Competition Commission approves Kotak Bank's acquisition of StanChart India's personal loans portfolio

The approval affirms the regulatory compliance of this transaction while bolstering Kotak Mahindra Bank's position in the retail lending market.

The Competition Commission of India (CCI) has approved Kotak Mahindra Bank's acquisition of Standard Chartered Bank India's personal loans portfolio for Rs 4,100 crore, previously announced in October.

The acquisition involves transfer of an unsecured personal loan book from Standard Chartered Bank's India arm to Kotak Mahindra Bank.

Announced in October this year, the deal is valued at approximately $490 million and is part of Kotak Mahindra Bank's strategy to expand its retail credit portfolio and strengthen presence in the affluent customer segment.

Deals exceeding a specific threshold require CCI's clearance, to ensure fair competition and prevent monopolistic practices. The approval affirms the regulatory compliance of this transaction while bolstering Kotak Mahindra Bank's position in the retail lending market.

This move aligns with the bank’s transformation strategy aimed at scaling its operations and enhancing customer-centric growth. Kotak Bank had said India's unsecured credit market offers a 'significant growth potential', especially in the higher-end segments.

India's personal loan market has increasingly become competitive as consumer demand has grown. The central bank had in 2023 asked banks to set aside more capital for personal credit, as concerns emerged over the risk of default. This has moderated banks' outstanding personal loan book compared to a year ago.