Barclays, Societe Generale and ABN AMRO are amongst those taking advantage of the opening.
Reuters reports that a growing number of foreign banks are lining up to grab at a chance at Australia’s $3.5t banking market whilst the country’s local banking players are fending off a damaging inquiry from a high-level banking commission.
Barclays is reportedly plotting a return to the market after exiting two years ago whilst Societe Generale is said to be planning to re-open a branch. Dutch lender ABN AMRO is expecting to launch onshore banking operations in the second half of the year whilst Italian bank Intesa Sanpaolo is mulling a branch.
The move comes as local lenders, Australia and New Zealand Banking (ANZ), Commonwealth Bank of Australia, National Australia Bank (NAB) and Westpac, which collectively account for 79% of the local market, are reeling from an inquiry by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry which revealed a slew of unethical practices and rampant industry malpractice at the country's financial services sector.
Banks are facing stricter conditions on retail borrowers as a result of the hearings whilst top-level executives have been leaving sinking ships in the fallout.
“I suspect the primary issue will be potential distraction of senior management towards the inquiry and that may mean that they are not as focused on the business as they might have been,” said Peter Davis, executive director for Asia Pacific corporate and institutional banking at ABN AMRO.
The entry of new competition has been said to be encouraged by Australian regulators themselves to chip away at the dominance held by the local financial heavyweights.
Here’s more from Reuters:
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