Yes Bank has received its board’s approval to raise ₹16,000 crore through a combination of equity and debt as it looks to fund business expansion in the coming financial year. The bank plans to raise ₹7,500 crore through equity issuance and another ₹8,500 crore through debt instruments in multiple tranches across both Indian and international markets.
Equity and Debt Capital Plans in Phases
As per its regulatory filing, Yes Bank will issue equity securities worth up to ₹7,500 crore through various permitted routes. The total equity dilution, including any resulting from the conversion of approved convertible instruments, will not cross 10 percent. In addition, the bank plans to raise ₹8,500 crore via eligible debt securities — denominated in either Indian or foreign currency — in one or more tranches depending on market conditions.
Yes Bank confirmed that the fund infusion will be executed both in domestic and overseas markets. The move is seen as part of a broader strategy to strengthen the bank’s capital base and fuel lending growth.
Changes to Articles of Association Post SMBC-SBI Deal
Alongside the capital raising plans, the board also approved amendments to the bank’s Articles of Association. These changes follow a share purchase agreement signed on May 9 between Yes Bank, Sumitomo Mitsui Banking Corporation (SMBC), and the State Bank of India (SBI). As per the new terms, SMBC — or its permitted assignees — will be allowed to nominate two non-executive, non-independent directors to Yes Bank’s board, while SBI can nominate one.
However, these rights will be contingent upon both SMBC and SBI retaining a minimum shareholding in the bank. If SMBC’s stake drops below 10 percent or SBI’s below 5 percent, their board nomination rights will cease.
Just last month, SBI and a consortium of seven other lenders had announced plans to sell a 20 percent stake in Yes Bank to Japan’s SMBC for ₹13,483 crore. This strategic partnership is expected to bolster investor confidence and bring international expertise to the Indian lender at a crucial juncture in its revival journey.
