Foreign bank interest in Australia warms up

Foreign banks are taking a shine once more to prospects in Australia, with "at least eight" applications for registration in the pipeline at APRA, the Financial Review reports.

Two banks named by the newspaper as seeking licences are Santander (from Spain) and ICICI (from India).

The remainder of the applicants may be among those foreign banks already registered to operate as representative offices.

Some foreign banks curtailed operations in Australia following the credit crunch that began in 2007, though reports of a "withdrawal" of foreign banks were always exaggerated.

The opening of new foreign banks, mostly from Asia, has continued.

The 35 foreign banks operating in Australia recorded an aggregate profit of A$56 million in the September 2010 quarter, Australian Prudential Regulation Authority data for the sector shows.

Foreign banks had recorded losses, in aggregate, in four of the eight prior quarters, according to APRA.