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HomeSHARE MARKET₹24 Share: SBI Currently Holds The Highest Holding; This Company Now Has...

₹24 Share: SBI Currently Holds The Highest Holding; This Company Now Has Sufficient Capital

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Japanese companies Mitsubishi UFG Financial Group (MUFJ) and Sumitomo Mitsui Banking Corporation (SMBC) have desired to purchase a stack within Yes Bank.

According to the information obtained, they are looking to purchase a majority stake in Yes Bank. Additionally, several firms located in the Middle East are also showing a keen interest in investing in Yes Bank.

This happens at a moment when the group led by the State Bank of India (SBI) plans to sell its stake. This consortium has also saved Yes Bank from collapse about four years ago.

The Value Of The 51% Stake Held By Yes Bank At 35,578 Crore

According to reports, the matter is currently being considered, and no decision has yet been made. However, MUFG and SMBC want to expand their reach in a rapidly growing market such as India.

According to a source, discussions about the deal have begun. However, the agreement will also require RBI approval.

Yes Bank’s market value is currently Rs 69,762 crore. This is a majority stake, i.e., 51 percent, which is approximately 35,578 crore.

The biggest holding is SBI, which holds 26.13 percent of the total.

LIC, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Axis Bank, and IDFC First Bank have a 13.84 percent stake. However, the size of the part of Yes Bank that will be put on sale has not yet been established.

Yes Bank Has Been Rapidly Improving

Recently, the chief executive officer at Yes Bank said that the bank plans to promote lending to small and medium-sized businesses to improve the value of its assets. The bank’s primary goal is to enhance the profitability of its business without taking any action.

The first step is achieving a RoA (Return to Assets) of one percent within two years and a RoA of 1.5 percent. 1.5 percent over 3 to 5 years.

It was 0.2 percent in the quarter ending December 2023. The figure for HDFC Bank, the country’s largest bank, is 1.78 percent.

Recently, an analysis discovered that Yes Bank now has sufficient capital. Despite its systemic issues, the company’s deposits are growing, and its portfolio is improving.

The unique feature is that it sold the massive headache associated with NPA to the Asset Reconstruction Company.

Then, in December of 2022 Yes Bank announced to sell its NPAs valued at around Rs 48,000 crore in the form of JC Flowers Asset Reconstruction Company on March 31, 2022.

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