THE Myanmar Industrial Development Bank has reported an increase
in profits for 2006-07 as lending grew despite a fall in deposits.
Profits more than doubled during the last financial year, which
ended March 31, to K896.7 million from K386.4 million in 2004-05,
according to the bank’s annual report, released at the MIDB’s
12th annual general meeting on May 19 in Yangon.
Deposits, however, declined 14 percent to K9.735 billion from
K11.352 billion the previous year.
Lending held relatively steady with an increase of 0.6pc to
K7.635 billion in 2006-07 from K7.585 billion, the report said.
“The ratio of deposits to loans at the MIDB stood at 78.4pc
in the 2006-07 financial year,” Major General Saw Lwin,
the chairman of the Myanmar Industrial Development Committee,
said in a speech.
This represents an increase from 66.8pc in 2005-06 but remains
below the Central Bank’s ruling that loans not amount to
more than 80pc of deposits.
Maj-Gen Saw Lwin, who is also Minister of Industry (2), said about
65pc of loans during the previous year went to the industrial
sector – to which the MIDB has granted priority.
“One of the reasons why the bank enjoyed more profit last
year is that it increased its remittance services with other banks
across the country and increased its lending.
“As the profit went up last year, we are going to use
it to reinvest in our business. In 2007 we will open new branches
in Nay Pyi Taw and Monywa,” Maj-Gen Saw Lwin said.
Eighteen percent of net profits would be paid out as dividends
to shareholders, according to the MIDB’s annual report.
In other good news for the bank, Maj-Gen Saw Lwin said the rate
of non-performing loans (NPL) had fallen and was well below the
10pc maximum mandated by the Central Bank.
“The NPL rate at our bank declined from 2.89pc in 2005-06
to 2.74pc in the 2006-07 financial year,” he said.
The bank’s 51 non-performing loans amounted to K126 million
for the year, the annual report said.
The Ministry of Industry (2) set up the Myanma Industrial Development
Bank in 1996 to provide financing to the industrial sector. It
has so far issued 3200 shares to the public and has three branches;
one each in Yangon, Mandalay and Meikhtila.
MIDB general manager U Thein Muang said the bank would pay K184
million in tax for the 2006-07 financial year.
