Central Bank to Grant Retail Banking Licenses to Foreign Banks

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Phyo Thu/MBT

Starting in 2020, the Central Bank of Myanmar (CBM) will issue licenses to allow overseas lenders to open a branch or a subsidiary in the country.

To secure a branch license to provide wholesale banking or enterprise banking services, an investment of up to $75 million and a $40 million deposit with the CBM are required. A $100 million investment is required to obtain a subsidiary license, which allows a foreign bank to provide both wholesale and retail banking services and set up 10 entities including branches and off-site ATMs. Licensing applications will be accepted from June 2020.

In addition, the Central Bank is laying down rules and procedures for allowing foreign banks to own 35 percent or more of shares in local banks.

Since October 2014, foreign banks have been allowed to provide wholesale banking services to foreign corporates, local and foreign financial institutions and local companies in partnership with local financial institutions. At the end of 2017, the CBM moved to further liberalize the financial services sector by permitting foreign banks to provide export/import banking services to local companies.

Currently, Myanmar has 13 foreign bank branches and 27 local banks with a total of over 1,800 branches.