In a landmark FDI deal in Indian banking, the State Bank of India (SBI) announced it will sell a 13.19% stake in Yes Bank to Sumitomo Mitsui Banking Corporation (SMBC) of Japan for Rs 8,889 crore at Rs 21.50 per share. This move is part of a broader deal wherein SMBC will acquire a total 20% stake in Yes Bank, making it the largest cross-border banking investment in India to date.
Post-transaction, SBI's holding in Yes Bank will decline from 23.97% to 10.78%, signaling a strategic exit after rescuing the bank during its financial crisis in 2020. Alongside SBI, banks like HDFC Bank, ICICI Bank, Axis Bank, Kotak Mahindra, IDFC First, and Federal Bank will also exit partially, contributing to a total deal value of Rs 13,483 crore.
SMBC’s move strengthens Indo-Japan financial ties and signals foreign confidence in India’s private banking sector. The transaction will require approvals from the Reserve Bank of India (RBI), Competition Commission of India, and Yes Bank shareholders.
The deal is expected to bring global best practices, improved governance, and capital efficiency to Yes Bank. Analysts see this as a boost to the bank's long-term strategy, especially in SME lending, digital banking, and risk control.
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