Logo of Phnom Penh Post newspaper Phnom Penh Post - Kingdom’s first corporate bonds in sight after approval from NBC

Kingdom’s first corporate bonds in sight after approval from NBC

Content image - Phnom Penh Post
A branch of Hattha Kaksekar Limited on Phnom Penh’s Street 271. Pha Lina

Kingdom’s first corporate bonds in sight after approval from NBC

Hattha Kaksekar Limited (HKL) is set to become the first company to issue corporate bonds in the Kingdom, and it is doing so to the tune of 80 billion riel ($20 million).

The firm has received approval from the National Bank of Cambodia (NBC) for the move.

HKL announced on Friday that the Cambodian microfinance firm plans to initially offer $20 million in bonds, and increase this by another $10 million if there is high demand.

The bonds will reach maturity in three years with a coupon rate from 7.5 to 8.5 per cent per year.

President and CEO of HKL, Hout Ieng Tong, said: “HKL is going to use the net proceeds [from the bonds] for funding growth of our lending business, working capital and general corporate purposes.

“The proceeds from HKL’s Khmer riel bond issuance will also support local micro-, small- and medium-sized enterprises,” he said.

After obtaining the NBC’s green light, HKL will submit documents to the Securities and Exchange Commission of Cambodia (SECC) for approval. Its approval forms for listing on the Cambodia Securities Exchange (CSX) are currently pending.

SBI Royal Securities is a financial adviser and underwriter for HKL’s bonds issuance project. The tentative subscription period for the bonds will be from September 26 to October 1.

In a statement in May, the International Finance Corporation (IFC), a World Bank Group subsidiary focusing on private-sector investment in developing countries, disclosed a proposal to invest up to $20 million in riel bonds issued by HKL.

In the statement, the IFC said it would leverage its global experience in local bond issuances to help HKL issue the first corporate bonds in the country.

Seng Chan Thoeun, managing director at SBI, told The Post that the bonds will give local investors more options, as up to now only stocks have been available on the CSX.

“Bonds can provide a stable source of low-cost funding. This is a very important step in furthering the development of the Cambodian capital market,” he said, adding that economic benefits will begin to stack up as more companies begin the process of issuing bonds.

HKL is the third largest microfinance deposit-taking institution (MDI) in the country in terms of assets, loan portfolio and net profit. It was ranked second in the Kingdom in terms of customer deposits as of the end of last year.

The company’s gross loan portfolio and customer deposits stood at $576.8 million and $367.4 million, respectively, as of December 31 last year.

At that time, their total assets stood at $69 million and net profit was up to $15.3 million.

MOST VIEWED

  • Would you like fries with that? US burger chain makes Phnom Penh debut

    California-based The Habit Burger Grill restaurant chain is all set to serve up a delicious array of charbroiled burgers and sides at its newest international location in the centre of Phnom Penh. The Habit is “renowned for its award-winning Charburgers grilled over an open flame,

  • Banteay Meanchey flood victims receive aid

    Prime Minister Hun Sen on Wednesday provided aid to more than 10,000 families affected by flooding in Banteay Meanchey province’s Mongkol Borei district and offered his condolences to the 18 victims who drowned in the province over the past week. He said flooding had occured in

  • Angkor provides ‘valuable’ water storage

    The Apsara National Authority (ANA) has stored millions of cubic metres of water at reservoirs in the Angkor area after Cambodia experienced a series of rainstorms over the last few days. The storing of the water, besides serving temple conservation, will also be used to

  • PM urges caution as Polish man tests positive for Covid

    The Ministry of Health on Wednesday reported that a 47-year-old Polish man tested positive for Covid-19 after arriving in Cambodia on Monday. There are a total of six Covid-19 patients currently in the country, all of whom are being treated at the Khmer-Soviet Friendship Hospital

  • Banteay Meanchey floods kill one more as death toll reaches 15

    As floodwaters start to recede in Pursat, Battambang and Pailin provinces and Phnom Penh, Banteay Meanchey continues to bear the brunt as one more person was killed on Monday, bringing the total number of flood-related deaths to 15 in the province this month. Banteay Meanchey provincial

  • Serving coffee with a side of robots

    The eye-catching glass building surrounded by greenery at the intersection of Streets 371 and 2002 in Phnom Penh’s Sen Sok district is more than just another coffee shop where you can while away a few hours. UrHobby House cafe is filled with robots and characters from