Government Asks SBI To Form Consortium To Buy Stake In Yes Bank: Report
The government has approved a plan for the nation's biggest lender, State Bank of India, to lead a consortium that will buy a stake in troubled Yes Bank Ltd., according to people with knowledge of the matter. (Also Read: Yes Bank Shares Surge 29% In Biggest Single-Day Gain In 4 Months)
The announcement is expected soon, the people said, asking not to be identified as the information isn't public. State Bank of India has been authorized to pick other members of the consortium, the people said.
A Finance Ministry spokesman wasn't immediately available for comment. Representatives for Yes Bank and State Bank didn't immediately reply to emails seeking comment.
Yes Bank, which has postponed its December quarter results citing fund raising talks, is set to announce earnings by March 14. It has been struggling to raise capital for the past few months and needs the money to bolster ratios that stand just above a regulatory minimum.
Yes Bank's shares jumped 12.8 per cent in Mumbai on Thursday, while State Bank of India dropped 5 per cent on the news. Authorities won't allow any major bank to fail, central bank Governor Shaktikanta Das told Bloomberg News in an interview this week.
Yes Bank recently said it has received non-binding offers from foreign investors including JC Flowers & Co., Tilden Capital, Oak Hill Advisors and Silver Point Capital. However, this is not the first time the bank has announced names of potential investors. In November, the bank's board had disclosed names of other investors though it has since then rejected most of those.
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