ADB issues debut Thai baht bonds.

MANILA, May 18 Kyodo

The Asian Development Bank announced Wednesday it has issued its debut Thai baht bonds in the domestic capital market of Thailand with a principal amount of 4 billion baht (about $100 million) and a bullet maturity of five years.

The Manila-based bank said the lead arrangers of the issue were Citigroup and Siam Commercial Bank.

It also said that the issue represents the ADB's third market-opening transaction in the region in just over a year, following bond issues in India and Malaysia in February and November 2004, respectively.

Priced at par, the ADB's baht bonds carry a semiannual coupon of 3.87 percent per annum and were priced at a spread of 17 basis points over the five-year Thai government security. Before launching the issue, the ADB and the lead arrangers conducted an extensive road show in Bangkok to present the deal to key institutional investors.

''Offered through a book building process, the issue generated strong demand and was nearly twice oversubscribed. The issue was broadly distributed to institutional investors, including banks, pension funds, and asset managers,'' the bank said.

''After the ADB's market-opening transactions in India and Malaysia last year, the Thai baht bond issue represents another milestone in the ADB's quest to develop regional bond markets,'' ADB Vice President Khempheng Pholsena said.

She said the bond issue also underscores the ADB's confidence in the Thai capital market. ''This, together with the new standards created through this issue in terms of regulatory framework and documentation, will facilitate issuance by other international borrowers in Thailand,'' she said.

Moreover, she said the issue will help attract international investors to the Thai bond market as well as enhance liquidity in the cross-currency swap market.