Logo of Phnom Penh Post newspaper Phnom Penh Post - Krungsri expects more growth from Cambodian MFI

Krungsri expects more growth from Cambodian MFI

A branch of microlender Hattha Kaksekar Limited on Phnom Penh's Street 271, earlier this year.
A branch of microlender Hattha Kaksekar Limited on Phnom Penh's Street 271, earlier this year. Pha Lina

Krungsri expects more growth from Cambodian MFI

Thailand's Bank of Ayudhya released its first financial statement since completing its acquisition of Cambodian microlender Hattha Kaksekar Ltd (HKL) last month, showing a quarterly net profit increase of 10.6 percent from a year earlier.

While Bank of Ayudhya, Thailand’s fifth-largest commercial lender, did not fully include the acquisition of HKL in its revenue calculations, it noted in Friday’s filing that the purchase of a 100 percent share in the Cambodian microfinance institution (MFI) would likely boost its performance for the rest of the year.

Bank of Ayudhya, also known as Krungsri Bank, acquired HKL in September for upwards of $140 million, though the final price of the acquisition has not yet been made public.

Noriaki Goto, the bank’s president and CEO, said in a statement that the finalised acquisition of HKL was “another key milestone” for the Thai bank as it expands its operations throughout ASEAN.

“With the successful acquisition of HKL, a meaningful regional traction is being realised. Krungsri now has a local presence in Cambodia, Laos and Myanmar,” he said. “Krungsri revises loan growth target upward from 5 to 6 percent to 8 to 9 percent including consolidated loans from HKL,” he said.

For the first nine months of the year, Bank of Ayudhya’s loan portfolio grew by 7.7 percent, of which HKL’s acquisition in the final month of the reporting period accounted for 1.1 percent. The bank attributed the majority of its growth to the expansion of auto, mortgage, credit card and personal loan products.

Third-quarter profits were recorded at nearly $122 million, while non-performing loans fell to 2.1 percent of total loans. Bank of Ayudhya, itself part of the Japanese-based Mitsubishi UFJ Financial Group, holds over $50 billion in assets.

HKL is Cambodia’s fourth-largest microfinance institution, with 150 branches and $446 million in assets, according to its 2015 annual report. The lender had a $363.5 million loan portfolio, with $236.4 million in deposits last year, and posted 37 percent annual net profit growth.

MOST VIEWED

  • NY sisters inspired by Khmer heritage

    Growing up in Brooklyn, New York, Cambodian-American sisters Edo and Eyen Chorm have always felt a deep affinity for their Cambodian heritage and roots. When the pair launched their own EdoEyen namesake jewellery brand in June, 2020, they leaned heavily into designs inspired by ancient Khmer

  • Schools drawn into Manet degree row

    Prime Minister Hun Sen stepped into the Hun Manet-Sam Rainsy war of words over the validity of Manet’s degree from the US Military Academy at West Point, set off by Rainsy’s claims that Manet had received a “second-class degree” or “honorary degree”. Hun

  • Cambodia records first Omicron community case

    The Ministry of Health on January 9 reported 30 new Covid-19 cases, 29 of which were imported and all were confirmed to be the Omicron variant. The ministry also reported 11 recoveries and no new deaths. Earlier on January 9, the ministry also announced that it had detected the Kingdom's

  • The effects of the USD interest rate hike on Cambodian economy

    Experts weigh in on the effect of a potential interest rate expansion by the US Federal Reserve on a highly dollarised Cambodia Anticipation of the US Federal Reserve’s interest rate hike in March is putting developing economies on edge, a recent blog post by

  • PM eyes Myanmar peace troika

    Prime Minister Hun Sen has suggested that ASEAN member states establish a tripartite committee or diplomatic troika consisting of representatives from Cambodia, Brunei and Indonesia that would be tasked with mediating a ceasefire in Myanmar. The premier also requested that Nippon Foundation chairman Yohei Sasakawa

  • Kampot tourism quay ‘90% done’

    Construction on Kampot International Tourism Port – a 4ha quay in Teuk Chhou district about 6km west of Kampot town – has fallen off track, reaching 90 per cent completion, according to a senior Ministry of Tourism official last week. The project is now planned to be finished