Myanmar Regime Says Private Banks’ Foreign Hires Must Be Approved

By The Irrawaddy 4 August 2021

The junta-controlled Central Bank of Myanmar (CBM) has required private banks to seek its approval to recruit foreigners, while also restricting the number of foreign appointees.

Private banks are to seek the approval of the Central Bank 30 days prior to recruitment of foreigners to various positions including advisers, instructed the CBM on Monday. The number of foreign appointees is limited to 25 for large banks, 15 for medium-sized ones, and eight for smaller ones.

The CBM said the move aims to make sure the work done by foreign employees can be continued when their contracts end or if they resign before their contracts end.

Banks owned by Myanmar citizens are no longer allowed to appoint foreigners as governor or vice governor. Foreigners can still be appointed as chief executive officer (CEO) on condition that their deputy is a Myanmar citizen.

The CBM has also restricted appointments of foreigners as department heads, saying only half of such positions in a bank can be held by foreigners, and their deputies must be Myanmar citizens.

The CBM said it would assess the expertise and experience of foreign candidates before giving approval. It has also introduced a probation period—one year for department heads and six months for lower ranks. Employment contracts are limited to three years.

“Foreigners are employed in banks mostly for operations. The policies are mostly decided by their Myanmar citizen owners,” a banking expert told The Irrawaddy. He however declined to comment on the CBM’s decision to limit foreign employees.

Under the ousted civilian government led by the National League for Democracy, the CBM adopted stricter eligibility criteria in 2019 for top positions such as CEO and managing director at private banks, requiring that the positions be limited to experienced professionals.

The move was intended to restrict local private bank owners from appointing their inexperienced children to decision-making positions, thereby resulting in undesirable consequences.

The order was followed by private banks recruiting foreigners with banking experience.

At present, many local private banks including KBZ, UAB, Yoma and MCB employ foreigners in top positions.

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