Fitch Rates Bank of Ayudhya#s Senior Unsecured Bonds #AAA(tha)#

Stocks and Financial Services Press Releases Thursday September 5, 2019 14:38
Bangkok--5 Sep--Fitch Ratings
Fitch Ratings (Thailand) has assigned Bank of Ayudhya Public Company Limited's (BAY, AAA(tha)/Stable) upcoming issue of senior unsecured bonds a National Long-Term Rating of 'AAA(tha)'.
The proposed bonds will have tenors of up to three years. Proceeds will be used for refinancing and general corporate purposes.
KEY RATING DRIVERS
The bonds are rated at the same level as BAY's National Long-Term Rating as they represent the bank's unsubordinated and unsecured obligations.

BAY's National Long-Term Rating reflects Fitch's view that it is extremely likely to receive support from its parent, MUFG Bank, Ltd. (A/Stable/a). MUFG owns 76.9% of BAY, with significant linkages such as in management, marketing and funding. Furthermore, BAY plays a key role in implementing the group's strategies for south-east Asia.

RATING SENSITIVITIES
The rating on the proposed bonds is sensitive to any changes in BAY's National Long-Term Rating, which is at the top end of the scale and therefore has no upside.

A downgrade of MUFG Bank's Long-Term Issuer Default Rating could lead to negative rating action on BAY, including action on the National Long-Term Rating. BAY's ratings could also face negative rating action if MUFG Bank shows a reduced propensity to support BAY. However, Fitch believes this is unlikely to occur in the medium term.

For full details on BAY's key rating drivers and sensitivities, see the previous rating action commentary, "Fitch Upgrades BAY's Short-Term IDR to 'F1'; Affirms Long-Term IDR at 'A-'", published 12 April 2019.
DATE OF RELEVANT COMMITTEE
11 April 2019
Additional information is available on www.fitchratings.com

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