RBI Concerns Stall SBI's Majority Stake Sale In Yes Bank

State Bank of India's (SBI) plans to sell its stake in Yes Bank Ltd are facing potential delays due to concerns raised by the Reserve Bank of India (RBI) regarding the sale of a majority stake in the private bank. According to media reports, the banking regulator has yet to grant a definitive 'fit and proper' approval for the sale, raising uncertainties about the transaction.

Moreover, RBI is reportedly hesitant to allow a foreign buyer to take over 51 per cent  of Yes Bank’s stake, which has led to a stalemate in ongoing negotiations between the private bank and potential buyers. It is understood that bidders have been negotiating directly with the central bank, but there has been no progress towards resolution.

SBI currently holds a 23.99 per cent  stake in Yes Bank, which it acquired along with other lenders as part of a rescue plan implemented in March 2020. This initiative was aimed at stabilising the private bank’s finances, which had declined significantly.

However, despite its intention to offload its stake, SBI’s board has not yet taken up the stake sale proposal for formal discussion, as the timeline remains uncertain. A stake sale would offer an exit strategy for SBI and other lenders who invested in Yes Bank during the rescue effort.