Non-paper - 29 June 2017 - Myanmar's banking sector

The financial system plays a significant role in the development of a country’s economy. It also contributes towards a large number of employment, and provides necessary funds to various economic agents to enjoy sustainable economic growth.

Since the political reforms of 2011, the Banks and Financial Institutions Law of Myanmar has been passed by Parliament in 2016. In the past, the Financial Institutions Law of Myanmar, which was enacted in 1990, only provided very general rules for local financial institutions. However, the new rules include a wide range of guidelines on commercial banks,          state-owned banks, private enterprises, and foreign banks. The new law stipulates a minimum capital requirement of 20 billion Kyat, and also states that the lender needs to keep 5 percent of customer deposits as cash with the Central Bank.

Compared to other ASEAN member states, the contribution of Myanmar’s banking sector to the country’s economy is limited. Myanmar has the lowest banking assets-to-GDP ratio in ASEAN. However, the banking asset growth rate is 18% which is the fastest growth rate in the region. Since 2013, banks and other financial service providers have been expending non-cash payment system in the country.

For further information, please click: Non-paper - 29 June 2017 - Myanmar's banking sector.pdf

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