Kot bond market booklet q1 fy2016 by pdmo pdmo

KINGDOM OF THAILAND BOND MARKET FINANCING THAILAND’S FUTURE & CONNECTING ASEAN

Q1/FY2016

Public Debt Management Office, Ministry of Finance, Kingdom of Thailand Highlight Executive Interview : Mr.Suwit Rojanavanich (Director-General of Public Debt Management Office)

Progress Update

Basic & Essentials

» Committing to FY2016 Fund Raising Plan » GOVT Bond Auction Results » T-Bill Plan Q1/FY2016 » New Allotment Framework for NCB » GOVT Bond Auction Schedule Q1/FY2016 » PDMO Bond Calendar FY2016

» 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 Aug 2015)

5,736,644 THB Mil. (42.81% of GDP)

Well-Developed Bond Market Improved GOVT Direct Debt Profile Dramatically (as of Aug 2015) » Average-Time-to-Maturity (ATM) 11yrs 7mths » Average Cost 3.82% » Well-Balanced Fixed : Floating Ratio 89 : 11 » Well-Distributed Maturity Profile 36:21:43 (TTM<5 : 6-10 : >10yrs)

Bond Market Capitalization (as of Sep 2015)

9,747,040 THB Mil. (70% of GDP)

Liquidity & Secondary Market Trading

82% of Trading Volume (Outstanding > 100,000 THB Mil.)

Baht Bond Outstanding and its Market Share (as of Sep 2015)

96,574 THB Mil. (1% of Bond Outstanding)

Non-Resident Holding in Domestic Bond (as of Sep 2015) » Annual Capital Flow (YTD)  GOVT Bond :

-96,030 THB Mil.

 BOT Bond :

» NR Holding in THB Bond  GOVT Bond :  BOT Bond :  Others :

-52,262 THB Mil. -43,768 THB Mil.

587,197 THB Mil. (6.02% of Thai Bond Market Cap.) 573,222 THB Mil. (15.4% of GOVT Bond Outstanding) 13,212 THB Mil. (0.5% of BOT Bond Outstanding) 763 THB Mil.

Stronger Together Thailand

Mr.Suwit Rojanavanich Question: Firstly, we would like to congratulate your appointment as Director-General. Your arrival comes at a challenging time for the Thai economy, of which a new economic team has been put in place with new policies. What is the PDMO’s role in supporting them?

Mr.Suwit: First of all, I am honored to be appointed as DG of PDMO. As the “new guy” here, I am pleased to say that I have been warmly welcomed by both the staff at PDMO and it is nice to back amongst familiar faces. I very much look forward to working closely with all stakeholders involved with debt management, both public and private, under the vision of “Stronger Together Thailand”. As you mentioned, it is indeed a tough and challenging time for the Thai economy. Global economic conditions have also been volatile, with slowdowns in most major economies with the exception of signs of recovery in the US. Even so, the delay of the Fed rate hikes still adds more volatility to the financial market. Before I discuss the role of PDMO in supporting new economic policies, I would like to emphasize that Thailand’s economic fundamentals remain strong, backed by high foreign reserves and public debt/GDP that is well below ceiling of 60%. Therefore, in the short run the government aims to boost confidence, by means of empowering of the low income level, local communities and local enterprises as recently announced as the “Pracha Rat strategy”. Whilst, in the long term, this government’s effort is also about laying the fundamentals for the future generations by expediting infrastructure investments that would also support regional connectivity going into AEC next year. PDMO’s role as part of the Ministry of Finance, our office is the only entity that is directly responsible for the government borrowings to fund budget deficits and infrastructure projects. Given the current low interest rate environment, this makes an opportune time for us to fund raise. In addition, as advisors we support SOEs and SFIs in the executions of some key policies such as loans to village funds to ensure successful implementation and liquidity support if deemed necessary. For infrastructure to reduce burden on government’s balance sheet and enhance transparency and public involvement, we work closely with implementing agencies to identify projects or operations that can be PPP projects. Whilst to support further disbursements of money into the economy whilst bringing us closer to longer development goals, we ensure projects move forward as planned with close monitoring.

Director-General of PDMO

Question: Government savings bonds have always been an attractive investment option for the public. During current low-interest rate environment many retail savers must be eagerly waiting for news on upcoming issuance. What are the plans for savings bond in FY2016?

Mr.Suwit: PDMO will continue its role in promoting savings amongst the public by ensuring that the public have regular access to our savings bond. Last year our savings bond, particularly the shorter issuances of 3 year tenors, sold out quickly. As for this year, issuances of savings bond will also help absorb the increasing investment demands owing to large refunds received by retirees switching back to the pension system (The Undo Act Bill) in October 2015 and the maturing of 2009 Step-up savings bond (Thai Khem Kaeng program) in June 2016. In total PDMO will issue new savings bond in total of approximately 100,000 million baht. Half of the amount will be released this coming October, so savers need to stay tuned for further details.

Market Dialogue and MOF Awards 2014 Public Debt Management Office

The Hongkong and Shanghai Banking Corp. Ltd. Best Primary Market Contributor Best Secondary Market Contributor 11 September 2015 Vayupak 4, Ministry of Finance

Myanmar Global Investment Forum 15- 16 September 2015 Myanmar International Convention Center 2 Nay Pyi Taw, Myanmar

“Thailand’s domestic bond market experience and supporting ASEAN inclusive growth the promotion of cross border fund raising”

Dr.Pimpen Ladpli, Executive Director, Bond Market Development Bureau, Public Debt Management Office, Ministry of Finance, Thailand

Savings Bond Savings Bond FY2016 No. 1 will be issue on October 19th, 2015

Features ThaiBMA Symbol

SB18OA

Tenor

3-Years

Coupon Rate (p.a.)

3.00%

Issue Size Sale period

Sale Amount

October 19th, 2015 â&#x20AC;&#x201C; February 29th, 2016 Min. 1,000 THB Max. 2,000,000 THB Unlimited number of transactions for individuals but total purchasing amount could not exceed 2,000,000 THB of bond per 1 appointed bank

Coupon payment date Maturity date

Paid semi-annually on April 19th and October 19th each year October 19th, 2018

Eligible Customers

Retail and non-profit organization such as foundations, Thai Red Cross Society, and the National Council on Social Welfare of Thailand

Distribution Channels

50,000 THB

4 Appointed banks : - Bangkok Bank Public Company Limited - Krung Thai Bank Public Company Limited - Kasikorn Bank Public Company Limited - Siam Commercial Bank Public Company Limited

Progress Update  Total Fund Raising Plan FY2016  GOVT Bond Auction Results

 T-Bills Plan Q1/FY2016  New Allotment Framework for NCB

 GOVT Bond Auction Schedule Q1/FY2016  PDMO Bond Calendar FY2016

2016 - 2022

Government Funding Needs

Infrastructure Investment

PPPs 36,xxxMB

SOE Revenue 13,xxxMB

1,912 THB Bil.

265,XXXMB

(2015-2022)

Public Debt 129,xxxMB

GOVâ&#x20AC;&#x2122;T Budget 87,xxxMB 86MB

4,XXXMB 59,XXXMB

350 - 450 THB Bil. Per year

Insurance Decree

1,XXXMB 61,XXXMB 63,XXXMB

Substitution for foreign currency bond On-Lending

390,000

Deficit Bill

58,940

(2016-2022)

200,666

344,084

300,000

250,000

Repayment of SOE Debt (consists of 93% of Restructuring and 7% of New Debt)

Per year

80,XXXMB

GOVT

Rollover 350 - 500 THB Bil.

-0-

52,000

149,209

231,000

307,945

187,898

FY 2016

113,014

340,122

191,095

129,124

FY2011

FY2012

FY2013

FY2014

59,374 FY2015F

403,367

62,442

112,708

98,400

104,236

264,863

106,958

101,800

37,900

109,000

-0-

FY2017F

FY2018F

FY2019F

FY2020F

FY2021F

FY2022F

FY2016

* To be considered by Ministry of Finance

937,XXX MB * Include Infrastructure Investment

-Tentative1,xxx

Substitution for Foreign Currency

61,xxx 63,xxx

On-lending

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

150,539

FY2016F

Total GOVT Fund Raising Plan

Insurance Decree

Rollover Govt Debt

50,xxx 40,xxx

50,xxx 80,xxx

Repayment of SOE Debt (BAAC)

188,xxx

Loan Bond 5-10-15-20-30-50 yrs

460,xxx

Rollover FIDF Debt

104,xxx By bills

* To be considered by Ministry of Finance

187,771

FIDF

(2016-2022)

515,XXX MB

1,591,xxxMB

56,XXXMB

2,XXXMB

New Borrowing

700 - 950 THB Bil. per Year

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

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

Insurance & GPF & SSO

Issuing New Debt

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)

Almost Benchmark Bond Supply Increase Year on Year THB mil.

13% increase in FY2016

Amount of Benchmark Bond to Actual Fund Raising (FY2009 – FY2016)

1,000,000

750,000

13%

-11% 500,000

43% 2% 10% 49%

250,000

2009

2010

2011

2012

2013

2014

2015

2016

For 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

460,000Mil. (85%)

40,000Mil. (15%)

5,000 – 10,000

500,xxx MB

Total Benchmark Bonds

300,000

Total

-TentativeTop-up

15 10

Top-up

100,000

Top-up

200,000

TTM

8 9

10 11 10

13 14 15 16 17-18 19-20 21 22 23 24 25 26-27 28 29 30

31-39

40 40

41-44

LB666A LB666A

LB616A

LBA566A

LB446A LB446A LB453A ILB453A

New-Issue

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 LB267A

New-Issue

50 20

45-49

50 50

FY2015

 Low Cost of Funding  High Volume of Short-term Demand

T-Bill Auction Result

THB Mil.

Basis Points

75,000

7.5

60,000

6.0

45,000

4.5

30,000

3.0 1.5

15,000

1.8 0.5

T-1= 0

1.5

1.5 0.8

0.0

0.3

-0.2

-0.6 -1.1

-15,000

-0.8 -1.3 -1.4

-0.4

-0.3 -0.6

-0.9

-0.9 -1.1 -1.4

-1.9

-30,000

-1.5 -1.6

-1.5 -2.5

-1.9 -2.2

-2.6

-2.7

-3.2

-3.9

-45,000

-3.4 -3.7-3.8

-5.3

-5.6

-6.4

Nov-14

OCT

Dec-14

Jan-15

NOV

Feb-15

DEC

Mar-15

JAN

-3.0

-3.4

-3.6

-4.5

-4.2

T-bill (Allocated Amount) Participated Amount (Excess Demand) Not Fully Allocated or Subscribed Spread [AAY-Yield(T-1)]

-75,000 Oct-14

-2.1

-2.6

-4.2

-4.4

-60,000

-1.9

-2.2 -2.9

-3.3

-3.4

-3.6

-2.3

-2.6 -2.6

Apr-15

FEB

May-15

MAR

Jun-15

APR

Jul-15

MAY

Aug-15

-6.0

-7.5

Sep-15

JUN

FY 2015 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)]

Bps

THB Mil. 100,000

80,000

75,696

60,475

58,919

60,000

44,090

40,000

41,142

8.2

34,055

10.5 5.9

30,164

6.0

20,000

3.3

3.9

T-1= -0 -20,000

20,000

4,000

17,026

7,978

5,972 4,000 5,970

15,275 17,766 14,194

1,802

7,600

3,028 6,525 4,030 9,000 12,000

4,000

9,000

5,212 3,788

562 9,000 23,976 14,198

4,438

-1.8

18,438 13,496

12,010 3,840

15,480

10,725

8,563

13,200 10,120

10,060

1.7 -1.4 -2.4

15,650

14,365 11,800

-0.4

16,555

-2.8 -4.1

-6.1

-6.7

5 0

-0.8

-2.7

-3.4

-5.6

-40,000

0.4

-1.0

-4.1 -5.2

0.5

0.2

-0.6

-0.9

-3.6

19,580

17,845 15,250

1.3 -0.2

-0.4

5.4

9,000 6,000 6,160 23,803 10,000 14,000 9,000 24,000 9,000 8,000 10,000 23,779 7,000 20,000 9,000 10,00010,000 6,00020,000 7,000 10,000 7,000 13,000 5,000 5,000 4,255 10,000 6,000 5,000

1.5 -1.1

10 24,909

22,145 16,085

2.613,950 22

4,350

8.9

36,610

28,293

-5

-6.4

-7.9

-10

-8.5

-9.8

-9.9 -11.3

-60,000

-15

9 Sep 2015

23 Sep 2015

2 Sep 2015

26 Aug 2015

19 Aug 2015

28 Jul 2015

11 Aug 2015

8 Jul 2015

15 Jul 2015

8 Jul 2015

3 Jun 2015

24 Jun 2015

27 May 2015

20 May 2015

6 May 2015

20 May 2015

29 Apr 2015

22 Apr 2015

8 Apr 2015

22 Apr 2015

25 Mar 2015

3 Mar 2015

18 Mar 2015

25 Feb 2015

18 Feb 2015

11 Feb 2015

4 Feb 2015

11 Feb 2015

21 Jan 2015

7 Jan 2015

14 Jan 2015

9 Dec 2014

17 Dec 2014

3 Dec 2014

26 Nov 2014

19 Nov 2014

29 Oct 2014

12 Nov 2014

29 Oct 2014

21 Oct 2014

-80,000

21 Oct 2014

-15.5

-20

FY2015 GOVT Bond Auction Results Classified by Tenor Benchmark Bond 5 – 10yr

THB Mil.

5yr

100,000

Benchmark Bond 15 – 50yr

15yr

10yr

(Exclusivity)

Bps

30yr

50yr

75,696

80,000

20 60,475 58,919

60,000

44,090 41,142

40,000

36,610

34,055 30,164

5.9

28,293

6.0

8.9

24,909

19,580

3,9763,8034,0003,779

20,000

1,802

3.9

15,250 11,800

T-1= -0

20,000 20,000 20,000 20,000 20,000 20,000 20,000

-1.8 -20,000

12,000

14,198

14,000 13,000

2.7

1.7 -1.0

-1.4

-2.4

9,275

16,085 10,120

10,725

3,840 10,000 10,000

7,978

9,000

6,160

9,000

1.3 -0.8

-0.4

6,000

9,000

10,000

8,000

745

9,000

4,255

5,212 5,922

3,788

6,000

7,000

1.5

0.4 -2.8

-9.8 Short-term Benchmark Bond (<10 yrs) Long-term Benchmark Bond (>10 yrs) Greenshoe Amount Not Fully Allocated or Subscribed Average Accepted Yield

-0.9 -0.9

0.2

-5

-3.6

-40,000

-80,000

14,365

3,028

8,563

-5.6 -6.1

-60,000

15,145 11,438

17,026

13,496

13,950

0.5

-0.4

-0.2 -0.6

16,555

-6.4 -10

-8.5 -9.9 -11.3

-15

-20

FY 2016

T-Bills Plan 3 & 6 months T-bill : Issue on demand

THB Mil. 30,000

T-bill 1 month

25,000

T-bill 6 months

20,000

15,000

6 months

6 Months

10,000

5,000

1 month T-bill : Rollover 0 wk1 wk2 wk3 wk4

wk1 wk2 wk3 wk4

Oct-15

Nov-15

Dec-15

Jan-16

Feb-16

Mar-16

Apr-16

May-16

Jun-16

Jul-16

Aug-16

Sep-16

Nov-15

Dec-15

Jan-16

Feb-16

Mar-16

Apr-16

May-16

Jun-16

Jul-16

Aug-16

Sep-16

Oct-15 30,000

25,000

New Allotment Framework for NCB

NCB Bidding Amount Individually Minimum

Maximum

Before January 2013

20%

4 THB mil.

40 THB mil.

From January 2013 to present

20%

4 THB mil.

100 THB mil.

20,000

15,000

New Bidding Amount

4 THB mil.

20%

15,000 MB 15,000 MB 15,000 MB 15,000 MB

10,000

Bidding Amount

NCB Issue Amount / Auction

Not exceed 20% of auction amount

Begin January 2016

5,000

NCB Allotment Oct-15

Nov-15

Dec-15

Jan-16

Feb-16

Mar-16

Apr-16

May-16

Jun-16

Step 1 : Allocate bids for the first 100 million baht Step 2 : Allocate amount over 100 million baht by Pro-rata

Begin : January 2016

Jul-16

Aug-16

Sep-16

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF 13FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE

LB25DA = LB296A = LB A = LB446A = LB6 A =

LB206A =

26-Jun-2020

2.55%

Coupon

Maturity Date

51,000

27,000

Total

30 December 2015

23 December 2015

16 December 2015

9 December 2015

2 December 2015

25 November 2015

18 November 2015

11 November 2015

4 November 2015

28 October 2015

Re-open

4.875%

26,000

17-Jun-2036

To be announced on 16 Nov 2015

11,000

(Greenshoe Option) (Greenshoe Option)

MPC

13,000

22-Jun-2029

MOF Outright PD MOF Outright PD Re-open Re-open

1 Re-open

12-Dec-2025

3.85%

13,000

MPC

13,000

29-Jun-2044

4.675%

19,000

10,000

9,000

– –

17-Jun-2066

To be announced on 23 Nov 2015

9,000

New

LB666A 50-yrs

Total

129,000

27,000

10,000

13,000

9,000

11,000

13,000

33,000

24,000

LB446A 30-yrs

21 October 2015

LB366A 20-yrs New

LB296A 15-yrs

14 October 2015

LB25DA 10-yrs

LB206A 5-yrs Exclusivity

7 October 2015

Auction Date

Government Bond Auction Schedule for Q1/FY2016

Quarter 1

Quarter 2

Mar 2016

Feb 2016

Jan 2016

Dec 2015

Nov 2015

Oct 2015

Makha Bucha Day

Quarterly PD Market Dialogue

H.M. The King's Birthday observed

Last day of submission for Baht Bond Application (1/2016)

First day of submission for Baht Bond Application (1/2016)

Auction T-bill

New 20Y

MOF Outright PD Committee : Quarterly PD's Evalution First day of submission for Baht Bond Application (2/2016)

Action LB446A (30Y) : 10,000MB

New 50Y

Action LB206A (5Y) : 27,000MB

Action LB296A (15Y) : 13,000MB

Action LB666A (50Y) : 9,000MB

Action LB366A (20Y) : 11,000MB

Action LB25DA (10Y) : 13,000MB

Action LB296A (15Y) : 13,000MB

LB446A (30Y) : 9,000MB

21 Action LB206A (5Y) : 24,000MB

Retail 20 Only

Wed

Tue

Auction T-bill

19 Issue Regular Saving Bond 1/2016(3y) : 50,000 MB (19 Oct 15 - 29 Feb 16) 26

Mon

MPC

Constitution Day

MOF Outright PD Committee

Thu

Last day of submission for Baht Bond Application (2/2016)

New Year's Eve

Quarterly PD Market Dialogue

PDMO Bond Calendar FY 2016

Quarterly Macroeconomics Report (FPO)

New Year's Day

Baht Bond 1/FY2016

Quarterly Macroeconomics Report (FPO)

Chulalongkorn Day

Fri

Sat Sun 3

Quarter 3

Quarter 4

Sep 2016

Aug 2016

Jul 2016

Jun 2016

May 2016

Apr 2016

First day of submission for Baht Bond Application (3/2016)

MOF Outright PD Committee : Quarterly PD's Evalution

Labor Day observed

Long-term Investor Meeting

Baht Bond 2/FY2016

Asalha Bucha

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

+ MOF Awards

15 Annual PDMO-Market Dialogue

H.M. The Queen's Birthday

Last day submission for Baht Bond Application

Quarterly Macroeconomics Report (FPO)

Mid-year Bank Holiday

Visakha Bucha

Remark : Royal Ploughing Ceremony Day- waiting for an annoucement This schedule is subject to change without prior notice.

Quarterly Macroeconomics Report (FPO)

Songkran Festival Day

12 - 15 Money Expo

Peers Comparison

BOND market capitalization Source : Asian Bond online (ADB)

BOND mkt. cap : GDP

Government BOND Yield Curve

Hundreds

226%

10%

Indonesia

Public Sector (GOVT + CB + SOE) Private Sector

127% 96%

72% 50%

Vietnam

23% 6%

Malaysia 5%

China 4.03%

Philippines

Share of PUBLIC sectorâ&#x20AC;&#x2122;s Bond to Total BOND mkt. cap. USD Billions 300

% : BOND mkt. cap.

99% 100%

86%

Korea Japan

60%

57%

109

50%

SOE 23

150

USD Billions

2.29%

165

140

BOT 85

-1%

0 Vietnam

Indonesia

Thailand

76% GOVT

Singapore USA

2.83%

84%

107

3.77%

Philippines

Thailand

Singapore

Te n o r

Malaysia As of September 28th ,2015

Government BOND Yield Matrix

3.98%

3.60%

3.79%

2.84%

4.07%

ASEAN & Peers

th ,2015 As of September 28 2.23 %

1.64%6 m

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 1.51

Japan

-0.02

0.01

0.02

0.04

0.06

0.08

0.11

0.19

0.27

0.35

1.13

1.39

USA

0.10

0.34

0.67

0.97

1.20

1.42

1.61

1.80

1.90

2.00

2.10

2.51

2.87

1.29

1.41

1.65

1.90

2.14

2.24

2.34

2.45

2.55

2.65

2.93

2.95 3.77

3.94

4.03

4.29

4.34

Singapore Thailand

1.51

1.58

1.82

2.06

2.29

2.53

2.65

2.74

2.78

2.83

3.57

Korea

1.51

1.53

1.58

1.61

1.70

1.79

1.85

1.92

1.99

2.06

2.13

2.30

Philippines

1.69

1.87

3.13

3.08

3.75

3.43

3.80

4.18

4.03

3.89

3.74

4.36

China

2.60

2.73

3.03

3.29

3.41

3.54

3.60

3.66

3.65

4.10

4.24

Malaysia

3.09

3.18

3.42

3.69

3.82

3.94

4.15

4.36

4.37

4.38

4.77

5.09

5.10

5.50

6.08

6.24

6.40

6.68

6.95

7.02

7.08

7.15

8.30

8.86

9.16

9.32

9.41

9.46

9.48

9.51

9.53

9.55

9.78

9.84

Vietnam Indonesia

7.85

Brunei Cambodia Laos Myanmar

50 yr

below 1%

2.01% - 3%

over 4%

1.01% - 2%

3.01% - 4%

no data

Basic & Essentials  Bond Market Development Strategy  Public Debt Outstanding

 Total Domestic Public Debt  Bond Market Capitalization

 Liquidity & Secondary Market Trading  Supporting Inclusive Growth Through ASEAN Bond Market Integration

 Non-Resident Holding in Domestic Bond

 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 : 1,150,000 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

Debt Folio Enhancement Market Infrastructure

Foreign Currency Bond 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

Strengthening PD system

Activated Public Debt Management Fund

(Exclusivity, League Table, Greenshoes Option)

STRIPS Bond

Scripless Retail Savings Bond  Saving Habit

Innovation / Product Development Market Consultation

Inaugural 10-yr Inflation-Linked Bond (10-yr)

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

Quarterly PDMO one-on-one PD Dialogue

Quarterly PDMO one-on-group “MOF Outright PD Dialogue

Building Yield Curve / Enhancing Liquidity

15 10 7 5 3

8 Tenors of Benchmark Bonds

300,000 MB

Liquidity-Oriented

150,000 MB Outstanding Amount 3 5 7 10 15 20

FY 2012-2016

FY 2011

FY 2007-10

FY2007 – FY2016

Innovation of GOVT Debt Securities

30-yr Benchmark Bond

• Lengthen average-time-to-maturity of Total Government Debt Portfolio • Meet Long-term investors’ demand

Floating Rate Bond

• Increase floating debt ratio of Total Government Debt Portfolio • Promote BIBOR (Bangkok Interbank Offered Rate)

Step-up Savings Bond

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

Fixed Rate Promissory Note

• Broaden investor base – Insurance / Long-term investors • Non-Benchmark tenors

50-yr Benchmark Bond

• Combat low interest rate + Lengthen average time-to-maturity • 4th country in the world (1st : UK 2nd : France 3rd : China)

10-yr Inflation-Linked Bond (ILB)

• Strong anti-inflationary signal • Deepen the Development of the Bond market • 1st country in Emerging Asian Economies

Electronic Retail Savings 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

Amortized Bond

• 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

Bond Switching & Consolidation

Upgrade PD Privileges

• Allow both issuer and investors to improve their portfolio • Larger outstanding size + Less bond series  Enhance liquidity in the secondary market

PDDF Activated

15-yr ILB 30-yr ILB

(Public Debt Restructuring and Domestic Bond Market Development Fund)

CGIF Activated

Baht Bond

(Credit Guarantee and Investment Facility)

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) CGIF 0.03%

Domestic Bond Market (Classified by Credit Rating)

Baht Bond 1%

BB & Unrated

BBB 4%

24%

Government

AA 4%

12% Government

38%

SOEs

SOEs 8%

BOT

Total of 9.6 THB Trillion

Source : ThaiBMA (end of Sep 2015)

NR 17% 15%

Insurance Insurance and and Other OtherCorporation Corporation

36 41%%

38% BOT

29%

Household and Non-profit

5% BOTBOT 6% NR 5%

A Corp Bond

Government Debt Securities (Classified by Types of Investors)

Total of 9.6 THB Trillion

Source : ThaiBMA (end of Sep 2015)

Depository Corporation Depository Corporation %

33%

Total of 3.5 THB Trillion

Source : BOT (end of Sep 2015)

Public Debt Outstanding (as of Aug 2015) = 5.74 THB Trillion (42.81% of GDP) Components of Public Debt

Units : THB Mil.

3,099,696* 1,011,191 1,051,658 551,176 22,923

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

0.40% Special Financial Institutions Guaranteed Debt

9.61

% 551,176 THB Mil.

5,736,644

Public Debt Outstanding

22,923 THB Mil.

*Included of External GOVT Debt 82,877 THB Mil. Excluded of External SOE Debt 269,705 THB Mil.

Non-Financial State Enterprise Debt

18.33% 1,051,658 THB Mil.

GOVT Debt 54.03% 3,099,696 THB Mil.

GOVT Debt (for FIDF)

17.63% 1,011,191 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 ”

5.74 THB Trillion

3.66 THB Trillion

Autonomous Agency Debt

Special Financial Institutions Guaranteed Debt 9.61% 55,176 THB Mil.

Non-Financial State Enterprise Debt

18.33% 1,051,658 THB Mil.

0.40% 22,923 THB Mil.

Special Financial Institutions Guaranteed Debt

serviced by the government

Autonomous Agency Debt

serviced by the government 0.04%

8.17%

GOVT Debt 54.03%

GOVT Debt 53.31 % % 53.62

3,099,696 THB Mil.

GOVT Debt (for FIDF)

17.63% 1,011,191 THB Mil.

As of Aug 2015

Non-Financial State Enterprise Debt

100%

serviced by the government

1.94%

64%

* Excluding Foreign Debt

Assumptions : 6 months BIBOR = 1.76%, 6 months Fixed Deposit Rate = 1.23%, Inflation = -1.19% 400,000

Non-financial SOEs 11,780

Autonomous-Agencies

 ATM  Avg. Cost  Fixed : Floating  Callable

11% 0%

TTM Fiscal Year

Next 5 yrs

FIDF 1

400,000

FIDF 3

GOVT Debt (for FIDF) = 1,011,191 THB Mil.

 ATM  Avg. Cost  Fixed : Floating  Callable

TKK

On-lending Loan

Water Decree

GOVT Direct Debt (exclude FIDF) = 3,016,819 THB Mil.

20,000

(Excluding foreign debt 82,877 THB mil. )

   

= 11yrs 7mths = 3.82% = 89: 11 = 7%

ATM Avg. Cost Fixed : Floating Callable

TTM Fiscal Year

165,902

27,800

29,800

36% 0

85,00012,000

95,936

13,000 20,000

177,379

10 yrs +

Maturity Profile

5,500

6,500

9,000

33,58135,000 0

24,700 142,252

41,900

239,798

2,200

43,000

59,141

50,664

79,500 18,900

289,104

381,367

62,524

164,529

86,630 27,110 6,500

16,000 13,548

T-Bill

6-10 yrs

Next 5 yrs

(1) (2) (3) (4)

Well-Developed Bond Market Improved

GOV’T Direct Debt Profile Dramatically

21%

43%

0 0

22,000

Budget Deficit

11,836100,872

162,348

100,000

120,337

200,000

Maturity Profile

Next 5 yrs

300,000

= 4yrs 6mths = 3.97% = 89: 11 = 8%

10%

TTM Fiscal Year

400,000

10 yrs +

34%

74,000 28,198

126,850 71,000

37,900

101,800

40,00069,000

6-10 yrs

56% 25,000 81,810

23,23267,537

100,000

136,863

128,000

300,000 200,000

= 1yrs 10mths = 2.99% = 56: 44 = 46%

89%

2,600

2,987 2,127 8,000

8,000

10,842

financial SOEs

Excluding Not serviced by GOVT 836,465 THB Mil. External SOE debt (Serviced by GOVT) 62,270 THB Mil. External SOE debt (Not-Serviced by GOVT) 207,435 THB Mil. 37,90810,400 400

71,000

HB mil.)

10,000 2,033

100,000

151,628 181,880

200,000

As of Aug 2015

SOE Debt (Serviced by GOVT) = 519,586 THB Mil.

300,000

20,000 60,000

HB Mil.

Total Domestic Public Debt = 5.38* THB Trillion

6-10 yrs

10 yrs +

ATM Lengthened Cost Lowered Well-Balanced Fixed-Float Ratio Well-Distributed Maturity Profile

Note : Government Direct Debt = 3,016,819 THB Mil. (exclude FIDF and external debt)

As of Dec 2007

ATM

Average-Time-to-Maturity LENGTHENED by 6yrs 4 mths

Avg. Cost LOWERED by 68 bps.

As of Aug 2015

11yrs 7mths

ATM

5yrs 3mths

Avg. cost

4.5%

(While ATM Lengthened by 6yrs 4mths)

Avg. cost

3.82% Floating

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

10%

Fixed

90%

89%

54%

Well-Distributed Maturity Profile

Floating

28%

18%

36%

21%

11%

43%

(Maturing Debt in the next 5 yrs is less than 50% of Total Debt)

next 5 yrs year 6 -10

10 yrs +

next 5 yrs year 6 -10

10 yrs +

Bond Market Cap. = 9.7 THB Trillion

($269 Bil.)*

% Share of GDP

GOVT Bond = 3.7 THB Trillion ($102 Bil.)*

Domestic Bond Market Classified by Issuer

140%

Baht Bond

128% 120%

(Foreign Issuers Bond)

100%

(For Asian Bond 0.03% CGIF Market Initiative)

103% 98%

80%

72%

60% 40%

Asian Fin. Crisis

20%

Corp Bond

24%

SOEs Bond

24% 12%

BOT Bond

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Jul-15 Aug-15

0% Bank Loan /GDP

Equity/GDP

29%

2,862,244 THB Mil.

Bond Market / GDP

Maturity Profile BOT vs GOVT Bond

8% 79%

≤1

3838 %%

GOVT Bond

BOT ATM = 8mths GOVT ATM = 11yrs 7mths *End of Aug 2015

3,713,525 THB Mil.

19% 21%

15%

24%

34%

1<yr≤3

3<yr≤5

5<yr≤10

10<yr≤50

end of Sep 2015

*Source: BOT Exchange rate as end of Sep 2015

Full Capacity* of All Government Funding Instruments

1,150,000 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. 30,000 THB Mil. 20,000 THB Mil.

($4.3 Bil.)** ($3.4 Bil.) ($2.3 Bil.) ($2.3 Bil.) ($1.7 Bil.) ($1.7 Bil.) ($0.9 Bil.) ($0.6 Bil.)

($32 Bil.)**

Thailand’s Loan Bonds (LBs) weighting in international indices

GBI-EM Global JP Morgan

iBoxx Asia ex Japan Markit

8.5%

Asian Local Markets HSBC

9.5%

7.9%

Benchmark Bond

Last Update : Aug 2015

4.25

4.00

3.75

3.50

3.25 3.00

2.75

2.50

The “Missing Composition” of Leader role in the Bond Market Government Funding Instruments

2.25

Infrastructure

2.00 1.75

liquidity

Benchmark Bond

1.50 1.25

TTM

3 5 7

Source: ThaiBMA Government Bond Yield Curve (end of Sep 2015)

($17.7 Bil.) ($3.0 Bil.) ($3.0 Bil.) ($2.4 Bil.)

Benchmark Bond

~600,000THB Mil. (52%)

Savings Bond

~100,000THB Mil. (8%)

Amortized Bond

~100,000THB Mil (8%)

Inflation-Linked Bond

~80,000THB Mil. (7%)

($1.2 Bil.) ($0.9 Bil.) ($5.9 Bil.)

Promissory Note

~40,000THB Mil. (4%)

($34 Bil.)

Total

Floating Rate Bond Bank Loan

~30,000THB Mil. (3%) ~200,000THB Mil. (18%)

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

50 **Source: BOT Exchange rate (As of Sep 22nd ,2015)

Keep our word… to get investors confidence for the plan Unit : Million Baht Lower-than-expected disbursement of Water Decree

1,250,000

Lower-than-expected disbursement of Water Decree

1,000,000 Economic Recovery

750,000

Delay of Infrastructure Investment Plan

Higher-than-expected revenue collection

Stimulus package to ease: US financial crisis

Pro-Active Debt Management: Bond Switching

-6%

500,000

-0.6%

-1% 0% 250,000

+5%

-3%

+2%

Plan Actual

Plan: Actual:

Announced Government’s funding need at PDMO’s Annual Market Dialogues in September Actual fund raising at the end of fiscal year (calculated from announced auction)

--------------

The difference between ‘’the announced’’ and ‘’the actual’’ supply of benchmark bond (% share)

Plan

Actual

Plan Actual

Benchmark Instruments are Benchmark Bonds : Loan Bond (LB) tenors 5-10-15-30-50yr (in FY 2015) + Innovative Products : Inflation-linked Bond (ILB) + Amortized Bond (LBA) Regular issuance/ Consultation with PDs/ Pre-announced auction table

Other Instruments : Saving Bond, Floating Rate Bond, Promissory Notes, Bills and Bank Loan

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF 25 FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE

FY2008-FY2015 Key Success Indicators

1. Trading Volume 3. Demand Concentration

2. Turnover Ratio 4. Auction Price

5-yr Benchmark Bondâ&#x20AC;&#x2122;s Higher Turnover Ratio : Even the higher outstanding size, turnover ratio is still more than 2 times

Benchmark Bond 5 yrs and Below : Highest secondary trading volume in every year Unit: % Share of Market Trading Volume

Unit: Times

LB155A

LB176A

LB133A

28%

27% 9

20%

26% 21%

LB145B

3.1

21% 1.5

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

4.2

LB133A

7% FY07

LB15DA

29%

FY07

2.8

2.4

LB196A LB196A LB21DA

2.9 3.2

2.8

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

Top 10 GOVT Bond Series : Accounted for 90% of all GOVT bond trading volume in secondary market

Well-Developed Benchmark Bond Pays Off : Even with greater size of issuance, the cost of funding is still at market rate

Unit: % Share of Secondary Trading Volume

Unit: USD Bil.

90% 90%

75%

76%

77%

80%

92%

+0.9 bps +3.2 bps

90%

+1.4 bps

84%

14.7 +1.2 bps

12.8

16.5 15.9 13.7

7.5

-0.2 bps

-0.4 bps

FY07

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

FY08

FY09

FY10

FY11

FY12

FY13

14.6 14.8

-2.7 bps -1.3 bps

FY14

FY15

Tier 1 > 100,000 THB Mil. in Size (82% of Trading Volume)

Total GOVT Bond = 39 Series (End of September 2015) THB Mil.

Tier 2 > 50,000 THB Mil. in Size

Tier 1: >100,000MB

350,000

(17% of Trading Volume)

FY2015 Market Share of Trading Volume in Secondary Market Tier 2 Tier 1

(11 Series)

300,000

82%

17%

Outstanding size (THB Mil.)

250,000

Tier 2: 50,000 – 100,000MB

200,000

(15 Series)

15 150,000

100

New 20 Yr. Benchmark Bond LB366A First Auction Nov 18th, 2015 New 50 Yr. Benchmark Bond LB666A First Auction Nov 25th, 2015

10 30

100,000 100,000

5 50,000

LB383A

LB396A

LB406A

LB183A

LB244A

LB22NA

LB214A

LB19DA

LB171A

LB316A

LB175A

LB267A

LB24DA

LB233A

LB167A

LB198A

LB206A

LB16NA

LB283A

LB191A

LB326A

LB15DA

LB213A

LB193A

LB27DA

LB183B

LB17OA

LB416A

LB446A

ILB217A

ILB283A

LB296A

LB25DA

LB616A

LB236A

LB176A

LBA37DA

LB196A

LB21DA

FY 2016 on-the-run Benchmark Bond GBI-EM Thailand - JPMCB

Source : ThaiBMA

Well-Distributed Bond Maturity Profile

The outstanding size of loan bond maturing in the next 5 years is 1,261,092 THB Mil. (37% of Total GOVT Bond)

(End of September 2015) THB Mil. 350,000

Current Outstanding ≥ THB 100 Bil. Current Outstanding = THB 50-100 Bil. Current Outstanding ≤ THB 50 Bil. FY 2016 on-the-run Benchmark Bond

300,000

GBI-EM Thailand - JPMCB

20 250,000

New 20 Yr. Benchmark Bond LB366A First Auction Nov 18th, 2015 New 50 Yr. Benchmark Bond LB666A First Auction Nov25th, 2015

200,000

15 150,000

10 30

100,000 100,000

5 50,000

Source : ThaiBMA

6 – 10 years

11 – 50 years

LB616A

LBA37DA LB383A LB396A LB406A LB416A LB446A

LB25DA LB267A LB27DA ILB283A LB283A LB296A LB316A LB326A

TTM

LB213A LB214A ILB217A LB21DA LB22NA LB233A LB236A LB244A LB24DA

LB15DA LB167A LB16NA LB171A LB175A LB176A LB17OA LB183A LB183B LB191A LB193A LB196A LB198A LB19DA LB206A

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 September 2015

Turnover Ratio

THB Mil. 350,000

Current Outstanding ≥ THB 100 Bil. Current Outstanding = THB 50-100 Bil. Current Outstanding ≤ THB 50 Bil.

13 GOVT Bond series are included in JPMCB Index 3 of which are on-the-run Benchmark Bond (5-10-15-yr) 300,000

4.0

FY 2016 on-the-run Benchmark Bond

3.9

GBI-EM Thailand - JPMCB Turnover Ratio (time)

3.3

250,000

4.5

3.1

3.5

New 20 Yr. Benchmark Bond LB366A First Auction Nov 18th, 2015 New 50 Yr. Benchmark Bond LB666A First Auction Nov 25th, 2015

3.0

2.7

200,000

2.5

2.5 2.1

150,000

1.9

2.0 1.9

1.5

100,000 100,000 1.0 0.9 0.7

0.5

0.1 0.1 0.1 0.1 0.1

LB416A

LB396A

LB383A

LB326A

LB316A

LB283A

LB267A

LB244A

LB24DA

LB214A

LB22NA

LB213A

LB198A

LB19DA

0.0

LB183A

LB167A

LBA37DA

LB27DA

LB16NA

ILB283A

LB446A

LB17OA

LB183B

ILB217A

LB193A

LB296A

LB236A

LB191A

LB25DA

LB206A

LB176A

LB21DA

LB196A

LB15DA

LB171A

0.3 0.2 0.2

LB616A

0.4

LB175A

0.5 0.5 0.5 0.4

LB233A

0.6

LB406A

50,000

30 Turnover Ratio 0.1 – 2.0

Nearly No Trading

Source : ThaiBMA

ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LI NKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIP LINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC D EBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PD DF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT B OND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKETDEVELOPM ENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLATIO N-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DI SCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBI LC DEBT MANAGEMENT OFFICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE NCHMARK BOND FISCAL DISCIPLINE COMMITMENT BOND MARKET DEVELOP MENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION INFLAT ION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FISCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVE LOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATION IN FLATION-LINKED-BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BOND FI SCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OFFICE INNOVATIO N INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BENCHMARK BON D FISCAL DISCIPLINE COMMITMENT 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 COMMITMENT BOND MARKET DEVELOPMENT ACHIEVEMENTS PUBILC DEBT MANAGEMENT OF 29 FICE INNOVATION INFLATION-LINKED BOND PIONEER PDDF CGIF DEDICATION BE

Linking CGIF & BAHT BOND to the Development of Bond Market 10,000

Total Outstanding 9,747,040 THB Mil.

CGIF

9,000 8,000 7,000

5,000 4,000

Baht Bond

Inaugural (Noble, Hong Kong)

6,000

BAHT BOND

End of September 2015

(Foreign Issuers Bond) (For Asian Bond CGIF Market Initiative)

THB 2,850 Mil.

0.03%

THB 96,574 Mil.

Updated: In September 2015, Mizuho Bank issued its first baht bond as pilot of ASEAN+3 Multi-Currency Bond Issuance Framework (AMBIF). The issuance was a 3-year tenor at 2.33% interest size in total of 3,000 THB Mil.

3,000 2,000 1,000

Corp Bond

24%

SOEs Bond

2013 2014 2015 2016 2017 2018 2019 2020

111111 Natural Hedging

BOT Bond

Inv’t Grade

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

KEXIM

29%

(THB 27,000 M) CABEI (THB 4,474 M)

Lao PDR

Targeted Industry

GOVT Bond

(THB 21,590 M)

38%

Why now?

What next?  Broadening Issuer Base : AEC  Becoming bond market leader of the region

 Entering ASEAN Economic Community (AEC)

(PDDF.)

2015 - 2025

Baht Bond’s Maturity Profile

96,574 THB Mil.

CLMV

THB Mil.

30,000

(Classified by Issuers)

28,090 THB Mil.

Non-Gov’t

% (6,500 Government

24%

23%

(23,066)

NOBLE

Mizuho

(22,409) 20,000

23%

International

Credit Rating

(21,590 THB Mil.)

Baht

& CGIF

70%

Size : 3,000 THB Mil. Issue: Sept 28th, 2015

AFD

IFIs ,

)

THB Mil.

(68,484

)

THB Mil.

CBA KEXIM

ING

10,000

8% (8,100)

10% KEXIM

Lao PDR (Gov’t)

ADB 2015

Today

2016

CITI CABEI Lao PDR

Woori

Hana

Lao PDR

Woori EDL-Gen

(Gov’t)

Lao PDR

2018

2019

Woori

Lao PDR (Gov’t)

8% 6% CABEI KEXIM EDL-Gen (Gov’t)

2020

(8,000) KEXIM

(5,701)

Lao PDR

(Gov’t)

2017

KEXIM

(6,330)

(5,668) Woori

CA-CIB

IBK

(10,000)

CABEI

2021

(2,800)

(3,000)

KEXIM

EDL-Gen

2023

2024

(1,500) KEXIM

2022

Lao PDR (Gov’t)

Year

2025

Source : PDMO (at the end of September 2015)

2007 - 2015

Growth of Corporate Bond Outstanding has Accelerated Total Outstanding 9,747,040 THB Mil.

Baht Bond Outstanding Corporate Bond Outstanding

(at the end of September 2015)

% Share of Corporate Bond Outstanding to Bond Market Capitalization % Share of Baht Bond Outstanding to Bond Market Capitalization

Baht Bond

(For Asian Bond CGIF Market Initiative)

25%

18%

20%

Corp Bond

96,574 THB Mil.

96,574 THB Mil

0.03%

24%

2,325,919 THB Mil

2,325,919 THB Mil.

SOEs Bond 748,778 THB Mil.

15%

BOT Bond

29%

2,862,244 THB Mil.

10%

GOVT Bond

1.3%

0.6%

38%

3,713,525 THB Mil.

0% 2007

2008

2009

2010

2011

2012

2013

2014

22-Sep-15 End of Sept 15

Source : ThaiBMA (at the end of September 2015)

Corporate Bond & Baht Bond Outstanding (Classified by TTMs)

Average size per issuance:

2,166 THB Mil. % Share of total Corporate bond outstanding

THB Mil. 1,000,000

50%

Total Outstanding :

39% 825,638

2,096,911 Number of Corporate Bond + Baht Bond: 968 Average size per issuance:

2,166

THB Mil.

(Series) THB Mil.

Baht Bond Corporate Bond

25%

500,000

14% 302,617

15%

310,250

304,222

13%

280,699

4% 73,485 TTM 0 (Years)

1-3

Source : ThaiBMA (at the end of September 2015)

4-5

6-7

8 - 10

11 - 100

Remark : Excluded Commercial Papers (less than 1 year at issue)

Corporate Bond & Baht Bond Outstanding (Classified by Size) THB Mil. 200,000

Corporate Bond

Outstanding (THB Mil.)

28%

are 4 Major Corporates No. of Issuers

A Rated Group (AAA, AA, A)

PTT CPALL SCC

B Rated Group (BBB, BB)

≥ 50,001

28%

10,001 – 50,000

57%

≤ 10,000

120

15%

Total

177

100%

Unrated

Baht Bond

% Share of Outstanding

150,000 Baht Bond

Lao PDR (Gov’t)

BahtLaoBond PDR (EDL-Gen)

100,000

Lao PDR (Gov’t) (BBB+) 21,590 THB Mil.

50,000 50,000

Lao PDR (EDL-Gen) (BBB+) 6,500 THB Mil.

10,000 0

Issuer 1

Issuer 177

Source : ThaiBMA (at the end of September 2015)

Remark : Excluded Commercial Papers (less than 1 year at issue)

Corporate Bond & Baht Bond Outstanding (Classified by Size) THB Mil. 200,000

Corporate Bond

Outstanding (THB Mil.)

28%

are 4 Major Corporates No. of Issuers

A Rated Group (AAA, AA, A)

PTT CPALL SCC

B Rated Group (BBB, BB)

≥ 50,001

28%

10,001 – 50,000

57%

≤ 10,000

120

15%

Total

177

100%

Unrated

Baht Bond

% Share of Outstanding

150,000 Baht Bond Lao PDR (Gov’t)

BahtLaoBond PDR (EDL-Gen)

100,000

Lao PDR (Gov’t) (BBB+) 21,590 THB Mil.

50,000 50,000

Lao PDR (EDL-Gen) (BBB+) 6,500 THB Mil.

10,000 0

Issuer 1 Source : ThaiBMA (at the end of September 2015)

Issuer 177 Remark : Excluded Commercial Papers (less than 1 year at issue)

Annual Capital Flow classified by GOVT & BOT Bond (2007 â&#x20AC;&#x201C; 2015)

-96,030 THB mil. (2015YTD)

THB Mil.

350,000

300,000 250,000

+93,249

200,000

-96,030 THB mil

+84,003

150,000

+23,052

100,000

+196,463 +129,454

50,000

-50,000

+30,216 -22,494

-2,793

+117,144

GOVT Bond

+96,738

-52,262 THB mil. +29,642

-1,598 -7,506

-53,807

-27,157

-100,506

-100,000

BOT Bond

-150,000 2007

2008

2009

2010

2011

2012

2013

2014

-43,768 THB mil. 2015 YTD

Non-resident Net Buy/Sell in BOT Bond Non-resident Net Buy/Sell in GOVT Bond

2015 Weekly (The past 38 weeks) THB Mil. 125,000

100,000

End of Sep 2015

Net Change in Non-resident Holding (YTD) BOT Bond vs GOVT Bond

Accumulative NR Holding = -96,030 THB mil.

75,000

50,000

25,000

BOT Bond

-25,000

-43,768 THB mil. -50,000

GOVT Bond

-52,262 THB mil.

-75,000

-100,000

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

-125,000

End of Sep 2015

As o

2015

Non-Resident Holding in THB Bond = 587,197 THB Mil.

Outstanding

Thai Bond Market Cap. =9,747,040 THB Mil.

Baht Bond

(Foreign Issuers Bond)

CGIF Market Initiative) 0.03% (For Asian Bond

GOVT Bond GOVT Bond

574,063 573,222

BOT Bond Bond BOT

118,177 13,212

SOE Bond Bond SOE

Corp Bond Corp Bond

587,197

GOVT Bond Outstanding

BOT Bond Outstanding

3,713,525THB Mil.

2,862,244

THB Mil.

Non-Resident 13,212 THB Mil.

Non-Resident 573,222THB Mil.

BOT Bond

7.53% % 6.02

692,906

24%

SOEs Bond

6.24% 5.88% 1.390% 1.28% 0.13% 1.28 0.00% 0.01 0.01% 0.01%

763 666

TOTAL TOTAL

Corp Bond

% 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

29%

2,862,244 THB Mil. GOVT Bond

Domestic Investors

38%

2,849,032 THB Mil.

3,140,303 THB Mil.

99.5

84.6

3,713,525 THB Mil.

End of Sep 2015

Peers Comparison

Non-Resident Holding in Thai GOVT Bond is 573,222 THB mil. or 15.4% of Total GOVT Bond Outstanding

Percentage share of Non-resident Holding in Local Government Bond (Mar 2008 - Present)

40%

Indonesia

39.63% Jun’ 15

Malaysia 31.38%

30%

Mar’ 15

Peak @ 19.1% (Apr’ 13)

Thailand

15.4%

20%

end of Sep 2015

Korea 10.9% Mar’15

10%

Japan 9.08% Mar’ 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

2008

2009

Source : AsianBondsOnline, ThaiBMA

2010

2011

2012

2013

2014

2015 End of Sep 2015

Mission

Transparency, Discipline, Trustworthiness, Driving Social and Economic Development

Values

Professional in public debt management for sustainable development

Vision

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

Source: Public Sector Development Group, PDMO

Nantachod Samarnwong

Economist

Sittan Sathianphattanakool

Economist

Nattakarn Boonsri, Director

Government Bond Market Development Division

Nattakarn Boonsri, Acting Senior Expert

Executive Director

Pimpen Ladpli

Phimonphan Tanwattana

Economist

Wanthanee Phongam

Economist

Paroche Hutachareon, Director

Fund Management and Bond Market Infrastructure Development Division

Sunee Eksomtramate Executive Director

Executive Director

Teeralak Sangsnit

Bond Market Development Bureau

Acting Executive Director

Jindarat Viriyataveekul

Public Infrastructure Project Management and Evaluation Bureau

Phacharaporn Khotnarin

Economist

Nakarin Prompat, Acting Director

International Bond Market Policy Division

Executive Director

Jindarat Viriyataveekul

Public Infrastructure Project Financing Bureau

Sirasa Kanpittaya

Theeraj Athanavanich

Policy and Planning Bureau

Deputy Director-General

Suwit Rojanavanich

Director-General

Deputy Director-General

Debt Management Bureau 2

Senior Expert on Bond Market Development

Debt Management Bureau 1

Wisut Chanmanee Bond Market Advisor

Bond Market Advisor

Front Office Middle Office Back Office Support Office

Ekaraj Khuankhunsathid Secretary

Office of the Secretary

Chanikarn Chaiyasena

Economist

Sophida Sritomya, Director

Financial Product Development Division

Payment Administration Bureau

Risk Management Group

Information Technology Center

Legal Advisory Group

Public Sector Development Group

Internal Audit Group

Ace Viboolcharern Public Debt Advisor

Public Debt Advisor

For Further Information : Pimpen Ladpli

pimpen@pdmo.go.th

Executive Director of Bond Market Development Bureau

Nattakarn Boonsri

nattakarn@pdmo.go.th

Director of Government Bond Market Development Division Acting Senior Expert on Bond Market Development

Sophida Sritomya

sophida@pdmo.go.th

Director of Financial Product Development Division

Paroche Hutachareon

paroche@pdmo.go.th

Director of Fund Management and Bond Market Infrastructure Development Division

Nakarin Prompat

nakarin@pdmo.go.th

Acting Director of International Bond Market Policy Division