Golden Tree Co Ltd has been given the in-principle nod by the Cambodia Securities Exchange (CSX) to issue an approximately $3 million “green bond”, which observers note is on track to become the Kingdom’s first, turning a page on a new era for the local bourse and catalysing a new private-sector movement to support government commitments to slash carbon emissions.
Having greenlit the Golden Tree’s Bond Listing Eligibility Review Application, the CSX explained in an October 5 statement that to issue the bond on the bourse, the company must be cleared by the Securities and Exchange Regulator of Cambodia (SERC) to issue the debt security, and meet other applicable conditions.
CSX CEO Hong Sok Hour told The Post on October 6 that the green bond is planned to carry a coupon rate of seven per cent and a tenor of five years. He explained that the issuance process of this class of debt security would be largely the same as that for regular bonds, but with climate and environmental considerations added to the eligibility criteria.
“Eco-friendly and climate-forward investments are becoming popular, and that’s why Golden Tree Co Ltd and a number of other companies are looking for accreditation from experts among independent parties, such as international institutions like the World Bank.
“I believe that these securities could be more special than previously-available ones, in that it will be open to individual investors as well,” he said.
SERC director-general Sou Socheat recapped that the CSX’s in-principle approval was based on an evaluation by a team at the Asian Development Bank (ADB) of the green bond’s compliance with ASEAN standards and other eligibility requirements.
He confirmed that, to move forward with the issuance process, Golden Tree would need to be sanctioned by the SERC, following a meeting of the Council of the Non-Bank Financial Services Authority (NBFSA) – the securities regulator’s parent agency.
According to Sok Hour, if the SERC assessment goes smoothly and quickly, the bond may be issued as soon as next month.
Incorporated in October 2006, Phnom Penh-based Golden Tree is a veteran player in the capital’s office rental market, and famously owns the 12-storey Grade B VTrust Tower on Street 169 across the street from Bak Touk High School in Prampi Makara district’s Veal Vong commune.