Issue 59| 26 June 2019

NEWS
Myanmar Financial ANALYSIS
COMPANIES
Services Brief DATA

Part of the Myanmar Financial Services Monitor

finance.frontiermyanmar.com
IN THIS WEEK’S BRIEF

COMPANY OF  FRD aims to have foreign insurers, JVs start in tandem

THE WEEK
The regulator wants the five foreign life insurers - still to receive their full
Yoma becomes the licenses - to start operations at the same time as the new joint ventures
latest lender to hit the
savings rate floor  AEON Microfinance profits double
The city-based consumer goods-focussed microfinance lender has
reported doubling its profits for the latest financial year

 Mahar Bawga gets AGD loan

Asian Green Development Bank has made its first of several planned
loans to the micro-lending sector

 Nippon Life announces Grand Guardian stake

DEAL OF THE WEEK  Data analysis: World Bank on SME and real estate lending
 IKBZ pays out on destroyed government steel shipment
Grab has joined with the
state-insurer to cover  MTB to compete with lower charges
drivers and riders across  Myanma Insurance to cover Grab drivers and passengers
its growing business  Ongo, METRO partner for digital payments
 Yoma's saving rate down to the floor
 MMFA hoping more members join data sharing platform
DOWNLOAD THE
MYANMAR FINANCIAL  Myanmar Investments board, shareholders reject merger
SERVICES REPORT  Three regions lead MADB's JICA-funded loan borrowers
 Bank branch network round up, 25 June

DATA
 Selected local banks by saving deposit rates
 Local banks and insurers by branch network
Read FMR’s flagship  Licensed MFIs
report on the sector by
clicking here  Selected investment deals in Myanmar
 Foreign exchange rates
 YSX stock prices
Myanmar Financial Services Brief, 26 June 2019 2

Insurance "We gave them *the five applicants+ six

FRD aims to have foreign insurers, JVs start in months from the date they were announced as
tandem preferred applicants *5 April+ to complete
their pre-licensing conditions, during which
The five foreign life insurers that received “in- they have to look for offices and employees."
principle approval” to operate in Myanmar in
April are still in the “pre-licensing” stage, We note that at least four of the five - Chubb,
although they are all very likely to obtain full AIA, Dai-ichi and Manulife - have already
licenses, according to the Financial Regulatory registered as companies.
Department (FRD.)
It is unclear whether Prudential has also done
The regulator reports that the foreign life so. We highlighted last week that AIA
insurers are likely to be permitted to start announced a partnership with a local
operating at the same time as the foreign-local healthcare publishing platform and is hiring
joint ventures to promote fair competition. staff for various positions.

Following the finance ministry’s As all five are well known international firms,
announcement of the five foreign life insurers they were very likely to meet the necessary
in April, local and international media conditions and receive full licenses, U That Zin
portrayed the firms as having been awarded told MFSM, adding that the foreign firms were
full licenses. We noted at the time that the likely to get the green light to start operations
announcement was only one of “in-principle at the same time as the joint venture
approval”. applicants.

"We would like to see them all start

simultaneously, otherwise it would be unfair
competition,” he said.

The FRD is currently reviewing the JV

applications, and U Thant Zin said previously
that the successful applicants would be
announced: "on or before 31 July".

Microfinance
AEON Microfinance profits double
Myanmar Financial Services Monitor has since
spoken to the firms and received conflicting AEON Microfinance Myanmar posted a 206%
reports. One insurer reported this week it had increase in net profits for the financial year
already received a license to operate, while ending on 28 February 2019, according to
others said their understanding was that all reports from the firm's Thai parent.
five firms are still in the process of receiving a
formal license. AEON Myanmar is a subsidiary of Thailand-
based AEON Thana Sinsap, which said its
In a search for clarity, we spoke to Financial Myanmar subsidiary also saw 66% year-on-
Regulatory Department (FRD) director U Thant year growth in sales and 71% in revenues. The
Zin, who told Myanmar Financial Services ultimate parent company is the Tokyo-listed
Monitor on 25 June that the five preferred Japanese firm AEON Financial Service.
applicants are still in the “pre-licensing” stage.

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Myanmar Financial Services Brief, 26 June 2019 3

AEON Thana Sinsap previously reported that

AEON Myanmar’s revenues hit BHT159m and
its net profits totalled BHT9m ($292,306) for
the financial year ending 28 February 2018.

The Thai parent did not provide figures for

AEON Myanmar’s revenue or net profit for the
2019 financial year.

However, based on the percentage increase

figures from the parent company's report, we
estimate AEON Myanmar’s revenue at Yoma lends to micro lenders using a distinct
BHT259.17m ($8.4m) and net profits at structure as part of a LIFT-funded agribusiness
BHT18.54m ($602,151) for the financial year initiative: taking a borrower’s foreign currency
ending 28 February 2019. funding as collateral and lending up to 2.5
times the amount in local currency.
AEON Microfinance started its operations in
Myanmar back in 2013 and has two branches The joint MBF-AGD press release said that
in Yangon and one in Mandalay. The lender MBF will use the AGD funding to “speed up
provides micro-loans and installment financing expansion”. MBF opened a South Okklapa
for electronic devices. branch earlier this year and is now renovating
branches in two other Yangon townships.
The MFI has a total customer base of 150,000
and has plans to expand its branch network MBF said earlier this year that it planned to
and product suite. open four new branches in 2019.

Banking MBF started operations in 2014 and had more

Mahar Bawga gets AGD loan than 14,000 clients and an aggregate loan
book of Ks4.59bn as of February 2019. The
Asian Green Development has issued a NBFI offers automobile and mortgage
Ks1.4bn ($921,000) loan to Mahar Bawga collateralised lending along with leasing and
Finance (MBF), which tapped Yoma Bank for consumer finance products. Some 85% of the
Ks2.2bn in financing earlier this year. lender's loan book is consumer finance

Yoma Bank has become the pre-eminent In February, Mahar Bawga said it planned to
funder of micro lenders over the last year, and launch product financing "soon" with a target
MBF was its first loan to a finance company a Ks5bn-7bn in non-durable product financing
(NBFI). We have noted in the past that the only lending. The AGD-MBF press release said that
other local bank that we are aware has lent to MBF is about to launch "two new products
the microfinance (or NBFI) sector is AGD. widely", but did not elaborate.

Our understanding is that the MBF loan is The Myanmar Times reports that MBF is
AGD’s first loan to a micro lender in some planning to change into a public company in
time, but that it is planning other transactions order to list on the Yangon Stock Exchange
in the near future. The bank has not released (YSX), quoting MBF financial controller Daw
any details about the tenor, interest rate or Pan Pa Pa.
structure of its loan. We assume that the
financing is an uncollateralised loan at the new She said the firm has 17,000 borrowers and
16% interest rate cap. plans to double this number by 2020.

finance.frontiermyanmar.com
Myanmar Financial Services Brief, 26 June 2019 4

Insurance Both those partnerships are for general

Nippon Life announces Grand Guardian stake insurance.

Nippon Life Insurance has confirmed earlier Our table of all the joint venture applications is
reports that it intends to take a 35% stake in below:
local firm Grand Guardian Life insurance.
Local company Foreign partner Business
The firm said on 21 June that it had "submitted FNI Muang Thai Life Life
documents to Myanmar's financial authorities
GGI Nippon Life Life
for approval". Nippon Life said it will acquire a
35% stake in Grand Guardian's life business for Capital Life Taiyo Life Life
$21m. CB Insurance Thai Life Life
GWI DB Insurance General
Mitsui
IKBZ General
Sumitomo
Muang Thai
FNI General
Insurance
Sompo Japan
AMI General
Nipponkoa
Tokio Marine &
GGI Nichido Fire General
Insurance

Banking
Data analysis: World Bank on SME and real
In its announcement, Nippon Life gives the estate lending
equivalent figure in yen as Y23bn, but we note
that it has missed out a decimal point. The The World Bank recently published it's latest
equivalent amount in yen is approximately economic monitor, and we take the
Y2.3bn. opportunity to look at some of the data
relevant to the banking and financial sectors.
Nippon Life said that it expects to complete
the transaction between September and First off, the World Bank notes that credit
October this year. The new entity will be growth is still slowing following the 2017
named Grand Guardian Nippon Life prudential regulations.
Insurance.
Growth in credit to the private sector was 20%
Another Japanese firm, Tokio Marine & in the first quarter of the 2018-19 financial
Nichido Fire Insurance, intends to take a year (Q4 2018), down from 21% during the
maximum 35% stake in Grand Guardian previous quarter, according to the World
Insurance’s general insurance arm, according Bank’s report.
to media reports. That investment will be
“likely worth” about Y5bn ($44.7m), according We noted in a data analysis back in February
to the Nikkei Asian Review. that credit growth fell almost immediately
when the prudential regulations came into
Mitsui Sumitomo Insurance is planning a joint- force in the third quarter of the 2017 calendar
venture with IKBZ Insurance, and Sompo year.
Holdings plans to partner with AMI.

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Myanmar Financial Services Brief, 26 June 2019 5

The growth in credit to the private sector was

already falling slightly but steadily year-on-
year in the years before the regulation. But in
2017-18 - the old financial year that ended in
March 2018 - the fall was much larger.

We assume that the bank is looking at the year

-on-year percentage growth in "claims on the
private sector" published by the central bank.

That data, which the central bank used to call

credit to the private sector, does indicate that Source: Central Bank of Myanmar
growth was 21% during the previous quarter
although the central bank has not published We also note that looking at quarter-on-
the data for the first quarter of 2018-19 quarter growth shows a cyclical pattern across
(Q4 2018). the year, but also a downward trend over the
past several years even before the prudential
Combining the World Bank’s figure for Q1 regulation.
2018-19 with the central bank’s published data
gives the chart below showing year-on-year The graph below is from our earlier data
credit growth by calendar year quarter. We analysis. The latest figures for Q2 2018 and Q3
have used calendar year rather than financial 2018 are 3.6% and 6.8% respectively - showing
year because of the recent change in financial a continuation of the same cyclical pattern
year. across the year but with credit growth slower
than in the same quarters the previous year.

Source: Central Bank of Myanmar

Source: Central Bank of Myanmar
The drop in credit growth looks more stark on
a financial year basis, as we showed with the On a positive note, the World Bank points
graph below in our data analysis earlier this out that credit growth to SMEs is rising, albeit
year - the financial year-on-year growth from a small base. The year-on-year growth in
dropped from 33% to 23% between the end of SME credit was 80% in Q1 2018-19, according
2016-17 and 2017-18. to the World Bank.

We are unsure of what data the World Bank

looks at here, but the central bank does
publish data on commercial bank lending to
the SME sector.

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Myanmar Financial Services Brief, 26 June 2019 6

However, looking at the last few quarters of The chart below shows real estate and
available data it appears there is a potential construction loans by calendar year quarter as
mistake in the central bank figures. part of banks' total commercial loans.

The jump in commercial bank loans to SMEs We note that the central bank's definition of
between Q4 2017 and Q1 2018 is immense, commercial loan does not include consumer
and cannot be reconciled with the World lending, agriculture, hire purchase or
Bank's report that SME lending increased just mortgage lending.
80% between what would be Q4 2017 and
Q4 2018. Still, it looks as though loans to the
SME sector are will now be north of Ks1trn and
rising quickly.

Source: Central Bank of Myanmar

The World Bank report is looking at the change

in growth between Q4 of the financial
The World Bank also notes that “easing of transition year and Q1 2018-19 of the new
credit conditions for housing” may have financial year, which equate to Q3 and Q4 of
helped the real estate sector. the 2018 calendar year.

The report states that banking sector credit to The bank is right that between those two
the real estate sector grew by 200% year-on- quarters in 2017 there was negative credit
year in Q1 2018-19, following negative growth growth, although Q3 2017 seems to be a
in the same period the previous year. slightly usual quarter in general.

Again, the central bank has not published the Credit veered between positive and negative
data for that quarter, but we can look at what growth across quarters in 2017 for commercial
has happened to credit to the real estate and loans in general, not just
construction sectors over the previous real estate/construction.
quarters.
Between Q3 2017 and Q1 2018 there was a
The central bank publishes data showing the marked recovery in commercial lending but
loans to "real estate and construction" on local not in real estate/construction loans, which
commercial bank balance sheets. became a much smaller percentage of total
commercial loans throughout 2018.
Data is also available separately for the foreign
banks, but in terms of volume their lending is If we apply the World Bank's reported 200%
completely dwarfed by the local banks. increase to the Ks2.4trn in real estate/
construction lending in Q3 2018 then the
figure for Q4 2018 (Q1 2018-19) would be
Ks7.2trn - a huge increase.

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Myanmar Financial Services Brief, 26 June 2019 7

There is no way that commercial lending could IKBZ held a ceremony on 18 June at which it
increase by anything like that amount, and so made a payment of Ks491m. The backdrop of
it seems likely that real estate/construction the signing stage reads that the payment is "ex
lending is once again becoming a larger gratia" - meaning that the insurer is not in fact
proportion of commercial bank lending. obligated to make the payment under the
terms of the policy.
Insurance
IKBZ pays out on destroyed government steel Local media, however, were unanimous in
shipment describing the payment as "compensation".

IKBZ Insurance has made an ex gratia It is possible that the terms of the contact did
insurance payment of Ks491m ($320,915) to not strictly cover the damage to the goods, but
the Ministry of Construction for a construction the insurer decided to make a partial payment
material shipment destroyed by the Arakan as a good will gesture. Unfortunately, we were
Army (AA). unable to clarify the issue with IKBZ.

In March this year, the MV Yadanarwin was We note that IKBZ Insurance paid over Ks3.9m
transporting steel arch trusses and ($2,500) in compensation on an inland cargo
other bridge construction supplies from insurance policy on 26 February - the first
Yangon to Chin state's Paletwa township. compensation paid out on that form of
insurance in Myanmar.

That compensation was paid to the Myanmar

Watermelon and Muskmelon Growers and
Exporters Association after a member's truck
transporting 17 tons of watermelons crashed
near Gotwin Valley in Shan State's Naungkhio
Township on 26 January.

Banking
MTB to compete with lower charges
The total weight of the shipment was 286
tonnes and the ministry insured the shipment The country's newest lender, Myanma Tourism
for Ks1trn, paying a total premium of Ks4.1m, Bank (MTB), is to differentiate itself by
which included Ks1m for damage due to charging lowering transactions fees than other
conflict or war. banks, its managing director Saw Bo Bo
told Business News TV.
Myanmar Financial Services Monitor notes
that the policy is described as covering "total He said the use of modern banking technology
loss only", which we understand to mean that by retail customers is still low in Myanmar,
the insurer is only obligated to pay out if the compared to other countries, and local banks
goods are lost in their entirety. charge higher transaction fees than overseas
banks.
We understand that an AA attack damaged the
goods to the extent that they could not be "We are working to apply lower transaction
used in bridge construction. charges as a differentiation point", said
Saw Bo Bo.

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Myanmar Financial Services Brief, 26 June 2019 8

Additionally, the lender aims to provide Insurance

customised credit facilities, in addition to Myanma Insurance to cover Grab drivers and
traditional loan products such as overdraft and passengers
term loans.
Ride hailing platform Grab has partnered with
Plans are also underway for MTB to buy OPTX, state-owned Myanma Insurance to provide
which is the latest version of Oracle group personal accident insurance for its
and includes analytical and forecasting drivers and passengers.
modules for corporate clients, to improve its
cash management services. The scheme covers drivers and passengers on
the GrabTaxi, GrabThoneBane and GrabBike
platforms in Yangon, Mandalay and Bagan.
They will receive compensation in the event of
accidental death, permanent disability or
bodily injury.

Grab said, "This *insurance+ coverage includes

total personal accident benefits for the driver
or passenger of up to $7,500 per person,
subject to aggregate limits including $10
million per accident in Myanmar. Each incident
will be evaluated individually by Myanma
Last but not least, the bank will also compete Insurance."
with other lenders on better customer
services, as it has a focus on the hotel and For any claims made by drivers or passengers,
tourism industry, which is mainly Grab will file the necessary documents on
service-oriented, said Saw Bo Bo. behalf of the victims and submit them to
Myanma Insurance and Chubb for review and
He said, "We will create a hotel-like processing. Grab will disburse any
environment where customers feel physically compensation approved by Myanma Insurance
and mentally pleasant when they come into and Chubb.
our bank, and we will fulfil *their needs+ with
best banking services." The ride-hailing firm is also facilitating the
transfer of knowledge and expertise from its
Saw Bo Bo added that about 20% of the global insurance partner Chubb's to Myanma
bank's current loan portfolio is in the tourism Insurance.
industry and that two additional branches in
Naypyitaw and Mandalay are ready to open. The US-headquartered insurer Chubb is one of
Muse and Myawaddy branches will also be five international firms to receive a life
launched soon, and the lender plans to hit ten insurance license in Myanmar.
branches by this year.
Grab's country head Cindy Toh said in June
MTB said recently that it plans to end 30% of that daily bookings had risen by 30% over the
its total loan portfolio to borrowers in the last 12 months. The use of GrabPay was up
hotels and tourism industry. The bank 10% over the same time period, she said. Grab
launched a “Travelling Loan Special Service has a partnership with CB Bank in Myanmar,
Programme and Interest Rate of Bank Deposit” which allows drivers to cash out their GrabPay
in cooperation with the Myanmar Tourism wallets at the bank's ATMs.
Entrepreneurs Association earlier this month.

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Myanmar Financial Services Brief, 26 June 2019 9

Mobile Money
Ongo, METRO partner for digital payments

B2B focused firm Ongo is to provide digital

payment services to the customers of METRO
Wholesale Myanmar.

The partnership enables Metro customers to

make payments using the Ongo mobile app or
Ongo QR Card.

The food services distribution (FSD) firm

METRO Wholesale Myanmar is a joint venture We also note that between July and November
between German wholesale company METRO 2018, several local lenders reduced their
AG and Yoma Strategic Holding. METRO buys saving and fixed deposit rates as part of asset-
directly from farmers on behalf of B2B liability management in following the 2017
customers, which include hotels, restaurants prudential regulations.
and canteens.
As a result, saving rates offered by two largest
lenders – KBZ and AYA – and First Private Bank
The joint venture also received $20m financing
(FPB) have reached the regulatory floor. Yoma
from IFC earlier this year.
Bank will join them in the next week.
At present, METRO Myanmar has over 400 The same four lenders also offer the lowest
customers across the country, with over 3,000 rates on fixed deposits.
food and non-food products available on its e-
commerce platform and mobile application. The current standard fixed rates offered by
most local banks are 9% for one month, 9.5%
Myanmar Financial Services Monitor notes for nine months and 10% for twelve months.
that earlier this month, Ongo partnered with a Those four lenders’ rates are often a full
large MFI BRAC Myanmar to provide digital percentage point lower.
loan collection services.
Click here to view the table showing the saving
interest rates across selected banks.
Ongo's other corporate customers include ride
-hailing app Oway, Carlsberg Myanmar, Coca-
Microfinance
Cola, motorbike rental firm Rent2Own and a
MMFA hoping more members join data
joint venture MFI Myanmar Finance
sharing platform
International Limited.
The Myanmar Microfinance Association
Banking
(MMFA) is hoping to encourage more
Yoma's saving rate down to the floor
members to join the Myanmar Microfinance
Data Sharing Platform (MCIX).
Yoma Bank announced that its savings interest
rate will be lowered from 8.25% to the
The MMFA held a workshop last week aimed
regulatory floor of 8% from 1 July.
at educating smaller local microfinance lenders
Myanmar Financial Services Monitor notes on the benefits of MCIX, which the MMFA and
that Yoma Bank also made a cut across fixed local IT system provider ThitsaWorks launched
deposit rates in April this year, following a in October last year.
similar reduction in July last year.

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Myanmar Financial Services Brief, 26 June 2019 10

We understand that there are 10-15 of the All data uploaded remains the property of the
larger MFIs involved in the platform, and that MMFA members. The monthly subscription
the MMFA wants to see more of its members fees ranged from Ks25,000 to Ks2.75m
join. depending on the number of clients an MFI
has.
We also understand the Financial Regulatory
Department (FRD) has given its approval for MCIX has been described as a "pre-credit
the platform to sit under the MMFA with bureau" for microfinance. Micro-lenders have
ThitsaWorks in charge of managing it. been trying to deal with over indebtedness
and prevent overlapping clients for some time.
The MCIX aims to allow lenders to share basic
credit information about potential borrowers Lenders initially began informally sharing
in order to prevent borrowers becoming over- customers' National ID numbers in areas like
indebted. Yangon, Mandalay and Bago, with the
FRD offering no-objection but also no
regulatory clarity.

The FRD's approval for the MCIX platform

helps lenders address the overlap issue, but
the industry is still without a credit bureau.

The IFC is hoping to see the Myanmar Credit

Bureau (MCB), whose regulatory architecture
it helped design, up and running this year.

MCB managing director U Kyaw Soe Min

Microfinance firms can search for clients’ previously told MFSM that the bureau has no
outstanding loans using their national immediate plans to move into the MFI sector,
registration certificate number. This is only but would do so "in the future".
possible, however, if the microfinance firm is
sharing data for the relevant jurisdiction. M&A
Myanmar Investments board, shareholders
According to an MCIX briefing document from reject merger
October, an MMFA-appointed committee
oversees the platform and is in charge of Myanmar Investments International (MIL) has
approving any changes to the terms and responded publicly to Myanmar Strategic
conditions of participation. Holdings’ (MSH) “unsolicited” merger offer,
which MIL said undervalued its assets.
Only MMFA members that are submitting
regular and complete data are able to use the The proposed offer from MSH “valued each
platform. Data is to be submitted by the 15th MIL share at $0.75 to be satisfied by $0.10 in
of every month, and must be provided for at cash and $0.65 in new MSH shares,” said MIL
least 80% of the MFI’s total clients. in a statement on the London Stock Exchange
on 18 June.
In the initial phase, MCIX will help lenders
share “basic” data for all active borrowers, But the MIL board said that the terms
detailed data for high-risk or defaulting clients “materially undervalue*d+” MIL, and did not
and contact information to allow lenders to attribute fair value to MIL’s assets or their
communicate with each other. “future upside”.

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Myanmar Financial Services Brief, 26 June 2019 11

MIL therefore rejected the proposal MIL’s losses were $2.8m for the 2016-17
“unequivocally”, the firm said. financial year, $3m in 2017-18 and $1.3m in its
most recent interim results published for 30
The following day, 19 June, MIL issued a September 2018.
second announcement after speaking to its
shareholders MSH posted losses of $2m for the 2017-18
financial year and $897,968 for its interim
“The board has been in contact with September 2018 results.
shareholders of the company who collectively
hold an interest in excess of 50% of the voting In January 2019, it reported a 472% year-on-
rights in the company's issued share year rise in revenue to $1.86m for the period,
capital,” the announcement said. The with 24% of that total coming from its
shareholders “unanimous” view was that the education business - Wall Street brand English
board was correct to reject the proposal. language schools. Services contributed 71%
and the remaining 5% from hospitality.
The London AIM-listed MIL announced earlier
this month that it was concentrating on Banking
current investments due to market Three regions lead MADB's JICA-funded loan
uncertainty, and was unlikely to consider any borrowers
new investments for the next few years.
State-owned Myanma Agricultural
The firm also announced that Stewart Development Bank (MABD) has lent a total of
Investors Asia Pacific Fund had sold 3.6m Ks93.8bn ($61.3m) to farmers across the
shares on 30 April - the entirety of its holdings country over the past 22 months using JICA
in MIL. This prompted MSH to make its offer to funding, according to government reports.
MIL, and announce its offer publicly on the
LSE. Since July 2017, MADB has used a two-step
loan program to provide financing to farmers
MSH said that Stewart Investors’ exit signalled for purchasing agricultural equipment and
that “certain MIL shareholders may be actively machinery.
seeking liquidity options for their investments
in MIL” - essentially that other MIL investors
would be looking to sell.

MSH, therefore, made a proposal that the two

firms combine generating “significant value to
both companies and their respective
shareholders”.

MIL said it has reduced its annual overheads or

“run-rate” costs from $2.2m down to $1.8m
and expects to see the figure hit $1.2m by the
end of 2019.

As at 31 March 2019, MIL management MADB borrows from JICA and then lends out
estimates the firm had approximately $3.7m in to farmers at an interest rate of 8.5% for
cash - enough to cover three years of between three and five years.
operation.

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Myanmar Financial Services Brief, 26 June 2019 12

The Ministry of Information reported that the Banking

only two areas where MADB has not made Bank branch network round up, 25 June
these two-step loans are Rakhine State and
Chin State. Ayeyarwady, Bago and Mandalay A couple of commercial lenders have opened
Regions, on the other hand, have received the new branches in recent weeks, prompting us
largest allocations. to update our bank branch rankings.

MADB has made Ks24.1bn in two-steps loans Global Treasure Bank (GTB)
in Ayeyarwady, Ks21.5bn to Bago and GTB opened a new branch in Mandalay's
Ks13.8bn to Mandalay as at the end of May Chanaye Thazan Township on 18 June.
2019.
This is the second branch the bank opened in
Myanmar Financial Services Monitor notes 2019 and GTB now has 167 branches in total,
that the total disbursement to Ayeyarwady making it the fourth largest bank by network,
was Ks10.4bn as of the end of October 2018, although it is only the eight largest lender by
while Mandalay and Bago totaled Ks9.5bn and assets, loans or deposits.
Ks8.2bn respectively.
Ayeyarwady Farmers Development Bank (A
Shan State has received the fourth largest Bank)
volume of two-step loans with over Ks9.9bn The young lender inaugurated its 15th branch
received as of 31 May 2019 – a Ks6.2bn in Shan State’s Muse on the China-Myanmar
increase from October 2018. border on 25 June.

MADB has made the smallest amount of loan The lender opened its 14th branch in
to Kayin with only Ks239.2m. Ayeyarwady Region back in April.

MADB has a similar two-step loan program A Bank previously said that it was planning
with Myanma Economic Bank (MEB), through new branches in border areas such as Muse,
which it lends out at 9% to farmers. Mawlamyine and Hpa-an.

In both cases, we understand that the loans Click here to view private bank ranking by
require farmers to hand over their farmland branch network.
use permits (form 7) and provide a 30% down
payment on an item being purchased.

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Myanmar Financial Services Brief, 26 June 2019 13

Selected banks by saving interest rates (as of June2019)

No. Bank Interest Rate

1 Innwa 9%

2 A Bank 8.7%

3 AGD 8.6%

4 SMIDB 8.5%

5 Yangon City Bank 8.5%

6 Shwe Bank 8.5%

7 Naypyitaw Sibin Bank 8.5%

8 TCB 8.5%
8.25% - 8.45%
9 GTB
(dependent on amount)
10 MD Bank 8.5%

MTB 8.3% (Tourism), 8.25% (Others)

11 MAB 8.25%
12 CHIDB 8.25%
8.25%
13 Yoma
8% (from 1 July)
14 MCB 8.25%
15 CB 8.25%
16 MMB 8.25%
17 UAB 8.25%
18 MOB 8.25%
19 G Bank 8.25%
8% (Corporate)
20 Myawaddy
8.25% (Individuals)
21 AYA Bank 8%
22 KBZ 8%

23 FPB 8%

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Myanmar Financial Services Brief, 26 June 2019 14

Local banks by branch network (as of June 2019)

No. Bank Branches

1 KBZ Bank 512
2 AYA Bank 250
3 CB Bank 226
4 Global Treasure Bank 167
5 Myanma Apex Bank 94
6 United Amara Bank 77
7 AGD Bank 77
8 Yoma Bank 76
9 Myawaddy Bank 64
10 Innwa Bank 58
11 Myanmar Oriental Bank 46
12 Myanmar Citizens Bank 42
13 First Private Bank 37

14 Tun Commercial Bank 24

15 SMID Bank 19
16 A Bank 15
17 Asia Yangon Bank 13
18 CHID Bank 12
19 Myanmar Microfinance Bank 12
20 Naypyitaw Sibin Bank 6
21 Shwe Bank 6
22 Yangon City Bank 5
23 Yadanabon Bank 3
24 Myanmar Tourism Bank 3
25 Rural Development Bank 2
26 G Bank 1

27 Mineral Development Bank 1

Total 1,848

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Myanmar Financial Services Brief, 26 June 2019 15

Local insurers by branch network (as of June 2019)

No. Insurer Branches

1 Myanma Insurance 39

2 GGI 22

3 IKBZ 19

4 FNI 15

5 AMI 12

6 Capital Life 7

7 Global World 6

8 Aung Thitsa Oo 3

9 Young Insurance Global 2

10 EFI 1

11 Aung Myint Mo Min 1

12 CB Insurance 1

Total 128

Licensed MFIs (as of March 2019)

Mar 2018 Dec 2018 Sep 2018 Jul 2018

Local 110 106 104 104
Foreign 47 45 45 42
NGO 16 19 19 22
INGO 3 3 3 4
JV 5 4 4 3
Total 181 177 175 175

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Myanmar Financial Services Brief, 26 June 2019 16

Selected investment deals in Myanmar (since 2014)

Sale price
Date Investment Investors Sector
($m)

January 2014 Asia Beverages Group Yoma Strategic Holdings, Delta Capital 18.4 Alcohol

JV: Myanmar Investments Internation-

Myanmar Finance In-
September 2014 al Limited (MIL), Myanmar Finance 5 Financial services
ternational (MFIL)
Company (MFC) and Norfund
Apollo Towers Myan-
November 2014 TPG ~40 Telecoms
mar

Apollo Towers Myan- Myanmar Investments International

July 2015 21 Telecoms
mar Limited (MIL)

December 2015 Myanmar Distillery Co TPG 100-200 Alcohol

September 2016 Rangoon Tea House Anthem Asia N/A F&B

April 2017 Ruby Hill Microfinance Dragon Capital, Loi Hein Group N/A Financial services

JV: Myanmar Investments

Medicare Internation-
May 2017 International Limited (MIL) and 0.895 Healthcare
al Health & Beauty
Medicare Vietnam
Freelancing
June 2017 Chate Sat Seed Myanmar, Theta Capital N/A
website
Myanmar Supply
October 2017 Chain and Services and ThaiBev 742 Alcohol
Myanmar Distillery
Digital Classifieds
January 2018 Belt Road Capital Management 1.9 Technology
Group
March 2018 Easy Microfinance Delta Capital 7 Financial services
Belt Road Capital Management, IFC,
April 2018 Oway 14.7 Tech /transport
Daiwa PI Partners

May 2018 Yoma Micro Power IFC, Government of Canada, Norfund 28 Energy

May 2018 EXERA Myanmar Strategic Holdings 2.2 Security

Access Myanmar Dis- JV: Pernod Ricard, Yoma Strategic,

May 2018 N/A Alcohol
tribution Company Delta Capital, Win Brothers

Singapore Myanmar Investco Limited

June 2018 TPR Myanmar Limited 10.8 Telcoms
(SMI)

June 2018 MyPay MySQUAR 2.6 (£2m) Financial services

Marathon Myanmar
September 2018 Seed Myanmar Ventures 0.1+ Logistics
Company

September 2018 For Her Myanmar N/A N/A Media

Pyramid Solutions
September 2018 N/A N/A Listings/media
(MyJobs)
September 2018 FMR Research Trust Venture Partners (TVP) N/A Research firm

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 Myanmar Financial Services Brief, 26 June 2019 17

Selected investment deals in Myanmar (since 2014)

Sale price
Date Investment Investors Sector
($m)
October 2018 MMTutors Seed Myanmar Five-figure Education
Seed Myanmar, Yangon Capital
October 2018 Flexible Pass Six-figure Fitness
Partners, Nest Tech

November 2018 Rent 2 Own German development institution 6 Automotive

GSMA Ecosystem Accelerator Inno- Six-figure

December 2018 Greenovater Agriculture consultancy
vation Fund grant

January 2019 Live the Dream Trust Venture Partners N/A Career consultancy

Myanmar Institute
January 2019 Trust Venture Partners N/A Education
of Business (MIB)

Zingo (by Ko Shwe

January 2019 N/A (International Investors) 0.35 Healthcare product
Ventures)

Katapult Ocean Accelerator

February 2019 RecyGlo Six-figure Recycling
Program

February 2019 Mote Poh EME, Nest Tech Six-figure Employee benefits

March 2019 KOSPA SF Holding 4 Logistics

March 2019 METRO Wholesale IFC 20 Wholesaler

LanThit Master-
March 2019 EME N/A Call centre
piece Limited

March 2019 rgo47 DPI N/A E-commerce

Shwe Taung
March 2019 SPC N/A Fuel retail
Energy

MM Digital
April 2019 Seed Myanmar, Theta Capital Six-figure IT solutions
Solutions

April 2019 MyanCare SPARX N/A Telemedicine

April 2019 Yoma Fleet Tokyo Century Corporation 26.6 Vehicle leasing

April 2019 Rent 2 Own Incofin 3 Automotive

April 2019 eSchool Blue Tech Venture 0.7 Edutech

Cocoon Capital, two unnamed

May 2019 Kargo 0.8 Logistics
angels

May 2019 Daung Capital BOD Tech Ventures, Majuven N/A Financial services

Source: MFSM, INSEAD Myanmar private equity report 2018

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Myanmar Financial Services Brief, 26 June 2019 18

COMPANY UPDATES
A selection of recently-updated profiles from the Myanmar Financial Services Monitor.
Access is available to Premium Subscribers only.

 Myanma Tourism Bank (MTB)  Yoma Bank

 Myanmar Investments International  Global Treasure Bank (GTB)
 Myanmar Strategic Holdings  IKBZ Insurance
 Myanma Agricultural Development Bank  Myanma Insurance (MI)
 Ongo (Ronoc Myanmar)  AGD Bank
 Financial Regulatory Department (FRD)  Grand Guardian Insurance (GGI)

DATA UPDATES

Foreign Exchange Rate

1800

1700

1600
25 June 2019
1500 USD Ks1515.7
EURO Ks1725.8
1400
SGD Ks1119.9
1300
Yen 100 Ks1411.1
1200

1100

1000
2-May
3-May
6-May
7-May
8-May
9-May

17-Jun

20-Jun

25-Jun
10-Jun
11-Jun
12-Jun
13-Jun
14-Jun
18-Jun
19-Jun
21-Jun
24-Jun
3-Jun
4-Jun
5-Jun
6-Jun
7-Jun
16-May

21-May

24-May

29-May
10-May
13-May
14-May
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20-May
22-May
23-May
27-May
28-May
30-May
31-May

USD EURO SGD Yen 100 Source: CBM

(25 June 2019) Yangon Stock Exchange (YSX) Quote (Myanmar Kyat)
1Y 1Y Yield Net
Stock Code Vol High Low Close
High Low Div % P/E Chg

13,000 8,500 FMI 00001 100 0.8 16.1 2,640 12,500 12,000 12,000 0

3,450 2,750 MTSH 00002 230 6.6 11.1 3,804 3,450 3,450 3,450 0

8,800 7,000 MCB 00003 200 2.5 25.9 0 7,900 7,900 7,900 0

27,000 20,000 FPB 00004 2,000 8.3 9.5 262 24,000 24,000 24,000 -500

TMH 00005 6.6 21.7 -50

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Myanmar Financial Services Brief, 26 June 2019 19

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