How UAE’s Emirates NBD made history with India’s biggest banking bet on RBL

Dubai: UAE's Emirates NBD, one of the largest banking groups in the Middle East, is making one of the boldest moves ever seen in India’s financial sector.

The bank will invest about $3 billion (₹26,850 crore / ₹268.5 billion) in RBL Bank, giving it a controlling 60 percent stake through a new share issue. It may end up owning more if public shareholders sell in the open offer that follows.

The deal is historic. It’s the largest foreign direct investment India’s financial services sector has ever seen, the biggest equity fundraise by any Indian bank, and the first time a profitable private lender will be majority-owned by a foreign bank. It also ranks as the largest foreign acquisition in the sector, according to deal data reported by Reuters.

Emirates NBD will buy newly issued RBL Bank shares, meaning the money goes directly into the bank to strengthen its balance sheet. That capital will help RBL lend more, expand its branch network, and invest further in digital banking.

The transaction still needs approval from the Reserve Bank of India (RBI) and other regulators, but both boards have signed off. Emirates NBD will also make a mandatory open offer to RBL’s public shareholders, as required by takeover laws, allowing them to exit after the ownership change. Once approved, the Dubai bank plans to merge its existing India branches into RBL, turning it into its main local presence.

For Emirates NBD, this is a fast track to scale in one of the world’s fastest-growing banking markets. The bank currently operates only a few Indian branches in Mumbai, Gurugram, and Chennai. With RBL, it gains an instant national footprint of more than 560 branches, 15 million customers, and a ready retail platform it would have taken decades to build on its own.

For RBL Bank, the benefits go beyond cash. The $3 billion infusion will lift its Tier-1 capital ratio and give it the firepower to compete with larger private peers. It also gains a strong promoter with a top global credit rating, robust governance, and deep corporate relationships across the Middle East and Europe. That should strengthen confidence among investors and depositors and lower RBL’s cost of funds.

RBL’s CEO R. Subramaniakumar called it “a milestone that gives the bank a strong and respected anchor shareholder.” Emirates NBD’s Shayne Nelson said the investment reflects faith in India’s “vibrant and expanding economy” and will help serve Indian businesses across the region.

Foreign ownership in Indian private banks is capped at 74 percent, but getting there isn’t automatic. The RBI will need to clear the proposal, assess Emirates NBD’s fit-and-proper status, and review the branch-merger plan. The open offer will also require SEBI approval.

The process will take time, yet the public announcement suggests both sides expect it to move smoothly. Regulators have grown more receptive to strategic foreign capital, especially when it strengthens balance sheets and governance. This deal will likely become a test case for majority foreign ownership in a healthy private bank.

Foreign takeovers in Indian banking aren’t new, but none match this scale. In 2018, Canada’s Fairfax Financial Holdings bought 51% of CSB Bank, a small Kerala-based lender then known as Catholic Syrian Bank. That was a regional deal involving a modest-sized player.

Since then, India has seen a few big banking moves. DBS Bank India received a ₹2,500 crore (₹25 billion) capital infusion from its Singapore parent to absorb the troubled Lakshmi Vilas Bank, a rescue deal aimed at stabilising the institution.

There was also the ING Vysya–Kotak Mahindra merger, valued at ₹15,000 crore (₹150 billion), and in May 2025, Japan’s Sumitomo Mitsui Banking Corporation (SMBC) agreed to buy a 20% stake in Yes Bank for $1.6 billion (₹133 billion), with plans to increase it to 24.99%, the regulatory ceiling.

Emirates NBD’s move stands apart—a majority acquisition of a profitable, mid-sized, listed Indian bank by a major global lender, combining scale, strength, and strategy not seen before in India’s banking sector.

That makes it a turning point. It signals India’s openness to strategic foreign ownership, not just financial investment. The move also fits the deepening economic ties between India and the UAE through the India–Middle East–Europe Economic Corridor, launched in 2023, linking South Asia with Europe via Gulf trade hubs.

It’s also worth noting that big fundraises like SBI’s 2025 QIP (~₹250 billion)—a share sale to institutions to raise capital—were large but didn’t change who controls the bank. This deal does, giving Emirates NBD a clear majority stake.

Key milestones now are regulatory clearance, open-offer pricing, and integration of Emirates NBD’s India operations into RBL. Investors will watch how RBL deploys the $3 billion—whether toward retail lending, deposits, or digital upgrades.

Analysts say the deal could lift valuations for other mid-tier banks by proving that global institutions are ready to take controlling stakes, not just minority positions. If it proceeds smoothly, it could open the door for more such investments from international banks seeking a foothold in India’s expanding financial market.

At its core, the deal is about confidence. A major Middle-Eastern bank is betting billions on India’s banking future, and a mid-tier Indian lender is gaining the capital and credibility to move up the ranks. It shows Indian banks are no longer viewed as takeover risks but as genuine growth partners for global players.

If regulators clear it, the Emirates NBD–RBL Bank transaction will mark a new chapter in Indian banking—one where global capital, Indian scale, and regional trade ambitions align. And for once, a foreign takeover in Indian banking isn’t about rescuing a weak bank. It’s about building a stronger one.