The Competition Commission of India on Tuesday approved the proposed acquisition of majority shareholding in RBL Bank Ltd. by Emirates NBD Bank. 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 regulator has approved.
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. The banks third quarter net profit jumped to Rs 214 crore from Rs 32.6 crore last year.
Last month, RBL Bank said it is yet to receive approval from the government and the Reserve Bank of India on its request to cap foreign shareholding in the bank to 24% till the deal with Emirates NBD is concluded. The foreign bank has sufficient foreign shareholding headroom to hold minimum 51% stake in RBL Bank. A statement said both parties are actively engaged with authorities in fulfilling the conditions precedent to the proposed transaction.
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.
Shares of RBL Bank settled 2.8% lower at Rs 293.7 on the BSE, ahead of the news, compared to a 1.3% decline in the benchmark Sensex. The stock is up 86% in the last 12 months.
ALSO READ: J&K Bank Q3 Results: Profit Up 11% To Rs 589 Crore
Watch LIVE TV, Get Stock Market Updates, Top Business, IPO and Latest News on NDTV Profit.
