Acleda Bank has signed a $US10 million loan agreement with Proparco, a development finance institution held in part by the Agence Francaise de Développement (AFD), according to a statement released on Wednesday.
With the Kingdom’s financial sector expanding rapidly and a growing demand for banking and financial services among Cambodians, the loan seeks to support the growth of the commercial bank’s loan portfolio, according to the release.
“We are happy to support a first-class actor like Acleda Bank in pursuing its business model of providing financial services to all segments of the community,” Proparco deputy CEO Marie-Hélène Loison said in the release.
“Proparco’s loan will contribute to the financial integration of disadvantaged members of the population, while also growing the credit offer for small and medium-sized enterprises.”
Acleda president and chief executive In Channy said the money was needed to finance long-term projects such as housing loans.
In Cambodia’s commercial banking sector, credit grew by 34 per cent in 2011 while deposits increased by 20 per cent, the release says.
The $10 million loan, which has a five-year maturity, and is the second such support Acleda has received from the French institution.
In 2009, Proparco granted a $10 million credit facility to Acleda, the statement says.
According to Acleda executive vice-president Cheam Teang, $10 million is not enough to provide loans for micro-, small and medium- sized businesses.
“The loan demand in Cambodia is increasing,” Teang said. “We need more than $10 million. We need to ensure we have enough to pay the loans.”
Teang said that compared with Acleda’s main assets and the more than 200 offices nation-wide the money would be divided among, the amount was small. According to him, the commercial bank has also received loans from other institutions such as the International Finance Corporation.
Seng Takakneary, president of the Cambodia Women Entrepreneurs Association, agrees that the demand for loans among Cambodians is increasing.
“Everyone wants to do business,” Takaneary said, adding that her organisation also aimed to provide loans in the future.
Proparco, founded in 1977, is jointly held by AFD and private shareholders from bothy developed and developing nations. It invests in developing countries to enhance growth, support sustainable development and reach the United Nations’ Millennium Development Goals.
The Acleda loan will take the number of Proparco’s interventions in the Cambodian financial sector to six.
Acleda was established in 1993 as an NGO for micro-financing. In 2003, it received a licence from the National Bank of Cambodia to become a commercial bank. Operating in all provinces of Cambodia, Acleda has 237 offices that target micro-, small and medium-sized entrepreneurs.
To contact the reporter on this story: Anne Renzenbrink at [email protected]