Attempts to clear the debts incurred by the rice-pledging scheme continued on Monday with the launch of 100-billion-baht bonds by the Finance Ministry and the Bank for Agriculture and Agricultural Cooperative (BAAC).
Finance Minister Sommai Phasee (centre) signs a memorandum of understanding with bank executives to launch the 'Happy Together' bond at the Finance Ministry on Monday. (Finance Ministry photo)
The two tranches, collectively called the ''Happy Together'' savings bonds, were introduced on Monday in an agreement signed between the ministry and the bank.
Finance Minister Sommai Phasee said during the launch that the bonds were in line with a policy to promote savings among the public as they targeted retail investors. But the ministry's statement said the proceeds would ''refinance debts'' for the government.
Post Today on Monday quoted Mr Sommai as saying the bonds would be used to repay the rice-pledging programme's debts owed to the bank.
The debts incurred from the rice-pledging scheme of the Pheu Thai government alone were around 600 billion baht.
The 50-billion-baht lot, issued by the Finance Ministry, has a 10-year maturity. It carries progressive interest rates — 3% in the first three years, 4% in the 4th to 7th years and 5% in the 8th to 10th years.
The other 50-billion-baht tranche, issued by the BAAC, has a five-year maturity with a fixed interest rate at 3.8%.
Both lots, to be guaranteed by the Finance Ministry, set the minimum purchase at 1,000 baht and the maximum at 2 million baht. Bangkok Bank, Krungthai Bank, Kasikornbank and Siam Commercial Bank are the underwriters.
They can be bought at the BAAC's branches, in addition to those of the four underwriting banks, during Jan 12-23.
Last November, the BAAC launched a 50-billion-baht bond for the same propose and it was snapped up by non-bank groups and mutual fund companies.