On February 7, 2024, the Securities and Exchange Regulator of Cambodia (SERC) and the Asian Development Bank (ADB) co-organised the Technical Assistance Workshop for the Rating Agency of Cambodia on “Capacity Building for Stakeholders” under the presidency of H.E. Sou Socheat, Director General of the SERC; Vivek Rao, Principal Financial Sector Specialist of ADB; and Sisowath Chakara, Executive Director of the Rating Agency of (Cambodia) Plc.
The workshop aimed to develop a common understanding with stakeholders on data requirements, data formats, and the typical risk profile of AAA, AA and BBB risk categories, based on international best practices of balance sheet metrics, methodology of constructing algorithms for developing the transition matrix of ratings, and a case study on the evolution of creating the Cambodian rating agency.
“The presence of a local rating agency in Cambodia is the right path to earn investors’ trust and promote the credibility of the corporation in Cambodia,” H.E. Sou Socheat remarked during the workshop.
“In order to deliver independent and transparent ratings, the relevant stakeholders and our local rating agency need to be equipped with the best-practices of the rating process and methodology that are comparable with our regional peers. The intervention from the regulator together with the development partner in financial literacy in rating will build a robust and sustainable financial ecosystem. When companies are well-prepared and ready to gain the best credit rating, this will move us toward sustainable economic growth in Cambodia,” he further added.
Rao also emphasised that, “Ratings play a key role in expanding capital markets and are instrumental in promoting market liquidity. Credible ratings based on international best practices and backed with rigorous data collection and analysis will provide comfort to issuers, investors and guarantors.”
“The Capacity Building for Stakeholders workshop co-organised by ADB and SERC fostered awareness among companies, increased investors’ knowledge and raised the technical skills of staff and regulators,” added Chakara. “It constituted a critical step in building the systems and expertise required for the efficient assessment of credit risk in the Cambodian capital markets. Well-functioning capital markets are an essential engine of economic growth.”
The workshop was attended by 80 participants who make up senior executives and officials of the SERC, the National Bank of Cambodia (NBC), the General Department of Policy of the Ministry of Economy and Finance, the National Social Security Fund (NSSF), the Cambodia Securities Exchange (CSX), the Cambodia Association of Securities Firms (CASF), the Credit Guarantee Corporation of Cambodia (CGCC), listed companies, potential investors and other key stakeholders. Speakers were comprised of experts in the field with many years of experience from ADB and from working in India.
This article was adapted from a supplied press release.
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