Defying the Pandemic Cathay United Bank Yangon Branch Officially Opens

The Yangon Branch of Cathay United Bank (the Bank) was granted preliminary approval by the Central Bank of Myanmar in April, 2020. The president Alan Lee said that this year, despite the impact of the COVID-19 pandemic, they have successfully established the Yangon Branch with the efforts of their colleagues in Myanmar and Taiwan and the spirit of “One Team”. They hope to continue to contribute to the Myanmar in the future. Successful Opening Despite Severe Pandemic since 2010, when the economic and political reforms were initiated and the country was opened to foreign direct investment.

Myanmar economy has grown rapidly, with an average GDP growth rate of over 6% from 2016. In 2014, the Bank established a representative office in Yangon, the commercial capital of Myanmar. By deeply cultivating the local market, grasping business dynamics, and building a network of relationships over the past 6 years, the Bank has planted the seed of success for the Yangon Branch. Myanmar has been hit hard by COVID-19 with over 120,000 confirmed cases by the end of 2020. Despite the challenges posed by the pandemic during the preparation phase, the Bank is able to open its branch within 9 months of approval through the efforts of supervisors and staff in Myanmar, supported by remote technology from the HO.

The Yangon Branch will focus on corporate banking business, provide deposits, remittances, corporate loans, syndicated Loans, project finance, trade finance and other financial services in local currency and USD, target local medium & large enterprises and Taiwanese enterprises, and assiduously participate in infrastructure and economic development projects. With a strong presence in Greater China and Southeast Asia, combined with the expertise and passion of the professionals, the Bank expects to provide quality, complete, and comprehensive cross- border financial services, creating a win-win scenario for both customers and the Bank.

Source: Myanmar Times


YSX stock trading dives in 2020

According to the annual report released by the exchange, a total of K12.6 billion worth of 1.87 million shares by six listed companies were traded on the Yangon Stock Exchange (YSX) in 2020, a significant drop compared to 2019. Over 2.4 million shares from five listed companies, valued K13.39 billion, were traded on the exchange in 2019. Both continuous trading and block trading on YSX fell in 2020 despite Ever Flow River Group Public Co’s (EFR) debut, on the exchange on 28 May 2020. Amid the COVID-19 crisis, Myanmar’s securities market has been able to continue operating without stopping trading. At present, shares of six listed companies — First Myanmar Investment (FMI), Myanmar Thilawa SEZ Holdings (MTSH), Myanmar Citizens Bank (MCB), First Private Bank (FPB), TMH Telecom Public Co. Ltd (TMH) and the EFR are being traded on the exchange.

In 2020, the value of stocks traded on the exchange peaked at K1.48 billion in February. In contrast, trading on the exchange registered an all-time low of K552.9 million in November due to the COVID-19 resurgence in Myanmar. In January 2020, 196,836 shares worth K1.25 billion were traded on the exchange while 188,919 shares, with an estimated value of K1.48 billion, were traded on the exchange in February and K1.42 billion worth 228,913 shares were traded in March respectively. It touched the lowest of K902 million with 173,808 shares in April. It rose to K1.2 billion with 200,416 shares being traded in May. The share volumes traded on the exchange surged to 221,682 in June, with estimated value K1.3 billion and then, it fell to K1 billion with 125,137 shares in July. In August, the exchange witnessed a low stock trading value at K747.5 million, with 118,850 shares traded. The value slightly rose to K838.67 million, with 85,237 shares on the exchange in September. It continued drops in October with 85,630 shares worth K673.5 million.

The value of shares traded on the exchange sank to the lowest level of K552.9 million in November, with 107,028 shares. The trading value rose to K1.14 billion with 139,513 shares in December, the exchange’s monthly report showed. The price per share of FMI decreased from K11,500 in January 2020 to K9,900 on 30 December 2020. The share price of MTSH remained unchanged at K3,850 last year. MCB’s stock price also dipped to K8,000 from K8,200. The cost of FPB showed a small drop from K23,000 to K22,500, while TMH slightly fell to K2,800 from K2,850. Nevertheless, the share price of EFR rose to K3,700 in Dec-end compared with the rate in May 2020. In 2016, only three companies were traded on the YSX — FMI, MTSH, and MCB. One more public company, FPB, was listed on the YSX in 2017. In 2018, TMH debuted on the exchange. EFR entered the exchange in 2020. This year, Amata Holding Public Co., Ltd has been approved to be listed on the exchange, and the listing date will be announced soon.

More than 2.5 million shares of three listed companies were traded on the YSX in 2016, and their value was estimated at K70 billion. In 2017, despite an increase in the stock trading volume to 2.6 million shares, the trade value was only K22 billion. In 2018, 2.3 million shares of five companies, worth K11.5 billion, were traded on the exchange, according to the annual report of the YSX. The stock markets worldwide have reported their largest declines since the 2008 financial crisis. Similarly, the local equities market is also scared by the COVID-19 crash, points out a market observer. At present, people are putting money in savings, rather than investing during the COVID-19 crisis, he added. YSX held webinar sessions on 26 and 27 December to share the future benefit of stock investment for the investors, in coordination with securities companies (MSEC, KBZSC, CBSC, AYA Trust SC, KTzRH and uabsc).

Next, the Securities and Exchange Commission of Myanmar (SECM) has allowed foreigners to invest in the local equity market from 20 March 2020.
Furthermore, YSX launched pre-listing board (PLB) on 28 September 2020 to provide unlisted public companies with fund-raising opportunities and build a bridge toward listing on YSX, YSX stated. The YSX was launched three years ago to improve the private business sector. It disseminates rules and regulations regarding the stock exchange and knowledge of share trading through stock investment seminars. The stock exchange has also sought the government’s support to get more public companies to participate in the stock market and help more institutional investors, such as financing companies, investment banks, and insurance companies, to emerge.

Source: The Global New Light of Myanmar


Myanmar’s manufacturing sector is still badly affected by the lockdown restriction

According to the Manufacturing Purchasing Managers’ Index (PMI) for November 2020, the Myanmar manufacturing sector is still badly affected by the lockdown, and demand and production continue to fall due to weak demand. Manufacturing in Myanmar continued to decline in November, with a slump in production; New orders All jobs and imports fell to record lows. The closure of factories due to restrictions imposed to control the spread of COVID-19 infection has been cited as the cause of the latest downturn. However, many indexes rebounded from last month’s lows and are the slowest in the current three-month slump. Companies expect production to increase in the next 12 months, but overall optimism is weak.

Looking at prices, inflation in the cost of production has accelerated during the last survey period, and survey respondents have often pointed to a shortage of raw materials. At the same time, declining factory prices have been linked to efforts to boost sales. Myanmar’s PMI for November was 43.2, up from 30.6 in October. The latest figures point to a recovery in Myanmar’s manufacturing sector, despite further signs of a downturn. When industries are shut down and demand weakens, up to 85% of the PMI is focused on components such as manufacturing, New orders Imports, inventories and workplaces came under heavy pressure on key indicators in November.

 Jobs were cut short as workers were forced to return to their hometowns due to lockdown restrictions. In the meantime, buying volatility has fallen at its strongest pace since December 2015, when the survey began, due to the stress of volatile demand in the coming months. Companies reported lower orders in November. Overall, the rate of decline was strong, but significantly weaker at the beginning of the last quarter. The latest drop in production with new orders further reduced the workforce. Production costs have risen for the second time in a row, with respondents explaining the scarcity of raw materials and rising transportation costs. Meanwhile, demand for the product fell sharply for the ninth straight month.

Finally, business confidence remains positive in the middle of the last quarter. Companies report plans to expand production and invest in equipment over the next year. Optimism is at its strongest in three months, but remains weak in survey data history. An economist at IHS Markit who conducted the survey said that Myanmar’s manufacturing sector is still severely affected by the latest lockdown restrictions. New orders As production and purchases fell sharply in November, job cuts also intensified. The latest downturn as a whole has been strong, the same amount as in February-June. The survey is based on original data collected from industry by IHS Markit and sponsored by Japan-based Nikkei Media Group.

Source: Daily Eleven


The Central Bank of Myanmar (CBM) has approved two more foreign remittance licenses to reduce the number of illegal remittance transactions and create more remittance transactions

The Central Bank of Myanmar (CBM) has issued two more foreign remittance licenses to reduce the number of illegal remittances and legalize remittances, and will be able to officially accept and send remittances. City Express Myanmar Ltd and Money King Co., Ltd were re-licensed by the Central Bank on 5 January 2021. The Central Bank of Myanmar started issuing foreign currency remittance licenses to five companies on November 18, 2020: OK Zune Co., Ltd .; 2C2P Plus (Myanmar) Co., Ltd; Wakhema Trading Co., Ltd; Top Shine General Services Co., Ltd; and OKM Global Remittance, which now has seven foreign remittance licenses. The holder of the foreign remittance business license must deposit 100 million kyats as security deposit and if the central bank directs that the business insurance deposit should be more than 100 million kyats due to the large size of the business, the licensee must comply with the instructions. 

The Revolving Fund must be kept in a separate account at an AD licensed bank and the bank statement of each bank account must be submitted to the Central Bank once a month. Holders of foreign remittance licenses are required to carry out Inward and Outward Remittance Business between Myanmar and other countries and receive money only for the purpose of remittance. Receiving money for remittances abroad when conducting remittance services; Remittances received in Myanmar must be made in Myanmar Kyats only. Foreign remittance services must be carried out only in the area permitted by the license. Back End Transactions can be carried out as a batch transaction between a local bank account and a private bank account or agent or branch or branch bank account or joint venture bank account. 

Netting must be done and remittances must be made through AD licensed banks. Once a month, the Central Bank of Myanmar shall submit the bank statement of the account opened abroad of the remittance business. The financial statements shall be submitted to the Foreign Exchange Management Department and shall be submitted to the Central Bank in accordance with the prescribed schedule. The maximum remittance amount per remittance or remittance amount is US $ 1,000, and the central bank limits the amount per remittance or remittance amount per person to US $ 5,000 per month.

Holders of foreign remittance licenses are required to comply with anti-money laundering and anti-terrorism provisions, and must report any suspected remittances in the remittance, which shall be maintained for at least five years. The initial license fee for foreign money transfer is one million kyats. The annual fee is 100,000 kyats and the license is valid for three years. Holders of foreign remittance licenses will be subject to disciplinary action up to and including revocation of their licenses if they violate the rules and regulations set by the Central Bank, and will face a fine of not less than 10 million kyats for each non-compliance.

Source: Daily Eleven