SBI Divests 13.18% Stake in Yes Bank to Sumitomo Mitsui Banking Corp for ₹8,889 Cr

The country's largest lender State Bank of India on Wednesday announced the completion of the divestment of about 13.18% stake in Yes Bank to Sumitomo Mitsui Banking Corporation of Japan for ₹8,888.97 crore.

State Bank of India (SBI) has received ₹8,888.97 crore from the acquirer Sumitomo Mitsui Banking Corporation (SMBC), a Japanese multinational financial services company belonging to the Sumitomo Mitsui Financial Group (SMFG), the bank said in a regulatory filing.

SMFG is among the leading foreign banks in India. It is the second-largest Banking Group in Japan, with total assets of about USD 2 trillion.

SBI became the largest shareholder of Yes Bank in March 2020 under its Reconstruction Scheme 2020, as notified by the central government, the PSU bank said in a statement.

Subsequently, SBI had also acquired additional shares as part of a follow-on public offer by Yes Bank in July 2020.

Post the aforesaid divestment, SBI will continue to remain a shareholder in Yes Bank with a holding of 10.8%, it said.

The partial stake sale by SBI and other shareholder banks in Yes Bank to SMBC represents the largest cross-border investment in the Indian banking sector, it added.

The transaction has received the necessary regulatory and statutory approvals, including from the Reserve Bank of India and the Competition Commission of India.

SBI Chairman CS Setty said, "Yes Bank restructuring plan by the RBI in 2020 was an innovative, first-of-its-kind public sector -- private sector partnership that was fully supported and facilitated by the Government of India. We are incredibly proud of the journey we have shared with Yes Bank in supporting their transformation since we came on board as the major shareholder in 2020".

This is perhaps the best example of protecting the customer interests of a large bank by collaborative efforts of SBI and other banks under the guidance of the government and RBI, he noted.

"We are excited to welcome SMBC, a marquee financial institution, as a strategic partner through the largest cross-border transaction in India's banking sector. Their global expertise will be a great complement to Yes Bank’s ongoing progress and future ambitions," he said.

SBI and the other selling shareholder banks were advised by SBI Capital Markets Limited as their financial advisor.