Cambodia Weekly Financial News

Cambodia Weekly Financial News
May 20 ~ 24 , 2024

20 May 2024

CBC Report Reveals Retail Loans Hit $15.21B 

According to the CBC Retail Credit Index report in the first quarter of 2024, the retail loan balance stood at $15.21 billion. Mortgages made the largest share at 53.2 percent, followed by personal finance loans at 45.63 percent and credit cards at 1.17 percent. The total credit value across 25 provinces in Cambodia in 2023 was 232.4 trillion riels, approximately $58 billion, which was borrowed by 4.98 million people. Loans at Phnom Penh, Kandal, and Siem Reab made up nearly 60% of the total, although Phnom Penh accounted for 50% at 114.5 trillion riels (28.62 billion) with 677,000 borrowers. Retail Credit Performance which indicated the volume of consumer loans showed that the number of retail loan accounts by type as of March 2024 stood at 1.83 million accounts. Some 80.9 percent were for personal finance, 11.03 percent on mortgage and 8.07 percent on credit cards. 
Source : Kiripost

20 May 2024

Cambodia, Korea foster ties with SEZ plan 

Cambodia and South Korea are poised to strengthen their economic partnership with a plan to establish special economic zones dedicated to Korean companies in Cambodia, as the two countries agreed to leverage the Regional Comprehensive Economic Partnership agreement and other free trade agreements for the benefit of all. The initiative of the special economic zone envisioned as a hub for Korean investment is expected to attract more business and investment. The Cambodia-Korea partnership extends beyond the SEZ proposal. Both sides also agreed to enhance cooperation in digital trade and intellectual property for innovation-driven sustainable development.

Source : Khmer times

21 May 2024

Dollarization remains high, says FSR report 

When it comes to bank credit, the majority of loans are still given out in US dollars.But there is a slow increase in riel-backed loans, said the NBC. The higher riel usage could be due to efforts by the Central Bank to increase liquidity. As per the report of the NBC, “Negotiable Certificate of Deposits (NCDs) and Liquidity Proding Collateralized Operation (LPCO) are two main monetary policy tools which have been implemented by the NBC to support the interbank market development.” As per this report, the total amount of US-denominated NCDS issuance was USD 5.2 billion, which is an 84.5 percent decrease compared to the previous year, and KHR-denominated NCDs issuance was KHR 17 trillion, which decreased by 2.1 percent. 

Source : Khmer times

21 May 2024

NBC Governor Urges Banks to Step up Action Against Fraud 

The Governor of the National Bank of Cambodia, Chea Serey has urged all banking and financial institutions to prioritize resolving customer complaints and strengthening their management against cyberattacks,while digital payment transactions jumped by 59.6 percent to 1.8 billion transactions in 2023. According to the Financial Stability Review 2023, the total number of digital payment transactions jumped by 59.8 percent to 1.8 billion transaction in 2023. In terms of value, the total amount of digital payments was recorded at 2,021.3 trillion riels ($491.8 billion), an increase of 24.2 percent, equivalent to almost 12 times the Gross Domestic Product (GDP). Rath Sophoan, president of the Association of Banks in Cambodia, said that all banks and financial institutions should improve their management systems in light of the growing prevalence of digital payments and cyber securities. 

Source : Kiripost

21 May 2024

NBC offers an optimistic outlook in the new FSR 

The National Bank of Cambodia launched its Financial Stability Review 2023 yesterday.outlinig Cambodia’s financial system and proactive measures to ensure its continued stability amidst global economic uncertainties. The FSR,however, offered an optimistic outlook,stating that Cambodia’s banking sectors has displayed remarkable resilience as reflected in its high capital adequacy and liquidity ratios. Credit growth in the banking system reached $57.6 billion last year, up only 4.8 percent from a year earlier, while deposits increased by a healthy 13.1 percent to $47.9 billion in 2023, an NBC report showed. Within the banking system, commercial banks accounted for 91 percent of the total assets, with $76.9 billion, after the largest microfinance deposit-taking institution (MDI) emerged with a bank last year. NBC governor Chea Serey emphasized the importance of collaboration with relevant stakeholders in maintaining financial stability. 

Source: Khmer times 

21 May 2024 

RCEP, and FTAs to help Cambodia attract more FDIs, boost exports 

The Reginal Comprehensive Economic Partnership (RCEP) agreement and bilateral free trade agreement (FTAs) are expected to help Cambodia attract more FDIs and boost its exports, National Bank of Cambodia’s Governor Chea Serey here on Monday. Serey said these trade pacts will help boost Cambodia’s productivity and promote its economic diversification. The Kingdom’s economy is forecast to grow 6 percent in 2024, up from 5 percent in 2023, driven by a rise in exports, recovery in tourism, robust growth in transport and communication, and flat growth in agriculture. A government report said Cambodia approved a $2.5 billion fixed asset investment in the first four months of 2024, which will create approximately 130,000 jobs. 

Source: Khmer Times

22 May 2024

Average trading volume on CSX declined in 2023 

Trading activities experienced a big decline in 2023 compared to the year ago, said the NBC, CSX in an earlier statement that it plans to have a daily trade volume of $100 million by 2030. CSX in recent months has been trying to boost trading activity. For the first quarter of 2024, trading volume on the exchange for the Main Board was down by 34 percent and trading value by 57 percent, as per data on the CSX website. NBC said that the CSX index dipped slightly whereas its market capitalization jumped notably. The reason for the increase in market capitalization over six years between 2018 and 2023 was because of a host of initial public offerings in the last few years.  CSX in an earlier statement said that It plans to increase its trading activity this year. The exchange has set itself a target of increasing trading accounts to 100,000 in 2024 from some 49,000 registered in 2023. 

Source: Khmer times

22 May 2024

Cambodia tops emerging markets FDI index 2024 

Cambodia has taken the number one place in the 2024 index on account of its strong and consistent gross domestic product ( GDP) growth, low inflation rate, The report noted that such diversification increases the economy’s resilience to global demand shifts, and improves the market's potential for new investments. and swift growth in the foreign direct investment ( FDI) sector. According to the report, Cambodia, in first place, is on track for 6.1  percent GDP this year, with a low inflation rate of just 3 percent. Meanwhile, Cambodia has seen a whopping 393 percent increase in FDI capital expenditure in the country and 110 percent growth in new FDI projects. FDI Intelligence also commended Cambodia’s progress in economic diversification since 2019, a good sign that the economy is reducing reliance on traditional trade strengths, most significant being the export of garments and footwear  

Source: Khmer times

23 May 2024

More companies to list bonds on CSX this year 

The Cambodia Securities Exchange (CSX) is all set to see more companies listing their bonds than their equities this year and this could be because bonds are proving to be a viable source of alternative funding, as per a recent report of the National Bank of Cambodia. Currently, there are 23 listed companies on CSX, with 11 offering their equity shares and 12 offering their bonds. But it’s the bond market that’s set to see a boost more than equities in 2024. As many as five companies are likely to list their corporate bonds on CSX – which would take the total number of listed bond players to 17 versus 11 equity players. Given the number of fresh IPOs lined up for 2024, there are two reasons the bond market might currently be proving more attractive than the equities market. One is the current regulatory framework – the eligibility criteria for companies hoping to list in the equities market – is more strict than for the bond market. Secondly, bonds are traditionally viewed as more stable than stocks – they might provide lower long-term returns compared to equities. But the investor gets his coupon rate and the listed-bond company requires financing.

Source: Khmer Times

24 May 2024

Kingdom asks Japan to accelerate PAS expansion 

Cambodia has requested Japanese support for the upgrade of the Sihanoukville Autonomous Port (PAS), as well as a study into the development of a master plan which will guide the port’s development into a regional port and logistics centre by 2050. The request was via Sun Chanthol, first vice-president of the Council for the Development of Cambodia (CDC), who met with Saito Tetsuo, Japanese Minister of Land, Infrastructure, Transport and Tourism. The May 23 meeting took place in Tokyo, Japan on the sidelines of the 29th International Conference on “The Future of Asia”. The Japanese minister expressed his intention to urge all Japanese stakeholders to implement the expansion of PAS as soon as possible, to ensure that the project is completed as planned.

Source: Phnom Penh Post

24 May 2024

GDP To Grow at 5.6% in 2024 but Lookout For Risks,  AMRO says 

Economic growth will be driven by tourism, garments, and exports for Cambodia in 2024 from five percent last year, but global and domestic risks could derail the growth trajectory.  Short-term risks from outside Cambodia, such as potential shifts in US and EU trade policies, as well as internal risks, like the rise in non-performing loans (NPL), could impact economic growth, projected at 5.6  percent this year and 5.9 percent in 2025, according to ASEAN +3 Macroeconomic Research Office (AMRO). 

Source: Kiripost

 24 May 2024

GDT tax collection falls in  Q1 

The General Department of Taxation ( GDT) collected taxes totaling $1.18 billion during the January-March period this year, down 11.9 percent from $1.34 billion collected in the first quarter of 2023. Tax incomes from financial and insurance activities, import-export activities, and manufacturing activities are the main tax incomes, it stated in the report. The GDP earned $3.16 billion as taxes in 2023, a 4.5 percent increase from $3.45 billion in 2022. This $3.16 bliiion collected has ensured the department achieved 101 percents of its annula target, said the report.  

Source: Khmer times

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