India's fifth-biggest lender, Bank of Baroda, is expected to set up its branch office in Kuala Lumpur this year, local newspaper reported Wednesday.

Bank of Baroda plans to submit its application to Malaysia's central bank no later than this March and is expected to see its full-fledged subsidiary here by mid-2007, the New Straits Times reported.

The banking subsidiary will be a joint venture between Bank of Baroda and two other Indian commercial banks, namely, Bank of Maharasthra and Oriental Bank of Commerce, Chairman and Managing director of Bank of Baroda Anil K. Khandewal said.

Proposed stake share among the three banks will be 40:30:30 with Bank of Baroda having a majority stake, Khandewal told the English daily in an interview.

The three banks have decided to jointly come into the country as the partnership allows them to spread the risk as well as share the 300 million ringgit (83.33 million U.S. dollars) capital requirement.

Khandewal said the subsidiary, targeting small- and medium- sized enterprises in the country, will initially offer commercial banking, international trade finance, loan syndication services and remittance services.

Bank of Baroda currently has a representative office in Kuala Lumpur. It is reported to have some 60 offices in 21 countries and regions.

Source: Xinhua