Kingdom of Cambodia

Nation – Religion – King

 

The National Bank of Cambodia

00-38-PrK

PRAKAS

 

Relating to Liquidity for Banks and Micro Financing Institutions

 

 

The Governor of the National Banks of Cambodia

 

-          With reference to the Constitution of the Kingdom of Cambodia;

-          With reference to the Kram NS/RKM/0196/27 of January 26, 1996promulgating the Law on the Organization and Functioning of the National Bank of Cambodia;

-          With reference to the Kram NS/KRM/0196/27 of January 26, 1996 promulgating the Law on the Organization and Functioning of the National Bank of Cambodia;

-          With reference to the Kram NS/KRM/1199/13 of November 18, 1999 promulgating the Law on Banking and Financial Institutions;

-          With reference to the Kret CS/RKT/0398/85 of March 10, 1998 on the appointment of His Excellency Chea Chanto as Governor General of the National Bank of Cambodia;

 

Pursuant to the request of the Banking Supervision Department;

 

Decides as follows:

 

Article 1:

Banks and micro financing institutions hereinafter referred to as banks are required to comply with the management rules aimed at ensuring their liquidity that are laid down in the following articles.

 

Article 2:

Banks shall calculate a liquidity ratio on the basis of their monthly accounting statements.

 

Article 3:

The numerator of the liquidity ratio shall comprise:

             

1.       Where it represents a lender position, the treasury balance as defined in Article 5 of this Prakas.

2.              Portion of lending with not more than one month to run (excluded loans to customers with no date of maturity-overdrafts for instance-)

3.       Treasury bills with not more than one month to run.

 

Article 4:

The denominator of the liquidity ratio shall comprise:

1.              Where it represents a borrower position, the treasury balance as defined in Article 5 of this Prakas.

2.              80 percent of the portion of fixed deposits and certificates of deposit having not more than one month to run.

3.              50 percent of the portion of fixed deposits and certificates of deposit having more than one month to run.

4.              50 percent of saving deposits.

5.              60 percent of demand deposits.

 

Article 5:

The treasury balance is equal to the difference between the total debit items and the total credit items, as listed below:

 

 

1.       Debit items

a.       Cash and gold

b.       Deposits with NBC

c.       Deposits with banks

d.       Portion of lending to banks and financial institutions with not more than one month to run (excluded loans with no date of maturity).

 

2.       Credit items

-        Credit balances on sight accounts maintained with NBC, Banks or financial institutions.

-   Borrowings from NBC and banks with not more than one month to run.

 

The treasury balance is regarded as representing a lender position when the total of the debit items exceeds the total of the credit items. The treasury balance is regarded as representing a borrower position when the total of the credit items exceeds the total of the items.

 

Article 6:

Banks must at all times have a liquidity ratio of at least 100 percent.

 

Article 7:

Banks shall monthly file declarations of their liquidity ratio in accordance with a model drawn up by the National Banks of Cambodia.

 

Article 8:

All provisions, which are contrary to those of this Prakas, are hereby repealed.

 

Article 9:

The General Direction, the General Secretariat, the General Inspection, the General Cashier and all Departments of the National Bank of Cambodia, and all Banking and Financial Institutions under the NBC's supervisory authority shall strictly implement this Prakas.

 

Article 10:

This Prakas shall have effect from this signing date.

 

 

 

Phnom Penh, February 9, 2000

 

The Governor: Chea Chanto