Yes Bank-SMBC Deal: RBI Approves Japan’s SMBC to Acquire Up to 24.99% Stake
Yes Bank Ltd. announced on August 23, 2025, that Japan’s Sumitomo Mitsui Banking Corporation (SMBC) has received the official approval from the Reserve Bank of India (RBI) to acquire up to 24.99% stake in the company.
Deal Background
In May 2025, the bank informed the stock exchanges that SMBC had inked a deal to take a 20% stake in Yes Bank, making it the largest cross-border merger and acquisition deal in India’s financial sector. Yes Bank clarified that SMBC will not be classified as a promoter despite the increased shareholding.
Share Purchase Agreement
On May 9, 2025, the private lender disclosed that it, along with its major shareholders, including SBI and other domestic banks, had signed a share purchase agreement with SMBC to facilitate the acquisition of the 20% stake.
Current Shareholding Pattern
As of June 2025, domestic lenders collectively held 33.7% of Yes Bank. SBI remained the largest single shareholder with a 23.96% stake, while foreign investors CA Basque Investments and Verventa Holdings held 4.22% and 9.2%, respectively.
SMBC’s Stake in Yes Bank
Currently, SMBC holds a 20% stake in Yes Bank, acquired in May 2025 through a secondary share purchase. This comprised a 13.19% stake from State Bank of India (SBI) and a combined 6.81% stake from seven other domestic banks: Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank, and Kotak Mahindra Bank.
RBI’s Approval and Conditions
RBI’s approval for the deal is subject to compliance with the Banking Regulation Act, 1949, RBI’s Master Directions on Acquisition and Holding of Shares or Voting Rights in Banking Companies, the Foreign Exchange Management Act, 1999, and other applicable laws.
Other Applicable Laws and Terms
Besides, other applicable laws and terms, including lock-in, any subsequent transactions being subject to conditions and the RBI’s decision, among others, have to be followed. The proposed transaction is subject to approval from the Competition Commission of India (CCI) and the customary conditions precedents as mentioned in the agreements referred to in our intimation dated May 9, 2025, it added.
Impact on Yes Bank’s Stock Price
On Friday, shares of Yes Bank settled 0.77% lower at Rs 19.28 apiece on the BSE. The private bank commands a market cap of Rs 60,480.45 crore. The stock has risen 8% in the last six months and nearly 2% on a year-to-date basis. In the last 12 months, it has declined 20%.
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Conclusion
The RBI’s approval for SMBC to acquire up to 24.99% stake in Yes Bank is a significant development in the Indian banking sector. The deal is subject to various conditions and approvals, and its impact on Yes Bank’s stock price will be closely watched by investors and market analysts.