The Securities and Exchange Regulator of Cambodia (SERC) and Malaysia’s Maybank Investment Banking Group (Maybank IBG) have continued a Cooperation and Technical Assistance Framework for the development and improvement of the Kingdom’s burgeoning securities market, amid plans to launch the Collective Investment Scheme (CIS) market this year.
A memorandum of understanding (MoU) was signed to this effect at a ceremony on March 31 between SERC director-general Sou Socheat and Maybank IBG CEO Michael Oh-Lau Chong Jin in Phnom Penh.
At the event, Socheat remarked that the MoU, marking the continuation of a partnership, will centre on developing the Cambodian capital market, covering areas such as: derivatives and new products, compliance, risk management, corporate governance, financial and accounting reporting, and foreign portfolio investment (FPI) promotion.
“This MoU signifies the trusted relationship between both parties. The Cambodian securities industry is in the early stages and gradually developing.
“Therefore we are confident our cooperation with Maybank IBG will bring long-term benefits in the form of industry knowledge transfer and product development expertise, especially in gaining experience and innovation in the supervision of the Collective Investment Scheme market.
“This new market will be launched in 2023,” he revealed.
A CIS is an arrangement that allows fund management companies to establish investment vehicles and raise money from investors to channel into specific projects, with profits or benefits distributed to the backers.
Socheat recalled that the government, in view of the capital market’s importance to economic development and integration, adopted a development plan for the marketplace via the Financial Sector Development Plan 2001-2010.
To complement the capital market development plan, the Law on the Issuance and Trading of Non-Government Securities and the sub-decree on the Conduct and Organisation of the Securities and Exchange Commission of Cambodia (SECC) were adopted in 2007 and 2008, respectively, he noted.
Maybank IBG’s Oh-Lau commented at the event that the growing demand from individual investors in the capital market requires better, more innovative investment solutions that provide real-time services.
“We believe investors’ demand for innovative investment solutions will grow as the number of affluent and sophisticated investors in the country continues to rise. As a member of ASEAN’s fourth largest banking group by assets, we are delighted to be given the opportunity to bring our depth of experience to this partnership.
“We remain committed to supporting the SERC in developing the capital market in Cambodia. This cooperation brings to life Maybank’s mission of Humanising Financial Services,” he said.
A total of 18 corporate securities currently feature on the Cambodia Securities Exchange (CSX) – nine stocks and nine bonds. Companies have raised a total of $317 million through their offerings on the local bourse, according to its CEO Hong Sok Hour.
As of January 19, around 36,000 CSX trading accounts had been opened, he said, confirming that the average daily trading value on the bourse reached about $500,000 last year.
In its “CSX 2022 Achievements, Outlook, and Plans for 2023” bulletin, the local bourse revealed a number of targets for this year, such as doubling the number of new securities listings to 14 and the average daily trading value to $1 million, the latter of which would make for a third consecutive year of record highs.
The stock exchange also aims to triple the number of new trading accounts this year, the bulletin said, noting that “over 5,000” were registered in 2022.
The CSX is co-owned by the Ministry of Economy and Finance and the Korea Exchange (KRX) on a 55:45 basis.