StanChart India sells Rs4,100-cr personal loan portfolio to Kotak Mahindra Bank

Standard Chartered Bank, India (StanChart) is selling around Rs4,100 crore ($490 million) of outstanding personal loans to Kotak Mahindra Bank Ltd (KMBL). 

The proposed transaction consists of loans outstanding as of 30 September 2024, but are standard loans as per Reserve Bank of India (RBI) guidelines.

The decision to offload personal loan portfolio is part of StanChart’s decision to focus on the affluent, wealth management as also the small and medium enterprises, said Aditya Mandloi, head of StanChart’s wealth and retail banking for India and South Asia,

For Kotak Mahindra Bank, which is focusing on the retail segment, this transaction will be a big boost to its retail assets growth strategy, according to Ambuj Chandna, head of the bank’s consumer banking division.

The transaction will also give Kotak Mahindra Bank access to a more affluent customer base.

Kotak Mahindra Bank expects to complete the transaction in the next three months, subject to regulatory and customary approvals.

Kotak Mahindra Bank reported a net profit of Rs3,344 crore for July-September quarter of the current financial year, against Rs3,191 crore in the corresponding quarter of the previous fiscal.

The bank’s net interest income (NII) in the July-September quarter rose 11 per cent year-on-year to Rs 7,020 crore, although with lower net interest margin.

Standard Chartered Bank has been operating in India for over 160 years. With 100 branches across 42 cities, StanChart in India serves mostly corporate, commercial and institutional customers.