SMBC to Invest Rs 16,000 Cr More in YES Bank; Stake May Rise to 25% as Stock Gains 2.46%

Sumitomo Mitsui Banking Corp (SMBC), a major Japanese financial institution, plans to inject Rs 16,000 crore ($1.83 billion) into YES Bank. This investment will be a combination of equity and debt, as reported by The Economic Times. The move is expected to bolster YES Bank's balance sheet and may signal a shift in ownership dynamics.

YES Bank's shareholders recently approved the fundraising initiative. Following this, the Reserve Bank of India (RBI) granted SMBC permission to increase its stake in the bank up to 24.99 per cent. Initially, SMBC will acquire a 20 percent stake from domestic banks.

Funding Structure and Capital Infusion

The proposed funding plan includes Rs 8,500 crore through yen-denominated bonds with an interest rate below 2 percent. Additionally, Rs 7,500 crore will be raised as equity, likely via foreign currency convertible bonds (FCCBs). This capital infusion aims to enhance YES Bank's capital adequacy and asset quality metrics.

The remaining 4.99 per cent stake acquisition is still under consideration. Options include negotiations with private equity investors Advent International and Carlyle Group or subscribing to new equity issued by the bank.

Impact on YES Bank's Financial Metrics

The fresh capital is anticipated to improve YES Bank's net interest margin (NIM), which was at 2.5 per cent in June 2025-one of the lowest in the sector. A healthier balance sheet could position the bank for more competitive lending opportunities in the future.

Advent International and Carlyle Group currently hold stakes in YES Bank through Verventa Holdings and CA Basque Investments, respectively, with shares of 9.2 per cent and 4.2 per cent.

SMBC's Strategic Moves in India

SMBC is also setting up a wholly owned subsidiary in India as part of its strategic expansion plans. This entity is expected to facilitate acquiring a majority stake in YES Bank, according to sources cited in the report.

This strategic move by SMBC not only strengthens its presence in India but also aligns with its global operations across 39 countries.

Yes Bank Share Price

NSE: YESBANK; On August 29, 2025, Yes Bank Ltd closed at Rs 19.14, marking a gain of Rs 0.46 or 2.46% for the day. The trading session ended at 3:30 PM IST, with the stock showing positive momentum.