SBI plans to sell stake worth Rs 2.2 billion in Yes Bank by end of March 2025: Report

Japanese lender Sumitomo Mitsui Banking Corp and Dubai-based Emirates NBD are in advanced negotiations to acquire a majority stake in Yes Bank, according to the report.

Sumitomo Mitsui is a unit of Japan's second-largest bank, Sumitomo Mitsui Financial Group.

"Both bidders are keen on acquiring a 51 percent majority stake in Yes Bank to gain significant control over its operations," the report quoted a source as saying. "The Reserve Bank of India (RBI) has verbally approved the proposal, and due diligence is underway."

Yes Bank was restructured by the RBI in March 2020 with the support of a consortium of local banks after it faced severe financial difficulties.

"Bidders are seeking relaxation on the regulatory requirement that promoter shareholding be brought down to 26 percent within 15 years of the investment, and talks are on," said one of the sources, referring to the stake by controlling shareholders.

Earlier reports in the media had indicated interest from Japanese and Middle Eastern lenders in acquiring SBI's stake in Yes Bank. One source mentioned that SBI has already received verbal approval from the RBI to sell its entire stake in Yes Bank and is expecting to earn a profit of around Rs100 billion from the transaction.

"SBI had rescued Yes Bank when there was a liquidity crunch, but now that things have turned around, it is prudent to exit," the same person told Reuters.

Once the RBI approves the bidders, the process should move quickly, allowing SBI to negotiate terms such as valuation with the bidders, according to two sources. At the current market price of Rs 24.60 per share, Yes Bank's valuation stands at Rs 77,095 crore.

However, talks could be delayed due to market volatility in Japan and a concurrent government stake sale in IDBI Bank, noted a fifth person familiar with the situation.

Emirates NBD, one of the potential bidders for Yes Bank, has also shown interest in acquiring private lender IDBI Bank and prefers to wait until that process is completed, the source added.