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Thailand’s 2020 ESG bond issuance may hit 60 billion baht, double in 2021, report says

ESG bond issuance in the nine months through September was 37 billion baht, already exceeding the 30 billion baht in all of 2019
By Goh Thean Eu   
October 29, 2020

Thailand’s environmental, social and governance (ESG) bond issuances are likely to raise 60 billion baht (US$1.93 billion) this year, two times more than in 2019, and the figure may double again in 2021, according to a report in the Bangkok Post, quoting two senior officials from the Bank of Ayudhya, the country’s fifth biggest lender by assets.

ESG bond issuance in Thailand from January through September was 37 billion baht, already exceeding the 30 billion baht in all of 2019.

“We expect ESG bond issuance to reach 60 billion baht this year,” Prakob Phiencharoen, executive vice president and head of global corporate banking at the Bank of Ayudhya, is quoted as saying in the October 28 report.

According to his colleague Poonsit Wongthawatchai, executive vice president of the ESG division, demand for ESG bonds is “growing drastically” and that “these days, supply levels do not meet the demand”.

“ESG bonds are likely to grow by 100% next year,” he says.

Mr. Poonsit says the bank’s major shareholder, Mitsubishi UFJ Financial Group, specialises in ESG and it will leverage the Japanese company’s strength by providing ESG loan facilities and helping companies to develop ESG bonds.

He says the lender aims to become the “best sustainable bank and a leading bank in ESG in Thailand by 2023”.

“We are also currently preparing ESG guidelines, which include establishing a set of principles for loan approval, and setting a target to reduce greenhouse gas emissions,” he adds.

Spokespersons for Bank of Ayudhya did not immediately respond to questions from Asia Asset Management.

The Bangkok-based bank has 550 branches nationwide and 2.36 trillion baht of assets.