No SBI share in Yes Bank to be sold for next 3 years, confirms SBI Chairman Rajnish Kumar

State Bank of India Chairman Rajnish Kumar on Tuesday confirmed that the state-run bank will not sell any of its shares in the crisis-hit Yes Bank in the next three years. The SBI has been allotted 605 crore shares in Yes Bank for an investment of Rs 6,050 crore and would be the largest shareholder in the restructured bank with a stake of 49 per cent.

Its statement gains significance as the reconstruction plan for Yes Bank said that the largest public sector bank will have to hold at least 26 per cent stake for the next three years. Concerns of a possible profiteering by the investing banks have arisen as the prevailing share price of Yes Bank is nearly six times the price at which the domestic banks have subscribed to its shares. Yes Bank shares closed at Rs 58.65 a piece on BSE on Tuesday.

Rajnish Kumar on Tuesday said that although he cannot talk about other banks, regarding SBI, "not even a single share will be sold in three years".

Other private sector banks who have put in a total of Rs 3,950 crore so far, would have to hold at least 75 per cent of their investment for a three year period under the terms of restructuring scheme.

Even if such entities want to sell the 25 per cent of their investment now, which they are free to execute under the scheme, they would end up not only recovering their entire investment but also making windfall gains.

Among the private players, ICICI Bank and Housing Development Finance Corporation committed Rs 1,000 crore each. Axis Bank and Kotak Mahindra Bank committed to invest Rs 600 crore and Rs 500 crore, respectively. Both Federal Bank and Bandhan Bank have been allotted shares for Rs 300 crore each as per their commitment and IDFC First Bank has been issued equity shares in the crisis-ridden bank for a consideration of Rs 250 crore.