Kotak Mahindra Bank to absorb lending subsidiary KMIL from April 1

Kotak Mahindra Bank will fold the business activities of its wholly owned subsidiary Kotak Mahindra Investments Limited (KMIL) into the bank's own operations from April 1, 2026, the lender said in a stock exchange filing on Tuesday.

The decision is driven by the need to comply with the Reserve Bank of India's (Commercial Banks — Undertaking of Financial Services) Directions, 2025, and is also aimed at simplifying the group structure and driving operational synergies.

KMIL's board has unanimously approved that the subsidiary will stop sanctioning new loans from April 1, 2026, while continuing to service its existing loan book and honouring all obligations under facility agreements executed on or before March 31, 2026.


The move is in line with RBI's stipulation that if a bank undertakes a particular form of business through more than one entity within its group, it must do so with a clearly documented rationale — such as business segmentation or specialisation — duly approved by the bank's board.

In financial terms, the consolidation is not expected to have a material impact. For FY2024-25, KMIL reported a net total income of Rs 795 crore and a profit after tax of Rs 501 crore under IGAAP, representing approximately 1% and 2.3% of the bank's consolidated net total income and profit after tax, respectively. Its net worth as of March 31, 2025 stood at Rs 3,842 crore, or approximately 2.4% of the bank's consolidated net worth.