Cambodia Investment Review

ACLEDA Bank Reports Consecutive Record Annual Profits in 2022

ACLEDA Bank Reports Consecutive Record Annual Profits in 2022

Cambodia Investment Review

ACELDA Bank, one of Cambodia’s largest commercial banks, has reported consecutive record profits for the year ending on December 31, 2022. The bank’s total profit for the year reached an all-time high of $181.8 million, up from $166.7 million in 2021. Despite the record-breaking performance, the bank’s share price remains far below its 2020 initial public offering (IPO) price, leaving many first-time investors with losses of up to 40%.

The bank’s impressive financial performance can be attributed to its continued investment in technology, as well as its ability to weather global economic challenges, such as the Russian-Ukraine war, inflation pressures, and China’s economic slowdown.

Read more: ACLEDA Bank posts record profit of $166M in 2022

While the ASEAN economies have been on track to rebound in 2022, supported by reopening economic activities, the bank acknowledges that the Ukraine-Russian war and slower economic growth momentum, together with capital market volatility, could pose risks to the economic recovery of ASEAN countries. Despite these challenges, driven by robust trade performance, largely export growth in manufacturing and agriculture, investment sentiment rebounded, domestic economic activities rebounded, and gradual tourism sector recovery.

Efforts to upgrade core systems

During the fourth quarter of 2022, ACLEDA Bank continued to upgrade its system and self-operations functions, signing agreements with business partners to provide customers with the most convenient, multitudinous, and outstretched with the highest secured electronic banking services.

The Bank successfully upgraded its core banking system and continued to improve many functions of self-service operations on ACLEDA mobile, QR code, ATMs, and POSs in line with the 125 self-service banking (51 locations in Phnom Penh and 74 locations in provinces) adding to its existing 264 branches. The Bank equipped 1,140 ATMs, 4,358 POS machines, and QR codes based on institutions, hospitals, travel agencies, gas stations, and others in over the country. By the end of December 2022, the Bank has about 0.2 million business partners and 2.61 million ACLEDA mobile subscribers.

The bank’s efforts to upgrade its systems have resulted in an increase in its total assets, which grew to $9.05 billion, up by $1.26 billion, or 16.18%, compared to the same period last year. Its total equity of owners of the Bank also increased by $124.6 million, or 10.46%, compared to the previous year. Meanwhile, the bank’s total gross non-performing loan (NPL) to gross loan ratio was 2.90%, indicating a relatively low level of bad loans.

Share price remains low despite strong performance

Despite the bank’s impressive financial performance, its share price has remained below its 2020 IPO price of KHR 16,200 per share. As of February 2023, the stock is trading at KHR 11,420 per share, leaving many first-time investors with losses. The bank attributed the low share price to the regulator’s approval to float the remaining 64.9 million ACLEDA Staff Association (ASA) shares on the open market from April 2022, equivalent to 14.9% of total company shares.

Read more: ACLEDA Financial Trust buys 3.329M in company stock under 5-year strategy

The bank’s low share price presents an opportunity for long-term investors to acquire shares at a discount. The bank’s continued investment in technology and its ability to navigate global economic challenges make it an attractive investment opportunity. Moreover, the bank’s commitment to upgrading its systems and providing the most convenient, secure electronic banking services positions it to benefit from the growth potential of Cambodia’s banking sector.

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