Mumbai: Kotak Mahindra Bank has signed a definitive agreement to acquire Deutsche Bank’s retail banking, affluent private banking and wealth management business in India for approximately ₹282 crore, the private sector bank said in a press release on Tuesday.
The acquisition will add about ₹29,000 crore in loans, ₹16,000 crore in deposits, and ₹10,500 crore in assets under management to Kotak Bank’s balance sheet.
The deal will bring around 150,000 customers and nearly 1,000 employees of the German bank into Kotak’s fold, strengthening the lender’s presence in the affluent and small and medium enterprise (SME) segments. The transaction is expected to close by September 2027, subject to regulatory approvals, including clearance from the Competition Commission of India.
“This transaction aligns well with our focus on the affluent and SME segments. It is a strong strategic fit and makes sound commercial sense. It also brings a high-quality customer franchise and experienced teams and adds incremental scale and adjacency opportunities,” said Ashok Vaswani, managing director and chief executive officer of Kotak Mahindra Bank.
“We look forward to warmly welcoming these customers and colleagues to the Kotak family and our priority will be on disciplined integration and ensuring continuity, while building further depth and capability in this business,” Vaswani added.
For the quarter ended March, the Indian private lender’s customer assets grew 14% on year to ₹5.45 trillion and deposits rose by 15% on year to ₹5.72 trillion.
Of the total assets, consumer banking, which consists of 37% of the total loan book share, rose 14% on year to ₹1.91 trillion, followed by SME book at ₹1.22 trillion, up 19%, corporate banking at ₹1.13 trillion and commercial banking at ₹79,270 crore, up 22% and 8%, respectively.
For Deutsche Bank, the sale marks another step in its strategy to simplify operations and sharpen its focus on businesses where it enjoys greater scale.
“This transaction marks an important step in sharpening Deutsche Bank’s portfolio and focusing on areas where we have scale, strength, and the ability to deliver sustained returns,” said Kaushik Shaparia, chief executive officer of Deutsche Bank Group India and Emerging Asia.
He said India remains a core market for the German lender, underpinned by its corporate and investment banking franchise, while Kotak offers a strong domestic platform to ensure long-term continuity for its onshore private banking and wealth clients, while creating meaningful growth opportunities for its employees.
Kotak said the acquisition is in line with its inorganic growth strategy of pursuing targeted opportunities that strengthen its core franchise. The bank expects the acquired business to complement its relationship-led model and broaden its banking and investment offerings for affluent customers.
Both lenders said they will work together to ensure a seamless transition for customers and employees. Upon completion, the transaction is expected to be return-on-equity accretive for Kotak and common equity tier-1 (CET1) accretive for Deutsche Bank. CET1 comprises ordinary shares and retained earnings.
Deutsche Bank will continue to operate its corporate bank, investment bank and other businesses in India following the sale.
Kotak Bank’s RoE was at 12.27% as of March end as against 10.68% a quarter and its CET-1 ratio was 21.3% as of March end.
Kotak’s acquisition marks the latest consolidation in India’s private banking sector after Axis Bank absorbed Citibank India’s consumer business in 2023, bolstering its affluent banking, wealth management and retail franchise.