Carlyle Group eyes 10% stake in Yes Bank via convertible debt route

Yes Bank

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26 Aug, 2025 12:21

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Washington-based private equity firm Carlyle Group is looking to acquire a 10 percent stake in Yes Bank via the convertible debt route, reported CNBC-TV18 citing sources.

The PE major is likely to consider the convertible debt route as the State Bank of India (SBI) is supposed to hold a 26 percent stake in YES bank till March 2023.

The Carlyle Group is planning to invest via the foreign direct investment (FDI) route instead of FPI, according to the channel. Notably, FEMA (Foreign Exchange Management Act) rules require a minimum of 10 percent stake buy to qualify as FDI.

The bank is expected to take up the matter for discussion when its new board meets in mid-July.

Moneycontrol could not independently confirm the news development.

As per norms, to hold over a 4.9 percent stake in a bank, the company in question must get the approval of the Reserve Bank of India (RBI). Further, RBI caps individual stake in any bank at 10 percent and at 15 percent for financial entities in banks.

Past reports had stated that Carlyle is mulling a Rs 3,750-4,500 crore ($500-600 million) investment in Yes Bank. The reports had surfaced at a time the private lender was in talks with private equity investors to raise Rs 7,500-11,250 crore ($1-1.5 billion) in expansion capital to bolster its balance sheet, two years after it was placed under SBI guardianship to stave off a possible run on its deposits.

Moneycontrol had reported in April that the Carlyle Group will sell its entire stake in SBI Cards & Payments Services Ltd for as much as Rs 2,558 crore via a block deal. CA Rover Holdings, a Carlyle entity, which, as of the December 2021 quarter, held 29.20 million shares or a 3.09 percent stake in SBI Cards, was looking to sell its entire stake in the firm through a block trade.