Overseas banks eye Australian entry
(24 May 2012 – Australia) Banking industry sources named several overseas banks, mainly from the Middle East and Asia that are eyeing an entry to the Australian market.
The sources told The Sydney Morning Herald several overseas players are taking initial steps to secure an Australian banking licence. They include commercial Taiwanese lender Cathay United Bank and Middle Eastern commercial major Qatar National Bank.
Saudi Arabian Islamic banking specialist Al Baraka has also been named as eyeing a foothold, suggesting the federal government's efforts in promoting Australia's involvement in Islamic financing are gaining traction. Given the time and capital involved, not all banks see the licence process through, particularly as their commercial goals can quickly change.
None of the banks named responded to requests for interviews. A spokesman for the Australian Prudential Regulation Authority (APRA) declined to comment, citing a policy that prevents it discussing specific licence applications.
In Australia, the rules on operating as a bank or an authorised deposit-taking institution have been designed to protect deposits.
Over the past two years just six new banking licences have been issued to overseas players. Most are Asian or Middle Eastern banks, including two of China's biggest: Bank of Communications and China Construction Bank.
Other entrants include Beirut Hellenic Bank and Taiwan Cooperative Bank. Over the same period three banks have handed back their Australian licences: Allied Irish, Canada's Toronto-Dominion and Bank of Cyprus, which sold its Australian business to Bendigo Bank.
APRA has a reputation as one of the more conservative regulators, which means it can take years for an international bank to secure a licence.
Saudi Arabian Islamic banking specialist Al Baraka has also been named as eyeing a foothold, suggesting the federal government's efforts in promoting Australia's involvement in Islamic financing are gaining traction. Given the time and capital involved, not all banks see the licence process through, particularly as their commercial goals can quickly change.
None of the banks named responded to requests for interviews. A spokesman for the Australian Prudential Regulation Authority (APRA) declined to comment, citing a policy that prevents it discussing specific licence applications.
In Australia, the rules on operating as a bank or an authorised deposit-taking institution have been designed to protect deposits.
Over the past two years just six new banking licences have been issued to overseas players. Most are Asian or Middle Eastern banks, including two of China's biggest: Bank of Communications and China Construction Bank.
Other entrants include Beirut Hellenic Bank and Taiwan Cooperative Bank. Over the same period three banks have handed back their Australian licences: Allied Irish, Canada's Toronto-Dominion and Bank of Cyprus, which sold its Australian business to Bendigo Bank.
APRA has a reputation as one of the more conservative regulators, which means it can take years for an international bank to secure a licence.
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