Blackstone Invests $705 Million in Federal Bank, Eyes Largest Shareholder Spot
Blackstone is set to make a bold move in India’s financial market. The investment giant plans to invest 705 million in Federal Bank, aiming to become its largest shareholder. The deal highlights growing global interest in India’s thriving banking sector.
This investment will happen through a Singapore-based Blackstone affiliate. The affiliate has signed a share-purchase agreement with Federal Bank. As part of the deal, Blackstone will also gain the right to nominate a non-executive director to the bank’s board.
Growing Foreign Interest in Indian Banks
Dealmaking in India’s private banking space has gained strong momentum this year. Several global institutions are taking positions in leading Indian banks.
For example, Emirates NBD, a Dubai-based bank, recently bought a 60% stake in RBL Bank for $3 billion. In addition, Japan’s Sumitomo Mitsui Banking Corporation acquired a 20% stake in Yes Bank in May and added another 4.2% in September.
These deals show rising confidence in India’s financial system. Foreign investors are betting on long-term growth, driven by strong domestic demand and digital banking innovation.
What’s Next for Federal Bank
The deal between Blackstone and Federal Bank will be carried out through preferential equity shares and warrants. However, it still requires approvals from shareholders and regulatory bodies, including banking and competition authorities.
The Federal Bank has already called for an extraordinary general meeting (EGM) on November 19. During this meeting, shareholders will vote on the proposed share issue and board nomination.
If approved, the move will strengthen Federal Bank’s capital base and global partnerships. For Blackstone, it marks a strategic step toward deeper involvement in India’s fast-growing financial ecosystem.
As a result, both institutions stand to benefit — one through fresh capital and expertise, the other through access to a promising emerging market.
