Mumbai: State Bank of India Chairman Rajnish Kumar on Tuesday said that the state-run bank will not sell any of its shares in the crisis-hit Yes Bank in the next three years.Also Read - Shares of SBI Cards Make Weak Debut With 13% Discount at Rs 658

The SBI has been allotted 605 crore shares in Yes Bank for an investment of Rs 6,050 crore and would be the largest shareholder in the restructured bank with a stake of 49 per cent. Also Read - Nirmala Sitharaman Snubs SBI Chairman: Purported Audio Clip Gets Leaked

Its statement gains significance as the reconstruction plan for Yes Bank said that the largest public sector bank will have to hold at least 26 per cent stake for the next three years. Concerns of a possible profiteering by the investing banks have arisen as the prevailing share price of Yes Bank is nearly six times the price at which the domestic banks have subscribed to its shares. Yes Bank shares closed at Rs 58.65 a piece on BSE on Tuesday. Also Read - Yes Bank Crisis: Cabinet Approves Bailout Plan, SBI to Invest up to 49% Equity

Rajnish Kumar on Tuesday said that although he cannot talk about other banks, regarding SBI, “not even a single share will be sold in three years”.

Other private sector banks who have put in a total of Rs 3,950 crore so far, would have to hold at least 75 per cent of their investment for a three year period under the terms of restructuring scheme.

Even if such entities want to sell the 25 per cent of their investment now, which they are free to execute under the scheme, they would end up not only recovering their entire investment but also making windfall gains.

Among the private players, ICICI Bank and Housing Development Finance Corporation committed Rs 1,000 crore each. Axis Bank and Kotak Mahindra Bank committed to invest Rs 600 crore and Rs 500 crore, respectively. Both Federal Bank and Bandhan Bank have been allotted shares for Rs 300 crore each as per their commitment and IDFC First Bank has been issued equity shares in the crisis-ridden bank for a consideration of Rs 250 crore.

Rajnish Kumar said that it was decided that a two-stage funding should be carried out for Yes Bank as trying to raise the total required capital in one go would have extended the moratorium on the private sector lender.

“Enough money was available, but in the first stage (it was decided) let it be within Indian domestic bankers. Lot of foreign investors had interest… but that would mean longer moratorium,” he said.

As the bank has already raised Rs 10,000 crore, it has now adequate space to complete the second stage funding by bringing in more investors.