Malaysia-based Hong Leong Bank, a subsidiary of Hong Leong Financial Group Berhad, is planning to open a branch in Cambodia sometime this year, which would make it the fourth Malaysian bank and the 33rd commercial bank in Cambodia’s crowded banking industry.
Ngoun Sokha, director general of the National Bank of Cambodia (NBC), confirmed yesterday that the bank had applied for a licence last year.
“They applied about a year ago, but it got approval in principle last month,” she said. “We are checking and working on their business plan because we want to make sure whether they are eligible with our requirements or not.
“I cannot say when we are going to approve them because we need to check more details about their business plan. If there is something that doesn’t meet our requirement, we will inform them to do it.”
“Right now, we are considering to approve them, but it will be within this year,” she said.
Hong Leong Bank has been operating in Malaysia for more than 100 years. In 2011, Hong Leong Bank completed a merger with EON Bank Group.
The merger effectively transformed the bank into a banking group with an expanded network of 329 branches nationwide.
Hong Leong Bank has branches in Singapore and Hong Kong and a wholly owned subsidiary in Vietnam.
In China, the bank has a 20 per cent shareholding in Bank of Chengdu Co Ltd, Sichuan, and a consumer finance joint venture.
Sokha said the growing ease of trade and investment from Malaysia to Cambodia is the main reason for the growing number of Malaysian banks.
“The trade and investment relations with Malaysia are on a sharp growth, so that the presence of the new Malaysian bank is to fulfil the increase in demand from Malaysian investors or businessmen here. I think, although we already have three banks from Malaysia, the [Hong Leong Bank] presence in this market is still good because we have a lot room for them to grow,” he said.
According to Han Peng Kwang, general manager of HwangDBS Commercial Bank, this would increase competition in the banking industry in Cambodia.
“I am concerned that more banks will result in staff pinching becoming more prevalent, which will increase the operation costs of the overall banking industry,” he said.
To contact the reporter on this story: May Kunmakara at [email protected]