Since mid-April, Cambodia’s currency goes down nearly 2 percent against dollar but it has held steady after the NBC has taken immediately action to stabilized Riel by purchasing the riel in a bid to create artificial demand for the notes and raising its value against greenback.

Tay Nay Im, The National Bank of Cambodia’s Director General, said that in general, appreciates staring October. She added that “the riel depreciates seasonally. We do not see anything abnormal.”

The NBC will auction the next $5 million in five separate $1 million lots from September 01 to 10 at the Central bank’s headquarters in Phnom Penh.

Last year, NBC purchased $54 million.

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Initially, offering fund is for civil servants in Phnom Penh and it will be available through the banks a standalone bank account with its own ATM card. Having the account accessible through the bank would allow the correct funds to get to the end-users in a timely manner.

Chou Ratanak, the director for the Fund, was quoted by the Post as saying that the new NSSFCS fund aims to manage and insure a social security fund for when a civil servants retires or becomes handicapped, pregnant or is involved in an accident at work resulting in disability or death.

“Moreover, they can save their money through the fund, which will also have an interest rate with Canadia Bank,” Chou Ratanak said.

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This year, NBC approved three foreign banks to operate in Cambodia, including the Bank of Agriculture and Rural Development of Vietnam (Agrbank), the CIMB Group and Malaysia and the Bank of China.

Thai Saphear, head of the NBC governor’s office, was quoted by the Phnom Penh Post as saying that a courtesy call from China’s new ambassador to Cambodia, Pan Guangxue, resulted in NBC Governor Chea Chanto giving the green light for the BOC to establish itself in Cambodia as early as the end of this year.

He added that “it’s a positive sign for the bank because they have the green light from the NBC already.” “It’s up to the bank if it wants to open its branch soon or not, but if they want to open soon, it could be done this year.” said he.

Following the in-principle approval, the bank has six months to prepare the required documentation to obtain the full operating licence, he said.

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Mobiles phone will have access to Unity’s SMS-based banking service, including balance inquiry, mini-statements and mobile top-ups, but the phone must be capable of operating a web browser or hosting Unity’s phone application to be able to transfer funds between separate ACLEDA accounts, or to complete bill payments.

It is expected that bank will cut operational costs and reduce queues at its branches by offering mobile banking. It is also able to gain some revenue by charging for fund transfer and balance inquiry and other transactions/

Customers are required to pay its registration service fee of $5, 20,000 riels or 200 baht, and all currencies will be supported by Unity. In addition, there will be also associated fee for each transaction performed.

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Phan Ying tong, the bank’s country head, was quoted by the Post as saying in press release Thursday that the opening of the branch is part of its long-term strategy of organic growth to expand its branch network and provide excellent customer service.

Cambodian Public Bank Plc commenced its business in Cambodia on May 25, 1992. Presently, it has 19 branches including 7 in Phnom Penh, 1 each in Preah Sihanouk, Siem Reap, Battambang, Kampong Cham, Takmao, Pol Pet, Bavet, Kampot and Phnom Penh Special Economic Zone and a Service Branch each in Monivong, Phsar Doeumkor and Toul Tom Poung.

According to Campu Bank’s website, as December 31, 2009, Campu Bank’s paid-up capital of USD90 million is the highest among the commercial banks in Cambodia while its shareholder’s funds and asset size amounted to USD176.6 million and USD43.3 million respectively.

Campu Bank is a wholly-owned subsidiary of Public Bank Group which is one of the largest and strongest domestic banking groups in Malaysia.

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“Sustainability is a vital vision of ACLEDA bank. It was founded with such sustainability for 17 years ago to provide exclusive financial services for all- both private and public. This continues to be our guiding principle today throughout the 248 branches and offices in the Kingdom of Cambodia and the Lao PDR,” In Channy, president and CEO of ACLEDA bank, said during the grand occasion.

ACLEDA bank has 76 standard offices to provide the most comfortable and efficient facilities for its customers to conduct their financial transactions.

Recently, the bank has launched a top-up service suing mobile-mobile technology and service which allows customers to pay bill via mobile phone.

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The bank’s NPL rate – counted as loans the borrower has defaulted on for three months – rose to 6 percent from 5.56 percent in the last quarter of 2009. Lending remained at US$105 million each quarter.

“We’re still cautious in evaluating clients for loans, and it’s currently hard to get a good client with a good business plan,” FTB General Manager Gui Anvanith said last week. “We’ll dare to lend as much as $50 million if it’s a good business project.”

The FTB has witnessed a huge turnaround in its non-performing loans from 2008, when it had the highest NPL rate in Cambodia at 32 percent. By the end of 2009, that rate had been cut to 5.56 percent, surprising bank managers themselves.

Like other banks in the Kingdom, FTB is maintaining high liquidity, with $168 million deposited in the central bank at the end of last year.

FTB is focusing on business ventures, small and medium-sized enterprises and agricultural businesses, rather than real estate developments, Gui Anvanith said.

“We have little appetite for hotel-development projects,” he said. “For those in [Phnom Penh], we might consider them, but those in Siem Reap, we say no, as the province is too crowded with hotels.”

The bank is avoiding other real estate projects, such as apartments, with tens of thousands of units built and many unable to find buyers, he said.

Deposits at the FTB rose 1.7 percent, to $230 million, quarter on quarter, and the bank posted a first-quarter net profit of $1.38 million.

Stephen Higgins, CEO of ANZ Royal Bank, said business conditions for banks have been improving so far this year.

“First-quarter performance has been strong at [ANZ Royal], with revenue more than 20 percent higher than for the first quarter last year,” he said.

Higgins expects his bank to comfortably surpass results for 2009, when the bank’s NPL rate nearly doubled to 5 percent.

Cambodian banks and lending institutions saw their NPL rates rise after the global economic downturn, as borrowers abandoned projects and payments.

The National Bank has said the rate of NPLs is not of great concern, as it has remained below 10 percent of all outstanding loans.

Source: the phnom penh post

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The loan covers the Royal Group’s November purchase of Luxembourg-based Millicom International Cellular SA’s network operations in the Kingdom for $346 million. The acquisitions included a 58.4 percent holding in Mobitel, Royal Telecom International Co Ltd and Cambodia Broadcasting Service Co Ltd.

The debt-leveraged deal is thought to have given the Royal Group 100 percent ownership of Mobitel in an agreement lead-arranged by ANZ bank.

The loan also refinances debt, including a $100 million loan arranged by International Finance Corporation in 2008.

Royal Group Chief Financial Officer Mark Hanna said Thursday that the loan sell down was “standard procedure” in the acquisition, “the biggest of its kind ever done in the region”.

Highlighting the fact that a Cambodian group was able to buy out a majority stake from a major international company, Hanna said: “It really increases the exposure that Cambodia gets.”

He added that the assets bought from Millicom form “a central part” of the Royal Group’s plans for the future.

A spokeswoman for ANZ, which is book-running and arranging the sell down together with Standard Bank, said via email from Singapore Thursday that the loan was put out for syndication on Monday.

Responses are due in the last week of April this year, she said. Lenders have been invited to join at five ticket levels, Reuters reported Thursday, paying interest of as much as 14.73 percent.

“According to Thomson Reuters LPC data, only eight syndicated loans have been completed in Cambodia, and this facility is the country’s biggest-ever corporate deal,” the ANZ spokeswoman added.

The Royal Group partnered global telecoms company Millicom for a total of 14 years.

After a strategic review of its South-East Asia assets, Millicom decided to sell its holding to its joint partner. On announcing the then prospective deal last August, Mikael Grahne, CEO of Millicom, said in a press release: “We are very proud of having played an important role in the development of the leading mobile operator in Cambodia and are very confident of the continued success of Mobitel and its people within the Royal Group.”

Millicom also approved the sale of its Laotian operations to Russia’s JSC Vimpel-Communications (VimpelCom) for $65 million. Moscow-based Vimpelcom is the parent company of Beeline, the newest entrant to Cambodia’s crowded market for mobile-phone service. It announced last week that it had garnered more than 370,000 active subscribers in the Kingdom since its launch last May.

Last week, Huawei Technologies, China’s largest private hi-tech enterprise, signed a $200 million cooperation agreement with Mobitel to extend its network.

Source: The Phnom Penh Post

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“Lending growth has picked up recently after a very substantial slowdown through most of 2009,” John Nelmes, IMF resident representative, wrote in an email Friday. “Lending growth of between 15 and 20 percent in 2010 would be in line with a modest recovery in economic activity and a reasonable increase in loan demand.”

Cambodian banks put restrictions on their lending in the fallout from the global economic crisis, but they have continued to compete for depositors.

Loan growth grew just 3.2 percent to US$2.42 billion in 2009, up from $2.34 billion the year before, according to National Bank of Cambodia figures. Deposits rose 32.7 percent to $3.28 billion in the same period.

Deposit growth is likely to slow as banks back away from competitive offers that have created too much cash and forced them to make large deposits in the National Bank at low interest rates, Nelmes said.

“This negative spread – the difference between what banks pay for deposits and what they earn on them – is undermining profits,” he said.

“That situation cannot continue indefinitely, so looking forward, I would expect to see deposit interest rates decline, and deposit growth slow,” he said. “At the same time, lending rates may not fall very much, as banks look to rebuild their profit margins.”

Yum Sui Sang, CEO of Union Commercial Bank, whose clients are mostly garment manufacturers from Hong Kong and Macau, said the bank has seen an increase in borrowing demand.

“Lending growth will definitely increase this year but I cannot predict the increase percentage,” he said, adding that demand for loans remains low.

Union Commercial was seeking to reduce its cash by dropping a percentage point on deposit rates, to 6.5 percent, he said, but the bank still wants to attract more depositors.

“Even though we are too liquid, we’re still willing to attract more deposits, as it is the blood of the bank for the long-term goal,” he said.

Dieter Billmeier, vice president of Canadia Bank, told the Post this month that the bank had $200 million in deposits at the National Bank at the end of 2009 and that borrowing demand had climbed from October 2009 into February 2010. Canadia Bank expects growth potential of 15 percent to 20 percent over 2009, he said.

National Bank Director General Tal Nay Im said Sunday that bank lending would depend on an economic recovery.

“We have seen gradual lending growth since the start of the year, but it’s still too early to predict,” she said. “If the economy recovers well, the capital demand for production will increase as well.”

At the end of 2009, commercial surplus liquidity reached $900 million. High liquidity can drive down loan rates, when banks want to turn their assets into profits, but it can also lower deposit rates as they seek to balance profit margins.

Tal Nay Im predicted an increase in depositors in 2010, as more people realise the advantages of bank accounts.

Source: The Phnom Penh Post

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Chea Chanto, NBC’s governor, also has warned tourists and the public to be careful of being defrauded by unlicensed money changers along Cambodia’s borders.

According to the announcement of NBC, “in order to guarantee personal interests and prevent accidental losses, the public should be careful, and in case of requiring the exchange of money, please, the public must change in shops that show their license, which is issued by the National Bank of Cambodia.”

The Phnom Penh Post quoted Chea Chanto as saying that “to avoid eventually losing out, customers should have their money exchanged at booths displaying operating licenses from the central bank.”

According to the notice, a few money changing shops, particularly along the border with Thailand have cheated visitors and have even passed counterfeit Cambodian riel to customers.

NBC inspection of money-changing racket on the Kingdom’s borders found many offered exchange rates far below the market rate, some as low as 2,500 riels for US$1. A dollar was worth 4,167 riels Monday, the Post reported.

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