Yes Bank seeks new promoter, eyes $8-9 billion valuation: Report

Yes Bank, India's sixth-largest private sector lender by assets, is looking for a new promoter. Livemint reports that the bank is planning to sell up to 51% of its stake for a target valuation of between $8-9 billion, which is a significant increase from its current market capitalisation of $7.2 billion. Citigroup's India unit has been enlisted to facilitate the search for a potential buyer.

Yes Bank has sent invitations to various Indian lenders, including current shareholders, to participate in this endeavour. The bank has initiated discussions with banks and financial institutions in Japan, West Asia, and Europe for the sale of at least 51% stake in Yes Bank. However, any new promoter holding more than 26% stake will need special approval from the Reserve Bank of India (RBI) as per central bank regulations.

The potential stake sale stands to provide an exit for major shareholders such as State Bank of India (SBI), Life Insurance Corp. Of India (LIC), HDFC Bank Ltd, and ICICI Bank Ltd, which had intervened to rescue Yes Bank in 2020 when it was facing collapse under its previous management.

Since SBI is the largest shareholder with a 29 percent stake, it has assured the appointed investment banker that the incoming promoter will obtain up to 51 percent ownership to ensure clarity in day-to-day management processes.