The Ministry of Economy and Finance plans to raise approximately 28 billion riel ($6.8 million) through the issuance of sovereign bonds via the National Bank of Cambodia’s (NBC) online trading platform (NBCP), aiming to garner additional funds from the capital market for public investments. 

At the Cambodia Securities Exchange (CSX) on December 7, the ministry announced that it will issue 28,000 bond units, each with a nominal value of one million riel ($242.82) and a maturity period of two years, from 2023-2025. The bonds will carry a coupon rate of 4% per annum, with semi-annual coupon payments.

Kim Sophanita, director of the Market Operations Department at CSX, noted that the government’s bond issuance signifies progress in the capital market, offering a new funding source for both public and private sectors to bolster their investments or businesses.

“Cambodia’s capital market has advanced to another stage of development with more complete and adequate infrastructure. The government bond market is crucial and beneficial to every stakeholder,” she said. 

“It provides an additional financing option for the government, more investment choices for institutional investors, an extra financial instrument for effective monetary policy management, a benchmark for every financial product and more,” she added.

In mid-January, the ministry announced plans to sell a sovereign bond worth 813 billion riel ($192.3 million) in 2023, to be issued in several tranches. 

The statement further detailed that the bond would be available in one-, two-, three-, five-, 10- and 15-year terms, with new issuances every four weeks. 

It specified that a total of 200 billion riel ($48.54 million) worth of one-year and three-year bonds would be auctioned in three batches and a total of 120 billion riel ($29.12 million) worth of two-year bonds in two lots. Forty billion riel ($9.7 million) worth of 10- and 15-year bonds will be auctioned in two batches each. 

The statement also noted that the 213 billion riel ($51.7 million) five-year tenor tranche would be issued by private placement.