Cambodia Investment Review
Golden Tree, one of the leading real estate companies in Cambodia has successfully raised over $1.5 million through the green bond issuance, which plays a crucial role in contributing to the Cambodian government’s mission to become more environmentally friendly while promoting sustainable economic growth.
The ceremony took place at the CSX building on January 19, 2023 in the presence of:
- His Excellency Dr. Hean Sahib, Minister attached to the Prime Minister, Secretary of State of the Ministry of Economy and Finance and Chairman of the Cambodia Securities Exchange
- His Excellency Sou Socheat, Royal Government Delegate in Charge as the Director General of the Securities and Exchange Regulator of Cambodia
- His Excellency Hong Sok Hour, Royal Government Delegate in charge as Chief Executive Operation of the Cambodia Securities Exchange
In addition, various relevant institutes, including the representative of the International Finance Corporation (IFC) ADB, Grand Cathay Investment Trust as well as other potential partners witnessed the event.
Green bond will boost the company’s reputation
According to Mr. Oum David, Executive Vice President and Chief Financial Officer of Golden Tree, introducing green bonds to Cambodia will boost the company’s reputation and attract more local and international investors. It is an opportunity for Golden Tree to expand its business while enhancing the growth of the sustainable finance sector in the kingdom.
“We believe that both the public and private sectors should get involved in environmental protection. The green bond listing will enable our investors to gain a thorough understanding of sustainability securities investments and to benefit while preserving the environment,” he said.
The company successfully mobilized around $1.5 million from the issuance of its approximately 60,000 green bonds at par value of $25, with a coupon rate of 7 percent per annum and a 5-year maturity date. The bond was underwritten by SBI Royal Securities Plc, with Cambodia Securities Plc as co-underwriter.
Strengthening corporate governance and transparency
H.E Hong Sok Hour, CEO of CSX, commented that the listing of the green bond is comparable to other bond listings. However, the green bond issuance is required to adhere to investment guidelines that leave no harm to the environment. “The green bond listed today reflects the securities sector’s contribution for the positive environment and climate change,” he said.
The local bourse has featured 18 firms, nine of which are listed on the main and growth board, the rest issued bonds. These companies raised over $317 million through their offerings.
Golden Tree’s green bond issuance has received technical support from the Asian Development Bank (ADB) to issue and comply with the standard of ASEAN Green Bond. Golden Tree’s CFO, Mr. David, has highlighted that the bond issuance is in line with the company’s perspective and far-sighted vision to become one of the leading real estate companies in the country.
Achieving this, he said, by strengthening corporate governance, transparency in the financial system, and committing to the standard of environmental, social, and good governance. “We would like to design and implement long-term, sustainable policies that support Golden Tree’s growth and address the environmental and social impacts at the same time,” David said.
Demonstrates the growing interest in sustainable investments
The International Finance Corporation (IFC), a member of the World Bank Group, last year October awarded Cambodia’s first EDGE (Excellence in Design for Greater Efficiencies) green-building certification for commercial office projects to VTrust Tower, owned by Golden Tree.
The recognition was given to VTrust Tower because the building succeeded in attaining its requirement by achieving 24% saving in energy consumption, 52% saving in water consumption, and 60% saving in CO2 emissions. This certification further solidifies Golden Tree’s commitment to sustainability and environmental protection.
The green bond issuance is a significant step for Golden Tree and for Cambodia as a whole. The successful listing of the bond on the CSX demonstrates the growing interest in sustainable investments in the country and highlights the importance of the private sector’s role in contributing to environmental protection.
As more companies become aware of the benefits of sustainable finance, it is likely that we will see an increase in green bond issuances in Cambodia and other Southeast Asian countries. The green bond market in the region is expected to grow in the coming years as more investors become interested in environmentally-friendly investments.
Golden Tree’s green bond issuance also serves as an example for other companies in Cambodia to follow. By committing to sustainable practices and environmental protection, companies can not only benefit the environment but also attract more investors and improve their reputation in the market.