Uday Kotak Over the course of decades, Uday Kotak turned his Kotak Mahindra Bank Ltd. into Asia’s richest bank. After India’s regulator imposed a sudden ban on his bank, he is facing one of his most difficult tests yet, as well as a decline in wealth.
The lender’s shares fell as much as 13% on Thursday after being prevented from recruiting new customers through its internet platforms and issuing new credit cards. As the largest shareholder, with a stake of about 26%, the billionaire founder absorbed the brunt of the selloff, the largest in four years.
Uday Kotak The chairperson
According to the Bloomberg Billionaires Index, his wealth has decreased by $1.3 billion. On April 24, his net worth was at $14.4 billion.
Regarding the additional shareholders, mutual funds own approximately 12.82 percent of Kotak Mahindra Bank. Mutual funds are believed to have lost about ₹5,000 crore due to the significant decrease in share prices.
Insurance companies own 8.69 percent of Kotak Mahindra Bank, with the Life Insurance Corporation of India owning 6.46 percent. Insurance firms will lose approximately ₹3,456 crore when the bank’s share price falls. The share price correction has reduced Life Insurance Corporation of India’s net worth by approximately ₹2,569 crore.
This implies that the near-term upside for Kotak Mahindra Bank’s share price may be constrained, restricting gains for all investors.
Kotak bank New technologies
Mr Kotak responded by noting that it has “adopted new technologies to strengthen its IT systems and will continue to work with the RBI to resolve balance issues as soon as possible.”
It’s not Mr Kotak’s first encounter with the regulator. The billionaire previously sued India’s central bank over the amount of his shareholding in the firm. Mr Kotak eventually decided to lower his ownership in 2020, effectively resolving the feud.