• Home
  • News
  • CBM letter confirms foreign banks may hold 35% equity in Myanmar banks

06 Feb 2019

CBM letter confirms foreign banks may hold 35% equity in Myanmar banks

Linkedin

On 29 January 2019, the Central Bank of Myanmar ("CBM") issued a letter (addressed to local private banks in Myanmar) confirming that foreign banks and foreign financial institutions may hold up to 35% equity investment in local private banks in Myanmar.

In order to seek the requisite approval from the CBM, the letter states that the local private bank must furnish the CBM with a copy of its agreement with the foreign bank or foreign lending institution together with details of the proposed local-foreign equity ratio following the investment, and any other documents as may be requested by CBM from time to time.

Where such equity investment into a local private bank is from a local branch or subsidiary of a foreign bank already permitted to undertake banking activities in Myanmar, the local private bank is obliged to comply with the cross holding provisions as contained in the Financial Institution Law 2016.

The CBM letter represents significant and much-awaited further progress in the path to liberalise the financial services industry in Myanmar, following shortly after the Ministry of Planning and Finance's announcement that Myanmar's insurance market is now opening up to foreign insurers, both in the life and non-life sectors.  The liberalisation in the banking sector is expected to generate considerable interest from foreign lenders looking to deploy much needed foreign capital into Myanmar's developing banking industry.

Should you wish to speak further on recent liberalisations in the banking and insurance sectors in Myanmar, please feel free to contact us.

Linkedin

KEY CONTACT

Tom Platts

Tom Platts
Partner

T:  +65 6622 9641 M:  +65 8233 3245 Email Tom | Vcard Office:  Jakarta, Singapore, Yangon

Ben Hickson

Ben Hickson
Senior associate

T:  +95 1 925 3746 M:  +95 92 5063 8046 Email Ben | Vcard Office:  Yangon

Su Wai Phyo

Su Wai Phyo
Associate

T:  +95 1 925 3745 M:  +95 94 2651 1210 Email Su Wai | Vcard Office:  Yangon

Helen Rhind-Hufnagel

Helen Rhind-Hufnagel
Of counsel

T:  +65 6622 9689 M:  Email Helen | Vcard Office:  Singapore, Yangon

  • Related Services
  • Related Locations