India's 101-year-old listed Bank of Baroda, which already operates in 70 countries, has registered as New Zealand's 19th bank and its first branch is likely to be in Auckland by early next year.
Baroda is the third-largest public sector bank in India among the 13 nationalised commercial banks.
The company said a year ago its services in New Zealand would include student loans, mortgage loans, trade finance and all other conventional commercial banking products, according to Auckland-published Indian Newslink.
In March this year, Mumbai-based Baroda's assets had increased 30% to $US70.25 billion ($102.8 NZ billion) and its annual after-tax profit was up by 55% to $4.6 billion ($NZ6.7 billion).
Most of New Zealand's 19 registered banks are all rated separately by Standard and Poors, Fitch and Moody's.
However, Baroda, the TSB Bank Ltd, Kiwibank Ltd, Rabobank New Zealand Ltd and Southland Building Society all have only one rating agency - Baroda's being a BBB- with Fitch.
Craigs Investment Partners broker Peter McIntyre said investors had to be aware the Fitch BBB- was lowest of all "investment grade" ratings, while the country's four major banks were in the AA or better grades.
Massey University Centre for Banking Studies director Dr David Tripe was contacted and said Baroda had an established trade in Fiji, with five branches, and already had some experience in the Pacific arena.
He said it was possible Baroda may target becoming a niche bank seeking Indian trade.
There are more than 110,000 people of Indian descent in the country.
"Baroda coming here is a reflection of continuing developments between India and New Zealand," Dr Tripe said.
The Reserve Bank of New Zealand announced Baroda's registration yesterday.
Registration was signalled about a year ago, when the bank announced its intentions of opening a branch in Auckland.
It will change its name to Bank of Baroda (New Zealand) Ltd before starting trading.
Baroda, which is listed on the Bombay/Mumbai exchange, was founded in 1908 and operates in 70 countries with 2738 branches plus subsidiaries, joint ventures and representative offices and almost 40,000 employees.
