By Juliet Shwe Gaung for DSA
The Central Bank of Myanmar has awarded preliminary operating licenses to four more foreign banks, all from Asia, – Bank for Investment and Development of Vietnam, State Bank of India, Taiwan’s Sun Commercial Bank and South Korea’s Shinhan Bank. With this move, the total number of foreign banks that are allowed to operate in the frontier market touches 13.
The bank received 13 applications for the second round of licence issuance of which eight were shortlisted in the earlier round in 2014. These include State Bank of India, State Bank of Mauritius, South Korea’s Kookmin Bank and Shinhan Bank, Taiwan’s Cathay United Bank, E.SUN Commercial Bank and First Commercial Bank, and Vietnam’s BIDV. The new applicants in this round were CTBC Bank, Mega International Commercial Bank, Taiwan Business Bank, Taiwan Cooperative Bank and Taiwan Shin Kong Commercial Bank.
In the second round of bank licence issuance, the four Asian banks were given a preliminary approval, and these banks now need to fulfill the commitments made in their application of the request for proposal. “The preliminary approval is valid for 12 months during which the successful applicants will have to fulfill commitments made in RFP (Application), take all necessary measures to ensure functional banking operation from day one of business and will have to comply with requirements laid down by the Central Bank of Myanmar. Upon fulfillment, the Central Bank of Myanmar will grant the final License to operate in Myanmar,” the Foreign Bank Licencing Committee said, in an announcement.
The four banks are among the thirteen banks that applied to the Central Bank of Myanmar to open a branch in the country. The banks will put a capital of at least $75 million as an investment, which was the same amount for the previously awarded banks. These banks already have a representative office in Myanmar. The Licensing committee said they look forward to the applicants’ continuous involvement in the financial sector and economic development of the country. The first batch of banks that were awarded licences around late 2014 include Bangkok Bank, Australia’s ANZ, Japan’s Bank of Tokyo-Mitsubishi UFJ, Mizuho Bank, Sumitomo Mitsui Bank Corporation, the Industrial and Commercial Bank of China, Malaysia’s Maybank and Singapore’s Oversas-Chinese Banking Corporation and United Overseas Bank.
Article first appeared in DealStreetAsia