SBI's Stake In Yes Bank Falls After FPO

On Monday, the State Bank of India (SBI) said that its holding in Yes Bank Ltd has declined to 30 percent after the follow on public offer (FPO).

Yes Bank's FPO was open from 15 to 17 July. After its reconstruction in March amid debt issues, the lender's new board had approved plan to raise funds up to Rs 15,000 crore, by way of issuance of securities.

To boost capital levels in line with regulatory norms, Yes Bank's board launched a Rs 15,000 crore FPO. Shares were offered at an attractive discount to attract more market investors and reduce the burden on the consortium of banks that are the stakeholders.

Prior to the FPO, SBI's holding in Yes Bank stood at 48.21 percent

Yes Bank's share capital doubled to 2,505.4 crore shares of face value Rs 2 per share after the FPO from 1,255 of the face value of Rs 2 each.

As a result, SBI now holds 751.6 crore shares or 30 percent of the total share capital.

Yes Bank's FPO received bids for 11.88 billion shares against issue size of 12.51 billion shares offered (that is 95 percent subscription), according to data on NSE. The issue was well received by institutional investors but lacked interest among HNIs and retail investors.

While the bank has managed to raise only Rs 14,267 crore out of its total target of Rs 15,000 crore, the shortfall was funded by SBI.

Shares of Yes Bank were down nearly 6 percent on Tuesday to Rs 11.10 in early trade while shares of SBI rose 1 percent to Rs 189.75.