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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 the completion of remaining formalities, Bank of Baroda will approach Bank Negara Malaysia for regulatory approvals to set up a banking company, Mallya said. The subsidiary 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.