homenavigate_nextFinancial Informationnavigate_nextPresident & Group Managing Director's Report

President & Group Managing Director's Report

Dr. In Channy, President & Group Managing Director of ACLEDA Bank Plc.

Amid the global impact of the COVID-19 pandemic, we revisited our brand image to reflect on the core nature and strengths of our Bank. The year 2020 has enriched our experience in two important ways.

Firstly, we strengthened ourselves by coping with a negative circumstantial situation. Remarkably, the Bank continued to grow while maintaining good assets' quality during the COVID-19 global economic slowdown.

Secondly, as the first listed bank on the Cambodia Securities Exchange (CSX), we had to transform our operations and reporting standards to fulfill the detailed requirements of the National Bank of Cambodia (NBC), the Securities and Exchange Regulator of Cambodia (SERC), and the CSX. Prior to listing on the CSX in May 2020, we had only eight institutional shareholders. After listing, the number of shareholders increased to nearly 4,000 shareholders—both from institutions and those from the general public—who placed enormous trust in us.

Thanks to the digital technologies we have developed and adopted over many years, we were able to achieve both solid business performance and strong engagement with a plethora of regulators and shareholders at the same time.

Performance in 2020

Competitive Environment

Digital solutions are increasingly becoming the primary choice for banks and financial institutions in reaching out to their customers during this COVID-19 pandemic. There are justifiably serious health concerns from the public in general. Digital technology is also believed to be one of the most effective tools to compete in the current market environment amongst financial institutions. ACLEDA Bank at all times strives to serve its customers to grow together not only in Cambodia but also abroad via QR Code Cross border payments.

Operational Highlights in 2020

Retail and Small Business

Lending in the "Small" business category grew by 10.10% or US$202.83 million. The "Personal & Others" category grew by 32.20% or US$38.55 million. "Housing Loans" decreased by US$160.80 million, or 12.27%.

The total amount of loans outstanding was US$4,506.64 million as of the end of 2020.

ACLEDA Bank's deposit balance was US$4,611.30 million (up by 5.57% or US$243.40 million) and the total number of accounts was around 2.89 million. The retail sector accounted for the largest segment of the Bank's growth in deposits with a large percentage coming from first-time depositors: employee payrolls paid through the Bank's Payroll Service and non-bank customers in rural areas using E-Wallet ACLEDA mobile App. Financial products and services via FinTech solutions have contributed to this strong growth.

The Bank maintains a diversified infrastructure of choices with 263 traditional branches (or offices), gradually transforming them to self-service centers with 790 ATMs and 4,287 POS terminals. It's interesting to note that ACLEDA Bank has issued a total of 1.39 million debit cards. Moreover, the digitized ACLEDA mobile App has proved very popular, registered by more than 1.7 million users at the end of 2020.

Medium and Corporate Businesses

In this product category in 2020, the value of loans outstanding grew by 30.81%, and accounted for 35.06% of total loans outstanding. Cash management increased substantially through our arrangement with the public sector, particularly the Social Security Fund, government payroll direct deposits, and vehicle stamp tax collection. In addition, private sector business entities and garment factories were also involved in this arrangement. As a custodian of the Social Security Fund, ACLEDA Bank now receives savings deposits from all provinces and cities. Several new accounts were acquired, the most significant of which were from the expansion of the Bank's ATM networks and the ACLEDA mobile bill payment for public utilities, as well as via ACLEDA Internet Banking services. This has had a positive impact on the Bank's local currency cash flow and has enabled ACLEDA Bank to entirely fund its local Khmer Riel currency loan portfolio from deposits. Demand for payroll services were particularly strong in 2020 with a number of organisations signed up, including entities in the public sector, and local and international companies. They provided excellent opportunities for cross selling of other products.

ACLEDA Bank and its subsidiaries continued to collaborate with their long–term, experienced, and strategic partners representing hundreds of years of combined experience in banking and financial services. These companies assist our mutual common customers to manage their financial resources effectively and efficiently. At the same time, this collaboration helped boost revenue while enhancing long-term sources of funds for the Bank. These partnerships significantly contributed to the Bank's long-term funding. The joint efforts also provided a useful source of off-balance sheet revenue, while enhancing the international expertise of the Bank's management and staff.

Treasury and International

Foreign Exchange (FX) earnings continued to grow and made a valuable contribution to our non-interest income. Based on its risk management policy, the Bank does not trade speculatively or take positions as its FX business is to support customers' businesses only. This is a low risk and stable source of income, which has grown consistently over time, producing good margins, and helped to build up long-standing relationships with customers.

The Bank's balance sheet was further strengthened by robust inflows of customer deposits, resulting in a healthy loan-to-deposit ratio, which provides a solid platform to support the Bank's business growth in selected market operations.

The Bank contributed to the promotion of the use of Khmer Riel (KHR) by providing local currency loans to customers, amounting to more than 14% of its total loan portfolio, exceeding the regulatory requirement of 10%. We actively participated in the Liquidity Providing Collateralized Operation (LPCO) to seek further funding support in local currency.

To support its long-term sources of funding, the Bank diversified its funding options by maintaining and gradually expanding good relationships with its strategic partners globally, especially in Europe, the USA and Asia.

The Bank continued to strengthen relationships with other financial institutions and reviewed our substantial international correspondent network during the year. At the end of 2020, the Bank had 274 correspondent banks residing in 44 countries. In addition, the Bank has a dominant market share in terms of accounts from local banks and microfinance institutions, and we provide fund-transfer services to them throughout the country.

The Bank managed to comply with all its internal risk policies, regulatory requirements, and lenders' covenants.

Strategic Priorities for 2021

  1. Continue to develop Financial Technology (FinTech) services in ACLEDA mobile App to cover regional financial services networks and enrich self-service applications;
  2. Develop banking self-service areas to serve the public and customers 24 hours a day, 7 days a week;
  3. Rebrand and further strengthen the image of the Bank;
  4. Enhance the capacity of both local and foreign subsidiaries to improve the Bank's competitive advantages;
  5. Digitalize administrative processes and documentation to support the Bank's digitization efforts;
  6. Enrich IT systems and security for robust digital functions;
  7. Partner with reputational institutions for business growth;
  8. Act as the custodian to diversify funding from the Cambodia Securities Exchange and worldwide investors; and
  9. Emphasize ACLEDA mobile App as the common means of broader payment in all markets.

The Challenges for 2021

As a listed company, ACLEDA Bank is accountable to two regulators: the NBC and the SERC. It is also accountable to the public at large and to individual investors. Over its long history, the Bank has created trust from its good corporate governance, the rich experience of our management team, and a culture of transparency.

Digital infrastructure and FinTech products narrow the gap of finance and financial service access. These will eliminate distances within the financial market and enable customers to make choices between banks and financial institutions irrespective of their location. They will also stimulate strong competition in both service quality and pricing. "ACLEDA mobile" was fully upgraded. The look and feel is appealing to all ages. It has been built with customers' experiences and user-friendliness in mind. Moreover, it is highly secure and downloadable at any spot where there is Wi-Fi or internet available, providing a mechanism to place ACLEDA ahead of the competition.

The prolongation of COVID-19 pandemic and the slow pace of the COVID-19 vaccine delivery continues to engender public fears and likewise may continue to impact global economic growth including Cambodia's over the short or the longer term.

Compliance with the CIFRS Financial Reports requires a sophisticated system as well as regulatory guidelines in place in time of need. The Bank has successfully developed this, and I am pleased to highlight it and make it known to all stakeholders.

To all our customers, my colleagues on the Board of Directors, management and staff, and not least the Royal Government, the NBC, and the SERC, I offer my sincerest thanks for your support in 2020 and in anticipation of a happy and prosperous 2021.

Dr. In Channy
President & Group Managing Director of ACLEDA Bank Plc.
March 24, 2021.

Do you want QR Code (KHQR) or POS for your business?

Please fill our form here and we will contact you and prepare these payment facilities for you. You can request ACLEDA Bank's QR code (KHQR) or POS terminal for your business.

Apply Now

To declare that our financial statements comply with applicable International Financial Standard and give a true and fair view of the bank's financial position and its performance, we have appointed external auditors to conduct auditing of our bank's statements.