The Reserve Bank on India on Thursday approved the proposed acquisition of majority shareholding in RBL Bank Ltd. by Emirates NBD Bank, sources told NDTV Profit. The Dubai-based lender had announced a $3 billion deal to acquire 60% stake in RBL Bank in October via a preferential allotment of equity shares.
Emirates NBD will acquire control over the RBL Bank and will be classified as a promoter, and the acquired bank will be classified as a subsidiary of a foreign bank. India allows 74% foreign investment in private banks, but limits shareholdings of any single foreign institution to 15% unless the RBI has approved.
The deal has already received Competition Commission of India's nod and may get clearance from the Securities and Exchange Board of India soon.
The Emirates NBD-RBL Bank deal is expected to be closed by the first quarter of financial year 2026-27, executives said in a recent earnings call. It will be the first acquisition of majority interest in a profitable Indian bank by a foreign bank.
RBL Bank, formerly known as The Ratnakar Bank Ltd, is a private sector lender established in 1943. Originally established as a regional bank in Maharashtra, RBL Bank became a private sector lender in 1970. It, however, remained a closely owned small lender, largely limited to Maharashtra.
The bank will continue hosting its current client base in the retail and medium, small and micro enterprises segments. Emirates NBD is expected to help in developing its cross-border financing and non-resident businesses through this transaction. RBL Bank is planning to open 200 branches in FY27 to take its network to over 800 branches.
The private lender's third quarter net profit jumped to Rs 214 crore from Rs 32.6 crore last year.
Shares of RBL Bank traded 1.5% lower at Rs 297 on the NSE, compared to a 2% decline in the benchmark Nifty 50. The stock is up 73% in the last 12 months.
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