Sumitomo Mitsui Banking Corporation (SMBC) of Japan has received in-principle approval from the Reserve Bank of India (RBI) to establish a wholly owned subsidiary (WOS) in India by converting its existing branch operations in the country. The RBI confirmed that the approval allows SMBC to transition from a branch-based model to a locally incorporated subsidiary.
The development follows earlier reports that SMBC was preparing to seek regulatory clearance for the move. Once operational as a wholly owned subsidiary, the Japanese lender would be in a position to expand its local footprint and operate with greater flexibility in India’s banking market.
SMBC currently holds close to a 25 per cent stake in Yes Bank, most of which was acquired in May 2025. Previous reports have suggested that if SMBC secures approval to function as a subsidiary, State Bank of India and other domestic banks could sell their combined remaining stake of around 14 per cent in Yes Bank to SMBC, potentially allowing it to become a majority shareholder. However, Yes Bank has denied that any such plan is currently in progress.
In India, SMBC operates through four branches in New Delhi, Mumbai, Chennai and Bengaluru, along with a branch at the International Financial Services Centre (IFSC) in GIFT City, Gujarat. The RBI said the in-principle approval has been granted for setting up the wholly owned subsidiary through the conversion of these existing branches.
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