Interview: Quach Hung Hiep
What were the factors behind the decision to apply for an operating licence for Myanmar?
QUACH HUNG HIEP: We see great potential in the Myanmar market. Once a closed economy, Myanmar is now transforming, and integrating its market with the ASEAN region and the world. In recent years, we have witnessed a rapid increase in commerce and investment activities from Vietnamese corporates, with most of them being BIDV’s customers. At the same time, we believe that Myanmar and its 55m-person market have a geographic advantage, as they connect three major markets: India, China and mainland South-east Asia.
These were the factors that motivated our decision to establish a representative office in Myanmar in 2010, a microfinance company in 2015 and our first foreign branch in Yangon in 2016. BIDV has also launched subsidiary and joint-venture operations in Laos and Cambodia, and with the establishment of our Yangon branch, we have a competitive advantage, as we provide financial products to corporates from the Cambodia, Laos, Myanmar and Vietnam bloc. This has become even more vital since the ASEAN Economic Community was established on December 31, 2015.
What impact do you expect the granting of operating licences to foreign banks to have on the financial services industry?
HIEP: Along with the rapid process of economic liberalisation and integration, without a doubt the entry of major foreign financial institutions will not only offer modern banking products and technologies, but will also significantly boost Myanmar’s financial markets through an increase in foreign capital flows to corporates. Competitive dynamics, strong and diversified development, and improved financial products would follow. In addition, Myanmar’s talented youth will benefit from career opportunities at foreign banks and also from the broadening of domestic corporates. At the moment, foreign banks must still operate under certain business restrictions, but we believe that these will gradually be lifted.
In your opinion, what opportunities exist for local and foreign banks to collaborate on a greater scale in terms of cross-border trade?
HIEP: Our experiences in Vietnam, Laos and Cambodia proved that opportunities exist for domestic and foreign banks to collaborate. Local banks have the advantage of existing customers, widespread networks and market expertise, while foreign banks benefit from foreign capital, technology, modern banking products and major international clients. Collaboration between local and foreign banks also helps partnerships to develop between local and foreign corporates. Many firms from Vietnam, Laos, Cambodia, Japan, South Korea, Taiwan and so on, have come to us seeking opportunities to cooperate with Myanmar enterprises. Also, by broadening international payment channels and offering trade finance and derivatives products, Myanmar corporates will be supported in expanding their businesses.
What role will BIDV play in the development of the talent pool in Myanmar?
HIEP: Just like other foreign banks, BIDV pays special attention to the detection and development of Myanmar’s talented youth. We consider this an essential resource to ensure success in the country’s market. For the last five years, even before we established the Yangon Branch, BIDV has been providing annual scholarships for outstanding students from Yangon University of Economics, while also sponsoring many social security programmes to develop Myanmar’s education. In the near term, BIDV has set out plans to recruit young Myanmar staff and provide them with training opportunities to develop their careers. One of these strategies involves training young staff to eventually hold senior branch management positions.
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