Dubai-based Emirates NBD Bank is set to acquire 60% stake in RBL Bank for $3 billion, marking the largest cross-border deal in India’s financial sector.

This quickly follows Japan’s Sumitomo Mitsui Banking Corporation’s (SMBC) purchase of 24.2% stake in India’s private lender Yes Bank.

According to a joint statement issued on Saturday, Emirates NBD, which is the second-largest bank in the UAE, has agreed to invest Rs 26,850 crore in RBL Bank, which has no promoter group but is entirely owned by public shareholders. 

The preferential allotment will be at Rs 280 per share, making it the largest fund raise through this route by a listed company in India. This also is the first acquisition of majority interest in a profitable Indian bank by a foreign lender.

Sources said the deal, which goes beyond the normal foreign shareholding restriction in an Indian bank, has got the backing of the Reserve Bank of India (RBI).

As per the regulatory norm, the shareholding of any single foreign institution in an Indian bank is limited to 15%. The regulation otherwise allows 74% foreign investment in private banks.   

As part of the market regulations, Emirates NBD will have to make an open offer to buy another 26% from retail shareholders. RBL Bank said in an investor presentation that Emirates NBD will launch an open offer for additional shares from retail shareholders at Rs 280 per share.

If the open offer gets fully subscribed, Emirates NBD will have to sell down to comply with the regulatory norm of overall 74% foreign investment limit. Currently, foreign holding in RBL Bank is 20.2%.

The Dubai bank’s intent to purchase stake in RBL Bank signifies India’s strategic importance in an economic corridor which is in the process of being developed with nations from the Middle East and Europe.

In a joint statement, the two banks said: "This investment reflects Emirates NBD's confidence in India's fast-growing financial sector, reinforcing India's strategic importance within the India-Middle East-Europe Economic Corridor." 

Having such a large shareholding with management control, the Dubai-based lender will be designated the “promoter” of RBL Bank. It will have the right to nominate directors to the RBL board, subject to regulatory approvals.

The acquisition will combine Emirates NBD’s strong capital base and regional franchise with RBL Bank’s pan-India presence. It will also trigger more consolidation drives in the Indian banking sector through the mergers and acquisitions (M&A) route.

"The infusion will significantly strengthen RBL Bank's balance sheet, enhance its Tier-1 capital ratio, and provide long-term growth capital. This will further enable the bank to deepen its deposit franchise and expand its footprint through calibrated branch network expansion," the joint statement said.

Suffering a setback in 2021 when the RBI appointed an additional director to the lender’s board after its longstanding CEO Vishwavir Ahuja resigned abruptly, RBL Bank has stabilised since then with a new management in place. 

The private lender’s loan book stands at Rs 1 lakh crore and deposit base at Rs 1.17 lakh crore as on 30 September 2025. It serves 14.98 million customers across 564 branches in India. 

RBL Bank Chairman Chandan Sinha believes RBL has entered into a defining moment in its journey of transformation. “The entry of Emirates NBD as our strategic shareholder reflects the global confidence in India's banking sector and RBL Bank’s potential within it. Together, we are poised to strengthen our capabilities, deepen our customer franchise, and build a future-ready institution anchored in trust, governance and growth," he said.

RBL Bank will hope to capitalise on Emirates NBD’s strong credit rating and its established relationships with companies, banks and financial institutions across India. 

Roping in a strategic partner is a significant milestone for RBL Bank. “This partnership secures a robust and globally respected anchor shareholder, providing a strong capital base for our future. We are excited about the synergies this alliance will create and are confident that our combined strengths will deliver superior value to all the stakeholders of the bank,” said RBL Bank managing director and CEO R Subramaniakumar.

While RBL Bank’s current market capitalisation is at Rs 18,370.99 crore, Emirates NBD’s is at $43 billion. Serving nine million customers across 13 countries in the MENAT (Middle East, North Africa and Turkey) region, Emirates NBD, which is 56% owned by Dubai's government, had assets worth $296 billion as of end-June. Net profit for the first half of financial year 2025 stood at $3.4 billion and for full year 2024 at $6.25 billion. 

The purchase will help Emirates NBD to expand its footprint in Asia and deepen its business in the remittance market. Of India’s total outward migration, RBI data shows around 50% is to the Gulf Cooperation Council (GCC).  In FY24, UAE contributed half of the $38.7 billion inward remittances from the Gulf countries.

 Shayne Nelson, Group CEO of Emirates NBD, said the deal will further complement the Dubai bank’s service to customers operating throughout the MENATSA region. “We envisage to support Indian businesses, trade, projects and other opportunities throughout the region leveraging our network,” he stated.