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Private sector lender Kotak Mahindra Bank has entered into a definitive agreement to acquire the ₹4,100-crore personal loan book of Standard Chartered Bank, India, subject to regulatory approval.
“As of September 30, 2024, the proposed transaction comprises a total loan outstanding of around ₹4,100 crore (equivalent to ~$490 million). The transaction consists of loans classified as ‘Standard Loans’ in line with the Reserve Bank of India (RBI) guidelines,” the lender said.
The transaction is expected to be completed over the next three months, and Kotak Bank will acquire the loan book, which will be outstanding closer to the completion date.
- Also read: Kotak Mahindra Bank integrates physical and digital branches in new distribution structure
String of acquisitions
Kotak Bank has completed four acquisitions in the last decade. These include acquiring the then Bengaluru-headquartered ING Vysya Bank in an all-stock deal in November 2014 for around ₹15,000 crore.
In 2016, the lender acquired BSS Microfinance in an all-cash deal for ₹139 crore. In 2021, the it acquired Prius Commercial Projects under the Insolvency & Bankruptcy Code for ₹450 crore.
The bank’s last acquisition was in 2023, when it acquired another MFI — Sonata Finance — for ₹537 crore. According to the bank’s new MD and CEO Ashok Vaswani, the lender could make more acquisitions going ahead, as it is aiming to become the third largest private sector lender in terms of profitability by 2030. To achieve the feat, it will have to bridge an over ₹8,000-crore net profit gap (in FY24) between itself and the third most profitable private lender, Axis Bank.
Ambuj Chandna, head of products, consumer bank at Kotak Mahindra Bank, said, “This transaction supports our retail assets growth strategy and reinforces our commitment to retail lending.”
“It provides access to a high-quality customer base, and with Kotak Group’s successful integration track record, we are committed to a smooth transition,” he said.
Standard Chartered India operations
Even after exiting the personal loan segment, Standard Chartered Bank India will continue operating in the corporate, commercial and institutional banking segments in India. Like other foreign lenders, the bank has a suite of products in the consumer, private and business banking space.
Apart from deposit products, the lender’s loan products include credit cards, loans against securities and term deposits, mortgage and business loans, and other investment, insurance and payments related services.
It has 100 branches across 42 cities in India, per its website, besides a non-banking finance company — Standard Chartered Capital — to cater to regional segments.
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