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ACLEDA Bank to Increase Capital, Seek Commercial Bank License

September 15, 2003

Phnom Penh — September 15, 2003 — ACLEDA BANK LIMITED, Cambodia's leading microfinance institution which celebrates its tenth anniversary this year, is to raise its capital from US$4 million to US$13 million it was announced today. At a ceremony held in the bank's headquarters on Mao Tse Tung Boulevard last week the shareholders, which include the International Finance Corporation, DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbH, (Germany) Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N. V., Stichting Triodos Doen, and Triodos Custody B.V., of the Netherlands, all agreed to subscribe to the additional capital in the form of a rights issue. The bank will convert each of the existing 400,000 US$10 shares into 10 new shares of US$1 each and issue a further 9 million new US$1 shares all of which will be fully paid up.

In addition, the bank is to seek a license to provide full commercial and retail banking services. 'We have experienced rapid expansion since we were first licensed as a Specialized Bank three years ago', said Mr. In Channy, General Manager, citing the increase of from 56 offices in January, 2001 to 94 in 14 provinces today. 'We now have nearly 100,000 borrowing customers and more than 30,000 depositors. Moreover, the range of services now being provided, which includes provincial and overseas funds transfers, company payrolls and Cash Management, have opened up opportunities for new relationships to complement our core small scale lending business. With the additional capital we will be able to offer a wider range of products and services as our traditional clients move up the economic ladder as well as gain access to new segments of the market.

Former central banker and now ACLEDA's Chairman, Mr. Chea Sok, stressed the benefits of having a stronger capital base. 'In the current economic climate risk is everywhere and customers from the small individual depositor with his hard earned pay-check to the larger commercial enterprise with funds moving through the retail network are increasingly questioning their bank's strength and ability to protect their assets. After this increase ACLEDA Bank will have one of the strongest balance sheets in the country with capital adequacy well in excess of both NBC and international norms', he said. 'In addition, splitting the shares into US$1 units is intended to make share ownership more accessible in the future to the many individuals who make up a large part of the 51% majority Cambodian ownership of the bank.'

It is expected that the capital increase and re-licensing will be completed before the end of October, a spokesperson for the bank said.