PRASAC Microfinance Institution Plc – the largest microfinance provider in Cambodia – has restructured all its top management announcing a new CEO and executive members after the company was fully acquired by KB Financial Group.
The New York exchange-listed KB Financial Group fully acquired the company in August this year paying $322 million for 30% of the company. The group had already purchased 70% of the company for $603.4 million last year from Sri Lankan-based non-banking lender LOLC Holdings.
According to official company sources, Oum Sam Oeun has now been appointed as President and Chief Executive Officer. He had worked in the position of Executive Vice President & Chief Operations Officer since 2011.
In addition, the new executive team includes: Kong Sean (Chief Operations Officer), Ry Vanna (Chief Business Officer), Hoeun Honey (Chief Human Resources Officer) and Pen Sovannsoksitha (Chief Marketing Officer).
Sim Senacheert told Cambodia Investment Review that it was a pleasure and honor to lead a company like PRASAC that contributed to the development of the economic and financial system in the country.
“During my leadership in the past 18 years as the CEO, we keep building trust and confidence with professional and transparence to attract more investors, lenders, depositors, and borrowers, thank to management commitment, hardworking staff and supports from all stakeholders we reached more achievements,” he said.
18 years of strong growth under Sim Senacheert
PRASAC has grown with the development of Cambodia’s microfinance sector experiencing massive expansion from 2004 where the company has grown from just 372 staff to now over 9,200 this year; and 31,375 loans to 523,212 over the same period.
In addition, total assets grew from $9 million to $4.07 billion and equity from $526,717 to $634.2 million over the 18 year period.
“We have provided inclusive assess to financial services to people for more than 500 thousand loan clients and more than 600 thousand deposit clients by establishing 180 offices nationwide and we are offering diversified products including Internet and Mobile Banking products to the clients,” Sim said.
“In the past 20 years, the sector sustainably grew and developed from an informal into a formal and regulated sector thank to peace in the country, stable macro-economic and good regulator as NBC by issuing sound and supporting regulations and supervises/regulates the sector well that allows the sector to grow, improve and strengthen its governance, risk management, operations, products, digitalization its operations and so on,” he added.
Exiting COVID and entering digitization
This year PRASAC was able to turn around from serious financial concerns in 2020 over an $800 million “technical default” when the company was forced to request it lenders temporarily waive some covenants stipulated in its loan agreements.
According to the company’s latest filings to the regulator, the company made a profit of $115.4 million in the first nine months of 2021. As of Q3 of 2021, total assets were $4.07 billion, growing 22.06% compared to the same quarter of 2020.
The deposit balance also increased to $2.46 billion, and the gross loan portfolio amounted up to $3.60 billion. The shareholder’s equity also grew and reached $634 million while registered capital was $300 million in the reporting period.
Reflecting on the future of PRASAC and the finance sector in Cambodia Sim believes that more of the big players like Prasac will be taken over by banks and move up the market and become commercial banks. While the smaller MFIs will grow and replace the big players that moved up. The big change is the digitalization in sector.
“We still see more room to grow, especially with the potential from traditional operations to embrace digitalization and I do hope that many other small MFIs can build up their strengths and capacity to grow just like we did in the past,” he added.