Nikkei Asian Review: “Japan wins big in Myanmar foreign bank licenses”

GWEN ROBINSON, Senior Asia editor | October 2, 2014

BANGKOK — Myanmar on Wednesday announced it had awarded banking licenses to nine foreign banks, including the three biggest Japanese banks and Australia & New Zealand Banking Group Limited.

The move follows more than five decades when the country was closed to foreign lenders, and marks a new phase in Myanmar’s re-engagement with the international community — although the licenses carry limitations on the initial scope of operations.

“Myanmar has given a significant nod to Japan in the hope of favoring much greater Japanese investment. Japan has been a large investor as Myanmar has opened its economy, but is still over-shadowed by [South] Korea, and by China and Thailand. The fact that Korean banks were shut out entirely is surprising given the size of Korea’s stake in the country,” said Vriens & Partners, a leading Yangon-based consultancy, in a client note.

In favoring Japanese banks, Myanmar has also “bet on size,” Vriens added. “The three winning Japanese banks are the largest lenders in Japan and are among the largest banks in the world. None of the large American, British, and European banks made bids, this time.”

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