CB Bank
For a country where approximately 90% of the population is unbanked, Myanmar is flush with banks. But the sector is dominated by just a handful of private institutions. Among them, CB Bank is the most impressive, with a strategy that targets retail, SMEs and corporations, and gaining strength from an intriguing digital approach.
Founded in 1992, the bank is a veteran in the market and the oldest among the top ranks, given that many of its rivals were only established after a run on the banks in 2003. But CB Bank, led by chief executive U Kyaw Lynn, keeps up with the times.
It introduced mobile banking in 2014 and its CB Pay app in 2018. Through its smartphone-based platform it is targeting businesses with point-of-sale technology, appealing to consumers with the ease of a tap-and-go payments system.
The potential goldmine of data produced by its mobile services is not lost on the bank, which has a team of analysts to spot trends and opportunities. And instead of entering the saturated mobile electronic-wallet market with a propriety product, it has partnered with telecoms company Ooredoo to link its bank accounts with the firm’s e-wallet app, launched in 2017.
Though its roots are in retail, CB Bank has developed a strong corporate client base. Its corporate lending accounted for 90% of its outstanding loans last year. The bank had a loan book of K7.57 trillion ($5.5 billion) in 2019, an increase of 19% year on year. Deposits were up 32% on the year. Small and medium-sized enterprises and retail lending made up 7% and 3% of its book, respectively.
CB Bank unveiled a supply-chain financing service at the end of 2019 that allows buyers to optimize working capital by extending the trade payable cycle and lets suppliers generate additional operating cash flow. This has attracted domestic corporate clients and multinational conglomerates, minimizing supply-chain risk and freeing up cash.
As Myanmar opens up, more foreign banks are entering the market. While some local firms are concerned about the competition, CB Bank is embracing the opportunity to establish partnerships so that it can gain access to overseas clients.
It has already partnered with Singapore’s OCBC and with State Bank of India to introduce export financing for its own clients while opening the door to their customers doing business in Myanmar.
CB Bank is using its corporate relationships to expand its reach, offering bank account services to corporate clients’ employees, suppliers and vendors. It is a smart approach to growth, when the average person or small business in Myanmar borrows from neighbours and keeps cash under the mattress.
For example, alongside providing payroll and cash-management services, the bank also offers bank account services, mobile banking and internet banking services to employees.
Among the clients it has secured is Singaporean ride-hailing giant Grab, helping its drivers to open new bank accounts with mobile banking services, ATM cards and consumer loans.
The bank is boosting its SME customer base, nearly doubling the number of active borrowers from 1,665 to 3,000 last year, while its loan portfolio for the segment jumped from K324.3 billion to K530 billion.
In 2017 CB Bank became the first in Myanmar to issue credit cards, for retail and corporates, and has since partnered with well-known brands to help expand its reach, including Manchester United Football Club, a popular team in this frontier nation.
Myanmar is still very focused on cash, making collections and payments processes cumbersome. To capture opportunities there, the bank has expanded its ATM network and opened 25 new branches across the country; it plans to open more this year.
CB Bank provides cash-management products such as electronic and paper-based payments, receivables and liquidity management solutions, and electronic delivery channels to corporate clients, multinational conglomerates, non-governmental organizations, foreign embassies and financial institutions.