Bangkok--Jul 16--IFCT Mr. Apisak Tantivorawong, President of IFCT Finance and Securities Public Company Limited (IFCTF) announced the launch of "IFCT Reference Bonds Program" to serve the purpose of establishing a benchmark rate for the local bond market, The bonds to be issued under the program comprise the Industrial Finance Corporation of Thailand (IFCT) bonds of medium-to- long maturity ranging from 3-7 years with total value of Baht 3,000 million. The issues will be traded in the local Bond Dealers Club starting on Wednesday July 17, 1996 having IFCTF as the underwriter and companies within the IFCT group as market makers. Despite its considerable growth during the past 3-4 years, the Thai bond market is still relatively small compared to the equity market the capitalization of which is about nine times greater. Following the pattern evolved in developed countrics, however, the local bond market size is expected to eventually match or outgrow the equity market if the govermment is persistent with its policy of market development and assists in tackling problems encountered by the market. To support the government in such matters concerning development of the country's capital market which is originally the mission giving rise to the establishment of IFCT, IFCT and IFCTF have jointly developed an instrument to provide a benchmark interest rate under the "IFCT Reference Bonds Program" with an aim to overcome the benchmark rate shortage problem which has become a major hindrance in the development path of the Thai bond market. Mr. Apisak pointed out that IFCT bonds can suitably serve in the development of benchmark rate due to its comparable characteristics to government instruments: it carries credit rating equivalent to the country's rating and has considerable volume circulating in the market constituting approximately 30% of the total private bond value issued each year. Besides, the bonds are launched with variety in terms of maturity ranging from short, medium to long term with the longes maturity of 18 years. Issuance will be made at regular intervals. Currently, IFCT bonds cannot yet fulfill its role in benchmark establishment due to its scarce liquidity in the secondary market as all issues are mostly purchased for safekeeping to satisfy financial institutions' reserves requirement. Hence, to provide for adequate liquidity in the secondary market which will enable the bonds to truly reflect the prevailing market interest rates, bond issuance under this program is designed to be carried out in considerable issue size, with consistency and continuity while the number of issues will be controlled to avoid confusing redundancy. Besides, market makers for the bonds have also been officially appointed. The program consists of IFCT bond of three-year, five-year and seven-year maturity with aggregate value of Baht 3,000 million carrying interest rates of 8.875%, 9.00% and 9.25% respectively, payable semiannually. The issuance was made on June 27, 1996 with IFCTF acting as the underwriter. The bonds will be traded in the Bond Dealers Club starting on July 17, 1996 having IFCTF as well as finance and securities companies within the IFCT group serving as market makers. Transaction prices will be made available for local and foreign investors daily after close of BDC's office hours via leading computer information networks, e.g. BISNEWS, REUTERS and BLOOMBERG as well as in newspapers including Krungthep Thurakij, the Nation and other interested publications. Mr. Apisak further stated that IFCT bonds under the program are expected to be very well received by local and foreign institutional investors who prefer investing in quality bonds with ample liquidity as a result of active trading in the secondary market. The bonds, which will reflect the market rate, can be further developed into benchmark rate and local bond yield curve in the future. End