YES Bank’s Reconstruction Program is leading the SBI bank. How this decision is taken to know that read the whole article.
Yes Bank Ltd, this is the fourth largest private bank of India. Which was put under cessation by an order notified by the RBI on March 5, 2020? The Reserve Bank of India has commanded that the rapidly worsening financial position of the bank with interest to liquidity. Capital and other significant parameters, and the absence of any trustworthy plan for infusion of capital have compelled immediate action in the common interest. Particularly in the interest of the depositors.
On March 6 the RBI has placed in the public domain a draft scheme of modernization of it. The RBI has proposed suggestions and comments from the public — including the banks’ shareholders, depositors, and creditors — on the draft scheme. Reportedly, the draft scheme has also been sent to YES Bank and the State Bank of India for their comments. The RBI has informed that it will receive suggestions and comments up to March 9.
With all this information The Finance Minister on March 6 said that the government expects YES Bank’s reconstruction plan to become effective by April 3.
Reasons:
YES Bank has 255-crore shares of ₹2 per share. SBI will be issued 245 crore shares at a price of ₹10 per share for ₹2,450 crores. This will be 49 percent of the share capital of the reconstructed bank,” the SBI said in a statement.
YES Bank has been struggling to raise capital amidst its drawing financial health. It inquired to raise USD 2 billion initially during this monetary, which was then clipped to USD 1.2 billion as it could not rope in any investor. This is the main reason behind the YES Bank’s Reconstruction program.
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