ASEAN KEY DESTINATIONS
Second Chinese bank for Cambodia
Head of the Governor's Office of the National Bank of Cambodia Thai Saphear, said yesterday that the central bank gave the Industrial and Commercial Bank of China approval late last week.
"The governor Chea Chanto granted approval-in-principle to open a branch in Cambodia while meeting with the management of ICBC," he said. "This is the huge bank."
ICBC's entry follows the scheduled launch of the Bank of China, set to open later this year. Last week, BoC signed a refinancing deal with domestic mobile provider Mobitel for US$591 million.
Malaysia's CIMB is also entering the market, and has now already received the licence to operate, according to Thai Saphear. Its official launch is expected next week.
"Many foreign banks with international standards are investing in Cambodia, reflecting a confidence in political stability and economic potential of investment opportunities," he said.
"More banks will bring more capital for the development of the economy, bring more technology for the industry, and create more jobs."
ICBC now has six months to meet NBC requirements on registered capital, statutes and potential location.
Jiang Jianqing, president of ICBC, met with Prime Minister Hun Sen on Friday, according to officials.
Hun Sen's spokesman Eang Sophaleth told reporters that ICBC said that the bank was looking at expansion to Cambodia due to the close relationship between the two countries.
"The bank's loans target mainly the energy sector and construction of hydro-power projects. Currently, many Chinese firms are investing in these sectors," Jiang Jianqing was quoted as saying by Eang Sophaleth.
ICIB has branches in Singapore, Thailand, Vietnam, Indonesia and Malaysia.
Hun Sen's spokesman said the premiere welcomed ICBC's move, but urged the bank to focus on agriculture.
General Manager of Foreign Trade Bank of Cambodia Gui Anvanith said yesterday that the arrival of such huge banks would be positive for large-investment projects, but may not represent direct competition for Cambodian rivals.
"We don't have much concern about new comers because we have different battles [to fight].
"They focus their loans mainly on huge projects invested by their respective countries' investors, such as hydro-power and coal-fired power, and we focus on local companies," he said.
"However, we don't ignore them in the context of competition - we have to keep close eyes on their granting of interest rates on deposits and loans," he said.
When the three new banks come online, the number of commercial banks in Cambodia will rise to 31.
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