Implementing a Modified Escalator Forward demonstrates a strategic approach to risk management. It showcases the company’s commitment to using advanced financial instruments to manage FX exposure effectively. This proactive stance can enhance the company’s reputation among investors, stakeholders and financial analysts, as it reflects a high level of financial sophistication and risk awareness.

The hedging solution, provided by Krungthai Bank in Thailand is designed to comprehensively address and fully mitigate PTTEP’s FX risk. From the outset, the bank engaged in close collaboration with PTTEP to understand the company’s unique financial and accounting needs, ensuring the product is precisely tailored to meet its specific requirements.

This project has benefitted from a thorough analysis of PTTEP’s FX exposure, and the design of a hedging strategy not only mitigates risk but also integrates seamlessly with PTTEP’s existing financial and accounting frameworks. Both teams worked diligently to secure all necessary approvals for the product launch, while also coordinating with PTTEP to ensure the solution was seamlessly integrated into their financial practices. As a result, PTTEP benefits from a robust and reliable FX risk management solution that minimises the potential for mismatches between FX MTM valuations and AR. This solution not only enhances risk management capabilities but also supports the overall financial stability and performance of the company.