SBI to buy 49pc stake in Yes Bank under rescue plan

New Delhi/Mumbai

State Bank of India, the country’s largest lender, will take a 49 per cent stake in Yes Bank, the Reserve Bank of India (RBI) said late yesterday as it laid out a plan for the rescue of the troubled private lender. India’s Finance Minister Nirmala Sitharaman at a briefing in New Delhi yesterday said the restructuring plan would be implemented within 30 days.

The RBI sharply increased Yes Bank’s authorised share capital, paving the way for the bad-debt laden lender to receive a cash injection after it failed in its months-long attempt to raise enough money to meet regulatory requirements. Based on details in the RBI’s statement, analysts calculated that SBI’s investment would need to total almost 25 billion rupees ($339.10 million).

The RBI and SBI have not given a figure. SBI said on Thursday its board had given it an in-principle nod to explore an investment in Yes Bank, an aboutturn after it had in December repeatedly denied it would play any role in aiding its competitor. SBI’s announcement came just hours after the RBI took control of Yes Bank, saying it would work swiftly on a revival plan for the lender.