| BoB, IOB, Andhra Bank to set up subsidiary in Malaysia | |
| Press Trust of India / Mumbai June 4, 2009, 16:40 IST | |
Public sector lenders, Bank of Baroda (BOB), Indian Overseas Bank (IOB) and Andhra Bank have signed a joint venture agreement for setting up India BIA Bank (Malaysia) Bhd, a banking subsidiary in Malaysia.
"The three-public sector banks will invest Rs 405-crore to set up subsidiary in Malaysia. Bank of Baroda will invest 40 per cent, Indian Overseas Bank 35 per cent and Andhra Pradesh 25 per cent," Bank of Baroda Chairman and Managing Director M D Mallya told reporters here today.
"We have obtained necessary approval from Reserve Bank of India (RBI) for setting up the subsidiary in joint venture with other two banks and this has also been appraised to Bank Negara Malaysia. After completion of remaining formalities, Bank of Baroda will approach Bank Negara Malaysia for regulatory approvals to set up a banking company, Mallya said.
The subsidairy will be serving the banking needs of all sections of population and corporates in Malaysia. The initial target group will be Indian corporates and ethnic Indian population.
"With Bank of Baroda having extensive network in central and northern India and IOB and Andhra Bank in the southern parts of India, the subsidiary in Malaysia will be able to attract tech expatriate population who has migrated to Malaysia from different parts of India," Mallya said.
Bank of Baroda opened its representative office in Malaysia in 2004. With BoB and IOB already having presence in Malaysia for some years through representative office have studied the market well and are well aware of the available opportunities for business development.
Bank of Boarda has extensive presence in the area with branches in Hong Kong, China, Singapore and representative office in Thailand with full fledged branch operations in UAE.
Malaysia has strong trading ties with these countries and the presence of Bank of Baroda will help in providing trade related services to the customers of the subsidiary. This will also help garnering the business for the subsidiary.
India's trade with Malaysia increased by 84.32 per cent in FY07 and 30.07 per cent in FY08. During FY08, the trade between India and Malaysia was $8.58 billion and this provides an excellent opportunity for canvassing trade related business for the proposed subsidiary, Mallya said.
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