ANNUALREPORT

2022© JC FINANCE PLC. 2023

TABLE OF
CONTENTS
3

KEY FINANCIAL RESULT

4FACING THE CLIMATE CHANGE

6SDGS AND GENDAR EQUALITY

8

FINANCIAL STATEMENT9MISSION AND RESPONSIBILITIES10ORGANIZATION CHART

11

CORPORATE PROFILEKEY FINANCIAL RESULT
2022(USD)

A message fromthe CEO

2022(‘000KHR)

2021(USD)

2021(‘000KHR)

Profit/Loss before tax(679,997)(2,779,147)

25,671

104,430

Income tax

-

-

-

-

Net profit/Loss(679,997)(2,779,147)

11,40046,376

Currency transaction differences-

237,932-(147,586)

Total comprehensive income(679,997)(2,541,215)

11,400(101,210)

NUMBER OF CUSTOMER

8,000

千

780
760
740
720
700
680
660
640

6,000

763
691

4,000

6,870
4,320

2,000
0

2021

2022

LOAN OUTSTANDING
BALANCEAMOUNT OFDISBURSEMENT

2021

9,000
8,800
8,600
8,400
8,200
8,000
7,800
7,600
7,400

2022

A Business Development Manager and Assistant Manager
had been appointed directly under the CEO to carry out theabove tasks and a Back Office Manager of theadministration department had been appointed so that I
could concentrate on sales and new business development.
As a result, we were able to strengthen our management
and assessment functions.
Ultimately, 2022 resulted in flat sales and an increase in thenumber of prolonged delinquent customers.
Serious delinquent customers were written off as a result ofstrict deliberations.

⚫ Strengthening the partnership with
RMA, which sells John Deere
agricultural machineries.
⚫ Expanding agricultural working
capital loan initiatives for farmers⚫ Strengthening the approach toexisting customers

8,871
7,916
2021

In 2022, under my leadership, thefollowing measures were implemented
aiming to increase new loan
disbursements.

2022⚫ Launch of business loans of morethan USD 100 000 to SMEs..

It had been a challenging year for our customers, and for us,
despite a year of high hopes for recovery from the COVID 19
pandemic. However, we were determined to pass the baton
to 2023, believing all that we had accomplished in the year
2022 was the seeds of the future, waiting to sprout rather
than being swept away by the flood.
We hope that JC FINANCE will continue to be the one andonly financial institution rooted in the lives of Cambodian
farmers.

Suguru Tomari2023 JuneFACING THE
CLIMATE CHANGE

Background of Climate change in Cambodia
The country is presently ranked 12thout of 181 countries in the Global
Climate Risk Index (over the period
1999–2018)112 and 17th out of 180
countries in the World Risk Index in
2019.113 In 2014, Standard & Poor’s
rated Cambodia’s economy as themost vulnerable to the effects ofclimate change worldwide. Similarly,
the Notre Dame Global Adaptation
Index presently assigns highvulnerability and low-readiness scores
to Cambodia.
In 2014, Cambodia’s domestic
vulnerability assessments indicatedthat 17.2% of Cambodia’s communes(279 communes) were rated highly
vulnerable and 31.5% (512communes) were categorized quite
vulnerable to multiple climate hazards.
Projections suggest that average
rainfall will increase and become moreconcentrated, causing dry periods
during the wet season and leading tomore flood events; mean temperatures
will rise, and drought periods will be
extended. A recent study reports that
10% of GDP could be lost by 2050
without adaptation to climate change.

There are two types of flooding in the
country.
First, floods resulting from overflows of
the Mekong River, its tributaries, andthe Tonle Sap Lake contribute to soil
sedimentation and fertility, but also
encroach on urban areas and seal soil.
Second, heavy rains in mountainous
areas can trigger flash floods intributaries of the Mekong River and in
streams. These floods can destroy
crops and infrastructure in and along
the tributaries of the Tonle Sap Lake.
In the absence of other supports,
unpaid work may be transferred toelder women in the family or to girls,
often with negative impact on theireducation.
The need to balance livelihoods with
unpaid responsibilities keeps many
women in vulnerable work, and is abarrier to women expanding
businesses, advancing in their careers,
or taking leadership roles.
Time poverty affects women’s healthand reduces opportunities for further
education, community involvement orleisure.

Think together
Source:CAMBODIA AGRICULTURE, NATURAL RESOURCES, AND RURAL
DEVELOPMENT SECTOR ASSESSMENT, STRATEGY, AND ROAD MAP (ASIAN
DEVELOPMENT BANK JULY 2021)

FACING THE
CLIMATE CHANGE

Major flooding in 2022
In response, we have taken thefollowing actions

Total 14 province affected by flood
disaster in 2022.
And the damage has been extensive,with long-term damage to agricultural
customers, particularly in Kampong
Thom, Battambang, Siam Reap,
Banteay Meanchey and Pursat aroundTonle Sap Lake in our operation area.

1. Rescheduled principal repayments
to affected borrowers
2. Rescheduling of interest payments
for affected borrowers
3. Reduction or exemption of latepayment charges

On 28 October, NBC quickly issued a
Directive to financial institutions in
response to flood damage.

Majority of our valued customers live inrural areas and are at risk from climatechange.
As a financial institution that walks
alongside them, we believe that theway to achieve true sustainability with
JCF and our stakeholders is to firstprovide the greatest possible
cooperation to help our customers
return to normal times, and then tackle
environmental issues through finance.
In the future, we will continue to work
not only on the quantity and quality ofaccess to finance, but also on various
measures to tackle environmental
challenges.

Reference Number: #B. 7-022-1014
Title: Continue to cooperate within theframework of consumer protection andcontinue to provide possible benefits toborrowers who have been affected by
the severe floods.

Stand together% of delay customer byflood disaster% of reschedule amount by
flood disaster

14%

17%

No

83%

86%

Yes

No

Amount of penalty on flood
disaster

Total amount (USD)

6,921

Yes

Background of Gender Gap in Cambodia
Cambodia is a party to all coreinternational human rights treaties
including the Convention on the
Elimination of all forms of Discrimination
against Women. However, work stillneeds to be done in Cambodia to achieve
gender equality.
Structural inequalities are apparent in thelabour-market, with women overrepresented in lower paid, less valued
positions and under-represented in moresenior and higher paying roles. And
although women are more than 40% of
waged workers in agriculture, they arealmost entirely absent from managerial or
professional roles (Gavalyugova &Cunningham, 2020).
The gender wage gap is also biggest in
male-dominated industries; in some

SDGS AND GENDAR
EQUALITY

industries the gap is small at the lowest
paid levels but tends to increase at higher
salary levels. Differences in education andexperience account for very little of thegender wage gap, with discrimination
being the main factor. Restrictive gendernorms are reflected in the vastly unequal
distribution of unpaid domestic and carework, with women doing, on average,
90% of that work. Carrying most of theunpaid care work also impacts women in
waged employment. For example,
women’s wages flatten after having achild, while men’s increase (Gavalyugova& Cunningham, 2020).
The Asia Foundation and partners (2021)
also found statistically significant
increases in the gender pay gap for
waged workers between January and
April 2020.

Take an action together

Source:Gender Equality Deep-Dive for Cambodia (2022 UNITED NATIONS CAMBODIA)
Global Gender Gap Report 2023 (2023 WORLD ECONOMIC FORUM)

SDGS AND GENDER
EQUALITY

Our action for Gender gap
The percentage of women employed in JCF
is approximately 37% at the end of 2022.
This is due to JCF's previous humanresources policy of not appointing womenas field officers. This policy has been set
up to protect employees from crime anddanger caused by the low status of womenin Cambodia.
Our company is proactive in theemployment of women on the Board of
Directors and has been designed withgender diversity in focus from the
beginning of the establishment. This is inrespect of Cambodia's policy initiatives toaddress this social issue, such as theestablishment of the Ministry of Women's
Affairs and the Women Entrepreneurs
Association. On the other hand, the designof the salary gap is a work in progress.
The deviation from the average salary of
all employees shows that men were 9.15%
higher and women -15.65% lower.
(FY2022 note average).

AV. SALARY BY GENDER (USD)

To face this situation, we have madesignificant improvements in the numberof women in management positions in
FY2022. From just 20% at the beginningof the year, the proportion rose to42.86%.
Creating equal employment conditions
and promotion opportunities for all
employees not only enhances thewellbeing of employees, but also createsa conscious and competent employmentof all genders in the country with a highturnover rate.
Although the percentage of womenamong JCF's clients is still not large, we
believe that the next step is to link theseprinciples to our efforts in the provision offinancial services in the future.

NUMBER OF STAFF
FemaleNUMBER OF MANAGER BY GENDER

Male

38%

62%

Female
900
800
700
600
500
400
300
200
100
0

Male

Total average774.17652.98844.98

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

Male
FemaleIncreased in 2022

↑22.86%

FEMALE ON BOD
FemaleMale
25%

Jan-2280.00%
20.00%

Dec-2257.14%
42.86%

75%

FINANCIAL STATEMENT
Balance Sheet

2022(‘000KHR)

2022(USD)ASSETSCash and cash equivalents
521,432
Statutory deposits
2,534,972
Loans and Advance to Customers
7,272,671
Other Assets
55,676
Property and Equipment
34,072Intangible Asset
89,251
Total Assets
10,508,074
LIABILITIES AND SHAREHOLDER’S EQUITY
LIABILITIES
Borrowings
Amount due to related party
Other Liabilities
Income tax payable
Total Liabilities
SHARE HOLDERS’ EQUITY
Share Capital
Regulatory Reserve
Accumulated Losses
Currency Translation Reserves
Total Shareholders' equity
Total Liabilities andShareholders' equity
Profit and Loss

Share capital2021(‘000KHR)

2021(USD)

2,146,736
10,436,480
29,941,587
229,218
140,274
367,446
43,261,741

217,592
1,734,127
8,698,219
44,631
15,20926,141
10,735,919

886,470
7,064,833
35,436,544
181,828
61,961
106,498
43,738,134

4,095,304
2,500,000
77,069974
6,673,347

16,860,367
10,292,500
317,293
4,010
27,474,170

4,949,568
4,250,000
20,331
1,296
9,221,195

20,164,540
17,314,500
82,8285,280
37,567,148

5,000,000(1,165,273)
3,834,727

20,157,800(4,739,169)
368,940
15,787,571

2,000,000
79,964(565,240)
1,514,724

8,000,000
323,288(2,283,310)
131,008
6,170,986

10,508,074

43,261,741

10,735,919

43,738,1342022(‘000KHR)

2022(USD)

On 12 April 2022, the Company requested to
the National Bank of Cambodia (“NBC”) to
increase the share capital from
US$2,000,000 to US$5,000,000. On 6 May
2022, the Company obtained approval fromthe NBC on this increase in share capital.
The amendment to the Memorandum andArticles of Incorporation (“M&AA”) was
endorsed by the Ministry of Commerce on 13
June 2022.
In the subsequent period, On 13 March 2023,
the Company obtained approval from theNBC on the increase the share capital from
US$5,000,000 to US$6,250,000. As the dateof this report, The amendment to theMemorandum and Articles of Incorporation(“M&AA”) still ongoing process.

2021(‘000KHR)

2021(USD)

Interest income

1,224,023

5,084,322

1,266,246

5,151,089

Interest expense(354,726)(1,449,765)(331,129)(1,347,033)

Other operation income

57,675

235,717

68,841

280,045

Admin expense(1,090,261)(4,455,897)(830,946)(3,380,288)

Loan Loss Provision(523,507)(2,139,573)(147,341)(599,383)

Profit/Loss before tax(679,997)(2,779,147)

25,671

104,430

Income tax

-

-

-

-

Net profit/Loss(679,997)(2,779,147)

11,40046,376

Currency transaction differences-

237,932-(147,586)

Total comprehensive income(679,997)(2,541,215)

11,400(101,210)

WE ARE A GROUP COMPANY OF PHALSMISSION AND RESPONSIBILITIESFOR CUSTOMERSVisionMission
JCF will contribute to thegrowth of Cambodianindustries through our financial
Visionplatform in order to enhance
the life of people.

JCF will aim to achieve rapid
growth of the people related to
JCF together, and to develop
leaders who will be
responsible for Cambodia’s
growth.

We are based on the principle ofcustomer-oriented operation(Fiduciary Duty) and aim to further
improve the quality of our financial
services by promise to ourcustomers and business partners
that we will
1. work for the benefit of thecustomer,
2. do our best with the expert
knowledge and insights, and3. eliminate conflicts of interest both
inside and outside the company.

FOR ENVIRONMENT

Value
Value
JCF will have the following 5 beliefs to achieve our mission and vision:
Value for Customer

Keep Challenging
One Goal

Absolute Integrity
Belief in Self and Brave

To maintain a sustainable naturalenvironment (EcoSystem),
we will
1. understand the principle of nature,
2. think about things fromprosperous coexistence, and3. not exploit more than necessary
from the natural environment
We promise the above to ourstakeholders and will make social
contributions in a fair manner.

ORGANIZATION CHART
Shareholders

The Board of Directors

Risk Management Committee

Nomination
andRemuneration
Nomination
andRemuneration
Committee
Committee

Audit Committee
CEO

CreditCommittee
CreditCommittee
Key Management Members
ComplianceInternal Audit

Legal &
Compliance

Audit

Back OfficeBusiness
CreditCollection

Loan
Admin

RecoveryNew
Business
Development

Finance &Account

IT

Human
Resource
GeneralAffairSales andMarketing

KEY MANAGEMENT MEMBERS

BOD MEMBERS

Back Office Manager

Chea Soline

Accounting Manager

Long Kimpheak

CEO / BOD

Suguru TOMARI

Business Development
ManagerPrum HulInternal Auditor
ManagerLus Soriya

Chairperson of BOD

Ikuo KIKUCHI

Collection Manager

Chea Vuthea

Compliance manager

Chea Pichsokthida

Independent Director

Taihei YAMADA

Credit Manager

Yong Youyorng

Independent Director

Yuko KATOGROWING
TOGETHER
WITH

CAMBODIACORPORATE PROFILE
Company Name

JC FINANCE PLC.

Business Category

Microfinance Institution

License Number

M.F-85

Establishment

January 17th, 2018

E-mailinfo@jcfinance.com.kh

Websitehttp://jcfinance.com.kh

Tel

855 (0)23 217 419

Headquarter

No.56, Street 310, Sangkat Boeung Keng Kang I, Khan
Boeung Keng Kang, Phnom Penh, Cambodia.

ANNUALREPORT

2022

JCF will be representing New Agricultural Finance