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MFI investment

Posted: Sat May 04, 2019 9:58 am
by Birdy
Anyone with experience of Cambodian MFI’s and risk reward?I am retired and live here if that makes a difference.
Thanks

Re: MFI investment

Posted: Sat May 04, 2019 10:04 am
by Kammekor
Birdy wrote:
Sat May 04, 2019 9:58 am
Anyone with experience of Cambodian MFI’s and risk reward?I am retired and live here if that makes a difference.
Thanks
I've been using them since 2011 without problem. But do I really trust them? No.

I use about 3 or 4 of them so I don't have to all the eggs in one basket.

Do checks on the interest they offer. Some of them offer really low rates on normal savings these days (for instance: Sathapana only 1%).

Re: MFI investment

Posted: Sat May 04, 2019 12:16 pm
by Bitte_Kein_Lexus
Been with Prasac pretty much since they opened. Good service and rates. As with anything though, I wouldn't put all my eggs in one basket, especially if retired. Just use common sense and you'll be fine. Good place to park money.

Re: MFI investment

Posted: Sat May 04, 2019 1:40 pm
by armchairlawyer
AFAIK, three deposit-taking institutions in Cambodia have been rated by credit rating agencies. Acleda and ABA have been rated B+ and B respectively by Standard and Poors. Hatha Kaksekar has been rated BBB+ by Tris.

This article is worth reading, https://www.khmertimeskh.com/553945/sp- ... oderating/

Re: MFI investment

Posted: Sun May 05, 2019 7:30 am
by Birdy
Thanks for the help :good:

Re: MFI investment

Posted: Sun May 05, 2019 10:02 pm
by yongchi
A few years agp, I looked into depositing funds into MFIs.
Since there is obviously risk involved, I found it important to look into ownership and loan portfolio growth rate among other indicators. I wanted shareholders who have a reputation to lose and moderate, but not too agressive growth.
I only considered the then five largest MFIs, and at that time found Amreth most favorable. They were not paying the highest interest rate.
I also liked that their average loan size was smaller than, for example Prassac’s.
In the meantime, a lot has changed. I believe Prassac and Sathapana may have become banks? I don’t know what that would entail.
I am by no means an MFI expert.
You have to do your own due diligence.
Make a shortlist. Then go on the MFIs’ websites and look at their reports. Find out who owns them and how the ownership has changed over time. Who are they lending to?
MFIs pay a higher interest rates for a reason-risk ( riskier borrowers, riskier country).
Ask yourself, if they are taking 20+ percent from borrowers how do they themselves assess their risk?
I still use them. Unlike with banks in many developed countries, I don’t think there is any deposit insurance though.

It be great to hear where your research leads you and where not.

Re: MFI investment

Posted: Sun May 05, 2019 10:32 pm
by logos
I used amk in the past for low 6 figures amounts. Never had any issues, excellent service and back then around 9,5% in riel if you left it 18+ months so no complaints. They've been bought since so no Idea how they are now.

Re: MFI investment

Posted: Wed May 08, 2019 1:46 pm
by Birdy
The banks give about 5.5%.Would this be a less risky option?

Re: MFI investment

Posted: Wed May 08, 2019 3:21 pm
by logos
Birdy wrote:
Wed May 08, 2019 1:46 pm
The banks give about 5.5%.Would this be a less risky option?
Not necessarily. Depends on the balance sheet and the %age of NPL (non performing loans). It's actually much lower in most MFI (and Cambodian banks) than in some large western banks with huge mortgage exposure.

Re: MFI investment

Posted: Wed May 08, 2019 3:38 pm
by Spigzy
MFIs have a roller coaster NPL chart versus steadier lending by MDIs & the banks in country. Stick to the big boys.

NBC financial stability review here:
https://www.nbc.org.kh/download_files/p ... pr2019.pdf

The NBC annual report usually contains the relevant figures on each bank, MDI & MFI to give you more confidence.