Japan's Sumitomo Mitsui Banking Corp (SMBC) has entered into a definitive agreement on May 9, 2025 to acquire 20% stake in Yes Bank through a secondary stake purchase of 13.19% from SBI and 6.81% aggregate stake from other banks for Rs 13,483 crore at Rs 21.5 per share.
State Bank of India will sell the 13.19% stake for Rs 8,889 crore while the other banks together will sell the 6.81% stake for Rs 4,594 crore.
The other banks include Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank and Kotak Mahindra Bank.
On May 9, Yes Bank's shares on BSE closed 10% higher at Rs 20.05 apiece, their highest level since February 5.
SBI and the seven other banks had invested in the Bank as part of the Yes Bank Reconstruction Scheme in March 2020.
"This transaction is the largest cross-border investment in the Indian banking sector. The transaction is subject to the necessary regulatory and statutory approvals including from the Reserve Bank of India and Competition Commission of India and will be subject to customary closing conditions," said Yes Bank in a stock exchange filing.
SMBC, a unit of Sumitomo Mitsui Financial Group, is Japan's second-biggest bank.
The transaction is a significant milestone to drive Yes Bank’s next phase of growth, profitability and value creation and we expect to leverage SMBC’s global expertise in this phase, said the Mumbai-headquartered private lender.
Prashant Kumar, Managing Director & Chief Executive Officer, Yes Bank said: “We are excited to welcome SMBC, a globally renowned financial partner, as a major shareholder whose investment marks a pivotal step in our next phase of growth. We expect to benefit from their global expertise and high governance standards. This investment is a powerful endorsement of our transformation journey and future potential. Over the past few years, our growth has been shaped by the strong partnership and unwavering support of SBI and they will continue to remain a valued stakeholder.”
Toru Nakashima, President & Group CEO, SMFG and Akihiro Fukutome, President & Chief Executive Officer, SMBC said: “India represents a key market for us, and we see immense long-term potential in its dynamic and fast-growing economy. We are proud to invest in Yes Bank, a leading Indian bank with visionary leadership and a demonstrated track record of improving profitability. This investment aligns with our commitment to building lasting, value driven relationships in the region. We look forward to working closely with the team as a major shareholder in their next phase of growth.”
Private equity majors Advent International and Carlyle have a 9.2% and 6.84% holding, respectively.
Life Insurance Corporation of India holds a 3.98% stake in Yes Bank.
Restrictions on ownership, stricter capital requirements, and state domination of the banking sector have curbed foreign banks' operations in India. A takeover of troubled Lakshmi Vilas Bank by Singapore-based DBS Group in 2020 was the last major deal in the sector.
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