SMBC Becomes Biggest Shareholder in Yes Bank with 24.22% Holding

New Delhi, September 23 – Japan’s Sumitomo Mitsui Banking Corp (SMBC) has become the biggest shareholder in Yes Bank after it boosted its holding to 24.22 per cent by way of an off-market deal, the private sector lender said on Tuesday.

Stake Acquisition Details

According to Yes Bank’s regulatory filing, SMBC acquired 132.39 crore additional shares on September 22, increasing its holding from 20 per cent to 24.22 per cent, or 759.51 crore shares in total.

The acquisition came after State Bank of India (SBI) offloaded a 13.18 per cent stake to SMBC for ₹8,888.97 crore. With this sale, SBI’s holding has now fallen from 24 per cent to just over 10 per cent.

Strategic Importance

Yes Bank said that SMBC’s increased holding will enable the lender to leverage the Japanese bank’s international network and experience, specifically in:

• Corporate banking
• Treasury operations
• Cross-border trade and investment flows between India and Japan

This strategic alliance is likely to reinforce Yes Bank’s position in global business banking and broaden its growth prospects.

Credit Rating Improvements

In another encouraging development, the four local rating agencies — CRISIL, ICRA, India Ratings, and CARE — have upgraded Yes Bank’s credit rating to AA-, the highest since March 2020.

The upgrades are based on:

• A capital base that is stronger
• Enhanced governance structure
• Operational performance in the recent quarters

Ownership History and Turnaround

Yes Bank’s shareholder rejig is another episode in its turnaround saga. In March 2020, the bank had a major liquidity crisis and was bailed out under a reconstruction scheme led by SBI and a group of lenders. They took a 79 per cent stake in the bank then to shore up operations.

Since then, bad loans at Yes Bank have come down, profitability has improved, and investor sentiment has been restored. The phased withdrawal of SBI and the ascendance of SMBC reflect the transition from domestic rescue-led ownership to strategic overseas investment.

Market Outlook

SMBC’s larger stake is a vote of confidence in Yes Bank’s recovery. With SBI’s reduced holding, the lender is now less dependent on domestic state-led support and more aligned with international best practices.

Experts suggest that Yes Bank may focus on:

• Scaling up corporate and trade finance businesses
• Leveraging SMBC’s Japanese and Asia-Pacific client base
• Expanding digital and treasury operations

The bank’s enhanced credit profile and better strategic support can also reduce its cost of funds and enhance lending competitiveness.

Latest Developments

Yes Bank stocks responded positively to early trade after the announcement, with investor sentiment being supported by SMBC’s commitment. The bank remains committed to de-stressing assets and increasing retail lending, while gearing up for more robust balance sheet growth in FY26. Experts are keenly observing if SMBC will ultimately pursue an increase in stake further, perhaps cementing a controlling stake for the long term.

Disclaimer:  At HDFC SKY, we take utmost care and due diligence in curating and presenting news and market-related content. However, inadvertent errors or omissions may occasionally occur.

If you have any concerns, questions, or wish to point out any discrepancies in our content, please feel free to write to us at content@hdfcsec.com.

Please note that the information shared is intended solely for informational purposes and does not make any investment recommendations