safest bank here (in the event of economic collapse)??
safest bank here (in the event of economic collapse)??
What do you reckon would be the safest bank in Cambodia (for having money deposited in) in the event that the economy collapsed?
- truffledog
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Re: safest bank here (in the event of economic collapse)??
NONE
work is for people who cant find truffles
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- Bitte_Kein_Lexus
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Re: safest bank here (in the event of economic collapse)??
Exactly. Why would you store money in a bank (or even keep fiat for that matter) if you fear either a local or global economic collapse.
Ex Bitteeinbit/LexusSchmexus
- armchairlawyer
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Re: safest bank here (in the event of economic collapse)??
Taking a less absolute view (and in so doing answering the question), firstly I say that no bank in the world is safe. Some countries have deposit guarantee schemes but there is no guarantee that they will honour them. Iceland did not in 2008.
There has been no instance of depositor loss in Cambodia since 2000, although there have been rare instances of deferred payment.
So, the relevant points are:
1. There is no deposit guarantee scheme in Cambodia.
2. The risks can be split into bank-specific and economy-wide.
3. The latter risk could consist of a redenomination of USD balances into local currency with consequent devaluation of local currency. This has never happened in Cambodia AFAIK but it has a track record in several Latin American countries.
4. In global terms bank specific risk is primarily caused by commercial real estate lending. No reason to think Cambodia is any different.
5. The MDIs in Cambodia have very low rates of non-performing loans but very high ratios of loans to deposits. The commercial banks in Cambodia have higher NPLs but lower loan to deposit ratios. So, I would argue the risks are similar across the two categories. Except see number 4 above which applies to some of the banks but not to the MDIs.
6. There has been very high rates of growth of lending and deposit taking in the last decade. This is a source of concern especially when economic growth falls rapidly, as is the case now.
7. There have been aggressive practices of lending by many banks and especially MDIs.
8. The MDIs pay higher rates of interest than the banks especially on fixed terms. I say they do not necessarily present higher risk.
9. The best safeguard in the event of bank specific problems is the identity and attitude of the parent bank (if any). So, for the safest, look for the best quality parent banks and the degree to which they allow their name to be associated with the Cambodian subsidiary bank. Obvious examples atm are CIMB, Maybank, Prasac and ABA. But be aware that the Cambodian subsidiaries change hands quite often. Prasac is a good example of this.
10, AFAIK, only three Cambodian banks have been credit rated. They all have a rating of B. This is well below investment grade. The best rated parent bank is CIMB (AA).
11. Banks suffer when interest rates are low and this is going to be a major problem for banks in the Americas and Europe. Combined with economic problems, there is likely to be a rise in bank failures around the world.
That's the long answer. The short answer is CIMB.
There has been no instance of depositor loss in Cambodia since 2000, although there have been rare instances of deferred payment.
So, the relevant points are:
1. There is no deposit guarantee scheme in Cambodia.
2. The risks can be split into bank-specific and economy-wide.
3. The latter risk could consist of a redenomination of USD balances into local currency with consequent devaluation of local currency. This has never happened in Cambodia AFAIK but it has a track record in several Latin American countries.
4. In global terms bank specific risk is primarily caused by commercial real estate lending. No reason to think Cambodia is any different.
5. The MDIs in Cambodia have very low rates of non-performing loans but very high ratios of loans to deposits. The commercial banks in Cambodia have higher NPLs but lower loan to deposit ratios. So, I would argue the risks are similar across the two categories. Except see number 4 above which applies to some of the banks but not to the MDIs.
6. There has been very high rates of growth of lending and deposit taking in the last decade. This is a source of concern especially when economic growth falls rapidly, as is the case now.
7. There have been aggressive practices of lending by many banks and especially MDIs.
8. The MDIs pay higher rates of interest than the banks especially on fixed terms. I say they do not necessarily present higher risk.
9. The best safeguard in the event of bank specific problems is the identity and attitude of the parent bank (if any). So, for the safest, look for the best quality parent banks and the degree to which they allow their name to be associated with the Cambodian subsidiary bank. Obvious examples atm are CIMB, Maybank, Prasac and ABA. But be aware that the Cambodian subsidiaries change hands quite often. Prasac is a good example of this.
10, AFAIK, only three Cambodian banks have been credit rated. They all have a rating of B. This is well below investment grade. The best rated parent bank is CIMB (AA).
11. Banks suffer when interest rates are low and this is going to be a major problem for banks in the Americas and Europe. Combined with economic problems, there is likely to be a rise in bank failures around the world.
That's the long answer. The short answer is CIMB.
- newkidontheblock
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Re: safest bank here (in the event of economic collapse)??
OP asked if the local economy collapsed and there is a run on banks, etc. not total societal collapse. Big difference.wolfcreek wrote:What do you reckon would be the safest bank in Cambodia (for having money deposited in) in the event that the economy collapsed?
First, keep a big cash reserve, not in a bank. An emergency fund of 3-6 months, at least. The government may declare a bank a holiday and freeze or limit all bank withdrawals. Keep a bunch in small jewelry, like 18K or 24K gold, that can be weighed for value.
If Riel money becomes worthless, gold jewelry will rise in value. Small amounts can be weighed and bartered.
Otherwise, international banks are the best bet. MFIs and local banks might collapse. International banks are backed with western overseas accounts.
If society collapses and there is no more government, expect the denizens of China city to take over. Even the local poor of China city carry every manner of weapons. You will need guns, ammunition, food, medicine (antibiotics). Since by Cambodian law, you are not allowed to possess guns or ammunition, and most Khmer don’t use medicine, stock up on food. And move to the countryside. Cities require elaborate infrastructure networks that will be the first to breakdown.
Or flee to Texas. Otherwise the bodyguard unit will come and take your food.
I’ll put my tin foil hat back on, now.
Good luck!
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Re: safest bank here (in the event of economic collapse)??
Good advice, for a SHTF outcome, especially the trade able gold and cash stockpile, but hard for a lone barang to do.
- alexvanlaar
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Re: safest bank here (in the event of economic collapse)??
ABA and Canadia
Re: safest bank here (in the event of economic collapse)??
All of the banks in Cambodia are really little more than microfinance institutions. Since they are all lending to Cambodians any economic collapse will destroy all of them. Remember Thailand in 1997 when ALL finance companies collapsed plus several banks. Armchairlawyer is correct in his detailed analysis. Note also that although foreign banks may be strong, they generally do not guarantee deposits in their subsidiaries.
On the other hand there is risk in every bank in the world (remember Lehman Brothers et al). The risk is generally reflected in the reward. Interest rates in Cambodia are high to reflect this risk. The safest bank in the world is said to be OCBC in Singapore but their best interest rate is 0.1% per year.
On the other hand there is risk in every bank in the world (remember Lehman Brothers et al). The risk is generally reflected in the reward. Interest rates in Cambodia are high to reflect this risk. The safest bank in the world is said to be OCBC in Singapore but their best interest rate is 0.1% per year.
- Clutch Cargo
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Re: safest bank here (in the event of economic collapse)??
ABA is 100% owned by the National Bank of Canada after it bought out the Russian's 10% holding recently.
Does it make it any safer?
Does it make it any safer?
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