SEC has amended regulations to support Vayupak Fund offerings to the public, promoting savings and investments in the Thai capital market. Cabinet resolution approved sale of Vayupak Fund units to public.
- The Securities and Exchange Commission (SEC) of Thailand has amended regulations to support the offering of the Vayupak Fund to the general public.
- The Ministry of Finance is spearheading the initiative to promote savings and investment among the Thai population.
- CLSA, an investment bank, expects the Vayupak Fund to drive Thailand’s economic growth.
On 13 August 2024, the Cabinet passed a resolution acknowledging the offering for sale of Vayupak Fund to the general public as proposed by the Ministry of Finance. The initiative aims to promote long-term savings and investments among the public and to support the development of the Thai capital market by mobilizing funds into the Stock Exchange of Thailand (SET), which would in turn reduce reliance on foreign investment funds.
Established on July 1, 2003, the Vayupak Fund is a closed-end mutual fund with a size of 100 billion baht. Its primary objective is to manage securities held by the state in order to maximize returns.
Key Information
- Name: Vayupak Fund 1 (VAYU1)
- Management Company: Krung Thai Asset Management (KTAM)
- Capital: 100 billion baht (approximately $2.3 billion)
- Investment Focus: State-owned enterprises (SOEs), state-owned financial institutions, and other liquid assets like government securities, short-term debt, and financial instruments.
- Minimum Return: Guaranteed by the government.
- Subscription Period: September 16-20, 2024
- Unit Price: 10 baht per unit
- Minimum Investment: 10,000 baht
Vayupak Fund plans to issue investment units totaling approximately 100 – 150 billion baht to the general public (referred to as Type A unitholders), and have them listed on the SET. Type A unitholders will receive returns in the form of dividends, within a range not lower than the specified minimum rate and not higher than the maximum rate, throughout the 10-year term. In addition, if the net asset value (NAV) declines, Type A unitholders will have the right to receive returns before Type B unitholders (the Ministry of Finance and government sector investors).
The SEC has therefore amended the relevant regulations for Vayupak Fund, as requested by the Vayupak Fund Office and the responsible asset management company, with the key points as follows:
(1) Allowing the sale price of Type A investment units to be set at par value (10 baht per unit), in addition to sales based on the NAV per unit;
(2) Establishing specific investment limit for Vayupak Fund and extending the exemption period for exceeding the investment limit that does not result from additional investments to 10 years, starting from the first trading day of Type A units on the SET; and
(3) Allowing the Ministry of Finance to make payments for the purchase of investment units in the form of securities or other assets (pay-in-kind).
The Notifications related to the amendments to the Vayupak Fund regulations have taken effect since 5 September 2024.
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Remark:
The two relevant Notifications are:
(1) Notification of the Capital Market Supervisory Market No. Tor Nor. 27/2024 Re: Investment of Funds (No. 28), dated 5 September 2024.
(2) Notification of the Capital Market Supervisory Board No. Tor Nor. 28/2024 Re: Rules for Management of Vayupak Fund (No. 3), dated 5 September 2024.
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