IFC proposes $40m COVID-19 loan to Cambodia’s Hattha Bank

The International Finance Corporation (IFC), a member of the World Bank Group, has proposed to invest up to $40 million in Cambodia’s Hattha Bank, formerly Hattha Kaksekar Limited (HKL), to support the bank’s financing to MSMEs.

The investment, in the form of a seven-year subordinated loan, aims to help strengthen the bank’s resilience amid the ongoing COVID-19 pandemic and support Hattha Bank’s long-term strategy of providing lending to MSMEs in Cambodia, with a good portion of the financing targeted at women-owned businesses.

The proposed loan comes nearly a year after IFC invested $25 million in the bank in the form of a senior loan. IFC has been investing in Hatta Bank since 2015.

Hattha Bank, the second-largest microfinance deposit-taking institution in Cambodia, has been operating in the country for over 26 years as HKL. It obtained a licence to operate as a commercial bank from the National Bank of Cambodia in August 2020.

The bank currently has a total asset of about $1.6 billion and gross loan portfolio of about $1.3 billion. The Bank has a nationwide presence with 177 branches in 25 cities and provinces, the second-largest network in Cambodia.

IFC said the proposed sub-debt consists of IFC’s own account investment of up to $10 million and mobilisation of up to US$30 million, to primarily support the bank’s financing to MSMEs and WMSMEs.

The project will contribute towards narrowing the MSME financing gap by providing additional loans to MSMEs including WMSMEs during the tenor of the loan, IFC said in its disclosure.

“This is expected to increase economic activity and job creation in Cambodia to expedite post-crisis recovery,” it added.

Cambodia has more than 450,000 micro-entrepreneurs and about 27,500 SMEs, generating about 1.6 million jobs.

The proposed loan to Hatta Bank is part of IFC’s $8 billion facility that seeks to fast-track financial support to existing clients to help sustain economies and preserve jobs during this global crisis.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.