The deal is expected to be accretive to the return on equity for KMB and capital accretive for Deutsche Bank.
| Photo Credit: Reuters

The stock slipped 3.14% to Rs 396.15 on the BSE.
| Photo Credit: The Hindu

Representative image
| Photo Credit: Getty Images/iStockphotos

A man walks past the Kotak Mahindra Bank branch in New Delhi. File
| Photo Credit: Reuters

 Kotak Mahindra Bank Ltd for the second quarter ended September 30, 2024 reported 5% year-on-year growth in net profit at ₹3,344 crore.

Net Interest Income (NII) increased to ₹7,020 crore, up 11% Y-o-Y. Net Interest Margin (NIM) was 4.91% for the quarter.

Gross non-performing assets (NPA) has decreased to ₹6,033 crore as on the end of the quarter from ₹6,087 crore a year ago.

However net NPA has gone up to ₹1,724 crore from ₹1,275 crore in the year ago period. Provisions during the quarter increased to ₹660 crore from ₹367 crore a year ago. Customer Assets, which comprised advances and credit substitutes increased by 18% Y-o-Y to ₹ 450,064 crore.

Advances increased 17% Y-o-Y to ₹4,19,108 crore. Unsecured retail advances (incl. retail microcredit) as a of net advances stood at 11.3% as at September 30, 2024.

Average total deposits grew to ₹4,46,110 crore, up 16% Y-o-Y. Capital Adequacy Ratio of the bank, as per Basel III, as at September 30, 2024 was 22.6% and CET1 ratio of 21.5% (including unaudited profits).

The bank’s consolidated net profit grew 13% to ₹5,044 crore as compared with ₹ 4,461 crore in the year ago period.

At the consolidated level, Return on Assets (ROA) for Q2FY25 (annualized) was 2.53% compared with 2.68% for the same period last year. Return on Equity (ROE) for Q2FY25 (annualized) was 13.88% as compared with 14.99% for the same period last year.

Consolidated Capital Adequacy Ratio as per Basel III as at September 30, 2024 was 22.6% and CET I ratio was 21.7% (including unaudited profits), the bank said in a filing . 

Consolidated Networth as at September 30, 2024 was ₹1,47,214 crore (including increase in reserves due to RBI’s Master Direction on Bank’s investment valuation of ₹4,777 crore and gain on KGI divestment of ₹2,730 crore). 

Consolidated customer assets which comprises advances and credit substitutes grew to ₹5,10,598 crore as at September 30, 2024 from ₹4,28,404 crore as at September 30, 2023, up 19% Year-on-Year (Y-o-Y).

Total Assets Under Management as at September 30, 2024 were ₹6,80,838 crore up 37% YoY.

Kotak Asset Management, the 5th largest AMC saw its Domestic MF Equity AUM increase by 60% YoY to ₹ 319,161 crore as at September 30, 2024.

According to exchange data, equities worth ₹9,791.93 crore were sold by FIIs on Monday, September 30, 2024, while Domestic Institutional Investors DIIs purchased equities valued at ₹6,645.80 crore. File
| Photo Credit: Reuters

Benchmark indices Sensex and Nifty edged lower on Tuesday (October 1, 2024), extending the losing run to the third day amid profit-taking in oil & gas and select FMCG shares.

The BSE Sensex dipped 33.49 points or 0.04% to settle at 84,266.29. During the day, it hit a high of 84,648.40 and a low of 84,098.94.

The NSE Nifty closed marginally lower by 13.95 points or 0.05% to 25,796.90.

Muted trends in global markets and heavy foreign fund outflows weighed on investor sentiment, analysts said.

From the 30 Sensex firms, IndusInd Bank, Asian Paints, Hindustan Unilever, Tata Motors, Tata Steel, Titan, Reliance Industries and NTPC were among the major laggards.

Tech Mahindra, Mahindra & Mahindra, Kotak Mahindra Bank, Infosys, HCL Technologies and State Bank of India were among the major gainers.

In Asian markets, Tokyo settled higher. South Korea, Hong Kong and mainland Chinese markets are closed for a public holiday on Tuesday (October 1, 2024). Markets in mainland China will be closed for the rest of the week due to holiday.

European markets were trading on a mixed note. The U.S. markets ended in the positive territory on Monday (September 30, 2024).

Foreign Institutional Investors (FIIs) offloaded equities worth ₹9,791.93 crore on Monday (September 30, 2024), while Domestic Institutional Investors (DIIs) bought equities worth ₹6,645.80 crore, according to exchange data.

India’s manufacturing sector growth fell to an eight-month low in September amid softer increase in factory production, sales and new export orders, a monthly survey said on Tuesday (October 1, 2024).

The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) fell from 57.5 in August to 56.5 in September, registering the weakest pace of growth since January.

In PMI parlance, a print above 50 means expansion, while a score below 50 denotes contraction.

Global oil benchmark Brent crude declined 1.66% to $ 70.51 barrel.

The BSE benchmark tumbled 1,272.07 points or 1.49% to settle at 84,299.78 on Monday (September 30, 2024). During the day, it plunged 1,314.71 points or 1.53% to 84,257.14. The Nifty tanked 368.10 points or 1.41% to 25,810.85.

Image for representational purposes only.
| Photo Credit: PTI

Equity benchmark indices Sensex and Nifty ended lower on July 22, dragged down by heavy selling pressure in Reliance Industries and Kotak Mahindra Bank ahead of the Budget.

Besides, a weak trend in global equity markets also hit investors sentiment, traders said.

Falling for the second day in a row, the 30-share BSE Sensex fell 102.57 points or 0.13% to settle at 80,502.08. During the session, it tanked 504 points or 0.62% to 80,100.65.

The NSE Nifty dipped 21.65 points or 0.09% to 24,509.25. During the day, it dropped 168.6 points or 0.68% to 24,362.30.

Reliance Industries declined over 3% among the Sensex pack after the company reported a 5% drop in its June quarter net profit.

Kotak Mahindra Bank also fell more than 3% after its June quarter earnings failed to cheer investors.

ITC, State Bank of India, HCL Technologies and IndusInd Bank were the other big laggards.

NTPC, UltraTech Cement, HDFC Bank and Mahindra & Mahindra were among the gainers.

HDFC Bank climbed over 2% after the company’s consolidated net profit grew 33.17% to ₹16,474.85 crore in the June 2024 quarter.

In Asian markets, Seoul, Tokyo and Shanghai settled lower, while Hong Kong ended in the positive territory.

European markets were trading higher in the mid-session deals. U.S. markets ended lower in overnight trade on July 19

According to the Economic Survey, 2023-24 tabled in Parliament on July 22, capital markets are becoming more prominent in India’s growth story, with an expanding share in capital formation and investment landscape on the back of technology, innovation and digitisation.

Further, Indian markets are resilient to global geo-political and economic shocks, it added.

“Despite heightened geo-political risks, rising interest rates and volatile commodity prices, Indian capital markets have been one of the best performing among emerging markets in FY24,” the Economic Survey said.

Meanwhile, global oil benchmark Brent crude dipped 0.08 per cent to $82.53 a barrel.

Foreign Institutional Investors (FIIs) bought equities worth ₹1,506.12 crore on July 19, according to exchange data.

The BSE benchmark hit its new all-time high of 81,587.76 in the initial trade on July 19 but failed to carry forward the winning momentum and tanked 738.81 points or 0.9% to settle below the 81,000 mark at 80,604.65.

Nifty tumbled 269.95 points or 1.09% and ended at 24,530.90 after hitting its fresh record peak of 24,854.80 during the opening bell on July 19.

Share brokers watching stock prices at BSE Sensex and NSE Nifty at Calcutta Stock Exchange in Kolkata. File
| Photo Credit: PTI

Equity benchmark indices rebounded in early trade on Monday following a rally in the U.S. markets and heavy buying in Kotak Mahindra Bank.

The 30-share BSE Sensex climbed 328.54 points to 74,206.69 in early trade. The NSE Nifty advanced 93.45 points to 22,569.30.

From the Sensex basket, Kotak Mahindra Bank jumped over 4% after the company reported a 25% growth in its March quarter net profit at ₹5,302 crore, limited by a drop in the core income due to narrow interest margins.

Tata Consultancy Services, JSW Steel, IndusInd Bank, ICICI Bank, Wipro and Axis Bank were among the other major gainers.

Titan, State Bank of India, Power Grid and Larsen & Toubro were the laggards.

In Asian markets, Shanghai and Hong Kong were trading in the positive territory.

Wall Street ended with significant gains on Friday.

Billionaire investor Warren Buffett said that the Indian market has “unexplored” opportunities which his conglomerate holding company, Berkshire Hathaway, would like to explore “in the future”.

Mr. Buffett’s remarks came at Berkshire’s annual meeting on Friday when Rajeev Agarwal of DoorDarshi Advisors, a U.S.-based hedge fund that invests in Indian equities, asked him about the possibility of Berkshire exploring in India, the world’s fifth-largest economy.

“Positive comment by Warren Buffett that India is an untapped market with great potential is hugely important. FIIs can take a cue from that rather than react every time to changes in U.S .bond yields,” said V.K. Vijayakumar, chief investment strategist, Geojit Financial Services.

The U.S. jobs data for April has come lower-than-expected indicating a weakening labour market and slowing economy, Mr. Vijayakumar said.

“U.S. unemployment has risen to 3.9% in April. So the possibility of a rate cut by the Fed has again brightened. The decline in the dollar index to 105.8 and the cut in the 10-year U.S. bond yield to 4.49% augur well for the market,” he added.

Global oil benchmark Brent crude climbed 0.23% to $83.15 a barrel.

Foreign Institutional Investors (FIIs) offloaded equities worth ₹2,391.98 crore on Friday, according to exchange data.

The BSE benchmark dropped 732.96 points or 0.98% to settle at 73,878.15 on Friday. The NSE Nifty also declined 172.35 points or 0.76% to 22,475.85.

Uday Kotak built his Kotak Mahindra Bank Ltd. over decades to become Asia’s richest banker. After India’s regulator slapped his bank with a surprise ban, he’s facing one of his biggest tests yet – and a dip in wealth.

The lender’s shares tumbled as much as 13% on Thursday after it was barred from adding new customers through its digital channels and from issuing fresh credit cards. As the largest shareholder with a stake of almost 26%, the billionaire founder bore the heaviest brunt from the selldown, the most in four years. 

That saw his wealth decline by $1.3 billion, according to the Bloomberg Billionaires Index. He was worth $14.4 billion as of April 24.

Rival Axis Bank Ltd. overtook Kotak’s market capitalization for the first time since Sept. 2016. Axis’ shares had surged after its earnings beat analysts’ estimates. 

The Reserve Bank of India cited governance and risk issues about Kotak’s technology systems as reasons behind its ban. It found deficiencies and non-compliance in various processes over two years – from a lack of data security and leak prevention strategies to vendor risk management  – according to a statement late Wednesday. 

Kotak said in response that it has taken measures for “adoption of new technologies to strengthen its IT systems and will continue to work with RBI to swiftly resolve balance issues at the earliest.”

It’s not Kotak’s first run-in with the regulator. The billionaire previously took India’s central bank to court over the size of his stake in the lender. Kotak ultimately agreed to reduce his ownership in 2020, ending the feud.

New CEO

It was only at the start of this year that Kotak handed the reins over to new Chief Executive Officer Ashok Vaswani. Vaswani has said scale will be critical for the bank’s growth, and that the lender has been investing in technology.

Kotak, a native of the western state of Gujarat, set up an investment company in 1985 with a 3 million rupee loan ($41,000) from family and friends and partnered with Mahindra the following year.

The financier was Kotak Mahindra Bank’s CEO since its beginning and gained more control of it in 2006 by ending a partnership of more than a decade with Goldman Sachs Group Inc. 

Almost 98% of the transaction volume in Kotak’s savings accounts were by digital or non-branch methods, according to its most recent investor presentation for the quarter ended Dec. 31.

“The ban on online customer acquisition will have an impact on Kotak Mahindra Bank’s growth as it is one of the slowest lenders for physical branch expansions,” said Ashutosh Mishra, banking analyst at Ashika. “The RBI ruling will create a negative sentiment on the bank.”

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

New Delhi:

Infina Finance, one of the promoter group entities of Kotak Mahindra Bank – currently facing RBI action, had donated electoral bonds worth Rs 60 crore to the BJP.

Infina Finance, owned by the Kotak family, is listed as one of the promoter group entities of Kotak Mahindra Bank. However, it owns no shares in the private sector lender, which the RBI has barred from issuing fresh credit cards.

As per the shareholding data with the BSE, as of March 2024, the promoter and promoter group entities hold a 25.89 per cent stake in Kotak Mahindra Bank.

Uday Kotak is the promoter and single largest shareholder of Kotak Mahindra Bank, with a 25.71 per cent stake. Other promoter group entities hold the remaining 0.18 per cent stake.

The Mumbai-based Infina Finance donated electoral bonds worth Rs 60 crore to the Bharatiya Janata Party (BJP). The NBFC firm purchased these bonds in the denomination of Rs 1 crore in 2019, 2020 and 2021, according to the data given by the State Bank of India (SBI) to the Election Commission. The data was made public last month.

Infina Finance Private Ltd, according to its website, was incorporated in 2008 and is in the business of capital market financing and proprietary trading and investments.

Infina, a non-deposit accepting, systemically important non-banking financial company registered with the RBI, had reported a profit of Rs 105.55 crore in 2022-23. The firm posted a total income of Rs 227.84 crore during the fiscal.

On Wednesday, the Reserve Bank of India (RBI) barred Kotak Mahindra Bank from onboarding new customers through its online and mobile banking channels and issuing fresh credit cards with immediate effect after the regulator found “serious deficiencies” in the lender’s IT risk management.

These actions, the RBI said, are necessitated based on significant concerns arising out of the Reserve Bank’s IT examination of the bank for the years 2022 and 2023, and its continued failure to address these concerns in a comprehensive and timely manner. 

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

New Delhi:

Hours after the Reserve Bank of India prohibited Kotak Mahindra Bank from onboarding new customers online and issuing fresh credit cards, citing issues with the company’s data security and information technology infrastructure, the bank has said it is adopting new technologies and strengthening its IT systems.

It also assured existing customers that services will continue without any disruptions and said new customers can be onboarded at its branches. 

READ | RBI Curbs On Kotak Mahindra Bank: No New Online Customers, Credit Cards

“We have received an order from the RBI which directs us to temporarily pause onboarding of new customers though our online and mobile banking channels and issuance of fresh credit cards. The Bank has taken measures for adoption of new technologies to strengthen its IT systems and will continue to work with RBI to swiftly resolve balance issues at the earliest,” Kotak Mahindra Bank said in a statement. 

“We want to reassure our existing customers of uninterrupted services, including credit card, mobile and net banking. Our branches continue to welcome and onboard new customers, providing them with all the Bank’s services, apart from issuance of new credit cards,” it added. 

READ | Should Existing Kotak Mahindra Bank Customers Be Worried Over RBI Curbs?

In a release earlier on Wednesday, RBI had said “significant concerns” had come to the fore in its IT examination of Kotak Mahindra Bank last year and in 2022, and that the bank had failed to address the concerns in a “comprehensive and timely manner”.

“Serious deficiencies and non-compliances were observed in the areas of IT inventory management, patch and change management, user access management, vendor risk management, data security and data leak prevention strategy, business continuity and disaster recovery rigour and drill, etc. For two consecutive years, the bank was assessed to be deficient in its IT Risk and Information Security Governance, contrary to requirements under Regulatory guidelines,” the central bank said.