RHB Indochina Bank Ltd has its history rooted in the existence of OSK Indochina Bank Ltd which came to Cambodia on October 20, 2008. The merger between Malaysia-based entities, RHB Capital Bhd and stockbroking firm OSK Investment Bank Bhd (OSKI) was completed in 2013.
Today, RHB Indochina has 12 branches throughout Cambodia. In the past 10 years, RHB Indochina has moved up the ranks to number 11 among 45 banks and financial institutions in the country, said Lim Loong Seng, RHB Indochina managing director and chief executive officer.
“When we first started, we stood at number 23. In the last 10 years, we have seen some banks close, and more banks come onboard. Now, we have 45 banks (including six new licenses this year) made up of foreign-owned and local banks but we hold the 11th spot.
“Our next target is to be within the top 10, which we feel we can achieve by next year, if not this year. So, we have had a good run, hence the 10th year anniversary to showcase our small achievement and say thanks to our valued customers and business partners, and regulators,” Mr Lim said in an interview.
Mr Lim, who has been with the bank from the beginning, has seen the banking industry grow from a nascent stage when locals were wary of financial institutions, to increased confidence.
He recounted in 2008 the banking population was less than 10 percent or 1.4 million account holders of the total 14 million population but today, the unbanked population in Cambodia has reduced.
“To date, some 22 percent or 3.5 million of the 16 million population owns at least one account with a bank. This is a big increase in 10 years, it has more than doubled. The remaining 78 percent remains unbanked (but) this figure mostly consists of factory workers, people who live in the rural areas and others,” he said.
Mr Lim started off as the chief executive officer of OSK Indochina, which received its debut licence to operate as a commercial bank in Cambodia, with 25 staff and 500 customers.
OSK Indochina saw Cambodia as a liberal and open market, and was keen to join two other Malaysian banks that were already in existence there.
“We wanted to seize the opportunity by riding on the nation’s economy,” he said.
However, going into the foray of commercial banking for the first time was a steep learning curve for the company as it learnt about the landscape of the Southeast Asian nation amid the Asian Financial Crisis.
“When we started, we were fraught with problems. People said it should be easy as the thinking was smallish here but that was not the case. The country was hit by a severe real estate downturn. Liquidity was weak, market sentiments subdued, banking sector asset quality poor, and credit risk heightened. So, it was certainly not a walk in the park,” he added.
Totally unknown and compounded by the fact it was a foreign bank, OSK Indochina worked hard to brand itself, break the mindset of the people and cope with changing regulations including rules on the paid-up capital of financial institutions.
The paid-up capital when OSK Indochina started in 2008 was $13.5 million but in a year, the government raised it to $37.5 million, resulting in its then-parent company OSK Investment injecting the additional sum in order to abide by the new requirement.
Now, the paid-up capital requirement stands at $75 million but RHB Indochina has managed to not only meet it but has topped it – $100 million, which includes retained earnings and equities.
Following the merger with RHB Capital in 2013, RHB Indochina possesses some 32,000 customers as of September 2018 including current and savings accounts holders with total deposits at $600 million, up 37 percent from the previous year, and commercial clients, and assets growth of up to 20 percent in the past five years. Its workforce has also multiplied 10 times to 250.
On its performance for the financial year ended December 31, 2017 (FY17), profit before tax rose 28 percent to $10.7 million year-on-year, driven by a 10 percent climb in interest income and non-interest income.
“After all these years, we are happy where we are. We engaged locals to drive our people agenda and trained them from ground zero because talents in the Cambodian financial sector were scarce.
“Now, we are rewarded with a bigger talent pool, confident and experienced in contributing to the country as we continue to invest in human development,” he said.
Corporate social responsibility (CSR) is also at the heart of everying it does.
“Giving back to the people matters greatly to us. We remain committed to investing in the future generation. We built three preschools in rural areas so that underprivileged children have access to education.
Mr Lim said like the mighty Mekong River that flows through the city, it competently managed and overcame challenges and obstacles, allowing it to preserve and eventually triumphed in its first decade in the Kingdom of Cambodia.
Going forward, he said although the field is getting crowded with increased competition, he stressed that RHB Indochina is `here to stay’.
“It was a good decision coming here. We owe it to Cambodians who gave us the confidence and supported us, and the government for being supportive and guiding us. We thank you,” he said.