Prasac moves towards becoming a bank

Prasac president and chief executive Sim Senacheert speaking with the Post earlier this year. Photograph: Vireak Mai/Phnom Penh Post

Prasac, a leading micro-finance institution in Cambodia, had increased its registered capital from US$3.8 million to $20 million in preparation for its transformation into a commercial bank by 2014, the institution said yesterday.

“This is one step in the process of registering to become a commercial bank,’’ Prasac president and chief executive Sim Senacheert said.

“The registration requirement of $37.5 million is a very small amount to become a bank.

“We don’t have any problem increasing our capital, as we have strong shareholders.”

Senacheert said the increase was also aimed at building the public’s confidence so they knew that Prasac had strong resources.

“Currently, Prasac’s total assets are nearly $180 million. Our current assets, which are high, are not very convenient for investors, depositors or borrowers. Thus we need to increase registered capital to increase public confidence as well as expand our business operations,” he said.

The increase in share capital was authorised by National Bank of Cambodia, and Prasac is in the process of amending the Memorandum of Article of Incorporation, according to its press release.

Late last month, Prasac installed 30 ATMs in many of its Phnom Penh branches. Those in the provinces are scheduled to go online this month or in early August.

Senacheert said the institution was preparing its IT system, infrastructure and management, and was studying new banking products.

As of June, Prasac had provided loans to 119,200 active borrowers, with more than $165 million of its loan portfolio outstanding.

There were 68,300 depositors, with more than $19 million in deposits outstanding.

Source: http://www.phnompenhpost.com/index.php/2012071057311/Business/prasac-moves-towards-becoming-a-bank.html