The Central Bank of Myanmar (CBM) is encouraging private banks to be more active in foreign exchange business to develop the country’s financial market, an official said.
Vice Governor of the CBM Daw Khin Saw Oo told the parliament that private banks, which have authorised foreign exchange dealers licences, can lend foreign currency under law to those residing in the country.
She encouraged the private banks to increase their foreign exchange capital, accept savings made by depositors and borrow foreign currency from local and foreign financial markets.
She urged the private banks to keep enough foreign exchange saving at their banks for lending to ensure development of the financial market.
She disclosed that rules and regulations of Foreign Exchange Law will also be released soon for bankers to abide by.
Myanmar introduced a managed float in April 2012 after decades-long application of complex dual exchange rate.
To eliminate illegal foreign exchange trading, 14 private banks have been granted as authorised dealers from October 2011 to July 2013 to enable official trade of three kinds of foreign currencies – US dollar, Singapore dollar and the Euro – at a rate designated in line with daily exchange rate transacting in the international exchange market.
