Monday, August 31, 2009

NBC would widen bank use


The Phnom Penh Post
Monday, 31 August 2009
Nguon Sovan

ASENIOR central banking official said she hoped a government directive requiring civil servants to receive their salaries through a bank account will help efforts to boost the number of people in the country with deposits at commercial banks.

Despite rapid growth in deposits over the past few years, just 820,284 people, or 6 percent of the population, have deposit accounts at commercial banks, said National Bank of Cambodia Director General Tal Nay Im.

She said she was optimistic the number would increase as people became more aware of the advantages of holding money at banks.

"Now, thanks to wider expansion of bank branches throughout Cambodia, people prefer to transfer money through bank accounts rather than carry cash with them because cash transfers via bank accounts are fast and safe," she said.

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People prefer to transfer money through bank accounts.
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Central bank figures released earlier this month show deposit growth slowed considerably last year after rapid growth this decade saw deposits climb from just 14.2 percent of GDP in 2000 to 28.6 percent by the end of 2008.

Deposits grew just 3.67 percent to US$2.52 billion by the end of 2008 after growing 71.4 percent in 2007 from $1.4 billion to $2 billion.

However, the number of depositors reached almost 700,000 by the end of last year, up 53.4 percent from a year earlier.

The central bank said the value of deposits increased in the first half of 2008 but declined again once the global financial crisis kicked in as investors from elsewhere in the region remitted their US dollar deposits to their home countries to take advantage of exchange rate benefits as the value of their currencies fell against the dollar.

Tal Nay Im said deposits had begun growing again this year, with $2.9 billion currently deposited in 820,284 accounts at the country's 28 commercial banks, up from 24 at the end of 2008.

Just five banks accounted for 72.6 percent of deposits at the end of 2008: ACLEDA Bank with 18.2 percent, Canadia Bank 17.2 percent, Cambodian Public Bank 15.1 percent, ANZ Royal Bank 13.9 percent and Foreign Trade Bank of Cambodia 8.2 percent.

ACLEDA Bank's CEO In Channy said it currently had too much money, having tightened lending, and so had reduced interest rates on one-year fixed deposits from 7 percent late last year to 6.5 percent.

"However, we still encourage customers to deposit at our bank, but now it is not through increasing deposit rates but through fast and safe services for our customers," he said.

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