Logo of Phnom Penh Post newspaper Phnom Penh Post - NNA Asia: SBI Holdings set to buy 70% stake in Ly Hour MFI

NNA Asia: SBI Holdings set to buy 70% stake in Ly Hour MFI

Content image - Phnom Penh Post
A man looks at a sign at a branch of Ly Hour Pay Pro Plc, one of Ly Hour Group’s many subsidiaries. Hong Menea

NNA Asia: SBI Holdings set to buy 70% stake in Ly Hour MFI

Japanese online financial services group SBI Holdings Inc last week announced that it will acquire a 70 per cent stake in a Cambodia-based Ly Hour Microfinance Institution Plc (LHMFI) in a bid to re-enter the Kingdom’s banking sector, Japan-based Kyodo News Group’s economic news site NNA Asia reported.

Citing a statement from SBI Holdings released on Wednesday, NNA Asia reported that the National Bank of Cambodia (NBC) approved the acquisition on October 9.

LHMFI is expected to be granted a banking licence shortly by the NBC to expand its business from its current services targeted at retailers, said the statement.

SBI Holdings will initially acquire about 14.94 million shares in LHMFI from its existing shareholders by November 25 and purchase an additional 37.56 million shares on December 23, it said.

The acquisition will carry an $81.7 million price tag and will transform the microfinance institution (MFI) into a commercial bank, which will operate under the new name – SBI Lyhour Bank Plc.

LHMFI chairman Ly Hour declined to disclose further details on Monday, saying “the deal is still under process”.

Cambodia Microfinance Association chairman Kea Borann told The Post on Monday that the deal is a sign of foreign investors’ increased confidence in the Kingdom’s economic growth.

“I think our country’s MFI sector is showing strong growth. The sector is one of the backbones helping to boost economic growth. I think that [if LHMFI] becomes a bank, it can provide more services than as an MFI,” he said.

With competition heating up in the Kingdom’s crowded financial market, Borann believes that mergers will become more prominent in the industry.

“I believe that [more mergers] will take place in the future. The big ones [companies] will buy out the smaller ones or the small ones will merge,” he said.

In 2008, SBI Holdings founded Phnom Penh Commercial Bank (PPCBank) in a joint venture with South Korea’s Hyundai Swiss Financial Group Inc – led by Hyundai Swiss Savings Bank Inc – which was a predecessor to SBI Holding’s South Korean subsidiary SBI Savings Bank Inc.

SBI Holdings withdrew from Cambodia’s banking business in 2016 and sold all its shares in PPCBank as part of its business restructuring.

However, SBI Holdings has engaged in the securities business in Cambodia since 2010 through its local unit, SBI Royal Securities Plc.

The deal is the latest in a series of Japanese investments in Cambodia – particularly in the banking sector.

Last year, J Trust Co Ltd, a Japanese holding company listed on the Tokyo Stock Exchange, purchased a 55 per cent stake in Cambodian joint venture ANZ Royal Bank (Cambodia) Ltd, which was renamed to J Trust Royal Bank Ltd.

In 2012, Maruhan Japan Bank Plc acquired a 95 per cent share in Sathapana Microfinance Institution Plc, which is now Sathapana Bank Plc.

SBI Holdings aims to engage in “innovative banking” by combining the group’s know-how on online financial and other financial technology services with Ly Hour Group’s track record in money exchange, real estate development, money transfer, general insurance and other fields, it said.

“[Asean] is a growing market as a whole, and Cambodia, in particular, is expected to continue growing. We will leverage the know-how we have accumulated in Cambodia’s market,” SBI Holdings spokesman Toshiki Aoyama told NNA Asia.

Cambodia Post Bank Plc CEO Toch Chaochek welcomed the move, saying it is a good sign for the Kingdom’s financial sector.

“I believe LHMFI is strong enough on its own, Seeking an experienced partner to become a bank is a top-notch move,” he said.


  • Siem Reap drain canal now ‘mangrove’ promenade

    A more than half a kilometre long stretch of canal in Siem Reap has been covered and turned into a promenade to attract visitors, said Ly Rasmey, secretary of state at the Ministry of Land Management, Urban Planning and Construction, on September 16. The new pedestrianised

  • Typhoon Noru brings flash floods – 16 dead

    An official warned that that the 16th typhoon of the season, Noru, had brought heavy rains to areas the Mekong River and flooded thousands of homes in the provinces bordering Thailand. As of September 27, the death toll from the flooding had risen to 16. National Committee

  • Angkor wildlife, aquarium park still to open October

    The Angkor Wildlife and Aquarium complex about 30km southeast of Siem Reap town with initial total investment of more than $70 million is reportedly still on track for an end-October opening. The park is located on a 100ha plot along National Road 6 in Kbon village, Khchas

  • Final verdicts for Khmer Rouge leaders ‘vital’ for next generation

    Nearly a decade after the commencement of Case 002/02 against Khieu Samphan back in 2014, the Extraordinary Chambers in the Courts of Cambodia (ECCC) is now set to deliver its final verdict for the former Khmer Rouge head of state. The Supreme Court Chamber of the ECCC,

  • Defence minister reaffirms Kingdom’s staunch support for One-China policy

    Minister of National Defence General Tea Banh has reaffirmed Cambodia’s unwavering support for the One-China policy. Tea Banh was speaking at the September 20 ceremonial handover of 117 vehicles and other military equipment donated by China’s defence ministry, held at Phnom Chumreay International Military Training

  • Deaths due to ‘lifestyle’ diseases rise in Kingdom

    The Ministry of Health has called on people to pay closer attention to their health to protect themselves from non-communicable diseases (NCDs) which it said have caused high rates of deaths in the country. Ministry secretary of state York Sambath made the call at a