Bangkok, 8 November 2017 ? In the continued effort to develop the bond market, the SEC is revising the relevant rules and regulations to better respond to the changing market conditions and investors? demands. This is to ensure that debt securities will continue to be a key product of choice for fund mobilization, while investors are better protected. 

Assistant Secretary?General Charuphan Intararoong said: ?The bond market is one of the three pillars of the Thai economy apart from equity and commercial banking industries. During the past two decades, the bond market has experienced significant growth on a continuous basis, leaping from 12 percent to 75 percent of the gross domestic product. As of 30 September 2017, the total outstanding balance of private sectors? debt securities was 3.78 trillion baht. Of this amount, debentures accounted for 92 percent, and bills of exchange covered 8 percent. 

?In developing the bond market, the SEC emphasizes striking the right balance by providing the business sectors convenience for issuing debt securities for fund mobilization while putting in place an appropriate mechanism for investor protection as debt securities is indeed an investment choice. Hence, the level of strictness of the regulations governing the issuance and offer for sale of debt securities varies depending on the types of investors. For example, the regulations on a private placement to institutional and high net worth investors and an offering to a limited number of specific investors are more relaxed than those governing a general public offering.?

However, recently there have been some cases where debt issuers have used the channel for offering to a limited number of investors for the wrong purpose by extending such offer to high net worth investors who knew little information on the issuer. Besides, investors were prone to searching for yields while securities companies and commercial banks acting as an intermediary for offering of such debt securities provided insufficient information for investors? decision-making, causing investors to overlook investment risks.

The SEC is therefore in the process of amending the relevant rules and regulations to be more suitable for the industry environment while also increasing measures for protecting investors. For example, the offering of bills of exchange will be limited to a certain number of investors, and a representative of debenture holders will be required in case of offering long-term debentures to high net worth investors. The issuer's ability to comply with the repayment terms must be disclosed more clearly as well.     

?We conducted a public hearing on the principles for this matter in last August. Another hearing on the draft rules will follow within this month,? Mrs. Charuphan added. 

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