Money & Banking

YES Bank ‘very stable’, CEO Gill says after stock slide

Reuters Mumbai | Updated on October 03, 2019 Published on October 03, 2019

File photo   -  REUTERS

YES Bank's Chief Executive Officer (CEO) Ravneet Gill assured investors on Thursday that the bank remains on solid financial footing, sending its stock as much as 25 per cent higher.

"The recent price drop does not reflect the bank's performance," he said during a conference call, adding the operating metrics and fundamentals of the bank were sound.

His remarks come after the stock plunged nearly 23 per cent on Tuesday as fraud allegations against a housing finance company that Yes Bank has exposure to, spooked investors. A stake sale by its promoters also weighed on sentiment.

Two of the bank's promoter companies, led by former CEO Rana Kapoor and his family, said on Thursday they cut stakes over the last two weeks to reduce debt in their own companies, further seeking to allay investor concerns.

“We have enough liquidity, we are very stable and the share price movement of recent days should not become a proxy for how the bank gets perceived,” said Gill.

He also said the bank was in talks with private equity firms, strategic investors and family offices to raise additional capital.

Yes Bank also said that there was no incremental stress building up in its loan book, but a credit squeeze in the broader economy had an impact on the overall asset quality of the bank.

The lender's management added they have been trying to conserve capital by reducing wholesale lending, while increasing it to government and small and medium enterprises (SMEs).

“The asset quality has held up pretty well. We are absolutely 200 per cent confident that we are good," said Chief Risk Officer Ashish Agarwal, speaking about the bank's bad loan recoveries.

Speaking on a dip in the bank's current and saving account (CASA) share, the management assured that the reduction in deposit was not a result of withdrawal pressure from depositors.

In the quarter ended June, the bank had reported gross slippages of Rs 6232 crore, while recoveries and upgrades were at Rs 1678 crore.

Published on October 03, 2019
  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.