A suitor from the Middle East for India's RBL Bank
Emirates is looking to buy a controlling stake in the listed private lender. Talks between Emirates NBD and RBL Bank two picked up after Sumitomo Mitsui completed the acquisition of 20% in Yes Bank in September.
MUMBAI : Dubai's Emirates NBD Bank PJSC is in talks to buy a controlling stake in Indian private lender RBL Bank Ltd for over $1 billion, two people with direct knowledge of the discussions said.
“Emirates NBD Group is likely to acquire around 26% stake in RBL Bank from institutional investors, and then make an open offer for another 25%," one of the persons said. If the transaction concludes successfully, the Dubai government entity will end up holding around 51% stake in the domestic lender. Global investment bank JP Morgan is advising Emirates NBD on the deal.
The discussions underscore multinational financial firms' growing fascination with India. Japan’s Sumitomo Mitsui Banking Corp. recently acquired a 20% stake in Yes Bank, and Mizuho Financial Group is said to be looking to acquire financial services firm Avendus.
However, the Reserve Bank of India, if it approves the Emirates-RBL deal, is likely to cap the voting rights of the Dubai entity at 26% due to “regulatory requirements", the second person said.
- Emirates NBD eyes majority 51% stake in RBL Bank for over $1 billion.
- RBI will likely cap the Dubai entity's voting rights at 26% due to regulations.
- The potential RBL deal highlights multinational financial firms' growing interest in the Indian market.
- Talks progressed following Sumitomo Mitsui Banking Corp.'s acquisition of a Yes Bank stake.
- RBL Bank, currently without a promoter, is fully owned by diverse public shareholders.
An RBI circular in January 2023 said no bank shareholder can exercise voting rights above 26%. Normally, non-promoters— individuals or non-financial institutions—can buy up to 10% in a bank, while financial institutions can buy up to 15%. However, RBI “may also permit higher shareholding on a case-to-case basis", it said in the circular cited above.
Queries emailed to Emirates NBD and RBL Bank remained unanswered, while a JP Morgan spokesperson declined to comment.
Yes Bank push
Talks between the two picked up after Sumitomo completed the acquisition of 20% in Yes Bank in September. The Japanese firm has also signed an agreement with CA Basque Investments, a company affiliated with The Carlyle Group Inc., to acquire an additional 4.2% in Yes Bank, taking its total stake to 24.2%. In August, RBI had approved SMBC’s proposal to buy up to 24.99% in Yes Bank. Discussions between Emirates and RBL Bank picked up after the Yes Bank deal, the first person said.
RBI governor Sanjay Malhotra told CNBC TV18 in July that the central bank had not yet received any case where a foreign bank wants to own 26% in Indian banks. “As per the FDI policy, the foreign banks are allowed up to 74%. Foreign banks can certainly have 26% stake in an Indian bank," he told the channel.
There have been very few cases of foreign banks acquiring Indian lenders.
The central bank seized Yes Bank in March 2020 after its financial position deteriorated, and supervised its acquisition by a clutch of banks led by State Bank of India. Mint reported in August that the Yes Bank-SMBC deal may pave the way for similar transactions.
Earlier in November 2020, RBI had seized the struggling Lakshmi Vilas Bank (LVB) and forced its merger with the local unit of Singapore’s largest lender DBS Bank. That was the first time the central bank had tapped a bank with a foreign parent to backstop an Indian rival.
RBL Bank does not have a promoter and is fully owned by public shareholders. At the end of June, retail investors owned 47.69% in the bank, followed by domestic institutional investors at 34.72%, foreign institutional investors at 17.56%, and insurance companies at 3.26%.
Emirates in India
Discussions between RBL and Emirates NBD come barely five months after RBI granted in-principle approval to the Dubai bank to establish a wholly-owned subsidiary in India.
In July, Economic Times reported that Emirates NBD was in talks to buy a significant minority stake in RBL Bank.
India allows foreign banks to operate either as a branch, or a wholly-owned subsidiary of the parent. All except two—DBS Bank India and SBM Bank India—work as branches. A local unit gives more flexibility to the bank than a branch. The central bank prefers foreign banks operating subsidiaries rather than branches in India.
In 2018, Fairfax India, the local unit of Canada's Fairfax, acquired a 51% stake in CSB Bank Ltd, then called the Catholic Syrian Bank (CSB). Currently, it holds 40% in the bank.
In India, Emirates NBD reported a loan book of ₹6,568.2 crore as on 31 March 2025, according to its latest available annual report, up from ₹4,641.6 crore in FY24.
RBL Bank closed with a market capitalization of ₹17,728.56 crore or around $2 billion on Monday. Shares were down 0.82% at ₹289.20 a share over Friday’s close on NSE.
RBL roundup
Founded as Ratnakar Bank Ltd in 1943 in Maharashtra's Kolhapur, RBL operated 562 branches as on 30 June. Its total business (loans plus deposits stood at ₹2,07,165 crore.
As per initial business numbers reported by the bank on 3 October, its deposits stood at ₹1.16 trillion, up 8% from the same period last year. Total loans were at ₹1.02 trillion, up 14% year-on-year (y-o-y). Its capital adequacy ratio at the end of the June quarter (latest available) stood at 15.59%, as against 15.56% a year earlier, and 15.54% in the March quarter. In comparison, Yes Bank’s capital adequacy ratio was at 16.2% in end-June.
A September 2025 ratings release by Care Ratings shows that the bank has a portfolio comprising Corporate & Institutional Banking (C&IB), Credit Cards, Commercial Banking (CB), Business Loans and Micro Loans, while also expanding into newer secured products such as housing loans, loans against property (LAP), rural vehicle finance. In Q1 of FY26, RBL Bank recorded a y-o-y growth of 5% in the retail segment and 15% in the wholesale segment, resulting in overall advances growth of 9%.
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