In a remarkable development for Cambodia’s financial landscape, ACLEDA Bank Plc, a prominent commercial bank, is set to make history by listing its bonds on Thailand’s stock exchange. This strategic move aims to raise $100 million, earmarked for expanding its operations and extending vital support to small and medium-sized enterprises (SMEs).
This groundbreaking listing not only represents a significant milestone for ACLEDA Bank but also establishes it as the first local company to list bonds overseas. The National Bank of Cambodia (NBC) granted its approval for the issuance of Thai baht (THB) denominated subordinated unsecured debentures, a testament to ACLEDA’s financial strength and commitment to growth.
In its filing with the Cambodia Securities Exchange (CSX) on September 18, ACLEDA Bank disclosed its plans to issue 433,163,019 units at 10,020 Khmer riel per unit on the Thai Bond Market Association (ThaiBMA). The bank’s stated purpose for issuing these long-term debt securities is to diversify its funding sources and bolster support for its long-term strategic initiatives.
The bank has informed investors that the initial issuance of Thai baht-denominated subordinated unsecured debentures will be in an amount of up to $100 million equivalent in THB, with a seven-year tenor in Thailand. ACLEDA is diligently preparing to meet all regulatory requirements and conditions set forth by Thai authorities and related parties to ensure a successful issuance.
In Channy, President and Group Managing Director of ACLEDA, shared that this listing will enable the bank to diversify its sources of domestic and foreign funds through the capital market. Highlighting the importance of diversification, he expressed the bank’s commitment to establishing a broader pool of long-term funds, both domestically and internationally.
He added, “We are mobilizing short-term funds from savings and deposits, mostly short-term of one to two years in Cambodia,” and emphasized that pricing for the bonds is expected to be reasonable and affordable, aligning with the bank’s mission to serve its customers effectively.
Sou Socheat, Director-General of the Securities and Exchange Regulator of Cambodia (SERC), affirmed that ACLEDA Bank’s initiative to diversify its funding sources is entirely within regulatory bounds. He emphasized that the bank must adhere to both Cambodian and Thai regulations during this process, ensuring a transparent and compliant listing.
ACLEDA Bank Plc has already demonstrated its pioneering spirit as the first commercial bank in Cambodia to be listed on CSX. In its initial public offering (IPO), the bank successfully raised $17.5 million, with shares starting at 16,200 riel ($4.05) per share. Furthermore, the bank received approval from the NBC to issue green bonds on CSX in November 2021, further solidifying its commitment to sustainable finance.
With the support of SERC, the Cambodian capital market has seen remarkable growth in the past decade. To date, 20 companies have been listed on the local bourse, with 11 of them issuing equity securities. These 20 companies have collectively raised an impressive $328 million in capital via CSX. As of August 30, 2023, CSX boasts a total market capitalization of $3.08 billion, equivalent to 10.6 percent of the country’s gross domestic product.
ACLEDA Bank Plc’s ambitious bond listing in Thailand underscores its dedication to fostering economic growth, supporting SMEs, and contributing to the continued development of Cambodia’s capital market. This groundbreaking move signals a promising future for both the bank and Cambodia’s financial sector as a whole.
Source: The Phnom Penh Post
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