TOKYO -- A subsidiary of Mitsubishi UFJ Financial Group will open a representative office in Myanmar as early as July in a first for a foreign leasing business, possibly paving the way for broader use of equipment and cars from Japanese manufacturers.
Legislation enacted in January allows foreign nonbank financial institutions to do business in the Southeast Asian nation. BOT Lease, which recently got the green light, will set up an office in Yangon and begin market research.
The company seeks approval from Myanmar's central bank to begin leasing, which involves a separate application process. It will essentially be the first entrant in the country's leasing market, with next to no domestic players in the industry.
BOT Lease plans to bring cars, construction equipment and information technology devices from such sources as Thai plants run by Japanese manufacturers. Myanmar's leasing market is seen reaching several hundred billion yen, equivalent to billions of dollars, over the next five years as progress is made on such infrastructure as roads and airports. BOT Lease will partner with Myanmar's Co-operative Bank to grow its business faster.
A number of foreign companies have expanded into Myanmar since the transition to democracy began in the spring of 2011, drawn there by a population exceeding 50 million and sustained economic growth of around 7-8%. MUFG unit Bank of Tokyo-Mitsubishi UFJ opened a Yangon branch in April 2015, becoming the first foreign bank to do so. The bank plans to work with BOT Lease to expand its financial business, as well as to broaden the group's Myanmar operations.
Established by the old Bank of Tokyo, BOT Lease has a strong presence overseas. It set up shop in Thailand and Indonesia in the 1980s and '90s.