Kotak Mahindra Bank Shares Slump After RBI Ban on New Online Clients
By Kosaku Narioka
Kotak Mahindra Bank shares fell sharply after India's central bank barred it from taking on new clients through online channels and issuing new credit cards.
Shares were recently 9.7% lower at 1,664.25 rupees ($19.97) on Thursday after falling as much as 12% earlier.
The Reserve Bank of India said Wednesday that it directed Kotak not to add new customers through its online and mobile banking channels and issue new credit cards, citing concerns about the commercial bank's information-technology infrastructure.
The central bank said Kotak had deficiencies and noncompliances in the areas of user access management, data security and data-leak prevention strategy, among others.
Kotak said it has taken steps to adopt new technologies to strengthen its IT systems and will continue to work with the central bank to resolve the issues as soon as possible.
The commercial bank believes the RBI's actions won't materially impact its overall business, it said.
Kotak said it will continue to serve its existing clients and onboard new customers at its branches.
Write to Kosaku Narioka at kosaku.narioka@wsj.com
(END) Dow Jones Newswires
April 25, 2024 02:07 ET (06:07 GMT)
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