’09 Bourse Launch No Longer In the Cards, Officials Say

The launch of Cambodia’s stock market will be delayed until the middle or second half of next year, a Ministry of Finance official said Friday.

The launch of the stock market had originally been planned for Sept 9, carrying the propitious date 09-09-09. Though amid much skepticism that the time­table would be kept, ministry officials had also offered December as another possible launch date.

“The stock market will open next year—the second half of next year or the end of next year,” said Chheong Chantha, chief of the Finance Ministry’s financial market division.

Finance Ministry Secretary-General Hang Chuon Naron also said that the stock market will not be a reality until next year.

“To have the official opening we need to prepare the companies for listing. It will take roughly one year,” Mr Chuon Naron said, adding that several Cam­bodian firms are about four months into the process, which in­volves certain auditing and transparency procedures.

The stock market will also need a physical space, Mr Chuon Naron said, noting that the plan is still to house the future bourse at the Camko City project in Russei Keo district.

Due to lack of demand for units at Camko, construction at the massive housing development has slowed almost to a standstill in recent months, but Mr Chuon Naron brushed aside the slowdown and said that the problems with the building work were not a major concern.

“The problem with Camko is temporary. It happens all over the world,” he said.

Han Kyung-tae, chief representative of Seoul-based Tong Yang Securities Company, said his company is helping five Cam­bodian companies to prepare for their initial public offerings—sales of stocks occurring immediately before the price is allowed to float on the open market—which now will not take place until at least April, itself an optimistic date.

Mr Han declined to reveal the names of the five companies that are in preparations for listing.

“If the government wants to make it in April we can push. We would have to speed up if that’s the plan,” he said. “I expect the opening will be next year…. It might be more complicated than we think,” he added.

The Securities and Exchange Commission of Cambodia is still drafting the necessary rules and regulations for the listing of companies and licensing of brokerage firms, said Ming Bankosal, the director general of the SECC.

Those regulations could be approved in late September or October, he said.

In-pyo Lee, the Phnom Penh-based project manager for the Korea Exchange, declined to comment on a possible start date for the exchange, but noted that a “soft launch” of the bourse may yet occur this year.

“A soft launch means we open the exchange with the trading companies [but] without full operation. We have an office and we have staff, and the brokerages will be licensed by the SECC, but no companies [would be listed],” he said.

The Korea Exchange signed a joint venture agreement with the government in March giving the Korea Exchange 45 percent control and the government 55 percent control of the Cambodian exchange.

Acleda Bank, one of the few companies publicly to state its interest in joining the stock market, will not list in the stock market immediately, said bank president In Channy.

“It depends on the development of the stock market. If it works well, we will join. We are in no rush,” he said.

Earlier this year, Ministry of Finance officials had insisted the project would be ready in December.

That changed in February when Prime Minister Hun Sen said that the exchange may be postponed ,due to the economic crisis.

“If the world stock markets are still in anarchy, should we follow the plan in 2009 or not?” the prime minister asked at the time. “If the stock market is born to die we should not establish it at this time.”

Since then officials have been less specific about when the bourse will launch, mentioning December or 2010 as possibilities.

 

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