AGENCIES, New Delhi: Finance Minister Nirmala Sitharaman said on Friday that the Union Cabinet had approved a reconstruction scheme for Yes Bank as proposed by the Reserve Bank of India.
“State Bank of India will invest up to 49 per cent equity in Yes Bank and other investors are also being invited,” the Finance Minister told reporters after a meeting of the Union Cabinet. The Finance Minister’s comments come at a time the RBI has taken control of Yes Bank and capped withdrawals from its accounts at Rs 50,000 till April 3 in order to protect depositors.
The lender is also in talks with other prospective investors, the Finance Minister said. They would need to maintain at least 75 per cent of their investments for a minimum of three years, Sitharaman added.
As part of the RBI-backed rescue plan for the troubled private sector lender, SBI will acquire up to 49 per cent stake in Yes Bank, and will be required to maintain a minimum holding of 26 per cent in Yes Bank for three years.
All the existing Yes Bank’s employees will be retained as part of the deal.
In a separate development, ICICI Bank’s board approved investment of Rs 1,000 crore in Yes Bank through equity. ICICI Bank said it will buy 100 crore equity shares of Yes Bank at Rs 10 per share.