Thailand's new bankruptcy court sent out an encouraging message to
international lenders in March when it declared the country's
largest debt defaulter insolvent in a benchmark case that paved the
way for its restructuring.
Thai Petrochemical Industry (TPI) owes $3.5 billion to lenders
including Bangkok Bank, Citibank, the IFC, US Export-Import Bank
and Bank of America. Led by its chief executive, Prachai
Leopairatana, it argued its assets still exceeded its liabilities,
and that Prachai should be allowed to remain in control of the
company. In a move widely praised by creditors and analysts, the
court took a wider view of insolvency, rejecting the company's
asset valuations and focusing on its inability to service its
borrowings since the 1997 baht devaluation.
"It is a landmark which defines how the court will use its
latitude in determining insolvency and...
