Recently, a big news created a stir in the Indian banking sector. It is reported that Japan's Sumitomo Mitsui Banking Corporation (SMBC) has received approval from the Reserve Bank of India (RBI) to buy a 51% stake in Yes Bank. After this news, on Tuesday, May 6, 2025, Yes Bank shares saw a rise of about 10%. However, some sources have denied the news, causing confusion among investors. Let us understand this matter in detail.

The basis of the news and the reaction of the stock market

On Tuesday morning, a leading newspaper claimed that RBI has allowed SMBC to purchase a majority stake in Yes Bank. After this news, Yes Bank shares on the Bombay Stock Exchange (BSE) increased from the last closed price of Rs 17.73 to Rs 19.24, which shows a jump of more than 10%. This news was encouraging for investors, as Yes Bank has been facing financial challenges for the last few years. However, later some banking sources claimed that the RBI did not have any such formal application pending from the SMBC, after which the shares decreased slightly and they started trading at Rs 18.29.

Possible form of deal

According to reports, SMBC has two options. First, he can start the process of merger through share swap by purchasing less than 26% stake. Second, he can start an open offer by purchasing a direct 26% stake. However, SMBC's voting rights will be limited to 26% under RBI rules, even if they buy a 51% stake. The estimated value of this deal is being reported as $ 1.7 billion. The deal can provide a exhaust route for State Bank of India (SBI) and other banks, which became investors in 2020 during the reorganization of Yes Bank.

History and current status of Yes Bank

Yes Bank, which was once one of the major private banks of India, has faced a serious financial crisis in 2020. Its founder and then CEO Rana Kapoor did not get RBI approval, and the lack of liquidity of the bank brought it to the verge of sinking. At that time, a consortium led by SBI saved the bank by investing Rs 10,000 crore. Currently SBI has a 24% stake in Yes Bank, while HDFC Bank, ICICI Bank, Kotak Mahindra Bank, and others also have a small stake. This potential deal may indicate a new beginning for the bank.

What do experts say?

Financial experts believe that if this deal is completed, it will be an important step for Yes Bank. The presence of a strong foreign investor will increase the credibility of the bank and it will be able to face its competitors better. However, some experts are advising to take precautions, as the situation is not clear yet about RBI's approval. Investors are being advised to avoid taking a hurry on this news and wait for official confirmation.

Suggestions for investors

The recent boom in Yes Bank shares has caught the attention of small investors, but caution is necessary in view of market volatility. Experts suggest that the bank's financial status before investment, such as non-performing assets (NPAs), net interest margin (NIM), and analyzing quarterly results. Also, it would be prudent to wait for the official statement from the RBI and Yes Bank. If you are a long -term investor, this deal may be an opportunity for you, but do not ignore risks.