The Reserve Bank of India (RBI) on Wednesday approved the merger of Kotak

Mahindra Bank and ING Vysya Bank. From now on, all ING branches will function as Kotak
branches, said the central bank.
The acquisition will make Kotak Mahindra Bank the fourth largest private sector lender in
the country, will have about 1,200 branches and a total business of Rs 2.25 lakh crore, as
on December 2014, and a combined market capitalisation of close to Rs 1.25 lakh crore.
Jaimin Bhatt, president & group chief financial officer, Kotak Mahindra, said there would be
a total of 30,000 employees in the bank after the merger, while at the group level, there
would be 40,000 employees.
In November 2014, Kotak Mahindra had announced it was acquiring Bengaluruheadquartered ING Vysya in an all-stock deal.
With respect to the branches, Bhatt said change at signage in ING Vysya branches had
already begun and the process would be completed within a month. For ATMs, too, the
same has started.
On employee rationalisation, Bhatt said, they were in a growth phase and would need
people for branch expansion. We will keep growing and would first utilise our combined
employee strength before hiring from external sources, he added.
On restructuring the existing branch network, he said the company would look into it. In
Mumbai, Delhi, Bengaluru and Chennai, the bank would expand its branch network. It would
also look at shifting branches to new locations, if necessary, he said.
In February, the proposed Rs 15,000-crore merger deal between Kotak Mahindra Bank
and ING Vysya Bank got the Competition Commission of Indias approval.
According to the fair trade regulator, the merger, which would create the countrys fourth
largest private sector lender, was not likely to have an appreciable adverse effect on
competition in India.
The deal implies a price of Rs 790 for each ING Vysya share, based on the average closing
price of Kotak shares during the month to November 19, valuing the deal at about Rs
15,000 crore. That was a 16 per cent premium to a like measure of ING Vysya market price,
Kotak Bank had stated.
After the merger, the ING Group, with a 6.4 per cent stake, will become the second-largest
shareholder in the bank. According to regulations, RBIs approval is required for an entity
other than the promoter to have more than five per cent stake in a bank.