KINGDOM OF THAILAND BOND MARKET FINANCING THAILAND’S FUTURE & CONNECTING ASEAN
Public Debt Management Office, Ministry of Finance, Kingdom of Thailand Progress Update
Basic & Essentials
» Committing to FY2016 Fund Raising Plan » GOVT Bond Auction Results » T-Bill Plan Q2/FY2016 » GOVT Bond Auction Schedule Q2/FY2016 » SOE Bond Auction Schedule Q2/FY2016 » PDMO Bond Calendar FY2016 » New Allotment Framework for NCB
» Bond Market Development Strategy » Public Debt Outstanding and Its Composition » Total Domestic Public Debt » Bond Market Capitalization and Its Composition » Supporting Inclusive Growth Through ASEAN Bond Market Integration » Non-Resident Holding in Domestic Bond
Quick Facts
Public Debt Outstanding (as of Oct 2015)
5,867,373 THB Mil. (43.80% of GDP)
16
Well-Developed Bond Market Improved GOVT Direct Debt Profile Dramatically (as of Oct 2015) » Average-Time-to-Maturity (ATM) 11yrs 3mths » Average Cost 3.85% » Well-Balanced Fixed : Floating Ratio 88 : 12 » Well-Distributed Maturity Profile 40:20:40 (TTM<5 : 6-10 : >10yrs)
17
Bond Market Capitalization (as of Dec 2015)
10,086,082 THB Mil. (75% of GDP)
18
Liquidity & Secondary Market Trading
92% of Trading Volume (Outstanding > 100,000 THB Mil.)
19
Baht Bond Outstanding and its Market Share (as of Dec 2015)
88,474 THB Mil. (1% of Bond Outstanding)
21
Non-Resident Holding in Domestic Bond (as of Dec 2015) » Annual Capital Flow (YTD) GOVT Bond :
-110,461 THB Mil.
BOT Bond :
» NR Holding in THB Bond GOVT Bond : BOT Bond : Others :
24
-70,952 THB Mil. -39,509 THB Mil.
572,804 THB Mil. (5.7% of Thai Bond Market Cap.) 554,532 THB Mil. (14.2% of GOVT Bond Outstanding) 17,470 THB Mil. (0.6% of BOT Bond Outstanding) 802 THB Mil.
Progress Update Total Fund Raising Plan FY2016 T-Bills Plan Q2/FY2016
GOVT Bond Auction Results GOVT Bond Auction Schedule Q2/FY2016
SOE Bond Auction Schedule Q2/FY2016 PDMO Bond Calendar FY2016 New Allotment Framework for NCB
1
2
2016 - 2022
Government Funding Needs
86MB
2,XXXMB
New Borrowing
4,XXXMB 59,XXXMB
350 - 450 THB Bil. Per year
Deficit Bill
700 - 950 THB Bil. per Year
Insurance Decree
1,XXXMB 61,XXXMB 63,XXXMB
Substitution for foreign currency bond On-Lending
390,000
58,940
(2016-2022)
200,666
344,084
300,000
250,000
250,000
378,000
363,700
346,700
187,771
150,539
403,367
217,000
304,100
Repayment of SOE Debt (consists of 93% of Restructuring and 7% of New Debt)
GOVT
Rollover 350 - 500 THB Bil. Per year
52,000
-0-
149,209
FY 2016
113,014
340,122
191,095
129,124
FY2011
FY2012
FY2013
FY2014
307,945
187,898
59,374 FY2015F
112,708
98,400
104,236
264,863
106,958
101,800
37,900
109,000
-0-
FY2017F
FY2018F
FY2019F
FY2020F
FY2021F
FY2022F
FY2016
937,XXX MB * Include Infrastructure Investment
-Tentative1,xxx
Substitution for Foreign Currency On-lending
61,xxx 63,xxx
Savings Bond Promissory Notes and Others
390,xxx
Deficit
Bond Supply (Uncommitted) Bond Switching (LB176A) Inflation-Linked Bond
Debt Refinance (Bond Switching)
Roll Over 422,XXX MB
62,442
FY2016F
Total GOVT Fund Raising Plan
Insurance Decree
515,XXX MB
231,000
FIDF
(2016-2022)
New Borrowing
80,XXXMB
Repayment of SOE Debt (BAAC)
Rollover Govt Debt
50,xxx 40,xxx
50,xxx 80,xxx 188,xxx
Loan Bond 5-10-15-20-30-50 yrs
460,xxx
Rollover FIDF Debt
104,xxx By bills
By Instruments
Benchmark Bond (Committed)
500,XXX MB
FY2016 GOVT Fund Raising Plan = 937,xxx MB
Demand – Tools – Liquidity 148%
Liquidity
128%
1,390,000MB
1,500,000
Tools
113%
Demand
100%
937,xxx
1,200,000MB Fx Bond
1,055,200MB MB
Co-op & Non-profit
50,000
TL
51,600
1,000,000
200,000
Existing Liquidity
PN 70,000 Mutual Fund
ILB 80,000
(from maturing debt)
250,400
675,000
LBA 100,000 SB 100,000
500,000
0
Insurance & GPF & SSO
Issuing New Debt
LB
298,200
515,000
New Liquidity
Rollover of Maturing Debt 422,000
Household Deposit 455,000
600,000
715,000
Rollover + Deficit + Repayment + Bond Switching
New Demand for Fixed-income investment
Full Capacity of GOVT Funding Instruments
Liquidity for GOVT & SOE Borrowing
ThaiBMA
PDMO
Estimated by :
(from econ. growth)
BOT
(June 2015)
(July 2015)
Bond Supply has remained unchanged for two years THB mil.
13% increase in FY2016
Amount of Benchmark Bond to Actual Fund Raising (FY2009 – FY2016)
1,000,000
750,000
-11% 500,000
43%
1%
13%
-0.5%
2% 10% 49% 250,000
0
3
ALL FY2016
Benchmark Bond is approximately 500 Bil.
53% of FY2016 Funding Needs 937 Bil.
THB Mil.
500,000
Benchmark Bonds
Auction Size
5-yrs (LB206A) 10-yrs (LB25DA) 15-yrs (LB296A) 20-yrs (LB366A) NEW 30-yrs (LB446A) 50-yrs (LB666A) NEW
20,000 – 25,000 12,000 – 14,000 10,000 – 12,000 10,000 – 12,000 8,000 – 10,000 8,000 – 10,000
400,000
ILB
Total
(85%)
40,000Mil. (15%)
5,000 – 10,000
500,xxx MB
Total Benchmark Bonds
300,000
460,000Mil.
-TentativeTop-up
15 10
Top-up
Top-up
5
30
15
Top-up
Top-up
5
100,000
Top-up
200,000
20
5
TTM
10
15
-
New-Issue -
40
-
LB666A LB666A
LB616A
LBA566A
LB446A LB446A LB453A ILB453A
30
-
-
50
Low Cost of Funding High Volume of Short-term Demand
FY2015
THB Mil.
New-Issue
New-Issue
20
T-Bill Auction Result
FY2015-16
30
LBA37DA LB383A LB396A LB406A LB416A
ILB353A ILB356A LB366A LB363A
LB316A LB326A
LB27DA ILB283A ILB283A LB283A LB296A LB296A
LB15DA LBF165A LB167A LB16NA LB171A LB175A LB176A LB17OA LB183A LB183B LB191A LB193A LB196A LB198A LB19DA LB206A LB206A LB213A LB214A ILB217A ILB217A LB21DA LB22NA LB233A LB236A LB244A LB24DA LB25DA LB25DA LB267A
0
New-Issue
50 20
FY2016
Basis Points
75,000
Q3
Q4
9.5
Q2
Q1
60,000
8.0 6.5
45,000 5.0 30,000 3.5
-
15,000
2.0 0.5
T-1= 00
0.4 -0.4
-0.6 -0.8
-1.2
-15,000 -1.9
-1.6
-2.7
-2.6-2.6
-3.3 -3.4 -3.7-3.8
-3.9
-1.9
-2.3 -2.2
-2.2
-30,000
MB
-2.1
-2.6 -3.0
-2.9 -3.4
-2.4
0.1
0.00.1
-0.2 -0.6 -1.0
-1.0 -2.5
-2.1 -2.6
-3.1
-4.0
-3.6
-4.2 -4.2
-4.4
-0.9
-4.4
-5.5 -45,000
-5.5
-7.0 -60,000
-75,000
T-bill 1 month T-bill 6 months R-bill 3 months Apr-15
4
May-15 Jun-15
T-bill (Allocated Amount) Participated Amount (Excess Demand) Not Fully Allocated or Subscribed Spread [AAY-Yield(T-1)]
Jul-15
Aug-15
Sep-15
Oct-15
-8.5 -8.4
-10.0 Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
FY 2015-2016 GOVT Bond Auction Results Classified by Auction Schedule Short-term Benchmark Bond (<10 yrs) Long-term Benchmark Bond (>10 yrs) Inflation-linked Bond Amortized Bond
Participated Amount (Excess Demand) Not Fully Allocated or Subscribed Spread [AAY-Yield (T-1)]
Basis Points
THB Mil. 100,000
25
FY2015
80,000
FY2016
75,696
,
20
64,588 60,475
58,919
60,000
15
44,090
40,000
41,142 34,055
20,000
3.3
10
36,610
28,293
5.9
8.9
22,145
3.9
17,026
22 6,525 3,028 4,030 2,100
T-1= 0 -
8.2
10.5 30,164 6.0
18,438 17,845 17,766 15,275 16,085 1,802 13,496 15,480 15,250 2.613,950 12,010 14,194 10,060 3,840 10,725 8,563 7,600 562 5,212 1.3
1.5
-1.8
-0.2
-0.4
-1.1
-0.6
-0.9
-3.6
13,200 14,365 10,120 11,800
16,555 15,650
0.4
-0.1 0.2
-0.5
-0.8
-2.2 -1.9-1.9
-2.8
-6.7
-5.2
-5.3
-6.1
-5
-4.0
-4.1
-5.6
-6.4
-7.9
-40,000
5 0
-0.4
-2.7
-3.4
24,420 21,525 22,472 15,895 16,761 15,407
4,255 0.5
-1.4
-4.1 -5.2
5.4
-1.0 -2.4
-20,000
24,909 19,580
1.7
0.2
28,602
-9.8
-10
-9.4
-9.9 -11.3
-15
-60,000 -15.5
21 Oct 2014 21 Oct 2014 29 Oct 2014 29 Oct 2014 12 Nov 2014 19 Nov 2014 26 Nov 2014 3 Dec 2014 3 Dec 2014 9 Dec 2014 17 Dec 2014 7 Jan 2015 14 Jan 2015 21 Jan 2015 21 Jan 2015 4 Feb 2015 11 Feb 2015 11 Feb 2015 18 Feb 2015 25 Feb 2015 3 Mar 2015 18 Mar 2015 25 Mar 2015 8 Apr 2015 22 Apr 2015 22 Apr 2015 29 Apr 2015 6 May 2015 20 May 2015 20 May 2015 27 May 2015 3 Jun 2015 24 Jun 2015 8 Jul 2015 8 Jul 2015 15 Jul 2015 28 Jul 2015 11 Aug 2015 19 Aug 2015 26 Aug 2015 2 Sep 2015 2 Sep 2015 9 Sep 2015 23 Sep 2015 21 Oct 2015 21 Oct 2015 28 Oct 2015 11 Nov 2015 18 Nov 2015 25 Nov 2015 2 Dec 2015 8 Dec 2015 23 Dec 2015
-80,000
-20
FY2015 – Q1FY2016 GOVT Bond Auction Results Classified by Tenor Benchmark Bond 5 – 10yr
Million Baht
5yr
100,000
Benchmark Bond 15 – 50yr
15yr
10yr
(Exclusivity)
Bps
30yr
20yr
50yr
25
85,705
75,696
80,000
20 , 60,475 58,919
60,000
15
44,090 41,142
40,000
36,610
10
34,055 30,164
19,580 24,420 15,250 11,800
1,802 5.9
2.7
T-1= 0
1.7
-
-0.4
-0.2 -0.6 -1.8
-1.0 -2.4
28,602
-0.5 -1.9
-1.4
13,950
200
0.5
16,55521,525 15,407 13,49610,120
1.3 3,840
17,026 6.0
10,725
0.4
0.2
-9.8
-60,000
-80,000
Short-term Benchmark Bond (<10 yrs) Long-term Benchmark Bond (>10 yrs) Greenshoe Amount Not Fully Allocated or Subscribed Average Accepted Yield
22,145
15,275
18,438
5 14,365
3,0285,212
500
3.9
-0.8
0
1.5 -0.4
0.2
-0.1
-0.9 -1.9
-2.2
-3.4
-3.6 -5.6
-40,000
15,895
8,563
-2.8
-20,000
16,761
8.9
24,909
16,085
4,405 3,707
3,9763,8034,0003,779
20,000
28,293
-6.1
-5
-5.3 -5.2 -6.4
-10
-9.4
-9.9 -11.3
-15
-20
5
6 17-Jun-2036
Re-open Re-open Re-open
22-Jun-2029
LB296A = LB366A = LB446A = LB666A =
Re-open Greenshoe Option)
12-Dec-2025
Re-open
MOF Outright PD
26-Jun-2020
3.40%
LB25DA =
LB206A =
Maturity Date
4.875%
2.55%
Coupon
3.85%
21,000
20,000
11,000
LB366A 20-yrs New
20,000
MPC
10,000
MPC
10,000
LB296A 15-yrs
Total
27,000
13,000
14,000
LB25DA 10-yrs
10,000
20,000
LB206A 5-yrs Exclusivity
30 March 2016
23 March 2016
16 March 2016
9 March 2016
2 March 2016
24 February 2016
17 February 2016
10 February 2016
3 February 2016
27 January 2016
20 January 2016
13 January 2016
6 January 2016
Auction Date
-
Re-open
29-Jun-2044
4.675%
10,000
10,000
LB446A 30-yrs
17-Jun-2066
4.00%
20,000
10,000
10,000
LB666A 50-yrs New
118,000
10,000
10,000
10,000
13,000
-
10,000
20,000
-
10,000
11,000
10,000
14,000
Total
Auction Schedule for Q2/FY2016 Q2/FY2016 GOVTGovernment BondBondAuction Schedule (Jan â&#x20AC;&#x201C; Mar 16)
7
21
28
4
Wk 3
Wk 4
Wk 5
มีนาคม
(Mon, 22)
Makha bhucha
(Mon.8)
17
24
31
Wk 11
Wk 12
Wk 13
Total
10
3
25
18
Wk 10
Wk 9
Wk 8
Wk 7
11
14
7
Wk 2
Wk 1
Chinese New Year Wk 6
February
January
3,000
2
2,000
3,000
-
7
Guaranteed by GOVT Gauranteed and Serviced by GOVT Partially Guaranteed by GOVT
MG GG (P)
Sources of Fund
23,300
MPC
GG23,300
6
Term Loan
3,000
MG
5
SOE Bond
-
4
Not Guaranteed by GOVT
-
3
NG
20,000
GG10,000
NG2,000 GG10,000
1
Borrowing Instruments
3,000
NG
Thu. Less than 1
Tenor of Term Loan and Bond (year)
760
MPC
NG590 MG170
8
1,000
10
-
1,000
NG
NOTE :
-
9
4,000
-
More than 15
EXAT _Auction Thu BAAC _Auction Thu NHA _Syndication Tue BAAC _Syndication Thu PWA _Auction Thu EGAT _Auction Thu PEA _Syndication Tue
4,000
NG
11-15
Q2/FY2016 SOE Bond Auction Schedule (Jan – Mar 16) -
57,060
-
-
-
4,000
10,000
-
3,000
-
23,300
1,000
12,000
3,760
Total
Quarter 2
Quarter 1
8
Mar 2016
Feb 2016
Jan 2016
Dec 2015
Nov 2015
Oct 2015
Makha Bucha Day
22
21
29
15
14
28
8
7
Quarterly PD Market Dialogue
1
23
22
29
16
15
9
2
1
8
26
25
12
11
19
5
4
18
29
28
15
22
Baht Bond 1/FY2016
8
21
14
H.M. The King's Birthday observed
1
30
7
24
23
Last day of submission for Baht Bond Application (1/2016)
17
10
16
9
3
First day of submission for Baht Bond Application (1/2016)
20
13
2
Auction T-bill
Retail Only
Auction T-bill
6
27
Auction T-bill
Auction T-bill
19 Issue Regular Saving Bond 1/2016(3y) : 50,000 MB (19 Oct 15 - 29 Feb 16) 26
12
5
Mon
First day of submission for Baht Bond Application (2/2016)
MOF Outright PD Committee : Quarterly PD's Evalution
Quarterly PD Market Dialogue
Action LB446A (30Y) : 10,000MB
MOF Outright PD Committee
Tue
30
23
16
9
2
24
17
10
3
27
20
13
6
30
23
16
9
2
25
18
11
4
28
Action LB366A (20Y) : 10,000MB NEW 20Y
MPC
Action LB296A (15Y) : 10,000MB
Action LB666A (50Y) : 10,000MB NEW 50Y
Action LB25DA (10Y) : 13,000MB
Action LB446A (30Y) : 10,000MB
Action LB206A (5Y) : 20,000MB
MPC
Action LB296A (15Y) : 10,000MB
Action LB366A (20Y) : 11,000MB NEW 20Y
Action LB666A (50Y) : 10,000MB NEW 50Y
Action LB25DA (10Y) : 14,000MB
Action LB206A (5Y) : 27,000MB
MPC
Action LB296A (15Y) : 13,000MB
Action LB666A (50Y) : 9,000MB NEW 50Y
Action LB366A (20Y) : 11,000MB NEW 20Y
Action LB25DA (10Y) : 13,000MB
MPC
Action LB296A (15Y) : 13,000MB
LB446A (30Y) : 9,000MB
21 Action LB206A (5Y) : 24,000MB
14
7
Wed
31
24
17
10
3
25
18
11
4
28
21
14
7
31
24
17
10
3
26
19
12
5
29
22
15
8
1
PDMO Bond Calendar FY 2016
Last day of submission for Baht Bond Application (2/2016)
New Year's Eve
Constitution Day
Thu
1
25
18
11
4
26
19
12
5
29
22
15
8
1
25
18
11
4
27
20
13
6
30
23
16
9
2
Quarterly Macroeconomics Report (FPO)
New Year's Day
Quarterly Macroeconomics Report (FPO)
Chulalongkorn Day
Fri
2
26
19
12
5
27
20
13
6
30
23
16
9
2
26
19
12
5
28
21
14
7
31
24
17
10
3
27
20
13
6
28
21
14
7
31
24
17
10
3
27
20
13
6
29
22
15
8
1
25
18
11
4
Sat Sun 3
Quarter 3
Quarter 4
9
Sep 2016
Aug 2016
Jul 2016
Jun 2016
May 2016
Apr 2016
21
28
5
20
27
4
2
1
20
27
26
6
5
19
30
29
13
23
22
12
16
15
9
26
25
8
19
18
12
14
13
11
7
6
First day of submission for Baht Bond Application (3/2016)
31
30
24
23
10
3
17
MOF Outright PD Committee : Quarterly PD's Evalution
Labor Day observed
16
9
2
26
25
12
5
19
Long-term Investor Meeting
Baht Bond 2/FY2016
18
11
4
Asalha Bucha
28
21
14
7
31
24
17
10
3
27
20
13
6
29
22
15
8
1
25
18
11
4
27
20
13
6
Buddhist Lent Day
Quarterly PD Market Dialogue
Songkran Festival Day
Chakri Day
MOF Outright PD Committee : Final Review
Baht Bond 3/FY2016
Coronation Day
Last Day of submission for MOF Outright PD's Application
Songkran Festival Day
First Day of submission for MOF Outright PD's Application
29
22
+ MOF Awards
15 Annual PDMO-Market Dialogue
8
1
25
18
11
4
28
21
14
7
30
23
16
9
2
26
19
12
5
28
21
14
7
H.M. The Queen's Birthday
24
17
10
3
27
20
13
6
30
23
16
9
2
25
18
11
4
28
21
14
7
30
23
16
9
25
18
11
4
28
21
14
7
31
24
17
10
3
26
19
12
5
29
22
15
8
1
24
17
10
Remark : Royal Ploughing Ceremony Day- waiting for an annoucement This schedule is subject to change without prior notice.
30
23
16
9
2
26
19
12
5
Quarterly Macroeconomics Report (FPO)
Mid-year Bank Holiday
Visakha Bucha
Last day submission for Baht Bond Application
29
22
15
8
1
24
17
10
3
27
20
13
Quarterly Macroeconomics Report (FPO)
Songkran Festival Day
12 - 15 May 2016: Money Expo
6
29
22
15
8
Peers Comparison
BOND market capitalization Source : Asian Bond online (ADB) 250%
BOND mkt. cap : GDP
222%
Government BOND Yield Curve
Hundreds
200%
10%
Public Sector (GOVT + CB + SOE) Private Sector 150%
129% 95%
100%
75%
8%
Vietnam
53%
50%
Indonesia
9%
7%
20% 6%
0%
Philippines Malaysia
5%
Thailand Share of PUBLIC sectorâ&#x20AC;&#x2122;s Bond to Total BOND mkt. cap. % : BOND mkt. cap.
4%
USD Billions 300
99%
100% 86%
Japan
60%
57%
109
1%
150
USD Billions
107 37
0%
SOE 22
86
BOT 78
Philippines
Thailand
USD Billions
Korea
2%
GOVT
0%
2.51% 2.16%
50%
147
161
Singapore
Malaysia
-1%
Te n o r
0
Vietnam
Indonesia
China
USA Singapore
3%
84% 75%
3.85%
3.59%
As of December 30th ,2015
Government BOND Yield Matrix
ASEAN & Peers
As of December 30th , 2015
6m
1 yr
2 yr
3 yr
4 yr
5 yr
6 yr
7 yr
8 yr
9 yr
10 yr
20 yr
30 yr
40 yr
Japan
-0.10
- 0.04
- 0.03
- 0.01
0.01
0.03
0.04
0.06
0.12
0.19
0.27
1.00
1.28
1.41
Korea
1.59
1.64
1.66
1.68
1.76
1.84
1.89
1.94
1.99
2.04
2.10
2.18
USA
0.47
0.64
1.08
1.36
1.58
1.80
1.97
2.14
2.20
2.25
2.31
2.69
3.04
-
1.01
1.07
1.34
1.61
1.88
2.02
2.16
2.29
2.43
2.57
2.90
2.97
Thailand
1.50
1.50
1.57
1.73
1.87
2.16
2.26
2.37
2.46
2.51
2.51
3.16
3.59
3.72
3.85
China
2.25
2.30
2.42
2.54
2.62
2.70
2.80
2.84
2.84
2.83
2.83
3.48
3.62
3.68
3.74
Malaysia
2.76
2.61
2.91
3.24
3.36
3.48
3.78
4.09
4.13
4.17
4.21
4.68
4.90
Philippines
2.93
3.17
3.02
3.68
3.90
4.30
4.45
4.60
4.44
4.27
4.10
5.50
Vietnam
-
4.97
5.31
5.82
6.22
6.61
6.78
6.94
7.03
7.11
7.20
Indonesia
7.61
8.19
8.56
8.74
8.82
8.85
8.86
8.87
8.88
8.90
8.92
Singapore
9.14
9.21
Brunei Cambodia Laos Myanmar
10
below 1%
2.01% - 3%
over 4%
1.01% - 2%
3.01% - 4%
no data
50 yr
New Allotment Framework for NCB NCB Bidding Amount Individually Bidding Amount
NCB Issue Amount / Auction
Minimum
Maximum
Before January 2013
20%
4 THB mil.
40 THB mil.
From January 2013 to present
20%
4 THB mil.
100 THB mil.
New Bidding Amount
20%
4 THB mil.
Not exceed 20% of auction amount
Begin January 2016
NCB Allotment Step 1 : Allocate bids for the first 100 million baht Step 2 : Allocate amount over 100 million baht by Pro-rata Begin : January 2016
11
12
Funding Infrastructure Investment Connecting ASEAN
Domestic Bond Market in Transition
Funding Infrastructure Investment Connecting ASEAN (2013 - 2016) 2016 Highlights
Market Deepening Oriented (2010 - 2012)
Sustainable Source of Fund
Water Decree (350,000 THB Mil.)
Full Funding Capacity : 1,200,000 THB Mil.
Thai Khem Khang (350,000 THB Mil.)
1,900,000 THB Mil. Long-Term Infrastructure Inv’t
Baht Bond (Foreign Issuers Bond)
Baht Bond (CLMV) Credit Guarantee Investment Facility (CGIF)
Regional Connectivity / AEC
Foreign Currency Bond
Debt Folio Enhancement
ATM Lengthened
Well-Distributed Investor Base
Cost Lowered
Well-Balanced Fixed-Floating Ratio
FIDF Decree Passed = 70,000 THB Mil. Fiscal Space
Well-Distributed Maturity Profile / Bond Switching Bond Switching (1st execution: 28 Nov 14)
Appointed 14 MOF-Outright PD
Market Infrastructure
Strengthening PD system
Activated Public Debt Management Fund
(Exclusivity, League Table, Greenshoes Option)
STRIPS Bond
Innovation / Product Development
Inaugural 10-yr Inflation-Linked Bond (10-yr)
Scripless Retail Savings Bond Saving Habit Super- Size Inaugural 25-yr Back-End Amortized Bond
Long-term Fixed Promissory Notes (25-35-45-yr)
Re-open ILB 7-yr or Launch ILB-30yr
Electronic Retail Savings Bond (3-5-yr)
STRIPS Transaction Annual PDMO Market Dialogue
Annual PDMO Market Dialogue
Market Consultation
Quarterly PDMO one-on-group MOF Outright PD Dialogue
Quarterly PDMO one-on-one PD Dialogue
50
30
Building Yield Curve / Enhancing Liquidity
15 10 7 5 3
Monthly PDMO one-on-one MOF Outright PD Dialogue
Liquidity-Oriented
300,000 MB
20
8 Tenors of Benchmark Bonds
150,000 MB Outstanding Amount
3 5 7
10
15
20
30
50
Equilibrium of Domestic Bond Market Issuers
• 75 percent of Thailand’s debt securities are issued by Government, Bank of Thailand and State-Owned Enterprises
Credit Rating
• 99 percent of Thailand’s debt securities are classified as Investment Grade
Investors
• Thailand’s government debt securities are held by a wide group of investor types
Domestic Bond Market (Classified by Issuers)
Domestic Bond Market (Classified by Credit Rating) 1% Non-rated
CGIF 0.03% Baht Bond 1%
12% Government
39%
SOEs
8%
BOT 5%
4%
Government
24% BOT
SOEs 8%
28% Total of 10.0 THB Trillion
Source : ThaiBMA (End of December 2015)
Household and Non-profit
BBB
A Corp Bond
Government Debt Securities (Classified by Types of Investors)
39% BOT
28% Total of 10.0 THB Trillion
Source : ThaiBMA (End of December 2015)
6%
NR 15%
Insurance and Other Corporation
41% Depository Corporation
33% Total of 3.9 THB Trillion
Source : BOT (End of November 2015)
15
Public Debt Outstanding (as of Oct 2015) = 5.87 THB Trillion (43.80% of GDP) Components of Public Debt
Units : THB Mil.
3,257,114 998,791 1,054,888 538,201 18,379
1. Government Debt (excluded FIDF) 2. Government Debt (for FIDF) 3. Non-Financial State Enterprise Debt 4. Special Financial Institutions Guaranteed Debt 5. Autonomous Agency Debt
Autonomous Agency Debt
0.31% Special Financial Institutions Guaranteed Debt
9.18
% 538,201 THB Mil.
5,867,373
Public Debt Outstanding
18,379 THB Mil.
Non-Financial State Enterprise Debt
17.98% 1,054,888 THB Mil.
GOVT Debt 55.51% 3,257,114 THB Mil.
GOVT Debt (for FIDF)
17.02% 998,791 THB Mil.
Source : Information Technology Centre, PDMO
Portion of Public Debt Serviced by The Government Public Debt Components “All”
Public Debt Components “serviced by the government ”
5.87 THB Trillion
3.71 THB Trillion
Autonomous Agency Debt
Special Financial Institutions Guaranteed Debt 9.18% 538,201 THB Mil.
Non-Financial State Enterprise Debt
17.98% 1,054,888 THB Mil.
0.31% 18,379 THB Mil.
Special Financial Institutions Guaranteed Debt
serviced by the government
Autonomous Agency Debt
serviced by the government 0.04%
7.80%
GOVT Debt 55.51%
GOVT Debt 53.31 % % 54.65
3,257,114 THB Mil.
GOVT Debt (for FIDF)
17.02% 998,791 THB Mil.
As of Oct 2015
16
Non-Financial State Enterprise Debt
100%
serviced by the government
0.80%
63%
Total Domestic Public Debt = 5.43* THB Trillion * Excluding Foreign Debt
Assumptions : 6 months BIBOR = 1.76%, 6 months Fixed Deposit Rate = 1.23%, Inflation = -0.77%
Non-financial SOEs
400,000
Autonomous-Agencies
98%
2%
TTM Fiscal Year
Next 5 yrs
FIDF 1
400,000
74,000 28,198
126,850
Next 5 yrs
Budget Deficit
22,000
T-Bill
106,702
3,000
196,379
Water
RW
10%
6-10 yrs
10 yrs +
= 11yrs 3mths Ext. Guaranteed Debt ATM Avg. Cost = 3.85% Fixed : Floating = 88: 12 THB Mil.
DPL
Callable
= 6%
Maturity Profile
3,900
40%
165,902
27,600
29,400
20,000 5,500
98,255
12,000 95,936
35,000
41,900
2,400
33,581
239,798
161,252
29,656 43,000
59,141
2,800
53,664
76,700 18,900
286,104 3,717
87,381
1,381
408,438
86,630
13,688 12,743
= 4yrs 4mths = 3.99% = 90: 10 = 7% Maturity Profile
13,000
24,700
11,836100,872
0
20,000
16,000
100,000
130,452
200,000
On-lending Loan
(Excluding foreign debt 83,422.72 THB mil. ) 3,633
176,164
5,091 17,784
TKK
GOVT Direct Debt (exclude FIDF) = 3,173,691
3,000 20,000
146,713
300,000
10 yrs +
31%
TTM Fiscal Year
400,000
0%
6-10 yrs
ATM Avg. Cost Fixed : Floating Callable
59%
71,000
40,000 69,000
101,800
25,000
128,000 77,059 25,000
131,981
23,232 64,771
0
FIDF 3
GOVT Debt (for FIDF) = 998,791 THB Mil.
300,000
100,000
Maturity Profile
2,600
8,000
10,400 2,987 8,000
400
0
200,000
= 1yrs 9mths = 2.94% = 54: 46 = 46%
8,000 25,000
150,782
181,869
10,842
11,780
Excluding Not serviced by GOVT 835,481 THB Mil. External SOE debt (Serviced by GOVT) 61,466 THB Mil. External SOE debt (Not-Serviced by GOVT) 207,824 THB Mil. 71,000
100,000
financial SOEs
SOE Debt (Serviced by GOVT) = 506,696 THB Mil.
300,000
200,000
As of Oct 2015
ATM Avg. Cost Fixed : Floating Callable
TTM Fiscal Year
Next 5 yrs
(1) (2) (3) (4)
Well-Developed Bond Market Improved
GOV’T Direct Debt Profile Dramatically
40%
20% 6-10 yrs
10 yrs +
ATM Lengthened Cost Lowered Well-Balanced Fixed-Float Ratio Well-Distributed Maturity Profile
Note : Government Direct Debt = 3,173,691 THB Mil. (exclude FIDF and external debt)
As of Dec 2007
ATM
Average-Time-to-Maturity LENGTHENED by 6yrs
Avg. Cost LOWERED by 65 bps.
As of Oct 2015
11yrs 3mths
ATM
5yrs 3mths
Avg. cost
4.5%
(While ATM Lengthened by 6yrs)
Avg. cost
3.85% Floating
Well-Balanced Fixed/Floating Ratio (Target : Fixed/Float ratio = 85 : 15)
10%
Fixed
Fixed
90%
88%
54%
Well-Distributed Maturity Profile (Maturing Debt in the next 5 yrs is less than 50% of Total Debt)
Floating
28%
Next55yrs yrs year 6-10 yrs next 6 -10
40%
40% 20%
18% 10 10 yrs yrs ++
12%
Next 5 yrs
6-10 yrs
10 yrs +
17
Bond Market Cap. = 10 THB Trillion
GOVT Bond = 3.9 THB Trillion
($108 Bil.)*
($277 Bil.)*
% Share of GDP
Domestic Bond Market Classified by Issuer
140% 128%
Baht Bond
120%
1%
99% 99%
100% 80%
75%
Corp Bond 24%
60% 40%
24%
20%
12%
Oct-15
0%
Bank Loan /GDP
Equity/GDP
Bond Market / GDP
Maturity Profile BOT vs GOVT Bond BOT ATM = 5mths GOVT ATM = 11yrs 3mths *End of Oct 2015
4% 78%
≤1
2% 22%
20%
1<yr≤3
3<yr≤5
36%
38%
5<yr≤10
10<yr≤50
end of Dec 2015
*Source: BOT Exchange rate as end of Nov 2015
Full Capacity* of All Government Funding Instruments
1,200,000 THB Mil. per Year
* Under favorable market liquidity + using All funding instruments
% 5.00 4.75 4.50
LB 3 yrs LB 5 yrs LB 7 yrs LB 10 yrs LB 15 yrs LB 20 yrs LB 30 yrs LB 50 yrs
150,000 THB Mil. 120,000 THB Mil. 80,000 THB Mil. 80,000 THB Mil. 60,000 THB Mil. 60,000 THB Mil. 50,000 THB Mil. 50,000 THB Mil.
($4.2 Bil.)** ($3.3 Bil.) ($2.2 Bil.) ($2.2 Bil.) ($1.6 Bil.) ($1.6 Bil.) ($1.4 Bil.) ($1.4 Bil.)
($33 Bil.)**
Thailand’s Loan Bonds (LBs) weighting in international indices
GBI-EM Global JP Morgan
iBoxx Asia ex Japan Markit
9.0%
Benchmark Bond
Asian Local Markets HSBC
9.8%
7.9%
Last Update : Dec 2015
4.25 4.00
50
3.75
30
3.50 3.25
20
3.00
15
2.75
10
2.50
7
2.25
5
2.00 1.75 1.50
The “Missing Composition” of Leader role in the Bond Market
3
Government Funding Instruments Infrastructure
liquidity Benchmark Bond
($17.9 Bil.) ($2.8 Bil.) ($2.8 Bil.) ($2.2 Bil.)
Benchmark Bond
~650,000THB Mil. (54%)
Savings Bond
~100,000THB Mil. (8%)
Amortized Bond
~100,000THB Mil (8%)
Inflation-Linked Bond
~80,000THB Mil. (7%)
($1.1 Bil.) ($0.8 Bil.) ($5.5 Bil.)
Promissory Note
~40,000THB Mil. (3%)
($33 Bil.)
Total
Floating Rate Bond Bank Loan
~30,000THB Mil. (3%) ~200,000THB Mil. (17%)
1,200,000 THB Mil. (100%)
1.25
TTM
18
Source: ThaiBMA Government Bond Yield Curve (end of Dec 2015)
**Source: BOT Exchange rate (As of Dec 30th ,2015)
Tier 1 > 100,000 THB Mil. in Size (92% of Trading Volume)
Total GOVT Bond = 40 Series (End of December 2015) THB Mil.
Tier 2 > 50,000 THB Mil. in Size
Tier 1: >100,000MB
350,000
(6% of Trading Volume)
FY2015 Market Share of Trading Volume in Secondary Market Tier 2 Tier 1
(12 Series)
300,000
Outstanding size (THB Mil.)
92%
6%
2%
250,000
0
200,000
50
100
Tier 2: 50,000 – 100,000MB
15
(13 Series)
10
150,000
30 5 100,000 100,000
50,000
20 50 LB267A LB24DA LB175A LB316A LB214A LB171A LB19DA LB244A LB22NA LB183A LB406A LB366A LB666A LB396A LB383A
LB416A LB183B LB17OA LB27DA LB193A LB213A LB326A LB191A LB283A LB16NA LB198A LB167A LB233A
LB21DA LB196A LB176A LBA37DA LB236A LB296A LB616A LB25DA LB446A LB206A ILB283A ILB217A
0
FY 2016 on-the-run Benchmark Bond GBI-EM Thailand - JPMCB
Source : ThaiBMA
FY2015 Secondary Trading Volume
Top 10 Turnover Ratio includes 3 series of on-the-run Benchmark Bond ( 5-10-15-yr )
Classified by Turnover Ratio As of December 2015
Turnover Ratio
THB Mil. 350,000
Current Outstanding ≥ THB 100 Bil. Current Outstanding = THB 50-100 Bil. Current Outstanding ≤ THB 50 Bil.
12 GOVT Bond series are included in JPMCB Index 3 of which are on-the-run Benchmark Bond (5-10-15-yr)
1.2
FY 2016 on-the-run Benchmark Bond
300,000
1.4
1.2
GBI-EM Thailand - JPMCB Turnover Ratio (time)
250,000
1.0
200,000
0.8
0.8
150,000
0.6
0.6
0.4
100,000 100,000
0.4 0.4
0.4 0.4 0.3 0.3 0.2
50,000
0.2 0.2
0.1
0.1 0.1 0.1
0.1
0.1 0.1
5 20
50
10
15
LB383A
LB396A
LB406A
LB316A
LB416A
LB171A
LB183A
LB198A
LB22NA
LB175A
LB214A
LB244A
LB283A
LB233A
LB213A
LB616A
LB326A
LB267A
LBA37DA
LB167A
LB19DA
LB24DA
LB183B
LB16NA
LB193A
LB27DA
ILB217A
LB446A
LB17OA
LB191A
ILB283A
LB296A
LB236A
LB176A
LB25DA
LB666A
LB21DA
LB196A
LB366A
-
LB206A
0
30
Turnover Ratio 0.1 – 2.0
Nearly No Trading
Source : ThaiBMA
19
Linking CGIF & BAHT BOND to the Development of Bond Market
0
Total Outstanding 10,086,082 THB Mil.
CGIF
0
0
0
Inaugural (Noble, Hong Kong)
0
0
THB 2,850 Mil.
0
BAHT BOND
(As of December 25th, 2015)
Baht Bond (For Asian Bond CGIF Market Initiative)
THB 88,474 Mil.
1% 0.03%
0
0
0
Corp Bond
24%
SOEs Bond
8%
0
2013 2014 2015 2016 2017 2018 2019 2020
111111 Natural Hedging
Inv’t Grade
BOT Bond
KEXIM
28%
(THB 27,000 M) CABEI (THB 4,474 M)
Targeted Industry
Lao PDR
GOVT Bond
Why now?
What next? Broadening Issuer Base : AEC Becoming bond market leader of the region
Entering ASEAN Economic Community (AEC)
(PDDF.)
20
39%
(THB 21,590 M)
2016 - 2025
Baht Bond’s Maturity Profile (Classified by Issuers) Public Debt Management Office, Ministry of Finance
THB Mil.
CLMV
30000
88,474 THB Mil.
32
%
28,090 THB Mil.
26
7%
%
25% ADB
Mizuho (23,066)
AFD
l.
Baht
Government
International
25%
Credit Rating & CGIF
(21,590 THB Mil.)
68%
Size : 3,000 THB Mil. Issue: Sep 28th, 2015
CBA
IFIs ,
(6,500 THB Mi )
(23,066)
(22,409)
20000
Non-Gov’t
(60,384
NOBLE
)
THB Mil.
KEXIM ING
11
%
10000
%
KEXIM CABEI Woori
Lao PDR (Gov’t)
Today
7
7
%
%
CITI
Woori
Hana Woori
Lao PDR (Gov’t)
KEXIM
Lao PDR
EDL-Gen
(Gov’t)
Lao PDR (Gov’t)
(8,000)
7
%
(6,330)
(5,668)
CABE
0
9
(10,000)
Woori
KEXIM CABEI Lao PDR (Gov’t)
KEXIM
(5,701)
2
%
EDL-Gen Lao PDR (Gov’t)
(1,500)
3
%
(2,800) KEXIM
3
%
(3,000)
Lao PDR (Gov’t)
EDL-Gen
KEXIM
Source : PDMO (As of December 25th, 2015)
21
2007 - 2015
Growth of Corporate Bond Outstanding has Accelerated Total Outstanding 10,086,082 THB Mil.
Baht Bond Outstanding Corporate Bond Outstanding
(As of December 25th, 2015)
% Share of Corporate Bond Outstanding to Bond Market Capitalization % Share of Baht Bond Outstanding to Bond Market Capitalization
Baht Bond
1%
88,474 THB Mil
24% 19%
000
(For Asian Bond CGIF Market Initiative)
25%
Corp Bond
88,474 THB Mil.
18%
0.03%
24%
2,078,650 THB Mil 20%
2,078,650 THB Mil.
8%
SOEs Bond
000
782,680 THB Mil.
15%
BOT Bond
000
10%
29%
2,881,487 THB Mil.
000
5%
000
1.3%
0.6%
1%
GOVT Bond
38%
3,912,414 THB Mil.
0
0% End of Dec 2015
Source : ThaiBMA (As of December
25th,
2015)
Corporate Bond & Baht Bond Outstanding (Classified by TTMs)
Average size per issuance:
2,133 THB Mil. % Share of total Corporate bond outstanding
THB Mil.
50%
1,000,000
41% 874,521
Total Outstanding :
2,167,124 Number of Corporate Bond + Baht Bond: 1,016 Average size per issuance:
2,133
THB Mil.
(Series) THB Mil.
Baht Bond Corporate Bond
25%
500,000
16% 350,905
13% 272,137
14% 307,929
13% 290,982
3% 70,650 TTM (Years) 0
0%
Source : ThaiBMA (As of December 25th, 2015)
22
-
-
-
-
Remark : Excluded Commercial Papers (less than 1 year at issue)
30%
Corporate Bond & Baht Bond Outstanding (Classified by Size) THB Mil. 200000
Corporate Bond
Outstanding (THB Mil.)
are 6 Major Corporates No. of Issuers
% Share of Outstanding
A Rated Group (AAA, AA, A) B Rated Group (BBB, BB)
CPALL PTT SCC
≥ 50,001
6
30%
10,001 – 50,000
53
56%
≤ 10,000
122
14%
Total
181
100%
Unrated
Baht Bond 150000 Baht Bond Lao PDR (Gov’t)
BahtLaoBond PDR (EDL-Gen)
100000
CPF
Lao PDR (Gov’t) 50000 50,000
THAI BAY
(BBB+) 21,590 THB Mil.
Lao PDR (EDL-Gen) (BBB+) 6,500 THB Mil.
10,000 0
Issuer 1
Issuer 181
Source : ThaiBMA (As of December 25th, 2015)
Remark : Excluded Commercial Papers (less than 1 year at issue)
50%
Corporate Bond & Baht Bond Outstanding (Classified by Credit Rating)
is A Rated
200000 THB Mil.
Corporate Bond CPALL PTT
Rating
AA Rated
SCC
A Rated BBB Rated
150000
Outstanding (THB Mil.)
AAA Rated
% Share of Outstanding
No. of Issuers
AAA
345,260
16%
15
AA
377,978
17%
30
1,078,622
50%
49
BB Rated
A
Unrated
BBB
309,286
14%
47
BB
21,121
1%
2
Baht Bond Baht Bond
Baht Lao Bond PDR (Gov’t)
Unrated
Lao PDR (EDL-Gen)
Total
34,857
2%
38
2,167,124
100%
181
100000
CPF
Lao PDR (Gov’t) 50000 50,000
THAI
BAY
(BBB+) 21,590 THB Mil.
Lao PDR (EDL-Gen) (BBB+) 6,500 THB Mil.
10,000
0
AAA
AA
Source : ThaiBMA (As of December 25th, 2015)
A
BBB
BB
Unrated
Remark : Excluded Commercial Papers (less than 1 year at issue)
23
Annual Capital Flow classified by GOVT & BOT Bond (2007 – 2015)
-110,461 THB mil. (2015YTD)
THB Mil.
350,000 300,000
250,000
+93,249
200,000 +84,003
150,000 +23,052
100,000 +129,454
50,000
0
0
-50,000
-110,461 THB mil
+196,463
+30,216 -22,494
-2,793
+117,144
.
+96,738
GOVT Bond 29,642
-1,598 -7,506
-70,952 THB mil.
-53,807
-27,157
-100,506
-100,000
BOT Bond
-39,509 THB mil. 2015 YTD
-150,000
Non-resident Net Buy/Sell in BOT Bond Non-resident Net Buy/Sell in GOVT Bond
2015 Weekly (The past 51 weeks)
As of 25th Dec, 2015
Net Change in Non-resident Holding (YTD) BOT Bond vs GOVT Bond
THB Mil.
125,000
100,000
As o
(1 USD/ THB)
Accumulative NR Holding = -110,461 THB mil.
28 29
(Since 1 Jan – 25 Dec 2015) 75,000
30
50,000
31
25,000
32
0
33
0
BOT Bond
-25,000
-39,509 THB mil. GOVT Bond
-50,000
34 35
-70,952 THB mil. -75,000
36 1 USD = 36.0980 THB
-100,000
Foreign Exchange (USD/THB)
NR Holding in GOVT Bond
NR Holding in BOT Bond
WK1 WK2 WK3 WK4 WK5 WK6 WK7 WK8 WK9 WK10 WK11 WK12 WK13 WK14 WK15 WK16 WK17 WK18 WK19 WK20 WK21 WK22 WK23 WK24 WK25 WK26 WK27 WK28 WK29 WK30 WK31 WK32 WK33 WK34 WK35 WK36 WK37 WK38 WK39 WK40 WK41 WK42 WK43 WK44 WK45 WK46 WK47 WK48 WK49 WK50 WK51
-125,000
37
24
38
As of 25th Dec, 2015
T
2015
Non-Resident Holding in THB Bond = 572,804 THB Mil.
Outstanding
Thai Bond Market Cap. =10,085,998 THB Mil.
% of Thai Thai Bond Bond Market Market Cap. % Share of (9,202,573 THB Million)
Non-Res i dent Hol di ng Non-Resident Holding (THB Mi l l i on) (THB Million)
Issuer Issuer
GOVT Bond GOVT Bond
574,063 554,532
BOT Bond Bond BOT
118,177 17,470
SOE Bond Bond SOE
00
Corp Bond Corp Bond
6.24% 5.52% 1.390% 1.28% 0.17% 1.28 0.00% 0.00% 0.01 0.01% 0.01%
802 666
572,804
TOTAL TOTAL
7.53% % 5.70
692,906
GOVT Bond Outstanding 3,912,414
BOT Bond Outstanding 2,881,487
THB Mil.
THB Mil.
Non-Resident 17,470 THB Mil.
Non-Resident 554,532 THB Mil.
Domestic Investors
Domestic Investors
2,864,017 THB Mil.
3,357,882 THB Mil.
99.4
85.8
%
%
As of 25th Dec, 2015
Peers Comparison
Non-Resident Holding in Thai GOVT Bond is 554,532 THB mil. or 14.2% of Total GOVT Bond Outstanding
(C
Percentage share of Non-resident Holding in Local Government Bond (Mar 2008 - Present)
40%
Indonesia
37.67% Sep’ 15
Malaysia 30.50%
30%
Sep’ 15
Peak @ 19.1% (Apr’ 13)
Thailand
20%
14.2%
As of 25th Dec,15
Korea 9.96%
10%
Sep’15
Japan 9.20% Jun’ 15
Mar-08 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 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 DecDec-15
0%
2008
2009
Source : AsianBondsOnline, ThaiBMA
2010
2011
2012
2013
2014
2015
As of 25th Dec, 2015
25
Source: Public Sector Development Group, PDMO
Pro-active Debt Management
Develop Domestic Bond Market to be a Sustainable Source of Funding for the Stability of Thailandâ&#x20AC;&#x2122;s Financial System
Foster Strong and Effective Organization
3 PDMOâ&#x20AC;&#x2122;s Strategies
Formulate sound public debt management policies and strategies as well as conduct, monitor and evaluate public debt management operations under the relevant legal framework and guidelines
Mission
Transparency, Discipline, Trustworthiness, Driving Social and Economic Development
Values
Professional in public debt management for sustainable development
Vision
For Further Information : Upama Jaihong
upama@pdmo.go.th
Executive Director of Bond Market Development Bureau
Nattakarn Boonsri
nattakarn@pdmo.go.th
Acting Senior Expert on Bond Market Development Director of Government Bond Market Development Division
Paroche Hutachareon
paroche@pdmo.go.th
Director of Fund Management and Bond Market Infrastructure Development Division
Oraporn Thomya
oraporn@pdmo.go.th
Acting Director of International Bond Market Policy Division
Nakarin Prompat
nakarin@pdmo.go.th
Acting Director of Financial Product Development Division