SMBC To Buy a Majority Stake in India’s Yes Bank

Japanese banking giant Sumitomo Mitsui Banking Corporation (SMBC) is on the verge of acquiring a controlling stake in Yes Bank, India’s sixth-largest private lender by assets, in what could be the country’s largest banking sector merger and acquisition deal. According to sources, SMBC is in advanced talks to purchase a significant portion of Yes Bank, potentially triggering an open offer for an additional 26% stake. The deal could see SMBC becoming the single-largest shareholder, with a 51% stake valued at approximately $1.7 billion.

State Bank of India (SBI), which holds a 24% stake in Yes Bank, has been seeking a new owner following the lender’s turnaround from a central bank-led rescue in 2020. Other shareholders, including HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, and Life Insurance Corporation of India, collectively own 11.34%. Private equity funds Advent International and Carlyle hold 9.20% and 6.84%, respectively. It remains unclear which institutions will exit as part of the deal.

SMBC’s interest follows its $2 billion acquisition of a 74.9% stake in Fullerton India Credit in 2021, marking its growing ambitions in India. The Japanese bank, which established its India presence in 2012, has branches in New Delhi, Mumbai, Chennai, and Gujarat’s GIFT City. Senior SMBC leaders recently met SBI and other shareholders in Mumbai to finalise terms.

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Yes Bank has shown recovery, reporting a 93% increase in net profit to Rs 2,406 crore in FY25, with deposits rising to Rs 2.85 lakh crore. However, its stock performance remains lacklustre, closing at Rs 17.73, down 9.5% year-to-date. The Reserve Bank of India’s relaxed ownership guidelines may facilitate the deal, allowing SMBC to secure a controlling stake.