The National Bank of Canada is considering various options for its Cambodian unit, including the potential sale of ABA Bank, which could fetch a valuation exceeding US$2 billion in a prospective deal, sources familiar with the matter revealed.
Reports suggest that the Montreal-based bank has initiated preliminary discussions with advisors regarding a strategic assessment of one of Cambodia’s major financial institutions, although these deliberations remain confidential at this stage, as the process unfolds behind closed doors. Alongside a potential sale of the entire stake in ABA Bank, other alternatives being explored include the divestment of minority or majority interests, insiders noted.
However, it’s important to note that these deliberations are in their early phases, and the National Bank of Canada might ultimately opt against pursuing any transaction, according to individuals close to the matter. While approached for comment, a spokesperson for the National Bank of Canada declined to provide any insights, and ABA Bank has yet to respond to requests for comment.
Established in 1996 and previously known as Advanced Bank of Asia Ltd., ABA Bank stood as Cambodia’s leading commercial bank in terms of assets and deposits in 2022, as indicated on its official website. With a network encompassing 94 branches and over 1,600 self-service banking machines, the institution has solidified its position in the Cambodian financial landscape.
National Bank of Canada initially invested in ABA Bank back in 2014, commencing with a 10% ownership stake as part of its strategic agenda for global expansion. Subsequently, it bolstered its holding to 42% in 2015 and further to 90% in 2016. In 2019, the Canadian entity augmented its interest to 100% with an additional injection of US$63 million, according to a press release issued that year. Cumulatively, National Bank of Canada’s investment in ABA Bank amounts to US$320 million.
According to the annual report of the National Bank of Canada, ABA Bank recorded a net income of $343 million in 2023. Founded in 1859 by a consortium of businessmen in Quebec City, the National Bank of Canada has evolved into the sixth-largest lender in the country, as stated on its official website. Over the past year, its shares have appreciated by approximately 12%, thereby valuing the institution at US$28 billion.