Emirates NBD gets RBI in-principle nod to set up wholly owned subsidiary

Dubai-based Emirates NBD has received RBI's in-principle approval to convert its three India branches into a wholly owned subsidiary to deepen domestic banking services

The Reserve Bank of India (RBI) has granted in-principle approval to Emirates NBD Bank PJSC to establish a wholly owned subsidiary (WoS) in India, the regulator announced on Monday.

 

The Dubai-headquartered lender currently operates through three branches in India—located in Chennai, Gurugram, and Mumbai.

 

The in-principle approval has been granted for setting up the WoS by converting its existing branches into a single subsidiary structure.

 

“The RBI would consider granting a licence for commencement of banking business in WoS mode … on being satisfied that the bank has complied with the requisite conditions laid down by RBI as part of the ‘in-principle’ approval,” the central bank said.  Media reports suggested Emirates NBD, among others, are eying majority stake in IDBI Bank. The government has started the process of disinvestment of IDBI Bank. The government is offering 30.48 per cent stake while Life Insurance Corporation will sell 30.24 per cent stake. RBI is currently evaluating fit and proper criteria of the investors, the finance ministry had informed Lok Sabha in February this year. Earlier this month, financial services secretary M Nagaraju had said stake sale in IDBI Bank will be completed in 2025. 

 

Emirates NBD is one of the few foreign banks to receive regulatory clearance via the wholly owned subsidiary route. Other lenders operating in India through this model include DBS Bank India and SBM India. Foreign banks operating under the WoS framework are treated on par with domestic banks for branch expansion, exempt from requiring regulatory approvals, subject to specific conditions.

 

Emirates NBD inaugurated its first full-fledged Indian branch in Mumbai in 2017, making India the sixth country in which the bank has an onshore presence, after the UAE, Saudi Arabia, Egypt, Singapore, and the United Kingdom.

 

In October 2021, the MENAT (Middle East, North Africa, and Turkey) region-based banking group announced plans to expand its Indian operations further, following RBI approval to open two additional branches in Chennai and Gurugram.

 

The bank’s Indian branch offers a range of services to corporate, SME, and institutional clients, including trade finance, treasury services, and bilateral and syndicated loans. It also supports non-resident Indian (NRI) customers seeking cross-border wealth management solutions.