The final reconstruction scheme for the crisis-ridden YES Bank got Cabinet nod on Friday. The rescue plan, as proposed by the RBI, envisages State Bank of India (SBI) picking up 49 per cent stake in the troubled private lender.
Meanwhile, in separate filings with the bourses, ICICI Bank, Axis Bank and Kotak Mahindra Bank said they would be investing in YES Bank. While ICICI Bank will pump in ₹1,000 crore by picking up 100 crore shares at ₹10 each, Axis Bank proposes to invest ₹600 crore (60 crore shares of ₹2 each at a premium of ₹8). Kotak Mahindra Bank will invest ₹500 crore by acquiring 50 crore equity shares at ₹10 per share. On its part, Housing Development Finance Corporation ( HDFC ) will infuse ₹1,000 crore.
The board of SBI, on Thursday, had approved investment of ₹7,250 crore in YES Bank. Already, LIC, a promoter of Axis Bank, owns 8.06 per cent in YES Bank.
Finance Minister Nirmala Sitharaman said that the moratorium — which placed a ₹50,000 withdrawal limit on YES Bank depositors — will be lifted on the third working day (at 1800 hrs) from the date of the notification of the approved scheme. “The final scheme will get notified soon,” she added.
Within seven days, a new Board of YES Bank will be constituted and two nominees of SBI will be part of the reconstructed YES Bank as directors. The administrator will vacate office after seven days from the cessation of the moratorium and a new Board will be constituted.
SBI’s investments will have a three-year lock-in for 26 per cent of the 49 per cent stake it will hold. For the other private investors, there will be a three-year lock-in, but for 75 per cent of their investments, she said.
Hike in authorised capital
YES Bank’s authorised capital will be raised from ₹1,100 crore to ₹6,200 crore to accommodate immediate and subsequent capital raise, she said, adding that the details will be worked out soon.
Asked about the treatment of AT-1 bonds, Sitharaman said that the matter was before the court and she would not like to comment on the same.