Two of Cambodia’s leading commercial banks – locally owned Acleda Bank Plc (Acleda) and South Korean-owned Phnom Penh Commercial Bank Plc (PPCBank) – have been granted listing eligibility from the Cambodia Securities Exchange (CSX).
This paves the way for the banks to move forward with plans to be publicly traded.
CSX said the banks were approved after the conclusion of its equity securities listing eligibility review on Wednesday.
As a result, Acleda is the first commercial bank to receive principle approval for its initial public offering (IPO), with PPCBank the first South Korean commercial bank to achieve the same benchmark.
The banks are still required to “meet further CSX listing requirements”, the bourse said.
Acleda received a letter from the National Bank of Cambodia (NBC) on November 26 allowing it to proceed with its plans for an initial public offering (IPO) – triggering the equity securities listing eligibility review.
“Our shareholders have unanimously agreed that the bank should become public to diversify our sources of funding and utilise the Cambodian capital market for our future growth.
“On this occasion, we would like to inform our customers and the public that Acleda Bank Plc’s shares will be available for investment after getting further approvals from the CSX and the SECC [Securities Exchange Commission of Cambodia],” said Acleda president and group managing director In Channy.
Chief operations officer of the CSX Ha Jong Weon told The Post that the banks were going public and issuing bonds to “enlarge the capacity of the institutions, expand operations and strengthen competitiveness”.
“The two commercial banks are seeking competitive advantage and enhanced reputations by listing themselves on the securities market. Other banks are also expected to follow their lead,” Ha said.
There will be more quality products to invest in addition to the existing five stocks and three bonds on offer, he added.
“The equities and bonds issued … will not only enhance the size and quality of the securities market, but also act as a benchmark for the subsequent participation in the market.
“I believe that the banking industry is well-known to the Cambodian people in terms of its profitability, accountability, transparency and legal compliance.
“The two commercial banks will attract a lot of interest from investors and their success will serve as another good example to attract other companies, especially other commercial banks, to queue for listing.
“The banking industry in South Korea has been closely related to the securities market. From now on, they will begin to diversify through investing in the securities market to maximise revenue,” Ha said.
PPCBank already offers corporate bonds in Khmer riel through the CSX, he added.
The CSX has raised the some $151 million in capital from securities and corporate bond trading so far this year – an increase of around 26 per cent from the $120 million ending 2018, said SECC data released last week.