Emirates NBD to acquire majority stake in RBL Bank for $3 billion in biggest banking FDI deal

In a landmark move for India’s financial sector, UAE’s Emirates NBD Bank PJSC has committed over ₹26,000 crore ($3.05 billion) to acquire a controlling stake in RBL Bank through a combination of preferential allotment and open offer. This will make it the largest foreign direct investment in an Indian bank and the biggest equity capital raise via preferential issuance by a listed Indian company.

As per a joint announcement by both institutions on October 18, 2025, Emirates NBD will acquire 60% of RBL Bank’s expanded share capital through a preferential allotment of 95.9 crore shares at ₹280 per share. This primary capital infusion is valued at ₹26,580 crore.

The deal also triggers a mandatory open offer for up to 26% of the bank’s shares from public shareholders, valued at ₹11,636 crore, under SEBI’s takeover regulations. If fully subscribed, Emirates NBD will scale down its holding to remain within the 74% foreign ownership cap applicable to private sector banks in India.

Currently, foreign investors hold 22% in RBL Bank. This will dilute to about 11% post the preferential allotment. The final stake of Emirates NBD will range between 51% and 74%, depending on open offer response and regulatory conditions. The investment agreement includes clauses for proportional reduction to comply with minimum public shareholding (25%) and foreign ownership limits.

The transaction is subject to approvals from the Reserve Bank of India (RBI), Competition Commission of India (CCI), Department for Promotion of Industry and Internal Trade (DPIIT), and other statutory bodies. RBI has informally signalled its support for the deal, and Emirates NBD has already received in-principle nod earlier this year to operate in India as a wholly owned subsidiary — a move that paved the way for this acquisition.

The deal also outlines the eventual merger of Emirates NBD’s India branch operations into RBL Bank, subject to shareholder and regulatory clearances. Post-transaction, the Dubai lender will be classified as the promoter of RBL Bank and gain board representation through nominated directors.

This strategic entry follows a similar move by Sumitomo Mitsui Banking Corporation of Japan, which proposed acquiring up to 25% in Yes Bank. However, Emirates NBD’s investment far exceeds it in scale, making it the most significant M&A event involving a foreign bank in India to date.

From a financial standpoint, the move comes at a time when RBL Bank is showing operational stability. For the quarter ended September 2025 (Q2 FY26), the bank reported a net profit of ₹179 crore, with 6% QoQ growth in net advances (₹1,00,529 crore) and 8% YoY growth in total deposits (₹1,16,667 crore). Core fee income rose 17% QoQ, while the secured retail loan book grew 30% YoY.

RBL’s total capital adequacy as of September 30, 2025, stood at 15.02%, with CET-1 at 13.51%. Post-infusion, the bank is expected to be well-capitalized for medium-term growth, giving it the firepower to expand retail, commercial, and digital banking operations.

RBL Bank, formerly known as Ratnakar Bank, operates 564 branches and 1,347 business correspondent locations across India, serving nearly 15 million customers. The deal is being managed by J.P. Morgan India Private Limited.

In a statement, the banks said the acquisition underscores Emirates NBD’s long-term commitment to India’s financial services space, and its confidence in the country’s economic and banking growth story.