Myanmar Central Bank Unlikely to Accept Deputy Governor’s Resignation: Sources

By Htet Naing Zaw 4 September 2019

NAYPYITAW—The Central Bank of Myanmar (CBM) is unlikely to accept the resignation of its deputy governor, U Soe Thein, according to government sources in Myanmar’s administrative capital Naypyitaw.

“I heard that U Soe Thein submitted his resignation directly to the governor and the governor is unlikely to forward it to the President’s Office. He doesn’t want to accept the resignation of his deputy,” a government source told The Irrawaddy on condition of anonymity on Wednesday.

“U Soe Thein didn’t come to the office today and the governor has called him to come in the afternoon,” they added.

As of early Wednesday evening, U Soe Thein had reportedly arrived at CBM headquarters in Naypyitaw that afternoon and met the CBM governor, and his resignation will in fact be put forward to the President’s Office.

U Soe Thein’s resignation followed a CBM statement on Monday that comments he made at the Parliament about bank loans to businesspeople do not comply with the bank’s stance.

During a session of the Lower House of Myanmar’s Union Parliament on Aug. 27, lawmaker U Maung Myint of the Union Solidarity and Development Party (USDP) raised questions about the CBM’s stance on businesses that have difficulty repaying their loans. He asked if the CBM has a plan to categorize the banks’ non-performing loans (NPL) according to the type of loan for each.

Though he understands the difficulties of business owners, U Soe Thein replied, banks provide loans to businesses not with their own money but with money deposited by people saving their money at the bank.

The CBM has done what is necessary to help borrowers repay their debt; some borrowers have owed the banks for many years and the CBM is no longer considering any leniency when dealing with NPLs, he said.

His comments came as a shock to the banking community.

“His answer to the first question was prepared and approved by the bank, but he had to answer the subsequent question on his own. Because the central bank governs all the banks in the country, he was supposed to guarantee that nothing will happen to the banks,” a government official in Naypyitaw with close ties to U Soe Thein told The Irrawaddy. “But then, he said with force that banking regulations have to be observed even at the risk of  [the collapse of] banks.”

What U Soe Thein said is not wrong, but he should not have said it at Parliament, the government official said, adding that he knows very well U Soe Thein is not afraid of offending even the CBM governor if he thinks he is right.

Banking circle insiders suggested that U Soe Thein resigned because of the CBM’s statement saying his answers do not fully comply with the CBM’s stance.

“The CBM releasing a statement like that affects his dignity. It is difficult to guess whether he will stay or not. I hope he continues in his job,” they said.

Parliament’s Banks and Financial Committee, governors and deputy governors of banks and government officials met on Tuesday at the CBM office, including U Soe Thein, according to a lawmaker who didn’t want to be named.

U Soe Thein handed his resignation directly to the CBM governor later that evening.

“He is an able man, but sometimes able men commit themselves. U Soe Thein tends to talk animatedly, and he tends to pour out what’s on his mind,” said a source.

Before his appointment as CBM deputy governor, U Soe Thein served as a consultant to the Asia Green Development Bank. He had also worked for years in the government’s budget department.

Any government official who comes to answer questions in an official manner in Parliament must make sure the information they provide is accurate and that their answers are in line with the policies of the departments they represent, Lower House Banks and Financial Committee chairwoman Daw Khin San Hlaing told reporters at a parliamentary session on Wednesday.

Because Parliament is at the center of public attention, department officials that come and answer questions must be accountable and responsible, she said.

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