Cambodia’s banks showing Covid cracks

Central bank and finance executives downplay pandemic risks but credit defaults are clearly rising.

The message from Cambodia’s central bank and financial executives is that all is well on the financial front. This month, for instance, they pointed to 20.7% growth in lending in the first half of the year, low inflation and growing deposit-taking as cause for reassurance.

But they surely know the Covid-19 pandemic – and the economic crisis it has wrought – is taking a rising toll on the economy and borrowers’ ability to repay their loans.

“The main risks are the prolonging of Covid-19 and a fall in people’s income and business,” National Bank of Cambodia Governor Chea Chanto acknowledged to local media last month.

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