Sumitomo Mitsui Banking Corporation (SMBC) has received preliminary approval from the Reserve Bank of India (RBI) to establish a wholly owned subsidiary in India.
The Japanese bank currently maintains branches in New Delhi, Mumbai, Chennai, and Bengaluru, as well as an office at the International Financial Services Centre in GIFT City, Gujarat.
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According to the central bank, this initial approval paves the way for SMBC to convert its existing Indian branches into a subsidiary, subject to regulatory compliance.
The RBI noted that a final banking licence will be considered once all stipulated conditions are met.
The RBI stated the “in-principle approval has been granted to the bank for setting up a WOS through the conversion of its existing branches in India,” and added conversion would proceed only after verifying compliance with all requirements set under this approval.
In September last year, SMBC announced an agreement with CA Basque Investments, affiliated with The Carlyle Group, to increase its interest in Yes Bank by a further 4.2%.
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By GlobalDataThis development followed SMBC’s earlier acquisition of a 20% stake in Yes Bank in May last year, which was purchased from State Bank of India and other investors.
The transaction for the initial 20% holding was valued at Rs 134.8bn ($1.57bn), including a 13.19% acquisition from SBI and 6.81% from other banks.
Recently, SMBC Group made headlines by closing its digital banking division in the US, Jenius Bank.
This decision impacted 161 employees across various US locations.
