Plan in Place, Team Working On It: SBI Chief on Yes Bank Crisis
Comments from stakeholders have been invited till 9 March on the draft scheme for Yes Bank.
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SBI Chairperson Rajnish Kumar on Saturday, 7 March, addressed the media on the plan for the crisis-ridden Yes Bank, saying that a plan has been received by SBI and the legal team is working on it.
“We had informed through the stock exchange that SBI board has given in-principle approval of exploring possibility of picking up a stake of up to 49 percent in Yes Bank,” he said.
The interest of SBI shareholders will not be compromised and depositors would not be adversely affected, Kumar said on Saturday, reiterating what he had said on Friday.
As far as SBI’s balance sheet and SBI’s shareholders are concerned, there is no reason to be alarmed, he further said.
He also said that SBI's capital ratios would not be impacted by this investment and there would not be a need to raise any further capital from the market or government either.
“There are many potential investors who have approached us after seeing the scheme of reconstruction for Yes Bank,” Kumar said, adding that they would have to see how investors value Yes Bank.
Moreover, he said that there was no question of a merger of Yes Bank with SBI and no question of any conflict of interest.
RBI Reveals Draft Scheme of Reconstruction
The Reserve Bank of India (RBI) on Friday had unveiled a draft scheme of reconstruction for the crisis-ridden Yes Bank, a day after the central bank imposed a moratorium on the capital-starved bank, capping withdrawals at Rs 50,000 per account for a month.
The RBI also said the strategic investor bank will have to pick up 49 percent stake and it cannot reduce holding to below 26 percent before three years from the date of capital infusion.
From the appointed date, the authorised capital of the private sector bank would stand altered to Rs 5,000 crore and number of equity shares to 2,400 crore having face value of Rs 2 each, reported PTI.
Prashant Kumar Releases a Statement
Prashant Kumar, the ex-Chief Financial officer of SBI and new administrator of Yes Bank, said, "The current moratorium has been brought into effect keeping the depositors' interest in mind and towards restoring their confidence. A solution is being worked upon to revive the bank well before the moratorium period of thirty days ends."
In a statement issued by Yes Bank, he also said, "The bank is also taking necessary steps to ensure seamless transactions for the customers. We assure the depositors that their money is safe and there is absolutely no reason to panic."
SBI Board Gives ‘In Principal’ Investment Approval
Earlier, PTI reported that the SBI board has given the largest lender an "in-principle" approval to invest in the capital-starved Yes Bank. The central board of SBI discussed the matter at a meeting on Thursday, it informed the exchanges.
According to reports, the government has asked SBI and life insurance behemoth LIC to collectively pick up a 49 percent stake in Yes Bank.
The latest development comes six months after the regulator did the same with the city-based cooperative lender PMC Bank after a large scam was unearthed.
Yes Bank has been grappling with mounting bad loans.
Rahul Gandhi Accuses Government of 'Destroying' Economy
"No Yes Bank," Congress leader Rahul Gandhi said on Friday, taking a dig at the BJP-led government over the moratorium placed on Yes Bank, and alleged that Prime Minister Narendra Modi and his "ideas" had destroyed the country's economy.
Former Finance Minister P Chidambaram also took to Twitter to lash out at the government, questioning whether it was concerned at all and pointed out that Yes Bank’s crisis had followed on the back of the PMC Bank crisis.
(With inputs from PTI.)
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