The National Bank of Cambodia (NBC) has given the approval in principle to Malaysian-listed G Capital Bhd for the establishment of a full-fledged commercial bank under the name “Oriental Bank Plc” in the Kingdom.

This comes with an approved capital of $100 million, G Capital said in a statement on December 8.

It said it has entered into a heads-of-agreement contract with local firm E S Packaging Co Ltd and Public Bank Bhd’s former Indo-China operations regional head Phan Ying Tong to collaborate on the venture, Malaysian media outlet The Edge Markets reported.

In a filing to the Bursa Malaysia, G Capital said: “Specifically, the heads of agreement has been structured to outline the preliminary undertakings and obligations of the parties with a view to enter into legally binding definitive agreement between the parties to establish ‘Oriental Bank Plc’.”

G Capital said it will hold no less than 20 per cent of the new company’s issued shares, while Phan will have a 51 per cent stake and E S Packaging a 20 per cent stake, as reported by The Edge.

The balance nine per cent interest will be held by an additional investor to be named by Phan or E S Packaging, it said.

With the NBC’s approval-in-principle, Oriental Bank can now be formally registered with the Ministry of Commerce, it added.

According to the group, the Kingdom’s financial health has seen steady growth, while its banking sector has surfaced as one of the most robust industries committed to making a healthy profit.

“G Capital envisages that in the long term, its equity participation in the banking sector will significantly strengthen its financial standing and broaden its presence throughout the region,” The Edge quoted it as saying.

Public Bank Group on December 9 issued a statement denying involvement in the venture and clarifying that Phan had resigned from all of his positions at the bank and was acting on his own accord.

“We wish to clarify that the Public Bank Group has no involvement at all in the said joint venture.

“The Public Bank Group wishes to further clarify that Datuk Phan Ying Tong had resigned from all his positions within the Public Bank Group and is no longer the regional head of Public Bank’s Indo-China operation,” Public Bank Group said, using the Malay title “Datuk” commonly used in Malaysia and Brunei.

“Following Datuk Phan’s resignation, he is no longer authorised to represent the Public Bank Group in any matters,” it said.

Cambodia Post Bank Plc CEO Toch Chaochek told The Post on December 9 that G Capital’s foray into Cambodia would provide borrowers with a much-needed new source of capital in the Kingdom’s still-budding market.

He said: “The more banks are set up in Cambodia, the more options there will be for consumers to choose which is the best fit for their needs.”

Formerly known as Gunung Capital, G Capital is mainly involved in the provision of charter services with a fleet of land-based passenger transportation assets and specialty vehicles, according to The Edge.

On the Bursa Malaysia, shares of G Capital rose one sen (0.246 US cents) or 0.76 per cent on December 8 to close at 1.33 ringgit ($0.33), with a market capitalisation of 404.04 million ringgit.

But on December 9, the share price sank 40 sen or 29.70 per cent to close at 0.94 ringgit for a market capitalisation of 285.17 million ringgit with 62.24 million shares traded.