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Best bank: Aya Bank
Ayeyarwady Bank, more commonly known as Aya Bank, is a fascinating financial institution. Founded in 2010 by the tycoon Zaw Zaw, it has never been afraid to think differently and ahead of the curve. In 2015, it became the first local lender to meet IFRS compliance requirements and to be audited by one of the big four global accounting firms.
An early pioneer in mobile and internet banking, it has invested heavily over the last year to upgrade its core banking system. It voluntarily underwent its first human rights audit in 2014 and was the first Myanmar bank to invite independent directors onto its board.
It clearly believes in equality in action as well as in theory: a shade under 60% of the staff are female; women occupy senior positions at the executive level, including the vice-chair, executive director and deputy managing director.
This rapid change, Aya Bank hopes, is just the start, given that less than 10% of people have access to a formal bank account. It opened its 220th branch in 2017, employs more than 8,200 staff, and oversees K4 trillion ($3 billion) in deposits and K3.5 billion in assets. It also serves 1.3 million customers, a number that has jumped by 900,000 in three years.
In February this year, the bank put in a formal request to the central bank to raise fresh capital to boost its capital adequacy ratio to 10% by the end of 2019.
It recently launched an underwriting business, Aya Trust Securities, with more than half an eye on its own future stock listing.
Aya also has the respect of its peers: on a visit to Yangon in February, every bank chief executive interviewed by Asiamoney talked openly about their respect for the lender. A worthy winner of this award.
Best corporate and investment bank: CB Bank
Like the best banks in Myanmar, CB Bank is always looking to find new ways to improve. Founded in 1992, the lender has spent the last few years updating its core banking system, introducing internet banking for corporates, as well as catering to the needs of large domestic companies that want to expand in Myanmar and beyond, as well as to foreign multinationals hoping to crack this vast and underdeveloped market.
U Kyaw Lynn
CB Bank was the first local lender to roll out pre- and post-shipment export financing and export letters of credit, and to introduce a spot and forward foreign exchange transactions service for import LCs, outbound remittances and bank guarantees.
In 2017, it unveiled a structured trade unit and currency exchange machines to meet the needs of local firms eager to expand their regional footprint.
CB Bank also upgraded its IT capabilities and introduced new cash management services – notably electronic payments and receivables, and liquidity management solutions – tailored to the needs of multinationals, financial institutions and NGOs.
A key focus now is to introduce seamless digital services to the bank’s main clients, including bulk payroll processing. Recognizing the need to draft in executive talent from beyond its shores, CB Bank hired two Singaporean bankers with extensive experience in this space: Toh Kai Leong, who joined as head of corporate banking after stints at ING and OCBC, and Liew Chee Seng, adviser to the chief executive U Kyaw Lynn, who was previously head of financial institutions at Abu Dhabi-based First Gulf Bank.
Best digital bank: CB Bank
Digital banking is a work in progress in Myanmar. Some banks are better at it than others; only a few have given hard thought to their online strategy. CB Bank is by some distance the leader in this field. It was the first Myanmar lender to introduce cash deposit machines, contactless payment services, CRM machines and mobile banking. More than 500,000 of its customers now bank with it on the move.
It is also a fintech pioneer, tying up a deal in September 2017 with Qatari telecoms operator Ooredoo Myanmar to roll out M-Pitesan, a popular mobile wallet. CB Bank now boasts 1,100 Easi mobile agents scattered around the country, including 136 based at post offices, who act as trusted financial intermediaries, dispensing and collecting cash or electronic payments for CB Bank’s retail and small-business customers.
“This is a great illustration of how to increase financial inclusion”, Liew Chee Seng, adviser to the chief executive, tells Asiamoney – a vital consideration in a country where more than nine out of 10 people do not have access to a bank account. Nor is the bank standing still. Plans for 2018 and beyond include the roll out of a CB Bank QR code payments system, allowing merchants to receive digital payments without a point-of-sale machine; and a renewed focus on digital security – the lender has joined forces with Cisco Advanced Services to ensure its digital services are secure.
Best bank for SMEs: CB Bank
A vast army of small and medium-sized enterprises form the heart, gut and soul of this frontier market. In an overwhelmingly cash-based economy, SMEs make up 90% of all businesses, few of which have access to formal banking services. But a few lenders are spearheading a drive to bring banking to small business owners, led by Yangon-based CB Bank.
Founded in 1992, the lender sees small firms as an important economic pillar for the development of the country. The key to its SME operations is its clear-minded focus on digital excellence. It was an early champion of point-of-sale machines, rolling them out across the country, and has led the boom in mobile agents. CB Bank has 1,100 such agents dotted around the country, usually pillars of the local community who act as trusted financial intermediaries, allowing a farmer or small trader to send money via an agent to a CB Bank branch in the nearest town or city, to pay for anything from seeds to consumer goods to workers.
It was the first bank, in alliance with the finance ministry, to introduce a credit guarantee insurance scheme, helping small firms to take out loans of up to K20 million ($15,000). In 2017, it finalized a deal with Germany’s KfW, enabling it to extend corporate loans of up to €4.45 million at low rates of interest.
CB Bank has two SME centres, in Mandalay and Yangon, geared toward smaller firms; the bank aims to expand that number to 20 in the medium term.
Best international bank: OCBC
When Myanmar opened up after 2012, it was quick to hand out banking licences – and Singapore’s leading lenders were first in line. This year, the award for best international bank in Myanmar goes to OCBC, which has been here on and off since 1923.
OCBC restarted local banking operations in April 2015; in 2017 it underlined its commitment to the country by doubling its paid-up capital to $150 million and opening Myanmar-focused desks in Singapore, Malaysia and China.
Current rules prevent foreign banks from offering commercial or retail banking services to local corporates or residents, so OCBC has focused on providing key services such as project financing to corporates from Asia, Europe and North America. Recent highlights include a $30 million three-year term loan to finance one of the largest real estate projects in Yangon, and a seven-year, $40.2 million syndicated term loan facility – the first of its kind in the country – to OCK Yangon, with the aim of erecting 900 telecoms towers.
Under general manager Daniel Tan, OCBC has been busy making friends in the local community, providing training to local financial institutions, while extending treasury, money market and cash management services to more than 20 privately owned and state-run lenders.
Best bank for CSR: KBZ Bank
KBZ is an exceptional lender with a storied history and matchless connections in the capital Naypyidaw. Its domestic clout and strength means that its CSR credentials are often overlooked. Yet KBZ is the undoubted domestic leader in this field, its commitment to corporate and social responsibility stemming from a terrible and destructive moment in the country’s modern history. In 2008, a massive cyclone crashed into Myanmar’s long coastline, killing 138,000 people, displacing millions, and causing at least $10 billion worth of damage. That calamity compelled the bank to set up its social initiative division, KBZ Brighter Future Myanmar Foundation, and to get to work.
The foundation has since disbursed $103 million in financial aid to a host of projects, including disaster-relief programmes, women’s health and empowerment schemes, and environmental conservation projects.
In one initiative, the bank put $7 million to work in a project aimed at distributing clean water to thousands of villages in southern Shan state.
Education is another key focus, with the foundation dispensing micro-loans to more than 12,000 people in rural areas around the Yangon, and college grants to thousands of the country’s best but poorest students.