Accessibility links

Breaking News

Banking System Shows Signs of Recovery

The total amount of deposits in Cambodia’s 28 banking institutions recorded a jump in the first part of the year, a positive sign of recovery following the 2008 economic crisis, an industry leader said Monday.

Banks posted $3.6 billion in deposits in the first five months of the year, a 13 percent increase from the same period in 2009. Loan disbursements increase 8 percent, to $2.7 billion, for the same period.

That’s a signal of healthier banks, In Channy, CEO of Acleda Bank, a leading lender in Cambodia, told “Hello VOA” Monday.

“2009 was a very hard time for us, where we had large deposits but little lending,” he said. “But this is a good sign this year, when our economy is going better and the demand for loans is growing.”

Agriculture, garments and tourism were all driving growth in the economy, he said.

One concern, however, is that the banking sector has not grown at pace with the country’s total GDP.

“The banking sector would be considered to be growing rapidly only when the amount of deposits is at least equal to the total GDP of $10.3 billion,” he said. “But up to 2009, our deposits were only 30 percent of GDP.”

Still, the number of people banking is growing, up to 1.1 million in 2009, a 38 percent increase from the year before.

“What we should do next is train and educate our people to understand more about the banking system,” he said.