Investors can now find up-to-date information on the issuance of subsequent tranches of the Kingdom’s inaugural sovereign bond on Cambodia Securities Exchange (CSX) sources.
The CSX revealed in an announcement that the sovereign bond, worth 1.2195 trillion riel (about $300 million), was “profile-listed” on the exchange on September 21.
This means that all pertinent information concerning upcoming tranches will be publicly available, although the general public will not be able to trade in the government debt security until it is “full-listed”, its CEO Hong Sok Hour explained to The Post the following day.
When asked for a more concrete date for the full-listing, he said: “We need a little more time to prepare and operate effectively before we can have sovereign bond trading start, in our state securities market.”
For reference, the “primary market” is the part of capital market where companies directly issue securities to investors. The “secondary market” is the segment where investors trade the securities bought on the primary market with each other, rather than with the issuing entity.
However, sovereign bonds are not provided through the normal market mechanisms, rather they are issued through the National Bank of Cambodia (NBC), which serves as an agent, Securities and Exchange Regulator of Cambodia (SERC) director-general Sou Socheat explained to The Post on September 22.
He noted that there is a policy document requiring relevant information to be compiled at the CSX for the sovereign bond to be profile-listed, adding that the bourse has all the information collected from the issuance of the first tranche, wherein buyers had to “register and store information”. Socheat said this would be the norm for the upcoming tranches.
On September 7, the sovereign bond’s 100 billion riel maiden tranche was issued by the government in single-price auction format, with the NBC as an agent.
The tranche was issued at par value of one million riel, carrying a fixed per-annum coupon rate of two per cent paid semi-annually and a tenor of one year.
An announcement of the results of the first auction revealed that eight institutions took part, and that the total bidding volume was 41,800 units and winning bid rate 2.2 per cent.
On September 19, The NBC said the second tranche, of 200 billion riel, was to be issued on September 21 at par value of one million riel, carrying a fixed per-annum coupon rate of 2.44 per cent paid semi-annually and a tenor of three years. The results of this issuance have not been made public as of press time.
Sok Hour previously explained that the approximately $300 million to be received from the bond is the maximum amount that the National Assembly has authorised for the government to raise on the securities market.