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Yes Bank Stake Sale: Sumitomo to buy 20% shareholding from SBI-led consortium of lendersAt the end of March quarter, SBI held a 24% stake in Yes Bank, followed by lenders including HDFC Bank(2.75%), ICICI Bank (2.39%), Kotak Mahindra Bank (1.21%), Axis Bank (1.01%) and LIC (3.98%).By Shloka Badkar    | Hormaz Fatakia   May 9, 2025, 4:39:53 PM IST (Updated)3 Min ReadSumitomo Mitsui Banking Corporation will be acquiring 20% stake in Mumbai-based private lender Yes Bank Ltd. from State Bank of India (SBI) and the consortium of lenders, who had rescued the bank back in 2020.

SMBC will be acquiring a 13.19% stake from SBI and a 6.81% stake from other lenders, including Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank and Kotak Mahindra Bank.

Federal Bank, in a separate exchange filing, has also announced that it will be selling 0.5% stake in Yes Bank, at ₹21.5 per share. The stake sale is valued at ₹357.5 crore. Since Federal Bank does not own more than 1% equity in the lender, it is not named in the shareholding pattern.

Similar to Federal, IDFC First Bank and Bandhan Bank also have a stake less than 1% in Yes Bank, and hence, do not feature in the March quarter shareholding.

As per this agreement, Sumitomo also has the right to nominate two non-executive and non-independent directors on the board of the bank and also has pre-emptive rights to subscribe to new issuance of share capital of the bank to maintain its pro-rata shareholding.

At the end of the transaction, SBI will still have a 10.78% stake in Yes Bank, and will continue to have a right to nominate one non-executive and non-independent director on the bank's board. This will be subject to SBI's stake remaining above 5% in the bank.

At the end of March quarter, SBI held a 24% stake in Yes Bank, followed by lenders including HDFC Bank(2.75%), ICICI Bank (2.39%), Kotak Mahindra Bank (1.21%), Axis Bank (1.01%) and LIC (3.98%).

The transaction, said to be the largest cross-border investment in the Indian banking sector, is subject to the necessary regulatory and statutory approvals, including the Reserve Bank of India and Competition Commission of India (CCI), and will be subject to customary closing conditions.

After the RBI suspended Yes Bank's board, a consortium of banks, led by SBI, rescued the lender with an investment of ₹7,250 crore for 49% stake in 2020.

SBI was issued shares back in 2020 at ₹10 per share.

"SBI's stake sale should result in a gain of ₹4,760 crore, which is 7.5% of their financial year 2026 profit and release 13 basis points of their CET1. It will still leave SBI with a balance 10.9% stake in Yes Bank," analysts from IIFL said.

Earlier this week, reports had stated that Sumitomo had received approval from the Reserve Bank of India to acquire 51% stake in Yes Bank, paving the way for an exit for SBI. Reports had suggested that the deal could value Yes Bank at $1.7 billion, under which SMBC would either buy less than 26% stake and do a merger via a share swap , or may be up to 26% stake and trigger an open offer.

In response, Yes Bank had issued a clarification regarding Japan's Sumitomo Mitsui Banking Corp (SMBC) being in talks with SBI for stake acquisition in the former, saying the bank is on a growth trajectory and routinely explores opportunities with various stakeholders, but such discussions are preliminary and do not warrant a disclosure.

Back then, Yes Bank had fallen short of liquidity requirements and its founder and CEO Rana Kapoor failed the get the RBI's approval to continue at the helm. Yes Bank does not have a promoter ever since Kapoor's exit in 2019.

Shares of Yes Bank ended 10% higher on Friday at ₹20.05.Continue ReadingFirst Published: May 9, 2025 3:53 PM ISTCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsSBIshare market todayYES Bank