IFC Acquires 19.9 Percent Stake of Cambodia's Leading Microfinance Institution

Mar 2015
Cambodia, March, 13 2015 - The International Finance Corporation (IFC), a member of the World Bank Group, has acquired 19.9 percent of the share capital of Amret, the third-largest microfinance institution in Cambodia, according to its media statement on Friday.

The investment will enable Amret to increase lending to micro and smaller businesses as well as low-to-middle-income borrowers, the statement said.

In addition to the equity investment, IFC has also provided a loan of up to 10 million U.S. dollars to Amret, it added.

Amret's chief executive officer Chea Phalarin said the 19.9 percent stake cost around 15 million U.S. dollars.

"With IFC's support, we strongly believe that our business will grow more rapidly and reach more small businesses and individuals seeking loans," he said.

Currently, Amret has total assets of 359 million U.S. dollars and has lent to 367,000 households with outstanding loans totaling 309 million U.S. dollars, he said.

Over the past two decades, Cambodia's microfinance sector has been developing rapidly with annual growth rates of more than 30 percent, benefiting more than 1.9 million borrowers. Yet, many microfinance institutions' operations remain small in scale and do not have national reach, the IFC said.

"The microfinance sector in Cambodia is at an important phase of development as several key microfinance institutions are planning to transform into either deposit-taking lenders or commercial banks offering a wider range of banking products," said Adel Meer, IFC's financial institutions group manager for East Asia and the Pacific.

"IFC is supporting Amret's transformation (into a commercial bank) with our financing and advice," he said.

Source : GlobalPost

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