In recent months, there has been growing speculation that Kotak Mahindra Bank is likely to acquire Deutsche Bank’s India retail business.
Deutsche Bank’s chief executive Christian Sewing had announced plans to cut jobs in its retail banking division back in March 2025. The German bank is understood to be in dialogue with interested parties to sell its retail business in India. Kotak Mahindra Bank, according to a report last month, was set to acquire the operations to strengthen its retail operations. Both banks so far have been tight lipped on that.
On May 2, Ashok Vaswani, Kotak bank’s MD and CEO said the private sector lender was constantly looking for opportunities in the marketplace.
“We look at every single opportunity that comes up. For every single opportunity, we ask three questions. Number one, does it make strategic sense? If it makes strategic sense, does it make financial sense? And three, is it a major distraction from a management bandwidth perspective? If the answer to the strategic sense is yes, the answer to the financial sense is yes, and the answer to the third question is no, we will do a transaction, ” he said.
He said the same logic would apply to Deutsche as well, without stating specifically, whether any deal was likely.
Did high valuations hit IDBI Bank sale?
Over the last decade, Kotak Bank has made several acquisitions to gain scale. In 2014, Kotak Bank acquired ING Vysya Bank. More recently, it acquired the personal loan book of Standard Chartered Bank India in 2024. The same year it also acquired Sonata Finance. Earlier, in 2016, it had snapped up BSS Microfinance.
The country’s fourth largest private sector lender was also linked with the potential acquisition of IDBI Bank. However, the government found few takers, with most bids by potential buyers coming in below the reserve price.
Vaswani stated that, while IDBI Bank had been examined as they explore any potential acquisition, valuation was very high.
“Even the bids that the government got were frankly lower than the reserve price they put. Our view also was the valuation being demanded was very, very high. Of course, it could have given us some kind of scale, but it wasn’t really a slam dunk, which is something that was a must for us to do,” Vaswani pointed.
He was speaking post Kotak Bank’s fourth quarter earnings announcement.
The Mumbai-based lender reported a standalone net profit of Rs 4,027 crore in the January-March quarter up 13 per cent year-on-year. The net interest income was up 8 per cent to Rs 7,876 crore.
Vaswani pointed that so far the bank had not seen any impact from the conflict in West Asia and the disruptions that it had caused across sectors. But, it was something the lender was watching closely.
“On global developments, including the situation in West Asia, there has been no impact on the bank’s operation or core business performance. That said, we remain very watchful and prudent as conditions evolve,” he stated.
But, he added that longer the conflict lists, there could be more impact. It has stepped up monitoring to see if there is any change in customer behaviour.
” What really worries us is a second, third order kind of impact, where you don’t see a direct impact, but suddenly it comes out of left field. That is something that obviously we are conscious of,” said Vaswani.
He noted that usually in cases like this, it’s the bottom end that gets hurt first and the bank was monitoring that more tightly.
