Myanmar’s central bank said 42 foreign financial institutions with representative offices there applied for its restricted banking licences.
The four largest Thai lenders by assets — Bangkok Bank (BBL), Krungthai Bank (KTB), Siam Commercial Bank (SCB) and Kasikornbank (KBank) — have a presence in the neighbouring country.
BBL, Thailand’s biggest bank by assets, has been offering financial services in Myanmar for 19 years, while KTB, SCB and KBank, which entered the market in the past couple years, have expressed interest in seeking operating licences from the Myanmar authority.
The restricted banking licence will be offered to five to 10 of the 42 foreign banks, said the Myanmar central bank, but the licensing process has not been disclosed.
Myanmar will require licensees to contribute know-how to develop the domestic banking industry. The licences are for corporate banking business only, with foreign banks limited to one branch operation.
Myanmar’s central bank requires a minimum paid-in capital of US$75 million for each selected foreign bank in accordance with the World Bank’s recommendation. The licensing result will be announced in September.
Kittiya Todhanakasem, a first senior executive vice-president of KTB, said the bank has submitted an expression of interest to apply for the restricted banking licence, and a full proposal to Myanmar’s central bank is the next step.
She said the limited number of licences would create fierce competition. KTB is keen to upgrade from a representative office to a service branch to capture greater business opportunities in Myanmar.
Kamalkant Agarwal, an adviser to the chairman of SCB’s executive committee, said the bank expects to make a full proposal to Myanmar’s central bank next month, saying it is confident in its readiness for business in the country.
Both Myanmar and Thai corporate clients are the bank’s focus in line with the licence regulations.
KBank president Teeranun Srihong said the bank is also preparing its proposal to apply for a restricted banking licence in Myanmar.
Thai Board of Investment data shows the outflow of Thai direct investment last year totalled $372 million, up 19% from 2012.
source: Bangkok Post