Prasac (CSX:PRA23A) says Q4 delay ‘nothing to do with technical default’ as portfolio hits $3B+
PRASAC Microfinance Institution Plc. ((CSX:PRA23A) has informed the investors and public that the release date of the fourth quarterly report 2020 will be extended up to 31 March 2021 mainly due to finalization of the COVID-19 impact on the expected credit loss calculation assessment which requires final validation of Khmer and foreign experts.
With the above situation, PRASAC Microfinance Institution Plc. and the external auditor need additional time for the finalization of the fourth quarterly report 2020, they added.
Speaking to Cambodia Investment Review the Company said that they delay has nothing to do with any covenant or technical default as PRASAC already fully received the approval from all lenders for waiver and amendment the financial covenants.
The answer was in response to questions about last years financial concerns of a “technical default” was made after PRASAC was unable to meet its obligations to its lenders because of the economic effect of the COVID-19 pandemic during the first half of the year.
The concerns were outlined in the company’s half-yearly financials submitted to the local securities exchange and reported that the company “had been considered as being in default of more than $800 million in liabilities to funders due to the quality of its assets”.
According to the Company as of December Prasac’s loan portfolio growth about 21.17% with amount from $2.501 billion in 2019 to $3.030 billion in 2020 and deposit growth about 15.25% with amount from $1.788 billion to $2.061 billion with total asset growth about 16.95% from $3.110 billion to $3.637 billion
They delay is the second time the Company has missed its interim deadline for the 2020 year when the Company announced to the investors and public that the second quarterly report 2020 will be extended in releasing this report until on 30 September 2020 due to the following reasons:
1. this is the first report of PRASAC Microfinance Institution Plc. after PRASAC Microfinance Institution Plc. is officially listed in Cambodia Securities Exchange.
2. financial statement of second quarter 2020 of PRASAC Microfinance Institution Plc. in accordance with Cambodian International Financial Reporting Standards, which is prepared and reviewed by the independent auditor Ernst & Young (Cambodia) Ltd., are complicated and need plenty of resources and time.
PRASAC Microfinance Institution Plc officially launched the largest ever corporate bonds listing on the Cambodian Stock Exchange (CSX) in May last year, raising 127.2 billion riel ($31.8 million) from just three investors – Malaysia’s Hong Leong Bank, Prudential Insurance and Shinhan Bank.
All bonds were fully guaranteed by the Asian Development Bank’s trust fund’s Credit Guarantee and Investment Facility (CGIF).
The 1,272,000 bonds on offer were fully subscribed on April 22, 2020.
KB Kookmin Bank, a leading commercial bank in South Korea, successfully acquired 70 percent of PRASAC Microfinance on April 10, 2020.
According to the Company It allows PRASAC to become one of the subsidiaries of KB Financial Group. KB Kookmin also plans to incorporate the company as a wholly owned subsidiary when it acquires additional 30% of remaining shares in the future. Cambodia Investment Review