Yes Bank says $3 billion investment offers on table
04 Nov 2019
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Investors have lined up with proposals to pump in $3 billion into troubled private lender, Yes Bank, the bank said on Saturday, adding that it has also received a binding $1.2 billion capital offer from a North America-based family that has never invested in India.
The bank is also in discussions to raise $1.6 billion from a clutch of six global private equity funds and two domestic mutual funds, as per Gill.
Gill’s statement comes amidst reports that the government of Singapore is negotiating with PMO and RBI for DBS to acquire 51 per cent stake in Yes Bank.
As per current rules banks (including foreign banks having branch presence in India) can acquire up to 10 per cent stake in other banks. However, in case of exceptional circumstances, such as weak banks, the Reserve Bank of India (RBI) may permit them a higher level of shareholding.
Both DBS and Yes Bank, however, said reports are unfounded and baseless.
However, the bank said it is in touch with two groups of domestic investors to raise $300 million, adding that this includes two family offices and two financial investors.
"We have $3 billion of potential money which can come in and will be looking at all the options with an open mind," Gill said.
The capital adequacy ratio of the bank has dipped in the last few quarters due to the accelerated recognition of non-performing assets (NPAs) under chief executive, Ravneet Gill.
He said the bank may opt for either a single investor or multiple investors participating in the fundraiser.
The bank needs the money quickly, he said, hinting that two tech investors that the bank is speaking with may not participate immediately.
Its common equity tier-I capital buffer will go up by 2.60 per cent over the 8.7 per cent in September 2019 if the $1.2 billion funds come in, he added.
Gill had replaced the promoter-chief executive Rana Kapoor early this year.
