China and India bank applies for licenses in Australia

AgBank, BoCom, Bank of Baroda, and Union Bank of India among the ten international banks to exploit Australia’s booming mining and resources industry.

Around ten banks, including lenders from resource hungry China and India, are seeking bank licenses in Australia to tap into rising cross border M&A and infrastructure financing, as local banks struggle with new capital and liquidity rules.

China's Agricultural Bank of China and Bank of Communications, Madrid-based Banco Bilbao Vizcaya Argentaria (BBVA) and Indian lenders Bank of Baroda and Union Bank of India are among banks that are awaiting regulatory clearance, the banks told Reuters.

"The big driver for us in applying for a banking licence in Australia is project finance," said Jonathan Grosvenor, BBVA's managing director and head of corporate clients Asia Pacific.

"We are targeting to be a tier one banking service provider to clients in Australia."

Several other lenders have also submitted applications and are awaiting regulatory approval, according to sources familiar with the situation.

The sources declined to be identified as they are not authorised to speak to the media. Banking regulator APRA declined to comment.

Banks are flocking to Australia as they follow clients who are acquiring assets in the country's vital mining sector and spend heavily to expand mining operations.

View the full story in Reuters.