Singaporean multinational banking entity, the United Overseas Bank (UOB), is closing five bank accounts held by MAI - Myanmar Airways International (8M, Yangon), according to a leaked June 25 letter written by MAI CEO Saravanan Ramasamy.
UOB stopped depositing cash and/or cheques into the accounts from July 1, and is now limiting electronic deposits. The bank will stop processing payments from the accounts on July 21, with all five accounts closing on August 15. At that time, UOB will remit any remaining funds back to the airline. According to Ramasamy, the bank facilitated the lengthy timeline to allow MAI time to make alternative financial arrangements.
"Despite our appeal to maintain the bank account, UOB has remained firm in closing the account," the letter said. Owned by Aung Aung Zaw, a Myanmar national with alleged close ties to the country's ruling military junta, MAI operates a fleet of ten aircraft, including four A319-100s, three A320-200s, one ERJ 190-100AR, and two ERJ 190-100LRs, to 26 destinations in 11 countries, including Singapore.
The leaked letter does not explain why UOB is shuttering the accounts but the move follows a recent United Nations report that named the bank as one of three Singaporean financial institutions used by arms dealers doing business with Myanmar's military junta. The report also said that the junta has imported around USD1 billion worth of weapons and components since 2021 and that all three banks hold "substantial reserves" of cash connected to Myanmar.
Aung Aung Zaw also owns Air KBZ (Yangon) and is the chairman of the 24 Hour Group of Companies. According to regional media reports, MAI and the Myanmar Air Force (Yangon) now share aircraft, including operating flights to Russia, where the aircraft are allegedly used to ship arms. MAI is also the airline of choice for Myanmar's ruling elite, who use its planes to fly to key regional cities like Singapore for shopping, banking, and medical purposes.
While Singapore has not implemented any widespread trade ban on Myanmar, its authorities did ask its banks to exercise greater due diligence in the wake of the report. Ramasamy's letter indicates the airlines used the UOB accounts to transfer payments to and from lessors and suppliers and that the airline provided the bank evidence to support this. The ch-aviation fleets ownership module reveals that eight leasing entities have aircraft placed with MAI namely AerCap, Aviation Capital Group, Avolon, Carlyle Aviation Partners, CDB Aviation, DAE Capital, Meritz Securities, and TrueNoord.
The Myanmar NOW outlet also reports that in response to the UOB account closures, MAI is opening new bank accounts at the Development Bank of Singapore, Thailand’s Kasikorn Bank, and Dubai’s Emirates NBD. The Development Bank of Singapore was one of the three banks named in the UN report. In a statement, that bank says it screens new customers for probity concerns, including any possible sanction breaches, during the account opening process.
