Credit Bureau (Cambodia) Co Ltd (CBC) on July 31 launched a “credit risk heat map” tool for financial institutions to monitor credit risk levels across multiple geographies.

The tool is CBC’s latest solution in the form of a dynamic and interactive map which enables C-level executives and senior managers from lending institutions to “conveniently navigate their institution’s credit risk from one location to another”.

Oeur Sothearoath, CEO of CBC, said that in the last few years, the financial sector in Cambodia has been undergoing a digital transformation and making leaps in data analytics capabilities.

With progressive growth of the credit market today, CBC is able to cater to 180 member banks, microfinance institutions (MFI), leasing companies and rural credit institutions.

“On one hand, our members are expanding their operations to new markets. On the other hand, they also need to ensure that they are operating at optimum risk level in the existing markets.

“Hence, [the development] of the heat map to complement [our] data analytics report [DAR] based on evolving needs of our members,” he explained.

Accordingly, the heat map not only reflects the latest trends in the market but also meets the emerging data needs of financial institutions.

In addition, CBC took into consideration the needs of members and added dynamic navigational features to drill down to commune level performance, compare an institution’s credit quality and restructured loan performance to sector average and extract data from the map for further analysis.

“With insights on credit performance, history and transactions of borrowers at commune, district and province levels, financial institutions can re-strategise portfolio risks, market strategies and product planning based on the needs of their consumers in target geographies,” CBC said.

The credit risk heat map together with DAR is expected to raise the accuracy of risk avoidance, default accounts inquiries, and ensure a safer and higher loan quality for the financial institutions by offering data insights.

A recent National Bank of Cambodia (NBC) report showed that outstanding loans in banks and MFIs reached $51.5 billion as of June 30, an increase of 23.4 per cent year-on-year. Customers’ deposits rose 16 per cent to $42 billion.

It also stated that overall non-performing loans (NPL) of banks and MFIs stood at “controllable rates” of 2.6 per cent and 2.3 per cent, respectively.

As of June 30, Cambodia housed 57 commercial banks, nine specialised banks, five deposit-taking MFIs, 80 non-deposit-taking MFIs, 231 rural credit institutions and 17 leasing companies.

In 2020, CBC revamped its DAR suite of business intelligence dashboards which enabled senior executives from member financial institutions to carry out strategic and tactical monitoring of their performance.