Acleda Bank plans to expand into China and Vietnam within five years, after having already decided to do business in neighboring Laos, Acleda CEO In Channy said Wednesday.
“After Laos, we plan to go to China and Vietnam within five years time,” In Channy said, adding that despite both countries enjoying strong economic growth, low-income earners were being neglected there.
“Our strategy is to become a regional bank,” he said. “And the low [income] segments [of society] don’t often get noticed, so we are going to bridge the gaps between the low segment and the high segment,” he added.
Acleda’s expansion into Laos—which it is doing in conjunction with three Dutch firms—will make it the first Cambodian company ever to take their business abroad, government officials said Wednesday.
National Bank of Cambodia Director General Tal Nay Im said that the Lao government had already issued the license for Acleda to begin operations.
Finance Ministry Secretary General Hang Chuon Naron said Acleda, which began as a micro-finance lender in the 1990s and is currently Cambodia’s largest bank, stood a good chance of success in Laos.
“I believe so because of the company’s experience in Cambodia…. Acleda has experience working with the low income people,” he said.
“It has the capital, so it’s no problem,” Hang Chuon Naron added, referring to the $10.5 million the bank and its partners are putting into the Laos project.
In Channy said that the operation in Vientiane would start in May and two more offices would gradually open in the Lao provinces of Savannakhet and Pakse. He said that 12 Cambodian management staffers would work in Laos, while 80 Laotians would be recruited.
He added Thursday that he was confident about the Laos expansion, as the bank would face no competition there.
“In Lao, we know that it would be successful because there is only us, and also in China—no one does it for the low [income] segment,” he said. “They can borrow $20 or $30—any amount,” he added.
In Channy said that studies have not yet been done for the planned moves into China and Vietnam, but the bank had already gathered information about the laws related to banking and financial sectors there.
He also announced that Acleda has expanded its capital holdings from $30 million in December 2006 to $50 million at present.