THE semi-government Myanmar Industrial Development Bank in fiscal 2004-2005 granted loans totaling nearly four times the amount of money it had granted in the previous fiscal year, the bank’s chairman, Major General Saw Lwin, said last week.

Much of the increase went into the industrial sector, said Major General Saw Lwin, who is also the Minister of Industry 2, and the chairman of Myanmar Industrial Development Working Committee.

The bank granted loans totaling K2.37 billion to the industrial sector alone in the 2004-2005 fiscal year, up from K660 million in 2003-2004, he said.

He was speaking on July 9 at the bank’s 10th annual general meeting, which was held at its headquarters on Pansodan Street in Yangon.

“Deposits at the bank also rose from K3.7 billion in 2003-2004 to K4.164 billion in 2004-2005,” said Major General Saw Lwin.

“In (2004-2005) the bank received K4.164 billion in deposits and granted loans totaling K3.235 billion, or 77 per cent of the total deposit amount,” he said.

“The Central Bank of Myanmar has instructed every bank in the country to lend between 70 and 80 per cent of total money deposited to the bank,” he said.

“We realised that as the development of the industrial sector gained momentum, we needed to overhaul the system for providing loans to private entrepreneurs,” said Major General Saw Lwin.

“With deposits to our bank steadily increasing, we are planning to provide more loans to the industrial sector than ever before, especially to owners of converted compressed natural gas buses and to entrepreneurs who are running advanced iron melting plants in upper Myanmar industrial zones,” he said.

The Central Bank of Myanmar has also said that non-performing loans (NPLs) must account for less than 10 per cent of each bank’s total loans, he said.
Major General Saw Lwin said that only 3.1 per cent of the money loaned by Myanmar Industrial Development Bank in 2004-2005 was non-performing, a total of K79 million loaned to 13 people.

U Thein Aung, the managing director of the bank, said at the meeting that the majority of the institution’s loans go to the country’s industrial sector: During fiscal 2004-2005 more than K1.7 billion in loans went to industrial zones and K580 million to private cottage industries.

“In 2004-2005 more than 70 per cent of the bank’s loans went to the industrial sector, while the rest – which amounted to K900 million – went to other sectors,” he said.

The bank made K180 million in profits and paid more than K50 million in government revenue last financial year, he said.

Myanmar Industrial Development Bank, as a public institution, has this year allocated more than K80 million to 1209 shares held by its 294 shareholders, making the value of each share about K65,000, said U Thein Aung.

He invited shareholders to cash in their shares beginning on July 11.

In 2004-2005 the bank purchased treasury bonds worth K1.45 billion from the Central Bank of Myanmar, from which it earned K160 million in interest.

The bank also earned K278 million in interest from deposits last year.

Myanmar Industrial Development Bank was established as a public institution in February 1996 and now operates branches in Yangon, Mandalay and Meikhtila.