Fitch converts SCB Asset Management's AMR to 'Highest Standards (tha)'

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According to a release, Fitch Ratings (Thailand) has converted Thailand-based SCB Asset Management Co., Ltd.'s (SCBAM) National Asset Manager Rating (AMR) to 'Highest Standards (tha)' under its new rating scale from 'M2+(tha)', following an update of its criteria for Asset Manager ratings. 

The Outlook is Stable.

Fitch has updated its rating criteria, rating scale and definitions for Asset Manager ratings. Asset Manager ratings are now assigned on a descriptive scale based on Fitch's assessment of the manager's investment and operational platform.

Asset Managers are rated 'Good Standards', 'High Standards' and 'Highest Standards', relative to the standards applied by institutional investors in international markets (or domestic market standards for National Scale ratings).

Key Rating Drivers

SCBAM's rating recognises the company's established history of fund management, its strong domestic market position and support from its single shareholder - Siam Commercial Bank Public Company Limited (SCB, AA(tha)/Stable/F1+(tha)). SCBAM also benefits from its parent's distribution capacity and extensive resources in risk management, compliance and IT.

The rating also takes into account SCBAM's experienced senior management and investment staff, although their tenure with the company has been brief and staff turnover in equity investment management has been high.

The rating is further supported by a solid control framework, formalised investment process, and increased automation in middle and back office functions after IT upgrades.

The main challenges facing SCBAM are growing its market share and assets under management (AuM) amid intensifying competition. There is also scope for stabilising staff turnover in equity investment and improving the performance of its equity funds.

Other challenges include continued upgrade of the IT platform without delay or operational disruption.