DNVPrivate± Mixed
relevance
Public Debt Management Office issues second SLB with bookings surging 2.8 times, raising the size to 25 billion baht at 2.86% interest
MacroCorporate Action
The Public Debt Management Office has successfully completed a demand survey for the issuance of the Thai government's second sustainability-linked bond, SLB425A, with total subscription bids reaching 42.064 billion baht, or 2.80 times the announced offering size of 15 billion baht. Jindarat Viriyataveekul, Director-General of the Public Debt Management Office, disclosed that given the high level of investment demand, it decided to increase the allocation to 25 billion baht at an interest rate of 2.86% per year, with the bonds scheduled for issuance on September 17, 2026, to fund the fiscal 2026 budget deficit. The success came amid volatile financial market conditions driven by geopolitical tensions and concerns over inflationary pressures, yet the issue still drew strong support from leading institutional investors, including financial institutions, pension funds, mutual funds, and foreign investors. SLB425A is the first Thai government bond linked to biodiversity conservation and climate indicators, covering a target of limiting net greenhouse gas emissions to no more than 152 million tonnes of carbon dioxide equivalent by 2035 and a target of expanding biodiversity conservation areas to at least 30% of land and water areas by 2030. It includes an interest rate adjustment mechanism linked to the assessment of target achievement at a rate of 2.5 basis points per KPI, and the fundraising framework was assessed by DNV (Thailand) as an independent external reviewer. Next, the Public Debt Management Office plans to develop SLB425A into a 15-year benchmark bond and will continue to issue additional tranches of the existing bond series.