Yes Bank shares rise as Sumitomo Mitsui lines up Rs 16,000 cr fresh capital infusion

Shares of Yes Bank jumped 1% to their day’s high of Rs 18.92 on the BSE in early trade on Friday, August 29, following reports that Sumitomo Mitsui Banking Corp (SMBC), one of Japan’s largest financial institutions, is preparing an additional infusion of Rs 16,000 crore into the private lender, as per previous ET reports.

The funding is expected to be a combination of debt and equity, aimed at strengthening Yes Bank’s balance sheet ahead of a potential ownership role for SMBC.

This is in addition to the Rs 13,500 crore that SMBC has already committed to pay existing shareholders, including State Bank of India (SBI), to acquire a 20% stake in Yes Bank.

According to the earlier ET reports, the fresh capital will comprise Rs 8,500 crore in low-cost, long-term yen-denominated bonds priced under 2%, and Rs 7,500 crore in equity, likely structured as foreign currency convertible bonds (FCCBs).

Both Yes Bank and SMBC are currently in the process of seeking Reserve Bank of India (RBI) approval for the FCCB issuance.

The total proposed commitment of Rs 29,500 crore is part of a broader plan that could see SMBC raise its stake in Yes Bank up to 24.99%, subject to regulatory permissions. The Japanese bank has already secured RBI clearance to acquire the additional stake, but is yet to finalize how it will secure the remaining 4.99% over the 20% already committed.ET reports indicate that SMBC is evaluating multiple options, including subscribing to a fresh equity issue or negotiating with existing private equity investors like Advent and Carlyle, who currently hold stakes in the bank through investment arms Verventa Holdings (9.2%) and CA Basque Investments (4.2%), respectively.While SMBC’s acquisition plan has received regulatory approval for up to 24.99%, the company has not yet been granted promoter status, which remains under review, according to people cited in previous ET reports.

The proposed infusion is expected to improve Yes Bank’s net interest margin (NIM), which stood at 2.5% as of June 2025, among the lowest in the sector.

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