National Bank of Cambodia

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With favorable business, regulatory and policy environment, the microfinance sector hasgained significant confidence from the public including both debtors and creditors,particularly from the poor in rural areas and foreign investors. As of 31 December 2011, 23%and 77% of total registered capital is owned by Cambodian and foreign shareholdersrespectively.Total loans increased by 50% from KHR 1,724,841 million (USD 426 million) at the end of2010 to KHR 2,591,263 million (USD 641.53 million) at the end of 2011. The number ofborrowers rose by 17% from 978,077 to 1,141,913. Aggregate amount of deposits, on theother hand, surged by 180% from KHR 164,014 million (USD 41 million) to KHR 459,473million (USD 114 million) in the same period.Loans and Deposits (MFIs)Loans and Non-Performing Loans (MFIs)3,000,0002.80%3%2,591,2632,500,0002,591,2633%In Million KHR1,724,8411,244,5971,108,225617,907459,473164,01421,211 22,082 39,627Million of KHR2,000,0001,500,0001,000,000500,000-616,953 1,130,216 1,244,597 1,724,8410.19%0.42%1.18%2%2%1%1%0.22%0%2007 2008 2009 2010 20112007 2008 2009 2010 2011LoansDepositsLoansNPL RatiosThe average delinquency ratio is 0.22%, decreasing from 1.18% in 2010 despite thesevere flooding in the country in the third quarter. In compliance with the regulations ofthe National Bank of Cambodia, the average solvency ratio is 21.25 % and the liquidityratio is 398.66%. MFIs’ profitability continues to increase. In 2011, total net profit isKHR 110,117 million (USD 27.26 million), a 63% increased from the end of 2010. Return onasset and return on equity ratios were 3.64% and 15.10% respectively.4. Development in the Banking Supervision4.1 Regulatory DevelopmentThe National Bank of Cambodia revised many of its regulations and circulars to achievea more effective supervision and be in line with recent developments in financial sector.During 2011, the National Bank of Cambodia issued a circular related to net worthcalculation, and 5 other regulations, including Prakas on risk based and forward lookingsupervision, Prakas on credit information sharing system, Prakas on transparency ingranting credit facilities of banks and financial institutions, Prakas on financial leasingbusiness, and Prakas on licensing of financial lease companies.- 3 -
4.2 Supervisory DevelopmentAs the supervisory authority, the National Bank of Cambodia, regularly conducts off-siteand on-site examination on banking and financial institutions to protect depositors’money, maintain safety and soundness, and promote fair competition in the bankingsector. The supervisory approach is progressively moving from rule-based supervision torisk-based and forward-looking supervision. To enhance data and information flow, theNational Bank of Cambodia has also revised and updated supervisory reporting systemfor both banking institutions and microfinance institutions. This new reporting system is anonline based submission that would provide timely and accurate information on thecondition of the banking and financial institutions. It also helps to reduce burden andcost related to reporting submission by banking and financial institutions and alsoexemplify the development in Cambodia’s banking sector in response to rapidtechnological advancement and the fast changing environment of the industry.4.3 Financial Products and Services DevelopmentAs the banking sector’s growth continues to accelerate and increase in sophistication,new banking products and services also develop. Leasing and hire purchase productshave been increasingly prevalently used mainly for consumer goods financing. Bothbank centric and mobile banking centric models are operating Cambodia. Regardlessthe models are forms mobile banking business are strictly and subjected to theregulation and supervision of the National Bank of Cambodia to ensure the protection ofcustomers.4.4 Infrastructure DevelopmentThe National Bank of Cambodia has recognizes the importance of enhancing theexisting infrastructure in the banking sector in order to further facilitate the role ofbanking sector in promoting economic growth. As a result, the National Bank ofCambodia has undertaken extensive work to upgrade its national payment system,creating regulatory platform for an interbank market and has supported the creation ofa private-owned credit bureau expected to be launched early in 2012 to enhanceintermediary function and risk management function of regulated entities. This creditbureau is expected to facilitate credit flow in the economy by reducing informationasymmetry between banking institutions and their customers.Strengthening accounting practices within banking institutions is also recognized as animportant milestone for banking sector development and for the banking sectorintegration in the region. Cambodia banks are expected to implement the InternationalFinancial Reporting Standard (IFRS) by 2016. The roadmap toward full adoption of theIFRS for banking institutions is in the study process. The roadmap would provide areas forimprovement of current practices for both authority and market players. This will lead tochanges of accounting policy, information system, personals/skills set, and prudentialregulations. Enhancing cooperation among financial regulators within the country is alsorecognized as a crucial step to ensure sustainable development. As demonstrated by- 4 -
Page 2 and 3: ForewordIn 2011, many developed and
Page 4: CONTENTS1. Structure of the Banking
Page 7: Number of Debit and Credit Cards (B
Page 11 and 12: Retail and wholesale sector capture
Page 13 and 14: Banks - Return on Assets and Return
Page 15 and 16: Appendix 1Data of Banks and Microfi
Page 17 and 18: Number of staffAs of December 31, 2
Page 19 and 20: SHARE OF PAID-UP CAPITALAs of Decem
Page 21 and 22: Table 6PERCENTAGE DISTRIBUTION OF A
Page 23 and 24: Table 8TotalLiabilitiesand EquityOw
Page 25 and 26: Table 10Commercial BanksNET PROFITS
Page 27 and 28: TOTAL DEPOSITS CLASSIFIED BY CUSTOM
Page 29 and 30: Table 14(millions of KHR)2011 2010
Page 31 and 32: Table 16LOANS AS PERCENTAGE OF DEPO
Page 33 and 34: Number of Offices of Micro Finance
Page 35 and 36: Table 20COMPARISION OF TOTAL ASSETS
Page 37 and 38: Table 22COMPARATIVE STATEMENT OF CO
Page 39 and 40: COMPARATIVE STATEMENT OF CONDITIONA
Page 41 and 42: PROFIT AND LOSS STATEMENTFor Year E
Page 43 and 44: Table 28COMPARISION OF TOTAL DEPOSI
Page 45 and 46: Table 30LOAN AND NON-PERFORMING LOA
Page 47 and 48: Table 32LOANS CLASSIFIED BY TYPE OF
Page 49 and 50: Head Office Address of Microfinance
Page 51 and 52: 23 Angkor ACE Star Credit# 99, Stre
Page 53 and 54: Nº BANKS' NAMEAppendix 2BRIEL AND
Page 55: No. Name of Institution No. Name of

National Bank of Cambodia

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