Myanmar steps up oversight over share acquisitions by foreign banks

Foreign investors are allowed to acquire up to 35% stake in local firms.

Myanmar’s central bank is aiming to ramp up scrutiny over acquisitions of a 35% stake by foreign banks in local lenders, Aung Naing Oo, Director-General of Directorate of Investment and Company Administration was cited in Eleven Myanmar.

Also read: Myanmar grants license to 4 private banks

Foreign investors are mandated by the Myanmar Companies Act to acquire up to 35% stake in local firms.

International banks could only operate in Myanmar via joint venture agreements with local banks or assist foreign-invested companies. Such banks are also restricted to just one branch per bank and are mandated to invest a minimum paid-up capital of $75m.

Seven out of 13 operational foreign banks in the country have earlier been allowed to provide export financing services, according to ASEAN Briefing, which puts them at par with their local, state-owned counterparts.

However, foreign banks are still prohibited from providing basic retail banking transactions such as account openings, local money transfers, and loan extensions denominated in local currencies.

Photo from Michael Coghlan from Adelaide, Australia - Settling In, CC BY-SA 2.0

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