Cambodia’s largest commercial bank listed on the country’s stock market Monday, the first lender to trade on the fledgling exchange, despite uncertainty caused by the coronavirus pandemic.
Acleda Bank became the sixth firm to join the Cambodia Securities Exchange (CSX), which opened in 2011, joining a garment factory, two state-owned ports and a special economic zone.
But initial fanfare for the kingdom’s trading future has dimmed, with the country’s lack of financial literacy and a dearth of eligible companies being major obstacles.
Acleda has been operating since 1993 and boasts assets of US$6.1 billion.
Its chairman and managing director In Channy said about 2,500 public investors became its shareholders Monday, opening a “new chapter” for Cambodia’s financial sector.
He downplayed the risks of debuting on the CSX during the pandemic.
“We saw that our investors did not hesitate because of the trust in Cambodia, in Acleda Bank and in relevant authorities,” In Channy said.
“If we were concerned, we would not have listed today.”
Trading started at 16,200 riel ($3.93) per share and closed at 16,500 riel.
The listing could serve as a “role model for other banks and commercial institutions that wish or are still hesitating to raise capital from the stock market”, said Economy and Finance Minister Aun Pornmonitroth at the opening ceremony.
Hiroshi Suzuki, CEO of Business Research Institute for Cambodia (BRIC), questioned the timing of the IPO in the middle of the coronavirus pandemic.
But if it goes smoothly, “it could send a bright signal to overseas investors,” he said.
Cambodia has so far reported 124 cases of the coronavirus, though there are concerns that not enough tests and contact tracing is being done within the kingdom.
Economic growth is expected to slow to about 2.3%, according to the Asian Development Bank, after almost a decade of 7% expansion.