ANUKRET DATED JUNE 22, 1992
ON THE ORGANIZATION AND FUNCTIONING OF THE NATIONAL BANK OF CAMBODIA
The Council of Ministers
State of Cambodia
No. 19 An. Kr
and at the request of the Governor of the National Bank of Cambodia;
It is hereby decided:
The People's National Bank of' Cambodia shall change its name to the National Bank of Cambodia called in short the National Bank, being a juridical person and having financial autonomy. The National Bank is the Bank of' the State shall have an equivalent rank as a Ministry and shall report to the Council of Ministers.
The National Bank shall he empowered to monitor the movement of the currency and the credit within the limits of the economic and financial policy of the nation.
The National Bank shall have the following functions:
The National Bank shall have its head office at 22-24 Tou Samouth Boulevard, Phnom Penh.
The National Bank may open branches and agencies throughout the country and may have agents and representatives overseas as deemed necessary by the Board of' Directors. The nomination of agents and overseas representatives shall he approved by the Council of Ministers.
The activities of the National Bank may only be terminated by the adoption of a Law.
Other Financial Institutions in Cambodia may not use in their names the words " National " State " or " Central " or other words reflecting the same meaning.
CAPITAL AND RESERVES
The authorized capital of the National Bank shall he five billion Riel and shall he held by the State. The capital can he increased or decreased according, to the decision of" the Board of Directors with the approval of the Government.
The reserves of' the bank are as follows: General reserves to offset any deficits and other reserves that the Board Directors shall determine, 25 percent of the annual net profits shall be added to the General Reserves.
The remaining profit after other reserve appropriations determined by the Board shall be paid to the budget. When the general reserves equals 100 percent of the capital the Board of Directors shall cease making further transfers.
ADMINISTRATION, SUPERVISION, MANAGEMENT. FUNCTION AND
STRUCTURAL ORGANISATION OF THE NATIONAL BANK
The National Bank shall he administered by the Governor with the assistance of the Deputy Governor and the help of the Board Directors.
The Governor shall he appointed or dismissed by the National Assembly acting upon the recommendation of the Council of Ministers.
The National Bank shall carry out all the operations normally conducted by the Central Bank as follows:
a) Buy and sell of gold, silver and precious stones,
b) Buy, sell and transfer bills of exchange, securities and the share certificates,
c) Keep securities and share certificates in safe custody whether they he principals, dividends or interests,
In accordance with Article 10 the National bank shall he prohibited from:
The National bank is at the headquarters of the state owned specialized banks consisting of commercial. agricultural, savings and development banks. It has the following departments:
1. Administration Department
2. Personnel department
3. Planing and computer Services Department
4. Accounting Department
5. Economic Research Department
6. Supervision Department
7. Financial institution development Fund
8.Issue Management department
9. Banking Department
10. Deposit and Bond Department
The Board of Directors under this Sub-Decree is comprised of the followings:
The Governor and the' Deputy Governor of the National Bank, and Representatives of other institutions appointed by the Council of Ministers, being, not less than five persons. The Chairman and the Deputy Chairman are respectively the Governor and the Deputy Governor of the National Bank.
The Board of Directors shall hold their meetings and gives decisions to the Governor of the National Bank on the followings:
The Governor of' the National Bank shall call a Board meeting each month. A quorum for a meeting of the Board shall he three/ fifths of the members including either the Governor or the Deputy Governor. Decisions shall he taken by a majority vote of' members present and voting, and in the event of a tie the Chairman shall have a casting vote.
ISSUING OF BANK NOTES
The National Bank appoints the Issue Department which has the responsibility for issuing bank notes and managing their circulation.
The National Bank shall maintain the money supply and allocate appropriate level of' bank credit to the agricultural. industrial and commercial sectors within the economy, and to prevent and slowdown the inflationary trends that disrupt the national economic growth. especially through the allocation of credit to the general or selected sectors.
Bank notes issued by the National Bank are legal tender for the payment of' any amount and can circulate without restrictions within Cambodia.
Bank notes of the National Bank are considered to be the legal currency of Cambodia.
FINANCIAL INSTITUTIONS DEVELOPMENT FUND
In this Sub-Decree:
1. "Financial Institutions " means Commercial Bank, Agricultural Bank, Savings Bank, Development Bank, Financial Company, Securities Company, Credit Foncier Company.
2." Fund " means Financial Institutions Development Fund. means the Fund manager.
The Fund Department is the juridical entity established to strengthen and stabilize the financial system.
The Fund consists of:
1. Money received from Financial Institutions
2. Donations of' money and properties
3. Other money and assets devolving to the fund
4. Earnings of the Fund
Financial Institutions shall contribute to the Fund at the rate stipulated by the Fund Management Committee and approved by the Council of' Ministers. The contribution rate shall not exceed 0.5 percent of' deposits and borrowings shown in the balance sheet at the end of the year.
Financial Institutions that fail to pay or that have not paid in full contribution to the Fund as stipulated in Article 23 shall pay, double the unpaid amount in default.
The National Bank shall review its reserves according to Article 7 and may make payment on time accordingly to the Fund when it deems suitable. The National Bank can make loans to the Fund when necessary and such loans shall he repaid within a specified term.
The Fund Department has right to carry out all the fo1lowing tasks:
There shall he a Committee called the Fund Management Committee consisting of the Governor of' the National Bank as Chairman. a Vice Minister of' Finance as Deputy Chairman, a representative of the Council of Ministers and other members appointed by the Council of Ministers. The Committee shall have not less than five members and not more than nine members and the Fund Department shall act as Secretary.
The members of the Committee shall serve for three years.
A quorum for a meeting, of the Fund Management Committee shall be more than half of it members. Decisions shall be taken by majority vote. The Chairman shall have a casting vote in case of a tie.
The Fund management shall have the power to set the policies and manage all other businesses of the Fund as follows:
1. Adopt procedures for the implementation of the articles 23. 24 and 26.
2. Adopt procedures for meetings and activities of the committee.
3. Adopt procedures relating, to the duties for the Manager of the Fund.
4. Arrange any other matters set by the National Bank.
Remuneration for the Fund Management Committee shall he set by the Council of' Ministers.
The Committee shall appoint and dismiss the Manager who shall he treated as an employee of the National Bank.
The assets of the Fund shall he used only to implement the objectives of the Fund, and to meet administrative expenses of the Fund including authorized remunerations.
The Fund shall have its proper accounting system, subject to internal audit of the accounts incomes and expenditures assets and liabilities
The State Audit shall audit the hooks and cash of the Fund each year. The Auditor shall make a full audit report to the Council of Ministers and to the National Bank of Cambodia within ninety days after the financial year end.
RELATIONS WITH THE GOVERNMENT
The National Bank of Cambodia shall keep the deposits of the Ministry of Finances and allow the Ministry to withdraw its money but not in excess of the balance thereon.
The Ministry of Finances shall not pay any fee in respect of its deposits. The National Bank shall not pay deposit interests to the Ministry of Finances.
RESERVES OF BANKS
All Banks shall maintain a prudential reserve of not less than 5 percent and not more than 15 percent of their capital on non-interest earning deposit with the National Bank of Cambodia.
This money can he withdrawn when the bank legally ceases its business. In addition to these deposits the commercial banks shall maintain at the National Bank:
1. In normal cases between 5 percent to 50 percent of' their demand deposit liabilities and 3 percent to 30 percent of their fixed deposit liabilities.
2. In special circumstances 3 percent to 30 percent of their demand deposit liabilities and 2 percent to 20 percent of their fixed deposit liabilities.
The Governor of' the National Bank shall decide the special circumstances of each commercial banks. The term " liability " in this Article shall exclude borrowings from the National Bank.
For the implementation of Article 36, the National Bank has the right to require all banks to submit confidential reports to the National Bank as follows:
The Governor of the National Bank shall implement the Law and shall manage the bank operations and has the right to revoke the license of' any financial institution that fails to observe the above Articles in accordance with the requirements of the Board of Directors, and shall report thereon to the Council of Ministers.
RIGHTS, DUTIES AND ROLES OF THE AUDITOR
The Board of Directors shall propose the appointment of one or more auditors each-year to the Council of Ministers for approval. The first auditor shall work until the completion of the financial year and prepare the balance sheet and profit and loss account as stipulated in
The Board of Directors may renew the appointment of the auditor at the end of the mandate.
The auditor shall not he an employee of' the National Bank or a member of the Board of Directors. In the event the position of auditor becomes vacant during the year the Board may appoint a new auditor automatically to fill the vacancy for the remaining mandate.
The auditor shall examine the regularity and thoroughness of' the balance sheet against inventories in accordance with the banking accounting system.
The auditor may advise the Governor and the Board of Directors on all matters involving the rate of exchange, the discount rate, credit interest rate and the purchase of securities.
The auditor whilst carrying out his duties shall audit the books of accounts and other records of the National Bank and may require from employees explanations as deem necessary.
BALANCE SHEET AND PROFIT AND LOSS STATEEMENT
The fiscal year of the National Bank shall he from the First of January until December 31 of each year.
The National Bank shall submit a weekly standard report of the Issue Department and Banking Department to the Council of Ministers.
Within three months of' the end of' the fiscal year, the National Bank shall submit to the and Council of the Ministers the Balance Sheet, Profit and Loss Statement dated December 31of the previous years, hearing the signatures of the Governor, Deputy Governor, the
Accountant with the confirmation of the auditor together with the Annual Report of the Board of Directors.
The National Bank shall not pay income tax, surtax, profit tax, turnover tax and / or stamp duty according to the Fiscal Law.
Any regulations that contradict this Sub-Decree shall he null and void.
The Minister of' the Cabinet of' the Council of' Ministers and the Governor of' the National
Bank of Cambodia, other Ministers. Directors of Institutions. the Heads of the Provincial Committees, the Municipality of Phnom Penh shall implement this Sub-Decree according to their respective duties.
This Sub- Decree takes effect from the date of its publication.
For the Council of' Ministers
Deputy Prime Minister
Signature and seal