Your Money Safe, Says Finance Minister As Yes Bank Crashes 85%: 10 Points
- The decision on Yes Bank was taken at a "larger level" and not at individual entity level, and was aimed at ensuring the safety of financial system, RBI governor said further. The RBI governor also assured, "RBI stands ready to intervene in whatever way required to respond to epidemic challenges". (Also Read: Sensex Tanks 1,000 Points; Virus Spread, Yes Bank Crisis Rattle Investors)
- "The RBI is fully ceased of the matter and has assured they will give a quick resolution. I want to assure every depositor that their money shall be safe. Their moneies are safe. I'm constantly in contact with the RBI and the steps that are taken are taken in the interest of depositors, bank and economy. We are fully of ceased of the development," Ms Sitharaman told reporters in New Delhi.
- After the Reserve Bank of India placed Yes Bank under the moratorium and imposed withdrawal limit, the stock price of the Mumbai-based private lender crashed 85 per cent to hit an intraday low of Rs 5.65 on the National Stock Exchange. The stock closed at Rs 36.80 on Thursday.
- While placing the bank under the moratorium, the central bank said that the bank's financial capability had undergone a steady decline largely due to the inability of the bank to raise capital.
- State Bank of India, the country's largest lender, is exploring a wide range of rescue options for struggling Yes Bank including a complete buyout of its private-sector rival, Reuters reported, quoting sources familiar with the matter.
- Moody's said the moratorium was credit negative as it affected timely repayment of depositors and creditors and added that the lack of coordinated action highlighted continued uncertainty over bank resolutions in India.
- "Effectively, Yes Bank should have no equity value left," Sandip Sabharwal, a Mumbai-based fund manager said.Â
- "We believe forced bailout investors will likely want the bank to be acquired at near zero value to account for risks associated with the stress book and likely loss of deposits," JPMorgan analyst Saurabh Kumar said in a note, as it cut its price target on the lender to Rs 1 from Rs 55 a share.
- Domestic stock markets suffered sharp losses in early trade on Friday amid a selloff across the world as the spread of the coronavirus pandemic stoked fears of recession. RBI's action of seizing control of the beleaguered Yes Bank and possible ramifications on the financial system also dented sentiments on Dalal Street.
- The S&P BSE Sensex index nosedived as much as 1459.52 points to hit 37,011.09 on the downside in the first few minutes of trade, and the broader NSE Nifty benchmark dropped to a low of 10,827.40, down 441.60 points from the previous close.
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