Japan's Sumitomo Mitsui Banking Corporation (SMBC) has completed the acquisition of a 20% stake in Yes Bank to become its largest shareholder, after buying shares from State Bank of India (SBI) and other lenders who had bailed out the private lender in March 2020.   

SMBC has agreed to buy an additional 4.22% stake in Yes Bank from an affiliate of Carlyle Group for around Rs 3,065 crore. This will soon take SMBC’s total purchase of 24.22% stake in Yes Bank to around Rs 16,548 crore.

Two nominee directors of SMBC, Shinichiro Nishino and Rajeev Veeravalli Kannan, have been appointed to Yes Bank’s board as non-executive and non-independent directors.

State-owned SBI, which sold 13.18% stake in Yes Bank to SMBC for Rs 8,888.97 crore, will continue to hold a significant stake of 10.8% in the private lender.

SMBC also completed its 6.81% stake buy in Yes Bank from the other lenders including Axis Bank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Bandhan Bank, Federal Bank and IDFC First Bank for a combined Rs 4,594 crore, or Rs 21.50 per share.

Bandhan Bank said in a separate regulatory filing that its 15.39 crore shares of Yes Bank was bought by SMBC at Rs 21.50 per share. With this sale, Bandhan Bank’s stake in Yes Bank fell to 0.21% from 0.70%.

On 9 May 2025, the Reserve Bank of India (RBI) had approved SMBC to pick up 20% in Yes Bank for Rs 13,483 crore. 

In late August, SMBC had received a nod from the RBI to acquire a further 4.99% but without the promoter tag. This would take SMBC’s stake in Yes Bank to 24.99%.

Earlier this month, SMBC sold its entire 1.65% stake in Kotak Mahindra Bank to "rebalance its strategic investment portfolio".

Challenges ahead

SMBC has the challenge of lifting Yes Bank to its earlier position of being the fourth-largest private lender before it collapsed in March 2020. Now the bank is seventh ranked, has got ride of its bad loans and has turned around but has to move up the ladder on retail and corporate loans.  

Yes Bank’s corporate book will stand to gain from SMBC’s stake buy as Japan has infrastructure and manufacturing investments in India. The Mumbai-based lender will get to leverage SMBC's global strengths, particularly in accelerating growth in its corporate banking, treasury services and cross-border solutions.