This article was added by the user . TheWorldNews is not responsible for the content of the platform.

Cambodia issues 1st gov't bond of 24.3 mln USD

PHNOM PENH, Sept. 7 (Xinhua) -- The National Bank of Cambodia (NBC), Cambodia's central bank, on Wednesday issued the first government bond of 100 billion riels (about 24.3 million U.S. dollars), aiming to raise funds for national development.

The bond is auctioned through the NBC's platform from 8 a.m. to 2 p.m. local time, the NBC said in a statement, adding that the face value per unit is worth 1 million riels (about 243 dollars).

The bond offers a fixed interest rate of 2 percent per annum, which would be paid every six months, the NBC said, adding that the tenor of the bond is one year.

The issuance is the first phase of the Cambodian government's plan to issue sovereign bonds worth a total of 300 million dollars, it said.

Kim Sophanita, director of the Market Operations Department at the Cambodia Securities Exchange (CSX), said the Cambodia capital market has moved to another stage of development with a more complete and adequate infrastructure.

"The government bond market is crucial and beneficial to every stakeholder," the official told Xinhua on Wednesday.

"It provides additional financing option to the government, additional investment options to institutional investors, additional financial instrument for effective monetary policy management, a benchmark for every financial product, and more," Sophanita added.

Investors in sovereign bonds will enjoy a 50-percent deduction of withholding tax on the interest earned from holding and trading the bonds, and tax exemption on capital gains from purchasing and trading the bonds for three years, according to the Ministry of Economy and Finance.

Deputy Prime Minister and Minister of Economy and Finance Aun Pornmoniroth said recently that sovereign bonds will allow the government to raise funds for socio-economic development projects.

He added that the bonds will serve as a new financial instrument for institutional investors such as banks, insurance companies, the National Social Security Fund and pension fund, among others.