Two years later India’s central bank had to initiate to take control over Yes Bank to relax panicky depositors and stem systemic risk, the lender is focusing to thicken its loan book and obtain smaller rivals to save its business, its chief executive said. The development plan of the mid-sized lender proceeds after it hiking $1.1 billion last week by trading up to a 10% stake to Carlyle Group and Advent International. The fundraising marked as a rare vote of confidence ever happened in Yes Bank, which had to be acquired by the central bank in March 2020 after months of decrease in its financials and allegations of mismanagement. The lender also managed to increase the capital, its first until July 2020, at a time when the perspective for the banking sector in many overseas markets has faded due to slowing economic growth, which is anticipated to weigh on asset quality and loan demand. In spite of the moderate improvement in its financials in the preceding few quarters, some analysts are of the view that it would take a number of years before the bank would be capable to show meaningful growth and security of its key financial ratios.
In the current fiscal year, the bank revealed a profit of 10.66 billion Indian rupees ($134 million) compared to a loss of 34.62 billion rupees the last year. The CEO Prashant Kumar is assured that its stabilizing capital position will result in an improved rating of the bank, which will bring in more business and aid profitability. However, analysts and investors remain unsure about the same.
ALL INDIA LEGAL FORUM 