Credit risk

Leading financial information provider introduces ‘credit risk heatmap’ to monitor levels

Outstanding loans in banks and microfinance institutions (MFIs) reached $51.5 billion as of June 30, marking a 23.4 percent year-on-year increase. YOUSOS APDOULRASHIM

Leading financial information provider introduces ‘credit risk heatmap’ to monitor levels

Credit Bureau (Cambodia) Co Ltd (CBC) on July 31 launched a “credit risk heatmap” tool allowing financial institutions to monitor credit risk levels across multiple geographies.

The tool is CBC’s latest solution in the form of a dynamic, interactive map that allows credit institution executives and senior managers to “easily navigate their institution’s credit risk from location to location. other “.

Oeur Sothearoath, CEO of CBC, said that over the past few years, the financial sector in Cambodia has undergone a digital transformation and made leaps and bounds in data analytics capabilities.

With the gradual growth of the credit market today, CBC is able to serve the needs of 180 member banks, microfinance institutions (MFIs), leasing companies and rural credit institutions.

“On the one hand, our members are expanding their business into new markets. On the other hand, they must also ensure that they operate at an optimal level of risk in the existing markets.

“Thereby, [the development] heat map to complete [our] data analysis report [DAR] based on the changing needs of our members,” he explained.

As a result, the heatmap not only reflects the latest market trends, but also meets the emerging data needs of financial institutions.

Additionally, CBC has considered member needs and added dynamic navigation features to explore performance at the commune level, compare an institution’s credit quality and performance of restructured loans to the industry average. and extract data from the map for further analysis.

“With information on borrower credit performance, history and transactions at the commune, district and provincial levels, financial institutions can redefine portfolio risks, market strategies and product planning based on the needs of their consumers in the target geographies,” CBC said.

The credit risk heatmap, together with the DAR, is expected to improve the accuracy of risk avoidance, default account investigations, and ensure safer and higher loan quality for financial institutions by offering insights into the data.

A recent report by the National Bank of Cambodia (NBC) showed that outstanding loans in banks and MFIs reached $51.5 billion as of June 30, a year-on-year increase of 23.4%. Customer deposits increased 16% to $42 billion.

He also said aggregate non-performing loans (NPLs) from banks and MFIs stood at “controllable rates” of 2.6% and 2.3%, respectively.

As of June 30, Cambodia had 57 commercial banks, nine specialized banks, five depository MFIs, 80 non-depository MFIs, 231 rural credit institutions and 17 leasing companies.

In 2020, CBC revamped its DAR suite of business intelligence dashboards that enabled senior executives at member financial institutions to strategically and tactically track their performance.