Shares of Yes Bank soared nearly 9% on Monday following the announcement that Japan’s Sumitomo Mitsui Banking Corporation (SMBC) will acquire a 20% stake in the Indian private lender for ₹13,483 crore ($1.58 billion). This transaction marks the largest cross-border investment in India’s banking sector to date (source).
SMBC plans to purchase:
- 13.19% stake from State Bank of India (SBI), Yes Bank’s largest current shareholder.
- 6.81% from seven private banks, including HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, IDFC First Bank, Federal Bank, and Bandhan Bank.
The acquisition is priced at ₹21.5 per share, valuing Yes Bank at around ₹67,411 crore. Once completed, SMBC will become Yes Bank’s largest shareholder and gain the right to appoint two directors to its board. Regulatory approvals from RBI, CCI, and shareholders are pending.
Market Reaction
Following the announcement, Yes Bank’s share price jumped to ₹21.74 on the BSE, showing investor confidence in the bank’s new strategic alignment. Analysts noted this move as a positive signal for Yes Bank’s future (Economic Times report).
Strategic Implications
This deal is considered a strong endorsement of Yes Bank’s recovery strategy post its 2020 bailout. It also signals a growing appetite among Japanese banks to expand in emerging markets like India.
Yes Bank CEO Prashant Kumar called the agreement a “pivotal moment” for growth, leveraging SMBC’s global experience and capital strength.
This partnership opens new possibilities for innovation, financial inclusion, and service excellence,” Kumar said in an official statement (SMBC Newsroom).
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