International Business Chamber moves to Phnom Penh Tower

Members of the International Business Chamber of Cambodia pose for a group photograph at the company’s office in Phnom Penh yesterday. Photograph: Pha Lina/Phnom Penh Post

The International Business Chamber of Cambodia opened a new office yesterday on the 12th floor of the Phnom Penh Tower.

IBC Chairman Brett Sciaroni said the move demonstrated a trend of business associations giving more visibility and presence for companies that operate in Cambodia. 

“This is one more indication of the professionalisation of business associations in Cambodia,” he said.

“As the IBC has increased its range of activities and its commitment to the public-private dialogue process in Cambodia, we needed more staff and facilities. Phnom Penh Tower is a leading address in Phnom Penh. We chose this location to show the significance of the IBC as a leading business association and we’re not the only business association that’s located here,” he said.

IBC executive committee member John Brinsden said the location reflected what the members deserved.

“This is a dream come true and the reason is the IBC over many years has had loyal members and we on the executive committee felt very concerned that we weren’t really giving our members the prestigious location and facilities they deserved.”

The IBC has more than 80 members, organised by company, and the people who attend are representative of those member companies, including many global brand names.

“This is something we’ve been thinking about for a long time: a prestigious office to serve our members. We provide our members and potential investors in Cambodia with a chance to meet in one place. 

We’re here with an address; we’re in the yellow pages. Visiting foreign investors, people having a look around Cambodia can come and talk to our staff and get some basic information and contacts they can use,” Brinsden said. 

IBC Vice Chairman In Channy, CEO of ACLEDA Bank, said the new location was a place where members could meet and get information. The IBC’s new executive director, Audrey Tugendhat, who runs the office on a day-to-day basis, said members of the public could visit and receive updates on the IBC social events calendar.

“For instance at the next regular general meeting which will take place at lunchtime on July 4 atRaffles Hotel, our members can bring potential candidates for membership.”

Phnom Penh Water Supply Authority shuffle no surprise

Officials and securities firms yesterday showed little distress at the imminent retirement of Ek Sonn Chan, the man credited with straightening out and preparing the capital’s public water utility for its initial public offering in April.

A letter from the Ministry of Industry, Mines and Energy (MIME) obtained yesterday by the Post said the Phnom Penh Water Supply Authority general director will leave his position on July 1 after a nearly 20-year tenure. 

Sim Sitha, the director of Sihanouk Water Supply, will replace him.

One insider compared the changing of the guard at PPWSA to the death of Apple’s Steve Jobs.

“All changes here will slightly impact the price of the company. You know that when Steve Jobs passed away, it had some impact on the price of Apple. So I think it’s the same here. I would say the fundamentals of PPWSA are very good so the price will be going up and the investors will understand,” said Min Kyoung-hoon, deputy director general of the Cambodia Securities Exchange.

“It might have an impact [on PPWSA’s share price] or it might not.”

The MIME letter, signed by minister Suy Sem, painted the general director-designate as a highly trained, multilingual professional. It also said the move was necessary to ensure the success of the company.

Svay Hay, director of Acleda Brokerage Firms, said Ek Sonn Chan’s replacement was a matter of age, and would enhance PPWSA’s productivity.

“The change will not cause any crisis or problem. It’s regarding the old age of the general director. This does not only happen in government institutions, but also in private companies. They still set the age for retirement,” he said.

Ek Sonn Chan is in his early 60s. He will become an under secretary of state at the ministry, according to the letter.

The shuffle, which insiders said would be officially announced today, did not represent internal conflict within the company and the ministry, Tan Sokchea, an official at the ministry’s clean water department, said yesterday.

“It’s not relevant to any kind of corruption. Normally, when we come to the age of retirement, we should follow because now the government is really strict about that,” he said.

Tan Sokchea also recognised Ek Sonn Chan’s contribution to the company. “Frankly speaking, he possessed excellent leadership.” 
(source from Phnom Penh Post, 

Friday, 29 June 2012

May Kunmakara)

MFIs still seeing significant growth

Outstanding loans and deposits in 28 of Cambodia’s microfinance institutions rose between 30 and 40 per cent year-on-year in 2011, official data from the Cambodian Microfinance Association indicated.

The CMA’s data showed outstanding loans rose 41.5 per cent from US$916.3 million with 1.3 million borrowers in 2011, compared to $647.8 million with 1.22 million borrowers a year earlier. 

Deposits grew by 32 per cent to $1.26 billion with 1.1 million depositors, compared to $952.2 million with 36,776 borrowers in 2010. MFIs in the Kingdom first began to take deposits in early 2010. 

Non-performing loans (NPL) declined from 1.3 per cent of the loan total to 0.4 per cent. Officials and insiders said a strong macro-economy performance and clear regulations were responsible for the shift.

National Bank of Cambodia director general and spokeswoman Ngoun Sokha recognised the favourable direction the economy was heading, especially in the agricultural sector, which she believed was responsible for the rising demand for loans.

“The government supports the agricultural sector, especially the export of milled rice. So we promoted the adoption of MFI loans for agriculture and actually received a lot of growth in that area, adding up to more than 50 per cent of all loans,” she said. 

Bun Mony, director of CMA and chairman of Sathapana Microfinance, told the Post that loan portfolios at Sathapana rose about 65 per cent to $94.6 million compared to $57 million in 2010. The number of borrowers grew from from 43,565 to 55,001.

“There was a high demand for loans as business activities continue to grow, and we don’t even seem to have any problems with repayment,” he said, adding that the NPL rate declined to from 0.93 per cent to 0.22 last year.

Sathapana provides loans to all sectors, with 40 per cent going to retail and small businesses, and more than 20 per cent to the agricultural sector.

The country’s biggest MFI, Prassac Microfinance, reported that by December 2011 its gross loan portfolio was $151 million, an increase of 43.6 per cent, with active borrowers increasing 10.9 per cent to 125,127.

“In general, I think that the industry performed well last year because all MFIs grew their portfolios while the NPL rate decreased,” Sim Senacheert, president and CEO of Prassac, said.

Prassac loans to the agricultural sector accounted for 33 per cent of its total portfolio, with trading and service making up 47 per cent.

Hout Ieng Tong, general director of Hattha Kaksekar Microfinance, reported that loan portfolios rose 70 per cent to $75 million with 62,703 borrowers, from $44 million with 47,952 borrowers the year pior. 

He added that NPL declined from 0.9 to 0.07 per cent, and that agricultural loans accounted for 35 per cent of total stocks at his compay. Sathapana Microfinance’s total deposits rose 129.4 per cent from $39 million to $17 million, while Hattha Kaksekar’s total deposits grew more than 160 percent to reach $15.78 million compared with only $5 million the year before. Prassac reported smaller increases, as its operations just began in mid-2011.

The successes are tempered, however, by the uncertain economical fates of the EU and US, where much of the industry gets its primary funding. “We are a bit worried,” said Bun Mony. 

“We see the EU in a crisis, and think there could be some slight impact on us, specifically regarding investments.”

Ngoun Sokha suggested a solution, saying, “We try to teach MFIs good governance, and to strengthen their internal capacity for infrastructure, so that they will be able to easily seek a source of funds domestically rather than just looking abroad.”