Yes bank share price – Yes bank on verge of closure – Latest news.
Yes Bank dips as the latest news, now eyes on RBI.
The country’s fifth major private bank – Yes bank share price fell with the latest news. Yes Bank has reached the verge of closure. If it is not announced to be closed, then it could create problems for millions of customers in the future. Now the Reserve Bank of India will have to take a quick decision about this so that the deposits of small investors can be saved from sinking. The bank has only till March, in which it has to take a decision.
Founder, co-founder out of bank.
According to a Bloomberg report, co-founders, who run the country’s fifth-largest private bank, have been implicated in bad corporate loans to the bank. Institutional shareholders are exiting the bank. Small investors are investing in the hope that Yes Bank will arrange the funds. The new management of the bank is looking at unsuccessful options for fund raising. These options range from a Canadian billionaire to an anonymous IT company. At the same time, the bank’s founder Rana Kapoor and co-founder have completely exited by selling all their shares.
There is a possibility of sinking loan due to closure of bank
The bank has two options till March. The first is to declare it closed. Secondly, it should be merged with any government or private bank, so that there is no risk of small investors depositing capital and employees going to jobs. If the bank closes, then it will have a negative impact on the entire banking sector. With this, it will not be good news for the government either.
Share price fell 88 percent in 17 months.
YES Bank shares, which are struggling with capital problems, have fallen by 88 per cent in the last 17 months. Its stock has fallen by five per cent on Friday and by eight per cent on Monday. 36% of the capital of the bank is involved in bad loans. At present, there is a high possibility of bank loan sinking. 40% of the bank’s deposits belong to those who can change their mind at any time. In such a situation, the problem of solvency and liquidity will remain for the bank.
May merge with SBI. RBI intervention needed.
It is difficult to operate independently of the condition of Yes Bank. There is no other way than to close it. Investors who have stuck their money in the co-operative bank are already marginalized. For Yes Bank, merging it is the last way. In such a situation, Kotak Mahindra Bank was asked if it would buy it. Bank chairman Uday Kotak did not express any interest in it. SBI hardly agrees to merge Yes Bank. But apart from SBI, there is hardly any bank that can digest YES Bank’s $ 31 billion loan.
On Monday, Yes Bank share price closed at the level of 42.15, down 2.60 points or 5.81 per cent. While it opened at 43.40 level in early trade. At the same time, it had closed at the level of 44.75 on the last trading day i.e. Friday. Subsequently, its market capitalization reached Rs 107.25 billion.
There was talk of investment in November
In November 2019, eight investors were ready to invest more than Rs 14000 crore in Yes Bank, which is facing a capital crisis. Among these eight investors were Rekha Jhunjhunwala, wife of Rakesh Jhunjhunwala. Yes Bank had then reported that a total of eight investors, including Canadian industrialist Arwin Singh Brecht, Aditya Birla Family Office and Rekha Jhunjhunwala, would invest Rs 14348 crore. However, the bank recently rejected Irwin Singh Brich’s $ 1.2 billion investment proposal.
Uttam Prakash Aggarwal, the independent director of Yes Bank, has resigned from the post expressing serious concerns over malfunctions and other issues in operating the company. In his resignation letter to Yes Bank non-executive part-time chairman Brahm Dutt, he said, “I resign from the membership of independent directors of YES Bank, chairman of audit committee and all other committees of the board of directors with immediate effect.” The letter has questioned the CEO and MD Ravneet Gill, among others, referring to the fall in corporate operating standards.
Ravneet Gill, who replaced Rana Kapoor as CEO, needed huge capital to run the bank. The bank had a market cap of Rs 11,426.12 crore on Friday. Let us know that for the first time on 1 October 2019, Yes Bank share price came below 30 rupees.