Loans, Deposits Soar in First Six Months

The country’s banking sector saw robust expansion in the first six months of the year, with loan disbursements growing by more than 33 percent and deposits growing by 26 percent, according to a report released on Tuesday by the National Bank of Cambodia (NBC).

Loan disbursements increased to about $13 billion, compared to $9.75 billion in the first six months of 2014, while customer deposits rose to $12 billion, compared to $9.54 billion, the report says.

“This semester, the banking system continued its development in both coverage and operation scope, and collected idle savings to finance all economic sectors, especially investments in manufacturing,” NBC governor Chea Chanto said in the report.

However, Grant Knuckey, CEO of ANZ Royal bank, said the continued trend of loans outpacing deposits needed to be kept in check.

“Loan growth needs to be slowed to be more in line with deposit growth,” Mr. Knuckey said in an email.

Currently, the economy “is dependent on wholesale offshore funding to address the mismatch,” he said. “That is not healthy in a developing market.”

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