The
first overseas branch of Saigon-Hanoi Commercial Joint Stock Bank (SHB) will
officially launch in Phnom Penh today in its first bid to tap neighbouring
ASEAN economies.
It is the fifth Vietnamese bank and 34th
commercial bank to compete in Cambodia’s banking sector.
Officials said that despite there being too
many commercial banks for the small country, Cambodia’s financial sector still
has more room to grow. Experts, however, expressed concern over apparent
overcrowding.
The recent surge of bilateral trade and
investments from Vietnam were the two main reasons Vietnamese banks continued
to enter the Cambodian market, Tran Tu, commercial attaché for the Vietnam
Trade Office in Phnom Penh, said yesterday, adding that BIDC and Sacom Bank had
already found success here.
“All businessmen need to borrow money for
business and project development and make any payments by the banks,” he said.
SHB’s business strategy included becoming a
strong financial holding group in the region by 2015, SHB CEO Nguyễn Văn Lê
said.
Yang Chanthy, the human resource manager of
Sacom Bank, which in November 2009 became the first Vietnamese bank in
Cambodia, welcomed the new player to the industry regardless.
“We’re not concerned because we’ve already
stood here for years. We have a lot of clients that already know about us,” he
said.
“Right now, the industry is very competitive
and has too many banks. But, with good services and a wide range of products,
we can provide to our customers,” he said.
Chheng Kimlong, a lecturer of economics and
business at the University of Cambodia, said the recent surge of commercial
banks in the Kingdom’s small economy surpasses the total demands from the
industry.
“I am afraid that in the next four or five
years, the industry will be in trouble as some banks go bankrupt and others
pull out after they make a quick profit from us, thereby giving a negative
image of our industry,” he said.
“The NBC [National Bank of Cambodia] should
have clear regulations to govern them.”
He added that the situation would likely
improve in the medium to long term as Cambodia’s economy continues to grow.
“Later on, when the biggest ones come in,
there will be some merging so that there is just the right number of branches.”
SHB was first established in 1993, and has
grown to include a chartered capital of 4.82 billion dong (US$229.28 million)
and total assets of 70.97 billion dong ($3.38 billion), with a head office in
Hanoi and nearly 200 branches and sub-branches in 25 provinces and cities
throughout Vietnam, according to its press release.
May Kunmakara
The Phnom Penh Post
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