Myanmar gives operating license to 4 more Asian banks

Myanmar's military government expelled foreign banks off Myanmar's shores in 1962, at the outset of the revolution that led up to the 'Burma road to socialism'.

Even though 34 international banks had their representative offices in the country, but they had been prevented from opening any branches.

The banks were restricted to offering advice to the clients in Myanmar.

Post-2011, since the new quasi-civilian government took over, they had been trying to introduce landmark reforms to give the economy a boost.

Foreign involvement of the banks was intrinsic to reforming the out-of-date banking system in Myanmar.

Myanmar- Asia's second-poorest country hoped to invite foreign investment and the move to allow foreign banks to operate was aimed towards that end goal.

Myanmar's central bank declared that 9 foreign lenders were being given "preliminary approval" to operate in Myanmar for the first time in decades.

The nine overseas banks are all from the Asia-Pacific region included "Australia and New Zealand Banking Group (ANZ), banking giant Industrial and Commercial Bank of China ( ICBC), and Japan's Bank of Tokyo-Mitsubishi UFJ."

While Myanmar gave preliminary approvals, the Myanmar Central bank's Vice-Governor Set Aung told the parliament that a variety of restrictions to protect the interests of local banks would be put on the foreign banks.

The foreign banks were asked to hold a minimum $75 million, limited to opening one branch each and were not permitted into the retail banking sector.

4 Asian banks were given operating licenses by Myanmar in the 2nd round.

With this, the number of foreign banks permitted to conduct business in the previously isolated country comes to 13.

The permission gives the banks a year to prove that they can achieve business designs laid out in their application to Myanmar's administration before they will be given permanent licenses.