Logo of Phnom Penh Post newspaper Phnom Penh Post - Canadia raised NPL provisions

Canadia raised NPL provisions

Canadia raised NPL provisions

CANADIA Bank reported improved results for the year-ended 2008, and also posted a substantial rise in provisions for nonperforming loans (NPLs) in its annual results published this week.

After-tax net profits rose almost 10 percent to US$22 million. Provisions for NPLs rose more than eightfold from $1.1 million to $9.2 million.

Vice President Dieter Billmeier said the stronger results were due to the bank broadening the sectors to which it lends - such as agriculture and services - and lending less to the construction industry.

"We are more prudent with that," he said of the bank's reduced exposure to the country's property sector. "Overall, we have put some reserves into nonperforming loans to be a safe haven for 2009."

Billmeier said the rise in NPLs - from less than half a percent of the company's loan book in 2007 to 2.35 percent last year - had come after discussions Canadia had with external auditors and on the advice of the National Bank of Cambodia, the country's central bank.

"We still feel very comfortable with that because we know where these loans are, and we are very confident that we will recover all of them," he said.

He confirmed that the portion of the loan book that was underperforming was construction and housing.

The International Monetary Fund (IMF) had noted in a review of the country's financial system earlier this year that some of the Kingdom's banks were under-reporting NPLs. The IMF called on the central bank to take a more proactive role in assessing NPLs. 

MOST VIEWED

  • Hong Kong firm done buying Coke Cambodia

    Swire Coca-Cola Ltd, a wholly-owned subsidiary of Hong Kong-listed Swire Pacific Ltd, on November 25 announced that it had completed the acquisition of The Coca-Cola Co’s bottling business in Cambodia, as part of its ambitions to expand into the Southeast Asian market. Swire Coca-Cola affirmed

  • Cambodia's Bokator now officially in World Heritage List

    UNESCO has officially inscribed Cambodia’s “Kun Lbokator”, commonly known as Bokator, on the World Heritage List, according to Minister of Culture and Fine Arts Phoeurng Sackona in her brief report to Prime Minister Hun Sen on the night of November 29. Her report, which was

  • NagaWorld union leader arrested at airport after Australia trip

    Chhim Sithar, head of the Labour Rights Supported Union of Khmer Employees at NagaWorld integrated casino resort, was arrested on November 26 at Phnom Penh International Airport and placed in pre-trial detention after returning from a 12-day trip to Australia. Phnom Penh Municipal Court Investigating Judge

  • Sub-Decree approves $30M for mine clearance

    The Cambodian government established the ‘Mine-Free Cambodia 2025 Foundation’, and released an initial budget of $30 million. Based on the progress of the foundation in 2023, 2024 and 2025, more funds will be added from the national budget and other sources. In a sub-decree signed by Prime Minister Hun Sen

  • Two senior GDP officials defect to CPP

    Two senior officials of the Grassroots Democratic Party (GDP) have asked to join the Cambodian People’s Party (CPP), after apparently failing to forge a political alliance in the run-up to the 2023 general election. Yang Saing Koma, chairman of the GDP board, and Lek Sothear,

  • Cambodia's poverty cut in half from 2009 to 2019: World Bank report

    A report published by the World Bank on November 28 states that Cambodia’s national poverty rate fell by almost half between 2009 and 2019, but the Covid-19 pandemic recently reversed some of the poverty reduction progress. Cambodia’s poverty rate dropped from 33.8 to 17.8 per cent over the 10