Uday Kotak loses ₹10,225cr as Kotak Bank's share price plummets
Uday Kotak, the non-executive director of Kotak Mahindra Bank since January 1, 2024, has experienced a significant loss of wealth today. The bank's share price plummeted by 10.85%, closing at ₹1,643 on the Bombay Stock Exchange (BSE) following RBI's curbs. This steep decline resulted in an estimated loss of around ₹10,225 crore for Kotak, who holds a substantial 25.71% stake in the bank.
RBI's ban on Kotak Bank's digital onboarding, credit card issuance
The Reserve Bank of India's ban on Kotak Mahindra Bank's digital onboarding and credit card issuance sparked the fall in share prices. The bank's market capitalization also took a hit, dropping from ₹3,66,383.76 crore at Wednesday's close to ₹3,26,615.40 crore by Thursday's end. This decrease resulted in shareholders losing a staggering ₹39,768.36 crore in value.
Mutual funds, insurance companies also face losses
Mutual funds, which hold about a 12.82% stake in Kotak Mahindra Bank, are estimated to have lost nearly ₹5,100 crore. Insurance companies with an 8.69% stake also faced losses due to the share price drop. The RBI announced restrictions on Kotak Mahindra Bank after it identified serious deficiencies and non-compliances in the private lender's IT inventory management, user access management, vendor risk management, data security, data leak prevention strategy, and disaster recovery rigor.
