Cathay United Bank to acquire Cambodian bank

Cathay United Bank will purchase 70 percent of the Cambodia-based Singapore Banking Corp. Ltd.

This wasannouncede by Cathay Financial Holding, the prinicpal of CUB, which intends to expedite its expansion in Southeast Asia.

Lee Wei-cheng, spokesperson with Cathay Financial, said details of the acquisition will be made public after it receives regulatory approval.

SBC was founded in 1993 and has six operational points in Cambodia. Acquiring a 70-percent stake will position Cathay United as SBC's biggest shareholder and mark its official entry into Cambodia.

Cathay United has been successful in Vietnam and earns about US$20 million annually through its subsidiary in the southeastern Asian nation. With incomes generated by Cathay United's own branch in Vietnam, earnings from the country are the highest among the bank's overseas operations.

Cambodia is now Cathay United's second most important overseas market, where the bank wants to replicate its success achieved in Vietnam and seize the business opportunities in a country that has gained increased attention from Taiwan financial firms.

The subsidiary set up by First Commercial Bank in Cambodia became profitable after just a year, the firm said. Mega Commercial Bank meanwhile spent US$50 million to set up a Phnom Penh branch last September.

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