ASEAN KEY DESTINATIONS
Cambodian banking sector develops
The Cambodian banking industry saw lending increase at an annualised 26.7 percent in 2010, while deposits increased 26.3 percent during the period, according to National Bank of Cambodia governor Chea Chanto.
The increase came as a result of increased investor confidence in Cambodia's financial sector, he said in a copy of a speech released following the bank's closed-door annual meeting on Tuesday.
"The growth in both deposits and loans reflected that the Cambodian banking system has developed well in scope and operational extent," he said.
"It also shows that the sector has gained more confidence from both local and foreign customers and investors."
Deposits at the Kingdom's banking institutions totaled US$4.16 billion last year, a 26.3 percent increase on $3.3 billion in 2009, according to his speech. Lending increased 26.7 percent to $3.18 billion, from $2.51 billion in 2009.
Nonperforming loans also improved, with rate of bad loans dropping to 3 percent at the end of 2010, from 6 percent in 2009, according to the NBC. A non-performing loan is defined by the central bank as a loan on which the borrower has been in default for three months. Foreign reserves held by the central bank had increased 7.7 percent to $2.55 billion at the end of 2010, from $2.36 billion a year earlier.
ACLEDA Bank president and chief executive officer In Channy said that sector trust was increasing in Cambodia.
"People are beginning to understand and trust our banking industry, as it offers convenient and safe service," he said. "On the other hand, strong regulation of the industry can provide mutual benefit."
On Tuesday, the IMF raised concerns over the NBC's capacity to manage its oversight responsibilities. A central bank representative said the bank was making an effort to strengthen itself.
ACLEDA's outstanding loans increased 36.82 percent to $744 million in 2010, from $544 million in 2009. Its deposits totaled $911 million last year, a 31.65 percent annualised increase.
Canadia Bank vice president Dieter Billmeier also said loans and deposits were on the upswing at his bank.
Lending increased 30 percent in 2010 year on year to $520 million, while deposits climbed over 40 percent - reaching about $820 million, he said.
Cambodia currently has 30 commercial banks, seven specialised banks, and 25 microfinance institutions. Three large international banks - Malaysia's CIMB, the Bank of China, and the Vietnam Bank for Agriculture and Rural Development - launched operations in Cambodia last year.
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