Pursuant to the terms of the Central Bank of Myanmar law, on 15 January, 2019, Central Bank of Myanmar (CBM) issued a Directive no. 1/2019 (“Directive”) in respect of the amendment of lending rates. The amendment as set out in the Directive shall be effective from 1 February, 2019.

In terms of the Directive, the lending rates on properties such as land, building, gold, diamond and precious gems, saving certificate, government treasury bonds, security and transferable contracts, pledge, loan with credit guarantee, loan based on pledge has been prescribed not to be more than 3% over the interest rate of the Central Bank (i.e. 10 +3= 13%).
As to the lending rates on transactions without collateral (as stated above), the lending rate shall not be more than 6% over the interest rate of CBM (i.e. 10+6+16%).

As per the Directive, the prescribed interest rate on saving bank deposit and saving certificate shall remain unchanged as 2% less than the interest rate of the Central Bank (i.e. 10-2=8%).

CBM has been focusing on liberalizing the banking and finance sector, and this instant Directive is an evident case highlighting the efforts towards promoting the sector.

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