SBI Board gives 'in-principle' approval for investment in Yes Bank

The SBI board has given the largest lender an "in-principle" approval to invest in the capital-starved Yes Bank. The central board of SBI discussed the matter at a meeting on Thursday, it informed the exchanges.

The announcement came hours after Yes Bank was placed under a moratorium, with the RBI capping deposit withdrawals at Rs 50,000 per account for a month and superseding its board.

"The matter in regard to Yes Bank was discussed at the meeting of the central board of bank on Thursday and an in-principle approval has been given by the board to explore investment opportunity in the bank," the SBI board informed the bourses late in the evening.

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According to reports, the government has asked SBI and life insurance behemoth LIC to collectively pick up a 49 per cent stake in Yes Bank.

Speaking in Davos, Switzerland, earlier this year, SBI chairman Rajnish Kumar said Yes Bank, which had over Rs 2 lakh crore in deposits as of September, will not be allowed to go down. Appreciating its investments in technology, he said the bank has a strong brand.

Earlier, Kumar also suggested that Yes Bank's rival Kotak Mahindra Bank is best placed to takeover the lender.

Reports of the takeover led to a 25 per cent jump in Yes Bank in trading on Thursday, while the SBI scrip closed 1.05 per cent up at Rs 288.30 a piece at the end of trade. 

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