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Informist, Wednesday, Aug 28, 2024

By Darshan Nakhwa and Kshipra Petkar

MUMBAI – Reports of Mitsubishi UFJ Financial Group Inc eyeing a stake in YES Bank are "speculative" in nature, said the bank's Asia Pacific Chief Executive, Masakazu Osawa, on the sidelines of the Global Fintech Fest 2024 today. "We cannot comment on that," he said.

In the last few months, several news organisations have reported that the Japanese bank is eyeing a stake in YES Bank. The Indian lender has sought approval from the Reserve Bank of India to sell up to 51% stake, paving the way for new ownership after it faced a severe crisis just four years ago. Currently, State Bank of India is the biggest shareholder of YES Bank with a 24% stake. The public sector bank has pared its holding in YES Bank after rescuing it four years ago when it was inundated with bad loans.

On making investments in India and the target segments, Osawa said, "Strategically, we are not only looking at the financial return. They have great technology around, especially financial services, which can be deployed in our service. In India, we are focusing on a large corporate business."

"Transaction banking is crucial for our business, like deposit taking, trade finance, and LC (letter of credit) issuance, and forex platform. So, if any startup has that specific technology and ideas, that can be deployed directly to our products and service then for sure. And, we also have partner banks that cover SMEs (small and medium enterprises) and retail business in Thailand, Indonesia, Vietnam, and Philippines. If anyone could have good technology to contribute to those products, we would definitely wish to deploy those ideas, for sure. And, yeah, so these are the strategies we like to pursue," Osawa said.

Currently, MUFG has close to $10 bln exposure in India, including to large corporate businesses. In the start-up space, the Japanese bank has funded little over 100 companies in the last five years with $2.7 bln, according to Osawa.

In the medium-term, MUFG plans to grow its India exposure – onshore and offshore lending - by over 25% annually and take it to over $25 bln, Shashank Joshi, MUFG's Deputy CEO and head of global corporate and investment banking in India, was quoted as saying by Business Standard.  End

US$1 = 83.95 rupees

Edited by Ashish Shirke

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