Cambodia is to launch a bond market within a month to give more choice to investors to join the Cambodia Securities Exchange (CSX) and contribute to the development of the capital market, a senior official of the Securities and Exchange Commission of Cambodia said yesterday.
Sok Dara, commission deputy director-general, said that there had been consultations with concerned parties and the public to get input over the draft regulation of the corporate bond market.
Now it was coming to the end of the approval process for draft regulations to open up the bond market.
“We will first launch the corporate bond, not government bonds which take more time,” he said.
“It will not take much longer as I expect that the draft regulations will be finalised and put into force very soon, later this month or early next month.”
“Now, we are working with experts on the project especially from ADB’s Credit Guarantee Investment Fund, issuers and other concerned parties to move on the project.”
Lamun Soleil, CSX director for market operations, said that when the commission issued bond regulations, it would start to receive applications from interested parties. When bonds are issued, they could subsequently be listed and traded on the CSX.
“The bond market is important to the capital market and is complementary to the stock market in order for the whole securities market to grow,” he said,
From the company side, Mr Soleil said, they may want to increase their capital by finding new partners and therefore issuing more shares.
“The firms might also want to borrow from the public and financial institutions by issuing bonds,” he added.
Mr Soleil said from the investor side, bonds are another product type, offering debt choice in companies’ capital structure, providing fixed cash flows and containing lower risk than stock.
“Therefore, some investors, particularly institutional investors, prefer bonds to stock,” he added.
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