Two Singapore-linked firms are making use of new banking services recently set up in Myanmar by United Overseas Bank (UOB).
The bank, which officially opened its Yangon branch yesterday, is extending a loan to Cycle & Carriage Automobile Myanmar Company to fund the building of two automobile showrooms and a servicing workshop in the city to cater to rising demand for private transport. It has also extended a loan to System-Bilt Myanmar to build a 200-room extension at the Summit Parkview, a four-star hotel, also in Yangon.
Cycle & Carriage Automobile Myanmar Company is owned by Singapore-listed Jardine Cycle & Carriage and Myanmar-based Automobile Alliance Co.
System-Bilt Myanmar is 100 per cent owned by Regional Hotel. Its managing director Woo Siew Hin said in a statement: "With the opening up of the Myanmar economy, we see more tourists and business travellers coming to the country."
UOB did not disclose the two loan amounts.
International visitor arrivals in Myanmar are expected to rise to 7.5 million in 2020 from 3.5 million last year. After Myanmar relaxed automotive import regulations in 2012, the number of vehicles in the country increased by 86 per cent in two years, with expectations that the number will grow 7.8 per cent a year through 2019.
The most recent funding deals struck by UOB follow one made in May when it extended loans to the Rangoon Excelsior Company to fund the refurbishment of a Yangon hotel.
Early last year, it provided offshore financing to Singapore firm Asiatech Energy, which had won a contract to build a power plant in Myanmar.
Singapore Deputy Prime Minister Teo Chee Hean told guests at yesterday's opening ceremony that many local companies are looking at long-term investment opportunities in Myanmar.
UOB's Yangon branch will provide corporate loans, trade financing and cash management solutions to regional and global companies expanding into Myanmar.