Cabinet Clears Bailout Plan For Crisis-Hit Yes Bank: 10 Things To Know

  1. The lender is also in talks with other prospective investors, the Finance Minister said. They would need to maintain at least 75 per cent of their investments for a minimum of three years, Ms Sitharaman added. 
  2. There will be a three-year lock-in period for all the investors, she said. However, the lock-in period for SBI would be only for 26 per cent of the shareholding.
  3. As part of the RBI-backed rescue plan for the troubled private sector lender, State Bank of India (SBI) will acquire up to 49 per cent stake in Yes Bank, and will be required to maintain a minimum holding of 26 per cent in Yes Bank for three years. All the existing Yes Bank's employees will be retained as part of the deal. 
  4. "The notification (on the reconstruction scheme) shall come out and the moratorium shall cease on the third working day from the date of the notification, at 1800 hours," the Finance Minister said, while speaking to reporters about the current cap on withdrawals from Yes Bank accounts. 
  5. She also said the administrator's office will be vacated after seven calendar days following the lifting of moratorium, and a new board will be constituted. The RBI has placed Yes Bank's board under an administrator, Prashant Kumar, who is a former deputy managing director and CFO of SBI.
  6. In a separate development, ICICI Bank's board approved investment of Rs 1,000 crore in Yes Bank through equity. ICICI Bank said it will buy 100 crore equity shares of Yes Bank at Rs 10 per share.
  7. State Bank of India, the country's largest lender by assets, had the previous day approved a plan to purchase 725 crore Yes Bank shares at a price of Rs 10 apiece.
  8. The government placed Yes Bank - the country's fifth-largest private sector lender - under a moratorium last week following a serious deterioration in the bank's financial position.
  9. Yes Bank's founder and former managing director, Rana Kapoor, is in police custody until March 11 after he was arrested on money-laundering charges. 
  10. Struggling under a growing pile of bad debt, Yes Bank had been trying to raise the required capital to stay above regulatory requirements. Initially, Yes Bank wanted to raise $2 billion, which was later brought down to $1.2 billion as it could not rope in any investor.  In February, the bank delayed the release of its financial results for the October-December period.
Unlock this article for free
Sign up to access exclusive stories, fewer ads, and a personalised experience.
Set as Trusted Source
on Google Search
Add NDTV Profit As Google Preferred Source