bil)

($280 Bil.) ($100 Bil.)

0%

20%

40%

60%

80%

100%

120%

140%

2012

(Ju

n)

Bank Loan /GDP Equity/GDP Bond Market / GDP

1997 Asian Financial Crisis The Rude AwakeningPublic Debt Management Office, Ministry of Finance, Kingdom of Thailand

Asian Fin. Crisis

128%

24%

12%

90%

84%

% Share of GDP

8.2 THB Trillion31 August 2012

71%

Balanced

4

0%

20%

40%

60%

80%

100%

0

2

4

6

8

10

201

2 (

Au

g)

% o

f G

DP

71%

Post Crisis – 2000 : Volume Oriented Bond Market Capitalisation tripled Government Bonds

Outstanding grew by 50 times Government Bond Market

Share jumped from 3% in 1997to 44% in 2000

2007 – 2010 : Development Oriented Regular Benchmark Issuance New Product Development Regular Market Dialogue

with BoT and PDs

Pre-Crisis- Illiquid Bond Market- Absence of Benchmark Bond- Dominated by SoE’s Bonds

Next Step 2011-13:

(Market Deepening Oriented) 50-yr Bond, ILB, Electronic Retail Bond Upgrade PD Privileges Regional Linkage (CGIF) Amortised Bond Bond Switching & Bond Consolidation

The Thai Bond Market has Developed Rapidly and EfficientlyThe Thai Bond Market Has Developed Rapidly and Efficiently TH

B T

rilli

on


• Allow both issuer and investors to improve their portfolio

• Larger outstanding size + Less bond series more 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 – FY2013 Innovation of GOV’T Debt Securities

FY 2

00

7-1

0FY

20

11

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

• Increase floating debt ratio of Total Government Debt Portfolio 10% to 18%*• Promote BIBOR (Bangkok Interbank Offered Rate)

• Lengthen average-time-to-maturity of Total Government Debt Portfolio 5yrs 7mths to 7yrs 6mths • Meet Long-term investors’ demand

FY 2

01

2-2

01

3

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

Amortised Bond


From 2007 - 2012

15-yr ILB

5

• 81 percent of Thailand’s debt securities were issued by Government, Central bank and State-owned EnterprisesIssuers

• 98 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

Thailand Bond Market(Classified by Issuers)

State Agencies Debt Securities (Classified by Types of Investors)

Thailand Bond Market(Classified by Credit Rating)

Central Bank

35%

Non-rated2%

BBB

1%A

7%AA

4%

AAA

4%

SOEs

7%

Government

38%

Insurance and

Other Corporation

32%

DepositoryCorporation

39%

Householdand

Non-profit

NR10%

CB 10%

Source : CB (30 June 2012)

Government

38%

Central Bank

35%

SOEs

7%

Private Sector

19%

Source : ThaiBMA (31 August 2012)

9%

Equilibrium of Thai Bond Market

Source : ThaiBMA (31 August 2012)


Baht Bond1%

6

• PDMO Revised the Strategies of Benchmark Bond Issuance in 3 Ways

• Keep Our Word to Get Investors Confidence for the Plan Firm Committed

Supply of Benchmark Bond Regardless of Budget Uncertainty

• Key Success Indicators of Benchmark Bond Liquidity

• Market’s Favorite Benchmark Bond

B. Building up of Benchmark Bond (FY2007 - FY2012)Public Debt Management Office, Ministry of Finance, Kingdom of Thailand

7

FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13

FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13

2550 ต ต ด ,

I. Reduce Auction Frequency from Once a Week to Every Other Month(to Create Even Distribution of the Benchmark Bond Supply over the Year)

PDMO Revised the Strategy of Benchmark Bond Issuance in 3 ways (FY2007-FY2013)

III. Increase Outstanding Size(by Re-opening)

II. Increase Auction Size

40,000

4,000

Unit : THB Mil

Unit : THB Mil

50,000-80,000

12,000-15,000

Tenors: 3-5-7-10 yrs

Tenors: 3-5-7-10 yrs

80,000-100,000

100,000-120,000

100,000-120,000

120,000-150,000

150,000-200,000

6,000-8,000

8,000-10,000

10,000-12,000

15,000-20,000

15,000-20,000


500 -700 Mil.USD

5-7 Bil.USD

8

31

0,0

00

60

,00

0

17

0,0

00

28

1,0

00

26

1,1

71

30

9,8

26

13

1,0

00

82

,23

3

15

4,0

00

32

1,1

71

0

100,000

200,000

300,000

400,000

Benchmark Bond Non Benchmark Bond Savings Bond T-Bill (Outstanding) Others

Plan Actual

Benchmark Bond Non Benchmark Bond Savings Bond T-Bill (Outstanding) Others

Plan Actual

Keep Our Word to get Investor Confidence for the Plan

Firm Committed Supply of Benchmark BondRegardless of Budget uncertainty

Higher government

funding needs due to

Stimulus Package

approx.+250,000 THB Mil.

FY2009

Lower Borrowing needs

due to Economic Recovery

approx. -160,000 THB Mil.

FY2010

Total Funding needs

increased from:

420,000 THB Mil. to

670,000 THB Mil.

(+59%)

Total Funding needs

decreased from:

800,000 THB Mil to

640,000 THB Mil

(-20%)

THB Mil.

+2%+170%

+33%

+40%

+86%

+118%

-51%

-45%

0% +8%

Treasury Balance = 417,166 THB Mil.



THB Mil.

34

9,5

00

95

,00

0

-

20

4,0

00

9,0

00

19

0,5

14

45

,00

0

17

7,7

70

33

9,9

00

70

,00

0

1,0

75

12

5,6

91

40

,00

0

54

,01

4

34

,60

0

14

9,1

10

0

100,000

200,000

300,000

400,000

BenchmarkBond

NonBenchmark

Bond

Savings Bond T-Bill(Outstanding)

ILB Float P/N Fixed P/N Bank Loan(Outstanding)

Plan Actual

33

0,0

00

19

9,1

10

10

0,0

00

30

,00

0

60

,00

0

12

5,1

22

45

,00

0

40

0,0

00

34

5,7

51

11

0,8

50

37

,35

9

64

,65

9

52

,18

0

12

0,2

31

88

,24

9

30

,03

0

0

100,000

200,000

300,000

400,000

BenchmarkBond

NonBenchmark

Bond

Savings Bond T-Bill(Outstanding)

ILB Float P/N Fixed P/N Bank Loan(Outstanding)

Plan Actual

FY2012

-44%

+5%

Treasury Balance = N/A

+116%-92%-4%

-13%+96%

Lower-than-expected

Disbursement


Total Funding needs

decreased from:

1,140,000 THB Mil to

750,000 THB Mil

(-34%)

Total Funding needs

decreased from:

700,000 THB Mil to

450,000 THB Mil

(- 36%)

Keep Our Word to get Investor Confidence for the Plan

Firm Committed Supply of Benchmark BondRegardless of Budget uncertainty

FY2011


Bond Market Development Bureau, Public Debt Management Office

Higher than expected

Revenue collection


-3%

+344%-26%

-16%-38% -72% -23%

-63%

THB Mil.

THB Mil.

FY07 FY08 FY09 FY10 FY11 FY12(Aug)



FY08 FY09 FY10 FY11 FY12 F

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

75%

84%

76%77%

80%

14.713.712.8

7.5

+1.2 bps

+1.4 bps

-0.4 bps

+3.2 bps

7%

FY2008-FY2012 Key Success Indicators

5-yr Benchmark Tenor : Highest Secondary Trading Volume in

every year (accounted for 25% of total trading volume)

Top 10 Gov’t Bond Series – Accounted for 90% of all Gov’t Bond trading in Secondary Trading Volume

Well developed Benchmark Bond pays off : Even with greater size of issuance, the cost of funding is still at market rate

Unit: Billion USD

27%

20%

28%

20%

Unit: % share of Market Trading Volume


5 yr Benchmark Bond : Higher Turnover Ratio

LB15DA

LB155A

LB145B

LB133A

LB133A

9


18%

LB176A

1.5

3.12.4

4.2

2.8

4.0

90%

+0.9 bps

16.5

5-yr 5-yr 5-yr 5-yr 5-yr

9




FY08 FY09 FY10 FY11 FY12 F

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

75%

84%

76%77%

80%

14.713.712.8

7.5

+1.2 bps

+1.4 bps

-0.4 bps

+3.2 bps

7%

FY2008-FY2012 Key Success Indicators

5-yr Benchmark Tenor : Highest Secondary Trading Volume in

every year (accounted for 25% of total trading volume)

Top 10 Gov’t Bond Series – Accounted for 90% of all Gov’t Bond trading in Secondary Trading Volume

Well developed Benchmark Bond pays off : Even with greater size of issuance, the cost of funding is still at market rate

Unit: Billion USD

27%

20%

28%

20%



5 yr Benchmark Bond : Higher Turnover Ratio

LB15DA

LB155A

LB145B

LB133A

LB133A

9


18%

LB176A

1.5

3.12.4

4.2

2.8

4.0

90%

+0.9 bps

16.5

5-yr 5-yr 5-yr 5-yr 5-yr

0.00

1.00

2.00

3.00

4.00

0

50000

100000

150000

LB17

6A

LB21

DA

LB15

5A

LB15

DA

LB19

3A

LB13

3A

LB27

DA

LB14

5B

LB17

OA

ILB

217A

LB16

5A

LB13

7A

LB32

6A

LB14

5A

LB19

6A

LB12

NA

LB61

6A

LB23

6A

LB41

6A

LB25

DA

LB18

3B

LB16

NA

LB14

3A

LB21

3A

LB29

6A

LB24

DA

LB23

3A

LB14

DA

LB31

6A

LB28

3A

LB15

7A

LB16

7A

LB19

1A

LB17

5A

LB24

4A

LB17

1A

LB13

OA

LB26

7A

LB19

8A

LB18

3A

LB19

DA

LB40

6A

LB21

4A

LB22

NA

LB38

3A

LB39

6A

0.00

1.00

2.00

3.00

4.00

0

50,000

100,000

150,000

4

All 3-5-7-10 on-the-run Benchmark Bond Has Turnover Ratio between 2.5 – 4.0(while market turnover ratio = 1)

Turnover Ratio

Current Outstanding ≤ 50,000 MB

Outstanding ≥ 100,000 MB

LB193A

LB15DA

LB155A

LB176A

LB21DA

Current Outstanding 50,000-100,000 MB

3.1

2.6 2.6

FY2012 Market’s Favorites

Classified by Turnover Ratio

5 710 3 3

15 20 305010

2.5

Turnover Ratio 0.2 – 1.0

3

2

1

Nearly No Trading

4.0

FY 2012 on-the-run Benchmark Bond


10

FY-to-date Market Share of Trading Volume in Secondary Market (Oct 11-Sept 12)

4

10

0

50000

100000

150000

LB1

55

A

LB1

5D

A

LB1

45

B

LB2

1D

A

LB1

76

A

LB1

96

A

LB1

33

A

ILB

21

7A

LB1

83

B

LB1

7O

A

LB1

93

A

LB2

13

A

LB2

83

A

LB1

6N

A

LB1

98

A

LB4

16

A

LB1

67

A

LB1

37

A

LB2

33

A

LB2

96

A

LB2

67

A

LB2

4D

A

LB1

91

A

LB1

4D

A

LB2

36

A

LB1

75

A

LB2

5D

A

LB3

16

A

LB6

16

A

LB2

14

A

LB1

71

A

LB1

43

A

LB1

9D

A

LB1

57

A

LB2

7D

A

LB1

2N

A

LB3

26

A

LB2

44

A

LB1

65

A

LB2

2N

A

LB1

83

A

LB1

3O

A

LB4

06

A

LB1

45

A

LB3

96

A

LB3

83

A

3 3 2 10 5 7 1 10 6 5 7 9 16 4 7

Ou

tsta

nd

ing

size

(TH

B M

il.)

% %

Top 5(>100,000)

Next 10(50,000-100,000)

TTM (Year)

3

20

5

30

7

10

15

LB155A

LB15DA

LB21DA

ILB217A

LB176A

LB416A

LB193A

LB616A

LB27DA

LB165A

4

FRB

ILB

TOP 5 > 100,000 THB Mil in Size (70% of Trading Volume)

50

3

LB326A

FY2012 Total GOVT Bond = 46 Series(2,2511,XXX THB Mil) Next 10 > 50,000 THB Mil in Size (20% of Trading Volume)

TOP 5

70%

Next 10 Bottom 30

20% 10%

FY-to-date Market Share of Trading Volume in Secondary Market (Oct 11-Sept 12)

0 50 100

FY 2012 on-the-run Benchmark Bond


10

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE 11

12

C. Bond Supply FY2013 + Funding Needs FY2013 - FY2015

• FY 2013 Total Funding Needs (by Bills) 1,013,546 THB mil.

• FY 2013 Total Fund Raising (by Instruments) 1,090,076 THB mil.

• FY 2013 Benchmark Bond (3-5-7-10-15-20-30-50 tenors) 525,000 THB mil.

• FY 2013’Q1 Government Bond Auction Schedule 150,500 THB mil.

• Fund Raising Strategies Building Benchmark Bond to Stabilize Yield Curve

Segmenting Investors Base to Diversify Dependency Risk

•Next Phase of Inflation Linked Bond Creating Liquidity & Extending Yield Curve


13

232,575 200,666

344,084 300,000

200,000

100,000

25,000 52,000

157,503

199,239

219,222

139,171 113,014

340,122 166,543

129,124

75,171

260,000

58,940 20,838

10,000

340,000

500

49,500

(250,000)

-

250,000

500,000

750,000

1,000,000

FY2010 FY2011 FY2012 FY2013F FY2014F FY2015F

• Deficit 300,000• Deficit Restructuring 157,503• FIDF Restructuring 166,543• Water 340,000• Insurance 49,500


DeficitDeficit Restructuring

FIDF RestructuringTKKTKK Restructuring Water Management Decree

Insurance Decree

FY2013 Total Funding Needs(By Bills)

656,746 424,620 694,706 1,013,546 528,363 415,234

THB Mil.

AnnualFunding Needs(THB Mil.)

1,013,546 THB Mil.

TENTATIVE

232,575 200,666

344,084 300,000

200,000

100,000

25,000 52,000

157,503

199,239

219,222

139,171 113,014

340,122 166,543

129,124

75,171

260,000

58,940 20,838

10,000

340,000

500

49,500

18,00057,000

124,254

28,3095,782

82,230

117,600 128,272 19,530

(250,000)

-

250,000

500,000

750,000

1,000,000

FY2010 FY2011 FY2012 FY2013F FY2014F FY2015F

• Deficit 300,000• Deficit Restructuring 157,503• FIDF Restructuring 166,543• Water 340,000• Insurance 49,500• Pre-Mature FIDF 57,000• Pre-Mature TKK 19,530


DeficitDeficit Restructuring

FIDF RestructuringTKKTKK Restructuring Water Management Decree

Insurance Decree

Pre-Mature TKK RestructuringPre-Mature FIDF ConversionT-Bill Conversion (Bill to Bond)

FY2013 Total Fund Raising Plan(By Bills)

656,746 424,620 694,706 1,013,546 528,363 415,234

863,230 570,529 846,760 1,090,076 528,363 415,234

THB Mil.

Annual Funding Needs (THB Mil.)

Annual Fund Raising (THB Mil.)

1,090,076 THB Mil.

TENTATIVE

14

10

0,0

00

99

,99

4

11

1,1

10

90

,87

2

44

,00

0

35

,00

0

35

,00

0

53

,43

6

41

,20

5

90

,00

0

90

,00

0

80

,00

0

10

,00

0

85

,00

0

50

,00

0

50

,00

0

40

,00

0

40

00

0

-

50,000

100,000

150,000

200,000

To Reach 100,000 THB Mil. in Outstanding Amount

by the End of FY2013

ALL FY2013 Benchmark Bond Series(3 – 5 – 7 – 10 – 15 - 20 – 30 - 50 yr + 10 yr ILB)


Ou

tsta

nd

ing

size

(TH

B M

il.)

FY 2013 Indicative Benchmark Bond

Plan-to-issue Amount in FY2013

Outstanding Amount as of the beginning of FY2013

LB176A

LB196A

LB21DA

LB236A

LB27DA

LB326A

LB616A

LB416A

5 7

10

3

15 20 50100,000

30ILB10

ILB217A

TENTATIVE

(3.3 bil.USD)

FY 2013 Total Fund Raising Plan(by Instruments and Bills) 1,090,076 THB Mil.

Public Debt Management Office, Ministry of Finance, Kingdom of ThailandLatest Version

Restructuring 157,503

Deficit 300,000

FIDF 166,543

Water Decree 340,000

Insurance Decree 49,500

Float P/N 31,503

45

7,5

03

SB 6,000

By Bills By Instruments

Fixed P/N 40,000

Benchmark Bond (5 - 7 - 15 - 20 - 30 - 50 yr)

340,000

Pre-Mature FIDF 57,000 Pre-Mature TKK 19,530

ILB 10 yr 10,00022

3,5

43

Other 44,530

ILB 15 yr 40,000NEW

Bank Loan 6 mth – 4 yr

Savings Bond

ILB

Non-Benchmark

(Mini-Tender)

P/N

Global Bond(Now – June 2013)

Benchmark Bond (3 & 10 yr)

185,000

Float P/N 3,543

Unit:

THB

Mil.

03-O

ct-1

2-

10

-Oct

-12

-

17-O

ct-1

2-

24

-Oct

-12

11,50

0

11

,500

31-O

ct-1

29,0

00

8,000

17

,000

07-N

ov-1

210

,000

12,00

0

22

,000

14-N

ov-1

213

,500

7,500

21

,000

21-N

ov-1

213

,000

10,00

0

23

,000

28-N

ov-1

27,0

00

7,000

05-D

ec-1

2-

12

-Dec

-12

13,00

0

9,0

00

22,00

0

19

-Dec

-12

19,00

0

8,0

00

27,00

0

26

-Dec

-12

-

Tota

l30

,500

13,00

0

10

,000

25,00

0

13

,500

18,00

0

10

,000

15,50

0

15

,000

150,5

00

Coup

on3.2

5%3.8

75%

1.20%

3.65%

3.625

%3.5

8%3.7

75%

3.80%

4.85%

Mat

urity

Dat

e16

-Jun-

1713

-Jun-

1914

-Jul-2

117

-Dec

-21

16-Ju

n-23

17-D

ec-2

725

-Jun-

3214

-Jun-

4117

-Jun-

61หม

ายเห

ต :

1. LB

176A

= พ

นธบต

รรฐบ

าลเพ

อการ

ปรบโ

ครงส

รางห

น (พ

.ร.ก.

ชวยเ

หลอก

องทน

เพอก

ารฟน

ฟฯ ระ

ยะทส

อง) ใ

นปงบ

ประม

าณ พ

.ศ. 2

556

ครงท

1 (R

e-op

en พ

นธบต

รรฐบ

าลเพ

อการ

ปรบโ

ครงส

รางห

น (พ

.ร.ก.

ชวยเ

หลอก

องทน

เพอก

ารฟน

ฟฯ ระ

ยะทส

อง)

ในปง

บประ

มาณ

พ.ศ.

2555

ครง

ท 2)

2. LB

196A

= พ

นธบต

รรฐบ

าลเพ

อการ

บรหา

รหน

ในปง

บประ

มาณ

พ.ศ.

2556

ครง

ท 2

(Re-o

pen

พนธบ

ตรรฐ

บาล

ในปง

บประ

มาณ

พ.ศ.

2552

ครง

ท 13

)

3. ILB

217A

= พ

นธบต

รรฐบ

าลปร

ะเภท

อตรา

ดอกเ

บยแป

รผนต

ามกา

รเปลย

นแปล

งของ

เงนเฟ

อ ใน

ปงบป

ระมา

ณ พ

.ศ. 2

556

ครงท

1 (R

e-op

en พ

นธบต

รรฐบ

าลปร

ะเภท

อตรา

ดอกเ

บยแป

รผนต

ามกา

รเปลย

นแปล

งของ

เงนเฟ

อ ใน

ปงบป

ระมา

ณ พ

.ศ. 2

554)

4. LB

21DA

= พ

นธบต

รรฐบ

าล ใน

ปงบป

ระมา

ณ พ.

ศ. 25

56 ค

รงท

3 (Re

-ope

n พน

ธบตร

รฐบา

ล ใน

ปงบป

ระมา

ณ พ.

ศ. 25

54 ค

รงท

4)

5. LB

236A

= พ

นธบต

รรฐบ

าลเพ

อการ

ปรบโ

ครงส

รางห

น (พ

.ร.ก.

ชวยเ

หลอก

องทน

เพอก

ารฟน

ฟฯ ระ

ยะทส

อง) ใ

นปงบ

ประม

าณ พ

.ศ. 2

556

ครงท

2 (R

e-op

en พ

นธบต

รรฐบ

าลเพ

อการ

ปรบโ

ครงส

รางห

น (พ

.ร.ก.

ชวยเ

หลอก

องทน

เพอก

ารฟน

ฟฯ ระ

ยะทส

อง)

ในปง

บประ

มาณ

พ.ศ.

2553

ครง

ท 1)

6. LB

27DA

= พ

นธบต

รรฐบ

าล ใน

ปงบป

ระมา

ณ พ.

ศ. 25

56 ค

รงท

1 (Re

-ope

n พน

ธบตร

รฐบา

ล ใน

ปงบป

ระมา

ณ พ.

ศ. 25

55 ค

รงท

3)

7. LB

326A

= พ

นธบต

รรฐบ

าล ใน

ปงบป

ระมา

ณ พ.

ศ. 25

56 ค

รงท

4 (Re

-ope

n พน

ธบตร

รฐบา

ลเพอ

การป

รบโค

รงสร

างหน

(พ.ร.

ก. ให

อ านา

จกระ

ทรวง

การค

ลงกเ

งนฯ

พ.ศ.

2552

) ในป

งบปร

ะมาณ

พ.ศ.

255

5 คร

งท 1

)

8. LB

416A

= พ

นธบต

รรฐบ

าลเพ

อการ

บรหา

รหน

ในปง

บประ

มาณ

พ.ศ.

2556

ครง

ท 1

/ พนธ

บตรร

ฐบาล

ในปง

บประ

มาณ

พ.ศ.

2556

ครง

ท 5

(Re-o

pen

พนธบ

ตรรฐ

บาล

ในปง

บประ

มาณ

พ.ศ.

2554

ครง

ท 2)

LB61

6ATo

tal

Gove

rnm

ent B

ond

Auct

ion

Sche

dule

for Q

1/FY

2013

Auct

ion

date

LB17

6ALB

196A

ILB21

7ALB

21DA

LB23

6ALB

27DA

LB32

6ALB

416A

Excl

usi

vity

M

oF

Ou

trig

ht

PD

On

ly

Web

site

htt

p:/

/ww

w.p

dm

o.g

o.t

h/

15

Symbol Avg. Bidding Yield

(%) Change Yield (bp) Avg. Bid-Offer Spread (bp) Maturity TTM (yrs.)

T-BILL1M 2.923841 2 4 0.076712

T-BILL3M 3.024104 1 3 0.249315

T-BILL6M 3.046427 1 3 0.498630

T-BILL1Y 3.037068 2 3 1.000000

LB13OA 3.113636 0 5 17/10/2013 1.043836

LB143A 3.147273 0 6 05/03/2014 1.424658

LB145B 3.153636 0 3 12/05/2014 1.610959

LB145A 3.158182 0 4 14/05/2014 1.616438

LB14DA 3.173636 0 5 03/12/2014 2.172603

LB155A 3.171364 0 2 22/05/2015 2.638356

LB157A 3.194545 0 5 07/07/2015 2.764384

LB15DA 3.182727 0 3 11/12/2015 3.194520

LB167A 3.250909 0 5 27/07/2016 3.821918

LB16NA 3.270000 0 6 18/11/2016 4.134246

LB171A 3.304545 0 5 18/01/2017 4.301370

LB175A 3.311818 -1 5 26/05/2017 4.652055

LB176A 3.288182 -2 2 16/06/2017 4.709589

LB17OA 3.332727 -1 4 10/10/2017 5.027397

LB183A 3.404545 -1 6 07/03/2018 5.432877

LB183B 3.408182 -1 6 13/03/2018 5.449315

LB191A 3.467273 -1 6 12/01/2019 6.284932

LB193A 3.453636 -2 3 08/03/2019 6.435616

LB196A 3.481818 -3 5 13/06/2019 6.701370

LB198A 3.511818 -3 6 13/08/2019 6.868493

LB19DA 3.523636 -2 6 03/12/2019 7.175343

LB213A 3.544545 -2 6 31/03/2021 8.501369

LB214A 3.555455 -2 6 09/04/2021 8.526028

LB21DA 3.509091 -3 3 17/12/2021 9.216438

LB22NA 3.592727 -1 7 08/11/2022 10.109590

LB233A 3.631818 -1 6 13/03/2023 10.452050

LB236A 3.612727 -2 4 16/06/2023 10.712330

LB244A 3.698182 0 8 09/04/2024 11.528770

LB24DA 3.719091 -1 8 20/12/2024 12.227400

LB25DA 3.777273 -2 7 12/12/2025 13.205480

LB267A 3.797273 -2 7 07/07/2026 13.772600

LB27DA 3.812727 -2 7 17/12/2027 15.219180

LB283A 3.882727 -1 7 13/03/2028 15.457530

LB296A 3.926364 -1 7 22/06/2029 16.734250

LB316A 3.982727 0 7 20/06/2031 18.728770

LB326A 4.020909 0 7 25/06/2032 19.745200

LB383A 4.077273 0 8 13/03/2038 25.463010

LB396A 4.110909 0 8 13/06/2039 26.715070

LB406A 4.144545 1 8 22/06/2040 27.742470

LB416A 4.196364 0 10 14/06/2041 28.720550

LB616A 4.302727 -1 10 17/06/2061 48.742470

TTM (Yrs.) Yield (%)

0.08 2.92

0.25 3.02

0.50 3.05

1 3.04

2 3.17

3 3.19

4 3.26

5 3.33

6 3.45

7 3.52

8 3.54

9 3.52

10 3.58

11 3.64

12 3.71

13 3.77

14 3.80

15 3.81

16 3.90

17 3.93

18 3.96

19 3.99

20 4.02

21 4.03

22 4.04

23 4.05

24 4.06

25 4.07

26 4.09

27 4.12

28 4.16

29 4.20

30 4.20

31 4.21

32 4.21

33 4.22

34 4.22

35 4.23

36 4.24

37 4.24

38 4.25

39 4.25

40 4.26

41 4.26

42 4.27

43 4.27

44 4.28

45 4.28

46 4.29

47 4.29

48 4.30

Remark

1) The above yields are based upon average bids quoted by primary dealers .

2) Average bidding yields of 1-month, 3-month, 6-month and 1-year T-bills are bond equivalent yield converted from average simple yields. 3) Spreads (bp) are differences bid and offer yields. 4) The cut-off time for daily quotation of T-bills and Government bonds is 16:00. 5) The highlighted rows are on-the-run benchmark bond.

FY2013 Indicative Benchmark Bond

16

17

Fund Raising Plan Strategies

FY 2013 Full Capacity* : 1,150,000 THB MilWell Diversified Investors Ensures Funding Needs

Potential Demandfor Gov’t Bond 2013

Outstanding of Foreign DebtEquiv. 47,000 THB Mil (1.4% of Gov’t Debt)

Commercial PapersSamurai bond 5 yr 20,000 Yen MilSamurai bond 7 yr 10,000 Yen MilMTN 40 USD Mil

Soft LoansJBIC 62,500 Yen MilADB 200 USD MilIBRD 63 USD MilOther 19 USD Mil

Equiv. 13,000 THB Mil Equiv. 34,000 THB Mil

• To diversify portfolio of government debt

• To keep the presence of KOT Bond (Kingdom of Thailand) in the foreign market

• To maintain KOT Bond as a reference benchmark yield for Thai private sector issuers

• To avoid crowding out effect on domestic bond market

(as of Jun 2012) Concerns : exchange rate risk / swap cost / natural hedging

* Under favorable market liquidity + using All funding instruments

- Life Insurance - Pension Funds

SB

Bank loanFRB / LB

P/NLB

Depository Corporations

- Retail - Non-profit org.

Non-Residence

LB 5/10ILB

?

450

450

THB Bil.

200

Insurance and

Other Corporation

32%

DepositoryCorporation

39%

NR10%

CB 10%

Source : CB (30 June 2012)

9%

Householdand

Non-profit

3

5

710

15

20

30

50

LB 3 yr 150,000 THB Mil.








Benchmark Bond

Savings Bond ~100,000 THB Mil. (9%)

Promissory Note ~100,000 THB Mil. (9%)

Inflation-Linked Bond ~50,000 THB Mil. (4%)

Floating Rate Bond ~50,000 THB Mil. (4%)

Bank Loan ~200,000 THB Mi (18%)

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

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

Fixed Rate Promissory Note ~50,000 THB Mil. (4%)

Full Capacity* of All Government Funding Instruments 1,150,000 THB Mil. * Under favorable market liquidity + using All funding instruments



• Building Benchmark Bond to Stabilized Yield Curve• Diversifying Investor Base to Reduce Dependency Risk

18

Next Phase of Inflation Linked Bond in FY2013• Enhance Liquidity of 10-yr• Extending Yield Curve to 15-yr• PDS’ Responsibilities As Market Marker


PDS’ RESPONSIBILITIES

FY2012

• Re-open the Existing Tenor (10-yr ILB : ILB217A)

• Put ILB Auction into Government

Regular Auction Table (Quarterly)

FY2013

• Re-open ILB217A to Build up to 100,000 THB Mil.

Source : Budget DeficitTiming : Dec 2012 – Feb 2013Tenor : 15 years

• Maintain portion of successful bid in primary market • Maintain portion of ILB trading in secondary market• Provide firm bid / ask spreads in secondary market

Source : Water DecreeTiming : Mar 2013 – Jun 2013Tenor

Option A Option BNew 5 years Re-open

ILB217A (7 years )

• Participate in the Primary Market• Provide Bid – Offer Price

• Continue to re-open ILB217A in Q1/FY’13 to build up outstanding size of 100,000 THB Mil.

• Build Up ILB new tenor to around 40,000 THB Mil. (Syndication & Auctions)

• Option A : Issue new tenor of ILB • Option B : Re-open the existing tenor

Keep Our Promise 10-yr ILB (ILB217A)

Extending Yield Curve New 15-yr ILB

Fund Raising Instrument for Water Decree• New 5-yr ILB• Top-up Existing Tenor

By June 2013(Q3/FY’13)

Up To 60,000 THB Mil.

Structure of Thai Inflation Linked Bond (Inaugural ILB, July 2011)

Capital Indexed Bond (with Principle Protection)Format

Every 6 monthsInterest Payment

Thai BahtCurrency

40,000 THB Mil. (1.3 bil USD equiv.)Programme Size

10 yearsTenor

3 monthsIndexation Lag

Headline CPIIndex

1.2Real Yield

CPIt /CPI0 (TBMA’s calculation)Index Ratio

BulletRepayment Method

15,000 MB

5,000 MB

20,000 MB

LocalInstitutions

Local Retail

ForeignInstitutions

Allocations

Next Step Enhance ILB liquidity

Subscription : approx. 1.6 times

Continuing Issuance

PD’s responsibility

FY 2012 : Develop regular annual auction plan (every quarter)FY 2012 : Top-up the existing tenor to enhance liquidity : 60,000 THB Mil. (2 USD Bil equiv.)

(15,000 THB Mil. each in Feb Apr Jun and Aug)FY 2013 : Issue other Benchmark tenors (5-15years ILBs)

FY 2012 : Maintain portion of successful bid in ILB primary marketFY 2013 : Maintain portion of ILB trading in secondary marketFY 2013 : Provide firm bid / ask spreads in secondary market

Enhance Liquidity


Best Sovereign Bond 2011 : Asiamoney Awards

Best Thailand Deal 2011 : Asiamoney Awards Best Local Currency Bond 2011 : FinanceAsia Achievement Awards Best Thailand Deal 2011 : FinanceAsia Achievement Awards Thailand Capital Markets Deal of the Year 2011 : IFRAsia Asia Awards Deal of the Year from Asia : Euro Money

Outstanding Issuer of the Year : Asset Asian Awards 2011 The Most Impressive Local Currency 2011 : Euroweek Asia

Deal of the Year 2011 : ThaiBMAMost Creative Issue 2011 : ThaiBMA

8 International AWARDS

+2 Domestic

AWARDS

19

D. Well-Developed Bond Market Improved Government Debt Profile

• Public Debt Outstanding (as of Dec 2011) = 4.8 THB Trillion (42% of GDP)

• Total GOV’T Debt (Direct + FIDF) = 3.46 THB Trillion (71% of Public Debt)

• Average-Time-to-Maturity (ATM) = 7yrs 6mths

• Average Cost = 4.4%

• Fixed : Float = 86 : 14

• Well-Developed Bond Market Improved GOV’T Direct Debt Profile Dramatically• Average-Time-to-Maturity (ATM) = 8yrs 9mths• Average Cost = 4.2%

• Fixed : Float Ratio = 87 : 13

• Maturity Distribution Profile = 50-20-30

• Full Capacity of All Government Funding Instruments (FY2013) 1,150,000 THB Mil

•Maturity Profile of GOV’T Funding Instruments (Strategic Framework)

• Average-Time-to-Maturity (ATM) = 9yrs• Fixed : Float = 70 : 30

• Maturity Distribution Profile = 50-30-20


020

Special Financial Institution Guaranteed Debt

5%

0.25 THB Trillion

Public Debt Outstanding (as of Jun 2012) = 4.8 THB Trillion (42% of GDP)

GOV’T Debt

47%

GOV’T Debt (for FIDF)

26%

1.25** THB Trillion

Non-Financial State Enterprise Debt

21%

1.03 THB Trillion

Components of Public Debt Units : THB Mil.

1. Government Debt (excluded FIDF) 2,259,073**

2. Government Debt (for FIDF) 1,247,276**

3. Non-Financial State Enterprise Debt 1,028,750

4. Special Financial Institutions Guaranteed Debt 246,437

5. Autonomous Agency Debt (VP and EFPO) 10,000

Public Debt Outstanding (as of Jun 2012) 4,791,536*Including 47,275 THB Mil. of External Debt**Including 113,800 THB Mil. of Prefunding

2.26 THB Trillion


Autonomous Agency Debt (VP and EFPO)

1%

0.01 THB Trillion

next 5 yrs year 6 - 10 10yrs +next 5 yrs year 6 - 10 10yrs +

(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 (1.87 THB Mil.) Profile Dramatically

Float 13%Float 10%

ATM

5yrs 3mths

ATM

8yrs 9mths

Avg. cost

4.5%

As of Dec 2007 As of Jun 2012

Average-Time-to-Maturity

LENGTHENED by 3 ½ yrs

Avg. Cost LOWERED by 30 bps .(While ATM Lengthened by 3 ½ yrs)

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

Avg. cost

4.2%


Maturity Profile as of Dec 2009 Maturity Profile as of Jun 2012

Well-Distributed Maturity ProfileTarget Reached : Maturing Debt in the next 5 yrs

is less than 50% of Total Debt

61%

24% 15%

50%

20%30%

Fixed

87%

Fixed

90%

21

65

,00

0

58,4

40

39,8

36

162,

099

25,0

00

37,9

00

40,0

00

35,0

00

211,

023

98,3

20 64

,124

16,7

31

71,0

03

46,0

00

75

,00

0

86,8

00 69

,000

32,0

00

14,0

00

-

100,000

200,000

300,000

90,0

00

232,

003

20

1,7

70

21

9,2

22

157,

000

93,8

30

86,6

32

145,

994

96,1

10

76,7

00

32,5

00

47,0

00

88,9

50

50,0

00

41,9

00

6,50

0

5,00

0

5,50

0 20,0

00

47,4

36 27

,800

28,2

05

30,3

60

78,1

70

86,6

30

16,0

00

10,0

00

77,1

80

18

,90

0

43,0

00

15,7

00

23,0

00

8,00

0 4,74

7

58

-

100,000

200,000

300,000

Average-Time-to-Maturity (ATM) = 7yrs 6mths

Average Cost = 4.4%

Fixed : Float = 86 : 14

Total GOV’T Debt = 3.46* THB Trillion

(71% of Public Debt)

ATM = 5yrs 4mths Avg. Cost = 4.8%


FIDF 1 FIDF 3

GOV’T Debt (for FIDF) = 1.25* THB Trillion

Assumptions : 6 months BIBOR = 3.23%, 6 months Fixed Deposit Rate = 2.55%

Maturity Profile

As of Jun 2012

**Including 113,800 THB Mil. of Prefunding

ATM = 8yrs 9mths Avg. Cost = 4.2%


GOV’T Debt (exclude FIDF) = 2.21*** THB Trillion

Budget Deficit TKK On-lending Loan Insurance Decree

TTM Fiscal Year

0000Maturity Profile

***Excluded 47,275 THB Mil. of Foreign Debt

Public Debt Management Office, Ministry of Finance, Kingdom of Thailand* Excluded 47,275 THB Mil. of Foreign Debt

As of June 2012

TTM Fiscal Year

next 5 yrs year 6 - 10 10yrs +

next 5 yrs year 6 - 10 10yrs +

30%20%

50%

5%

45%50%

10

,00

0

10

,00

0

30

,00

0

25

,00

0

25

,00

0

25

,00

0

25

,00

0 5

0,0

00

50

,00

0 1

00

,00

0

50

,00

0

50

,00

0

10

,00

0

90

,00

0

-

50,000

100,000

150,000

1 5 6 10 11 15 20 25 30 40 50

15

0,0

00

12

0,0

00

80

,00

0

80

,00

0

60

,00

0

60

,00

0

30

,00

0

20

,00

0

-

50,000

100,000

150,000

1 5 6 10 11 15 20 25 30 40 50

FY2012 Maturity Profile of GOV’T Funding Instruments

(Strategic Framework)(A) ATM = 9 yrs (B) Fixed : Float = 70 : 30

(C) Maturity Distribution Profile 50 - 30 - 20

30% (6-10 yrs)

350,000 THB Mil

Benchmark BondATM 10yrs 8mthsCost (Avg. past 3 yrs) +5 bpsFixed : Float 100 : 0

1510753 20 30 50

5,0

00

5,0

00

30

,00

0

25

,00

0

25

,00

0

25

,00

0

25

,00

0 5

0,0

00

50

,00

0 1

00

,00

0

50

,00

0

50

,00

0

10

,00

0

90

,00

0

-

50,000

100,000

150,000

1 5 6 10 11 15 20 25 30 40 50

Fixed P/N

P/N

ILB

FRB

Bank Loan

Savings Bond

20% (≥ 11 yrs)

220,000 THB Mil

Not-to-Collide with Benchmark Tenors

ATM 7yrs 2mthsCost (Avg. past 3 yrs) + 80 bpsFixed : Float 65 : 35

Alternative Instruments

Public Debt Management Office, Ministry of Finance, Kingdom of Thailand50% (≤ 5 yrs)

580,000 THB Mil

22

3

5

710

15

20

30

50









Benchmark Bond

Savings Bond ~100,000 THB Mil. (9%)

Promissory Note ~100,000 THB Mil. (9%)

Inflation-Linked Bond ~50,000 THB Mil. (4%)

Floating Rate Bond ~50,000 THB Mil. (4%)

Bank Loan ~200,000 THB Mi (18%)

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

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

Fixed Rate Promissory Note ~50,000 THB Mil. (4%)

Full Capacity* of All Government Funding Instruments 1,150,000 THB Mil. * Under favorable market liquidity + using All funding instruments


($5 bil.)

($3 bil.)

($4 bil.)

($2 bil.)

($2 bil.)

($1 bil.)

($0.8 bil.)

($3 bil.)

($20 bil.)

($1.5 bil.)

($3 bil.)

($1.2 bil.)

($40 bil.)

($3 bil.)

($1.5 bil.)

($7 bil.)

($40 Bil.)

Funding Instruments

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMMITMENT 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 COMMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BE

FIDF Decree passed : reduced fiscal burden by 70,000 MB a year (though

Public Debt remains unchanged)

PDDF activated : restructuring of FIDF’s 340,122 MB saved over 7,000 MB

a year & enhanced overall FIDF portfolio profile

CGIF activated : to enable investment-grade ASEAN+3 issuers to access

foreign currency bond markets

Founding 13 MOF-outright PD : upgrading PD duties & privileges to

actively play role as market makers

Electronic Retail Savings Bond : to promote savings society & to diversify

Gov’t funding instruments

23

FY 2012 HIGHLIGHTS

FIDF3 = 693,327MB FIDF3 = 669,857MB

263,178

FIDF2 = 112,000MB

-

13,789

FIDF1 = 500,000MB

FIDF1 = 463,275MB

393,535

-

500,000

1,000,000

1,500,000

FIDF principle debt at initial period (FY'1997,2002)

FIDF principle debt outstanding

at end of FY'2012

cummulative interest payment at end of FY'2012

GOV'T Debt 2,215,727MB

GOVT Debt (for FIDF)

1,133,973MB

Non-Financial State Enterprise Debt

1,033,898MB

Special Financial Institutions

Guaranteed Debt

195,230MB

Other State Agencies , 8,820

24

FIDF Decree Passed PDDF Activated

MB

MB

MB

MB


What Can We Do with 70,000 THB Mil. A Year?

% Shares of Investment Budget to Budget Expenditures

41%

19%

13%

Option 1 :

Increase Investment

Budget

Option 2 :

Increase Principle

RepaymentBudget

10%

5%

% Share of Allocated Principle Repayment to Budget Expenditures (Paid Debt)

% Share of Unallocated Principle Repayment to Budget Expenditures (Rollovered Debt)

PA

ID

UN

PA

ID

% Share of Total Budget Expenditures

% Share of Total Budget Expenditures

Option 1 : To Strengthen Economic GrowthOption 2 : To Strengthen Fiscal Discipline

25%

3%3%

8%

0.06%

3%

7%

5%

2.3%1%

2.6%

25

50

,00

0

39

,12

5

35

,87

0

46

,53

7

42

,95

5

58

,23

3

57

,71

9

66

,91

7

69

,21

7

69

,67

9

66

,48

5

68

,90

7

66

,54

0

68

,42

4

0%

5%

10%

15%

-

100,000

200,000

300,000

2013F

FIDF Decree PassedInterest Payment Reduced ~70,000 THB Mil. a Year

(Although Public Debt Unchanged, Fiscal Room Freed up by 5%)

% Share of Total Budget ExpendituresTHB Mil.

Interest Payment for FIDF Debt

Interest Payment for GOV’T Debt

Principle Repayment for GOV’T Debt

% Share of Allocated Principle & Interest to Budget Expenditures

9%

12%

FIDF Interest Payment

7%

5%

4%

8%

11%


26

-

100,000

200,000

300,000

400,000

Restructuring FIDF 340,122 THB Mil. * Saved Over 7000 MIL THB a Year( 340,122THB Mil. = 30% of 1,142,101 THB Mil. Total FIDF Debt Outstanding)

LB11NA

89,099

SB129A

206,023

LB133A 40,000

R-bill 3M 19,000

R-bill 6M 52,350

FRB 4 yrs 14,450

LB 5 yrs 46,000

LB 7 yrs 20,000

P/N 6 yrs 39,000

Bond Market Development Bureau, Public Debt management Office

~3.01%

~3.09%

~3.08%

~3.625%

SB128A 5,000

4.5%

5.4%

R-bill 3M 23,245

R-bill 6M 48,105

FRB 4 yrs 14,450

LB 5 yrs 46,000

LB 7 yrs 20,000

P/N 6 yrs 39,000

P/N 6 yrs 50,099

R-bill 6M 7,223

LB 5 yrs 20,000

LB 7 yrs 15,000

FRB 4 yrs 10,000

P/N 6 yrs 18,000

LB 7 yrs 12,000

R-bill 6M 5,000

~3.63%

~3.45%

Saved ~2.3%(7 THB Bil. a Year)

~3.4%

PDDF Activated

PDDF : Public Debt Restructuring and Domestic Bond Market Development Fund

6.1%

5.375%

LB 10 yrs 12,000

~3.25%

Total Pre-Funding : 190,800MB

Positive Carry = 57 MB

Total Pre-Funding : 190,800MB Result : 64 MB (3bps)

(4,200 – 4,136)

~5.7%(avg. cost)

*Excluded 18,000 Pre-Mature FIDF Debt Restructuring in 2012

LATEST VERSRION

-

100,000

200,000

300,000

400,000

34

0,1

22

64,970

129,124

75,171 95,014

55,000

100,000

54,800 37,900

109,000

32,000 49,000

23,245

60,328

66,000

47,000

12,000

107,099

24,450

Strategies in managing FIDF’s 340,122MB* in 2012

*Excluded 18,000MB of Pre-Mature FIDF Debt Restructuring in 2012

Relatively Shorter.. to Allow FlexibilityPartially Float.. to Reflect Market RatePartially Callable.. to Prepare for Early-Repayment

LB 3-10yr

FRB / R-bill

P/N

Bond Market Development Bureau, Public Debt management Office

THB

Mil

Beginning FY2012 Ending FY2012 ResultATM 4yrs 8mths 5yrs 3mths Lengthen by 7mthsCost 5.1% 4.5% Lowered by 67 bpsFixed : Float 82 : 18 79 : 21 Float Increased 3%Callable Proportion 10% 19% Callable Rose 9%NO Refinancing Risk : Yearly Maturing Debt < 250,000 THB Mil

Post 2012 Checklist LATEST

VERSRION

1) To develop deep and liquid local currency and regional bond markets 2) To enable investment-grade ASEAN+3 issuers to access local currency bond markets 3) to promote the issuance of debt securities with longer term maturities to match the

gestation of investment projects

1) A reduction of cost of financing of issuers 2) An efficient fund raising and a conformity with financial requirement of the business 3) A reduction of currency & Maturity Mismatch

Objectives

Benefits

Functions 1) Guaranteeing bonds that are denominated in local currencies and issued by

ASEAN+3 entities rated investment-grade 2) Guaranteeing bonds that are not denominated in local currencies and issued by

ASEAN+3 entities rated investment-grade, provided the entities concerned are naturally hedged in such currency

3) Making investments for the development of the bond markets (no such investments shall be made until after the Meeting of Contributors has determined that CGIF is in a position to commence such operations); and

4) Undertaking such other activities and providing such other services consistent with CGIF objectives

Population($6,865 mln)

Trade($18.9 trln)

Source: IMF and World Trade Organization

GDP($69.6 trln)

31%

($2,133 mln)

24%

($16.4 trln) 46%

($8.6 trln)

CGIF is guaranteed by ASEAN + 3 Rising Giant

CGIF Activated

27

BAHT BONDCGIF

2012 2013 2014 2015 2016 2017 2018 2019

4 BB

Inv’t Grade

Targetedindustry

Naturalhedging

?

GOVERNMENT Bond

BOT Bond

SOE Bond

Corp Bond

Baht Bond

CGIF1%

19%

7%

35%

38%

Bond Market Development Bureau, Public Debt Management Office

Linking CGIF & BAHT BOND to the Development of Bond Market

2005 2006 2007 2008 2009 2010 2011 2012

94 BBIB

RD

Hana(18,000 m)

KDB

KEXIM(20,700 m)

IBK(12,300 m)

Citi(11,553 m)

ADB(10,500 m)

ING(10,000 m)

AFD

CABEI

Woori

SEK

Total Outstanding THB 8.2 TRN.(71% of GDP )

as of 31 Aug 2012

ASEANThai CorporateGlobal

issuersDomestic Bond Mkt

28

0

100

200

300

400

500

29/8/

2008

30/9/

2008

31/10

/2008

28/11

/2008

30/12

/2008

30/1/

2009

27/2/

2009

31/3/

2009

30/4/

2009

29/5/

2009

30/6/

2009

31/7/

2009

31/8/

2009

30/9/

2009

31/10

/2009

30/11

/2009

30/12

/2009

29/1/

2010

26/2/

2010

31/3/

2010

30/4/

2010

31/5/

2010

30/6/

2010

30/7/

2010

31/8/

2010

30/9/

2010

29/10

/2010

30/11

/2010

30/12

/2010

31/1/

2011

28/2/

2011

31/3/

2011

29/4/

2011

31/5/

2011

30/6/

2011

29/7/

2011

31/8/

2011

30/9/

2011

31/10

/2011

30/11

/2011

30/12

/2011

31/1/

2012

29/2/

2012

30/3/

2012

30/4/

2012

31/5/

2012

By Rating

Who is Eligible for CGIF Guaranteed?

ALL current issuers of corporate bondsPublic Debt Management Office, Ministry of Finance

Cost Saving

Bp

s (a

bo

ve 5

-yr

Go

vern

men

t Bo

nd

)

BBB

A

44%

AAA

BBB10%

27%

AAA

19%

Unrated

Corporate Bonds (less commercial paper) = THB1.3 trillion (16% of Bond Market at THB 8.3 trillion As of 31 Aug 2012) Source: ThaiBMA

350bps

125bps

170bps

50bps

GOVT

2008 2009 2010 2011 Aug 2012

By Business Sector

Energy

24%

Bank

21%

Food

9%

Prop

10%

Conmat8%

Fin

6%

Other

5%

Petro5%

Trans

5%

ICT

3%

Agri

2%

Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong presented the Ministry of Finance

Outright Primary Dealer (MOF OUTRIGHT PD) certificates to 13 financial institutions on

August 28, 2012, at Vayupaksa 4, Ministry of Finance. 29

Founding 13 MOF-outright PD

Yearly Evaluation (fiscal year) with half-year review Regular one-on-one or one-on-group meeting

Exclusivity in 5-yr tenor

BOT outright counterparty MOF Preferred Counterparty


Duties, Privileges and Monitoring To ensure efficient market making activities

Duties

Privileges

Monitoring

Partnership with MOF Benefit from Incentive program of

Thailand stock Exchange

Maintain at least 5% share of

total issue size of selected tenor

Participate in every auction Submit bid at least 10% for

exclusivity tenor

1. Primary Market 2. Secondary Market 3. Bond Market Development

Maintain at least 5% share of market trading value

Submit daily end-of-day price to ThaiBMA

Being MOF, Stock exchange of Thailand, BOT and ThaiBMAPartner in developing bond market

Selected LB: 3 yr (LB176A) 5 yr (LB196A) 7 yr (LB21DA) 10 yr (LB236A) and ILB

30


Upgrading Primary Dealer System MOF Outright PD

1. Bangkok Bank PCL.

2. BNP Paribas, Bangkok Branch

3. Citibank N.A., Bangkok Branch

4. Deutsche Bank AG., Bangkok Branch

5. The Hongkong and Shanghai Banking Corporation Limited

6. JPMorgan Chase Bank, Bangkok Branch

7. Kasikornbank PCL.

8. KGI Securities (Thailand) PCL.

9. Krung Thai Bank PCL.

10. The Royal Bank of Scotland N.V., Bangkok Branch

11. Siam Commercial Bank PCL.

12. Standard Chartered Bank (Thai) PCL.

13. TMB Bank PCL.

31

Electronic Retail

Savings Bond

Accessible Savings for All and Promoting Thailand Towards

Saving Society Bangkok and Central

S

N 8%

NE 7%

7%

78%

Well-Diversified Investor Base

Bond Market Deepening

9%

CB 10%

NR 10%

Insurance and

Other Corporation

32%

Depository Corporation

39%

Retail Bond Distribution Classified by Region

Improve Infrastructure to Develop Country

Tram System

Transportation System

Infrastructure System

Energy System

Telecommunication System

Government Debt Securities Classified by Types of Investors

Electronic Retail Savings Bond

Enhance Liquidity in Secondary Market

Promote Scripless Trading system

Alternative Instrument for Micro-Savers

Household and

Non-profit

2542 2543 2544 2545 2547 2548 2549 2550 2551

5 Innovations towards Sustainable Development

Dynamic

Drive

Dimension

Financial

Distribution

Service

Development

Step-upInterest Rate

Limit AmountMinimum Amount

10,000 Baht

Limit

Accessible Savings for All

Future

2011

200

2542 2543 2544 2545 2547 2548 2549 2550 2551 1 2 3 4 5

2010

%

% %

%

%

1 2 3 4 5 6

Add

Designated Financial

Institutions

1 2 3

• DYNAMIC FEATURES • BROADENED DISTRIBUTION• SYNERGY DRIVE • SOCIAL DIMENSION• FINANCIAL SERVICE DEVELOPMENT

5Ds

Features

Broadened

Synergy

Social

2007

Past (1997 – 07) Present (2008 – 2012)

12 Banks

(2010)

2nd Period: People

1


FixedInterest Rate

% % %

% %

%

%

%

%

Minimum Amount

10,000 Baht

Add

Distribution channel

1st Period : Senior Citizen

2 Periods of Distribution

Only One Designated Financial Institutions

Senior Citizen

1st Priority

Across the Country

Via The Branch of Designated Financial Institutions

yr yr yr

To Allow Retail Investor Access to Quality Source of Savings

Retail Bond @ ATM for Micro Savers

To Promote Regular Saving Among Low Income Investor

To Promote Scripless System

1

Phase 1 Phase 2

1,000 Baht

All year round selling

ATMThe Branch of Designated Financial Institutions

Retail Bond @ ATM for Micro Savers (1st launch Sept 2011)

( 2554)

Savings Bond


Thailand… Towards Saving Society

3

2

Minimum Amount 10,000 Baht

Selling Period 5 Days

Distribution ChannelThe Branch of Designated Financial Institutions

Distribute Via ATM

Distribute Via Electronic Platform

Liquidity + Bond Mart + Secondary Market

32

Secondary Market + Bond Mart + trading Platform

เ ม ช ห ห ณะ เ ฒ ะเ ศ

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

For Further Information : Chularat Suteethorn +662 265 8050 ext. 5100 [email protected]

Director-General, Public Debt Management Office

Pimpen Ladpli +66 2271 7999 ext. 5802 [email protected] Director of Government Bond Market Development Division

Acting Director Bond Market Development Bureau

Nattakarn Boonsri +66 2271 7999 ext. 5803 [email protected] Director of Fund Management and Bond Market Infrastructure Development Division

Chatmanee Sinsiri +66 2271 7999 ext. 5804 [email protected]

Director of International Bond Market Policy Division

Wilawan Prachasin +66 2271 7999 ext. 5816 [email protected]

Economist

Pothirat Kijsriopak +66 2271 7999 ext. 5812 [email protected] Economist

Ittipong Kanluan +66 2271 7999 ext. 5806 [email protected] Economist

kingdom of thailand bond market development

Documents

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