United Amara Bank (UAB) and the Asian Development Bank (ADB) have signed a trade finance agreement that will allow UAB to provide greater financial support for trade in Myanmar through guarantees by ADB up to $ 4 million a year. The agreement has been extended as part of the ADB’s Trade Finance Program (TFP), which works with over 200 partner banks worldwide and will allow UAB to take advantage of ADB’s AAA credit rating. According to the terms of agreement, ADB will provide what is known as a Trade Guarantee Facility to UAB to support international Letters of Credit (LC) issued by the bank. This means that when a Foreign Letter of Credit,or LC, is issued by UAB for one of its customers, and where the foreign party requires an additional guarantee or confirmation, ADB will provide that guarantee.
Local businesses who are the customers of UAB will be able to make use of LC from August 15. They will need to show document evidence of their business and if necessary, the recommendation from Ministry of Trade and Commerce, if they want letter of credit from the bank.
The agreement was concluded during a signing ceremony at Sedona Hotel in Yangon attended by officials from UAB, representatives from ADB as well as several honored guests. This marks the first step in a long-term partnership for UAB and ADB to assist trade financing for local businesses in Myanmar and ultimately help boost the Myanmar economy. UAB CEO Thein Lwin said that the partnership with ABD is an “important milestone” for them and it will “greatly benefit the people of Myanmar.”
