ACLEDA Bank Lao to give out bigger loans
ACLEDA Bank Lao to give out bigger loans
ACLEDA Bank Lao Ltd expects the value of its loans in the second quarter of the financial year to be much higher than in the first quarter because the bank will receive money from international financial organisations to give out more loans.
“Last Friday we reached an agreement on getting 160 billion kip (US$20 million) from the FMO, a Dutch development bank,” Bank Chief Executive Officer and Managing Director Mr Narin Phon said at a Lao New Year celebration on Saturday in Vientiane.
“We will get that money in Lao currency to disburse loans that will start by the end of this month. So I believe that the loans in the second quarter of this year will much larger than in the previous quarter.”
Mr Narin said the bank will also receive 40 billion kip (US$5 million) from TRIODOS, another major financial organisation in The Netherlands in July. The money will again be in kip so it can easily be given out in loans.
By end of this year, the bank may get another 80 billion kip (US$10 million) from KfW, formerly KfW Bankengruppe, a German government-owned development bank based in Frankfurt. “We are now having discussions,” Mr Narin said.
The bank plans to give out loans worth around 1 trillion kip (US$125 million) this year, including the US$89 million given out last year.
He said the bank was currently only able to grant about 720 billion kip (US$90 million) in loans to about 17,000 families.
The bank's loan values have been slow to increase because the bank mostly stocks US dollars but most Lao people deal in kip.
“Based on the Bank of the Lao PDR's regulations, we have to disburse loans in foreign or Lao currency depending on which currency the customers earn,” Mr Narin said.
“If their earnings are in foreign currency, they can take out a loan in foreign currency but if their income is in Lao currency we have to disburse loans in Lao currency.”
The bank has almost 40,000 deposit accounts and is holding over 640 billion kip (US$80 million).
In its deposit account plan for this year, the bank has targeted securing up to around 800 billion kip (US$100 million). This money will include US$73 million that the bank has accrued from last year.
ACLEDA bank opened for business in July 2008 and was the first Cambodia-based commercial bank to operate in Laos. It has experienced fast growth; its assets are now worth more than 1,000 billion kip and it has 45 ATMs and 41 service and branch offices.
It now has 913 employees and expects to have at least 1,100 by the end of this year. It is now busy upgrading its staff in Laos and overseas to prepare for the introduction of the Asean Economic Community (AEC) in 2015.
Another reason the bank expects to have additional staff is because it plans to open four additional service offices in Vientiane and the provinces of Xaysomboun and Savannakhet.
It recently received a congratulatory certificate from the government to certify that it is operating an excellent business and has made a significant contribution to economic development over the past five years (2008-2013).
Its shareholders include ACLEDA Bank Plc, the International Finance Corporation (operated by the World Bank Group) and Triodos-Doen and Triodos Fair Share Fund, The Netherlands' financial development company.
vientiane times
