THE Cambodia Securities Exchange will launch on July 11 though trading may not begin until months later, according to a letter from the Ministry of Economy and Finance.
The Ministry said it “plans to inaugurate the Cambodia Securities Exchange … on July 11, 2011, and based on the estimated progress of related work the first securities trading will begin towards the end of 2011.”
The decision regarding the two dates was based on the experience of other countries, which launched their market operator first in order to allow them time to prepare for securities trading, the ministry said in the letter, which was dated May 26 and addressed as a public notice.
The letter also stated related companies which had been accredited by the Securities and Exchange Commission of Cambodia for a role such as securities firms or cash settlement agents, were “strongly encouraged” to push forward with their applications.
Cambodian officials said last year the exchange would launch in July 2011 “at any cost,” though officials from three state-owned enterprises slated to list say they will not be ready to trade within two months.
Observers said the announcement to inaugurate the CSX was an important signal that Cambodia was committed to opening the exchange, even if trading did not begin until later this year.
“It’s been delayed quite a bit, so people need to know it’s a reality,” said Leopard Capital Managing Partner Scott Lewis.
“If they just didn’t have anything, they’d risk credibility,” he said, adding that the move was a “confidence-building measure.”
Also, the Ministry was calling on companies that had considered listing to start the process, Lewis said.
None of the three state-owned enterprises tapped to list on the bourse will be ready for trading until later this year, company officials told The Post last week.
Ek Sonn Chan, Director General of Phnom Penh Water Supply Authority, said he hoped his firm would be ready by November. In the meantime, PPWSA was working to meet the CSX’s listing requirements.
“What’s important for us is that we are selecting an accounting firm, independent auditor and law firm to comply with international accounting standards,” he said.
Telecom Cambodia Director General Lao Sareoun said his company was in a similar situation to PPWSA.
“We have a lot of work to do at the moment, like choosing an accounting firm, independent auditor and law firms, which cost us a lot,” he said last week, adding the board of directors would meet soon to decide on a budget.
“We’re trying to finish our internal work by November. But if we can’t finish by then, we’ll delay trading one more month,” he said.
Tong Yang Securities (Cambodia) is advising PPWSA and Telecom Cambodia on their public offerings. Managing Director Han Kyung-tae said last week his firm was working hard to meet the government’s deadline, though expectations were high.
“It is possible, but it is not going to be easy,” he said.
Sihanoukville Autonomous Port needs more time to prepare its listing as well, according to Japanese-owned SBI Phnom Penh Securities.
Director Jeremy Ha said the company needed another three to four months to bring it in line with accepted accounting standards.
“We are making progress, but I think it will take some time to complete things,” he said.
Ming Bankosal, Director General of the Securities and Exchange Commission of Cambodia, said last week that he was waiting on documents from firms planning to list.
He said he was expecting companies to submit their prospectuses, which is a required step in the listing process. At least two months are needed for approval of those prospectuses before a stock can start trading, he said.
“However, so far we haven’t received any.”
Officials at the Ministry of Economy and Finance and the Cambodia Securities Exchange could not be reached for comment yesterday.