The Myanmar Government is planning to allow some foreign banks to start limited operations in the country in late 2014.
A senior Myanmar government official involved in the plans told Reuters that Myanmar President Thein Sein formed a committee last week for selection of five to ten out of about 40 foreign banks having representative offices in the country.
"We plan to select suitable ones soonest and give them a limited licence so that they can start operations before the end of this year," the official added.
Approved by the central bank governor Kyaw Kyaw Maung-led committee, the banks will initially be allowed to open branches in certain areas and offer a limited range of products to customers.
The committee also includes deputy finance minister, deputy attorney general, and central bank deputy governors.
The arrival of foreign competition has long been resisted by the local banks arguing that the move will be disadvantageous to them as foreign lenders are far bigger in terms of capital, have better technology and more expertise in modern banking.
Another unnamed senior official told the news agency that the attempts by some lawmakers to block the entry of foreign banks have failed.
"Since the president has set up this committee now, allowing foreign banks to operate is just a question of which. It’s no longer a question of if," the official said noting that the domestic private banks need not worry as the foreign banks would be granted limited licences.
"We do understand their concerns but, on the other hand, it’s quite impossible to attract investment from big foreign companies if international banks are not allowed to operate here."
Approximately 34 foreign banks, including Standard Chartered have representative offices in the country, which is slowly opening up its banking sector following a series of economic and political reforms, as reported earlier by the news agency.
Image: Standard Chartered is one of the 34 international banks having representative offices in Thailand. Photo: Chintunglee.