News from 2019-09-11 / DEG
DEG and IFC agreed to subscribe to a bond to be issued by Bank of Ayudhya
More than half of the SMEs in Thailand, and especially those owned by women, lack adequate access to finance. The finance gap for women-led small and medium-sized enterprises (WSME) in the country is estimated to be USD 25 billion, accounting for 61 per cent of the overall MSME finance gap in Thailand. Monika Beck, member of the Management Board of DEG, alongside the CEO of IFC, Philippe Le Houérou, have now signed agreements to subscribe to the Women Entrepreneurs Bond to be issued by Bank of Ayudhya, locally known as Krungsri. This inaugural certified social bond issuance will help expand credit lines to WSME — an important sector that drives economic growth and employment.
First private-sector "gender" bond issuance in the Asia Pacific region
This bond will be the first private-sector "gender" bond issuance in the Asia Pacific region and the first social bond issuance in Asian emerging markets in compliance with the International Capital Markets Association Social Bond Principles and the ASEAN Social Bond Standards. As such, Krungsri’s Women Entrepreneurs Bonds will introduce WSME loans as an attractive asset class for investors. At the same time it will pave the way for issuance of future capital markets instruments that benefit socially-responsible initiatives in Thailand and the region.
Seiichiro Akita, Krungsri's President and CEO, said: "Krungsri holds strong to our conviction in continuing to grow our business, while fulfilling the broader goal of financial inclusion for the underserved, including the WSME segment. This issuance reaffirms our commitment to corporate citizenship practices and our broader ambition to meet the UN Sustainable Development Goals."
IFC’s and DEG’s subscriptions will be up to USD 150 million and USD 70 million, respectively.
Bank of Ayudhya, one of Thailand’s largest universal banks and a leader in retail and SME banking, expects to issue the bonds to IFC and DEG in October.