THE Bank of China (BOC) has been given in-principle approval by the National Bank of Cambodia to open a branch in Phnom Penh, becoming to first Chinese commercial bank to operate in the Kingdom, an NBC official said Thursday.

Thai Saphear, head of the NBC governor’s office, said a courtesy call from China’s new ambassador to Cambodia, Pan Guangxue, resulted in NBC Governor Chea Chanto giving the green light for the BOC to establish itself in Cambodia as early as the end of this year.

The Bank of China would come to facilitate trade and investment between Cambodia and China, Thai Saphear said.

“It’s a positive sign for the bank because they have the green light from the NBC already,” he said. “It’s up to the bank if it wants to open its branch soon or not, but if they want to open soon, it could be done this year.”

Following the in-principle approval, the bank has six months to prepare the required documentation to obtain the full operating licence, he said.

Figures from the Council for the Development of Cambodia show China-backed fixed asset investments in Cambodia were worth $4.37 billion in 2008 and $892.6 million last year. China-Cambodia trade figures were unavailable.

The Bank of China is the third foreign bank to receive NBC approval this year, following approval for the Bank of Agriculture and Rural Development of Vietnam (Agribank), and the CIMB Group of Malaysia.

In Channy, president and CEO of ACLEDA Bank, said Thursday that he is not concerned about tougher competition from more players, despite the market already having 27 commercial banks.

“We’re glad to welcome new players because they bring in new sources of capital, new technology in banking systems, and new experience,” he said.

According to the Bank of China’s financial report for the quarter ending March 31, net profit was $384 million at the close of the quarter – a 41.25 percent increase on the same period last year.

The bank’s total assets increased 11 percent during the quarter to $1.42 trillion, while total liabilities rose $137.8 billion to $1.34 trillion. Total deposits reached $1.07 trillion, a 10 percent increase during the quarter, while total loans rose 8 percent to $777.78 billion.