UK-based Hinduja Group-promoted IndusInd Bank has struck a deal to acquire Deutsche Bank’s loss-making credit card business in India for an undisclosed sum. Earlier media reports had named Axis Bank, ICICI Bank, Standard Chartered, Dhanlaxmi Bank and Karnataka Bank besides IndusInd as suitors for the credit card business of Deutsche Bank, some of whom had backed out over differences related to valuation.
Under the agreement, IndusInd will get access to close to 2 lakh credit card customers of the German bank in India and the entire operating platform of the cards franchise, including talent and technology.
IndusInd Bank managing director and chief executive Romesh Sobti said, “This will accelerate the launch of credit cards which we consider a critical link in our suite of consumer banking products.”
Commenting on the deal, Deutsche Bank Asia Pacific head for credit cards Shameek Bhargava said, “We have built a quality premium credit card business in India. IndusInd’s widespread footprint makes them an ideal choice to take this business forward. We are committed to working with IndusInd to ensure a smooth transition for clients and other stakeholders.”
IndusInd consumer banking head Sumant Kathpalia said, Deutsche Bank has a stable cards portfolio and the acquisition gives IndusInd a head start in building the cards business.
IndusInd already has an established debit card business and the acquisition will plug another gap in its consumer banking offerings. Last November, it had roped in Anil Ramachandran as its Head Credit Cards Business. Ramachandran was roped in from Deutsche Bank heading the credit cards business in India and could have been partly instrumental in striking the deal with the German bank.
For Hindujas, this comes even as they have virtually lost their proposed $1.9-billion acquisition of Luxembourg-based KBL European Private Bankers. That deal for the private banking arm of Belgium’s KBC Group hit a roadblock with the local regulator.