HSBC's investment division HSBC Financial Services Middle East has bought a 4.99% stake in Yes Bank, revealed media reports.
HSBC Financial Services Middle East has been investing in Yes Bank since January 2008, according to media reports. It has also been reported that Rabo Bank has an 18% stake in Yes Bank.
HSBC also holds a 4.96% stake in Axis Bank. HSBC originally had a 14% stake in Axis bank but had to bring it down to 4.99% due to RBI regulations. HSBC’s investment in Yes Bank is its second investment after Axis Bank.
According to the RBI regulations, foreign banks can hold only a 5% stake in a bank. The RBI also permits foreign banks operating in India to open around 12 to 14 branches in a year.
According to published reports, HSBC has around 47 branches and 170 ATMs, while Yes Bank has 60 operational branches, 75 ATMs and it has got permission from the RBI to set up additional 57 branches and 125 ATMs.
Business Standard quoted Rana Kapoor, managing director and CEO of Yes Bank, as saying: Like Rabo Bank investments, HSBC Financial Services Middle East’s investment in Yes Bank should be viewed as a financial investment. There is no arrangement for any co-operation with HSBC at this stage.