August 20, 2016

‘just a rumour’ CBM quashes speculation about bank closures

A customer makes a deposit at a bank branch in Yangon.
A customer makes a deposit at a bank branch in Yangon.

The Central Bank of Myanmar refuted rumours Tuesday about the impending closures of some banks resulting from large numbers of customers withdrawing their savings.
In a press release, the Central Bank of Myanmar quashed the rumours purporting that the CBM was planning to shut down some banks, stating it had no such plans.
The CBM said stories circulating about bank closures “are just a rumour,” as all banks in Myanmar are kept under close scrutiny of the CBM.
“If a bank run happens to private banks, they will be fully provided with necessary assistance in accord with the law,” the CBM statement said.
All banks operate under the regulatory framework of the CBM, U Set Aung, CBM Deputy Governor, told the media at a press conference in Nay Pyi Taw on Tuesday.
“In addition to daily financial reporting to the CBM by private banks, quantitative methods are also being applied,” he said.
To allay concerns, the deputy governor reiterated that the CBM would lend money to any banks during a run on deposits if the banks were unable to acquire additional cash elsewhere.
Rumours about bank closures in the wake of leadership changes in the country’s ruling party have circulated on social media for several days, leading some depositors to rush to withdraw their savings.
Seeking to counter the speculation, U Ye Min Oo, a former senior official in the country’s private banking industry, wrote a Facebook post stating that internet rumours about possible bank closures had been frequent since late 2010 and followed significant events in the country.


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