South Korea’s KB Financial Group, whose name derives from its Kookmin Bank, recently issued the first of two tranches it agreed pay for 70 percent of the shares of Prasac, a microbank in Cambodia. Sri Lanka’s LOLC Group, whose name comes from the former Lanka Orix Leasing Company, will take in a total of USD 603 million on the deal, which has been approved by all pertinent regulators. Prasac has 180 branches and 150 automated teller machines (ATMs). As of 2019, it had total assets of USD 3.1 billion, USD 1.8 billion in deposits and a loan portfolio of USD 2.5 billion outstanding to 417,000 borrowers.
KB President Hur Yin said, “With long-term plans to turn Prasac into a commercial bank, we hope to develop Prasac into a leading bank by transferring KB’s strong retail capabilities and make it a base to conduct business in Southeast Asia.” KB has 30 million customers.
Prasac President Sim Senacheert said, “With KB’s investment, Prasac will have more sophisticated products including digital financial technology and enhanced banking experiences to respond to customer needs for both existing and new market segments especially small and medium enterprises.”
Prasac offers loan, deposit, payroll, money-transfer, retail point-of-service (POS) and mobile-banking services. It lends to groups and individuals for consumption, housing, renewable energy, vehicles and education as well as micro-, small and medium-sized enterprise.
LOLC Group, which is a unit of the Japanese conglomerate Orix, has operations in a range of industries in Africa and Asia. The group plans to retain its 97-percent stake in the microfinance institution LOLC Cambodia. It also offers microfinance services in Indonesia, Myanmar, Nigeria, Pakistan and Zambia.
Sources and Additional Resources
Prasac press release
https://www.prasac.com.kh/en/news-and-event/prasac-welcomes-new-shareholder-to-support-growth
LOLC press release
https://www.lolc.com/news-readmore?news=302
KB Financial Group homepage
https://www.kbfg.com
More news on Cambodia
https://www.microcapital.org/?s=cambodia
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