Saturday, July 14, 2007

Public confidence in Cambodia's banking industry picks up [-but the gov't is as corrupt as ever]

July 13, 2007
"It is the already well-off who are getting more wealthy and using the banks, not so much everyday Cambodians" - Anonymous senior representative at the Cambodia Asian Bank
The Cambodians are resuming their confidence in the kingdom's banking industry, as deposits and accounts increased in 2006, said recent statistics from the central bank.

Total deposits in the country's banking system grew by 40 percent in 2006 over 2005, with the number of accounts rising to nearly 300,000, said the statistics from the National Bank of Cambodia (NBC).

Some 2 percent of the 14 million population use bank accounts, while there are 20 banks operating in the country, with the major players reporting healthy growth, according to the statistics publicized on English-language bi-weekly the Phnom Penh Post on Friday.

"(The growth) demonstrates that public confidence in the banking system has been increasing markedly and banking operations have been fairly and efficiently competitive," the paper quoted NBC governor Chea Chanto as saying.

Meanwhile, a senior representative at the Cambodia Asian Bank (CAB) told the paper on condition of anonymity that "the growth is coming from two main sources: increased overseas investment, with money flowing into the country, and the boom in the land market."

"People are buying and selling land, the prices are rocketing and people are making money," he said.

"It is the already well-off who are getting more wealthy and using the banks, not so much everyday Cambodians," he added.

Decades of conflict led to a series of sudden bank liquidation in the late 1990s, exacerbating widespread mistrust of the banks in Cambodia.

With a large number of depositors losing their savings, the banking collapses reinforced a culture of in-home savings, where cash used to be transferred into gold or other assets.

Source: Xinhua

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