Deutsche Bank entities cut Yes Bank stake by 2.62% via encumbrance release

Deutsche Bank AG, through its associated entities, has disclosed a significant reduction in its aggregate holding in YES Bank Limited. This change follows the release of 820 million (82 crore) equity shares from an encumbrance, effective June 3, 2025. The transaction has decreased the combined stake of Deutsche Bank entities in YES Bank by 2.62%, bringing their total holding down to 13.46% of the private lender's total share capital. The formal disclosure was submitted to the stock exchanges on June 5, 2025, in compliance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. Note: Percentages are calculated based on YES Bank's total share capital of 31,35,41,15,322 equity shares of INR 2 each, as per the latest public disclosures for the quarter ended March 31, 2025. The "Holding Prior to June 3, 2025 Release" reflects adjustments from May 2024 events.

Disclosure Details and Regulatory Compliance

The disclosure, dated June 5, 2025, was made by Deutsche Bank AG, Hong Kong Branch, and signed by Mr. Ramanathapura, Prasanna Venkatesha Murthy Manu, Vice President. It falls under Regulation 29(2) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, often referred to as the Takeover Code. This regulation mandates disclosures when there are changes in shareholding or voting rights beyond certain thresholds, including changes related to encumbered shares. The entities involved as acquirers and Persons Acting in Concert (PAC) with the acquirer include DB Trustees (Hong Kong) Limited (“DB Trustee”) and Deutsche Bank AG, Singapore Branch (“DBSG”). These entities act in their capacity as offshore security agents for certain lenders. Other PACs mentioned are DWS Investment GmbH, DWS International GmbH, and DBX Advisors LLC. The target company is YES Bank Limited.

Details of the Transaction: Release of Encumbrance

The core event prompting this disclosure was the release of a substantial block of YES Bank shares from an indirect encumbrance. Specifically, on June 3, 2025, an aggregate of 820,000,000 (82 crore) equity shares of YES Bank were released from an encumbrance that had been created in favour of Deutsche Bank AG, Singapore Branch (DBSG), acting as a security agent. These 820 million shares represent 2.62% of YES Bank's total paid-up share capital and also 2.62% of its total diluted share/voting capital. According to the Takeover Code (Regulation 29(2) read with Regulation 29(4)), the release of an encumbrance over shares is treated as a disposal. The disclosure was necessitated because this release resulted in a change greater than 2% in the shareholding of YES Bank over which DB Trustee and DBSG collectively have an encumbrance.

Impact on Deutsche Bank Entities' Shareholding in YES Bank

Prior to this specific release on June 3, 2025, but accounting for certain transactions in May 2024 (detailed below), the aggregate holding of Deutsche Bank AG and its associated entities in YES Bank stood at 5,041,090,968 shares. This constituted 16.08% of YES Bank's total share/voting capital. This holding comprised 5,028,098,484 shares (16.04%) held by way of encumbrance through DB Trustee and DBSG, and an additional 12,992,484 shares (approximately 0.04%) carrying voting rights held directly by other Deutsche Bank Group entities. Following the release of the 820,000,000 shares, Deutsche Bank AG's aggregate holding in YES Bank has decreased to 4,221,090,968 shares. This revised holding represents 13.46% of YES Bank's total share/voting capital. The composition of this new holding is 4,208,098,484 shares (13.42%) held by way of encumbrance (5,028,098,484 minus 820,000,000), while the 12,992,484 shares held by other Deutsche Bank entities remain unchanged. The total equity share capital of YES Bank Limited, as per the disclosure and based on filings for the quarter ended March 31, 2025, is 31,35,41,15,322 fully paid-up equity shares with a face value of INR 2 each. This figure remained constant before and after this specific transaction, as the event was a release of existing encumbered shares, not an issue or buyback of shares.

Background and Previous Adjustments to Holding

Deutsche Bank AG had previously made a disclosure under the Takeover Code on April 23, 2024. Since that date, there have been other notable changes to the encumbered holdings which were factored into the "pre-release" figures mentioned above:

• On May 3, 2024, a significant parcel of 594,000,000 (59.4 crore) shares of YES Bank, which were encumbered in favour of DBSG, were released from that encumbrance.
• On May 5, 2024, a large number of warrants of YES Bank, specifically 1,279,880,909 warrants that were encumbered with DB Trustee, were converted into equity shares.

These events in May 2024 had already altered the landscape of Deutsche Bank entities' interest in YES Bank shares prior to the most recent release on June 3, 2025.

Other Disclosed Interests in YES Bank

The disclosure document also sheds light on other interests. As of June 3, 2025, Nomura Singapore Limited, identified as one of the lenders for whom Deutsche Bank entities act as security agents, independently holds an interest in 6,786,000 equity shares of YES Bank. This holding, which aggregates to approximately 0.02% of YES Bank's shareholding, is held pursuant to certain futures contracts.

Market and Regulatory Context

Disclosures under SEBI's Takeover Regulations are crucial for maintaining transparency in the capital markets, especially concerning substantial shareholdings and changes thereof in listed companies. They provide investors and the market with timely information about significant shifts in ownership or control, including interests held through encumbrances like pledges or liens. The reduction in encumbered shares held by entities acting as security agents for lenders can have various interpretations, potentially signaling changes in the underlying financial arrangements for which these shares were pledged. The market will likely assimilate this information to gauge any broader implications for YES Bank. This disclosure ensures that all stakeholders are aware of the current extent of Deutsche Bank entities' exposure and interest in YES Bank.