| Market Development
More than 70% in Asia Pacific not using mobile financial services Business Mirror 19th Jun 2015
Amdocs, the leading provider of customer experience solutions, on Friday bared a new Asia-Pacific survey that found that 70 percent of the respondents in the region are not using mobile financial services, highlighting a great opportunity for mobile financial service (MFS) providers. The survey identified security, ease of use and the ability to use the service anywhere, including online and in-store, as the key enablers that will drive mobile financial services adoption. The survey also reveals consumer’s desire for new, innovative and exciting payment services, such as payment for education and medical treatment, which will win customer loyalty and further drive usage.
Credit access in Philippines most restrictive in Asean – USAID The Philippine Star 19th Jun 2015
Access to credit in the Philippines is the most restrictive compared with other Association of Southeast Asian Nations (Asean) member states, a United States Agency for International Development (USAID) study said. In order to raise credit available in the country, USAID’s Advancing Philippine Competitiveness (COMPETE) project urged the Bangko Sentral ng Pilipinas (BSP) to scrap the special deposit account (SDA) and lower the reserve requirement ratio. The COMPETE project, conducted by Dr. Mario Lamberte and Ammielou Q. Gaduena of the University of the Philippines School of Economics, was launched in 2012 to improve the country’s competitiveness and attain higher levels of trade and investment.
OJK Gives Foreign Investors Leniency to Acquire Sharia Banks Tempo 19th Jun 2015
The Financial Services Authority (OJK) said they will provide lenient terms for foreign investors wishing to tap into Indonesia's sharia banking industry. OJK banking supervision director Nelson Tampubolon said foreign investors will not have to acquire a minimum of two sharia banks for them to obtain a permit from the regulator. In the conventional banking industry, foreign investors must at least acquire two local banks before they can get OJK's approval for expansion. Foreign investors are also allowed to acquire conventional banks to be converted into sharia banks.
US banks stay picky on Myanmar transfers Myanmar Times 19th Jun 2015
American banks continue to hesitate on money transfers to and from Myanmar, despite the removal of most sanctions on finance in 2012 and 2013. Businesspeople say that while there are now few explicit rules preventing transfers, a fear of sanctions and a shallow understanding of the local market prevents the movement of money between Myanmar and the world’s largest economy. Some say the continued existence of the Specially Designated Nationals (SDN) blacklist may also be dissuading American banks and companies from doing business with Myanmar. “US banks, by-and-large, are steadfastly refusing to undertake any transactions with Myanmar, with few exceptions,” said Eric Rose, lead director at Herzfeld Rubin Meyer & Rose Law firm in Yangon.
Malaysia Islamic Insurers Go Digital to Attract Younger Audience Bloomberg 18th Jun 2015
Malaysia’s Islamic insurers are seeking to double policy holders in five years by investing more in digital technologies to attract a younger audience, according to the industry association’s head. Takaful operators should also step up educational campaigns to boost customers to 8.4 million by 2020 from about 4 million now, Ahmad Rizlan Azman, chairman of the Malaysian Takaful Association, said in an interview from Kuala Lumpur Tuesday. The Shariah-compliant industry is aiming for a 25 percent market share compared with 14 percent at the end of 2014, he said. Islamic insurance in Southeast Asia has the potential to catch up with the leader Saudi Arabia, driven by increasingly young populations and strong economic growth, according to a report from Ernst & Young LLP, which forecasts global assets will climb to $20 billion by 2017 from an estimated $14 billion last year.
Financial literacy elements added to school curriculum The Malaysian Insider 18th Jun 2015
Bank Negara Malaysia (BNM) and the Education Ministry have introduced a module for primary schools to educate pupils in good financial management. Finance deputy minister Datuk Ahmad Maslan said the module containing elements of financial literacy was incorporated into the school curriculum last year for Year Four pupils, and expanded for Year Five pupils this year. "The module will be extended in stages to other classes, he said in reply to Datuk Datu Nasrun Datu Mansur (BN-Silam) at the Dewan Rakyat in Kuala Lumpur today. He said the BNM-Education Ministry initiative was aimed at producing a financially literate generation capable of making smart financial decisions.
Malaysian investors looking towards US$ and foreign markets for better returns ASEAN Investor 17th Jun 2015
The falling ringgit and growing pessimism towards the local stock market are driving Malaysian investors to look at foreign currencies, especially the US dollar and overseas markets for better returns. A recent survey by Franklin Templeton Investments found that 53 per cent of Malaysian investors would invest in foreign currency-based funds within the next three years, up from 45 per cent last year. According to the international fund manager, Malaysian investors are also cautious about the prospects of the local equity market this year, with 39 per cent expecting the benchmark index to decline and 30 per cent expecting it to be flat. “The decision to invest in foreign currencies is mainly driven by how the local currency has performed against other currencies over the last one year,” Franklin Templeton Asset Management (M) Sdn Bhd country head-Malaysia Sandeep Singh said.
Indonesia Accepts Islamic Megabank Challenge Shelved by Malaysia Bloomberg 16th Jun 2015
Indonesia is taking on the challenge of creating an Islamic megabank that has so far proven too difficult for lenders in Malaysia and the Middle East. The government plans to merge the Shariah-compliant units of state-owned PT Bank Mandiri, PT Bank Negara Indonesia, PT Bank Rakyat Indonesia and PT Bank Tabungan Negara with paid-up capital of more than 15 trillion rupiah ($1.1 billion) next year, Gatot Trihargo, deputy minister for government-run enterprises, said in a June 10 interview in Jakarta. Financial Services Authority Chairman Muliaman Hadad said in January that the plan may materialize this year. Malaysia has been touting the idea of forming an Islamic megabank that can compete with the likes of HSBC Holdings Plc for six years and a three-way merger to create one fell apart in January.
State sharia lenders expected to merge into one by 2017: OJK Jakarta Post 15th Jun 2015
The Financial Services Authority (OJK) expects to see the establishment of a state sharia bank by 2017 at the latest, as revealed in its sharia banking road map. In the road map, launched on Saturday, the OJK has established a timeline that runs from 2015 until 2017 for the creation of the state sharia lender. It claims that such a bank will help the overall sharia banking industry strengthen its capital and improve its efficiency. OJK chairman Muliaman D. Hadad said his agency was partnering with state banks and the State-Owned Enterprises (SOE) Ministry as related stakeholders to realize the plan.
Asset Management
PSE launches new trading system today The Philippine Star 22nd Jun 2015
The Philippine Stock Exchange Inc. (PSE) is proceeding with the debut of its new trading system today after deferring its supposed launch last June 1 following further testing and approval required from the Securities and Exchange Commission (SEC). In a statement over the weekend, the PSE said it would officially say goodbye to its old trading system which has been in use since 2010 as the PSEtradeXTS officially goes live today. “We are eager to shift to the XTS platform which runs on Nasdaq’s X-stream Trading technology. We are confident that this platform will aid us in our commitment to provide more services responsive to the needs of investors and other stakeholders,” PSE president and chief executive officer Hans B. Sicat said.
Wild market swings seen easing up The Philippine Star 22nd Jun 2015
There should be fewer wild swings in the foreign exchange and equities market as investors are expected to have already priced in an eventual increase in US interest rates, a top Bangko Sentral ng Pilipinas official said. BSP Deputy Governor Diwa C. Guinigundo made the comment as global financial markets remain volatile amid the Greece debt issue and pending the US Federal Reserve’s interest rate hike. He said that as early as 2013, when the US Fed hinted adjustments in its rates that have been kept near-zero since the global financial crisis of 2008, emerging markets suffered massive capital outflows as investors rebalanced their portfolios.
Short-sellers descend on Singapore stock market Reuters 19th Jun 2015
The Singapore stock market has unexpectedly turned into a playground for short-sellers looking to profit from weakness in shares of companies with heavy exposure to a slowing Chinese economy or the energy sector. The average short interest for stocks traded on the Singapore Exchange (SGX) has jumped over a quarter so far this year, with nearly 1.2 percent of companies' free float out on loan compared with 0.9 percent on Dec. 31, according to London-based financial information services firm Markit. Singapore has never been a hotbed of short-selling like Hong Kong, due to the market's relative small size and lack of depth. The surge in shorting interest was triggered by China's slowing economy and low energy prices. Attacks on commodity trader Noble Group Ltd from a research outfit and a short-seller also stoke shorting interest.
Both Global And Domestic Developments Affect Ringgit's Movement, Says BNM Bernama 18th Jun 2015
Bank Negara Malaysia (BNM) today reiterated that the Ringgit's current movements are affected by both global and domestic developments. The central bank was referring to recent inaccurate and misleading media reports regarding alleged reasons for the volatility in the Ringgit's exchange rate. Bank Negara said it remained focused on its role and mandate in maintaining monetary and financial stability and to support sustainable economic growth. "BNM has never been and will not be drawn into any political agenda but will remain accountable for delivering its mandates to the people of this country," it said in a statement released today.
DBS plans to issue Singapore's first covered bond The Straits Times 17th Jun 2015
DBS Group Holdings Ltd. is planning to sell Singapore's first covered bond as lenders in Asia seek to lift the quality of their assets amid tighter rules. The city-state's largest bank will meet investors in Asia, Europe and the U.S. from June 22 to discuss a euro- or dollar- denominated bond offering, according to a person familiar with the matter. An issue would mark the start of a potential US$10 billion (S$13.4 billion) sale program, the person said. DBS joins lenders in Malaysia and Korea selling covered bonds as Basel III rules that require banks to hold more liquid, high quality debt are enforced. Covered bonds typically get the highest grades from rating companies as they're backed by performing mortgages and other investments perceived as safe.
No plans to peg Ringgit Malaysia, says Finance Ministry The Sun Daily 16th Jun 2015
The government has no plans to peg the Ringgit like it did during the 1997-1998 Asian financial crisis, says the Finance Ministry. The ministry, in a written reply to Lim Guan Eng (DAP-Bagan), the ministry said there are no plans to do so as the current scenario faced by the country today is different from the past. "The current situation is influenced by the global development, like how the neighbouring countries are going through," it said. The ministry said that like any flexible exchange rate system, the increase and decrease of the currency in the short term could happen, especially in the uncertain global environment.
Foreign funds outflow from Bursa worse than 2014 The Rakyat Post 15th Jun 2015
Heavy foreign selling on Bursa does not seem to be abating, noted MIDF Research in a note today, due to uncertainty – especially over Greece – blamed for an uninspiring last week and caution ahead of the Fed’s Federal Open Monetary Committee meeting on Wednesday, June 17. “Foreign investors have now been net sellers on Bursa for seven consecutive weeks. And for the third week running, the amount offloaded was more than RM850 million a week — the longest undisrupted stretch of ‘intense’ selling so far this year. “Last week’s selldown increased the cumulative net foreign outflow in 2015 to RM7.5 billion, surpassing the RM6.9 billion outflow for the entire 2014.
Banking
Bank Rakyat eyes expansion of services to Indonesia via tie-up New Straits Times 22nd Jun 2015
Bank Rakyat is optimistic to start expanding its services to Indonesia beginning January 2016 through a collaboration with the republic’s biggest bank, PT Bank Rakyat Indonesia. President/managing director, Datuk Mustafha Abd Razak, said the collaboration was expected to materialise by year-end. “We have established a working committee for the collaboration. We plan to offer our remittances and withdrawals services in Indonesia, which will benefit the people from both countries,” he said.
BOT governor race nears finish line The Nation 19th Jun 2015
Ahead of the Finance Ministry's nomination of the Bank of Thailand governor, the odds are strongly in favour of Veerathai Santiprabhob being the next person to run the country's most prestigious economic institution. Sources say the selection committee has given him the highest score than the four other applicants: Paiboon Kittisrikangwan, a deputy central bank governor; Tongurai Limpiti, also a deputy central bank governor; Supavud Saicheua of Phatra Securities; and Kiatchai Sophastienphong, a former central bank official. Veerathai brings with him an excellent academic record and work experience. Having worked for the International Monetary Fund and with master's and doctoral degrees from Harvard University, he was a former executive of Siam Commercial Bank and executive vice president of the Stock Exchange of Thailand. He is now a member of the BOT's Court of Directors and a member of the "superboard" established by the junta to revamp state enterprises.
Foreign investors eye stake in Vietnamese banks VietNamNet Bridge 19th Jun 2015
Though Vietnamese banks are undergoing a compulsory restructuring process, foreign investors are showing interest in purchasing stakes in banks. VinaCapital’s managing director Andy Ho said that foreign investors are seriously interested in banks’ bad debts. The bank restructuring and pressure on banks to settle bad debts offer great opportunities for investors to buy Vietnamese banks. An analyst said it was now the right time for investors to inject money into Vietnamese banks. Though the national economy has not fully recovered, the shares of banks with good performance have been increasing in price.
OJK: Bank Profits Down in April Amid Slow Loan Growth Jakarta Globe 19th Jun 2015
Indonesian banks posted a slight decline in profit up to April 2015, at Rp 36.8 trillion ($2.7 billion), on the back of slow loan growth, according to the Financial Services Authority, or OJK. According to OJK records, banks’ profits since January declined 0.65 percent year-on-year from Rp 37.1 trillion. While banks’ profit grew 4.25 percent in March, banks posted a 13.6 percent growth in profit from January to April 2014. “This is an effect of slowing loan growth and of worsening credit quality,” Nelson Tampubolon, the OJK’s banking supervision executive director, said on Thursday. Non-performing loans grew 2 percent to 2.5 percent in April compared to the same period last year.
Commercial banks to raise ratio of highly liquid assets Bangkok Post 18th Jun 2015
Commercial banks must beef up their highly liquid assets to meet the minimum liquidity coverage ratio (LCR) requirement of 60% from next Jan 1. The Bank of Thailand requirement is to ensure that banks can manage liquidity if a financial crisis breaks out. A rise in 10-percentage-point increments each year until the 100% requirement is reached in 2020 is a must, said Somboon Chitphentom, a senior director of the regulatory policy department at the central bank. The Basel III LCR rule requires banks to maintain a minimum amount of liquid assets to withstand cash outflows over a 30-day horizon.
Bankers Give Mixed Response Towards BI Rate Tempo 18th Jun 2015
Some bankers hoped that the Bank Indonesia (BI) interest rate will decrease as liquidity increases. However, there are others who projected that the BI rate will remain on the 7.5 percent level. PT Bank Central Asia president director Jahja Setiaatmadja said that the slightly pressured Rupiah will cause the BI rate to remain unchanged. Similar with Jahja, PT Bank OCB NISP president director Parwati Surjaudaja, projected that the BI rate will not be changed. On the other hand, PT Bank Bukopin president director Glen Glenardi expected the BI rate to decrease as the market's liquidity remains considerably high.
New regional branches ahead of ASEAN convergence Nikkei Asian Review 17th Jun 2015
Two weeks after opening its first branch in Myanmar, Bangkok Bank (BBL) reopened its Cambodia branch on Monday as it strives to get ahead of rivals before the ASEAN Economic Community (AEC) gets going at year's end. BBL's two new full-service branches bring the bank's total overseas to 30 in 14 economies, with its largest foothold in China. In Cambodia, BBL expects Thai corporate customers and their employees to be its main clients. It is also looking to do business with local companies wishing to expand abroad by leveraging the bank's international network. BBL had pulled out of the country in 2000 after reserve requirements were increased by the Cambodian central bank.
Bangkok Bank opens first branch in Cambodia ASEAN Investor 16th Jun 2015
The Thai Bangkok Bank has opened a new branch in Cambodia with full financial services for Thai and foreign customers. The new bank also targets local clients, clients’ trading partners, foreign investors and Cambodian businesses. The new branch in Cambodia, managed by Yiamsri Ubonpong opened yesterday after the National Bank of Cambodia granted it a licence to operate in December, and it will provide services such as deposits, business lending, trade services, foreign currency transfers and currency exchange services, according to a press release. “During the past 10 years, Cambodia’s economy has had an average real growth rate of 7.9 per cent and is expected to grow by an average of 6.7 – 7.4 per cent over the next three years as regional trade and investment expands after the ASEAN Economic Community (AEC) is formed at the end of 2015,” Bangkok Bank President Chartsiri Sophonpanich said.
Moody's ratings unchanged for Vietnam’s banks VietnamPlus 16th Jun 2015
Moody's Investors Service last week assigned its new bank rating methodology of Counterparty Risk Assessments (CR Assessments) to nine Vietnamese banks. However, credit ratings assigned to these nine Vietnamese banks remain unchanged. According to Moody's long-term CR Assessments, it has given B1 (CR) to Vietnam Bank for Industry and Trade (Vietinbank) and Bank for Investment and Development of Vietnam (BIDV), while B2 (CR) has been assigned to Asia Commercial Bank (ACB), Military Commercial Joint Stock Bank (MB), Saigon-Hanoi Commercial Joint Stock Bank (SHB), Saigon Thuong Tin Commercial Joint-Stock Bank (Sacombank), and Vietnam Prosperity Joint Stock Commercial Bank (VP Bank), as well as Vietnam Technological and Commercial Joint Stock Bank (Techcombank) and Vietnam International Bank (VIB).
Thailand Seeks New Central Bank Head With Economy in Trouble Bloomberg 15th Jun 2015
A former International Monetary Fund economist, a woman and a central banker who defended the baht before it was floated 18 years ago are among the likely candidates to be the new governor of the Bank of Thailand. Five applicants have met the criteria of the central bank’s selection committee, which will propose at least two names to the finance minister by July 2 after interviews on Tuesday, according to Krisda Chinavicharana, head of the finance ministry’s Fiscal Policy Office. Once he makes his choice, he will seek the Cabinet’s approval, after which the prime minister gets the King’s endorsement.
E-Payments
Nearly half of Asians shop on smartphones Nikkei Asian Review 22nd Jun 2015
As more Asians turn to smartphones, "shopping on the go" is becoming a regional trend. Close to half of such device users in the Asia Pacific have used mobile shopping services, according to a survey by MasterCard. The survey, conducted between October and December 2014, revealed that 45.6% of smartphone users in 14 markets in the Asia Pacific had used their mobile devise to buy goods or services during the preceding three months. The number has been growing steadily since the credit card company's first survey in 2011, when the result was 26.8%. China led the pack at 70.1%, followed by India at 62.9% and Taiwan at 62.6%. Figure for Southeast Asian countries were also strong -- Thailand ranked fourth with 58.8% and Indonesia 54.9%. Phenomenal growth was seen in India, Taiwan and Malaysia, where the percentages showed double-digit growth over the past year.
Insurance
Vietnam: Insurance authority to improve regulations for brokers Asia Insurance Review 22nd Jun 2015
The legal framework for the operation of insurance brokerage companies will be improved to enhance competitiveness and promote development of the insurance market, according to the Insurance Supervisory Authority (ISA) under the Ministry of Finance. ISA said that a regulation to allow insurance brokerage firms to offer consultancy services will be taken up for consideration and would be in line with international practices, reported the Vietnam News Agency. ISA Director, Mr Phung Ngoc Khanh, said at a conference last week that insurance brokerage is becoming an important factor for the development of the insurance market as well as the country's socio-economic development.
Health insurance to begin as a tough sell Myanmar Times 22nd Jun 2015
A Health insurance plan set out by the government is scheduled to start next month, though initial uptake may be show. Private insurers say the one-year test phase will be spent identifying whether it is viable and convincing consumers of its benefit. The long-promised health insurance program was introduced earlier this month by deputy finance minister U Maung Maung Thein, and is slated to start on July 1. The program has relatively rigid conditions, and private insurers say the primary challenge will be to convince potential users that it is worthwhile. “We need to explain it to people, so they can gain knowledge. We can persuade people to insure if they know the benefits of insurance,” said U Aung Soe Oo, general manager at IKBZ. “If they insure, they will cover their losses.”
Phl insurance market still smallest in Asean The Philippine Star 21st Jun 2015
The Philippine insurance market remains the smallest among the five largest economies in the Association of Southeast Asian Nations (Asean-5) in terms of assets and premiums, based on a recent study of the United States Agency for International Development (USAID). USAID’s Advancing Philippine Competitiveness (COMPETE) project found the insurance markets in the Asean-5 appear to be the least developed. But among the Asean-5, composed of Indonesia, Malaysia, Philippines, Singapore and Thailand, the Philippines had the smallest insurance market. The Philippine life insurance market is worth $16.6 billion in assets and $3.8 billion in premium earnings.
Insurance sees slow business amid economic contraction Jakarta Post 19th Jun 2015
The general insurance industry reported a lackluster performance in the first quarter of the year, triggered by the economic slowdown. According to the latest data released by the General Insurance Association of Indonesia (AAUI), the general insurers posted 9.8 percent growth year-on-year in terms of gross premiums to reach Rp 13.97 trillion (US$1.05 billion) in the January to March period. It was a steep drop compared to the first quarter of 2014, when the companies managed to book 19.6 percent annual growth. AAUI executive director Julian Noor said ongoing economic contraction — with 4.7 percent gross domestic product (GDP) growth recorded in the first quarter — had played a part in the result.
Could over-regulation kill ecommerce in Indonesia? Tech in Asia 19th Jun 2015
It looks like the ministry of trade is about to introduce regulations that would make it more difficult to participate in ecommerce – especially for small players. Budi Gandasoebrata, vice chairman of iDEA, told us the ministry of trade is withholding the draft concerning electronic trade. The draft is now due for public review, but has not been made available to the stakeholders, including iDEA. Invites to a public review of the draft were sent out with only one day’s advance notice. At that meeting, which took place yesterday, the draft itself was only shown briefly on screen, Budi told me. Ministry representatives promised to send “material” (not the draft itself) to stakeholders for review, but it’s unclear what options there are to take influence.
Private Health Insurance Gets Government Green Light The Irrawaddy 16th Jun 2015
Burma’s premier insurance providers will begin offering health coverage on July 1, beginning a one-year pilot project approved by the Ministry of Finance. Eleven licensed private insurers will soon offer coverage at a standard rate of 50,000 kyat (US$45) per unit per year with a maximum of five units. All healthy citizens between the ages of 6 and 65 years will be eligible during the first year trial. “We will adjust the health insurance regulations during this first year,” Deputy Finance Minister Maung Maung Thein told reporters on Monday. Initial policies contain some restrictions on eligibility and applicable services, the deputy minister said. Coverage will not extend to abortion, child delivery, dental, eye or cosmetic surgery, and treatment for mental illness and drug addiction will be exempt.
Market Regulation
Widodo to Submit Financial Safety Net Bill to House Tempo 22nd Jun 2015
The government and financial regulators and authorities are drafting the Law on Financial System Safety Net (JPSK bill). Bank Indonesia Governor Agus DW Martowardojo said once the draft is ready, it will be submitted by President Joko Widodo to the House of Representatives (DPR). The law is prepared to protect Indonesia from possible crises in the financial sector. Earlier, chairman of the National Commercial Banks Association (Perbanas) Sigit Pramono said he hopes that the JPSK bill will soon be included in the list of items to be discussed by the national legislation program (prolegnas) team this year.
Call for higher ceiling on SMEs loan guarantee The Nation 19th Jun 2015
The Thai Bankers' Association (TBA) has called on the Office of Small and Medium Enterprises Promotion to raise the guarantee ceiling provided by the Thai Credit Guarantee Corporation (TCG) from 18 per cent to 30 per cent of a loan or credit line for only a one-year period to support SMEs during the sluggish economic recovery. The TBA is also seeking assistance - only for industries with good potential - to provide adequate liquidity for business operations and to curb the high missed loan repayment rate of 4.5 per cent by local SMEs in the first quarter of this year. Boontuck Wungcharoen, chairman of the TBA and chief executive officer of TMB Bank, said yesterday that the 18-per-cent cap may seem adequate to the Finance Ministry, but the economy has not improved sufficiently to lessen the financial burden of the one million local SMEs that need over Bt4 trillion in loans from commercial banks to keep them in business during the current slowdown.
Fortified insurer RBC framework begins to bite in 12 months Business Mirror 19th Jun 2015
The Insurance Commission (IC) aims to implement in full by June next year a fortified version of the risk-based capital framework, or RBC 2, for the nation’s insurers that will determine the amount of capital they must keep depending on the risks they take. Insurance Commissioner Emmanuel F. Dooc issued Circular Letter 2015-31 that set the implementation date of the fortified framework beginning June 30, 2016, and requiring all insurance companies to participate at trial runs scheduled over the next six months. For now, the IC is reviewing the existing RBC framework, which requires insurance companies to put up additional capital depending on the risks they have undertaken, aside from the mandatory capital they should have as provided for in the amended Insurance Code.
Credit card firms urge BOT to clarify terms of DSI's interest-rate proposal The Nation 18th Jun 2015
Credit-card and personal-loan providers have asked the Bank of Thailand to discuss with the Department of Special Investigation (DSI) the proposed new Interest Rate Act, which is creating confusion for them. The DSI said on Tuesday that it was proposing that the Justice Ministry revoke the outdated law and replace it with a new version that provides harsher penalties against lenders charging borrowers more than 15-per-cent interest. The DSI noted that the interest rate would cover fees and service charges related to debt collection. The new law would also apply to credit-card operators in the financial system, not just non-financial institutions.
Central Bank Eases Forex Access for Importers of Some Commodities The Irrawaddy 18th Jun 2015
The Central Bank of Myanmar will allow the unrestricted sale of foreign currencies at official rates to importers of edible oil, fuel and cement, rolling back a policy that had limited withdrawals in an apparent bid to ward off supply shortages and a rise in the commodities’ prices. The state-run Global New Light of Myanmar on Thursday quoted Central Bank Deputy Governor Sett Aung as saying the lifting of restrictions was also “intended to prevent unwanted hikes in foreign currency rates.” The report said government-owned Myanma Economic Bank and Myanmar Investment and Commercial Bank would begin the plan starting on June 17. However, industry sources said some private banks would not begin until next week.
BSP allows stand-alone trust firms Manila Standard Today 18th Jun 2015
The Bangko Sentral ng Pilipinas (BSP) has approved the establishment of stand-alone trust corporations, earlier only allowed to operate as departments within banks. BSP Governor Amando M. Tetangco Jr. told reporters the move was welcomed by banks given the benefits they would enjoy by putting up a trust institution instead of having it within their firms. These stand-alone trust corporations will have lower supervision fees, no reserve requirements, no single borrower’s limit (SBL) and no cap on the directors, officers, stockholders, and their related interests’ loan (DOSRI), Tetangco said.
Govt Promises to Finalize Pension Insurance Rule Next Month Tempo 15th Jun 2015
Coordinating Minister for the Economy Sofyan Djalil said the rule on pension insurance will be completed before July 1. However the minister declined to disclose the amount of premium for the BPJS Employment's pension program. The premium rate has caused debate among lawmakers, regulators and industry players. Most employers refused the BPJS Employment's premium rate proposal of eight percent from workers' monthly salary. Five percent of the premium will be paid by employers and the three percent will be paid by employees. Chamber of Commerce and Industry chairman Suryo Bambang Sulisto has asked that the BPJS pension premium rate does not burden employers. Suryo fears that an eight percent rate is too high amid the current economic slowdown.
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