Public sector lenders, Bank of Baroda (BOB), Indian Overseas Bank (IOB) and Andhra Bank have signed a joint venture agreement for setting up a banking subsidiary in Malaysia, in the name of BIA Bank (Malaysia) Bhd.

Under the newly formed subsidiary, Bank of Baroda holds 40% stake, Indian Overseas 35% stake and Andhra Bank - 25% stake.

It should be noted that the banks have already obtained the necessary approval from Reserve Bank of India (RBI) for the venture.

The consortium intends to invest Rs 405-crore for the set up of subsidiary in Malaysia, which will serve the banking needs of all sections of the population including corporates and ethnic Indian population.

The first branch, proposed to be set up in Kuala Lumpur, is expected to begin operations by September this year.