Canadia Bank, one of Cambodia’s largest and most established financial institutions, is navigating an increasingly complex financial landscape with a strategic focus on stability, innovation, and community impact. Led by CEO Raymond Sia, the bank’s experienced leadership team draws from diverse backgrounds, uniting local insights with international expertise to advance Canadia Bank’s vision. Sia’s prudent risk management underpins the bank’s approach, positioning it for sustainable growth that reflects its commitment to customers and Cambodia’s broader development goals.

Founding legacy and growth of Canadia Investment Holding

Canadia Bank was founded in 1991 as Canadia Gold and Trust Corporation by Pung Kheav Se (Dr Pung), whose journey exemplifies resilience and vision. Dr Pung escaped Cambodia, as a refugee during the Khmer Rouge civil war, to Thailand before eventually settling in Canada. There, he established himself as a successful entrepreneur in the gold and jewellery business. Driven by a desire to contribute to his homeland, he returned to Cambodia in the early 1990s and founded Canadia Bank with the aim of building a stable financial institution that could support the country’s economic recovery and growth.

Today, the bank’s parent company, Canadia Investment Holding (CIH), is one of the largest and most diversified conglomerates in Cambodia, overseeing several financial institutions, including Cambodia Post Bank and Funan Microfinance, Canadia Bank Lao, Canadia Securities, and Sovannaphum Life Assurance. Dr Pung’s influence has shaped CIH’s expansion across finance, insurance, real estate, and infrastructure, positioning it as a cornerstone of Cambodia’s economic transformation.

Prudent liquidity management

In a highly competitive banking sector, Canadia Bank has distinguished itself through prudent liquidity management. Sia, whose experience at Malaysia’s Public Bank, known for its business and operational efficiency, has instilled a disciplined approach and implemented a strategy prioritising capital strength and stability over rapid expansion. With a loan-to-deposit ratio (LDR) of around 75-80%, Canadia maintains a strong buffer that enables it to sustain a high liquidity position even in volatile market conditions.

While the industry as a whole sees increasing trends of investment in bonds, Canadia has chosen to invest its excess funds in the interbank market, prioritising flexibility and risk reduction. “Our disciplined liquidity management allows us to support our clients and ensure resilience amid any economic headwinds,” Sia explained. This conservative approach aligns with recent industry challenges, as Cambodia’s credit growth has slowed from annual rates of over 30% to around 17% in 2023, and single digit in 2024, according to data from the National Bank of Cambodia.

Digital transformation

Cambodia’s banking sector is undergoing rapid digitalisation, and Canadia Bank is keeping pace with a strategy led by chief information officer (CIO) Howard Lau, who joined Canadia Bank in 2022 and worked previously in a prestige bank, a pioneer in self-service banking and digital innovation in Asia. He has overseen substantial upgrades to Canadia’s digital platforms, including a revamped mobile app. In 2023 alone, the bank saw a 140% increase in active mobile users versus the previous year, reflecting Cambodia’s growing appetite for digital banking.

Lau emphasised, “Our digital investments are about creating a secure, seamless experience for customers, addressing both convenience and security.” Recognising that a substantial portion of Cambodia’s rural population remains unbanked, Canadia introduced a hybrid onboarding process where customers receive assistance in branches, using tablets to ease their transition into digital banking. This inclusive approach supports Cambodia’s rural population, where approximately 45% of adults remain unbanked, according to the World Bank’s Global Findex data. By blending digital solutions with personalised support, Canadia is fostering trust and accessibility across its customer base.

Managing credit underwriting challenges and growth

With a highly fragmented banking sector, Canadia Bank faces challenges in credit underwriting, particularly in gathering adequate financial documentation from small and medium sized enterprises (SMEs) and rural customers who may lack formal financial records. Chief operating officer (COO) Song Khenglay, who has a deep understanding of Cambodia’s market dynamics, explained, “For SMEs in rural regions, the ease of accessing funds quickly is often prioritised over the formal processes we have in place. It’s a delicate balance we navigate daily.”

To bridge these gaps, Canadia has partnered with SME communities through various business associations to promote financial literacy, helping customers understand the benefits of financial records, business documentation and transparency. These initiatives are particularly relevant as Cambodia’s non-performing loans (NPLs) have risen to 5.4% industry-wide in 2023, up from 3.1% in 2022, and deteriorated further in 2024. This increase reflects economic pressures, particularly in the real estate sector, which has historically driven much of Cambodia’s gross domestic product (GDP) growth. Through responsible lending practices, Canadia continues to support SME growth while mitigating risks associated with unverified credit histories.

Focus on ESG and financial inclusion

Head of marketing and communications Manilyn Zara Tobeo spearheads Canadia Bank’s campaigns to support environmental, social and governance (ESG) initiatives, notably through the “Canadia Bank Cares” programme. Since its inception, this initiative has provided over 6,000 people in rural areas with financial literacy training, underscoring the bank’s mission to empower underserved communities. Tobeo elaborated, “Our engagement with customers goes beyond transactions. We aim to support them with resources that empower financial independence.”

Canadia’s commitment to environmental sustainability includes green financing options and partnerships with environmental organisations, and Royal Government of Cambodia for landmine clearance, recycling projects, and clean up drives. These projects are integral to Canadia’s broader ESG framework, aligning the bank’s initiatives with Cambodia’s national development goals as the country balances economic growth with environmental responsibility.

Diverse holdings under CIH and major infrastructure investments

Beyond banking, Canadia Group extends its influence through its subsidiary, Overseas Cambodian Investment Corporation (OCIC), which manages the non-financial sector ventures. OCIC has overseen some of Cambodia’s most significant infrastructure projects, including Koh Pich , a 100-hectare central neighbourhood in Phnom Penh, and Chroy Changvar Satellite City, a near 400-hectare urban development intended to cater to a growing urban population as well as alleviate congestion in the capital.

Other key projects include Norea City, a 125-hectare neighbourhood development, The Olympia City, a commercial and residential hub, and the Techo International Airport Project, expected to bolster Cambodia’s connectivity within ASEAN and to international markets. These projects, which together represent over $6 billion in investment, underscore OCIC’s role as a catalyst for Cambodia’s urbanisation and economic growth, positioning it as a key contributor to national development.

Navigating high-interest caps and economic pressures

The National Bank of Cambodia’s 18% interest rate cap, introduced to protect borrowers, poses challenges and opportunities. While the cap allows banks to maintain healthy margins, it also raises concerns about affordability, particularly as the cost of living rises. “High-interest rates allow for higher margins, but banks must remain mindful of their customers’ long-term financial health,” Sia emphasised, reinforcing the importance of responsible lending.

As NPLs rise across the sector, some banks are struggling to meet profitability targets, with NPL ratios increasing over the past two years. Canadia Bank’s prudent lending strategy has insulated it from these challenges to a degree, though Sia noted that consolidation may be inevitable in Cambodia’s fragmented market. “Consolidation is inevitable as banks face rising costs and profitability pressures. Mergers could strengthen the sector by concentrating resources in well-capitalised institutions,” he said, suggesting that mergers and acquisitions activity could help stabilise the sector.

Supporting SMEs and expanding trade and supply chain finance

Recognising that SMEs constitute around 99% of Cambodian businesses and employ about 70% of the workforce, Canadia Bank has expanded its trade and supply chain finance solutions to support these enterprises. “Our trade finance options are designed to meet SMEs’ financial needs on Account Receivable and Payable Financing and mitigating risks, but we continue educating customers on the benefits of structured trade finance,” Sia explained. These solutions include receivables financing and working capital loans, which help SMEs navigate the complexities of cross-border transactions—a critical need as Cambodia deepens its trade ties under the ASEAN Economic Community and Regional Comprehensive Economic Partnership (RCEP).

Unlike competitors who allegedly offer more lenient credit terms to capture market share, Canadia’s approach combines access with risk mitigation, ensuring sustainable support for SMEs while controlling exposure to defaults. This balanced strategy supports Cambodia’s ongoing industrialisation and integration into regional supply chains.

Vision for sustainable banking and community impact

As Canadia Bank looks toward 2025, its strategy of prudence, innovation, and community engagement reflects its commitment to business and operational resiliency in Cambodia’s dynamic financial sector. By addressing challenges in credit underwriting, digital adoption, and regulatory compliance, Canadia remains dedicated to sustainable growth and responsible banking.

With conservative and prudent liquidity management, inclusive digital solutions, and strong ESG commitments, Canadia Bank is poised to continue its legacy as a trusted partner for Cambodian consumers and businesses. Its multifaceted approach not only seeks to meet market demands but also fosters resilience and inclusivity, contributing meaningfully to Cambodia’s economic and social advancement. Through its leadership in both banking and infrastructure, Canadia and CIH collectively set the benchmark for sustainable growth, helping shape Cambodia’s financial landscape for the future.