YES Bank rockets high up on confirmation by government

As part of the efforts to bail out the private lender, the government has approved a plan for State Bank of India (SBI) to lead a consortium that will buy a stake in YES Bank. The public-sector bank has also been authorised to pick other members of the consortium.

The troubled YES Bank had failed to attract any strategic investors even while approaching mutual funds for raising fresh equity capital. This led the private lender to substantially scale down its fundraising plans. Many rating agencies had also previously downgraded the rating for the bank with outlook to rating-watch negative. The bank’s troubled days first started when its founder and former Chief Executive Officer (CEO) Rana Kapoor was declined an extension by Reserve Bank of India (RBI) in 2018, owing to corporate governance issues and under-reporting of bad loans. YES Bank had plans to raise capital up to USD 2 billion, in order to expand its capital base which looked highly doubtful.

Reacting to the news, on Thursday, the stock of YES Bank rocketed by 25.94 per cent or Rs 7.60 per share to Rs 36.90. The 52-week high is Rs 2,885.90 and 52-week low is Rs 28.05.

The stock of SBI was trading at Rs 285.75, up by 0.16 per cent or Rs 0.45 per share. The 52-week high is Rs 373.70 and 52-week low is Rs 244.35 on BSE.