Phnom Penh Commercial Bank’s (PPCBank’s) net profit last year rose 40.5 per cent to $17.4 million, the company announced on Tuesday.
JB Financial Group’s Cambodian bank affiliate, PPCBank posted that its total assets were worth $89.9 billion – up 21.7 per cent year-on-year.
Total loans were $630 million last year, up 24.1 per cent compared to 2018.
PPCBank president Shin Chang-moo told Korea JoongAng Daily: “Growth has slowed down due to capital regulation and high competition in the commercial bank industry.”
“It is significant that we managed to pull off a strong profit by expanding our customer network and fortifying our digital service,” he said.
The bank said it lowered costs by delivering local capital instead of bringing them from South Korea.
“Unlike other Korean banks, PPCBank derived 100 per cent of its capital from the local market.
“Bringing low-interest capital from Korea and then lending it with high interest would lead to high-interest margins, but it would eventually face limits from regulations on foreign exchange.
“PPCBank lowered cost by securing low interest saving instead of high interest fixed deposit,” it said.
The National Bank of Cambodia (NBC) said as of the second quarter of last year, there were 45 commercial banks in Cambodia, 15 specialised banks, and 81 microfinance institutions, of which seven are microfinance deposit-taking institutions (MDIs).
It said there were also 254 rural credit operators, 15 leasing companies and 16 payment service providers.
Cambodia Securities Exchange market strategist and chief operating officer Ha Jong-weon told The Post on Monday that the strong and sustainable growth of the banking industry in Cambodia is the main factor attracting Korean investors.
“I wish to see more Korean investors investing not only in the banking sector but also in other potential areas such as agriculture and technology as the Royal Government of Cambodia is putting more effort in promoting and supporting these sectors for the long-term growth of the Cambodian economy,” Ha said.
The NBC’s Macroeconomic and Banking Progress 2019 Report and 2020 Outlook said deposits and outstanding loans rose sharply by 25 and 26 per cent respectively over 2018.
Outstanding loans reached $19.6 billion and deposits with Cambodia’s seven MDIs reached $22 billion last year.