Via app.dealroom.co
Bank of America to buy up to 49.9% of Jio Credit for $1.92 billion
The deal initially gives the US lender a 26.5% stake and values Jio Credit at about $3.8 billion.
Bank of America will invest 182.68 billion rupees, or $1.92 billion, for a stake of up to 49.9% in Jio Credit, the non-bank lending arm of Jio Financial Services, as the US lender expands in India.
The deal will initially give Bank of America a 26.5% stake through a preferential allotment of equity shares, with its holding potentially rising to 49.9% after it exercises warrants. Jio Credit will issue shares worth up to 66.13 billion rupees and warrants worth up to 116.55 billion rupees.
The transaction values Jio Credit at about $3.8 billion, according to a Reuters calculation. Bank of America will become a joint-venture partner in the non-banking finance company.
Bank of America CEO Brian Moynihan said combining Jio Financial’s local scale, expertise, and customer base with the US bank’s global reach and digital experience could expand access to financial services and support India’s economic growth.
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Jio Credit had more than $3 billion in assets under management as of the end of June after two years of operations. India’s non-bank credit market is growing at more than 14% across personal loans, gold loans, and small-business credit.
The investment follows other foreign deals in India’s financial sector, including MUFG’s investment in Shriram Finance, Emirates NBD’s purchase of a 60% stake in RBL Bank, and Sumitomo Mitsui Financial Group’s investment in Yes Bank.
Jio Financial listed in 2023 after separating from Reliance Industries and operates digital lending, payments, insurance broking, and asset management businesses. It also has asset and wealth management joint ventures with BlackRock and an insurance joint venture with Allianz.