No Change to Reserve Requirement

Cambodia has decided not to increase its reserve requirement for banks to tackle inflation, National Bank of Cambodia Director General and spokeswoman Nguon Sokha said yesterday…The Kingdom’s reserve-requirement rate for banks stands at 12 percent, meaning 12 percent of total deposits at banks must be set aside and not loaned out. Recent discussion raised the possibility of increasing the reserve requirement to 16 percent, a rate previously maintained in 2008. The NBC will, however, re-evaluate the issue if inflation increases beyond 10 percent, she said. Economists and bankers generally said they agreed with yesterday’s decision (May Kunmakara and Don Weinland, p 7).