A bank teller in Yangon counts 200 kyat notes as Myanmar’s banking sector changed significantly with Co-opeerative finalising a merger on June 16.

THREE banks – Co-operative Bank, Co-operative Farmers Bank and Co-operative Promoters Bank – merged on June 15, a move which makes the newly consolidated Cooperative Bank a public company.

The company formally announced the decision at a press conference at Traders Hotel on June 19.

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Co-operative Bank becomes the first merger since Myanmar began market economic policies in 1989. The decision means the bank has paid-up capital of K1.5 billion, compared to K300 million when it was founded in 1992, separate from Co-operative Farmers Bank and Co-operative Promoters Bank.

The merger increases the number of CB Bank branches from eight to 13.

“The purpose of merging the three banks is to strengthen the banks’ finances, and to increase capital and the number of customers,” said U Khin Maung Aye, deputy chairman and chief executive officer of Cooperative Bank Ltd.

“CB Bank now has about K22 billion in deposits following the merger – about K21b of this amount belonged to the former CB bank before the merger,” he said, adding that deposits more than tripled between February 2003 and the end of May 2004.

CB Bank now aims to issue an Initial Public Offering within the next 18 months, a move which may generate strong demand considering the company share price soared 30 per cent just before the merger was finalised.

U Khin Maung Aye said that CB Bank will also open more branches once Central Bank restrictions are lifted on private banks. Its services include current account deposits, savings accounts, overdraft facilities, call accounts, gift cheques and loans – credit card services have still not been reinstated. The bank mainly lends to the industrial sector and trading companies, and to a lesser extent construction companies.

CB Bank is the third largest bank in Myanmar in terms of deposits, behind Kanbawza Bank and Myawaddy Bank.