Agriculture needs more loans, irrigation systems, experts say
May 20th, 2013, The Phnom Penh Post, Agriculture & Agri-business, Banking & Finance, Borrowing, Business & Commercial Development, Economics, Farming, Financial Services, News Source, Rice
Accessing low-interest loans for rice cultivation is a challenge because the industry in Cambodia is dependant upon rainfall and not irrigation and is thus more risky, experts said last week.
In a meeting on the private sector development in the rice sector, Lim Heng, vice president of the Cambodia Chamber of Commerce, suggested that the government should supply more irrigation systems for better rice output.
“If we do not have enough water systems and still depend on the rainfall, the risk can be very high,” Lim Heng told participants in the meeting. “Therefore financial institutions will be hesitant to give us loans as they think it is too risky. …
Research over the past two years conducted by Srey Chanthy, an independent agricultural analyst, shows that at least $1 billion per year is needed by farmers to strengthen production. …
Instalment payments for goods gaining purchase
May 17th, 2013, The Phnom Penh Post, Banking & Finance, Business & Commercial Development, Domestic Investment, Economics, Financial Services, Foreign Investment, News Source
AEON Microfinance (Cambodia) Co, part of Japan-based AEON Group, said sales by instalment for electrical appliances and motorbikes increased by 715 per cent in the first quarter of 2013 year on year, a trend industry experts say will grow further with increasing demand for electronics.
Started in December 2011, loan disbursement reached $2.5 million with 5,000 new customers in the first quarter of this year, compared to $343,000 in the same period of 2012, managing director Daisuke Maeda told the Post yesterday.
“Smartphones and PCs are the most popular, followed by motorbikes,” he said. …
The total loan portfolio of AEON Microfinance (Cambodia) at the end of the first quarter this year was about $4 million, with 6,500 customers, Daisuke Maeda said. …
Anne Renzenbrink
http://www.phnompenhpost.com/2013051765679/Business/instalment-payments-for-goods-gaining-purchase.html
PM Defends Interest Rates
May 16th, 2013, The Phnom Penh Post, Banking & Finance, Borrowing, Debt Servicing, Economics, Financial Services, News Source
Prime Minister Hun Sen yesterday lashed out at the opposition party’s concerns over the interest rates charged by commercial banks to farmers.
SRP lawmaker Yim Sovann said commercial banks in Cambodia charge customers very high interest rates, and said it is much higher than in other countries. …
However, the premier, speaking at the opening of a new rubber processing plant in Stung Treng province said Sovann’s words do not apply with the market practice and the real situation in Cambodia’s economy. …
“Based on the market economy, they don’t allow the state to handle commercial bank. We have a national bank which cannot provide that serivce to customers. If people have money to deposit at the bank, they will get five per cent, some give four per cent and other 5.6 per cent [interest rate],” said Hun Sen. …
“To lower the interest rate to one per cent, it would kill the bank … They are against the political protectionism,” he said. …
According to the statistics from the National Bank of Cambodia, the Kingdom’s 32 commercial banks have lent $5.49 billion to about 1.6 million borrowers by November 2012, up 30 per cent year-on-year. …
Chhay Channyda and David Boyle
http://www.phnompenhpost.com/2013051665645/Business/pm-defends-interest-rates.html
Japanese bank to boost local investments
May 10th, 2013, The Phnom Penh Post, Banking & Finance, Business & Commercial Development, Financial Services, Foreign Investment, News Source
Japanese Bank of Tokyo-Mitsubishi UFJ (BTMU) signed an agreement yesterday with local Canadia Bank to shore up Japanese growth in Cambodia and to demonstrate its confidence in the Kingdom’s financial sector.
BTMU’s managing executive officer, Takami Onodera, and Pung Kheav Se, chairman of Canadia Bank, yesterday signed the agreement with the intention of bringing more Japanese investors to Cambodia. …
Japanese investment totalled about $330 million last year, a big jump from about $75 million in 2011.
Furthermore, data from the Japanese Business Association of Cambodia show that there were 101 Japanese companies here at the end of 2012, an increase from 69 the year before. …
Hor Kimsay
http://www.phnompenhpost.com/2013051065537/Business/japanese-bank-to-boost-local-investments.html
Insurance Institute To Boost Skills in Kingdom
May 8th, 2013, The Phnom Penh Post, Business & Commercial Development, Economics, Financial Services, Foreign Investment, Industry, International Relations, Labor, News Source
An insurance training centre is being planned in Cambodia to develop local expertise lacking in the Kingdom’s nascent insurance industry.
The institute hopes to offer diploma courses to industry leaders here so they in turn will be qualified to provide insurance training to others, such as their own staff, said Chhay Rattanak, chairman of the Insurance Association of Cambodia (IAC), the representative body for the Kingdom’s nine insurance companies.
The classes would be accredited by the Malaysian Insurance Institute (MII), a non-profit organisation that provides insurance training. Companies that face problems hiring qualified locals would benefit, because currently “not many people know about insurance, and some students want to study it, but do not know where to go to”. …
Low Wei Xiang
http://www.phnompenhpost.com/2013050865476/Business/insurance-institute-to-boost-skills-in-kingdom.html
New MFI To Launch Operations
May 7th, 2013, The Phnom Penh Post, Banking & Finance, Borrowing, Business & Commercial Development, Economics, Financial Services, Foreign Investment, News Source
A new microfinance institution (MFI), ORO Financecorp Plc, is set to open in Cambodia, according to the director-general of the National Bank of Cambodia (NBC). …
Cambodia already has 35 registered MFIs, according to a recent report by the Cambodia Microfinance Association (CMA). …
Last week, the Post reported that the loan portfolios of the 35 registered MFIs and four NGOs that are members of the CMA reached $1 billion at the end of March, a 41 per cent increase from the same time last year. …
Anne Renzenbrink and Low Wei Xiang
http://www.phnompenhpost.com/2013050765436/Business/new-mfi-to-launch-operations.html
Mobile Banking Services On A Rise
May 7th, 2013, The Phnom Penh Post, Banking & Finance, Economics, Financial Services, News Source
F1soft Company, a software service provider that makes banking transactions available via phone, had commenced operations in Cambodia, company officials said yesterday during a workshop. …
Sean Thorninn, a lecturer in economics at the Limkokwing University and expert in Cambodia’s landscape of microfinance institutions (MFI), told the Post a growing number of financial institutions in the Kingdom were begining to provide mobile financial services. To maintain their existing clients and to aggressively compete in the market, banks and MFIs strategically have been “emerging to a new era of branchless banking”, he added. …
Hor Kimsay
http://www.phnompenhpost.com/2013050765437/Business/mobile-banking-services-on-a-rise.html
Government Mulls Issuing Sovereign Bonds
May 6th, 2013, The Cambodia Daily, Banking & Finance, Business & Commercial Development, Economics, Financial Services, Foreign Investment, International Relations, Trade
Cambodia is considering offering sovereign bonds to raise more revenue for the national budget and move away from its dependence on overseas aid, a senior central bank official said Sunday.
National Bank of Cambodia director-general Nguon Sokha said the Ministry of Economy and Finance was currently looking at other countries’ experiences with bond markets and was seeking outside help to issue the government’s first bonds.
By issuing sovereign bonds governments can raise money from international investors that are usually paid back with interest at the end of a fixed term. …
Ms. Sokha said there was no set date for when the bonds might be issued, but officials were working on the plan with help from the Asian Development Bank (ADB) and members of the Asean+3 group, which includes China, Japan and South Korea. …
Cambodia is set to graduate this year or next to a lower middle-income country but still qualifies for overseas development assistance and concessional loans from international institutions.
“For long term financing, we cannot really survive on development assistance,” Ms. Sokha said. …
Although Cambodia does not currently issue sovereign bonds, it has been assessed recently by credit rating agencies. The most recent assessment by Moody’s gave the country a stable but high-risk “B2” rating, which means Cambodia is deemed to have “very low economic resiliency.”
Simon Lewis
http://www.cambodiadaily.com/business/government-mulls-issuing-sovereign-bonds-21989/
Cambodia’s micro-lenders record 24 pct lending growth in Q1
May 3rd, 2013, Asean - China Centre, Banking & Finance, Business & Commercial Development, Economics, Financial Services, Industry
Cambodia’s 35 microfinance institutions had lent 1 billion U.S. dollars to customers by the end of March this year, up 24 percent from 808 million U.S. dollars it lent at the end of last year, the data of Cambodia Microfinance Association (CMA) showed Wednesday.
On the deposit side, the customers’ deposits at microfinance institutions had amounted to 346 million U.S. dollars at the end of March this year, up 54 percent from 225 million U.S. dollars at the end of last year, the data said. …
Asean-China-Center News Staff
http://www.asean-china-center.org/english/2013-05/03/c_132357476.htm
Prakas Set to Control Tax Agents
May 2nd, 2013, The Phnom Penh Post, Business & Commercial Development, Economics, Financial Services
The Ministry of Economy and Finance (MEF) last month signed a prakas, a ministerial decision, to ensure tax agents’ professionalism, an insider told the Post yesterday. …
After the full implementation of Prakas 455, signed on April 12, agents have to pay one million riel to obtain a licence every two years. They need to be at least 18 years old, have a relevant qualification or record of study of at least six months and a clean criminal record.
Professionals also need to pass an examination, unless they already have a professional document from the MEF or the Kampuchea Institute of Certified Public Accountants and Auditors (KICPAA), or are former tax officials. …
Sarah Thust
http://www.phnompenhpost.com/2013050265367/Business/prakas-set-to-control-tax-agents.html
Huge Increase in MFI Loans, Deposits
May 2nd, 2013, The Phnom Penh Post, Banking & Finance, Borrowing, Business & Commercial Development, Financial Services
More economic activity and a better understanding of using formal financial services among rural residents are leading to good loan performance rates and increases in savings deposits in Cambodia’s microfinance industry, according to industry sources.
The loan portfolios of the 35 registered microfinance institutions (MFI) and four NGOs that are members of the Cambodia Microfinance Association (CMA) reached $1 billion at the end of March, a 41 per cent increase from a year earlier, according to recent figures from the CMA.
Deposits made at seven microfinance institutions that are licensed to take deposits (MDIs) reached $346 million, a 145 per cent increase over the past 12 months. …
Hor Kimsay
http://www.phnompenhpost.com/2013050265366/Business/huge-increase-in-mfi-loans-deposits.html
Online Trader Eyes Kingdom
April 30th, 2013, The Phnom Penh Post, Banking & Finance, Business & Commercial Development, Economics, Financial Services, Foreign Investment, Labor, News Source
An online trading firm based in the tax haven of Cyprus is planning to open a subsidiary in Cambodia, an account manager at IronFX’s headquarters in Cyprus said yesterday.
“We are on the planning stage in Cambodia. We are now studying law and regulations in the country right now,” account manager Siwapong Meesuntree said by Skype. …
When asked about reports from sources at recruiting firms in Phnom Penh that local staff had already been hired to receive training at IronFX’s headquarters in Cyprus, Siwapong replied: “We will have Cambodia staff very soon.”
Cyprus’s financial services industry has been in the spotlight this year following that country’s financial crisis. The island nation’s financial services industry had grown massively through a combination of tax and regulatory incentives, including a high level of secrecy that can, in some cases, “make the disclosure of information in Cyprus offshore bank accounts … punishable by the law”, according to tax haven experts. “Bank employees and other persons who are associated with Cyprus banks must take an oath of secrecy,” the website Taxhavens.biz says. …
Vincent MacIsaac
http://www.phnompenhpost.com/2013043065307/Business/online-trader-eyes-kingdom.html
World Bank Says Credit Growth Still a Risk
April 29th, 2013, The Cambodia Daily, Banking & Finance, Borrowing, Business & Commercial Development, Construction, Economics, Exports, Financial Services, Foreign Investment, Imports, Industry, Infrastructure, International Relations, Social Concerns, Trade
The World Bank has warned that the rapid growth of lending by Cambodia’s Banks is still a concern, despite a recent slow-down in credit disbursals.
“Credit growth, which has been driven largely by wholesale and retail financing, and starting in 2011 agriculture financing, has eased to 29.2 percent (year on year) in January 2013,” the bank said in an economic update sent out on Friday.
The annualized rate of lending growth was 34 percent in December and as high as 34.6 percent in January 2012, the bank said.
The high rate of growth had raised concerns of overheating from international financial institutions, and led the National Bank of Cambodia to raise the reserve requirement imposed on Banks from 12 to 12.5 percent in September. …
[The World Bank] also noted that Cambodia’s trade deficit in 2012 was 11.5 percent, up from 8.7 percent in 2001, due to rising fuel imports and construction materials being brought in for large hydropower projects.
However, this was cancelled out by a jump in foreign direct investment, which reached $1.5 billion last year.
Simon Lewis, P.21
http://www.cambodiadaily.com/business/world-bank-says-credit-growth-still-a-risk-20690/
Credit growth in Cambodia’s banking sector slightly up in 1st two months
April 27th, 2013, Asean - China Centre, Banking & Finance, Borrowing, Business & Commercial Development, Economics, Financial Services, International Relations
Cambodia’s banking industry recorded a slight increase in lending in the first two months of this year after a sharp rise last year, according to a consolidated data provided by the National Bank of Cambodia (NBC) on Saturday.
The data showed that the kingdom’s 33 commercial banks had lent a total of 5.99 billion U.S. dollars to customers by the end of February this year, up 1.7 percent from 5.89 billion U.S. dollars at the end of December last year, the report said.
It added that 32 percent of the loans went to wholesale and retail trade, 10 percent to agriculture, 9 percent to manufacturing, 8 percent to construction, 6 percent to hotels and restaurants, 6 percent to mortgages and the remaining percentage went to financial institutions, real estate and personal borrowing. …
By the end of February this year, the NBC said that the banks received 6.25 billion U.S. dollars, up 1 percent from 6.19 billion U.S. dollars at the end of last year.
Cambodia has the population of about 14.5 million. Its banking sector has been serving about 1.6 million borrowers and 1.9 million depositors, according to the NBC.
Xinhua News Staff
http://www.asean-china-center.org/english/2013-04/28/c_132347546.htm
Mortgage Lending Rises for New Home-Buyers
April 25th, 2013, The Cambodia Daily, Banking & Finance, Borrowing, Debt Servicing, Financial Services, Real Estate
Cambodians, particularly young adults, are more often turning to banks to help them buy their homes, according to figures obtained from the National Bank of Cambodia (NBC) yesterday. …
From $179 million in 2008, the total sum lent out to those buyers fell to $94.5 million in 2009, the figures show. But in 2012, home loan lending reached $329.5 million – a 20 percent increase on the previous year – and by February it was at $344.5 million, according to the NBC. …
Acleda, the country’s biggest lender, has seen the number of borrowers getting home loans increase from 2,422 in 2010 to more than 4,550 in March, with the value of the bank’s outstanding home loans reaching $97 million. …
Simon Lewis
http://www.cambodiadaily.com/business/mortgage-lending-rises-for-new-home-buyers-20083/
Cambodia’s leading bank inks deal with UnionPay International for payment services
April 23rd, 2013, Asean - China Centre, Banking & Finance, Business & Commercial Development, Economics, Financial Services, Industry, International Relations
Acleda Bank, a leading commercial bank in Cambodia, on Monday signed a Memorandum of Understanding with UnionPay International on payment services for mutual benefits, according to the bank’s statement.
Xu Luode, president of China UnionPay and vice-chairman of UnionPay International, said currently, UnionPay cards reached more than 3.5 billion, and UnionPay network has been extended to 141 countries and regions in the world. …
Xinhua News Staff
http://www.asean-china-center.org/english/2013-04/23/c_132333810.htm
Insuring for higher education
April 23rd, 2013, The Phnom Penh Post, Banking & Finance, Business & Commercial Development, Financial Services, Foreign Investment, News Source
Canada-based life insurance company Manulife has launched a product intended to provide parents with security for their children’s education, and officials at the firm say they are optimistic about its prospects. …
Manulife’s research found that even families who were financially struggling would take advantage of opportunities to secure funds for their children’s future.
The product was created to help parents set aside money and protect their finances for their children’s higher-level education. …
Rann Reuy
http://www.phnompenhpost.com/2013042365160/Business/insuring-for-higher-education.html
BoC is set to expand after rapid growth
April 22nd, 2013, The Phnom Penh Post, Banking & Finance, Business & Commercial Development, Financial Services, News Source
Having seen rapid growth since launching in Cambodia two years ago, the Bank of China (BoC) plans to expand its business operations here.
According to a Xinhua report, BoC’s deputy governor Zhu Shuming said during his visit to Cambodia last Friday that its local operations have started to make a profit. “The bank’s progress shows that Cambodia’s banking sector still has much room to grow.” …
Low Wei Xiang
http://www.phnompenhpost.com/2013042265138/Business/boc-is-set-to-expand-after-rapid-growth.html
Bank of China to raise business operations in Cambodia: deputy-governor
April 19th, 2013, People's Daily Online, Banking & Finance, Business & Commercial Development, Economics, Financial Services, International Relations, Trade
The Bank of China is going to expand its business operations in Cambodia after it was launched here two years ago and seen rapid business growth, Zhu Shuming, visiting deputy governor of Bank of China, said Friday.
Speaking at a meeting with Chea Chanto, governor of the National Bank of Cambodia (NBC), Zhu thanked the NBC for supporting the presence of Bank of China-Phnom Penh Branch, saying that the bank has seen rapid business growth since it was officially launched here in May 2011 and opened its first sub- branch in December last year. …
Currently, Cambodia has 33 commercial banks, serving about 1.6 million borrowers and 1.9 million depositors, according to the NBC. …
Xinhua News Staff
http://english.peopledaily.com.cn/90778/8214949.html
MFI Increases Loans as Economy Grows
April 19th, 2013, The Phnom Penh Post, Agriculture & Agri-business, Banking & Finance, Borrowing, Business & Commercial Development, Economics, Financial Services
As rising economic growth spurred demand for personal loans, Prasac, Cambodia’s biggest microfinance institution (MFI), provided $106 million in loans between March, 2012 and March, 2013, an increase of 66 per cent compared with the corresponding period a year earlier. …
“Loans [were] mainly used for service and trade activities, representing 44 per cent; followed by agriculture, [accounting for] 30 per cent; and personal loans, [accounting for] 23 percent,” [Prasac president and chief executive Sim Senacheert] said. …
According to a study released this month on micro-finance borrowing in Cambodia, “The sharp growth of the sector has resulted in substantial competition, and there have been concerns that it may be leading to cross-lending and, possibly, over-indebtedness of borrowers.”…
Low Wei Xiang and Anne Renzenbrink
http://www.phnompenhpost.com/2013041965111/Business/mfi-increases-loans-as-economy-grows.html