Bangkok Bank says has $101 mln exposure to Lehman

By Arada Therdthammakun

BANGKOK, Sept 16 (Reuters) - Bangkok Bank BBL.BK, Thailand's top lender, said on Tuesday it held 3.5 billion baht ($101 million) in senior, unsecured bonds issued by Lehman Brothers (LEH.N: Quote, Profile, Research, Stock Buzz), which has filed for bankruptcy protection.

Other leading Thai banks, including second-ranked Krung Thai Bank KTB.BK and number five Bank of Ayudhya BAY.BK, said they had limited, indirect investments in Lehman Brothers through collateralised debt obligations (CDOs).

Bangkok Bank's executive vice president, Kulathida Sivayathorn, told Reuters: "The exposure might affect our profits in a quarter, but not enough for us to show a loss as we still have profits from operations."

"We expect to receive some repayment, but don't know how much," Kulathida said, adding this was its total exposure to Lehman.

The stock market's banking subindex .SETB slumped to its lowest level since November 2004 in early trade on Tuesday, led by a 7.3 percent fall in Bangkok Bank to 102 baht.

"Lehman's downfall is bad for local banks, though the total amount (of exposure) is relatively small," Kim Eng Securities said in a research note. "Losses on debentures are unclear while the loss on forex should be limited to 100 million baht."

The central bank has said the overall impact would be limited as Thailand's 14 commercial banks had only 4.3 billion baht of direct exposure to Lehman and another 5.3 billion of foreign exchange contracts.

State-run Krung Thai Bank KTB.BK, Thailand's second-largest lender, said only 1 percent of its $160 million invested in CDOs related to Lehman Brothers.

"Nothing to worry about on our CDO portfolio. There is only 1 percent of our CDOs linked to Lehman's securities and we already have provisions to cover an impairment loss for them," President Apisak Tantivorawong told Reuters.

Bank of Ayudhya, Thailand's fifth-biggest bank, said it had indirect investments in Lehman Brothers through investments in $85 million of CDOs, but that an insignificant portion was linked with Lehman.

"The bank has no direct transactions with Lehman but has indirect investment through CDOs," Yaowalak Poolthong, head of corporate communications and investor relations, told Reuters.

President Kannikar Chalitaporn, president of number three lender Siam Commercial Bank SCB.BK, said it had sold some securities linked to Lehman and would book a small loss on the investment in the third quarter. She gave no figures.

Siam Commercial shares dropped 4.14 percent to 69.50 baht, having hit their lowest level in 15 months at 68 baht in early trade.

At 0841 GMT, shares in Krung Thai Bank had dropped 2.8 percent, Bank of Ayudhya was down 5.26 percent, while Kasikornbank KBAN.BK, the country's fourth largest, was down 2.3 percent although it said it had no exposure to Lehman. ($1=34.56 Baht) (Additional reporting by Manunphattr Dhanananphorn; Editing by Alan Raybould)