SBI sells 13.18% Yes Bank stake for ₹8,889 crore

What SBI and Yes Bank announced

State Bank of India (SBI) said it has completed the sale of its 13.18% stake in Yes Bank to Sumitomo Mitsui Banking Corporation (SMBC) of Japan. The deal size was ₹8,889 crore, executed at a price of ₹21.50 per share. SBI disclosed that the sale involved 4.13 billion shares, also reported as 413.44 crore equity shares. The divestment follows regulatory clearances from the Reserve Bank of India (RBI) and the Competition Commission of India (CCI). After the transaction, SBI’s holding in Yes Bank reduced to about 10.8%, also described in filings as “around 10%”.

Deal structure and why it matters

The SBI sale is part of a larger transaction in which SMBC agreed to invest ₹13,483 crore to acquire a 20% stake in Yes Bank. Over 13% came from SBI, while the balance 7% stake was sold by a consortium of Indian lenders. The sellers included Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank, and Kotak Mahindra Bank. The transaction has been described by the parties as the single-largest cross-border investment in an Indian private sector bank. For Yes Bank, the entry of a large foreign strategic shareholder changes its ownership profile, with SMBC becoming the largest shareholder, a position earlier held by SBI.

Key approvals and internal clearances

SBI said the transaction followed RBI clearance dated August 22, 2025 and CCI clearance dated September 2, 2025. The bank also stated that its Executive Committee of the Central Board (ECCB) had approved the divestment at a meeting held on May 9, 2025. Separately, SMBC has RBI approval to increase its stake in Yes Bank up to 24.99% in the future. This regulatory headroom is central to how the market is reading SMBC’s longer-term intent, even though the current reported levels vary across different disclosures.

SMBC’s subsequent stake increase via off-market sale

SMBC later announced that it acquired an additional 4.22% stake in Yes Bank through an off-market sale dated September 22, 2025. Following this purchase, SMBC said its holding rose to 24.22% from 20%, as per Yes Bank’s exchange filing. The move was described as being in line with the Japanese lender’s RBI approval granted in August, which allowed it to acquire up to 24.99% in Yes Bank. The filings also called SMBC’s earlier entry the largest cross-border investment in an Indian private sector bank.

Board changes at Yes Bank

As part of the strategic investment, two SMBC representatives joined Yes Bank’s board. The individuals named were Rajeev Veeravalli Kannan and Shinichiro Nishino. Their appointment follows the completion of the stake acquisition and signals SMBC’s role in governance as a major shareholder. Yes Bank’s disclosures positioned this as a milestone linked directly to the transaction’s closure.

How SBI’s Yes Bank holding has evolved since 2020

SBI became the largest shareholder of Yes Bank in March 2020 under a Government of India-backed reconstruction scheme for the then crisis-hit private lender. TradeBrains figures cited in the report said SBI initially acquired a 48.2% stake in March 2020, which was later diluted to 30% after an FPO. Another reported data point said SBI picked up a 49% stake for ₹7,250 crore in March 2020 as part of the RBI’s restructuring plan. The current sale trims SBI from about 24% to roughly 10.8%, after selling more than half of its holding.

What the selling banks paid and what they sold now

The lenders that supported the 2020 reconstruction had subscribed at around ₹10 per share, according to the report. The 2025 sale to SMBC was executed at ₹21.50 per share, as per SBI’s filing. Alongside SBI’s 13.18% sale, the remaining portion of SMBC’s 20% acquisition came from the seven-bank consortium. One report also stated that the seven banks would divest a combined stake for ₹4,594 crore as part of the broader arrangement.

Market reaction and near-term financial implications

After the announcement, SBI shares were reported up nearly 3% on the BSE, quoted around ₹856.5 at 2:55 pm, with another report noting a 3.02% rise to ₹856.95. Yes Bank shares were marginally higher at ₹21.02, up 0.1% at the same time. One report noted that the proceeds from the partial stake sale are expected to boost SBI’s bottom line in the second quarter ending September, at a time when interest income and margins were under pressure amid policy rate cuts and subdued credit offtake. Analysts cited in the report said the money could support treasury-related income, which forms part of other income.

Summary table of the transaction

Why this transaction is being watched

The deal is significant because it formalises a foreign strategic shareholder’s presence in Yes Bank after the 2020 rescue led by domestic institutions. It also repositions SBI from being the dominant shareholder to remaining a sizeable but minority investor. In SBI’s own statement, its chairman C S Setty described the 2020 restructuring as an innovative public sector and private sector partnership and welcomed SMBC as a strategic partner. For the market, the combination of a stated acquisition price, completed regulatory approvals, and board representation makes this more than a passive financial investment.

Conclusion

SBI’s completed ₹8,889 crore stake sale to SMBC closes a major leg of SMBC’s ₹13,483 crore plan to buy 20% of Yes Bank. With SBI now at about 10.8% and SMBC’s RBI approval extending up to 24.99%, future changes in shareholding will be tracked through subsequent exchange filings and regulatory disclosures.