The deal comprises four tranches: a triple-A (tha) rated class A-1 Bt1.5 billion ($37 million) three year tranche; a triple-A (tha) rated class A-2 Bt500 million ($12.3 million) five year tranche; a double-A (tha) rated class B Bt120 million ($3 million) five-year tranche and a single-A (tha) rated class C Bt160 million($4 million) five year tranche.
The class A-1 deal priced at par on a coupon of 5.73%, or 75bp over three-year government bonds. The class A-2 has a coupon of 5.88% or 70bp over five-year government bonds. The subordinated tranches priced with coupons of 6.13% and 6.33%, respectively.
The expected maturity date for the class-A shares is March 2009, with legal maturity date of April 2011 and a soft bullet repayment. Expected maturity for the class-A2 notes, which also carry a soft bullet repayment, is March 2011, with legal maturity at April 2013. Legal maturity for the class-B and class-C pass-through notes is April 2013.
The final book was two times oversubscribed, with asset managers, insurance companies, pension funds, and financial institutions buying into the deal.
The notes are backed by a pool of active credit card receivables worth up to Bt2.8 billion ($71 million) issued under ThailandÆs securitization law. Aeon has a total of 491,809 eligible accounts totaling Bt5.3 billion ($134 million).
Credit enhancement for the class A-1 and A-2 notes is provided by the subordinated loan and the class-B and class-C notes with an initial subordination level of 24.5% of the total of the debentures and the subordinated loan.
The class-B notes carry a credit enhancement provided by the subordinated loan and the class-C notes with an initial subordination level of 20%.
For the class C notes, credit enhancement is provided by the subordinated loan with an initial subordination level of 14%.
AEON is a Thai consumer finance operator, which carries a national long and short-term rating A- (tha)Æ and F2(tha), respectively, but is currently on negative outlook.