IDFC First Bank to Raise Rs 75 Bn from Warburg Pincus and ADIA
18 Apr 2025
2 Min Read
CW Team
IDFC FIRST Bank has announced a plan to raise approximately Rs 75 billion by issuing preferential shares to affiliate companies of Warburg Pincus and the Abu Dhabi Investment Authority (ADIA). The bank will receive an investment of Rs 48.76 billion from Currant Sea Investments B.V., an affiliate of Warburg Pincus, for a 9.8 per cent stake, while Platinum Invictus B 2025 RSC, a wholly-owned subsidiary of ADIA, will invest Rs 26.24 billion for a 5.1 per cent stake.
The bank has undergone a significant transformation over the past six years, transitioning from an infrastructure-focused development financial institution (DFI) to a modern, technology-driven, pan-India universal bank. This evolution has involved substantial investments in distribution, technology, and talent, positioning IDFC FIRST Bank as a leading private sector bank in India. As a result, the bank has seen its deposits grow six-fold, its loans and advances double, and its CASA ratio improve dramatically from 8.7 to 47.7 per cent. Additionally, its profit after tax (PAT) rose from a loss of Rs 19.44 billion in FY19 to a profit of Rs 29.57 billion in FY24.
Despite a dip in profitability during 9MFY25, primarily due to challenges in the microfinance sector, the bank has navigated these hurdles effectively. With the new fund raise, its capital adequacy ratio is expected to increase from 16.1-18.9 per cent, with a CET-1 ratio of around 16.5 per cent, further strengthening its balance sheet and positioning the bank for sustainable growth.
This strategic funding aims to support IDFC FIRST Bank's continued expansion, enhance its technology infrastructure, and cater to the growing demand for financial products in India.
News source: Financial Express
IDFC FIRST Bank has announced a plan to raise approximately Rs 75 billion by issuing preferential shares to affiliate companies of Warburg Pincus and the Abu Dhabi Investment Authority (ADIA). The bank will receive an investment of Rs 48.76 billion from Currant Sea Investments B.V., an affiliate of Warburg Pincus, for a 9.8 per cent stake, while Platinum Invictus B 2025 RSC, a wholly-owned subsidiary of ADIA, will invest Rs 26.24 billion for a 5.1 per cent stake.
The bank has undergone a significant transformation over the past six years, transitioning from an infrastructure-focused development financial institution (DFI) to a modern, technology-driven, pan-India universal bank. This evolution has involved substantial investments in distribution, technology, and talent, positioning IDFC FIRST Bank as a leading private sector bank in India. As a result, the bank has seen its deposits grow six-fold, its loans and advances double, and its CASA ratio improve dramatically from 8.7 to 47.7 per cent. Additionally, its profit after tax (PAT) rose from a loss of Rs 19.44 billion in FY19 to a profit of Rs 29.57 billion in FY24.
Despite a dip in profitability during 9MFY25, primarily due to challenges in the microfinance sector, the bank has navigated these hurdles effectively. With the new fund raise, its capital adequacy ratio is expected to increase from 16.1-18.9 per cent, with a CET-1 ratio of around 16.5 per cent, further strengthening its balance sheet and positioning the bank for sustainable growth.
This strategic funding aims to support IDFC FIRST Bank's continued expansion, enhance its technology infrastructure, and cater to the growing demand for financial products in India.
News source: Financial Express
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