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“The strategic intent behind this acquisition is to further grow our business loans portfolio for chosen client segments. Business loans are an important element in our segmented offering. This acquisition also gives us a very good set of customers who can be offered our entire suite of banking products,” said Paul Parambi, head of group strategy at Kotak Mahindra Bank, in a statement. He added Kotak has an appetite for further acquisitions, which can strategically create value for us and will actively seek such opportunities.
The acquisition will help Kotak Mahindra Bank gain access to around 6,000 business loan customers. The outstanding loan portfolio is estimated at Rs 700 crore. The acquired loans are classified as standard assets according to the Reserve Bank of India’s (RBI) guidelines, the private lender said.
Barclays, in a statement, confirmed the acquisition of its business loan portfolio in India by Kotak Mahindra. “Our growth in India is focused on our competitive strength for providing services to multi-nationals and large corporates, utilising our offerings in international banking such as cash management and trade finance, as well as providing wealth management and investment banking services,” the foreign lender said in the statement.
Kotak Mahindra Bank had acquired the non-performing portfolio of Barclays’ credit card business in India in early 2012. The stressed card portfolio was estimated to be Rs 250-300 crore.
Barclays had sold its performing cards portfolio in India to Standard Chartered Bank. The foreign lender had indicated that it would exit its retail and business loans businesses here.
