‘Cambodia a good option for banks’
KUCHING: Local banks are looking to Cambodia as a growth market due to the limited opportunities for financing growth in the domestic scene.
Following a visit to several local banks, the research arm of TA Securities Holdings Bhd ( TA Research) believed Cambodia is a good market for local banks to venture into to enhance their earnings.
Backed by favourable demographic mix, a growing economy and increasing political stability, Cambodia offers Malaysian banks a good market to diversify their assets as well as opportunities to tap into an economy with great growth prospects.
“Local banks could benefit from the weak ringgit while banks with overseas operations could also benefit from the foreign exchange translation gains,” it added in the report.
Cambodia has one of the fastest growing economies in the world. It estimated that the country’s economy is expected to maintain a robust growth of seven per cent through 2020 after registered an average 10year gross domestic product ( GDP) growth of 7.6 per cent.
TA Research observed the Cambodian government’s friendly policies such as tax
Local banks could benefit from the weak ringgit while banks with overseas operations could also benefit from the foreign exchange translation gains.
holiday up to eight years for qualified investment projects ( QIP), duty free imports of capital goods for QIP, 20 per cent corporate tax, nondiscriminatory policy towards foreign investors, no restriction on repatriation of capital and cheap labour – have helped support the growth of foreign direct investments ( FDI ) , putting the country’s GDP per capita on an upward trend.
The research firm noted the country registered GDP per capita of US$ 1,320 billion in 2016, rising steadily from US$ 760.8 million in 2008.
In 2016, TA Research said World Bank has upgraded the country’s classification to a lower-middle income economy with gross national income ( GNI) thresholds of between US$ 1,026 and US$ 4,035.
On another note, Maybank Cambodia, a subsidiary of Maybank Group foresees exciting times ahead for the banking sector especially in
TA Research
areas of the cards and payments in Cambodia.
As banks ventures into mobile banking, the research firm noted the Cambodian central bank is supportive over efforts to increase the usage of mobile banking services, especially in rural areas.
TA Research noted with 65 per cent of Cambodia’s population below the age of 30 and just 10 per cent of Cambodian mobile phone users using mobi le banking services, there is room for banks to improve their mobile and digital platform to attract a wider base of customers.
The research firm gathered from Maybank that the banking group is the only bank in Cambodia that can provide its corporate customers with mobile banking. Turn to Page B2, Col 5