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Myanmar Banks Urged to Comply with New Risk Management Guidelines by May 2021

The Central Bank of Myanmar has issued guidelines for banks in the country to ensure effective risk management practices, with a deadline of May 20, 2021, to implement the new regulations. The guidelines aim to strengthen the banking sector’s resilience and stability by promoting sound risk management systems.

Key Requirements

Develop risk appetite frameworks
Establish risk governance structures
Maintain adequate monitoring and management information systems
Emphasize internal controls, stress testing, and external audits
Approve risk appetite frameworks and comprehensive risk strategies by the Board of Directors
Establish a Risk Management Committee chaired by an independent non-executive director
Implement a rigorous stress testing framework

Seven Key Financial Risks to Manage

Credit risk
Market risk
Liquidity risk
Operational risk
Legal and regulatory risk
Strategic risk
Group and related parties risk

Consequences of Non-Compliance

Failure to comply with the guidelines will result in corrective actions or sanctions
Administrative penalties may also apply

Implementation Advice

Implement compliance software solutions to ensure seamless adherence to the new regulations
Minimize the risk of non-compliance by implementing these measures

Deadline: May 20, 2021

Banks that fail to comply with the guidelines by the deadline may face severe consequences. It is essential for banks in Myanmar to take immediate action to implement the new risk management guidelines and ensure compliance with the Central Bank’s regulations.