BANGKOK. Mar 2: Thailand's bond market Is getting a boost as blue-chip companies seek an alternative to raising funds from banks and the stock market, which remain too weak to fund economic recovery, says

Leading Thai companies, including Siam Cement and the Charoen Pokphand Group, are set to Issue bonds this month, which offer an alternative source for refinancing debts at cheap rates and fresh working capital.

As the recovery began last year, companies were able to rely on spare capacity to increase production, but new financing .will become more Im-portant In 2000. when the economy is forecast io grow by 4.5 per cent, analysts say.

With problem loans still comprising more than one-third of total lending. Thai banks don’t have strong enough capital bases to make fresh

loans at prevailing low rates.

Thailand's depressed stock market, which has dropped by 25 per cent since the beginning of the year, is also still too volatile to offer a funding alternative.

"Blue-chip companies are looking at the (bond) market as an attractive one in which to issue right now," Imoglne Baker, a credit analyst at Barclays Capital in Hong Kong, told Dow Jones Newswires.

At the end of March. Thal land's biggest industrial conglomerate. Slam Cement, plans a 10 billion baht ($263 million) issue of six-year debentures at a 7.75 per cent coupon rate, much cheaper than (he rale at which local banks are willing to lend.

Debentures are debts secured only by the general credit or promise to pay of the Issuer.

Banks won't lend at prevailing low prime rates of around 8 per cent.