A summit to develop policies and strategies to enhance Australia's position as a regional financial services hub will be held in Sydney next month.

Prime Minister Kevin Rudd and NSW Premier Morris Iemma will address the summit which will bring together leaders in industry, government and academia.

The summit, on 31 July, is a joint initiative of the NSW and Australian Governments, with the participation of the Victorian Government. 

NSW Minister for State Development Ian Macdonald said the growth of the financial services sector was vital to the future of Sydney as a global city.

"Australia and NSW have huge potential to tap into the international financial services market, particularly in the Asia Pacific," Mr Macdonald said.

"Without doubt, Sydney is the finance capital of Australia - ranked tenth worldwide and fourth in Asia.

"Sydney's position is underlined by the fact that it is host to 53 of the 55 authorised deposit taking banks in Australia, plus all of the ten foreign subsidiary banks and all of the 31 local branches of foreign banks in Australia," he said.

Federal Assistant Treasurer Chris Bowen said the summit would build on the Commonwealth's financial services hub strategy.

"We have put in place in Australia one of the world's most competitive withholding tax rates - this will boost Australia's ability to compete in our region," Mr Bowen said.

"Australia is an attractive place to do business. We have a well-regulated and stable operating environment, a highly skilled workforce and a strategic location and time zone."