Bangkok, April 17, 2014 ? The SEC requires disclosure of foreign bank branches as issuers of debt securities to focus on information of branches. Meanwhile, both credit ratings of the banks and the issuing branches must be provided to better reflect credit risk.

SEC Secretary-General Vorapol Socatiyanurak revealed that the Capital Market Supervisory Board recently approved revision of regulations on debt securities issuance and offering and disclosure of foreign bank branches. Disclosure made in registration statement and post-offering periodic reports, such as financial statement and annual registration statement (if any), must emphasize on information of the issuing branches, either short-term or long-term debt securities, to better reflect credit risk.

Also, to ensure adequate information for investment decision making, summarized business information and key financial conditions of the foreign banks as well as legal issues are required; for example, debt securities holders may not be able to request for repayment from assets of the foreign banks; or the foreign banks may draw profit or capital from their branches.    

In addition, the issuing branches are required to furnish and disclose credit ratings of both the branches and the foreign banks. For issuances of short-term debt securities by the branches with sound financial condition and a minimum of specified capital requirement, however, rating of  foreign banks only is acceptable. In any case, moreover, clear statement on legal issues must be included for investment decision making.

?In case that the foreign bank branches offer for sale of debt securities, investors will be more exposed to credit risk of the branches than that of the foreign banks due to limitations of  law on bankruptcy. Thus, the SEC revises disclosure of the foreign bank branches offering the debt securities to provide investors with more complete information that reflects investment risk and allow them to make sound investment decision,? said Vorapol.