Acleda earmarks $79M to underprop SMEs
Acleda earmarks $79M to underprop SMEs
The locally-owned Acleda Bank Plc, the Kingdom’s largest bank in terms of assets, has reserved a $79 million fund to support the growth of small and medium-sized enterprises (SME), according to president and group managing director In Channy.Channy underscored that the fund will allow local SMEs to fuel economic activity for the upcoming year, as the Kingdom emerges from the Covid-19 pandemic.
He told The Post on September 7 that as of August 31, savings and deposits at Acleda reached $5.13 billion and the loan portfolio stood at $4.8 billion, growing by 15.45 per cent and 10.44 per cent, respectively, over December 31.
“These strong growth [indicators] are more than enough to support short-term loan growth for small enterprises. Normally [SMEs] need longer-term” loans with three-to-five-year maturities, he said.
“As usual, Acleda Bank always plans ahead. To meet the long-term funding need for 2022 and the following years, and to support the need[s] of SMEs, Acleda Bank mobilises both domestic and international funds,” Channy said.
He explained that the fund is part of a syndicated loan to Acleda to prepare for post-Covid growth, and that the bank would use domestic funding – from savings and deposits – for short-term financing and include international sources for long-term financing.
“For Covid-19, one should remember that it is part of our daily [lives] already, we should not let [it] stop our businesses [or] wellbeing … we need to survive and [grow, and] support one another,” Channy said.
In a similar move in mid-August, the state-owned Small and Medium Enterprise Bank of Cambodia Plc (SME Bank) officially launched the “Phase II Co-financing Project” to prop up the business activities of local SMEs and abate economic Covid-19 woes.
The second phase was introduced after the first iteration achieved positive results, with participating financial institutions providing lifelines for SMEs in need of financing to keep from going under, and promoting economic recovery.
The funds under this co-financing project amount to $100 million, which is an equal counterpart fund between the SME Bank and the participating financial institutions.
At present, there are 26 participating financial institutions: 21 commercial banks, one specialised bank and four microfinance institutions (MFI) – three of which are authorised to receive deposits.
According to Channy, his bank pitched in around $15 million in the first phase and plans to double that in the second iteration.
