The Industrial Bank of Korea has clinched a partnership with Myanmar’s SME policy headquarters as part of its blueprint to expand business in the Southeast Asian region, officials said Tuesday.

The South Korean state-run bank and the Myanmar MSME Development Working Committee signed a memorandum of understanding at Lotte Hotel Busan on Monday.

Under the latest agreement, the two organizations vowed to cooperate to nurture small and medium-sized enterprises in both countries and develop joint policy finance projects.

The Myanmar side’s working committee, led by Vice President U Myint Swe, is affiliated with the SMEs Development Central Committee chaired by President U Win Myint.

“Myanmar, along with Vietnam, has the greatest growth potential among the countries on the Indochina Peninsula,” said an IBK official.

“Our latest partnership seeks to contribute to the SME development of both countries, as well as the (Moon Jae-in) government’s New Southern Policy.”

IBK currently operates an office in Yangon, which it is planning to turn into an official branch or local subsidiary. Its business in Myanmar complements the IBK Asia Financial Belt, a project to create a banking network that connects China and Japan with Vietnam, the Philippines, Cambodia and other ASEAN states.

Reflecting its initiative in the Southeast Asian state, IBK held an investment briefing in May for Korean firms eyeing business expansion in Myanmar. Also, in September, the bank signed a memorandum of understanding with the Korea Trade-Investment Promotion Agency and the Korea Land and Housing Corporation to jointly support Korean firms operating in Myanmar.

By Bae Hyun-jung (tellme@heraldcorp.com)