CSX-Listed Microfinance Institutions Record a Very Strong Annual Growth

CSX-Listed Microfinance Institutions Record a Very Strong Annual Growth

Both Cambodia Securities Exchange-listed microfinance institutions Hattha Kaksekar Ltd and LOLC Cambodia Plc announced strong performance growth last year, according to their respective annual reports shared on the local bourse.

LOLC Cambodia posted a 61 percent growth for its loan portfolio and 95 percent growth in its deposit balances, including a 25 percent increase in borrowers and an 86 percent rise in depositors. In addition, the company said it experienced a 10.6 percent market share gain. LOLC said it is looking to grow through a strategy of improving client retention rates, expanding the number of borrowers and improving loan quality by focusing on client repayment ability.

Sok Voeun, chief executive officer of LOLC Cambodia, said that “The fast growth of our loan portfolio and deposit balance
has reflected that LOLC Cambodia is a trustworthy microfinance institution in the market, both in terms of guaranteeing client protection and providing competitive and innovative deposit and loan products.”

“In order to support the business and our new product development, LOLC Cambodia has been investing in digital banking projects that will improve customer services and increase efficiencies such as ATMs, mobile banking applications and third-party connections,” he added.

Hout leng Tong, president, and chief executive officer of Hattha Kaksekar Ltd (HKL) said, his company is planning to introduce new products this year while announcing a plan to transform the company from a microfinance deposit-taking institutions into a commercial bank.

In October last year, the National Bank of Cambodia approved the company’s request for increasing its share capital from $75 million to $115 million. “This additional amount enables us to strengthen our capital and it will allow us to prepare for the transformation to become a commercial bank in the Cambodian financial market,” Hout said.

According to its annual report, HKL’s loan portfolio reached more than $1 billion and the deposit balance recorded $599 million, the soon-to-be commercial bank currently has 177 branches and 137 ATMs nationwide.

In 2018 HKL was the first microfinance institution in Cambodia to issue corporate bonds on the local bourse, issuing 1.2 million bonds worth 120 billion riel ($30 million), with an interest rate of 8.5 percent per annum. In 2019, LOLC Cambodia officially issued corporate bonds on the Cambodia Securities Exchange, issuing two types of bonds a foreign exchange-indexed bond and a fixed-coupon bond, successfully raising 80 billion riel ($20 million). Both institutions stated that the bonds were issued to assist in the expansion of their business operations. Khmer Times