The BRICS grouping of emerging powers reached a deal on Tuesday to establish a development bank that would rival Western-backed institutions.

The BRICS grouping of emerging powers reached a deal on Tuesday to establish a development bank that would rival Western-backed institutions, South Africa's finance minister told Agence France Presse.

"We made very good progress, the leaders will announce the details," minister Pravin Gordhan said after meeting with his counterparts from Brazil, Russia, India and China.

The bank is likely to focus on infrastructure financing, a direct challenge to seven decades of dominance by the World Bank.

BRICS negotiators had been under pressure to come up with an agreement that proves the grouping is relevant and sends a strong message to the United States and Europe that the current balance of power is untenable.

The bank is not likely to be up and running for years but South Africa's trade minister Rob Davies said the details were "being hammered out."