Yes Bank board approves raising ₹16,000 crore via mix of equity, debt
Yes Bank on Tuesday (June 3, 2025) said its board has approved raising of ₹16,000 crore through a mix of equity and debt to fund business growth.
The board approved raising of funds by way of issuance of eligible equity securities through various permissible means, provided that the aggregate amount to be raised by issuance of such securities would not exceed ₹7,500 crore and would not result in an aggregate dilution of more than 10% (including dilution on account of issuance of equity securities in terms of this item and conversion of any convertible debt securities approved by the board), the private bank said in a regulatory filing.
The board also gave its nod to raising funds by way of issuance of eligible debt securities in Indian or foreign currency, provided that the aggregate amount to be raised by issuance of such securities would not exceed ₹8,500 crore and would not result in an aggregate dilution of more than 10%, it said.
According to the filing, the board also approved amendments to the Articles of Association of the bank pursuant to the terms of the share purchase agreement dated May 9 executed by and amongst the bank, Sumitomo Mitsui Banking Corporation (SMBC) and State Bank of India (SBI), which would be subject to approval of the Reserve Bank of India and shareholders of the bank.
The rights of SMBC and SBI that are proposed to be incorporated into the Articles of Association of the bank are subject to the fall-away thresholds of 10% and 5%, respectively.
According to the revised Articles of Association, SMBC or any of its permitted assignees would have the right to nominate two non-executive and non-independent directors for appointment to the company board, subject to applicable laws.
SBI will have the right to nominate one non-executive and non-independent director for appointment to the board, the filing said.
Last month, SBI and seven other lenders announced that they will sell 20% of their combined stake in Yes Bank to Japan's SMBC for a consideration of ₹13,483 crore, making it the largest cross-border investment in the Indian banking sector.
Following the completion of the transaction, SMBC will become the single-largest shareholder of Mumbai-based Yes Bank.
Of the 20% stake, SBI will dilute a 13.19%t stake in Yes Bank in favour of SMBC for a consideration of ₹8,889 crore, while 6.81% shareholding will be offloaded by seven other lenders — Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank and Kotak Mahindra Bank — for about ₹4,594 crore.
SBI and the seven other lenders invested in the bank as part of the Yes Bank Reconstruction Scheme in March 2020. Mumbai-headquartered SBI, which owned a 24% stake in Yes Bank, will be left with a little over 10% stake after the dilution.
SMBC is a wholly-owned subsidiary of Sumitomo Mitsui Financial Group, Inc — the second largest banking group in Japan with total assets of $2 trillion as of December 2024 and a strong global presence.
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