Kotak Mahindra Bank has reached an agreement with Deutsche Bank (DB) to acquire the retail banking, affluent private banking and wealth management operations of DB in India, one of the biggest strategic deals in the banking industry in the country in recent years. The deal is targeted to bolster Kotak's market share in the high net-worth and the small and medium business banking sectors and boost its wealth management business.

Key Highlights

• Kotak Mahindra acquires Deutsche Bank's India retail and wealth business.
• Around 1.5 lakh customers and 1,000 employees will transition by September 2027, subject to approvals.

As part of the business purchase, Kotak Mahindra Bank will get a portfolio of loans valued at Rs 29,000 crore, deposits worth Rs 16,000 crore and assets under management (AUM) valued at Rs 10,500 crore. The business being acquired has nearly 1.5 lakh customers, and employs around 1,000 people, all of whom will be expected to join Kotak as part of the amalgamation.

Subject to approvals and regulatory clearances by the Competition Commission of India (CCI) and relevant regulatory authorities, the acquisition is expected to be completed by September, 2027. Both banks will collaborate to provide continuous services for customers and a smooth transition.

Ashok Vaswani, Managing Director and CEO of Kotak Mahindra Bank stated, "The acquisition is in line with the Bank's strategy of building its affluent customer base and its SME banking operations. The deal also adds to the Kotak's long-term growth plans, as well as providing additional growth opportunities and a high-quality customer franchise and experienced teams."

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In a move that will help streamline the bank's operations, Deutsche Bank is selling the unit as part of its Global Hausbank strategy that aims to streamline operations and narrow its focus to areas where it has more scale and competitive strength. While leaving the retail banking and wealth management business in India, Deutsche Bank will retain its Corporate Bank, Investment Bank and DWS asset management operations in India, thereby reiterating India's status as a key strategic market for the bank.

The deal is set to give Kotak Mahindra Bank a much greater ability to compete in the retail and wealth management segment, while giving customers of Deutsche Bank access to a wider range of banking, investment and financial services. The transaction also highlights India's banking sector's consolidation drive as banks move to build scale, relationships with customers and diversify revenue.