Cambodia’s capital market stands at a pivotal moment as regulators move to broaden participation beyond a narrow base of listed firms. In its newly released 10-Year Strategic Plan for 2025-2035, the Securities and Exchange Regulator of Cambodia (SERC) has outlined an ambitious roadmap aimed at accelerating capital market development, with a particular focus on encouraging banks, financial institutions, and small and medium enterprises (SMEs) to list on the Cambodia Securities Exchange (CSX).
The push reflects a stark reality. More than a decade after the CSX began operations, only 12 companies are listed, an unusually small number for an economy of Cambodia’s size. Regulators now hope that tapping into the country’s vast financial sector and SME base can provide the scale and liquidity the market has long lacked.
Banks largely absent from equity markets
Cambodia’s banking and financial sector remains conspicuously underrepresented on the stock exchange. According to the National Bank of Cambodia’s 2024 annual report, the country has 3,651 registered financial entities, the majority of which are money changers and ancillary service providers. Within this system, 284 institutions qualify as banks and financial institutions, including commercial banks, specialised banks, microfinance institutions, and leasing companies.
Despite this scale, only ACLEDA Bank Plc has listed its shares on the CSX, doing so in 2020. Other major financial institutions, such as Hattha Bank, LOLC Cambodia, ABA Bank, Prasac Bank (KB-Prasac), and PPCBank, have instead turned to the bond market to raise capital, where disclosure requirements are perceived to be less onerous and issuance is more flexible.
This pattern highlights a core challenge for regulators: convincing banks that the benefits of equity listing — greater visibility, broader funding access, and improved governance, outweigh the costs of transparency and compliance.
SMEs large pool, limited market access
The SME sector presents an even larger untapped opportunity. In Cambodia, small enterprises are generally defined as having capital between $50,000 and $250,000, while medium enterprises have capital ranging from $250,000 to $500,000.
Data from the Ministry of Industry, Science, Technology and Innovation (MISTI) 2024 annual report show 3,035 registered small enterprises and 530 registered medium enterprises nationwide.
Yet SME participation in the capital market remains negligible, reflecting persistent barriers such as limited financial disclosure, weak corporate governance structures, and difficulties in meeting listing requirements.
Although numerous studies and government reports acknowledge that SMEs face constraints in accessing finance from both banks and external investors, the structural roots of these challenges remain insufficiently addressed.
Cautious optimism, uneven gains
Market indicators suggest tentative improvement. Entering 2026, the CSX Composite Index recorded moderate bullish momentum, rising 3.2 percent year-on-year from 409.87 in January 2025 to 423.16 in January 2026. Nevertheless, the index remains well below its historic peak of 869.16 in 2019, underscoring the depth of the market’s earlier slowdown.
Individual stock performance has been mixed, reflecting thin liquidity and company-specific fundamentals.
Strong gains in counters such as GTI, PAS, and PEPC contrasted with declines in others, illustrating the uneven nature of investor confidence in a relatively shallow market.
Rising risks, policy trade-offs
The strategy to expand listings comes amid growing financial risks. According to World Bank data cited in mid-2025 reports, Cambodia’s non-performing loan (NPL) ratio rose to approximately 8.3 percent in 2025, up from 7.4 percent in 2024, following years of rapid credit expansion from 2018 to 2019.
This raises questions about whether banks can demonstrate sufficiently strong balance sheets to meet listing standards. For SMEs, the challenge is even more acute, as many continue to struggle with basic access to bank financing, let alone the regulatory and disclosure demands of public markets.
A decisive decade ahead
Looking toward 2035, Cambodia faces a decisive window to reshape its capital market. Regulatory easing alone will not be enough; success will depend on improving financial transparency, strengthening corporate governance, and ensuring that capital market growth keeps pace with underlying financial risks.
For investors, the key question remains whether banks and SMEs will step onto the exchange in meaningful numbers. If they do, Cambodia’s stock market could move well beyond its current base of 12 listed companies, laying the foundation for a deeper, more resilient, and more dynamic capital market.
Source: Khmer Times