Government approves draft directive on corporate bond issuance

The government has approved three draft directives on corporate bonds that will pave the way for the issuance of the debt security, a new capital market tool allowing companies to raise funds for expansion, debt refinancing, or acquisitions, according to government officials. In a press release, the Securities and Exchange Commission of Cambodia (SECC) said it had approved three initiatives that solve the remaining regulatory hurdles for bond issuance, bond representatives, and allowing credit rating agencies to provide ratings. Sou Socheat, director-general of the SECC, said that with the regulations for a corporate bond market in place, companies seeking to issue bonds can now submit a letter of intention to the market regulator for approval. SECC has identified three different types of corporate bonds it would potentially issue, including a secured bond, guaranteed bond, and a plain bond, providing an international credit rating agency can give them a value. Han Kyung Tae, managing director of Yuanta Securities (Cambodia), was pleased that the government has finally made tangible progress in establishing a local bond market. He said a diversified product line would help the sluggish local capital market garner more interest from investors. (Source: Phnom Penh Post)