State Bank of India (SBI), the country’s largest lender, on Wednesday announced that it has completed the sale of around 13.18 per cent stake in Yes Bank Limited (YBL) to Sumitomo Mitsui Banking Corporation (SMBC). SMBC, part of the Sumitomo Mitsui Financial Group (SMFG), is one of Japan’s biggest financial institutions and a leading foreign bank operating in India.
SMFG is the second-largest banking group in Japan with assets worth nearly $2 trillion. SBI had become the largest shareholder in Yes Bank in March 2020 when the Central Government announced the Yes Bank Limited Reconstruction Scheme
The bank later picked up additional shares through the lender’s follow-on public offer in July 2020. After the latest stake sale, SBI continues to remain a shareholder in Yes Bank with an approximate 10.8 per cent residual holding. The divestment, along with stake sales by other shareholder banks, marks the largest cross-border investment in the Indian banking sector.
The deal received all necessary approvals, including those from the Reserve Bank of India and the Competition Commission of India. SBI Chairman Challa Sreenivasulu Setty said the restructuring plan for Yes Bank in 2020 was a unique example of a public-private sector partnership supported by the Government of India and the RBI. He said the collaborative effort helped protect the interests of millions of Yes Bank customers. “Yes Bank restructuring plan by RBI in 2020 was an innovative, first of its kind public sector – private sector partnership that was fully supported and facilitated by Government,” he added. “We are incredibly proud of the journey we have shared with Yes Bank in supporting their transformation since we came onboard as the major shareholder in 2020,” he stated.
Setty also welcomed SMBC as a strategic partner, describing the deal as the largest cross-border transaction in Indian banking. He added that SMBC’s global expertise will complement Yes Bank’s ongoing transformation and future growth. SBI Capital Markets Limited acted as the financial advisor for the transaction, while S&R Associates served as the legal advisor.
