Kotak Mahindra Bank has agreed to acquire Standard Chartered Bank personal loan book in India, bolstering the Indian banking giant's position in the retail credit market.
StanChart's personal loan book had an outstanding of Rs 4,100 crore (about $490 million) as of Sept 30, the Indian lender said in a statement.
These are “standard loans”, as per the Reserve Bank of India (RBI) guidelines, Kotak said. This means these loans are performing well and not showing any signs of stress.
The transaction is expected to be completed over the next three months and is subject to regulatory approval.
The Indian bank said the loan book will strengthen its position in the affluent customer segment and grow further in the retail lending space.
“India’s unsecured lending market offers significant growth potential for Kotak, especially in the higher-end segment,” said Ambuj Chandna, Head-Products, Consumer Bank at Kotak Mahindra Bank.
“This transaction supports our retail assets growth strategy and reinforces our commitment to retail lending,” Chandna added.
Aditya Mandloi, head of wealth and retail banking for India and South Asia at Standard Chartered Bank, said that the decision to sell the personal loan book is in line with its focus to accelerate growth in the wealth, affluent and SME segment.
“India continues to be a key market for Standard Chartered network,” he said, adding that wealth and retail banking and corporate and investment banking will the bank’s cornerstones in India.