On behalf of the Board of Directors and Shareholders of MAXIMA Microfinance Plc. I am pleased to present MAXIMA’s Annual Report and Audited Financial Statement for the year 2018. This report shows successful achievements in terms of operational and financial performance in 2018. MAXIMA hopes to continue on its path of providing sustainable financial performance by focusing on growing loan and excellent service to clients in a speedy and timely manner.

The Cambodian economy in 2018

Cambodia has been highly fruitful in attracting foreign direct investment (FDI), creating employment and alleviating poverty for millions of Cambodians. Overall, Economic growth of Cambodia has continued to remain strong, driven primarily by robust expansion in consumption and exports. The National Bank of Cambodia’s (NBC) 2018 annual report shows that the growth and modernization of the banking sector has continued to enhance financial inclusion in Cambodia, with 69% of adults currently using financial services. At the same time, the Client Protection Principle (CPP) and Financial Literacy are being carefully taken into account.

Unlike its 2017 performance, the global economy has continued to grow gradually, despite US-China trade war. The trend of economic growth is, however, not equally distributed to all regions. While the US economic growth is expected to continue to be higher than last year. The economic growth in the Europe, Britain, Canada and Japan are slowing down. Meanwhile, China has also experienced an economic slowdown. For Asia, overall, the economy continues to maintain high growth if compared to other regions and contributes to the global economic growth of around 60%. The continued inflow of Foreign Direct Investment, the high export growth, and the strength of domestic demand have contributed to the economic growth of 7.3% in 2018. This growth rate is high compared to the growth rate over the last six years and it is higher than the average growth rates of many developing countries in the region. In this situation, the use of the Khmer Riel has been enhanced, especially in terms of measures taken to attract the users of Khmer Riel and the supply of Khmer Riel in accordance with the economic needs.

Overall performance in 2018

​In 2018 the total loan portfolio of MAXIMA reached USD18,521,169.85, an increase of 22% from USD 15,131,512 in 2017. The active clients increased by 4% from 5,795 to 6,019. The current PAR≥30days is 0.51%, which is an improvement of 0.31% over the last year, which indicates a maintenance of strong loan. Even though the growth is still lower compared to industry standards, MAXIMA is considered as an efficient microfinance institution in the market and among good players in the entire sector.

Social performance management

The concept of the Management of its Social Performance was gradually introduced by Gojo & Company, Inc. To improve on its social dimensions, MAXIMA has been working on several aspects, especially on all aspects of social performance with greater emphasis on client protection. MAXIMA is aware of its shortcomings in crystalizing its social goals but is looking to improve upon it. Through the SPI4, we wish to know the shortcomings to improve and wish to take a proactive approach to give value to our clients. MAXIMA is fully committed to being client-centric by endorsing the Smart Campaign and fully implementing the Client Protection Principles (CPP). Through this commitment and effort, MAXIMA hopes to be CPP Certified by Smart Campaign in 2019.

Sustainability and going forward

We have learned a lot from the challenges of the past several years in order to keep MAXIMA as a strong and stable institution. MAXIMA is in good hands of the leadership of Mr. Pa Ponnak Rithy, CEO, who has a deep understand¬ing of banking with more than 20 years of experience across financial sectors. He is supported by management team and also is supported and advised by board of directors.​​ MAXIMA has continuously developed and strengthened its operations in the face of market movements and severe competition of larger players who expand their operation to leverage their scale. The board and shareholders are confident that MAXIMA’s management and staff​ will make MAXIMA continue its high level of performance for all stakeholders. In the coming year, MAXIMA intends to pursue healthy growth by maintaining client service quality. MAXIMA cares for its clients and regularly assess the level of satisfaction of the clients to improves its products and services. MAXIMA maintains the loan quality based on enhanced the risk management and pursue reasonable profit by operation excellence. MAXIMA will pursue the new opportunities in terms of business model and partnership so that we can achieve the long term sustainable growth.

Finally, I would like to extend my appreciation to MAXIMA’s management team as well as all staff for their efforts to ensure that MAXIMA continues to serve its clients in a sustainable and accountable manner. I also wish to thank Board of Directors who provide guidance and support to the management and keep MAXIMA’s focus on balanced financial and social sustainability. Once again, my thanks to all shareholders, funders, investors, partners and clients for all the confidence in the institution that would allow MAXIMA to continue its operation and expand its growth in the years ahead.

On behalf of the Board of Directors