Emirates NBD charts next phase of India expansion after RBL deal

From a UAE perspective, the relationship with India is particularly significant. Indians account for about 35-40% of the UAE’s population, and the two countries have built a strong economic partnership, supported by robust trade agreements. India is the UAE’s second-largest trading partner, while the UAE is India’s third largest.

This strong bilateral relationship is also translating into growing investment flows, with several UAE-based institutions and businesses exploring or expanding their presence in India or vice versa. Recent transactions and investments by players such as ADIA, Mubadala and IHC are further indicators of the growing confidence and long-term interest in the Indian opportunity.

What gave you the confidence to undertake the RBL transaction?

When evaluating the India opportunity… one of the key exercises we undertook was to study China’s growth story and the corresponding growth of its banks. We looked at where some of its leading banks stood in 2000 and how they had grown over the following two decades.

Some Indian banks today have asset bases of $50-100 billion, while their Chinese counterparts, which were at a similar scale in 2000, have since grown nearly 17-20x to $1 trillion to $1.3 trillion. This gave us a sense of the potential ahead and the possibility of 15-20x growth over the long term.

What does the country need to support that growth?

India’s GDP grew by around 7-8% in FY26, ahead of several estimates. Sustaining this growth requires a strong banking system and significant capital. This capital can come either from the government or private investors. Unlike China, where the government played a major role in funding growth, we see India relying increasingly on domestic and foreign private capital, including investors like us.

Take us through how you approached India as your next area of deployment…

India should not be viewed as a homogeneous market, but rather through the lens of its distinct customer segments. While the top 0.5% represents the high-net-worth segment, our primary focus is the approximately 350 million people spanning the middle class to the affluent segment, which represents our natural sweet spot as a bank.

Beyond the growth of India’s middle class, we also looked at a range of other indicators, including purchasing power parity. According to third-party research, an estimated 50 million people in India today have incomes equivalent to $50,000 or more on a PPP basis, with this segment projected to grow to around 130-150 million over the next five to seven years.

Our India expansion journey actually began with another asset before we entered the RBL process. One thing that has always been consistent in our strategy, as reflected in our past acquisitions, is that we prefer to acquire businesses with control. Most of our previous acquisitions have been 100% buyouts. In India, that was however not possible.

At the same time, we recognize our responsibility to support broader economic growth and meet priority-sector lending requirements. We therefore intended to build a balanced franchise that serves our target customers while fulfilling our regulatory obligations and contributing meaningfully to India’s growth story.

What were the discussions in the lead up to the RBL transaction?

Historically, foreign interest in India’s banking sector was fairly limited. However, as the segment grew over the last five to seven years, the country saw greater interest from international strategics.

Earlier, most foreign investment came from private equity funds, which typically have fixed investment horizons. From a regulator’s perspective, this may raise concerns about the long-term stability of banks when these investors eventually exit. Our approach was different. We wanted to invest for the long term, and that was the message we communicated to the government.

Why RBL? How are you thinking of scaling the asset today?

RBL’s scale was one of the factors that made it particularly attractive to us. It gave us the opportunity to enter India in a measured way while retaining the flexibility to shape and grow the bank around our strategy. The initial capital commitment was also more manageable compared with some of the other opportunities we considered. Another important consideration was that our investment was going directly into the bank, providing fresh capital that can now be used to support and accelerate RBL’s growth.

When we first engaged with RBL, it had around 550 branches. Today, that number has grown to approximately 620-630. We are also discussing further expansion in markets where we see strong remittance flows with links from significant Indian diaspora, as well as opportunities to grow our commercial banking and trade finance businesses.

Are you thinking of bolt-ons for the asset? What are the gaps?

We see opportunities to strengthen RBL’s existing platform through bolt-on acquisitions. There are a few gaps in its current offering, particularly in wealth management, investment banking and other ancillary businesses. On the corporate banking side, RBL has largely focused on mid-sized corporates and has had limited access to larger clients due to its higher cost of funding and the resulting margin constraints.

On the retail side, RBL already has a well-established credit card business, and we see opportunities to create greater alignment and synergies with the bank’s broader retail platform… Any future acquisitions would focus on adjacent businesses such as investment banking, institutional equities, retail broking, wealth management and asset management. We believe some of these capabilities are better acquired, while others can be built organically.

What kind of synergies do you anticipate between Emirates NBD and RBL?

Emirates NBD has over 900,000 NRI customers out of a total customer base of around 2.4 million, with Indians accounting for nearly 40% of our customers. Last year alone, we processed approximately $2.8-2.9 billion in retail remittances. With 4 million plus NRIs in the UAE and another 2.5 million in Saudi Arabia, where we also have a strong presence, we see a significant opportunity. By offering this customer base a seamless channel to remit, hold and invest their money in India, we can tap into a large, existing market.

Can you elaborate on Emirates NBD’s investment banking arm?

We are now looking to strengthen our investment banking business. We had secured the license and set up the unit even before the RBL transaction but had taken a measured approach as we were simultaneously evaluating other opportunities. With RBL not having an investment banking arm, we now see an opportunity to build this vertical, expand the team and bring in experienced talent.

In advisory and ECM, the key is to bring in the right people. Institutional equities, however, requires greater scale, strong institutional relationships, and an established brokerage platform. Therefore, acquiring an existing institutional equities or retail broking capability could make sense.

How will RBL leverage Emirates NBD’s backing?

We are among the most technologically advanced banks globally and are one of the few banks of our size to be fully cloud native. We have built strong capabilities in AI and digital banking, following a major technology transformation at Emirates NBD between 2017 and 2020, during which we made significant investments in our technology platforms. These capabilities now allow us to operate more efficiently and deliver a seamless customer experience, and we intend to bring them to RBL.

Technology and systems will be two key areas of investment. One of the things we liked about RBL was that three of its key existing technology platforms are common with us. This gives us a strong foundation to build on, although some integration across other systems will still be required.

What kind of returns are you expecting from the investment?

Indian banks typically deliver RoEs of around 12-15% and ROAs of 1.5-2%. Naturally, we would want RBL to reach similar levels of performance, with a potential to do even better over time. However, this will take time, and that is our long-term ambition.

Tell us about your venture arm.

Our corporate venture fund was established in 2023 with a corpus of $100 million. We typically invest between $0.5 million and $5 million in Series A, Series B and early-stage startups. We have been evaluating opportunities in India even before entering the market and are now actively exploring investments here.

A key principle of our corporate venture strategy is that every investment should have a potential use-case within the bank, either in our existing markets or in the future. We focus on fintech and startups offering technology, products or services that can add value to our banking operations.

So far, we have made around 10 investments across blockchain, AI and digital platforms, spanning Switzerland, Singapore, Israel, the UAE, and Turkey with a couple more in the pipeline. India is an emerging focus, and we expect to explore more opportunities now that we have a larger presence here.

Priyamvada C

Priyamvada is a Mumbai-based business journalist at Mint. She writes about the public and private markets with a key focus on venture capital, private equity, M&As and private credit. Her coverage also spans startups and emerging businesses.Over the last two years, she has uncovered some of the largest deals and interviewed important decision-makers from India’s investment ecosystem. She likes to dabble across different formats like long forms and explainers. Her work has been consistently displayed on the publication's deals page, and she has also written multiple front-page stories.Prior to joining Mint in 2024, she worked out of Reuters’ Bengaluru bureau where she extensively covered the travel, transportation, and logistics industries. Across both her stints, Priyamvada has displayed rigour for breaking news and analyzing interesting data-driven trends. She holds a postgraduate diploma from the Asian College of Journalism's Bloomberg programme. In her free time, she enjoys reading books and trying out different cuisines. She is keen to delve deeper into the various sectors she covers and is always up for a chat. You can reach out to her at priyamvada.c@livemint.com.