MUMBAI: The Reserve Bank of India (RBI) has approved the merger of Emirates NBD Bank P.J.S.C.’s Indian branches with RBL Bank, effective 1 December, consolidating the two banks’ Indian operations after the Dubai-based lender acquired a majority stake in the private sector bank earlier this year.
The approval brings Emirates NBD’s three Indian branches under RBL Bank, following the completion of an over ₹26,000 crore transaction that made the foreign lender the promoter of RBL Bank.
“RBI sanctioned the Scheme of Amalgamation of Indian branches of Emirates NBD Bank P.J.S.C. (Transferor Bank) with RBL Bank Limited (Transferee Bank),” the central bank said in a release, adding that all Indian branches of Emirates NBD will function as branches of RBL Bank from 1 December 2026.
The RBI announcement came post market hours. Shares of RBL Bank ended 1.1% higher today at ₹378.25 on the National Stock Exchange.
Building a larger franchise
On 18 June, Emirates NBD completed its acquisition of a 60% stake in RBL Bank for ₹26,000 crore, making it the bank’s promoter. The transaction also included the appointment of five Emirates NBD executives as additional non-executive, non-independent directors on RBL Bank’s board.
The deal was first announced in October 2025, when Emirates NBD said it would acquire a majority stake for $3 billion, or over ₹26,000 crore. The transaction was billed as the largest-ever foreign direct investment and equity fundraise in India’s banking sector. Shareholders approved the deal in November 2025, followed by approval in April 2026 for Emirates NBD to acquire up to 74% of RBL Bank.
The Dubai government, through Investment Corp. of Dubai and Dubai Holding Group, holds about 56% in Emirates NBD. Listed on the Dubai Financial Market, the bank has a market capitalization of more than $50 billion. In India, it operates as a wholly owned subsidiary, with three branches in Mumbai, Gurugram and Chennai and around 30 employees.
RBL Bank, by comparison, had 628 branches and 14,222 employees, catering to over 15 million customers, at the end of September 2026. Managing director and chief executive officer R. Subramaniakumar told Mint in October 2025 that branch expansion would be one of the biggest areas of deployment for the new capital.
On 12 October, RBL Bank reported a net profit of ₹4,818 crore for the second quarter of fiscal year 2027 (Q2FY27), up 170% year-on-year and 90% sequentially. Net advances rose 42% year-on-year and 22% quarter-on-quarter to ₹1.4 trillion at the end of September, while deposits increased 34% year-on-year and 25% sequentially to ₹1.6 trillion.
In a post-earnings analyst call same day, Subramaniakumar said the capital infusion and change in ownership would help RBL Bank deepen existing relationships and establish new ones with large corporates that had previously been inaccessible because of constraints related to credit ratings, capital or the bank’s cost of funds.
The bank is also targeting trade flows along corridors where Emirates operates, seeking to gain a “competitive advantage because of Emirates NBD’s network”. At the same time, it plans to build granular and stable liabilities to progressively narrow the gap between its cost of deposits and that of larger banks.
“We want to leverage the momentum from the FCNR (foreign currency non-resident) deposit relationship we have onboarded to target non-resident flows, starting with the Middle East, and over time, in all the geographies where Emirates NBD has a presence,” he said.
RBL Bank also plans to invest in its distribution infrastructure, including branches, people and technology, to strengthen its presence in relevant geographies and roll out a wealth proposition for customers.
Subramaniakumar said the bank aims to add 30-50 branches every quarter. Expansion, however, will involve more than increasing the branch count: RBL Bank also plans to “densify” existing branches by adding employees at locations where staff have reached the “desired level” of productivity.
“We are going to have a differentiated approach, which is going to be unique for us, in the sense that we are entering into the affluent, which we said almost 3-4 quarters before that we are getting into the wealth business. Now, with the Emirates NBD partnership, we are pretty confident of expanding this growth.”
Analysts see upside, but risks remain
Brokerages differed on how quickly RBL Bank can translate its capital infusion and expanding franchise into stronger returns.
“Much of the improvement (in margins and cost to income ratio) has come from equity infusion by Emirates NBD and the FCNR(B) mobilization, which together grew the balance sheet 20% QoQ,” HDFC Securities said in a note.
While excess capital and liquidity offer medium-term tailwinds for growth and net interest margin, the bank needs to use this window to address its “structural handicaps”, the brokerage said. It maintained a ‘Reduce’ rating on the stock, with a target price of ₹300.
Emkay Global Financial, by contrast, raised its price target by 10.5% to ₹475 and maintained a ‘buy’ rating, citing expectations that return on assets (RoA) would gradually improve to 1-1.3% over FY27-FY29. RBL Bank reported RoA of 0.92% for the quarter, while return on equity (RoE) stood at 4.43%.
“We find RBL as uniquely positioned amongst the fastest growing banks (30% CAGR) along with an improving franchise (lower cost of funds, rising branches),” ICICI Securities said in a post-earnings note. A shift in product mix towards secured loans could weigh on margins but help ease credit costs, it added. The brokerage expects RoA to improve to 1.4%, while RoE is likely to remain in single digits because of low leverage.