Moody's rates TMB Bank securities Ba2

Moody's Investors Service said it assigned a provisional Ba2 rating to Thailand-based TMB Bank PCL's (Baa2/on review for possible upgrade) proposed perpetual securities, which will be issued via a Cayman Islands branch under the new guidelines of Bank of Thailand governing hybrid tier 1 securities. The outlook is stable.

The Ba2 rating reflects the structure of the issue, TMB Bank's moderate financial fundamentals and Thailand's supportive regulatory regime, the agency said.

Under the terms of the securities, the issuer can call the securities after 10 years. Typical of many tier 1 capital-qualifying hybrid security issues, interest on TMB Bank's securities is non-cumulative and under certain circumstances may be deferred at the issuer's option. Moody's said if implemented, such provisions, while not legally constituting an event of default, could result in payment terms appreciably different from senior securities.

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