Thai Airways International (THAI) is gearing up to exit its rehabilitation scheme by mid-2025, with major banks such as Bangkok Bank (BBL) and Krungthai Bank (KTB) set to benefit. The airline’s exit plan offers creditors multiple repayment options, boosting confidence in the financial sector.
Thai Airways’ Rehabilitation Exit Timeline
Positive Shareholder Equity Anticipated by Early 2024
Thai Airways has submitted reports to the Stock Exchange of Thailand (SET) and the Securities and Exchange Commission (SEC), indicating that it expects to achieve positive shareholder equity by February 2024. Following this, the airline is preparing to exit its rehabilitation plan by April 2025.
Central Bankruptcy Court Approval Expected in May
Approval from the Central Bankruptcy Court for THAI’s exit is anticipated in May 2025. Following this, Thai Airways shares could resume trading on the SET by June 2025, signaling the company’s recovery and return to regular business operations.
Impact on Major Creditors: BBL and KTB
Debt Repayment Plans for Financial Institutions
Bangkok Bank (BBL) and Krungthai Bank (KTB) are among the major creditors expected to benefit from the airline’s rehabilitation exit. According to Chalie Kueyen, a banking analyst at KGI Securities (Thailand), these two banks hold around 31 billion baht in unsecured debt as part of a larger debt group amounting to 404 billion baht.
Debt Servicing and Conversion Options
The banks, along with other creditors, are being offered several options for debt repayment. This includes a mandatory and voluntary debt-to-equity conversion at a rate of 2.54 baht per share, or an extension of the repayment period by up to 15 years with an interest rate of 1.5%. The debt to banks has been serviced regularly since THAI’s rehabilitation plan began in 2020, ensuring financial stability for the creditors.
What This Means for Thai Airways and Its Creditors
A Bright Future for THAI and Banking Sector
Thai Airways’ exit from the rehabilitation scheme is expected to bring financial relief to its creditors, particularly BBL and KTB. Both banks are well-prepared, having made provisions for the airline’s debts since the restructuring began. The successful exit will not only bolster the airline’s recovery but also strengthen the financial position of its creditors.
Key Milestone for Thailand’s Aviation Industry
The airline’s return to the SET and completion of its rehabilitation marks a significant milestone for Thailand’s aviation industry. The gradual recovery of THAI from its financial struggles highlights the effectiveness of the rehabilitation plan and the resilience of the country’s economy.
