Yes Bank Crisis

History
•Started its operations in 2004
•Founder- Rana Kapoor, Ashok Kapoor
•Deposits 2 Lakh cr, Assets- 3.5 L cr

•NPA are estimated about 10-11% i.e. 17000cr

•Its loan book rose to 35% where as it should was around
10% overall bank credit.
Reason of crisis
Its NPA was about 10-11% whereas benchmark rate 4%
Loan book grew about 4%
Loan book 2,24,505 cr, deposits were 2,09,497 cr.
Loans given by Rana Kapoor to those companies which
were already bankrupt and couldn’t repay its loan
amount.
Failure in raising capital led to downgrading of Yes
bank by credit rating
Capital Restructuring
SBI to be minor shareholder of 49%. Fv=10 (premium
of 8)
26% of its holding cannot be diluted for next 3 years
ICICI & HDFC bank to invest 1000cr in yes bank
AXIS bank to invest 600cr
Kotak Mahindra Bank to invest 500cr
Main stakeholders in yes bank
Depositors
Investors in yes bank (11%)
Investors in SBI (49%)
Instituional Investors (60%)