The richest and the smartest banker in Forbes Billionaire – Uday Kotak

The only banker on Forbes Billionaires 2021 is the Managing Director and CEO of Kotak Mahindra Bank – Uday Kotak. The billionaire bankers wealth stands at USD 16.7 billion as of date.

Hailing from an upper middle Gujarati family, a young Kotak started a bank with a seed capital of USD 80,000 which went on to become India’s fourth-largest (by Market Capitalization) scheduled Commercial Bank and third largest among Private Commercial Banks. Kotak Mahindra Bank boasts a market capitalization of Rs 403,012 crore or USD 53.8 billion.

Uday Kotak has featured in the prestigious list of Forbes Billionaires 2020 at 129th spot, the same year he was the 8th richest in India, which is unchallenged to date. The fortune he has created is not a windfall but is a result of his grit, business acumen, foresightedness with an undercurrent to create value at large. His focus has been to make the financial service conglomerate sustainable and durable, not just by smart strategies but with unassailable governance.

The various milestones in the corporate lifecycle of Kotak Mahindra Bank from a bill discounting business to lease and hire purchase business, auto finance to investment banking to launch of India’s first Gilt Fund, bear testimony to its leader, Uday Kotak’s foresightedness and in perfect harmony of this mounting fortune.

In February 2003, Kotak Mahindra Finance Ltd. (KMFL), the Group's flagship company, received a banking license from the Reserve Bank of India (RBI), becoming the first non-banking finance company in India to convert into a bank - Kotak Mahindra Bank Ltd.

In November 2014, the accession of ING Vyasa Banks India operation in a USD 2.4 billion deal turned the tables for KMBL, cementing its position in the top 4 banks in the Private Sector. Owing to this, Kotak almost doubled his wealth by USD 2 billion as shares of his Kotak Mahindra Bank hit an all-time high. That year the bank picked up a 15 per cent stake in MCX, India's largest commodities exchange.

In 2015, Kotak Mahindra Bank Ltd (KMBL) forayed into the General Insurance business, upon receiving approval from the RBI. In a separate venture, he has teamed up with telecom magnate Sunil Mittal's Airtel M-Commerce to start a payments bank to provide basic banking services. That year Uday Kotak was ranked 12th richest Indian with a wealth of USD 6.5 billion.

In 2020, while the world was grappling with the harsh blows of the pandemic, KMBL had slowed down its growth engine, particularly on unsecured retail even before the COVID pandemic. It has consistently maintained a low net NPA below 1.5 per cent (second lowest) while an LCR ratio of 150 per cent and CASA Ratio of 53.7 per cent (highest among the banks). In June 2020, Kotak sold some shares to reduce his stake in the bank as mandated by the Reserve Bank of India. He featured in the Forbes Billionaire List 2020 at a valuation of USD 10.4 billion at 129th spot.

As of the quarter ended September 2021, Uday Kotak’s stake in KMPL stands at 26 per cent, as mandated by the RBI.

“As far as I'm concerned, becoming the world's richest banker is only a proxy for Uday being one of the world's smartest bankers," quipped Anand Mahindra, whose association with the banker dates back to 1986.