KUALA
LUMPUR: CIMB Bank plc, which aims to be
among the top 10 banks in Cambodia over the next five years, is targeting more
than US$100mil (RM317mil ) in deposits and US$90mil (RM285mil) in total loan
size by year-end.
Its
deputy general manager and head of commercial banking Bun Yin said these
targets were commendable judging from the fact that CIMB started operations
more than a year ago and was a relatively new player in the Cambodian banking
landscape.
In an
interview with StarBiz on the sidelines of the CIMB Asean Conference recently,
Bun said total deposits for the first three months of this year had actually
exceeded the US$100mil mark and was confident loans and deposits would grow at
a strong rate.
He said
deposits was up by 54% in the first quarter of this year compared with the
whole of last year, adding that loan for the same period rose by about 17%.
He
attributed the encouraging growth to strong demand for loans as well as the
ability of CIMB as a regional banking group with presence in the region to
attract business from countries like Malaysia and Thailand which have
investments in Cambodia.
Bun
said there were many Thailand and Malaysia-based companies operating in
Cambodia. Since CIMB also has a presence in these countries, it can leverage on
its regional network and provide funding for these companies.
As for
net interest margin (NIM) growth, he said it was healthy with margins hovering
between 4% and 5%. NIM is a measure of the difference between the interest
income generated by banks and the amount of interest paid out to depositors.
CIMB
Bank plc started operations in Cambodia in November 2010 and is a wholly-owned
subsidiary of CIMB Group Holdings Bhd.
Its
areas of focus in Cambodia are the small and medium enterprise and in retail
banking which Bun feels it has good potential for further growth.
He said
the bank would also look into enhancing its technology infrastructure in terms
of electronic banking, automated teller machines (ATMs) and cash deposit
machines. Introducing sophisticated products is another area which the bank
would continue to look into to meet the demand and needs of its customers.
The
dual currency investment product is one such example and had been well
received.
Bun
admitted that it was a challenge for a country like Cambodia to embrace new
technology and new products compared with traditional banking involving
deposits and loans.
Towards
this end, he said providing sufficient training to the bank's staff in
educating customers to understand the benefits of the products had helped in
addressing some of these challenges.
The
bank aims to become the top 10 bank in the country over the next five years
from the current 15th out of 30 banks there.
Unlike
some standalone banks, CIMB has the advantage of being a regional group and
could provide support from various fronts human resource/expertise, businesses
and customer base to its sister companies via its network in Asean.
Apart
from this, with a common platform, for example allowing CIMB customers to
conduct their ATM transactions within the region where the group operates was a
plus point that would put the company on a stronger footing moving forward, he
said.
As for
competition, Bun said the market was still largely untapped. “With a population
of about 14 million, out of which close to two million have a bank account, and
with 30 banks in the market, there is plenty of room to grow,” he said.
The
country, he said, offered good incentives for banks. Foreign banks are allowed
to hold 100% equity stake in Cambodia banks and without the need for a joint
venture, with no restrictions on repatriations of dividends imposed.
Currency
risk was also minimal as transactions were in US dollars and hence less
fluctuations in exchange rates, he said. He expected the bank to open four more
branches this year, bringing the total to 11.
“CIMB
Bank in Cambodia will be one of the key players for the group in the region but
this will depend on market conditions,” he added.
The
Star
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