KMB UT2

completed

The project consists of a 15-year subordinated debt of up to $45 million for Kotak Mahindra Bank (KMB or the Bank). The IFC investment qualifies as Upper Tier II Capital per the guidelines recently issued by the Reserve Bank of India permitting banks to raise subordinated debt in foreign currency from foreign investors. KMB is an existing client of IFC and is a medium sized bank with total assets of $2.3 billion (unconsolidated figure for year ended March 31, 2006). It was founded by Mr. Uday Kotak as a Non Banking Finance Company in 1986 and converted into a full fledged commercial bank in 2003. It has built up a network of 100 branches across 69 cities and towns, offering financial services to SMEs, retail individuals and corporates. This investment is part of IFC’s strategy of supporting professionally run, medium sized private banks to emerge as strong players in the Indian financial sector.