Exclusive interview with Yoma, a bank with one of the highest cost to income ratio globally

Yoma Bank restarted operations under a full banking licence in 2013. It now stands amongst the top ten banks in Myanmar in terms of total assets.


On 25 September 2017, Yoma Bank implemented Fusion Treasury. The technology delivers intuitive and personalised solutions for its treasury clients.

“Fusion Treasury, powered by Opics, significantly increases Yoma Bank’s capabilities to provide better solutions for our clients and at the same time further enhances our core strengths of optimal risk management and adequate controls”, said Vijay Maheshwari, Yoma Bank CFO. With the Fusion Treasury system, the bank will be able to provide a front-to-back-office processing system for money market and FX solutions.

Yoma Bank needs to take steps to lower the cost to income ratio

Interest rates in Myanmar are capped by regulations. The risk-adjusted net interest margins remain challenged. As a result, Yoma Bank has a cost to income ratio of up to 75%, a much higher ratio when compared to the top banks in ASEAN.

Sources: DBS, OCBC, UOB, Star, FMI

A change of interest rate regulations will help Yoma Bank to appropriately adjust its business model. Meanwhile, Yoma Bank hopes investments in technology and human capital to deliver its business strategy, thus reducing costs.

“Given that Myanmar’s banking sector is in a somewhat nascent stage and Yoma Bank is on a growth trajectory, our primary focus remains on offering relevant and accessible products and services for new and existing customers”, said Yoma Bank manager. More need to be done to lower the cost to income ratio.

Will Yoma Bank consider M&A strategies?

Yoma Bank is a fraction of the size of other top banks in Myanmar such as Kanbawza Bank, and Myanmar Foreign Trade Bank. Even so, Yoma bank is least likely to consider M&A strategies to leapfrog growth. “We plan to continue leveraging the latest technology platforms to offer relevant banking products and services to existing and new customers across the country. The process is currently underway, and we expect to start seeing the results of this focus in the near term”, Yoma Bank manager stated. It has a defined organic growth strategy in Myanmar. The low banking penetration rate in Myanmar offers significant growth potential.

Yoma bank’s net customer loans grew from US$740,000 in 2013 to US$740 million in 2017. The bank’s growth was in line with its business strategy of offering relevant product and services for Myanmar’s consumers and SMEs. The growth was also related to the general increase in the banking penetration rate of the country’s population.

Yoma Bank’s technology roadmap

Yoma Bank is in the process of building a technology architecture in line with its business strategy. It leverages high mobile penetration and wide internet usage.

Yoma Bank has deepened the partnership with Finastra, leveraging its open software architecture to connect to a wider ecosystem of partners and innovation. Yoma Bank aims to become part of a larger ecosystem, which will likely involve opening up the APIs to enable further development of Myanmar’s emerging digital community.