Yes Bank soars over 25% on report SBI-led group to buy stake, shares of largest public sector bank drop over 5%

Bengaluru: Shares of Yes Bank Ltd surged 25.6 percent to Rs 36.80 on Thursday on a report that the Indian government has approved a plan for top lender State Bank of India to lead a consortium that will buy a stake in the troubled private-sector bank.

#BREAKING | Govt is said to have approved @TheOfficialSBI's plan to buy stake in @YESBANK, said to ask SBI to form consortium for Yes Bank stake (Via Bloomberg) pic.twitter.com/lMEJaEd6aV

— CNBC-TV18 (@CNBCTV18Live) March 5, 2020

Shares of SBI fell as much as 5.4 percent after local TV channel CNBC-TV18 cited here the report by Bloomberg, before reclaiming some lost ground to trade 1% lower by 0554 GMT. Yes Bank and SBI did not immediately respond to Reuters request for comment. [caption id=“attachment_5595711” align=“alignleft” width=“380”]  Representational image. Reuters.[/caption] Yes Bank has struggled to raise capital it desperately needs to stay above regulatory requirements as it battles high levels of bad loans due to its exposure to troubled sectors. The lender has been trying to raise $2 billion in fresh capital for two quarters. In January, the bank said it had rejected a $1.2 billion investment offer from Canadian investor Erwin Singh Braich and Hong Kong-based SPGP Holdings - an offer about which many analysts had expressed doubt. Yes Bank said in February that it will delay its December-quarter results by at least a month.