New Delhi, Aug. 25 -- The Reserve Bank of India (RBI) has allowed Japan's Sumitomo Mitsui Banking Corp. (SMBC) to acquire up to 24.99% in Yes Bank, marking the largest potential cross-border investment in India's banking sector.

This move not only reshapes Yes Bank's ownership structure but also brings a deep-pocketed global player into the private banking space. Mint explains what this means for Yes Bank, SMBC and the banking sector.

The Reserve Bank of India's (RBI) nod to Sumitomo Mitsui Banking Corporation (SMBC) to acquire up to 24.99% in Yes Bank on Saturday marks the largest potential cross-border investment in India's banking sector and a turning point in the private lender's journey.

In May, the Japanese bank announced a Rs.13...