International Finance Corporation (IFC), a member of the World Bank Group has converted a 2014 loan provided to Yoma Bank to equity. IFC will hold a 5 percent stake in Yoma Bank and become the first foreign investor in a commercial bank in Myanmar. The conversion from debt to equity was approved by the Central Bank of Myanmar in October last year. The institution has helped Yoma Bank provide over 7000 loans worth around US$800 million to SMEs in the country and increase the bank’s outreach from 52 branches to 80.
“We are pleased to be the first domestic bank to accept a foreign investor as our shareholder. Yoma Bank has partnered with the International Finance Corporation (IFC) over the past five years improving our risk management, corporate governance, and audit capabilities. We welcome IFC to our Board of Directors and look forward to contributing further to the development of Myanmar’s economy,” said Yoma Bank executive chairman Serge Pun.
In early 2019, Central Bank of Myanmar permitted foreign institutions and investors to invest in local banks up to 35% stake. Yoma Bank can still divest 30% stake to foreign investors.
Apart from Yoma Bank, IFC had provided a convertible loan of $7 million to Myanmar Oriental Bank to finance SMEs.
Sources - myanmar times, Deal street Asia