Yes Bank tanks on ratings downgrade

The private bank's stock tanked 10 per cent after the credit rating agency Moody’s junk-rated its foreign currency issuer rating on Tuesday.

Moody's Investors Service downgraded Yes Bank's foreign currency issuer rating to Bal from Baa3. The accessor stated governance concerns as a major reason for the rating revision. With this, Yes Bank is India's only private bank that is junk-rated. 

On the other hand, a new report alleged that Yes Capital, which is owned by Rana Kapoor family invested funds borrowed from mutual funds in a finance company, thereby converting it into equity. The bank's promoter Rana Kapoor and family invested the funds as equity in ART Capital Limited, which invested a part of the money in ART Housing Finance through subsidiaries. Rana Kapoor and family hold 10.7 per cent stake in Yes Bank. 

Bank has denied these allegations and said that it is not involved fund management of the companies referred to in this news report.

At 15:07 hours, the stock of Yes Bank was quoting Rs. 163.30 per share, down by Rs. 19.85 or 10.84 per cent close to its intraday low of Rs. 164.25 per share, on Wednesday.