Emirates NBD’s CEO has big hopes for its Indian acquisition

• Bought 60% of RBL Bank for $3bn
• To support Gulf-India investment
• Reflects UAE’s confidence in India

Dubai bank Emirates NBD will expand its wealth management, investment banking and small business banking services in India following its $3 billion acquisition of Mumbai-based RBL Bank.

The bank hopes the acquisition will strengthen its position in a key growth market, supporting Gulf clients’ investment in India and deepening its presence along the India-GCC-Africa corridor.

It also wants to scale wealth management, investment banking and SME services while expanding its corporate balance sheet.

In October Emirates NBD – Dubai’s largest bank by assets and majority owned by the emirate’s government – agreed to buy 60 percent of RBL, with the deal to be completed pending regulatory approval. Emirates NBD will also make an offer for 26 percent of RBL’s shares that are publicly listed. 

Emirates NBD opened its first office in India in 2000, obtaining a branch licence in 2017. Its three Indian branches will merge with those of RBL, which is India’s 41st largest bank by assets according to S&P Global Ratings.

Shayne Nelson, Emirates NBD’s chief executive, said the takeover of RBL reflected the UAE government’s confidence in the country.

“It also aligns with the growing investments of our clients into India,” Nelson told India’s Economic Times. “It positions us well for future profitability while benefiting India and our existing customers around Gulf Cooperation Council countries.”

Nelson said there were huge opportunities in expanding his bank’s wealth management and investment banking services in India and did not rule out making “bolt-on acquisitions” to expand its footprint in the world’s fifth largest economy.

This month, Emirates NBD was also linked with Deutsche Bank’s network of 17 branches in India, while the Dubai bank in 2023 declined to comment on reports it was a potential bidder for state-owned IDBI Bank.

“The large corporates who already bank with [Emirates NBD] can now be onboarded to the RBL platform,” said Nelson.

“SME banking is something we are good at and operate in all our markets as we think they are the future of any country. Trade and capital flows should also grow.”

Emirates NBD’s control of RBL will help the two banks make the most of the non-resident Indian “corridor between India-GCC-Africa”, said Nelson. 

About 29 percent of remittances to India come from the Gulf, India government data shows, while the total value of remittances was $113 billion in 2022-23, up 27 percent year on year.

Further reading:

• Emirates NBD buys 60% stake in India’s RBL Bank
• Investors and analysts shrug off Emirates NBD’s profit decline
• Emirates NBD gets nod to set up Indian subsidiary

RBL has 1.5 trillion rupees ($16 billion) in assets – about one-fiftieth of market leader State Bank of India – as well as 15 million customers and about 560 branches.

“At the moment, RBL is a small to medium player … but we do believe it has some excellent capability to grow the branch network,” Nelson told a late October analysts’ call.

“We’re already banking a lot of corporates within India and offshore,” he added. “We can boost the balance sheet in the corporate banking space now and pick up ancillary business within India.”

Although Emirates NBD ostensibly has only 26 percent voting rights at RBL, this limit refers to the maximum voting rights for each board member, Nelson told analysts.  

“So, if you work out how the voting works, we believe, and certainly the auditors believe, that we can demonstrate control,” added Nelson.

“Frankly, we’ve said many times before that we would not acquire any institution unless we could demonstrate control.”