SBI and Private Banks Sell 20% Stake in Yes Bank to SMBC for ₹13,482 Crore

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Posted by NewAdmin on 2025-05-12 12:22:11 |

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State Bank of India (SBI) and seven private sector banks have agreed to sell a 20 percent stake in Yes Bank to Sumitomo Mitsui Banking Corporation (SMBC) for ₹13,482 crore. This deal marks the largest cross-border transaction in the Indian banking sector. Alongside SBI, the private banks involved include HDFC Bank, ICICI Bank, Axis Bank, Kotak Mahindra Bank, Federal Bank, IDFC First Bank, and Bandhan Bank. The sale is subject to regulatory approvals from the Reserve Bank of India (RBI) and the Competition Commission of India (CCI). The transaction will see SMBC acquiring a 20 percent stake, with each of the eight banks selling their stake on a pro-rata basis, ensuring that SMBC's holding does not exceed the 26 percent threshold that would trigger a mandatory open offer under Securities and Exchange Board of India (SEBI) regulations.

The deal values Yes Bank at \$7.9 billion. SBI will offload 13.19 percent of its stake in Yes Bank for ₹8,889 crore, selling shares at ₹21.50 each, which is an 18 percent premium over the bank’s closing price on the day prior to the deal. The seven private banks will collectively sell 6.81 percent for ₹4,594 crore at the same price per share. Following the transaction, SBI will retain a 10.78 percent stake in Yes Bank, while the remaining private banks will collectively hold a 2.93 percent stake.

SMBC, a part of Sumitomo Mitsui Financial Group (SMFG), is a major foreign player in India’s banking sector. The Japanese bank expressed confidence in the growth potential of India’s economy and views the investment as an opportunity to contribute to Yes Bank’s future growth. This investment also reflects SMBC's commitment to building long-term, value-driven relationships in the region. Yes Bank’s CEO, Prashant Kumar, welcomed SMBC’s entry as a significant endorsement of the bank's transformation journey and its future potential.

This deal comes after Yes Bank underwent a significant reconstruction in 2020 when SBI and other banks rescued it from a financial crisis. As part of the restructuring, SBI and the private lenders injected capital into Yes Bank, which had previously faced major challenges, including the superseding of its board by the RBI.

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