A prominent financial institution prepares to expand its retail credit portfolio through a strategic acquisition. The transaction involves the transfer of a substantial unsecured personal loan portfolio, marking a critical step in the bank’s growth strategy.
The Competition Commission of India has given its seal of approval to this landmark deal, signalling confidence in the transaction’s potential to enhance market competitiveness. The acquisition represents a calculated approach to targeting the affluent salaried segment and strengthening the bank’s retail credit presence.
Share Price Movement
The share price of Kotak Mahindra Bank Limited went up by 3.05 percent to Rs. 1,801.6 per share on Wednesday, an increase from its previous close of Rs. 1,783.60 per share. The market capitalisation now stands at approximately Rs. 3,57,821 crore as of November 27, 2024.
What Happened
The Competition Commission of India (CCI) has approved Kotak Mahindra Bank’s ₹4,100 crore acquisition of Standard Chartered Bank India’s unsecured personal loans portfolio. Announced in October, this move aligns with Kotak’s strategy to strengthen its retail credit presence, enhance customer-focused growth, and target the affluent salaried segment more effectively.
Q2 Financial Highlights
Kotak Mahindra Bank’s recent filing for the quarter ending September 2024 reveals a decline in key financial metrics. The net interest margin (NIM) dropped to 4.91% from 5.22% in Q2 FY24, while the return on assets (ROA) decreased to 2.17% from 2.45% during the same period. Net Non-Performing Assets (Net NPA) rose to 0.43% compared to 0.37% in Q2 FY24, and the CASA ratio declined significantly to 43.6% from 48.3% a year earlier. These figures reflect a challenging quarter for the bank.
The company’s consolidated net profit has increased by 13 percent, from Rs. 4,461 crore in Q2 FY24 to Rs. 5,044 crore in Q2 FY25. As compared to the last quarter of 2025, the company’s net profit has decreased by 32.2 percent QoQ from Rs. 7,448 crore.
Market Outlook
The Indian banking sector has witnessed a robust recovery, with scheduled commercial banks (SCBs) reporting a strong credit growth of 15.4% in FY23, driven by personal loans, the services sector, and agriculture. The MSME segment has also seen remarkable credit growth, supported by government initiatives.
Additionally, non-banking financial companies (NBFCs) have continued to play a crucial role, deploying a substantial quantum of credit to the industrial, retail, and agricultural sectors. Overall, the industry scenario appears optimistic, with improving asset quality, increased branch expansion, and a growing focus on serving the underserved segments of the economy.
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Asset Under Management
The AUM is divided into different categories as of September 30, 2024. The total AUM is ₹680,838 crores. The largest portion is domestic MF equity at 47%, followed by domestic MF debt at 24%, offshore funds at 12%, insurance at 9%, alternate assets at 7%, and NPS & PMS at 1%. Up 37% YoY from a total of ₹498,342 crores.
Furthermore, Kotak Alternate Assets has secured commitments totalling USD 10 billion since its inception, and the India Midcap Fund is one of the largest India-focused offshore funds actively managed with daily liquidity.h
Shareholding Pattern
As of the November 2024 shareholding pattern, Kotak Mahindra Bank Limited is primarily held by the promoters at 25.88 percent, foreign institutional investors hold 33.39 percent, and the public with 36.91 percent.
About Company
Kotak Mahindra Bank Limited, headquartered in Mumbai, Maharashtra, has grown into one of India’s foremost private sector banks since its inception in 1985. Founded by Uday Kotak, it initially operated as a non-banking finance company before obtaining a banking license in 2003. With approximately 1,869 branches and 3,239 ATMs nationwide, the bank provides a strong physical and digital presence to its customers.
The bank operates through four main segments. Consumer banking focuses on everyday banking needs like savings accounts, loans, and credit cards. Corporate banking serves businesses with trade financing and other services, while commercial banking supports small and medium enterprises.
Kotak’s wealth management division offers specialised financial advisory and investment solutions for high-net-worth individuals. Furthermore, the bank has embraced technology with innovations like the Kotak 811 digital banking platform and the Kotak Cherry super-app.
Kotak Mahindra Bank’s domestic network, complemented by international offices in key global cities, ensures a broad service scope. Its commitment to customer-centric innovation and operational excellence continues to set it apart in India’s competitive financial sector.
Written By Fazal Ul Vahab C H
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