HKL to issue Cambodia’s first bond

Sum Manet / Khmer Times No Comments Share:
A HKL office building in Phnom Penh. Supplied

Hattha Kaksekar Limited, one of the largest microfinance institutions in the country, will issue the first corporate bond in the country, after obtaining approval from the Central Bank earlier this month.

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It will be the first corporate bond issuance in the country, effectively launching Cambodia’s bond market.

“I am very pleased to announce that we have received a no-objection letter from the National Bank of Cambodia on the issue of the issuance of corporate bonds,” said Hout Ieng Tong, president and CEO of HKL.

“HKL will be the first company to issue corporate bonds in Cambodia,” he said.

The company will offer a total of 80 billion riel in bonds (about $19.7 million), with an additional 40 billion riel ($9.85 million) in case demand from targeted investors exceeds expectations.

The bonds have a tenor of 3 years and the annual coupon rate ranges from 7.5 to 8.5 percent.

HKL has received guidance from SBI Royal Securities, a financial advisor and underwriter, during the bond issuing process.

“HKL will use the net proceeds for funding growth in the lending business, as working capital and for general corporate purposes.

“The proceeds will also support micro, small and medium-sized enterprises in rural and urban areas,” Mr Ieng Tong added.

Last month, HKL’s total capital reached $150 million following a $45 million investment from the Bank of Ayudhya (Krungsri), a member of Mitsubishi UFJ Financial Group, Japan’s largest banking group.

HKL, with its 178 branches and 129 ATM terminals nationwide, is the third largest microfinance deposit-taking institution in Cambodia. As of June 2018, HKL’s deposits stood at $409 million, with 227,679 depositors, while its credit portfolio was worth $660 million, with 135,345 borrowers. The company’s total assets were valued at $804 million.

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