YES Bank share price jumped over 3 percent in intra-day deals on Tuesday, July 16 after Sumitomo Mitsui Financial Group (SMFG) is reportedly considering an additional investment of $1.1 billion in the private sector lender, according to media reports.
As part of this potential move, SMFG may also acquire approximately $680 million worth of convertible bonds. Additionally, the Japanese financial giant is said to be exploring the purchase of a 5 percent stake in Yes Bank from existing shareholders such as Carlyle and others. This development underscores SMFG’s growing interest in expanding its footprint in India’s banking sector through strategic investments in one of the country’s leading private lenders.
Bond ratings upgraded on improving fundamentals
Credit rating agency ICRA has upgraded Yes Bank’s Infrastructure Bonds and Basel III Tier II Bonds worth ₹24,460.80 crore to ‘ICRA AA- / Stable’. The upgrade reflects the bank’s growing scale of operations, healthier loan book with increased share of granular lending, and continued reduction in stressed assets, which together provide greater stability to its earnings and capital position.
ICRA also highlighted steady recoveries from security receipts, which supported profitability in recent quarters. While these recoveries may slow, they are still expected to aid near-term earnings. The agency noted that the bank is focused on enhancing its core operating profitability to maintain a sustainable growth profile. ICRA further acknowledged the proposed stake acquisition by Sumitomo Mitsui Banking Corporation as a positive trigger.
The bank’s capitalisation remains comfortable, supported by healthy deposit growth. However, ICRA flagged that the share of wholesale deposits is still high. Notably, the bank’s vulnerable book—including loans overdue by 31-90 days and restructured assets—has declined to 10 percent of its core capital as of March 2025, from 21.2 percent a year earlier.
Q1 update shows dip in loans, steady CASA performance
In its provisional update for Q1FY26, Yes Bank reported a quarter-on-quarter decline in both advances and deposits. Loans fell by 2 percent to ₹2.41 lakh crore, while deposits slipped 3 percent to ₹2.75 lakh crore. Despite the contraction, the CASA ratio stood at 32.7 percent in June 2025, up from 30.8 percent a year ago, although slightly lower than the 34.3 percent recorded in March 2025.
The bank’s efforts to improve asset quality, along with capital and liability management, continue to drive its operational recovery, though near-term growth momentum has moderated.
Stock Price Trend
The stock rose as much as 3.3 percent to hit an intraday high of ₹20.65. It currently trades 24 percent below its 52-week high of ₹27.20, recorded in July 2024. On the downside, the stock had touched a 52-week low of ₹16.02 in March 2025. Over the past year, the stock has declined by 22 percent. However, on a year-to-date basis in 2025, it has posted modest gains of 5 percent.
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