Private sector lender Yes Bank announced that its board has approved raising of Rs 16,000 crore through a mix of equity and debt in order to fund business growth. The Bank has approved raising up to Rs 7,500 crore in equity capital and Rs 8,500 crore through debt instruments during FY26. The funds will be raised in several phases, across both domestic and international markets.
In a regulatory filing, the company said that it has received board approval to raise up to Rs 7,500 crore by issuing equity securities through various permitted methods. However, the total equity dilution including from converting any approved convertible debt, will not exceed 10 per cent.
Further, the board has also approved raising up to Rs 8,500 crore by issuing eligible debt securities in Indian or foreign currency. This, it added, will be done in one or more phases, in domestic and/or overseas markets. The total equity dilution, including from any conversion of these debt securities or other approved equity issuances, will not exceed 10 per cent.
According to the filing, the board also approved changes to the bank’s Articles of Association in line with the share purchase agreement signed on May 9 between the bank, Sumitomo Mitsui Banking Corporation (SMBC), and State Bank of India (SBI). These changes will need approval from the Reserve Bank of India and the bank’s shareholders, it said.
The updated Articles of Association state that:
– SMBC (or its permitted assignees) can nominate two non-executive, non-independent directors to the bank’s board, as long as they follow applicable laws.
– SBI can nominate one non-executive, non-independent director.
However, Yes Bank said that these rights will no longer apply if SMBC’s and SBI’s shareholding falls below 10 per cent and 5 per cent, respectively.
Earlier last month, SBI and seven other lenders announced that they will sell 20 per cent of their combined stake in Yes Bank to Japan’s SMBC for a consideration of Rs 13,483 crore.