Law & Regulation
Law and Regulation
Myanmar: Local Banks Can Now Accept Foreign Equity Investments of up to 35%
29/01/2019
The Central Bank of Myanmar (CBM) issued Circular Letter 1/2019 on January 29, 2019, stating that domestic private banks will now be able to accept up to 35% equity investments from foreign banks and financial institutions. The Circular Letter comes into effect immediately. Domestic private banks that wish to accept foreign investments under the circular are required to submit a set of documents to the CBM, including a copy of the mutual agreement describing the equity investment ratio, the terms and conditions of the investment, and others.
Any such equity investment arrangement between a domestic private bank and the local branch or subsidiary of a foreign bank (that is permitted to carry out business in Myanmar’s banking sector), must also comply with the cross holding restrictions under Section 61 of the Financial Institutions Law of Myanmar (notwithstanding Section 62, which normally excludes foreign bank branches from those requirements).
If you have any questions about this issue, or about doing business in Myanmar in general, please contact our Myanmar office on myanmar@tilleke.com or +95 1 255208.