First Finance's CEO Message

We have successfully completed changes, demonstrated by the excellent results and earned the confidence of lenders, stakeholders, and regulators. In addition, we have further expanded credit services in affordable housing finance to low- and middle-income households in Cambodia.

Since my appointment as Chief Executive Officer in July 2022, I have been working steadily on business improvement strategies and plans for First Finance. The plans and strategies that have been executed will transform First Finance to becoming the best institution in the financial sector. From day one, we started to augment all aspects of First Finance to ensure good corporate governance, a strong corporate culture and credit discipline, with strong internal controls and risk management, good credit quality, low risk, high productivity and efficiency, and financial sustainability.

Importantly, First Finance will scale up and improve efficiency so that the company is well-positioned to deal with this difficult period. To mitigate the current challenges and guarantee strong financial performance for the coming years, we have implemented the following strategies: (i). Retained the current vision and mission by focusing on housing financing and expansion of credit services in affordable housing finance to low- and middle-income households in Cambodia, (ii). Increased registered capital to USD 15 million to increase confidence from the public and partners (iii). Borrowed subordinated debt to increase the CAR and use for lending, and seek funding from existing and new lenders, (iv). Improved the portfolio quality by improving lending policies, procedures, and processes, (v). Improved HR policy to retain and attract good and qualified staff, (vi). Improved/developed all policies and procedures, such as corporate governance, internal controls and risk management, strengthened internal controls and building risk management awareness, (vii). Improved efficiency by reducing cost-to-income by increasing productivity of Credit Officers and branches, (viii) Strengthened IT infrastructure and the core banking system, (ix). Continued to improve and strengthen client protection, ensuring access to client protection certification, and promoting Corporate Social Responsibility activities.

Our 2022 results demonstrate that these strategies continue to deliver success, and delivered against the challenges and changes, show how First Finance will continue to bring our strengths and best capacities in the coming years. We are continuing to build First Finance to be a low NPL company, have high staff productivity, effectively manage costs, hold strong client relationships, have prudent capital and risk management, and highly engaged staff. We are also building a strong culture, with integrity, trust, and ethical behavior in all of our business activities. We have a shared pride in our performance; a successful history, and our footprint is unique among our competitors, which will create long-term value for our lenders and stakeholders.

In 2022, First Finance started to grow and saw improvement in financial performance.

Executing a Focused and Consistent Strategy

Our strategy is focused and consistent. We are committed to delivering high-quality growth and long-term value for lenders and shareholders. The strategy is also built to deliver high quality assets and sustainable earnings growth. We will pursue opportunities that are aligned to our view of market trends, build on our strengths, and deliver long-term value to our stakeholders.

Ensuring Stable Operations and Moving Forward

Our efforts to stabilize and improve operations, build trust and confidence, and have a strong code of ethics and culture, will allow us to remain vigilant and continue to steadily move forward with our business improvement strategies and plans.

Leading through Confidence

While the economic slowdown, high global inflation and interest rates, regulatory changes, market volatility, and increasing competition will pose more challenges to our business operations, we also see opportunities. We’re committed to delivering the right strategy, strengthening our culture and staff capacity to drive continued growth, and taking advantage of changes in the marketplace. What these times have shown us is that our strategies are well functioning. We are more confident than ever that we chose the right strategies and have the right people to meet the challenges ahead. As we pursue responsible, sustainable growth, we strive to continue to earn the right to bring our clients and shareholders with us on this journey through these difficult times into the favorable future.

By executing our strategy well, and making meaningful progress against our focus priorities, First Finance will be in a good position to perform within the ranges of our medium-term performance objectives and create longer-term stakeholder value. We will always continue to maintain our efforts to achieve excellence through cooperation, commitment, and transparency in all our dealings.

On behalf of the First Finance Management, I would like to thank the management team and staff for their efforts and commitment, the Board of Directors for their support and advice, and the Royal Government of Cambodia, regulatory bodies, the National Bank of Cambodia, and local authorities, who always support us.