Axis, Union Bank among 5 new entrants to UK banking space

Two banks from India - Axis Bank and Union Bank - are among the five new entities authorised to do banking business in the UK during the last fiscal, as per latest statistics released by the British regulators.
In the 12-month period, following the changes introduced by the UK regulators to reduce barriers for entry of new financial institutions, five new banks have been authorised out of which two are Indian.
The five banks authorised between April 1, 2013 and March 31, 2014 are Axis Bank UK Ltd, Union Bank of India (UK) Ltd, FCMB (UK) Ltd, UBA Capital (Europe) Ltd and Paragon Bank plc.

Other Indian banks present in the UK include ICICI Bank, SBI, Bank of Baroda, Canara Bank, Syndicate Bank and Bank of India, among others.
As many as 30 new banks could open in the United Kingdom following changes introduced by the UK regulators to reduce barriers for entry of new financial institutions.
There has been a substantial increase in the number of firms discussing the possibility of becoming a bank with the regulators, an official release said, adding in the twelve months to March 31, 2014 the regulators held pre-application meetings with over 25 potential applicants.

Last April, the Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) had put in place certain changes to reduce the barriers to entry for new financial institutions to enable increased competition in the banking industry and to the benefit of customers.

The changes focused on two key areas: simplification of the authorisation process for new banks; and a major shift in the prudential regulation, such as capital requirements, for new entrants.
"It is clear that the changes introduced last year have been positive for new entrants and will make a contribution to increasing competition and thus benefit customers," Andrew Bailey, Chief Executive of the PRA, said.
Martin Wheatley, Chief Executive of the FCA, said, "The changes will ultimately offer consumers greater choice and encourage innovation. I'm keen we maintain this progress, and want to see greater competition in retail banking work for the benefit of consumers.