10 Institutions in the Cambodia Banking Sector

Investment opportunities in emerging and frontier markets may not be for the squeamish or faint of heart, but opportunities are available. Frontier markets are capital markets at the beginning stages of economic development that show at least some potential of better than average growth over the long-term.

In 2011-2012, the Kingdom of Cambodia was identified by at least a couple investment firms as a frontier market. While much risk still remains in the Cambodia economic landscape, private equity investors looking for opportunities for capital growth through the micro-loan or small to medium business development may want to consider the Land of Smiles.

Of course, the first questions any serious investor or business developer might wish to ask before sticking their toes in might include questions of (a) political risk and (b) stability of the banking sector. While the political climate in the Kingdom of Cambodia looks relatively stable, this hub highlights the stability of the banking sector and lists the top 10 banking institutions in the Cambodia banking sector.


The National Bank of Cambodia

The Cambodia banking sector is supervised by the National Bank of Cambodia.commerical banks. The National Bank of Cambodia was first established in 1954 after the country gained independence as a French colony. The Bank closed in 1975 and then re-opened and operated under the name People's Bank of Kampuchea from 1979 to 1992. In 1992 the Cambodia's central bank changed back to the National Bank of Cambodia. NBC is currently led by His Excellency Chea Chanto who serves as governor of the central bank.

Cambodia Banking Sector

At the end of 2011, Cambodia's banking sector consisted of 31 commercial banks including 22 institutions incorporated locally and 9 foreign bank branches. The ASEAN nation's financial institutions in terms of total assets grew by a robust 24.39% from 2010 levels. Total number of deposit accounts increased 19% $1.27 million while the number of borrowers were up only a touch at 3%.

In a forward to the annual report, H.E. Chea Chanto, Governor of the National Bank of Cambodia reported a cautious optimism concerning his country's banking sector. His optimism was fueled by the significant growth in total assets brought about by injection of paid up capital, improved liquidity, as well as incremental increases in assets and profitability since 2009. The challenges ahead include (a) the fragile nature of the World economy due to the public debt crises in Europe and USA and (b) room for improvement inherent in a fledgling financial sector at the early stages of development.

In an October 2012 report, investigators from the Economist Intelligence Unit rate Cambodia's banking industry as relatively stable. Some analysts caution that some banks may be underreporting the amount of large loans to single borrowers. Still EIU notes that total foreign assets outpace total foreign liabilities which should keep the banking sector stable through for the short-term.

Acleda Bank

Acleda Bank is Cambodia's largest bank with $6.06 billion in assets as according to the National Bank of Cambodia's annual Supervisory Report for 2011. The bank boasts an industry dominating 234 branches spread throughout the country and accounts for 18.9% share of the Cambodia banking sector market. Acleda Bank total assets grew by 27.8% over 2010 figures.

Canadia Bank PLC

Canadia Bank Plc ended 2011 as Cambodia's second largest bank in terms of total assets. The National Bank of Cambodia listed Canadia Bank as managing $5.28 billion in assets. Accordingly, Canadia Bank accounted for 16.5% of market share in the Cambodia banking sector.

Cambodian Public Bank

According to the 2011 NBC Report, Cambodia Public Bank was the third largest bank in Cambodia. Cambodian Public Bank is the largest foreign-owned bank and held $4.09 billion at the end of 2011. Established by Malaysian investors, Cambodian Public Bank accounted for 12.8% of Cambodia banking sector.

ANZ Royal Bank

At the end of 2011, ANZ Royal Bank listed as Cambodia's fourth largest bank. ANZ Royal is a subsidiary of ANZ from Australia and New Zealand with 55% foreign-owned and 45% owned by a Cambodia's Royal Group led by Kith Meng. In all, ANZ Royal managed about $2.84 in assets and accounted for 8.9% of the Cambodia banking sector.

Bank of Investment and Development of Cambodia

Bank of Investment and Development of Cambodia (BIDC) was listed by the National Bank of Cambodia as the country's fifth largest banking institution. As of the end of 2011. BIDC managed $1.82 billion in total assets and accounted for 5.7% of the Cambodia banking sector.

Foreign Trade Bank of Cambodia

Foreign Trade Bank of Cambodia was listed by the National Bank of Cambodia as the nation's sixth largest banking institution. 100% Cambodia national owned, FTB managed a reported $1.65 billion and accounted for 5.2% of the banking sector market share.

Maybank Plc.

The National Bank of Cambodia reported Maybank as Cambodia's seventh largest banking institution. As of the end of 2011, Maybank handled $1.29 billion in total assets which accounted for 4.0% market share of the Cambodia banking sector. Maybank is 100% foreign-owned and has 11 branches (7 in Phnom Penh and 4 in provincial areas).

Union Commercial Bank Plc.

Union Commerical Bank Plc. was listed as the eighth largest bank in the Kingdom of Cambodia. According to the 2011 NBC report published April 2012, UCB handled $1.03 billion in total assets which accounted for 3.2% of the Cambodia banking sector market share. UCB assets grew nearly 25% overagainst its 2010 holdings. Union Commercial Bank offers an one-year CD at 5.5% which could be attractive in comparison to meager rates now offered in the United States and other developed markets around the world.

Bank of China Phnom Penh

Bank of China is a relatively new entry in the Cambodia banking sector. Bank of China opened its first branch in Cambodia May 9, 2011. This new entrant in the Cambodia banking industry ended 2011 as Cambodia's ninth largest bank. Bank of China has one branch located in Phnom Penh, is 100% foreign-owned, and managed nearly $834 million in total assets.

Advanced Bank of Asia Ltd.

Advanced Bank of Asia was listed by the National Bank of Cambodia as the ASEAN nation's 10th largest bank. At the end of 2011, ABA handled $818 million in total assets and accounted for approximately 2.5% of the Cambodia bankng sector market share. Advanced Bank of Asia is 100% foreign-owned.

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teaches12345 profile image

teaches12345 3 years ago

Cambodia has quite a lot of bank investments, as you say, the investors take a risk. It sounds like, from what I read, that the country has stability and would be worth the risk.

ecoggins profile image

ecoggins 3 years ago from Corona, California Author

Thank you teaches12345, Cambodia banking sector deposits have grown significantly since 2009. It seems that more investors are finding Cambodia to be worth trying out. I would be a little cautious. While the Central Bank board of directors seem to be making incremental improvements in governance and supervision, there are still challenges. If one decided to deposit funds in a Cambodian bank, I think it would be best to do so a little at a time.

For instance, Union Commercial Bank offers a 5.5% one-year CD. To check out the safety of such a deposit, an investor might try depositing the minimum required deposit for one year and see how it works out.

If the depositor is a foreigner, I would not invest too much at one time. Investing too much at one time could be a problem for a foreign investor. Cambodia has anti-money laundering laws which could be triggered if too much money is deposited too suddenly.

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