>> India's Bank of Baroda granted licence to operate in Malaysia
||18 April 2010
India's Bank of Baroda granted licence to operate in Malaysia
Malaysia's finance ministry has issued a commercial banking licence to one of India's largest banks, Bank of Baroda, the country's central bank announced Friday, reported AFP.
"The Minister of Finance has approved the issuance of a commercial banking licence to a locally incorporated company to be established by Bank of Baroda (40 percent), Indian Overseas Bank (35 percent) and Andhra Bank (25 percent)," Bank Negara said in a statement.
The issuance of the licence comes as Malaysia and India edge closer to signing a free-trade agreement by year end.
"The presence of the new Indian commercial bank will further strengthen the economic and financial linkages between Malaysia and India," the central bank said.
"In addition, it is expected to contribute towards the overall development of a more diversified financial sector in Malaysia," it said. Trade between the two countries peaked in 2008 at $10.52 billion but fell to $7.06 billion in 2009 on the back of the global economic downturn.
In April last year, Malaysia announced measures to liberalise the country's banking sector, allowing nine new banking and insurance licences and easing foreign ownership limits for non-commercial banks.
Malaysia has issued 15 licences for commercial banking and six for Islamic banks to foreign operators to date, including one in November to the Industrial and Commercial Bank of China.
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