DUBAI, June 3 — State-owned Islamic Bank of Thailand plans to increase its capital by 7.11 billion baht (RM723 million) and issue a 5 billion baht sukuk, the country’s first-ever Islamic bond, the bank said today.
The bank said it hoped this strategy would help it to return to profit this year and help the country’s Islamic financial sector grow after tax legislation necessary for its expansion was passed in May 2011.
Under the plan, the bank said it would raise 927 million baht in capital this month and 6.2 billion baht in the fourth quarter.
The bank said it would issue the 5-billion-baht subordinated sukuk to increase its capital ratio.
Last year, bank officials said the sukuk would have a likely maturity of 5 years and the bank would appoint Malaysia’s CIMB Bank to handle the deal, targeting domestic and institutional investors in Malaysia and Hong Kong.
The bank, rated BBB- by Fitch, also said it would seek investors to establish a presence in the Middle East in the next three years, while increasing its domestic network of branches to 130 from 106 now.
Islamic Bank of Thailand was set up in 2003 as a state enterprise under the Ministry of Finance and has turned buses into branches to reach customers. – Reuters