Moody's cuts two Thai banks

Moody's Investors Service said it took rating actions on the deposit and debt ratings of three Thai banks. The actions conclude a review that began May 27. The banks affected are Export-Import Bank of Thailand (EXIMT), Siam City Bank (SCIB) and TMB Bank (TMB).

Consistent with the analytical criteria specified in a new report - and in light of Thailand's current situation and future prospects - Moody's said the systemic support input for Thai bank ratings be changed to A2 from Aa2, the former being two notches above Thailand's local-currency government debt rating of Baa1.

This change has led to the downgrade of Export-Import Bank of Thailand's foreign-currency issuer rating to Baa1 from A3 with a negative outlook and TMB Bank's foreign-currency deposit rating to Baa3/prime-3 from Baa2/prime-2 with a stable outlook.

Moody's also said it examined the banks' short- and long-term liquidity positions in relation to their corresponding ratings. As a result, Siam City Bank's foreign-currency short-term deposit rating was upgraded to prime-2 from prime-3 with a stable outlook. This reflects the bank's heightened ability to repay short-term debt obligations, Moody's said.

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