• SMBC is in advanced talks to acquire a 51% stake in Yes Bank, potentially the largest banking deal in India.
• The acquisition could trigger an open offer for an additional 26% stake.
• The Reserve Bank of India has given verbal approval for the deal structure.
• Yes Bank has improved significantly since its 2020 restructuring, reporting strong financial results.
• State Bank of India currently holds a 24% stake and is involved in the negotiations.

Japanese banking giant Sumitomo Mitsui Banking Corp (SMBC) is in advanced discussions to acquire a significant stake in India's Yes Bank, according to sources cited by Channel News Asia and Indiatimes. The deal is poised to become the largest in India's banking sector, triggering an open offer for an additional 26% stake in the private lender.

As of now, SMBC does not hold a stake in Yes Bank, which was restructured in March 2020 after experiencing severe financial issues. State Bank of India (SBI), currently owning a 24% stake, has been negotiating with SMBC for the sale and continues discussions regarding the deal structure, as reported by Indiatimes and Reuters.

The Reserve Bank of India (RBI) is reportedly supportive of the acquisition, having given SMBC verbal approval to finalize the deal terms, as cited by Reuters. The bank's recovery has seen significant improvement, with the financial performance consistently enhancing since its crisis, allowing Yes Bank to report a net profit for FY25.

If the acquisition proceeds as planned, it would facilitate SMBC's position as Yes Bank's largest shareholder and possibly reshape the competitive landscape in India's banking sector. The deal progresses amid broader efforts by SBI to divest its stake, while other key stakeholders assess their positions, according to Indiatimes and Channel News Asia.