Swift action will be taken to revive Yes Bank: RBI Governor Shaktikanta Das
Mumbai/IBNS: Reserve Bank of India (RBI) governor Shaktikanta Das on Friday said the crisis-hit Yes Bank will be revived by the country's central bank very "swiftly" and "fast".
Addressing media a day after reports claimed the State Bank Of India (SBI) and Life Insurance Corporation (LIC) are likely to buy 49 per cent stake in Yes Bank, Das said, "Swift action will be taken to revive Yes Bank."
"It will be done very swiftly and fast. We have given 30 days as the outer limit," he said.
In a major crisis for Yes Bank, the government on Thursday imposed a withdrawal limit of Rs 50,000 for depositors of the beleaguered private bank.
A notification, issued by the finance ministry on Thursday evening, said the limit will stay in effect till Apr 3, 2020.
The restriction has been imposed as a part of an order of moratorium issued by the government which also stayed the "commencement or continuance of all actions and proceedings" against the bank.
However, the limit will have few exemptions likes in cases of medical emergency, higher education, marriage and unavoidable emergency, the notification mentioned.
When he was asked whether the central bank was late to step in to take action, Das on Friday said, "Bank and its management need time to take steps. When we felt that we should not wait for longer, the RBI decided to step in."
"RBI will come out with a scheme," he added.
Meanwhile, the bank's board has been superseded for a period of 30 days "owing to serious deterioration in the financial position of the Bank", the RBI had said in a separate statement
Former SBI CFO Prashant Kumar has been appointed as administrator for Yes Bank.
Yes Bank is facing a major crisis to raise capital to sustain its operations, after being hit by bad debt.
"SBI and LIC will be acquiring preferential shares in the private sector bank at Rs 2 per share," ET Now reported quoting sources. The two state-owned entities will pay Rs 490 crore for the stake, the report claimed.
Earlier, Yes Bank held discussions with several leading investors including global stressed asset specialist JC Flowers & Co, Tilden Park Capital Management, OHA (UK) (part of Oak Hill Advisors) and Silver Point Capital to raise funds.
(Image Credit: Wikipedia)
Support Our Journalism
We cannot do without you.. your contribution supports unbiased journalism
IBNS is not driven by any ism- not wokeism, not racism, not skewed secularism, not hyper right-wing or left liberal ideals, nor by any hardline religious beliefs or hyper nationalism. We want to serve you good old objective news, as they are. We do not judge or preach. We let people decide for themselves. We only try to present factual and well-sourced news.
