The Banking and Financial Development Committee of the Parliament will propose to the Central Bank of Myanmar to halt granting banking licences to foreign banks until a modern Financial Institutions Law is enacted, a member of the committee said.
“International financial laws have provision to deal with corruption in banks but Myanmar’s 1990 Financial Law doesn’t have such terms. We have to amend the current law or enact a new one to make way for provisions like this,” U Phyo Min Thein, who is also a Member of the Parliament, said.
The committee recently met with the foreign bank licence issuing committee and local bank representatives and decided to carry out further steps to having a modern law, he said.
According to recent reports, the government is expected to grant licences to as many as 10 foreign banks to carry out limited operations in Myanmar. There are 36 foreign banks who have opened their representative offices in Myanmar. The government may grant the licences by the end of September, a Reuters report said.
It is very difficult for the local banks to advise regarding foreign bank licences as no regulations have been issued by the Central Bank of Myanmar, said U Pe Myint, managing director of Cooperative Bank.