NBC issues licence to SBI Lyhour Bank Plc
NBC issues licence to SBI Lyhour Bank Plc
SBI Lyhour Bank Plc, a subsidiary of Japanese internet banking giant SBI Holdings Inc, was awarded an official licence by the National Bank of Cambodia (NBC) to operate in the Kingdom.Last year, SBI Holdings purchased a 70 per cent stake in Cambodian-based Ly Hour Microfinance Institution Plc for $81.7 million, which transformed the latter into the full-fledged commercial bank SBI Lyhour Bank.
SBI Lyhour Bank is headquartered in Tuol Kork district’s Boeung Kak II commune in the capital.
The licence – signed by NBC governor Chea Chanto on March 23 – binds the bank to the Law on Banking and Financial Institutions as well as all regulations, circulars and conditions issued by the NBC.
SBI Holdings said it plans to expand its operations in all of the Kingdom’s provinces with retail and small and medium-sized enterprises as its target clients.
Cambodia Post Bank Plc CEO Toch Chaochek welcomed the move, saying it is a good sign for the Kingdom’s financial sector.
“The move is good overall and it will help inject the national economy with millions of dollars in capital investment, however its target market remains small,” Chaochek said.
In 2008, SBI Holdings founded Phnom Penh Commercial Bank (PPCBank) in a joint venture with South Korea’s Hyundai Swiss Financial Group Inc – led by Hyundai Swiss Savings Bank Inc – which was a predecessor to SBI Holding’s South Korean subsidiary SBI Savings Bank Inc.
SBI Holdings withdrew from Cambodia’s banking business in 2016 and sold all its shares in PPCBank as part of its business restructuring.
However, SBI Holdings has engaged in the securities business in Cambodia since 2010 through its local unit, SBI Royal Securities Plc.
The NBC’s “Macroeconomic and Banking Progress 2019 Report and 2020 Outlook” said the deposits and outstanding loans in the banking industry rose sharply by 25 and 26 per cent respectively last year over 2018.
Outstanding loans reached $19.6 billion and deposits with Cambodia’s seven money deposit-taking institutions reached $22 billion last year.
“The banking sector was healthy and actively contributed to supporting financial inclusion, economic growth and poverty reduction.
“The loans boosted public consumption and contributed positively to the increase in economic activity. However, if the consumer doesn’t use the loan efficiently and with the right goal, the increase in loans will also bear risk to the financial sector,” said the report.
