Assuring depositors of the stressed lender Yes Bank, the current administrator Prashant Kumar on Tuesday, said that the bank has seen more inflows rather than withdrawals, before the lifting of the moratorium on Wednesday, at a press conference in Mumbai. Stating that the bank was prepared for any contingency, he said that all ATMs have been refilled with cash. Reiterating RBI governor's advice that there were no deposits from private sector banks, he said that complete normalcy will be restored.
"Only 1/3rd of our customers have withdrawn Rs 50,000 during the moratorium. Customers' feedback is that they don't feel the need to withdraw money from the bank. We have had higher inflows than outflows in the last few days. We have sufficient funding lines to meet any contingency. Complete normalcy will be restored, all branches and employees are ready," he said.
He added, "We are happy to announce that moratorium will be lifted from 6 pm tomorrow. We have taken adequate precautions, all our ATMs are full of cash, branches have an adequate supply. RBI governor assured that there is no need to withdraw deposits from pvt sector banks".
Talking about the future of the company, he said that the brand was strong and if revamping the management will be decided by the board. He also revealed that the bank is expecting to recover Rs 8500 crores of the NPA declared by it. Talking about the first focus of Yes Bank, he added that the bank plans to maintain being 60% retail and 40% corporate bank.
"The brand is very strong. There is no need to change the employees or mode of working. Have you seen such a large reconstruction in such a less time?" he said. When asked about the revamping of the bank working, he added, "Our first focus would be on building the deposit franchise. We will want to shift to 60% on retail and 40% on corporate. The decision will be taken to revamp the management by the board. We are expecting Rs 8500 crore recovery in NPA in the next financial year."
Adding to Kumar's statement, SBI Chairman Rajnish Kumar said that the SBI will increase its stake in Yes Bank to 49 % from the current 42 pc in the second funding round. When asked as to why SBI was asked to intervene, when Yes Bank was trying to raise funds, he said, "Yes Bank is raising the fund, there was enough money available. But the conscious decision was taken to keep it within Indian domestic banks".
Yes Bank which has been facing a crisis as it accumulated many bad loans in 2018 by lending to corporate defaulters such as DHFL, Jet Airways and Cafe Coffee day, was put on a moratorium by RBI for a period of 30 days, capping its withdrawals at Rs 50,000 - but is scheduled to be lifted on March 18. The RBI has also announced ‘Yes Bank Ltd. Reconstruction Scheme, 2020’ altering the authorised capital to Rs 5000 crores and 2400 equity shares standing at Rs 10 each. Moreover, SBI which leads the consortium of banks investing in the 'reconstructed bank' will not reduce its holding below 26% before the completion of three years. Yes Bank reported on Saturday a staggering Rs 18,654-crore loss for the December quarter as its gross non-performing assets shot-up to Rs 40,709 crore.