The Competitive Nature of ACLEDA Bank

I. Introduction

According to the 2012 annual report of ACLEDA Bank, ‘Cambodia's financial market with its liberal regulatory environment is highly competitive with more than 35 commercial and specialized banks. Amongst the commercial and specialized banks, ACLEDA Bank managed to maintain its position as a market leader in terms of assets, loans, deposits and profitability, as well as in the number of offices and ATMs throughout the country’ . Furthermore, ‘ACLEDA Bank Plc. network had 238 offices covering all provinces and cities in the Kingdom of Cambodia’ . Based on these data, ACLEDA Bank seems to be in a very competitive position. Furthermore in a country where financial infrastructure is less developed, ACLEDA Bank is able to take advantage of it because it has market dominant power.

According to the 2012 annual report of ACLEDA Bank, one of the strategies of ACLEDA Bank for 2013/2014 is ‘to increase investment in MIS and IT systems, and to develop and introduce electronic banking services, thus launching internet banking’

Therefore I will review whether it is desirable to launch an internet banking service considering the weight of ACLEDA Bank in the whole banking industry of Cambodia and the financial environment of Cambodia. First I will review the benefits and drawbacks of internet banking, and next I will use cost and benefit analysis and SWOT analysis to make a conclusion.

II. Benefits and drawbacks of internet banking

Internet banking has become a standard of monetary transactions for over the past decade. Internet banking gets popular due to the easy and fast way of checking customers’ account. However along with conveniences of internet banking, there are some drawbacks

A. Benefits of Internet Banking

There a...

... middle of paper ...

...king services, which means these banks can be threats to ACLEDA bank, since competition increase.

V. Conclusion.

Although the initial investment cost will be huge, ACLEDA bank as a leading bank in Cambodia should launch internet banking system as soon as possible in order to take advantages as the first Cambodian bank which establish internet banking. At first, the costs of internet banking will be greater than benefits, but in the long run; costs will reduce, and will bring greater benefits to ACLEDA bank. Internet banking system will attract many Cambodian customers, and as a result, ACLEDA bank will be able to keep its position as a market leader in Cambodia. However, ACLEDA bank should not satisfy with the current position as the market leader in Cambodia, but it should keep try hard and need to make another goal of being well-known globally.