New Delhi, Oct 18 (PTI) Emirates NBD Bank, the second largest in UAE, has expressed interest to acquire a majority 60 per cent stake in RBL Bank for Rs 26,853 crore, the biggest ever financial sector deal in value terms.

The acquisition plan of Emirates NBD Bank to hold a controlling stake in RBL Bank through an infusion of approximately USD 3 billion (about Rs 26,850 crore) marks the largest-ever foreign direct investment in India's financial services sector.

The proposal comes days after Japan's SMBC picked up a 24.9 per cent stake in private sector Yes Bank for a total consideration of Rs 16,333 crore.

The board of RBL Bank while approving the quarterly financial number approved the proposal for raising up to Rs 26,853 crore from Emirates NBD Bank subject to various regulatory filing, the bank said in a regulatory filing.

The board has approved the issue and allot, by way of a preferential issue of up to 95.90 crore fully paid up equity shares of the RBL Bank each having a face value of Rs 10, which is equivalent to 60 per cent of the post preferential equity share capital at a price of Rs 280 per unit aggregating to Rs 26,853 crore to NBD Bank, it said.

The board approval for stake sale comes at a time when RBL Bank posted a 20 per cent decline in the second quarter profit at Rs 179 crore as against Rs 223 crore in the July-September period of the previous year.

In connection with the preferential issue, the board approved the execution by the bank of an investment agreement with NBD Bank dated October 18, 2025, it said.

Upon consummation of the preferential issue contemplated under the investment agreement, NBD Bank will acquire control over the RBL Bank and will be classified as a promoter and the acquired bank will be classified as a subsidiary of a foreign bank, subject to necessary regulatory approvals, it said.

The preferential issue has triggered an obligation on NBD Bank to make an open offer to the shareholders of the RBL Bank in terms of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended, it said.

It is one of the conditions precedent to the preferential issue that the aggregate foreign investment limits of the bank should be sufficient enough to enable the investor to acquire a minimum of 51 per cent of the total paid up share capital of the bank on the completion of the preferential issue.

As per the Scheme, the 'Appointed Date' shall be April 1, 2026, or such other date as may be fixed mutually by the transferor company and the bank and sanctioned by the RBI, it said.

Subject to the approval of shareholders and receipt of approval from the RBI, the board has approved the increase in the authorised share capital of the bank from Rs 1,000 crore to Rs 1,800 crore, it said.

Besides, the filing also said RBI vide its letter dated October 17, 2025, granted its approval to acquire aggregate holding in Utkarsh Small Finance Bank Ltd (USFB), accruing on account of upcoming rights issue by USFB as well as Bank's indirect holding in Utkarsh Coreinvest Ltd with USFB.

This is in response to an application made by RBL Bank to Reserve Bank of India (RBI) on October 8, 2025, it said.

The approval granted by RBI is subject to compliance with the relevant provisions of the Banking Regulation Act, 1949, RBI's Master Direction and Guidelines on Acquisition and Holding of Shares or Voting Rights in Banking Companies dated January 16, 2023, provisions of the Foreign Exchange Management Act, 1999 among others, it said.

The approval is also inter alia subject to ensuring that the "aggregate holding" of the RBL Bank in USFB shall remain below 10 per cent of the paid-up share capital or voting rights of USFB, at all times, it said.

About NBD Bank's deal, RBL Bank in a statement said that the landmark transaction represents a strong vote of confidence in the bank's business model, governance, and growth potential.

The partnership will significantly strengthen RBL Bank's capital base, enhance its Tier-1 ratio, and provide long-term growth capital to deepen its deposit franchise and expand its footprint across India, it said.

Backed by Emirates NBD's global expertise, robust credit rating, and regional network, RBL Bank is poised to accelerate its transformation journey, deliver superior value to stakeholders, and emerge as a stronger, future-ready institution, it said.

RBL Bank, MD & CEO R Subramaniakumar said this partnership secures a robust and globally respected anchor shareholder, providing a strong capital base for our future. "We are excited about the synergies this alliance will create and are confident that our combined strengths will deliver superior value to all the stakeholders of the bank." PTI DP HVA