NEW DELHI: State Bank of India on Saturday confirmed that it will pick up a 49 per cent stake in Yes Bank for Rs 2,450 crore. If necessary, the country’s largest lender’s investment can go further up to Rs 10,000 crore, SBI Chairman Rajnish Kumar said. SBI will respond to the RBI’s offer to reconstruct Yes Bank following due diligence by its legal and investment teams on Monday.
"We will try to get the resolution plan approved and implemented much before the set deadline of April 3," Kumar said. Speaking to media, he said as many as 23 potential investors were interested in investing in Yes Bank and the SBI board will decide if it should invest alone or consider co-investing.
"We have to hold 26% for three years. But depending on the scenario, if I find co-investors, who are acceptable to RBI, we might consider that," he explained. Foreign and domestic investors picking up over 5% stake in a bank will have to comply with RBI’s fit and proper criteria.
Stating that Yes Bank’s revised market capitalisation of Rs 2,500 crore doesn’t look overpriced, he said SBI’s proposed investment of Rs 2,450 crore, prima- facie, was a reasonable bet even for SBI’s shareholders including minority investors.
According to him, SBI never lost money so far. Be it in SBI Cards or SBI Mutual Funds, the bank ensured its joint venture partners and subsidiaries don’t get disappointed. As for Yes Bank's 'forced investment call'. Kumar said, "There were not many options before RBI and government, which is why they had to go with this proposal."
He assured depositors that despite inconvenience, their money was safe. But maintained that SBI won’t merge Yes Bank with itself. However, it will nominate MD & CEO and two nominee directors, who will steer the company when the RBI-appointed administrator vacates office next month.
Given SBI’s size and rate of internal accruals, he believes the proposed investment will neither dent the bank’s capital ratios nor will it knock on the government’s doors for capital. "Our board mandate is that we maintain 0.5% above regulatory minimum capital adequacy. We will continue to do that," Kumar said.
ED grills Rana Kapoor for second day
The Enforcement Directorate on Saturday continued questioning Yes Bank founder Rana Kapoor in connection with a money laundering probe launched against him and others