Taiwan's E.SUN Commercial Bank plans to purchase the remaining 25 per cent stake in Union Commercial Bank (UCB), giving it full ownership of the small Cambodian lender.

The $39.9-million acquisition aims “to broaden E.SUN’s service network in ASEAN countries and thereby strengthen the bank’s competitive advantage for its long-term development,” E.SUN Bank’s listed parent company, E.SUN Financial Holding Co, said in a filing to Taiwan’s securities exchange on Wednesday.

“The acquisition will secure our position in Southeast Asian markets and tap into rapid economic growth in Cambodia and adjacent regions,” Taiwanese media quoted E.SUN Bank’s president Joseph Huang as saying.

Founded in 1994, UCB has 11 branches in Cambodia with over 450 staff. The bank had $671 million in total assets at the end of 2015, with $438 million in deposits and $428 million in outstanding loans, according to National Bank of Cambodia (NBC) data.

In 2013, E.SUN Bank acquired a 70-per cent stake in UCB for $69.3 million. It has since bought out one of the bank’s Cambodian shareholders to increase its stake to 75 per cent.

UCB chairman Yum Sui Sang said yesterday that he agreed to sell his 20-per cent stake in the bank to E.SUN Bank. Records show another director, Yum Ka Yee (Simon), holds the remaining 5 per cent stake.

“We have agreed [to sell],” Sui Sang said, putting the transaction price at “close to $40 million”.

He said the transaction would require approval from banking regulators in Cambodia and Taiwan, though the NBC has already given the nod.NBC officials could not be reached yesterday to confirm its approval.

According to UCB data, the bank has $37.5 million in paid-up capital, or about half the threshold of the central bank’s recently revised minimum capital requirement.

Sui Sang said E.SUN Bank would have little trouble raising the necessary capital to meet the requirement.He said: “$40 million is no problem for them.”