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ACLEDA Bank Enhances Protection for Customers' Assets

January 16, 2007

Front row standing: Mr. In Channy, President & CEO of ACLEDA Bank and Mr. Pascal Brandt-Gagnon, General Manager of Asia Insurance (Cambodia)

Phnom Penh — January 16, 2007 — ACLEDA Bank Plc, the country's foremost retail bank has signed an agreement with Jardine Lloyd Thompson Asia (JLT), a leading supplier of insurance and risk management services and the largest UK insurance broker listed on the London Stock Exchange, and Asia Insurance (Cambodia) Plc. to arrange a comprehensive insurance package to cover the bank's business in Cambodia. The agreement provides for Bankers Blanket Bond, Electronic and Computer Crime, Directors & Officers Liability and Company Reimbursement insurance. It is believed that ACLEDA is the first bank in Cambodia to put in place such an inclusive insurance package which covers such risks as theft of cash and other securities, fraud and embezzlement, forgeries and counterfeiting of valuable documents, computer fraud and malicious attack on the bank's systems and third party liability of its directors and senior management.

JLT Asia's Director of Financial Solutions, Shan Sagoo, said "The dynamic business in which banks operate is made even more complex by the pervasive threat of fraud. The Basel committee on Banking Supervision has identified fraud as amongst the greatest sources of potential operational losses. To combat fraud, constant vigilance through a comprehensive set of internal controls, coupled with insurance as a second line of defence is necessary. ACLEDA Bank's recognition of the role of insurance as a risk mitigate and Asia Insurance's acceptance of this risk bode well for the growing confidence in the Cambodian banking sector."

Left to right: Mr. Chea Sok, Mrs. Shan Sagoo, Mr. In Channy, Mr. Pascal Brandt-Gagnon, and Mr. John Brinsden

Asia Insurance (Cambodia)'s General Manager, Pascal Brandt-Gagnon, stated that "Asia Insurance is proud to be at the forefront of the development of the insurance industry in line with the development of the banking sector. Both industries, and their respective markets alike, can benefit from a growing symbiotic relationship which should see the introduction of a broad range of bancassurance programs tailor made to protect the assets of the depositors. This developing relationship bodes well for both the future of Cambodia's financial services industry and public confidence in this sector alike."

ACLEDA Bank's Chairman, Mr. Chea Sok, a former central banker and economist, explained why the bank felt the need for this additional cover when it had only recently reinforced its financial position with a US$17 million capital increase. "In fact the two are complementary parts of the same strategy", he said, "and taken together are designed to increase the security we offer to our customers and others who depend on us to protect their assets. Whilst the capital increase strengthens the bank's ability to grow the business and meet day-to-day risks, the Bankers Blanket Bond provides additional cover against unexpected events which could have a serious impact on our financial stability. The rapid evolution of the Cambodian economy as well as ACLEDA's own dramatic growth create their own pressures and in keeping with our 'risk averse' policy our Board of Directors determined to implement the same insurance cover normally taken out by the best banks in other parts of the world."

Mr. In Channy, President and CEO, noting that the bank now operates 156 offices nationally and plans to open 51 new outlets in 2007, added that "With ACLEDA constantly expanding and adding new products and services our business is becoming increasingly complex and it is important that both our customers and the bank itself should enjoy the best protection available for their assets. The doubling every year of our funds transfer business and the forthcoming launch of our ATM network to provide 24 hour banking 7 days a week in Phnom Penh and the provinces means that we must make every effort to ensure that all risks are covered. The over 140,000 customers who entrust us with their deposits, all of which are reinvested in Cambodia, have every right to expect the bank to take the best care of their money."

For more information contact:

Mrs. So Phonnary, Senior Vice President & Head of Marketing Division
E-mail:

Mr. Prom Visoth, Senior Vice President & Head of Legal Division
E-mail:

Definition of an agreement on the purchase insurance from Jardine Lloyd Thompson Asia and Asia Insurance (Cambodia) Plc. 

What are the qualifications of the ACLEDA Bank to receive an insurance package?

ACLEDA Bank has the leading and sufficient qualifications to receive the huge insurance. Those qualifications are:

1. Corporate Governance means the ACLEDA Bank has good performance with high responsibility, accountability, and transparency.
2. Community involvement means the ACLEDA Bank has participated directly in developing and promoting the standard of living of people in rural areas in 24 provinces/towns in Cambodia, no divers institutions can operate.
3. Environmental and Social Sustainability means the ACLEDA Bank has taken part in strengthen the social and environmental sustainability by carrying out the special policies to avoid providing loans to business, which is harmful to social environment in accordance with the provisions, prohibited internationally.
4. Commercial Success means the ACLEDA Bank is a successful institution, which has gradually increased the income since the beginning, especially, it has provided dividend to all shareholders.
5. Business Rating: ACLEDA Bank has received good rating from Moody's Investors Service – a world class rating analyst.
6. IT System: ACLEDA Bank has a world class banking technology cover in 24 provinces/towns in Cambodia.
7. Compliance: ACLEDA Bank's operations in accordance with local and international norms and regulations completely.

What is the Jardine Lloyd Thompson Asia insurance?

Jardine Lloyd Thompson Asia is a leading supplier of insurance and risk management services and the largest United Kingdom insurance broker listed on the London Stock Exchange.

Jardine Lloyd Thompson Asia insurance is the intermediary who has a lot of experience, employs more than 500 staff in Asia and covering the insurance in China, Hong Kong, Indonesia, Japan, Korea, Malaysia, Philippine, Singapore, Taiwan, Thailand, and Vietnam.

Jadine Lloyd Thompson Asia insurance is a member of Jardin Lloyd Thompson Group that operates insurance in 30 countries and has more than 5,000 staff.

What types of insurance that ACLEDA Bank receives from Jardin Lloyd Thompson?

There are 3 types:

1. Bankers Blanket Bond
2. Electronic and Computer Crime Insurance
3. Directors & Officers Liabilities and Company Reimbursement Insurance

Bankers Blanket Bond 

1. Infidelity of Employees
   Loss resulting solely and directly from dishonest or fraudulent acts by Employees of the Assured committed with the manifest intent to cause the Assured to sustain such loss or to obtain a financial gain for themselves whenever committed and whether committed alone or in collusion with others, including loss of Property through any such acts by Employees.


2. On Premises
   Loss of property resulting directly from theft, larceny, false pretences, burglary, robbery or hold-up committed by persons physically present on the premises where the property is located, or mysterious unexplainable disappearance, or being damaged, destroyed or misplaced howsoever or by whomsoever caused, while such Property is within any of the Assured's premises or actually within any recognised place of safe deposit within the United Kingdom or is actually within the premises or any of the Assured's correspondent banks or is actually within the premises of any transfer or registration agent for the purpose of exchange, conversion, registration or transfer in the usual course of business.


3. In Transit
   Loss of Property from any cause while the Property is in transit anywhere in the custody of an Employee of the Assured or any person designated by the Assured to act as its messenger or while in the custody of any Security or Armoured Motor Vehicle Company for the purpose of transportation on behalf of the Assured such transit to begin immediately upon receipt of such Property by the transporting person or persons and to end immediately upon delivery to the designated recipient or its agent.


4. Forgery or Alteration
   Loss resulting directly from:
   1. Forgery or Fraudulent Alteration of, on, or in any checks, bills of exchange, acceptances, drafts, certificates of deposit, letters of credit, withdrawal receipts for the withdrawal of funds, money order, orders upon public treasuries; or
   2. Having transferred, paid or delivered any funds or property or established any credit or given any value on the faith of any telegraphic, cable, or teletype instructions directed to the Assured authorising or acknowledging the transfer, payment, delivery or receipt of funds or property which instructions purport to have been sent by a customer of the Assured or by any banking institution but which instructions were sent by a person other than the said customer or banking institution purporting to send such instructions (which purported instructions shall be deemed to bear a forged signature) or have been altered without the knowledge and consent of such customer or banking institution.
   3. The payment of the Assured of forged or fraudulently altered promissory notes or of promissory notes bearing forged endorsements.
   
   The foregoing instruments must be in a script with which the Employee, acting upon such instrument, is conversant. Mechanically reproduced facsimile signatures shall be treated the same as handwritten signatures.


5. Securities
   Loss resulting directly from the Assured having, in good faith and in the ordinary course of business, acted upon any original:
   1. Share certificates, bearer stock, certificates of stock, warrants or rights to subscribe, allotment letters, bonds, debentures or coupons issued by limited companies or corporations; or
   2. Bonds similar in form to corporate bonds issued by partnerships which are secured by mortgages, deeds of trust or collateral trust agreements; or
   3. Cambodia Government and Cambodia Government Guaranteed and Cambodia Local Authority stocks, certificates of indebtedness, bonds, coupons or warrants issued by the government of any country or by any of its respective agencies, states, provinces, countries, cities, towns or municipalities; or
   4. Promissory notes except (i) those issued or purporting to have been issued for use as currency, (ii) those secured or purporting to be secured directly or indirectly by assigned accounts or what purport to be assigned accounts and (iii) those covered under Insuring Clause 4(c).
   5. Deeds of trust, mortgages upon real property and upon interests in real property and assignments of such mortgages.
   6. Certificates of deposit and letters of credit except when covered under Insuring Clause 4(a) and bills of lading subject always to General Definitions.
   
   which prove to have been (i) counterfeited, or (ii) forged as to the signature of any maker, drawer, issuer, endorser, assignor, lessee, transfer agent or registrar, acceptor, surety or guarantor, or (iii) fraudulently altered, or (iv) lost or stolen.


6. Counterfeit Currency
   Loss by reason of the receipt by the Assured in good faith of any counterfeited or altered paper currency or coin issued or purporting to have been issued.
   1. by the Bank of England, the Dominion of Canada, the United States of America and any Western European country; or
   2. by any country in which the Assured's office sustaining the loss is located.


7. Offices and Contents
   Loss of or damage to
   1. furnishings, fixtures, equipment (except computer, computer systems, computer networks and peripheral equipment, computer programs and other computer related equipment), stationery, supplies or safes and vaults within any office of the Assured, caused by burglary, robbery, hold-up, theft or larceny, or any attempt thereat, or by vandalism or malicious mischief,
   2. any office of the Assured caused by burglary, robbery, hold-up, theft or larceny, or any attempt thereat, or to the interior of any such office by vandalism or malicious mischief,
   
   provided that
   1. the Assured is the owner of such furnishing, fixtures, equipment, stationery, supplies or safes and vaults or offices or is liable for such loss of damage; and
   2. the loss or damage is not caused by fire.

Electronic and Computer Crime Insurance 

1. Computer Systems
   By reason of the Assured having transferred, paid or delivered any funds or property, established any credit, debited any account or given any value as the direct result of
   1. the fraudulent input of Electronic Data directly into: the Assured's Computer System; or a Service Bureau's Computer System; or an Electronic Funds Transfer System; or a Customer Communication System; or
   2. the fraudulent modification or the fraudulent destruction of Electronic Data stored within or being run within any of the above systems or during electronic transmission through data communication lines including satellite links to the Assured's Computer System or a Service Bureau's Computer System
   
   which fraudulent acts were committed by a person who intended to cause the Assured to sustain a loss or to obtain financial gain for himself or any other person.


2. Assured's Service Bureau Operations
   By reason of a customer of the Assured having transferred, paid or delivered any funds or property, established any credit, debited any account or given any value as the direct result of the fraudulent input, the fraudulent modification or the fraudulent destruction of Electronic Data stored within or being run within the Assured's Computer System or during electronic transmission through data communication lines including satellite links from the Assured's Computer System into the customer's Computer System while the Assured is acting as a Service Bureau for said customer which fraudulent acts were committed by a person who intended to cause the Assured or the Assured's customer to sustain a loss or to obtain financial gain for himself or any other person and for which loss the Assured is held to be legally liable.


3. Electronic Computer Instructions
   By reason of the Assured having transferred paid or delivered any funds or property, established any credit, debited any account or given any value as the direct result of the fraudulent preparation or the fraudulent modification of Electronic Computer Instructions which fraudulent acts were committed by a person who intended to cause the Assured to sustain a loss or to obtain financial gain for himself or any other person.


4. Electronic Data Media
   1. By reason of the loss of the Assured's Electronic Data as the result of the malicious destruction or attempt thereat of such Electronic Data by any person while the Electronic Data are stored within the Assured's Computer System.
   2. By reason of Electronic Data Processing Media being lost, damaged or destroyed as the direct result of robbery, burglary, larceny, theft, misplacement or mysterious unexplainable disappearance while the Electronic Data Processing Media is lodged or deposited within offices or premises located anywhere.


5. Computer Virus
   By reason of the Assured having transferred, paid or delivered any funds or property, established any credit, debited any account or given any value as the direct result of the destruction or attempt thereat of the Assured's Electronic Data due to a Computer Virus caused by any person while such Electronic Data are stored within the Assured's Computer System or a Service Bureau's Computer System.


6. Electronic Communication
   By reason of the Assured having transferred, paid or delivered any funds or property, established any credit, debited any account or given any value on the faith or any electronic communications directed to the Assured authorising or acknowledging the transfer, payment, delivery or receipt of funds or property which communications were transmitted or appear to have been transmitted through an Electronic Communication System, or by Tested telex, Tested TWX or similar means of Tested communication.


7. Electronic Transmissions
   By reason of a customer of the Assured, an Automated Clearing House or a financial institution having transferred, paid or delivered any funds or property, established any credit, debited any account or given any value on the faith of any electronic communications purporting to have been directed by the Assured to its customer, an Automated Clearing House or a financial institution authorising or acknowledging the transfer, payment, delivery or receipt of funds or property which communications were transmitted or appear to have been transmitted through an Electronic Communication System, or by Tested telex, Tested TWX or similar means of Tested communication.


8. Electronic Security
   By reason of a Central Depository having transferred, paid or delivered any funds or property or debited any account of the Assured on the faith of any electronic communications purporting to have been directed by the Assured to the Central Depositary Authorising the transfer, payment or delivery of said funds or property or the debiting of the Assured's account in connection with the purchase, sale, transfer or pledge of an Electronic Security which communications were transmitted or appear to have been transmitted through an Electronic Communication System, or by Tested telex, Tested TWX or similar means of Tested communication.


9. Forged Telefacsimile
   By reason of the Assured having transferred, paid or delivered any funds or property, established any credit, debited any account or given any value on the faith of any Tested instructions directed to the Assured authorising, or acknowledging, the transfer, payment, delivery or receipt to funds or property which Tested instructions were transmitted by Telefacimile directly to the Assured and fraudulently purport to have been sent by a customer, an officer of the Assured or another financial institution, but which Tested instructions were sent without the knowledge or consent of said person and bear a Forged Signature.


10. Voice Initiated Transfers
    By reason of the Assured having transferred any funds on the faith of any voice initiated funds transfer instructions directed to the Assured authorising the transfer of funds in a Customer's account to other banks for the credit to persons designated by the Customer and which instructions were made over the telephone.

Directors & Officers Liabilities and Company Reimbursement Insurance 

1. Insurance Cover
   1. Directors and Officers Liability
      The Insurer shall pay the Loss of each Insured resulting from any Claim first made against the Insured during the Policy Period for any Wrongful Act in the Insured's capacity as a Director, Officer or employee of the Company except for and to the extent that the Company has indemnified the Insured.
   2. Corporate Reimbursement
      The Insurer shall pay the Loss of the Company resulting from any Claim first made against the Insured during the Policy Period for any Wrongful Act in the Insured's capacity as a Director, Officer or employee of the Company but only when and to the extent that the Company has indemnified the Insured for the Loss.


2. Extensions
   1. New Subsidiaries: Total gross assets which are less than USD5,000,000 of the Schedule either in the United States of America or Canada; and does not have a listing of any of its Securities on any exchange in the United States of America or Canada.
   2. Outside Directorships: Cover includes Loss arising from any Claim made against any Insured who was, is or may become, at the specific request of the Company, a director or officer of any Outside Entity for any Wrongful Act in the Insured's capacity as a director or officer of the Outside Entity.
   3. Discovery Period: means the period of time immediately following the termination of this policy during which written notice may be given to the Insurer of any Claim first made against the Insured during such period of time for any Wrongful Act occurring prior to the end of the Policy Period and otherwise covered by this policy. If the Policyholder refuses to renew this policy, then the Policyholder shall have the right, upon payment of an additional premium, to a Discovery Period of 12 months following the effective date of non-renewal. The Insured shall be entitled to a 30 day Discovery Period at no additional premium if this policy is not renewed by either the Policyholder or the Insurer. The Policyholder shall have the right within 30 days of the end of the Policy Period to request an offer from the Insurer of a Discovery Period for up to 72 months. The Insurer shall offer a Discovery Period with terms, conditions and premium as the Insurer may reasonably decide.
   4. Heirs, Estates and Legal Representatives: If an Insured dies, becomes incompetent, insolvent or bankrupt, this policy shall cover Loss arising from any Claim made against the estate, heirs, or legal representatives of the Insured for any Wrongful Act of such Insured.
   5. Joint Property Liability: This policy shall cover Loss arising from any Claim made against the lawful spouse (whether that status is derived by reason of the statutory law, common law or otherwise of any applicable jurisdiction in the world) of an Insured for any Claim arising out of his or her status as the spouse of an Insured including any Claim that seeks damages recoverable from marital community property or property jointly held by the Insured and the spouse, provided, however, that this extension shall not afford cover for any Claim for any Wrongful Act of the spouse and that this policy shall apply only to Wrongful Act(s) of an Insured.