September 6, 2012

Insurance urged for CSX listings

[PHNOM PENH POST]

The Ministry of Economy and Finance yesterday urged companies intending to list on the Cambodia Securities Exchange (CSX) to buy insurance to bolster public confidence.

Vice President Bo Chanpiro of the Financial Industry Department of the Ministry of Economy and Finance said the finance sector relies not only on the banks and the securities exchange, but also on the insurance industry.

“The insurance companies play a very important role in investor security at exchanges around the world and both sectors reply upon each other,” he said. “An insurance company cannot succeed without a securities exchange and a securities exchange has no full power to develop if it has no insurance presence,” he said.

CSX Committee Deputy Manager Sou Socheat said the Cambodia Security Exchange still faces hurdles.

“The CSX needs confidence. In fact, building confidence requires insurance but many insurance products are complex.”

Forte Insurance General Manager York Chamroeunreth said it was very important to build risk awareness for future companies. He said Forte Insurance had compensated many millions of dollars for staff mistakes that caused the company to lose benefits and income.

“This is a good chance to urge the financial industry market to move forward in progress and stability by depending upon insurance services, which are a key factor to insure public confidence in the steadiness of the Khmer financial industry.”

Phnom Penh Water Supply President Ros Kemleng, who represents the first and only company listed so far on the CSX, said PPWSC was working with insurance companies and studying the issues.

President of Kompong Soum Port Lo Kemchhun, a company he says intends to list on the CSX, said he was unaware of any requirement to purchase insurance prior to listing.

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