The Japan Bank for International Cooperation (JBIC) has signed a loan agreement of up to 262.289 million baht with Summit Keylex (Thailand) Co., Ltd., or SKT, the Thai subsidiary of a Hiroshima-based auto-parts maker. JBIC said the loan is co-financed with Sumitomo Mitsui Banking Corporation, and that total co-financing comes to 722.322 million baht.
What the money is for
The loan is denominated in Thai baht, not yen or dollars. It funds SKT's auto-parts manufacturing and sales business in Chonburi province, central Thailand, and is earmarked for equipment procurement and facility expansion. The release does not give the loan's interest rate or tenor.
The borrower
The parent is a small and mid-sized company that makes auto body parts and vehicle components. It set up SKT in 2013 and began production in Thailand that year. JBIC says the company is building a stable supply system for high-quality parts in a country where many parts makers have plants, against a backdrop of rising Asian vehicle demand. The release describes the new loan as following earlier JBIC support for the same company, announced in a press release dated 13 December 2019.
JBIC's stated rationale
JBIC says local-currency lending supports the company's overseas expansion, helps maintain and improve the international competitiveness of Japanese industry, and contributes to supply-chain resilience for Japanese companies in Thailand. Those are the bank's own policy claims. The release gives no figures behind them.