The Central Bank of Myanmar should cooperate more with local banks (people from private banking sector)

The Central Bank of Myanmar was formed to operate independently in accordance with the Central Bank Law enacted in 2013, however, people from the private banking sector are urging the Central Bank to cooperate more with local banks.

Banking societies in Myanmar have been critical of Central Bank’s attempts to reignite the economy, citing the ever-falling value of Kyat.

“The Central Bank cannot not work independently yet. However, it will work more independently in the future and it needs more skillful workers and experts to work for them,” U Soe Win, manager of Deloitte Touche Myanmar Vigour Advisory Ltd, said.

He said CBM needs to work with local banks so the smaller banks can have their concerns heard. With further cooperation, local banks can have more footing to fend off competition from foreign banks entering the country, he added.

U Zaw Win, assistant managing director of Global Treasure Bank, suggested the CBM should rely on advice from Asian Development Bank and the World Bank in order to better monitor local banking operations.

“Profit margins of the banks are decreasing as all local banks have to compete in services. The banks have decreased the transaction rates and have increased interest rates on saving accounts in order to compete with other banks,” U Zaw Win added.

“How freely local banks operate is dependent upon the policies of the Central Bank of Myanmar. According to 2013 the Central Bank Law, the Central Bank is an independent organization but we would like the Central Bank to cooperate with local banks,” U San Thein, senior national expert from German International Cooperation (GIZ) said.

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