The FINANCIAL -- IFC, a member of the World Bank Group, has signed a memorandum of understanding with the National Bank of Cambodia to strengthen corporate governance practices among banking and financial institutions. The partnership aims to improve transparency and increase public confidence in the banking sector.
IFC will help the National Bank of Cambodia enhance its regulatory, supervisory, and enforcement capabilities by developing and providing corporate governance training and workshops to the bank’s staff. The central bank, together with IFC, will develop a corporate governance code, which will set best practices for banking and financial institutions in Cambodia to follow.
“Prudential risk management and internal control are important to the sustainable development of Cambodia’s banking industry,” said Rath Sovannorak, Deputy Director General of Banking Supervision of the National Bank of Cambodia. “We expect the project to send a strong message about the banking sector's commitment to further improve upon its corporate governance practices and thus integrate into the global financial system.”
Prior to the effort with IFC, the National Bank of Cambodia has focused on improving corporate governance through issuing regulations to govern and supervise the corporate governance practices of banking and financial institutions. In addition to the NBC’s commitment, the assistance from IFC will contribute to a wide scope of capacity building and the implementation of proper corporate governance practices in the banking sector.
The two institutions will co-organize a series of public seminars and workshops to raise awareness of corporate governance principles. These opportunities for learning will reinforce effective means of risk management, compliance, and control functions within the banking industry, according to IFC.
“Our cooperation with the National Bank of Cambodia will help improve transparency and risk management practices in the banking sector,” said Kyle Kelhofer, IFC Country Manager for Cambodia, Lao People’s Democratic Republic, and Vietnam. “This will help banking and financial institutions mitigate lending risks and increase access to finance for both businesses and individuals, which will in turn contribute to further sustainable economic development of Cambodia.”
IFC has contributed to the adoption of 95 corporate governance codes, laws, and regulations in more than 30 countries worldwide. In East Asia and the Pacific, IFC advised on the first corporate governance manual for Vietnamese companies and helped Indonesia’s financial services authority, Otoritas Jasa Keuangan, develop its Corporate Governance Roadmap and Code.
IFC’s Corporate Governance Program in East Asia and the Pacific is funded by the State Secretariat for Economic Affairs of Switzerland.