A Member of PhillipCapital Group, Singapore
Standard Building of KREDIT Microfinance Institution Plc.
ANNUAL REPORT 2013 Contents HIGH INTEREST RATE
UP TO Pages
4 Vision, Mission, and Core Values
5 Performance Highlights
7 Operating Provinces
8 Business Environment Review
9 KREDIT's Overview
10 Message from Chairman
11 Message from CEO
12 Organization Chart
13 Shareholders
14 Board of Director's Profiles
17 Committees at Board Level
20 Executive Committee
23 Staff Capacity Development
26 New Core Banking System
27 Our Products and Services
32 Operational Performance
36 Social Performance Management and KREDIT
39 Our Lenders, Partners, and Network
41 Listen to Our Staff, Partners, and Clients Talking about KREDIT
43 Awards Received Within 2013
44 External Audit Report
61 Contact Us ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Vison, Mission and Core Value Performance Highlights
Vision INDICATORS YEARS Operational Performance 2011 2012 2013 Number of branches 10 12 13
To contribute to the social and economic development of communities by Number of sub branches/units 48 56 66 enabling the economically active poor to improve their lives. Number of districts covered 90 101 110 Number of communes covered 661 745 857
Number of villages covered 4,216 4,631 5,402 Mission Loan outstanding (in mil USD) 44.59 53.498 74.202 Active borrowing accounts 56,519 60,905 73,115
PAR 30+ 0.33% 0.26% 0.28%
To be a reliable and well known financial institution that provides diverse and Active saving accounts 1,254 3,358 9,023
innovative financial solutions to communities, serving and protecting our Values of deposit collected (in mil USD) 3.43 8.952 16.217
clients while maintaining organizational sustainability with a commitment Total staff 717 848 1,014 to the poor. Financial Performance 2011 2012 2013 Total assets (in mil USD) 49.03 64.55 87.38
Total equity (in mil USD) 9.79 11.26 16.78
Core Values Return on equity (includes grant) 21.04% 16.37% 18.65%
Return on equity (excludes grant) 17.80% 13.91% 16.90%
Commitment: Working hard to achieve service excellence Return on assets (includes grant) 4.12% 3.03% 3.44% Return on assets (excludes grant) 3.5% 2.58% 3.12%
Integrity: Doing what is right Net profit after tax (in mil USD) 1.76 1.72 2.61 Operational self-sufficiency 123% 118% 123%
Team work: Working together to achieve one goal Social Performance 2011 2012 2013 Borrowers from rural areas 71.32% 93% 91%
Responsibility: Being accountable for our actions Average loan size compared to GDP per capita 86.80% 94.6% (or USD894) 98% Women borrowers 91.93% 91.96% 90.42%
Unsecured borrowers (without collaterals) 22.99% 29.61% 32% Dignity: Showing mutual respect for all Voluntary savers with value below and equal GDP per capital 71.18% 55.84% 83%
Women savers 47.53% 74.44% 58% Transparency: Working clearly and ethically Client’s retention rate 88.09% 86% 89%
Communication: Relating in an open and friendly way to all With the direction from the board, KREDIT has put more focus on poor clients by making increases on their percentage from one year to another: 22.99%, 29.61%, and 32% for 2011, 2012, and 2013 respectively. This Christian faith: Acting in accordance with Christ’s love market share is big and they are a group who really need micro financial services.
4 5 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Performance Highlights (Continued) Operating Provinces
SOCIAL PERFORMANCE TOOLS AND MECHANISMS Poverty Targeting and Monitoring Bi-Annually produce and share with BoD, shareholders, lenders, and Social performance reporting others through different channels. Customer Care and Product Enhancement Prices, terms and conditions of all financial products are fully disclosed to the customer, including interest charges, insurance premiums, Laos minimum balances , all fees, penalties, linked products, 3rd party fees, and whether those can change over time. Staff are well trained to inform and explain these to clients. Multiple channels for disclosing clear and Oddor Meanchey accurate information: brochures, orientation sessions, meetings, posting Transparent pricing information in the branch, websites, etc. Loan contracts (1) show an Preah Vihear amortization schedule that separates principal, interest, fees; (2) define Banteay the amount, number and due dates of installment payments; and (3) Meanchey Steung Ratanakiri include fees and conditions for early repayment, late payments and Siem Reap Treng default. Debt collection practices are revealed to the borrowers prior to
the time of sale. Battambang To n Client satisfaction survey Conduct yearly or every 2 years. le S Staff are assigned to receive complaints via telephone and resolve issues Pailin a Client feedback system p Kampong Thom that are being raised by clients. Client satisfaction, clients’ exit, competitor matrix survey regularly Modolkiri Market research for product development conducted to provide better products and more convenient services for Pursat Kratie the clients. Kampong Non-Financial Services Kampong Cham - 4,533 clients received special agriculture training. Chhnang - 8,751 clients received child education training along with 6,766 of educational reading books given. Phnom Penh - About 4,000 units of helmet produced and given to saving clients Koh Kong Kampong Prey Veng and staff. Daily radio program on safe traffic program is continued with Speu Kandal Vietnam Social responsibility activities National Radio. Become the single Cambodia MFI. - 5% of the yearly net income is set aside to the community development T Takeo Svay Rieng programs. hailand - Outstanding loans from VSU Clients are written off when the borrower passes away; and KREDIT also gives grants to the family to assist in Sihanouk Ville Kampot funeral arrangements. Kep 20,404 clients received finance related training from KREDIT which includes Financial literacy program Operating Provinces saving, budgeting, and household income and expense management. Potential Provinces - Endorsement with Smart Campaign and selected by Cambodia Microfinance Association (CMA) and Agency French Development (AFD) to enhance client protection principles (CPP). - Received 2 Awards from Kiva: Facilitation of Savings and Client Voice Others - Have just become a member of Banking With The Poor (BWTP). - Got “Most Innovative Non - Profit / Social Enterprise” Awards from Singapore Venture Capital and Private Equity Association (SVCA) 21st Anniversary Gala & Awards Dinner for the year 2013. Personnel Policies - Conducted & updated yearly. - Good HR policy in place and yearly updated based on industry study Employees satisfaction survey making sure that our benefits are competitive at the market. - Staff turn- over rate for the last 6 months 7.18%. Other policies Whistle blowing policy and environmental and social policy.
6 7 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc. Business Environment Review KREDIT Overview
In 2013, Cambodia's economy achieved commendable minimum wage rate for garment workers that will go result with a GDP growth of 7% as forecast by the IMF into effect next year. The Cambodia's manufacturers and the World Bank and 7.2% by ADB even some has also started shifted to higher-value clothing by KREDIT, since its humble beginning in 1993, has grown on the clients lives. KREDIT has continued expansion political issues has yet been solved since the national moving away from producing the most basic clothing to be one of the largest microfinance institutions in of Vulnerable Service Unit (VSU) by working through election in July 2013. However, the ruling and opposition items and diversifying to manufacture more intricate Cambodia. With more than 23 years of experiences, integrated approach with development partners to parties have continued talking for solutions. Despite products for international buyers. KREDIT still focuses on its vision and mission to help provide our clients other complimentary services, forecasting strong growth for Cambodia this year and poor unbanked families ready access to financial help some services provided directly by KREDIT’s staff 7.2% for 2014, IMF also warned of risks posed to the The total weight of cargo transported through Sihanouk to improve their lives. This includes free non- financial while some by our partners based on topics and their country's economy by the anticipated winding down Ville Autonomous Port in the first 10 months of the year service such as cash flow and money management and specializations. You will find our complimentary services of the US Federal Reserve's quantitative easing. The increased 16% compared to the same period last year. starting micro business know-how training under our in below point talking about KREDIT’s social report. total GDP of the countries about USD15.191 bil or About 2.48 million tons of goods passed through the integrated approach with many different development The complimentary services is provided not only to our USD1, 036 per capita. The inflation rate in Cambodia port to the end of October compared with 2.15 million organizations and partners. clients but to non- clients, local authorities, and staff of was recorded at 4.18 percent in October of 2013 by the tons during the same period in 2012, was due largely our partners. National Institute of Statistics of Cambodia. to an increase in rice exports and construction material As of Dec 2013, with a total asset of more than imports. USD87.65 millions, KREDIT has provide loans to Under the partnership approach, KREDIT has Cambodia's trade reached a total of USD15.9 billion in more than 70,000 families, collected savings from innovative products and services that allow our rural 2013, equaling an 18% rise from 2012. Exports were Banks and MFIs Performance 7,800 depositors in 16 out of 25 provinces and cities of clients to have better access to basic necessities for valued at USD6.9 billion, up from USD5.5 billion, with Cambodian bank and microfinance market has garment and textiles accounting for more than 80% of continued its growth with more increase in their Cambodia. daily uses such as loan for latrine, loan for water filter, the whole. Meanwhile, Cambodian spending on imports performance and covering more geographic areas of and loan for education, etc. such as petrol, vehicles and construction materials Cambodia allowing our people to experience with many Our shareholders are Phillip Capital Singapore topped exports, increasing from USD7.9 billion in 2012 more different financial services and technologies. and World Relief USA. KREDIT with its dynamic Having seen the commitment and real programs and to USD9 billion in 2013. and pragmatic board and management teams and activities done, KREDIT got very high appreciation According to the report of the National Bank of committed employees have achieved triple- bottom from clients, local authorities, national and international The Cambodian Ministry of Commerce had granted Cambodia (NBC), lending at the kingdom's 34 lines embracing sustainability and enabling its clients partners, lenders, and also won recognition awards operating licenses to 2,223 new companies in the first commercial banks rose from USD5.88 billion in 2012 to achieve socio-economic development by following from different partners. nine months of 2013, downed 14.6% compared with to USD7.4 billion, receiving deposits totaling USD7.74 and practicing Christian beliefs to maximize the impact 2,606 new firms over the same period last year. The billion, up 14% from USD6.8 billion a year earlier. Last Ministry had registered 1,118 foreigner-owned firms, year, the banks lent USD712 million to agriculture, up downed 9% year-on-year, and 1,105 local Cambodian- 29% from USD552 million a year earlier. owned companies, downed 20%. The pool of outstanding loans held by Cambodia's In 2013, numbers of visitor's arrival to the country microfinance institutions (MFIs) grew to more than was recorded increased 17% from the last year or 4.2 USD1.325 billion in 2013, marking a 49% industry-wide mil. The estimation of construction investment was increase from 2012, when the figure stood at USD890 USD1.52 bill or 50.20% up from the last year. million. Consumer deposits grew more than 59% to Cambodia approved domestic and foreign investment reach USD444.98 million last year, up from USD280 projects worth USD4.9 bill in 2013, up 69% from million in 2012. USD2.9 bill. Non-performing loans accounting for less than 1%. Cambodia exported rice with a total amount of 378,856 Even though most banks are only available in the cities tons which was 84% increased and 2013 was the and provincial towns but a few MFIs have now operated second year in a raw that Cambodian rice got "the nationwide with many more physical offices. world best rice award" and become attractive by foreign countries; however, the chair of Cambodian rice export Commercial banks have likely gone down market to association raised that there are still challenges for smaller while a few MFIs have started to go upmarket 1- million ton goal in 2015 such as transportation, rice their products to serve higher level market. More seed, and loan from the bank. than that some local banks are eyeing on expanding oversea. Transfer service, ATM, mobile banking, E- The value of Cambodia's garment and footwear exports banking have been introduced and used by our people. topped USD5.07 billion in the first 11 months of 2013, Some foreign parties have also entered into the market an increase of 22% over the same period last year, four with partial or complete acquisitions of local banks. subcommittees formed to begin establishing a new Cake-cutting ceremony during KREDIT’s 20 year anniversary. 8 9 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc. Message from Chairman Message from CEO
Mr. TIMOTHY MARK AMSTUTZ Mr. CHAN MACH
Chairman CEO
I bring you warm greetings and best wishes for success of KREDIT. We are fully committed to the financial Despite some political issues after national election in starting from the development of policy, procedure, on behalf of the Board of Directors and Shareholders of and social protection of our clients, and are further 2013, the businesses in all sectors have made good risk threshold and report regularly to the board risk KREDIT Microfinance Institution Plc. strengthening our standards for client protection. We growths. Farmers and micro-business people still committee. have established a Community Development Fund need more capital for expansion of their businesses On behalf of the Board of Directors of KREDIT MFI, within KREDIT to complement our financial services allowing KREDIT to grow and serve many more clients As an MFI originally moved from an NGO lending it is my honor to once again greet you and present to and help meet the social, health, educational, and in broader coverage areas. project, we have never forgotten our social vision and you this 2013 Annual Report of KREDIT’s performance developmental challenges in the communities we mission. Our finance and non-financial services have during the past year. serve. We have funded several village infrastructure So today I would like to bring all stakeholders and readers been continuously studied, adjusted or developed to fit improvement projects such as digging wells and to pay attention and recognize our achievements for to the need of our target clients. Social Performance In this past year we have observed significant shifts renovation of a canal to provide a sustainable the year as below: Management Committee at the BoD level was also in momentum and responses in Cambodia’s political source of water to rice paddies. We have provided successfully established with clear charter and run landscape. We have seen the hopes and aspirations of enhanced financial literacy training to 87% of our most In the year, our loan outstanding grew for 39% from smoothly. Environmental and social policy already the Cambodian people rise as they seek new ways of economically vulnerable clients so that they equipped 53.49million to $74.20 million, the borrowers growth approved by the BoD. Training on social performance responding to entrenched societal problems. We have to succeed as small scale entrepreneurs. We are about 20% and saving collection also increased by management and client protection principle have been seen changes in the response of government – both working in partnership with Handicap International to 81% from $8.95million to $16.21million. also trained some of our staff and will be continued positive and negative – as they recognize the impact of provide specialized outreach and services to clients for the following years. Partnership with development these political shifts. All of these political developments with disabilities. The existing lenders and new lenders have continued NGOs have been strengthen and expanded to provide remind us that politics cannot be separated from the supporting us with their loans; more than that, our more complimentary services to the clients. More economic, social, and physical needs and aspirations Fulfilling KREDIT’s social mandate requires a strong shareholders strongly supported by making more than that, with 5% to 10% of our yearly net profit after of the Cambodian people. They desire and deserve financial foundation. The Board of Directors is therefore capital injection to support our growth and investments. tax from the shareholders, in year 2013, KREDIT justice in all aspects of life. Cambodia will prosper as a proud to present to you the results of KREDIT’s With this great support, guidance from BoD, and has supported a lot of projects such as digging well nation and as a people only insofar as there is justice financial and economic empowerment performance in commitment from all levels of staff and management, for villagers, channel renovation, and building village- and fair treatment for all. this Annual Report. We continue to see steady year on KREDIT made a good net profit after tax up 52.36% based kindergarten, etc. year growth in KREDIT’s portfolio of loans outstanding, (amounting $2.62 million) compared to 2012 which was KREDIT is committed to these same principles of registering a growth in portfolio of nearly 39% in 2013, only $1.72 million. With the achievements, I would like to express my justice and fair treatment, as well as compassion, to more than USD 74 million. KREDIT’s Operating Self sincere appreciation and thanks to our shareholders, empowerment, and sustainability of Cambodian Sufficiency was 123% in 2013, providing needed funds To enhance our core banking capacity and to better board of directors, regulators, creditors, management families and communities. It is these values that drive to expand its reach to new areas of service. serve the clients, KREDIT decided to equip with the and staff; especially clients and other business partner our goals and priorities as a microfinance institution. Please join me in congratulating the CEO, Senior World top core banking system “Oracle Flexcube”. The that always support us. On behalf of management As a result, the Board of Directors of KREDIT has Management, and all the staff of KREDIT who have given particular attention during this past year not only worked tirelessly in 2013 to achieve KREDIT’s mission project has started since August 2013, and with support and staff, we commit providing better services with to the economic empowerment of our clients, but also and strengthen the economic and social framework of from implementation team from BFSI, India and the varieties of products and services which are the needs to their social welfare and community empowerment. Cambodian society. commitment from management and staff at all levels, of our clients by using the top technology so that Just as the current political environment reminds us we have moved as timeline and sound manageable, we can contribute to the community and economic of the interdependence of all aspects of life, KREDIT With best wishes for continued success and fulfillment did go lives for 3 sub branches and HQ and plan to go development of Cambodia. recognizes that the economic progress of families must of the hopes of the Cambodian people, live fully by end of 2014. be rooted in a commitment to justice and empowerment in the social and physical needs of the families and Regarding risk management, after being established in communities that it serves. 2012 and with support from the board risk advisor and some of our partners, we have enhanced this function These values and priorities are the focus of the Social Performance Committee of the Board of Directors 10 11 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc. Organization Chart Shareholders
As of Dec 2013, KREDIT has 2 shareholders: Malaysia, Cambodia, Indonesia, Thailand, Hong Kong, PhillipCapital Group and World Relief Corporation. China, Japan, India, Sri Lanka, Australia, UAE, UK, France, Turkey and USA. Phillip MFI Pte Ltd, A member of PhillipCapital Group World Relief Corporation Since 1975, the PhillipCapital network has grown into an World Relief works alongside local churches and integrated Asian financial house with a global presence communities on four continents to serve the most that offers a full range of quality and innovative services vulnerable. Partnering with like-minded organizations, to retail and high net worth individuals, family offices, World Relief extends its reach into many of the corporate and institutional customers. poorest and least developed nations on earth. We empower and assist 2.8 million people annually. World Our comprehensive suite of financial products and Relief focuses on Maternal & Child Health, HIV & AIDS, services includes broking in securities, futures, foreign Child Development, Human Trafficking, Agriculture and exchange, bonds, precious metals and commodities, Food Security, Disaster Response, and Microfinance unit trusts, contracts for difference, exchange traded in countries such as Burundi, India, Nicaragua, funds; fund management, managed accounts, Cambodia, Indonesia, Rwanda, China, Kenya, South insurance planning, regular savings plan, investment Sudan, Congo, Kosovo, Zambia, Sudan, Malawi, Haiti, research, equity financing and property consultancy*. and Mozambique. Institutions can also benefit from our corporate finance and advisory services as well as information technology And as agreement from the shareholders, another solutions. shareholder of KREDIT is planned to be established soon, named KREDIT’s Staff Association (KSA). KSA’s With more than 3,500 employees and over 900,000 Board of Directors have already elected through clear clients worldwide, our assets under custody/ voting process from all eligible KREDIT’s staff and the management totals to more than USD 24 Billion with drafted Article of Association (AOA) of KSA was also shareholders' funds in excess of USD 1 Billion. done and waiting to be finalized from KSA’s BoD. So, we hope that KREDIT will have 3 shareholders in the PhillipCapital (with headquarters in Singapore) operates near future. in the financial hubs of 16 countries, including offices in
2013 2012
67.43% 58.15% Shares 67,034 Shares 44,984
2013 2012
32.57% 41.85% Shares 32,380 Shares 32,380
12 13 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Board of Directors' Profiles Board of Directors' Profiles( Continued)
TIMOTHY MARK AMSTUTZ, Chairman TAN TECK KEONG MICHAEL, Board member
Mr. AMSTUTZ has been KREDIT’s Chairman since he joined the Board Mr. TAN is currently Director, Corporate Development at PhillipCapital. Prior in 2003. He is an American citizen who was born and raised in India. He to joining PhillipCapital and championing microfinance initiatives within the returned to the U.S. to complete his university degree at Wheaton College in Group, he previously held positions in both industry and academia including Illinois, USA. Mr. Amstutz has worked for World Relief in a number of positions stints as Assistant Professor at University of Nevada, Reno, United States, since 1982, including various U.S-based positions. He was responsible for Lecturer at National University of Singapore, and various IT management and launching and leading a number of ground-breaking programs for World Relief consultancy positions in Singapore. He holds a PhD in Information Systems in Chicago, including its Legalization and Immigration programs, its Education from the National University of Singapore, a Certified SAP Consultant (Project Services program, and ultimately World Relief’s National Immigration Resource Systems) certification from SAP Germany and a CDipAF (Accounting and Network of which he was the Founding Director. During this time he also served Finance) qualification from ACCA (UK). as Midwest Regional Director for World Relief’s U.S. operations. Mr. Amstutz moved with his family to Cambodia in 2001 to serve as Country Director for World Relief Cambodia. Since 2007, he has served as Asia Regional Director, SREYHEM ROBERTS, Board member overseeing World Relief’s work in Cambodia, Indonesia, India, and China, and has recently transitioned back to serving as World Relief’s Cambodia Country Mrs. ROBERT is a Cambodian/Canadian national with over 20 years of Director. Mr. Amstutz’s broad management and leadership experience experience working and consulting with NGOs and businesses in Cambodia. has provided a platform for him to speak and lead seminars at numerous Her professional activity in the non-profit and business worlds includes conferences and events on topics ranging from non-profit board development administration, human resources management, accounting, business and non-profit management, to leadership development and microfinance. Mr. development, and project management. She is working as a General Manager Amstutz lives with his family in Phnom Penh, Cambodia for First Trust Co;Ltd, a property holding company.
ONG TEONG HOON, Shareholder Representative and Board Member
ING VARONY, Board member Mr. ONG started working in the financial sector in 1977, first as a Money Broker and then, after a year, with Standard Chartered Bank, as a Ms. ING is a Cambodian national holding master in Public Administration Management Trainee. For 25 years with the Bank, he had been through all from the University of North Texas, Denton, USA and University of aspects of Commercial Banking, apart from Treasury function and he ended, Cambodia in 2005. She has twenty five years of experience working with his banking career as Country Manager for the Bank in Cambodia in 2002. NGOs/International organizations, especially the United States Agency for This was after being the Bank's Chief Representative in Myanmar and before International Development (USAID) where microfinance institutions were that, Regional Manager, Asia Pacific Region covering Financial Institutions. her main responsibility. Prior to that, she worked in the Poverty Reduction Almost immediately after that, he joined Phillip Securities Pte Ltd and had and Economic Management Unit (PREM) a World Bank program where the covered various functions, including a stint in Phillip Securities Thailand PLC financial reform program was introduced to the Ministry of Economy and as its Ag CEO and was last, the Director OTC Capital prior to being assigned Finance and Councils of Minister. She has six years work experience with to KREDIT PLC in 2012. the Cambodian government, Ministry of Industry, Mine and Energy, where she helped in developing the manufacturing public sector. Varony has spent with Mr. Ong is a graduate from the University of Singapore with a Bachelor of Hagar International for five years as Programming Manager who managed two Business Administration and an Associate of the Chartered Institution of main programs. She is currently Senior Manager, The Harpswell Foundation Bankers since 1978. (HF).
14 15 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Board of Directors' Profiles( Continued) Committees at Board Level
There are 3 committees at the BoD level including: Audit Mar, May, Aug and Nov 2013; Committee, Risk Committee, and Social Performance - The Audit Committee has approved the annual internal TEA CHANSOTHEARY, Board member Management Committee. audit plan for the year 2014; - Internal audit department reports directly to the Audit Committee Board Audit Committee; Mrs. TEA is a Cambodian national who has been involved in the Cambodia Responsibilities of Audit Committee - All key operational, business and management process microfinance sector since its infancy more than 20 years ago. She has a broad The Audit Committee is the responsibility of the Board are audited according to risk-based methodologies wealth of experience having worked for a number of institutions covering of Directors and is required to perform the following which provide independent and objective assurance nearly every level of operations including training, human resource, finance general functions: over the adequacy, sustainability, and effectiveness of and audit and various senior management positions. She also served as a - Establish and monitor compliance with a corporate the company’s governance, internal controls and risk board member for various institutions and as a shareholder representative. code of conduct; management process; Beside microfinance, Sotheary have served as finance manager for Hagar - Monitor procedures for compliance with government - Internal Audit examines the strategies of the company international; country manager for the Ratanak Foundation which is based in regulation; the adequacy and effectiveness of the relevant policies, Vancouver, Canada. - Review the findings of audits or examinations procedures and regulatory guidelines; conducted by other agencies; - Internal Audit discusses the result of all assessments She has done consulting work in Finance, Audit, Development and - Discuss disagreements between internal or external with management and reports its observation/findings, Microfinance both within Cambodia and internationally for organizations such auditors and management; recommendations and opinions, via a structured - Inquire about the external auditor’s opinion on the process, to the Board Audit Committee; as World Vision, Child fund, World Relief, PACT, JICA and UNDP. Currently competence of financial and accounting personnel and It is the opinion of the Committee that the internal she resides in Yangon, Myanmar where she takes care of her family and does the internal auditors; controls, audit procedures and risk management freelance consulting. - Review the adequacy of internal control structures processes are adequate to safeguard the company over financial reporting; and to provide sufficient assurance and integrity of the FONG KIM CHOY (PHILIP), Board member - Oversee the company’s internal controls for financial accounts; safeguarding its assets; In 2013, the Internal Audit Department conducted - Evaluate the internal auditor’s objective; 137 assessments in which (134 assessments are the Mr. FONG currently the Managing Director and Principal Trainer of JM_Asia - Review the internal auditor’s work and assess their operational scopes, 2 assessments as financial scopes Cambodia) Pte.,Ltd a marketing and branding consultancy and soft skill performance and capacity building; and 1 assessment as the IT scope) training firm with offices in Singapore, Malaysia, China and New York. He is - Ensure that the internal auditor’s involvement in business consultant, personal mentor & coach to several wealthy business auditing of the financial/IT and operational scopes are Risk Committee owners and businesses. well-coordinated and implemented; Risk Management Structure Step by step, the risk management structure becomes He has positions of Country Manager for Kristlite Cambodia, Chief Marketing Activities and Achievements of the audit committee full and stronger consisting of 1 board risk committee Officers for Hagar International and OnLine.Com, besides other corporate for the year 2013 and 3 committees at management level. experience with American MNCs and Singapore companies listed in the SGX - The Audit Committee met four times during the year in and HKSE. Philip has more than 35 year experience in a variety of senior management positions across industries: IMPEX Trading, F&B, Marketing & Branding Consultancy, furniture manufacturing and distribution, and managing Risk Management Board Risk Board Level large scale events. Committee Advisor
DANIEL JOHN BROSE, Board member
Operational & Assets & Liability Credit Risk Mr. BROSE is the Africa Regional Director for World Relief. Dan has previously Management Level Compliance Risk Committee (ALCO) Committee (CRC) served World Relief as Country Director in Rwanda and Burundi, Africa Great Committee (OCRC) Lakes Regional Director, and Sr. Program Advisor. Dan graduated with an
MS in Chemical Engineering at Stanford University, and he worked for 15 Financial Risk Credit Risk Operational Risk years in the pharmaceutical research industry before joining World Relief in - Liquidity Risk - Credit Policy - Process Transaction Risk - Interest Rate Risk - Credit Approval - System Risk 2001. Under Dan's leadership, World Relief's activities in the Africa Great Covering Risks - FX Risk - Portfolio Management - Fraud Risk Lakes region grew from one country program in Rwanda to significant country - Product Risk - Collateral - Business Contingency programs in Rwanda, Burundi, and Congo; microfinance institutions were - Others - Others Plan (BCP) - Etc grown and launched in Rwanda, Burundi, and Congo; and Ikirezi Natural Products, SA was launched in Rwanda to pioneer the sustainable production of high quality essential oils to benefit poor rural farmers. Dan currently serves Reputation and Regulatory on the board of directors of Urwego Opportunity Bank in Rwanda. 16 17 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Committees at Board Level (Continued) Committees at Board Level (Continued)
Roles of Risk Management Committee was in a good position at 99.78%. Social Performance Management Committee program's and initiatives are carried out professionally Overall function of Risk Management Committee 3. Operational and Compliance Risk Committee (SPMC) and prudently; and to ensure the results and impact of (RMC) is to identify, understand and assess risks that (OCRC) these funds disbursements are an integral part of the can lead to server impact on the organization and their Operation risk is just approved by Risk Management Roles of SPM committee management report to the Board regularly; likelihood of occurrences. Committee. This new committee focuses on Even though the committee has just established in - Validates action plans and budgets related to SPM, 1. Assets and Liability Committee (ALCO) managing all operational risks such as Fraud Risk, 2013, but it has functioned well and actively in the and monitors their implementation of the activities and ALCO committee meets on monthly basic to discuss Process Transaction Risk, System risk, HR risk, following authorities: program; and make decision on various aspects of financial risk Business Contingency Plan (BCP), etc. In addition - Sets clear goals and objectives and creates strategy - Monitors the trend of the endorsed indicators in the management, particularly, liquidity risk, interest rate to implementation of existing internal control more to ensure that the Board of Directors, Management, and context of market and country developments, and to report to the Board on any significant changes, analysis risk, FX risk, and other concerned financial risks. In effectively and efficiency, the committee has decided Employee are aware of the goals and objectives and of the causes of key changes as well as to recommend every meeting, financial performances and financial risk to test and roll out Risk Control Self- Assessment committed to achieving them and in line with universal standard report of SP of social performance task force appropriate plans and actions to ensure KREDIT keeps indicators (liquidity ratio, solvency ratio, Debt covenant, (RCSA) to branch and department level. Also, Business (SPTF) and best practices in community development to the core of these social performance expectations market risk ratio, etc) were reported and discussed Contingency Plan (BCP) is in priority of Operation and principles; and achievements; with some action taken as needed. As a result, most of Compliance Risk Committee. - Creates and reviews Social Performance Indicators those indicators are well managed and risk position is to ensure they remain relevant to the strategic growth Achievement of Social Performance Management in a safe zone. Achievement of Risk and Compliance Department of KREDIT; Committee 2. Credit Risk Committee (CRC) or Credit Committee for year 2013 - Studies, initiates, proposes and implements relevant - Created social performance and community (CC) - Risk Management policy was approved by Board risk and impactful initiatives and projects or programs to development fund away from KREDIT’s account and Committee Besides the daily loan approval, Credit Risk Committee achieve both the short- term and long- term social the clear charter in using the fund; has met in quarterly basic to discuss and take action on - Some risk indicators were added into Risk appetite performance goals of KREDIT; - Approved the support 5 water pumps: 4 in Sa Ang some potential credit risks. In the meeting, some issues and reported - Comes up with some measurements tools to measure District under partnership with World Relief Cambodia were discussed and reported such as Portfolio at Risk, - Operational Risk committee was approved by Board and track the social performance activities of KREDIT and 1 in a primary school in Samakimean Cheuy loan trend, loan procedure update, issues on lending, risk committee approved by the BoD; district, Kampong Chhnang province; and some actions taken. - Quarterly report to Risk management committee - Establishes working groups with a specific task and is - Supported a channel renovation in Tik Pos district, Generally, credit risk remains the most fundamental risk - AML and Combating Financing to terrorists (CFT) authorized to take any independent professional advice Kampong Chhnang province to which the lending industry in general and microfinance policy was updated and approved by Board as it considers necessary to assist the Committee; - Support the repairing of kindergarten at Kampong industry. Portfolio at Risk (PAR) especially PAR>30 is - Cash Transaction Report and Suspicious Transaction - Manages the budget, current year and accumulated Tralach Sub-Branch, Kampong Chhnang Branch closely monitored on continuous basis. At the end of Report were regularly reported to Financial Intelligent funds, approved by the Board and set aside by - Approve Environmental and Social Policy 2013, the overall performance of loan portfolio quality Unit (FIU). management of KREDIT to ensure the various strategic - 2 times meeting to see the social reports and proposal
MICHAEL GOH Singapore Institute of Directors and Board Member Board Risk Advisor has of Risk Management Association. His commercial 25 years of experience in business experience are wide ranging including financial institutions across Corporate Asia Pacific with expertise in Credit, Risk Management Development Director for PE investments, Risk Advisory & Corporate Governance. Consultancy Services and delivering Banking & Risk He held Senior Management Management Training Courses in Asia. He is also positions in global financial currently an Independent Director/Chairman of Board institutions: Chief Risk Officer Risk Committee of MFI in Cambodia. - Asia Pacific Region for AIG Group, Chief Credit & Risk Officer for the JV between global technology group Michael joint KREDIT as Board Risk Advisor Joint in and Standard Chartered Bank and Senior Regional July 2012 and resigned May 2014 Head, Credit & Risk Management, for European and Hong Kong banks. During the mission with KREDIT, Michael injected insights to the start- up of this new functions and other He is a CPA, has Masters in Finance, Baruch College, fields. We would like to take this chance to thank for his NY and is an adjunct Senior Lecturer for UOL LSE valued inputs to the start- up. We hope that this function International banking programs. He is a Member of will implement well in the near future.
KREDIT’s CEO gave helmets and funds to Cambodian Red Cross to contribute to road traffic accidence in Cambodia. 18 19 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Executive Committee Executive Committee (Continued)
Being led by the CEO, KREDIT’s Ex- Com consists of plan (strategic framework) and making sure that the the CEO, CFO, COO, Head of HR Department, Head of institution achieve the plan. The team is also a unit that Marketing Department, Head of Business Development draft policies and strategies for BoD to have a review, Department, Head of Branch Support Department, make comments and approval. The team also has a SOUNG ENG CHHAY , Head of Internal Audit Department Head of Finance Department, Head of Internal Audit role to provide leadership to KREDIT’s staff as whole to BBA in Management and MBA in Management. 18 years of experience with Department, Head of IT Department, Head of Treasury meet the institutional goals. MFI in Accounting, Branch Management and Auditing. Department, and Head of Logistic and Administration Department. Ex-Com will hold meetings one a month and special meeting can be held at any times as needed. With the direction from the BoD, KREDIT’s Ex-Com is responsible for preparing the annual strategic
HUY BUNHUOT, Head of HR Department
CHAN MACH, Chief Executive Officer (CEO) - 2 Bachelors: in Law and in Education - Master in Development Management MBA in Management, MFB, and Bachelor in Mathematic. 18 years of 14 years of experience with MFI in Admin and Human Resources Management experience with 15 years in MFI in Audit and Training as well as Branch Management and Operations Management and Math teaching.
HEANG KIM, Head of Marketing Department
HIM VIBOL, Chief Finance Officer (CFO) BBA in Marketing and MBA in Management. 12 years of experience with MFI Bachelor in Economics, MBA in Finance and Accounting, pursuing ACCA. 11 including work in Management of Marketing, Research, Customer Service, years of experience with MFI in Audit, Accounting and Finance Management. Fund Mobilization and Partnership Relation.
PO YORT, Chief Operations Officer (COO) SOK KIMCHHAY, Head of IT Department
Bachelor in Accounting and Finance, MBA in Management. About 16 years Bachelor in Computer Science, MSIT, and pursuing a Certified Accounting of experience in Accounting, Admin, Training and Human Resources, and Technician (CAT) from UK. 10 years of experience in IT management with Operations Management. MFI.
20 21 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Executive Committee (Continued) Staff Capacity Development
Within the year, KREDIT has continued its training to our staff who have a long-term commitment with provision with a clear training curriculum set. All new KREDIT. staff is required to be trained clearly and carefully before ROM VANARA, Head of Branch Support Department they start performing the jobs while some refresher Internal Training – refers to the internal training High Diploma of Accounting & Finance, B. ED in English, MBA in Finance and training provided to old staff. This is to make sure that courses designed and provided by training and capacity Banking. 12 years of experience with MFIs in Micro Credit Lending, as well as staff is competent enough to perform their job with high building unit and others department of KREDIT based Branch and Operations Management. quality of service. Some training is provided by our on the institutional training need analysis, the internal training unit team and some provided by professional training program includes (orientation course, basic trainers outside the organization. In addition to the course, short course, and specialized course) short course training, degree schooling is also provided
Orientation and Refresher Training
HAY VANHOM, Head of Finance Department Nº Course titles # of courses # of participants Bachelor in Accounting and Master in Auditing. 11 years of experience with 1 Staff orientation round 1 9 175 MFI in Bookkeeping, Auditing, and Accounting and Finance Management. 2 Staff orientation round 2 3 107 3 VSU loan product orientation 5 57 4 Field promotion orientation 1 9 5 Orientation for CSO transfer OT 1 24 6 Refresher on loan policy 3 184 KER MAKTHURA, Head of Treasury Department Total 22 556 Bachelor in Finance and Banking and pursuing MBA. 12 years experiences in MFI starting from Credit Operations, Cashiering, Accounting, and Treasury Management. Internal Short Course Training
Nº Course titles # of courses # of participants 1 Help desk system 2 36 2 Customer care training 19 587 EAR NHAR, Head of Logistic and Administration Department 3 Unit online 1 13
- Bachelor in Accounting 4 Make-up class 21 233 - Master in Finance 5 Banking products 1 32 11 years experiences in administration with NGOs and 5-years with MFI, including insurance for staff. 6 Anti-money laundering 6 334 Social performance management and client 7 6 222 protection principle 8 SME loan training course 1 18 9 Saving policy for loan and saving officers 6 223
HONG RY, Deputy Head of Risk and Compliance Department 10 Education loan 1 41 11 Saving product for new MDI sub branch 3 46 Master of Business Administration and Bachelor in Accounting. Over 3 years of experience with private company in bookkeeping and accounting and 6 12 New promotion staff training (HT & SBM) 2 36 years of experience with MFI in Auditing and Risk Management. 13 Training of trainer 3 98
Total 22 556
22 23 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Staff Capacity Development (Continued) Staff Capacity Development (Continued)
External Training Course Degree Scholarship Program External Training Course – refers to the training course conducted by outside Training Service Providers outside KREDIT MFI and leads to a certificate of completion or a certificate of participation from those Training Service Local Degree Scholarship refers to the Degree Scholarship that is locally provided by any institutions within Providers. Cambodia that leads to a Diploma/Associate Degree, a Bachelor Degree, a Master Degree, ACCA/CPA Degree, and CFA, COB Degree. Orientation and Refresher Training Nº Description Male Staff Female Staff Total Staff Nº Course # of Staff 1 MBA 9 1 10 1 Accounting 1 2 BBA 0 1 1 2 Advance excel II 1 3 ACCA 1 0 1 3 Advance risk management 1 Total 10 2 12 4 ATM concept training 20 5 Behavioral base interviewing skill 2 Internship and Research Scholar Program 6 Business risk management 3 Internship and Research Scholar Program refers to the university student (Bachelor, Master or Doctor Degree) 7 CAS and CIFRS 2 who is approved to do internship through research in KREDIT MFI for a period of less than 6 months. 8 Child development and parenting skill 2 9 Effective telephone handling skill 1 Nº Offices / Branches # of interns 10 Excel 2010 1 1 Head Office 9 11 Financial risk management 2 2 Siem Reap 17 12 How to determine cost covering interest rate 1 3 Prey Veng 10 13 Internal audit writing 3 4 Soung 13 14 IT assurance & security audit 2 5 Kratie 3 15 Loan contract laws and land laws 6 6 Kampong Cham 67 16 Make-up class 26 7 Phnom Penh 12 17 Managing branch for bank and MFI 2 Total 126 18 Market research 1 19 Market research and financial product development 2 20 Mobile payments and banking 2 21 MS Lync 4 22 Oracle 11 g database administration level 1 4 23 Public relation strategy 4 24 Strategy saving mobilization 2 25 The successful closing sales by personality 3 26 Understanding agriculture production 10 27 English language 23 Total 556
International Training Program For courses that match with the higher level training need of KREDIT and mostly do not exist or cannot be found in Cambodia or are deem compulsory.
Nº Description # of country # of Staff 1 Oversea Training 1 4
KREDIT’s professional staff waiting to serve clients. 24 25 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc. New Core Banking System Our Products and Services
To keep and sharpen its competitiveness at the market, Another core banking team was later on set up to work At KREDIT, we believe that financial service alone is Individual Loan KREDIT seeks and employs many different strategies with the experts of the selected system. More staff, not enough to help the poor clients who are a big part of This loan requires physical collateral and aims at so that we can provide products and services preferred mainly at IT department have been added to make sure our market from the poverty cycle. With this believe and supporting any individual who will use the loan to by the market. One of core strategies selected in 2013 is that we have sufficient internal staff to work out with the to contribute to the social and economic development start up or expand businesses, invest in agricultural new core banking system. KREDIT, with the support of experts. Training on the new core banking system was of communities, KREDIT has provided and continue production, purchase household goods or personal a member of the BoD who is an IT Specialist carefully carefully provided by the experts to our internal team. A providing diverse and innovative finance and non- items, or improve their accommodations. studied to select a new core banking system. A clear timeline was set and followed strictly. Our internal finance services to their clients; with majority living in consultant who had a long- term experience in this staff has devoted their times for this new core banking the rural community using integration approaches with The individual loan represents up to around 91% of field was partnered to help in the detailed process. system despite night time and weekends. So far, different development organizations. the loan portfolio. KREDIT offers the individual loan A taskforce at management level was set up. Many KREDIT has already gone live this new core banking in both KHR and USD currencies. This loan targets different software venders came and made presentation system with 3 sub branch offices plus Head Office and For all of our services, we study and address real needs the economically active poor clients as well as micro of their products and costs. Shortlist was done to select plans to fully go live by the end of year 2014. of our target clients with clear assessment with clients, small and medium enterprises who can present legal the top 3 and finally we got the finalist. The new core staff, and local authorities. collateral. The loan amount varies from KHR200,000 or banking that KREDIT selected is “Oracle Flexcube”, USD 100 to KHR 40,000,000 or USD 50,000 (for loan which is the worldwide-used core banking system With the powerful new core banking system, KREDIT For financial services, KREDIT is providing loan, from USD 10,000 to USD 50,000, KREDIT requires and now is being used by National Bank of Cambodia commits to providing even higher qualities of services saving, local money transfer, and currency exchange. clients to invest at least 60% for investment or business (NBC) and some Cambodian financial players. with many varieties of products and services to our For non- financial service, KREDIT has two main expansion) with a maximum length up to 48 months. clients. We hope our clients will enjoy great experiences programs: permanent and need- based services which The interest rate varies from 3% to 1.4% per month, It is really a big investment for the company costing with this world latest technology leading KREDIT to will be detailed in the social performance part below. depending on the loan amount, type of currencies, about USD1.8 million. KREDIT has carefully moved with grow and serve more clients. repayment location, and also clients’ risk perspective. guidance from BFSI experts of the selected system. Loan Products The interest is calculated by using a declining balance To satisfy client’s preference and market competition, repayment. Clients are offered with different payment KREDIT continuously modifies its existing loan options: monthly principle and interest for business products, studys and also introduces some more new loan and for agriculture loan clients can be: (1) interest loan products. monthly and principal at the end of loan term, or (2) interest monthly and principal pay by every 3, 4, 5, or KREDIT provides small and micro business and 6 months) agricultural loans of a variety of sizes to meet the needs of poor Cambodians and their families for livelihood Our current individual loan product is classified development. KREDIT also offers the opportunity for into different categories depending on the clients’ clients to borrow in either KHR or USD denominations. consumption purposes: business, consumption, Payments can be made at the office or at the village housing improvement, real estates, and agriculture. level. Under the Individual Loan, we have developed specific KREDIT’s core loan product is an individual loan, which loan products to target specific customers, like SME allows clients to structure around their personal needs loan, education loan, and staff housing loan. and ability to repay. SME Loan KREDIT is currently providing four different types of Loan for small and medium-sized businesses is a loan methodologies: Individual Loan, Small Group type of individual loan to promote small and medium Solidarity Loan, Community Bank Loan, and Large enterprises related to production and business services. Group Solidarity Loan (Trust Bank). This Loan require collateral and aim at supporting the financial resources for expansion or starting up new
Server room prepared for the new core banking system. 26 27 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Our Products and Services (Continued) Our Products and Services (Continued)
business. They can use this loan to pay or manage Staff Housing Loan Several groups (with a maximum of 20 groups) form It is a joint-liability group loan that does not require daily operations, such as working capital, for medium Staff housing loan is one specific product developed for a Community Bank Committee. The Community collaterals of the 10-20 members, and it is targeted and long- term investment expansion of the business. our internal KREDIT’s staff who need cash to purchase Bank Committee is headed by an elected Chief which the economically active poor VSU clients who have The target clients of this SME loan are individual and a new house/ land, construct new house, repair house is being assisted by the specialized credit officer/ shown their commitment to use of loans to improve entity/companies. The loan size is from USD 20,000 and/ or house improvement. Loan Size ranges from loan and saving officer. The loan amount in the 1st their standard of living. A group leader is elected by - USD 50,000 (available only in USD currency), loan USD10,000 to USD70,000 or equal to 70% of total cycle is KHR1,200,000 (around USD300), the 2nd members and being assisted by KREDIT’s specialized term is 04 - 48 months, and monthly interest rate is price of the house or land to be bought (USD Currency KHR1,400,000 (USD350), and the 3rd and so on CO. The loan amounts are offered differently from cycle 1.4% - 1.6%. only), loan term is from 12 - 180 months, and interest KHR1,600,000 (USD400). The maximum loan term to cycle, for the 1st cycle KHR500,000 to KHR1,200,000 rate 9% per annum. is 12 months, but determined by the majority vote in (USD125 - USD300), 2nd cycle from KHR500,000 - Education Loan the group. The interest rate is charged at 2.9% per KHR1,400,000 (USD125 - USD350), and 3rd cycle from Education is one of the most important investments that Small Group Solidarity Loan month, using declining balance calculation method KHR500,000 - KHR1,600,000 (USD125 - USD400). can be made in life. Higher studies and specialization It is a joint-liability group loan of 3-5 members, and it is with monthly interest repayment. To help the vulnerable in certain fields call for additional financial support from targeted to supporting the economically active poor in poor people and their family, the loan will be written off Note: To build up clients’ awareness on cash flow and time to time. the rural area who commits to use the loan to improve in case client died; in addition, some amount of money finance management, child-related issues, as well as their standard of living. We do not require the collateral, from KREDIT is also given to clients for arrangement of improvement of agriculture skill, some training provided The educational loan scheme aims at providing financial but client must have own total asset to proof when funeral ceremony. to Community Bank Loans (VSU Loan) and Large Group support to deserving/ meritorious students for pursuing credit officer conduct loan assessment. This solidarity Solidarity Loans (Trust Bank Loan): children education higher education in Cambodia. The main emphasis group loan product is designed for poorer client in rural To encourage loan discipline and cooperation among training, finance- related training, and agriculture skill is that every meritorious student is provided with an areas with willingness to uplift the quality of their lives the community bank members, KREDIT provides training. opportunity to pursue education with financial support and their experiences in household activities such as a benefit of 3% on interest collected to the Chief of with unique characteristics that include affordable trading, farming, animal raising, palm sugar production, each community bank who is supporting KREDIT to Also under partnership with other development conditions and tailored terms. To prevent risk with and services related businesses among others. meet community bank objectives. This supports and organizations, KREDIT has provided these Community longer loan term, we also require physical collateral maintains help collection rates of 100%. Bank Loans (VSU Loan) and Large Group Solidarity with value of total collateral is 100% of loan request A joint liability group loan of 3 to 5 people that guarantee Loans (Trust Bank Loan) some loans for latrine and for (primary collateral value covered at least 75%). In each other in loan repayment can avail a maximum loan Large Group Solidarity Loan (Trust Bank Loan) water filter with hope that the rural community sanitation addition, to encourage student clients who has secure/ amount of KHR2,000,000 or USD 500 per member, To support the VSU Program, KREDIT has developed and hygiene will be improved. permanence job, we also offer special education loan with monthly interest rate of 3% to 2.6% depending on another product which is called the Trust Bank product. without collateral requirement. This product aims at currencies and repayment locations with a maximum academic or vocational students who are from poor/ term of 12 months. The interest is calculated by using a low/medium income families and have good academic declining balance. Clients can pay interest monthly and performance and a strong commitment in pursuing principal at the end of loan term. higher, professional or technical education that need financial support for accomplishing their dream Community Bank Loan (VSU Loan) academic or vocational skills to increase their income It is a micro loan that does not require physical collateral, and to improve the future living standard. This loan is but a joint liability group of 4-6 persons formed to act as for all skill development including vocational training, a community bank. It aims at serving the poor, poorest professional academic, Higher Education Program. Our and vulnerable in the rural community who will use the loan size is from USD 200 to USD 6,000 (Only USD loan for upgrading the economics of their household. currency), loan term from 06 months to 84 months with This loan product is being implemented through allow grace period to pay principal up to 84 months, a special project of KREDIT called the Vulnerable and interest rate ranging from 1.6% - 1.3%. Services Unit (VSU).
Getting more success with loan from KREDIT. 28 29 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Our Products and Services (Continued) Our Products and Services (Continued)
Savings Products We have two types of Term Deposit a) Wealthy Return: Local Money Transfer convenient and more innovative products and services KREDIT is currently providing a variety of savings with it, the depositor can withdraw the interest every Local Money Transfer is another service that KREDIT as their preference. To see satisfactory levels on products to customers: savings account, term deposit month and the principal at the maturity date, b) is providing. With this new service, KREDIT can allow our products and services as well as their potential account, and partnership savings account. KREDIT Wealthy Growth, the interest and principal can be clients to repay loans to KREDIT at any of our offices in preference, in early 2014, KREDIT also conducted ensures the liquidity safety and convenience for the transacted at the maturity date. The term can be 1 our operational areas. This service is with an affordable client’s satisfaction survey with 607 clients who fee, fast and secure. Till now, we have found that our have been with KREDIT at least for 13 months from depositors and charges no account keeping fees. month, 3 months, 6 months, 9 months, 12 months, 18 clients enjoyed much with this service. 12 offices in 8 provinces using the random method. We Interest on deposits is daily calculated and at the months, 24 months, and 36 months. The yearly highest also conducted clients’ exit survey with 217 voluntarily highest rate in the market. interest rate is 12% for saving in local currency (KHR) Starting with only $1, you can send money nationwide exited clients from 7 offices. and 8.5% for USD currency. with KREDIT. Savings Account Below are some findings from the survey: Savings account targets both KREDIT’s staff and the Partnership Savings Account Currency Exchange - 99% of ID clients and 96% of VSU clients satisfied With the MDI license, we are yet to have authorities to public who wishes to keep their money in a secure KREDIT provides affordably professional services to with loan sizes providing by KREDIT; provide currency exchange to the public but we can do and accessible place and allows them to withdraw at partner organizations by streamlining savings and - 97% of clients satisfied with our current repayment with our existing clients. However, it also helps ourclients any time. With this type of saving, clients can open an credit facilities through the NGO’s normal administration modes; to solve exchange problem that usually requires them account with a minimum balance of only KHR20,000 operations. Partnership Savings targets companies - 95% of VSU and 92% of ID clients satisfied with loan to go to the market, make currency exchange and come term; or USD5 with 4.5% interest rate per annum on KHR or institutions that want to save for staff in their own to KREDIT's office for loan repayment. - Compared with the last exit survey study in Feb currency and 3.5% interest per annum for USD personal saving account, and/or for future expenses 2013, reasons of exit related to KREDIT’s policy was currency. The interest is compounded monthly. No and investment. Only USD5 is needed as a minimum To serve the market movement and the capacity of down from 33% to 27% while issues of group loan is account keeping fee is charged. deposit to open a partnership savings account with new core banking system (Oracle Flexcube), KREDIT still similar. The main reasons of exit are personal and 5% per annum interest rate on saving being provided has also studied and developed some new financial occupations which are external factors. Balance Annual Interest to clients. The interest is calculated daily on the services and planned to introduce in the near future. We Term hope that the product modifications and development Minimum Maximum KHR USD outstanding balance and added to the principal at the With the findings, we can see that our current loan KHR20,000 KHR100,000,000 will help provide our clients with more convenience and Everyday 4.5% 3.5% conditions are mostly satisfied by the clients; however, $5 $50,000 end of each month. choices. we also found a few points needed to be improved.
Balance Annual Interest With the findings, the management has taken actions Term Deposit Account Term Market Study for Modifications and Minimum Maximum USD to enhance them and hopefully we can serve our clients Term Deposit Account is a contracted saving with a Development 3% of much better. certain amount of money, terms, and interest rate Everyday $5 KREDIT’s Net 5% KREDIT is really careful with products and services Worth provision to the clients. We want to provide them agreed upon between KREDIT and the clients.
Start saving with us now...! Starting with only $1, you can send money nationwide with KREDIT. 30 31 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Operational Performance Operational Performance (Continued)
Despite good economic growth of the country for the from staff and also findings from the research help the Notes: - Mortgage loan includes real estate loan, loan for year of about 7.2%, KREDIT has carefully expanded management in decision making for any adjustments After the implementation of Cambodia Credit Bureau buying land and house; by keeping focus on quality of work while maintaining to the products and services. With good coordination (CBC), KREDIT decided classifying loan purposes as - Agriculture loan covers loan for cropping and animal good services provision to the clients within the and commitment of management and staff at all levels, below to fit to CBC: husbandry operations areas. To enhance the quality of the service KREDIT has continued its growth with quality for year - Social loan includes latrine loan, community bank provided to the clients; as normal, KREDIT in 2013 also 2013. loan, trust bank loan, emergency loan, and water filter Disbursement of the Loan for the Year arranged a workshop so called “management level 2 loan; In 2013, KREDIT disbursed loan totaling $ 91,890,128.71 workshop” at where all branch managers, sub branch Operational Area and Office Outreach - Consumption loan covers complete house loan, to 76,337 clients. It is increased $ 25,098,694 (27.31%) managers, and other branch management staff come At the end of the year 2013, KREDIT operates loan for buying motor for renting to KREDIT by staff, and 12,673 (16.60%), in term of loan and clients to join with presences of all Ex Com members. During through 60 branch / sub-branch offices and 6 unit agr- assets acquisition loan, and other consumption- compared to 2012. The most percentage disbursed to the workshop, we discussed and we did reflection what offices, in 15 provinces, 110 districts, 857 communes purpose loan; client are social loan 35.53%, agriculture loan 25.45%, we are doing in different offices, challenges and issues, and 5,402 villages. The increase of numbers of offices - Business loan covers production loan, trade and consumer loan 18.28%, and business loan 17.52%. and comments from the field levels. Responsible and coverage area is really beneficial to clients as the commerce, and services; departments and units who also attended the workshop services are closer to their hands so that they can easily clarified points raised by the participants. Comments access when needed. Amount Disbursement by Loan Purposes
Descriptions 2010 2011 2012 2013 Education Loan 0.01% Branches 9 10 12 13 Mortgage 6.28%
Sub Branches 38 44 51 60 Social Loan 7.67% Unit Offices 2 4 5 6 Provinces 10 11 13 15
Districts 75 90 101 110 Business Loan 35.93%
Communes 656 661 745 857 Consumer Loan Villages 3,986 4,216 4,631 5,402 23.67%
Loan Portfolio Compared to 2012, the portfolio outstanding and clients have grown to 39% and 20% respectively reaching $ Agriculture 26.45% 74.20 million and 73,115 clients from $ 53.49 million and 60,905 clients. The most percentage sectors of loan utilization are business loan 37.19%, agriculture loan 25.52%, and consumer loan 22.76%.
Loan Outstanding by Purposes
Education Loan 0.01% Mortgage 6.25%
Social Loan 8.27%
Business Loan 37.19%
Consumer Loan 22.76%
Agriculture 25.52%
Borrowers by Purposes
Education Loan 0.01% Mortgage 3.40%
Business Loan 20.05%
Social Loan 33.84%
Agriculture 23.61%
Consumer Loan 19.09%
32 33 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Operational Performance (Continued) Operational Performance (Continued)
Loan Quality Structure Staff Productivity and Workload The portfolio at risk (Par 30+) ratio as of Dec 2013 was 0.28% which is a bit higher compared to 2012, 0.26%. The average number of borrowing accounts per credit officer/loan and saving officer (CO/LSO) was increased However, the percentage of write-off loan was decreased from 0.15% in 2012 to 0.10% in 2013. from 171 clients to 175 clients, per front line was increased from 114 clients to 116 clients; however, average number of borrowing accounts per total staff was decreased from 76 clients to 71 clients. The reason for the decrease of productivity ratio to total staff is because numbers of our support staff have been increased; mainly at IT department which is currently so busy with the new core banking system.
For average loan outstanding per CO or LSO, per front line, and to total staff were all increased.
Productivity 2010 2011 2012 2013 Loans/CO&LSO (in USD) 125,502 143,382 152,851 184,123 Borrowers/CO&LSO 194 186 171 175 Loans/Front line staff (in USD) 100,172 113,465 101,513.83 121,443 Borrowers/Front line staff 155 147 114 116 Loan/Total staff (in USD) 55,898 62,192 63,087.02 74,649 Borrowers/Total staff 86 79 76 71
Deposit With different activities employed for this new service, we have found that saving performance of KREDIT for the year 2013 is also good. At the end of 2013, KREDIT has 9,023 depositing accounts with deposit amount of USD16, 217,004. To ensure bigger growth for next year, KREDIT also held special workshops with all related staff from all saving-collection offices to identify some challenges so that we can address. We are looking forwards to hug growth for the year 2014 as we planned to do many different activities after the workshops.
34 35 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Social Performance Management and KREDIT Social Performance Management and KREDIT (Continued)
Our Progress with SPM and local authorities to ensure that they offer products smart ways to select financial partners when needed. As swap the books among the group after their reading so No too long after having clear social performance that are truly wanted in the communities. of Dec 2013, a total of 20,404 clients already received that they can get more knowledge from it. This training and community development unit; in 2013, KREDIT such necessary training from our staff. Besides the is also provided to normal villagers, staff of our partners successfully established the social performance KREDIT categorized the social performance programs/ clients, KREDIT also provides this training to normal and our own staff by a special group of staff who are committee at BoD level with clear charter. The committee projects in to 2: permanent and need- based programs / villagers and staff of our partners. KREDIT with support specialized in this field. Education loan is also another set up a Term of Reference (TOR), so-called “Social projects: from our partners planned to update the financial training new product already tested for a year. Even though Performance and Community Development Fund” to give tools making sure that it is easier understood by clients the performance of this loan for the year is still low, but clear nature of the social fund, to set out some criteria for Permanent Programs and more beneficial for them. Early 2014, KREDIT was we have learnt much more from this new product and eligible projects or activities to be supported, and also KREDIT will sharpen these programs from one time to selected by National Bank of Cambodia and CMA to we have identified points for improvements. We hope to provide general process to use the fund. 5%- 10% of another so that in the future KREDIT will become a main produce a documentary about financial training to clients to get higher performance for upcoming years. Along yearly net profit from the company is also flew in to this player to these selected issues. for Global Money Week, arranged by Child and Youth with our activities at the field with clients, KREDIT is account after the audit report issued and BoD approved. Here are permanent programs of KREDIT: Finance International. also a member of Cambodia child welfare group ▪ Vulnerable Services Unit (VSU) ▪ Agriculture Training which is formed by organizations working with children Within the year 2013, the environmental and social policy A special program which is specially designed to address Special agriculture training is designed to equip rural affair in Cambodia. We have a monthly meeting to talk had been also presented to the BoD and got approval. the need of rural poor household by providing them poorest and poor clients with their most preferred about child issues and also we have a weekly program The partnership with our development NGOs, school, with finance and non- financial services. Some of non- agriculture skill. The training is very special because on Friday, 5:30-6:30pm on a radio in which experts in and vocational training have been smoothly expanded financial services provided by KREDIT and some by our the group members discuss and select a topic children are invited as speakers. allowing our clients can get many more benefits from our partners. This is to ensure that the service providers that they mostly like to learn while trainers are experts ▪ Contribution to Reduction of Traffic Accident services. are expertise by their own field. The VSU operations from KREDIT's development partners. The training KREDIT has continued getting even more involvement have been expanded to cover many more coverage conducted on both ways: theory and on-hand practice in this intervention. Radio program to build awareness Training on social performance management (SPM) and areas. The financial service is still special in terms with demonstration farm and usually it takes 2 days of people about traffic law still continued and many more client protection principles (CCP) has also been provided of: lower interest rate, without collateral and village- at their villages. During the on-hand training, all helmets produced and given to staff. More programs to some of staff within the year 2013 and will be provided based service. Non-financial services have also been members are getting involved in all activities on the planned to work out more with Cambodian Red Cross more in 2014. From the training, staff can understand continued and described in next points. In addition field so they can not only hear from trainer, but they can includes workshop with high schools and universities to the concept of SPM, its benefits to KREDIT, to staff, when clients in this project died, their family no need to see and they practice themselves. In addition, follow up build awareness about traffic law, banner at each traffic to clients, etc. The staff will also understand what are repay the balanced loan and they will also get a package program is also arranged to give trainers and trainees light, and other promotional leaflets. activities or programs that KREDIT will do and what are of money to arrange the funeral ceremony from KREDIT. an opportunity to talk about their experiences when ▪ Contribution to Improvement of Hygiene and their contributions and involvement in the activities and As of Dec 2013, VSU project is handing 23,395 (32% of putting theories in to their own practice. As of the same Since late 2012, KREDIT has partnered with some programs. total KREDIT borrowers) poor and poorest families with date, 4,533 families of clients already received such development partners to lend small loans to poor rural loan outstanding USD 5.53 mil in 174 communes of 41 training from our expert NGO partners. families to buy a simple set of latrine and water filter for Within the year, KREDIT has also continued working districts. ▪ Child Education Training their daily uses. As of Dec 2013, 1,012 families bought with CMA and Agency France Development (AFD) on an ▪ Finance-Related Training To promote child education and development, KREDIT latrines and 33 bought water filter from our promotion assessment about the current implementation of client Financial-related training is specially designed and and its partners developed child education training to be in which some got loans from KREDIT and some used protection principles (CPP) in KREDIT. Now, the report provided directly by KREDIT's staff to poor clients with provided to our staff and poor clients so that they can their own saving. This intervention aims at contribution to form the assessment issued, points to be improved an aim at increasing their knowledge and good practice provide better education and better care to their children hygiene and sanitation improvement at rural community. have been identified, and actions plan set with clear on family financial management. The training topics which is a basic need and the right of all children. responsible departments and units and deadline. As include saving, budgeting, and debt management. We want to see perceptions of poorest and poor Need-based program planned, 2014 will be the year that most gaps in CPP The training is provided directly by our credit officers/ clients changed by investing more resources towards Besides permanent program, KREDIT also has another be filled. loan and saving officers. education and welfare of their children instead of program called “Need- Based Program” to respond From an assessment conducted by external consultant, sending them to work field. The training topics include to the real needs of the clients and communities we Our Social Performance Programs/ Projects it revealed a majority of clients that attended the training good parents, needs of children, building a happy family, are working with. Under this programs, we have done KREDIT addresses the real needs of their targeted were highly appreciative of the sessions. Training child protection, child abuse, and child labor. 8,751 some activities: supporting pump well, canal renovation, clients. This means that before starting a project/ communicates to clients the importance of savings, ways clients have received this good training along with kindergarten building, etc. We will study other real needs program, KREDIT conducts assessments based on the to increase their daily income, decrease unnecessary educational reading books containing different topics of people in different areas by working with the local needs of the clients, working closely with staff, villagers expenses, cash flow projection and management, also without return. However, the clients are also advised to commune council using community development plan. 36 37 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Social Performance Management and KREDIT (Continued) Our Lenders, Partners, and Network
Our Lenders to MFIs by Cambodian commercial banks have been Despite positive trend of saving mobilization in the continued and expanded. country, the main funding sources of MFIs in Cambodia are still from loans lent by oversea lenders. However, Despite no official data about lending by international Special thanks to KREDIT’s shareholders for their commitment to help we have observed that the saving collection trend will lenders to Cambodian MFIs but KREDIT has continued be continuing its positive path and will become very getting much more supports from our lenders. More Cambodia rural community by allocating good local fund for Cambodian MFIs in the near future loans with bigger amounts and better deals have been or we can say that the Cambodian MFIs will cut down continued lending to KREDIT. Below are names of dependency on outside fund from year to year. Lending KREDIT’s current lenders:
5-10% of their yearly net profits LENDER NAMES 1 Developing World Market 18 MicroFinance Enhancement Facility
for social programs and activities in this country ! 2 Conzorio Etimos 19 responsibility Global Microfinance Fund 3 Etimos Fund 20 responsAbility SICAV (LUX) Mikrofinanz-Fonds
4 Calvert Foundation 21 responsAbility SICAV (LUX) Microfinance Leaders
responsAbility SICAV (Lux) Financial Inclusion 5 Triple Jump 22 Fund
6 MicroCredit Enterprise 23 Oikocredit
7 BlueOrchard MicroFinance Fund 24 World Hope International
8 Microfinance Initiative Fund for Asia 25 ICO (Spain)
9 GoodDeed Company 26 Partner For Development
10 Wallburge Invest S.A 27 VDK Spaarbank
11 Finethic Microfinance S.C.A.,SICAV-SIF 28 Impulse
12 IC Fund SICAV 29 BANK IM BISTUM ESSEN e.G
13 Dual Return Fund S.I.C.A.V 30 Commerzbank A.G
14 GoodDeed Company 31 HwangDBS
15 Symbiotic SICAV 32 Maruhan
16 responsAbility SICAV (LUX) 33 ACLEDA Bank
17 Credit Suisse Microfinance Fund Management 34 Kiva
38 39 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Our Lenders, Partners, and Network (Continued) Listen to Our Staff, Partners, and Clients Talking about KREDIT
Clients Partners development players to equip our poor and the poorest KREDIT believes that our financial service alone is not clients with other complimentary services. We are enough to move our poor and poorest clients from the together to provide many different services needed by CHUON CHEAR, 40, and her husband CHHOEM CHHOEU, 45, are poverty because they usually need many more basic our clients based on specializations of each individual farmers, growing cassava and corn. They are living with their two supports from many different interventions. Having organization. children in Battambang Province. Describing her future goals, Chuon seen this, KREDIT has worked with many different Chear says “in the future I want my children to study in the University and get a good job, while I have nothing to pass on to them I want them to be knowledgeable.”
SIE CHANLY, 33 years old, is a resident of Ratanak Modul district, Battambang province, where she lives with her husband, NHOEM NOU, and her son. “Before the loan from KREDIT, my family’s life was terrible because I only work at a corn and soybean farm for a daily wage. Now we own land for growing cassava and corn”, she says. “I thank KREDIT for the loan and the many training courses in finance, agriculture and child education that changed my family’s life. Now I believe that my son will go for a higher education and my husband and I will help him to achieve his dream.”
CHOEM MOUN, 54, lives with his wife SOEUN SEAR, 50, and four Networking Partners children in Kilomet village, Battambang province north of Phnom Penh. - A member of Cambodian Microfinance Association, - A permanent and active member of Cambodia Child Warfare Group He is a farmer who loves to take care of his crop and is eager to - A member of Social Performance Task Force develop his business. When KREDIT came to the village he saw his - The oldest active partner of Kiva in their partner’s list chance of starting a business from having nothing and he made a plan - A members of Banking With The Poor (BWTP) for the future. “People in the village take the loan without a plan and - A member of Mix Market that is why they are still poor, Choem Moun says, I always had a plan - A partner of AFD and CMA project to enhance Client Protection Principles for my family”. In the future he wants to expand his chicken farm and - A partner of “road traffic program” of Cambodia Red Cross, the only one Cambodian MFI to be invitedto continue to do what he loves the most so the children can in heritage endorse with joint statement “Motorcycle passengers, including children, must wear helmets” issued by Asia Injury his business and take care of it. Prevention Foundation, Coalition for Road Safety, and Handicap International - One of 6 Cambodian MFIs got support from PlaNet Finance on FinIncAsia and 2 of staff were certified as SPM trainers and mentors from the project - An institution who endorsed with Smart Campaign on client protection principle - An institution who got certification from Transparent Pricing Initiative by MFTransparency Organization - An institution who got 2 times of Merit Award from CGAP on Finance Transparency;
40 41 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
Listen to Our Staff, Partners, and Clients Talking about KREDIT (Continued) Awards Received Within 2013
Village Leader
With a smiling face, Mr. CHEA PECH, village leader of Bos Ty, Kok Commune, Ponhea Krek District, Thbaung Khmum commune, expressed his delight in attending the parenting training conducted by “MOST INNOVATIVE NON - PROFIT SOCIAL KREDIT. He believes the villagers who came for the training got more ENTERPRISE” from Singapore Venture Capital and knowledge and they will practice it in the future. As a leader, he will Private Equity Association (SVCA) 21st Anniversary continue to share such good knowledge to those who did not attend by Gala & Awards Dinner for the year 2013. talking to young mothers whenever he gets the chance. 1
Village Bank Leader
Mrs. En Yei who declared that she has five grandchildren showed great appreciation towards KREDIT for providing the training to the families in her village. She was very interested in the role of parents also being teachers and she practices this herself. She said, “everyday Seal of Pricing Transparency 2013 I share the knowledge gained from parenting training to other villagers and I always bring with me the materials provided by KREDIT to show This is a widely recognized guarantee of our efforts to abide by the best international practices. The them.” award was given to KREDIT by Transparent Pricing Initiative in Cambodia and it certifies that KREDIT is 2 transparent in its product pricing.
Message from Board Chairman and Shareholder Representative
On behalf of KREDIT's shareholders, Phillip Capital and World Relief, we wish to thank the CEO, management and staff for the hard work that you have all put in to produce such good results for 2013. I am sure all our customers are blessed 2 awards from KIVA for: by the loans that we have extended to them and we must all be very pleased Facilitation of Savings and Client Voice to have made a difference in their lives. Once again thank you and we shall all continue to put forth our best efforts together and be an even greater blessings to Visit: www.kiva.org/partners our borrowers in the years to come. 3
42 43 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report External Audit Report (Continued)
DIRECTORS’ REPORT BAD AND DOUBTFUL LOANS
The Board of Directors (“the Directors”) hereby submits its report together with the audited financial statements Before the financial statements of the Company were drawn up, the Directors took reasonable steps to ascertain of KREDIT Microfinance Institution Plc., formerly known as CREDIT Limited (“the Company”) for the year ended that actions had been taken in relation to the writing off of bad loans and the making of allowance for bad 31 December 2013. and doubtful loans, and satisfied themselves that all known bad loans had been written off and that adequate allowance had been made for bad and doubtful loans. PRINCIPAL ACTIVITY At the date of this report, the Directors are not aware of any circumstances that would render the amount written off The principal activity of the Company is to provide credit to local customers through its head office in Phnom Penh for bad loans or the amount of allowance for doubtful loans in the financial statements of the Company inadequate and its various provincial and district offices in the Kingdom of Cambodia. to any material extent.
On 29 December 2010, the Company received a licence from the National Bank of Cambodia (“the Central Bank”) ASSETS to conduct a deposit-taking business. Before the financial statements of the Company were drawn up, the Directors took reasonable steps to ensure FINANCIAL PERFORMANCE AND DIVIDENDS that any assets that were unlikely to be realised in the ordinary course of business at their values as shown in the accounting records of the Company have been written down to an amount which they might be expected to The financial performance for the year ended 31 December 2013 is set out in the income statement on page 8. realise.
On 3 May 2013, dividends amounting to US$409,338 were declared and paid in respect of the Company’s profit At the date of this report, the Directors are not aware of any circumstances that would render the values attributed for the year ended 31 December 2012 (2012: US$334,915). to the assets in the financial statements of the Company misleading in any material respect.
SHARE CAPITALS VALUATION METHODS
On 19 September, 2012, the Central Bank approved the increase of the authorised and registered share capital At the date of this report, the Directors are not aware of any circumstances that have arisen that would render by Riel 4,410 million (approximately US$ 1,102,500). adherence to the existing method of valuation of assets and liabilities in the financial statements of the Company misleading or inappropriate in any material respect. The revised share structure was registered in the Ministry of Commerce on 21 May 2013. CONTINGENT AND OTHER LIABILITIES The details of authorised and registered shareholding are as follows: At the date of this report, there is: 2012 2013 % of Number of Amount % of Number of Amount (a) no charge on the assets of the Company that has arisen since the end of the year that secures the ownership shares US$ ownership shares US$ liabilities of any other person; and Phillip MFI Pte Ltd 67.43 67,034 3,351,700 58.15 44,984 2,249,200 (b) no contingent liability in respect of the Company that has arisen since the end of the year other than in the ordinary course of business. World Relief Corporation 32.57 32,380 1,619,000 41.85 32,380 1,619,000
100 99,414 4,970,700 100 77,364 3,868,200 No contingent or other liability of the Company has become enforceable, or is likely to become enforceable within the period of 12 months after the end of the year that, in the opinion of the Directors, will or may have a material effect on the ability of the Company to meet its obligations as and when they become due.
CHANGE OF CIRCUMSTANCES
At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in this report or the financial statements of the Company that would render any amount stated in the financial statements misleading in any material respect. 44 45 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
ITEMS OF AN UNUSUAL NATURE The Directors confirm that the Company has complied with the above requirements in preparing the financial statements. There were no items, transactions or events of a material and unusual nature that, in the opinion of the Directors, materially affected the financial performance of the Company for the year ended 31 December 2013. APPROVAL OF THE FINANCIAL STATEMENTS There has not arisen in the interval between the end of the year and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors, to affect substantially the results of The accompanying financial statements, together with the notes thereto, present fairly, in all material respects, the operations of the Company for the current year. the financial position of the Company as at 31 December 2013 and its financial performance and cash flows for the year then ended in accordance with the guidelines issued by the National Bank of Cambodia and Cambodian THE BOARD OF DIRECTORS Accounting Standards, were approved by the Board of Directors.
The members of the Board of Directors during the year and as at the date of this report are: On behalf of the Board of Directors. • Mr. Timothy Mark Amstutz, Chairman • Mr. Daniel John Brose; Member (appointed on 25 January 2012) • Mr. Ong Teong Hoon, Member • Mr. Tan Teck Keong Michael, Member • Ms. Srey Hem Roberts, Member • Ms. Ing Varony, Member • Ms. Tea Chansotheary, Member • Mr. Fong Kum Choy, Member
RESPONSIBILITIES OF THE BOARD OF DIRECTORS IN RESPECT OF THE FINANCIAL STATEMENTS
The Directors are responsible for ensuring that the financial statements are properly drawn up so as to present fairly, in all material respects, the financial position of the Company as at 31 December 2013 and its financial performance and cash flows for the year then ended. In preparing these financial statements, the Directors are required to:
i) adopt appropriate accounting policies that are supported by reasonable and prudent judgements and estimates, and then apply them consistently;
ii) comply with the disclosure requirements and the guidelines issued by the National Bank of Cambodia and Cambodian Accounting Standards or, if there has been any departure from such standards in the interest of fair presentation, ensure that this has been appropriately disclosed, explained and quantified in the financial statements;
iii) maintain adequate accounting records and an effective system of internal controls;
iv) prepare the financial statements on a going-concern basis unless it is inappropriate to assume thatthe Company will continue operations in the foreseeable future; and
v) effectively control and direct the Company and be involved in all material decisions affecting its operations and performance and ascertain that such matters have been properly reflected in the financial statements.
46 47 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
Independent auditor’s report
To the Shareholders of KREDIT Microfinance Institution Plc.
We have audited the accompanying financial statements of KREDIT Micorfinance Institution Plc. (the Company), which comprise the balance sheet as at 31 December 2013, and the income statement, the statement of changes in equity and the cash flow statement for the year ended, and notes, comprising a summary of significant accounting policies and other explanatory information.
Management’s responsibilities for the financial statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with the Cambodian Accounting Standards and guidelines of the National Bank of Cambodia, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Cambodian International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgement, including assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as at 31 December 2013, and its financial performance and its cash flows for the year ended in accordance with the Cambodian Accounting Standards and the guidelines of the National Bank of Cambodia.
48 49 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
50 51 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
APPENDIX: NOTES ON COMPLIANCE WITH THE CENTRAL BANK’S PRAKAS
52 53 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
APPENDIX: NOTES ON COMPLIANCE WITH THE CENTRAL BANK’S PRAKAS LOAN CLASSIFICATION, PROVISIONING, AND DELINQUENCY RATIO, Prakas No. B7-02-186 FOR THE YEAR ENDED 31 DECEMBER 2013 Licensed microfinance institutions shall classify their loan portfolios into the following four classes, depending on the financial situation of the borrower and the timeliness of principal and interest payments.
Loan term of one year or less than one year
SOLVENCY RATIO, Prakas No. B7-07-163 • Standard: good financial condition and punctual payment of principal and interest • Sub-standard: some payments of principal and/or interest are overdue by 30 days or more A licensed deposit-taking microfinance institution shall at all times maintain a solvency ratio of more than 15%. As • Doubtful: some payments of principal and/or interest are overdue by 60 days or more at 31 December 2013, the solvency ratio of the Company was 20.96%. • Loss: some payments of principal and/or interest are overdue by 90 days or more
The net worth and solvency ratio calculation are detailed in Schedule 1. Loan term of more than one year
• Standard: good financial condition and punctual payment of principal and interest 2. LIQUIDITY RATIO, Prakas No. B7-07-163 • Sub-standard: some payments of principal and/or interest are overdue by 30 days or more • Doubtful: some payments of principal and/or interest are overdue by 180 days or more A licensed deposit-taking microfinance institution shall at all times maintain a liquidity ratio of at least 50%. As at • Loss: some payments of principal and/or interest are overdue by 360 days or more 31 December 2013, the liquidity ratio of the Company was 268.68%. Mandatory provisions on the loans are classified as follows: The liquidity ratio calculation is detailed in Schedule 2. • Sub-standard: 10% regardless of the collateral value except cash • Doubtful: 30% regardless of the collateral value except cash 3. NET OPEN POSITION IN FOREIGN CURRENCY, Prakas No. B7-07-134 • Loss: 100%
A licensed microfinance institution shall at all times maintain a net open position in foreign currencies in either any As at 31 December 2013, the provision provided by the Company was KHR 829,290 which is in compliance with foreign currency or an overall net open position in all foreign currencies, whether long or short, which shall not the Central Bank’s Prakas. exceed 20% of the Company’s net worth. As at 31 December 2013, the net open position in Khmer Riel was short 7.84% and in Euro was long 0.24%. Loan classification, provision and delinquency ratio calculation are detailed in Schedule 5.
The net open position calculation is detailed in Schedule 3.
4. RESERVE REQUIREMENT, Prakas No. B7-07-163
A licensed deposit-taking microfinance institution shall deposit 8% of its deposits into an account maintained with the Central Bank. On 29 December 2010, the Company received a licence from the Central Bank to conduct a deposit-taking business. As at 31 December 2013, the Company’s reserve requirement was KHR 64,786,931 which is greater by KHR 59,603,977 than the Central Bank’s requirement.
The reserve requirement calculation is detailed in Schedule 4.
54 55 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
SCHEDULE 1 KHR ‘000 NET WORTH AND SOLVENCY RATIO AS AT 31 DECEMBER 2013
I- Numerator (A) KHR ‘000
I- Sub-total A: Items to be added Net worth 66,661,381 - Capital or endowment 19,857,947 - Reserve, other than revaluation reserves 3,741,565 II- Denominator (B) - Premium related to capital (share premium) 5,583,013 Assets * KHR ‘000 Weighting - Provision for general banking risks, with the prior agreement of the - Central Bank - Cash 12,739,136 0% - - Retained earnings 18,862,220 - Gold - 0% - - Audited net profit for the latest financial year 6,212,621 - Claims on the Central Bank 17,900,732 0% - - Other items approved by the Central Bank - - Assets collateralised by deposits - 0% - - Claims on sovereigns rated AAA to AA- - 0% - 54,257,366 - Claims on sovereigns rated A+ to A- - 20% - - Claims on banks rated AAA to AA- - 20% - II- Sub-total B: Items to be deducted - Claims on sovereigns rated BBB to BBB- - 50% - - For shareholders, directors, managers and their next of kin 359,614 - Claims on or guaranteed by banks or corporation 232,580 50% 116,290 > Unpaid portion of capital - - All other assets 317,857,358 100% 317,857,358 > Advances, loans, security and the agreement of the persons - concerned as defined above 348,729,806 317,973,648 - Holding of own shares at their book value - - Accumulated losses - III- Solvency ratio (A/B) 20.96% - Formation expenses - - Losses determined on dates other than the end of the annual * The denominator of the ratio shall comprise the aggregate of the assets (net amount after deduction of provision accounting period (including provisions to be made for doubtful debt and and depreciation) and off-balance sheet items, weighted to their degree of risk. It excludes the items that are securities) - deducted in calculating the net worth according to the provisions of the Prakas on the calculation of microfinance institutions’ net worth. 359,614
III- Total C: BASE NET WORTH = A – B 53,897,752
IV- Sub-total D: Items to be added - Revaluation reserves, with the prior agreement of the Central Bank - - Subordinated debt, with the prior agreement of the Central Bank, up to 7,990,000 100% of base net worth - Other items, with the prior agreement of the Central Bank, could be included in the calculation of net worth and shall not be more than the base net worth 4,773,629
12,763,629
V- Sub-total E: Items to be deducted - Equity participation in banking and financial institutions - - Other items -
-
VI- Total F: TOTAL NET WORTH = C + D - E 66,661,381
56 57 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) External Audit Report (Continued)
SCHEDULE 2 SCHEDULE 3 LIQUIDITY RATIO AS AT 31 DECEMBER 2013 NET OPEN POSITION IN FOREIGN CURRENCY AS AT 31 DECEMBER 2013
KHR ‘000 Liabilities Net open NOP/ Currency Assets and capital position (NOP) Net worth Limit 1- Numerator: Liquid assets KHR ‘000 KHR ‘000 KHR ‘000 % %
- Cash on hand 12,739,135 US$ 278,560,017 (273,495,495) 5,064,522 7.60% 20% - Balances with the Central Bank 10,877,126 KHR 70,366,387 (75,593,925) (5,227,538) (7.84%) 20% - Balances with banks 9,380,480 EUR 163,016 - 163,016 0.24% 20%
Sub-Total (A) 32,996,741 Total 349,089,420 (349,089,420) - -%
Less: Net worth 66,661,381 - Amount owed to the Central Bank - - Amount owed to banks 2,663,562
SCHEDULE 4 Sub-total (B) 2,663,562 RESERVE REQUIRMENT AS AT 31 DECEMBER 2013
Net liquidity (A – B) 30,333,179
Plus: KHR ‘000
- Portion of loans outstanding maturing in less than one month 13,183,684 1- Voluntary 1-1 Demand - Liquid assets (L) 43,516,863 1-2 Savings (3.5%-6% per annum) 11,859,205 1-3 Term 52,927,726 2- Denominator: Adjusted amount of deposits (A) 1-4 Other - Category of deposits KHR ‘000 % 1-5 Total reservable deposits 64,786,931 - Voluntary savings 64,786,931 25% 16,196,733 2- Compulsory 2-1 Program (3% per annum) - LIQUIDITY RATIO (L/A) 268.68% 2-2 Program - 2-3 Program -
2-4 Total compulsory savings -
3- Total savings mobilised 64,786,931
8% Reservable deposits 5,182,954
58 59 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
External Audit Report (Continued) Contact Us
SCHEDULE 5 LOAN CLASSIFICATION, PROVISIONING, AND DELINQUENCY RATIO HEAD OFFICE AS AT 31 DECEMBER 2013 Building Nº 71, St. 163, Sangkat Toul Svay Prey I, Khan Chamkarmorn, Phnom Penh, Cambodia. Phone: (855) 23 217 942 / (855) 89 989 818, Fax: (855) 23 217 942, E-mail: [email protected] Mandatory 1. PHNOM PENH BRANCH Amount Rate Provision 1.1 Phnom Penh Branch and Sub Branch Office Loan classification KHR ‘000 % KHR ‘000 Building Nº 71, St. 163, Sangkat Toul Svay Prey I, Khan Chamkarmorn, Phnom Penh. Phone: (855) 23 638 0003 1-Loans of one year or less 1-1 Standard 52,467,198 0% - 1.2 Meanchey Sub Branch Office
1-2 Substandard past due ≥ 30 days 21,529 10% 2,153 House Nº 694, St. 271, Group 41, Village 7, Sangkat Phsar Doeum Thkov, Khan Chamkarmorn, 1-3 Doubtful past due ≥ 60 days 11,805 30% 3,544 Phnom Penh. Phone: (855) 23 638 0004
1-4 Loss past due ≥ 90 days 31,812 100% 31,812 1.3 Porthi Sencheuy Sub Branch Office Sub-total 1 52,532,344 37,509 House Nº 113, Russian Blvd., Porprok Tbaung Village, Sangkat Ka Kab, Khan Porthi Sencheuy, Phnom Penh. Phone: (855) 23 638 0005 2-Loans of more than one year 1.4 Toul Kork Sub Branch Office 2-1 Standard 242,054,585 0% - Nº 115 AI, St. 273, Group 2, Toul Kok Village, Sangkat Toul Sangke, Khan Russei Keo, 2-2 Substandard past due ≥ 30 days 394,067 10% 39,402 Phnom Penh. Phone: (855) 23 638 0007 2-3 Doubtful past due ≥ 180 days 229,093 30% 68,730 1.5 Stueng Meanchey Sub Branch Office 2-4 Loss past due ≥ 360 days 140,984 100% 140,984
Sub-total 2 242,818,729 249,116 House Nº 8A, Monireth Blvd., Trea 3 Village, Sangkat Stueng Meanchey, Khan Meanchey, Phnom Penh. Phone: (855) 23 650 5752
Grand total 1+2 * 295,351,073 286,625 2. KANDAL BRANCH
2.1 Kandal Branch and Takmao Sub Branch Office All loans past due > 30 days (A) 829,290 House Nº 14, National Road Nº 2, Ta Kdol Village, Sangkat Ta Kdol, Krong Takmao, Kandal Province. Phone: (855) 24 638 0001 Loans outstanding (B) * 295,351,073 2.2 Sa Ang Sub Branch Office
House Nº 322, National Road Nº 21, Prek Ron Village, Prek Kouy Commune, Sa Ang District, Delinquency ratio (A/B) 0.28% Kandal Province. Phone: (855) 24 638 0002
* Gross loans to customers without taking into consideration the offsetting of loans prepayments. 2.3 Koh Thum Sub Branch Office
House Nº 65, National Road Nº 21, Kampong Svay Krom Village, Prek Thmey Commune, Koh Thom District, Kandal Province. Phone: (855) 24 638 0005
2.4 Kong Pisei Sub Branch Office
For full external audit report, please visit: www.kredit.com.kh National Road Nº 3, Tram Kna Village, Snom Kraper Commune, Kong Pisei District, Kampong Speu Province. Phone: (855) 25 638 0004
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3. TAKEO BRANCH 4.6 Bos Knaor Sub Branch Office
3.1 Takeo Branch and Daun Keo Sub Branch Office National Road Nº71, 10 Makara Village, Bos Knaor Commune, Chamkar Leu District, Kampong Cham Province. Phone: (855) 12 597 395 Phsar Takor Village, Sangkat Rokaknoung, Krong Doun Keo, Takeo Province. 4.7 Baray Sub Branch Office Phone: (855) 32 638 0001 National Road Nº 6, Sala Khum Village, Triel Commune, Baray District, Kampong Thom Province. 3.2 Bati Sub Branch Office Phone: (855) 93 555 314
National Road Nº 2, Chork Village, Trapeang Sap Commune, Bati District, Takeo Province. 4.8 Cheung Prey Unit Office Phone: (855) 32 638 0002 National Road Nº 6, Skun Village, Sotip Commune, Cheung Prey District, Kampong Cham Province.
3.3 Tram Kok Sub Branch Office Phone: (855) 93 555 312 4.9 Bek Anloung Unit Office National Road Nº 3, Prey Romdeng Village, Ang Tasom Commune, Tram Kok District, Takeo Province. Phone: (855) 32 638 0007 Bek Anloung Village, Arak Tnoat Commune, Stueng Trong District, Kampong Cham Province. Phone: (855) 93 555 313 3.4 Kirivong Sub Branch 5. SOUNG BRANCH Kampong Village, Choun Chum Commune, Kirivong District, Takeo Province. 5.1 Soung Branch and Sub Branch Office Phone: (855) 88 371 6737 National Road Nº 7, Choeung Lorng Village, Sangkat Soung, Krong Soung, Kampong Cham Province. 3.5 Kampong Chreuy Unit Office Phone: (855) 42 638 0005
House Nº 129, National Road Nº 2, Group 5, Kampong Chreuy Village, Smorng Commune, 5.2 Memot Sub Branch Office Treang District, Takeo Province. Phone: (855) 32 638 0003 National Road Nº 7, Masin Tek Village, Memot Commune, Memot District, Kampong Cham Province. Phone: (855) 42 638 0007 4. KAMPONG CHAM BRANCH 5.3 Ponhea Kraek Sub Branch Office 4.1 Kampong Cham Branch and Sub Branch Office National Road Nº 7, Stueng Village, Koang Kang Commune, Ponhea Kraek District, National Road Nº 7, Boeng Snay Village, Sangkat Sambourmeas, Krong Kampong Cham, Kampong Cham Province. Phone: (855) 42 638 0006 Kampong Cham Province. Phone: (855) 42 638 0001 5.4 Ou Reang Ov Sub Branch Office 4.2 Batheay Sub Branch Office Tomneap Village, Kong Chey Commune, Ou Reang Ov District, Kampong Cham Province. Phone: (855) 42 638 0010 National Road Nº 6A, Ph’av Village, Ph’av Commune, Batheay District, Kampong Cham Province. Phone: (855) 42 638 0003 5.5 Kraek Sub Branch Office National Road Nº 72, Chimoin Lech Village, Kraek Commune, Ponhea Kraek District, 4.3 Prey Chhor Sub Branch Office Kampong Cham Province. Phone: (855) 43 641 2111 National Road Nº 7, Daun Dey Village, Chrey Vien Commune, Prey Chhor District, 5.6 Rokarpor Pram Unit Office (Trapaing Russei Unit Office) Kampong Cham Province. Phone: (855) 42 638 0002 Trapaing Russei Village, Rokarpor Pram Commune, Tbaung Khmum District, Kampong Cham Province. 4.4 Chamkar Leu Sub Branch Office Phone: (855) 42 638 0020
National Road Nº71, Thnal Bek Koeut Village, Svay Teap Commune, Chamkar Leu District, 5.7 Dambe Sub Branch Office Kampong Cham Province. Phone: (855) 42 638 0004 National Road Nº 73, Dambe Village, Dambe Commune, Dambe District, Kampong Cham Province. Phone: (855) 42 638 0030 4.5 Stueng Trang Sub Branch Office
Beoung Deng Village, Prek Kok Commune, Stueng Trang District, Kampong Cham Province. Phone: (855) 42 638 0009
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6. NEAK LOEUNG BRANCH 8. KAMPONG CHHNANG BRANCH
6.1 Neak Loeung Branch and Peam Ro Sub Branch Office 8.1 Kampong Chhnang Branch and Sub Branch Office
National Road Nº 1, Village 1, Preak Khsay Khor Commune, Peam Ro District, Prey Veng Province. National Road Nº 5, Damnak Popoul Village, Sangkat Kampong Chhnang, Krong Kampong Chhnang, Phone: (855) 43 638 0001 Kampong Chhnang Province. Phone: (855) 26 638 0001 8.2 Kampong Trolach Sub Branch Office 6.2 Leuk Dek Sub Branch Office Kaort Village, Peany Commune, Kampong Trolach District, Kampong Chhnang Province. Kampong Chamlorng Village, Prek Tonlaob Commune, Leuk Dek District, Kandal Province. Phone: (855) 26 638 0002 Phone: (855) 43 638 0002 8.3 Boribo Sub Branch Office 6.3 Baphnom Sub Branch Office Cheung Khnar Village, Ponley Commune, Boribo District, Kampong Chhnang Province.
House Nº 45, Chhoeur Kach Village, Chheour Kach Commune, Baphnom District, Prey Veng Province. Phone: (855) 26 638 0003 Phone: (855) 43 638 0004 8.4 Kampong Leng Sub Branch Office Kampong Boeng Village, Kampong Hao Commune, Kampong Leng District, Kampong Chhnang Province. 6.4 Kampong Trabek Sub Branch Office Phone: (855) 26 638 0004 Doun Tung Village, Prasat Commune, Kampong Trabek District, Prey Veng Province. 8.5 Toek Phos Sub Branch Office Phone: (855) 43 638 0005 Sre Tachey Village, Ark Phiwat Commune, Toek Phos District, Kampong Chhnang Province. 6.5 Preah Sdach Sub Branch Office Phone: (855) 26 638 0005
Krosaing Toung Village, Ang Reach Commune, Preah Sdach District, Prey Veng Province 8.6 Oddong Sub Branch Office Phone: (855) 43 639 0001 National Road Nº 5, Tep Pror Nom Village, Vihea Luong Commune, Pongnea Leu District, Kandal Province. Phone: (855) 24 638 0003 7. PREY VENG BRANCH 9. SIEM REAP BRANCH 7.1 Prey Veng Branch and Svay Antor Branch Office 9.1 Siem Reap Branch and Sub Branch Office Pou Chentam Village, Svay Antor Commune, Svay Antor District, Prey Veng Province. House Nº 29, Group 4, Ta Phul Village, Sangkat Svay Dangkum, Krong Siem Reap, Phone: (855) 43 638 0003 Siem Reap Province. Phone: (855) 63 638 0001 7.2 Pea Reang Sub Branch Office 9.2 Puok Sub Branch Office House Nº 174, National Road Nº 8, Group 16, Snay Pol Village, Roka Commune, Pea Reang District, National Road Nº 6, Otaprak Village, Pouk Commune, Pouk District, Siem Reap Province. Prey Veng Province. Phone: (855) 43 670 9666 Phone: (855) 63 638 0002
7.3 Prey Veng Sub Branch Office 9.3 Sothnikom Sub Branch Office House Nº 8, National Road Nº 6, Domdek Phsa Village, Domdek Commune, Sothnikom District, House 01, Group 1, Village 4, Sangkat Kampong Leav, Krong Prey Veng, Prey Veng Province. Siem Reap Province. Phone: (855) 63 638 0003 Phone: (855) 43 639 0002 9.4 Kralanh Sub Branch Office 7.4 Kamchay Mear Sub Branch Office House Nº 39, National Road Nº 6, Group 1, Kampong Thkov Village, Kampong Thkov Commune, House Nº 09, National Road Nº 8, Group 10, Chhor 2 Village, Kronhoung Commune, Kralanh District, Siem Reap Province. Phone: (855) 63 638 0004 Kamchay Mear District, Prey Veng Province. Phone: (855) 43 670 9333 10. BATTAMBANG BRANCH 7.5 Kanh Chriech Unit Office 10.1 Battambang Branch and Sub Branch Office Prongeuy Muoy village, Thma Pun Commune, Kanh Chriech District, Prey Veng Province. House Nº 33, National Road Nº 5, Group 2, Romchek 5 Village, Sangkat Rottanak, Krong Battambang, Phone: (855) 043 636 3345 Battambang Province. Phone: (855) 53 638 0001 7.6 Kampong Popil Unit Office 10.2 Moung Russei Sub Branch Office House 271, Kampong Popil Village, Kampong Popil Commune, Pea Reang District, National Road Nº 5, Group 5, Moung Village, Moung Commune, Moung Russei District, Prey Veng Province. Phone: (855) 043 666 7121 Battambang Province. Phone: (855) 53 638 0002 64 65 ANNUAL REPORT 2013 ANNUAL REPORT 2013 ANNUAL REPORT 2013 KREDIT Microfinance Institution Plc.
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10.3 Thma Koul Sub Branch Office 13.2 Angkor Cheuy Sub Office
House Nº 76, Group 7, Thma Koul Village, Ta Mern Commune, Thma Koul District, Battambang Province. National Road 31, Bral village, Tani Commune, Angkor Cheuy District, Kampot Province. Phone: (855) 53 638 0003 Phone: (855) 33 630 0003
10.4 Mongkol Borei Sub Branch Office 13.3 Kampong Trach Sub Office
House Nº 265, Group 15, Kouk Svay Village, Russei Kraok Commune, Mongkol Borei District, National Road Nº 33, Kampong Trach 1, Kampong Trach Khang Keut, Kampong Trach District, Bateay Meanchey Province. Phone: (855) 54 638 0004 Kampot Province. Phone: (855) 12 453 033
10.5 Ratanak Mondul Sub Branch Office 14. PURSAT BRANCH 14.1 Pursat Branch and Sub Branch House Nº 156, National Road Nº 57, Group 01, Sdao Village, Sdao Commune, Ratanak Mondul District, Battambang Povince. Phone: (855) 53 638 0005 National Road Nº 5, Sathani Village, Sangket Svay At, Pursat Town, Pursat Province. Phone: (855) 77 449 072 11. KRATIE BRANCH 14.2 Krokor Sub Branch Office 11.1 Kratie Branch and Sub Branch Office Samrorng Village, Kbal Trach Commune, Krokor District, Pursat Province. House Nº 541, Wat Village, Sangkat Kratie, Krong Kratie, Kratie Province. Phone: (855) 95 633 362 Phone: (855) 72 638 0001 14.3 Bakan Sub Branch Office 11.2 Chhlong Sub Branch Office National Road Nº 5, Group 19, Boeung Khna Village, Boeung Khna Commune, Bakan District, Chrouy Tmor Krorm Village, Chhlong Commune, Chhlong District, Kratie Province. Pursat Province. Phone: (855) 93 555 268 Phone: (855) 72 638 0002
11.3 Sam Bo Sub Branch Office
Keang Phra Sat Village, Sam Bo Commune, Sam Bo District, Kratie Province. Phone: (855) 72 638 0003
12. SVAY RIENG BRANCH
12.1 Svay Rieng Branch and Sub Branch Office
Rorng Bonlaer Village, Sangkat Svay Rieng, Krong Svay Rieng, Svay Rieng Province. Phone: (855) 44 638 0001
12.2 Bavet Sub Branch Office
National Road Nº 1, Toul Ampel Village, Sangkat Chrokmtes, Krong Bavet, Svay Rieng Province. Phone: (855) 44 638 0002
12.3 Romeas Hek Sub Branch Office
Krosang Village, Krosang Commune, Romeas Hek District, Svay Rieng Province. Phone: (855) 44 638 0005
13. KAMPOT BRANCH
13.1 Kampot Branch and Chhouk Sub Branch
National Road Nº 3, Satv Pong Village, Satv Pong Commune, Chhouk District, Kampot Province. Phone: (855) 33 651 4747
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HEAD OFFICE Building #71, St.163, Sangkat Toul Svay Prey I, Khan Chamkarmorn, Phnom Penh, Kingdom of Cambodia. Phone : (855) 23 217 942 / (855) 89 98 98 18, Fax : (855) 23 217 942 E-mail : [email protected], Website: www.kredit.com.kh