The Cambodian Bankers Association has recommended to the Council of Ministers that

all banks in Phnom Penh adopt a uniform tariff structure as a means of bringing more

order to the banking process and at the same time to prevent a "price war"

among banks.

Specifically, the association has called for a 0.25 percent commission on all inbound

and outbound money transfers, a fixed system of telex charges with different prices

depending on the source of the transfers and, with regard to current and savings

accounts, a standardized minimum deposit required to open an account for both individual

and corporate clients.

For current accounts, the association recommended a minimum of U.S. $1,000 for an

individual and U.S. $2,000 for a company; for savings accounts, U.S. $500 and U.S.

$1,000 respectively.

The Council of Ministers is expected to agree with the recommendations and to request

that all banks implement them beginning Mar. 12, according to Mr. Phot Punyaratabandhu,

president of the association, who is also president of the Cambodia Farmers Bank.

The tariff structure is just one of many issues that the Cambodian Bankers Association

is dealing with in an effort to systematize banking rules and regulations in Cambodia.

The association was established as an informal group in early l992 when foreign banks

were beginning to set up operations in Phnom Penh. The Cambodia Farmers Bank took

the lead in bringing together representatives from other banks to meet on a regular

basis for the purposes of adopting rules in an environment absent of a national banking

law.

The idea developed to establish the association as a non-profit entity. A green light

to do so was received from the National Bank.

To date fourteen banks are members of the association. Any new bank that opens an

office in Phnom Penh is invited to participate. Members meet every second Friday

of the month. Any recommendations agreed upon are forwarded to the Ministry of Finance

and the National Bank for review, with final adoption required by the Council of

Ministers.

"The idea is to work with the Ministry of Finance and National Bank," said

Phot. "Since there is no banking law we work with them to advise on the development

of proper banking regulations. Our objective is to help develop the country, stabilize

the riel, and give ideas on how to do so."

Phot said that the next step is to implement a check clearinghouse. "We want

to encourage people to use checks," Phot said. "We want to prevent this

country from becoming a money launderer."

The idea of a check clearinghouse has been agreed upon in principle among the association's

members. Details on how to implement it are still being worked out.

Additional items on the agenda include the development of a mortgaging law so that

banks will feel comfortable making property and construction loans. The association

is also looking at ways of encouraging a system of trade finance so that all international

trade transactions are made through letters of credit, which would enable any new

government to collect taxes in an orderly manner.

"This country can't go anywhere without a comprehensive banking system,"

Phot noted. "We're working on it step by step."