Hopeful of moratorium being lifted this week: Yes Bank administrator
Mumbai: In what may calm harried depositors of Yes Bank, its administrator Prashant Kumar on Monday said he is hopeful of the moratorium on the private sector lender being lifted by Saturday.
Merging Yes Bank with itself will have a "negative impact" on SBI, and an independently running institution should continue to do so after some help, Kumar, the former chief financial officer of SBI, said, dismissing speculation of an amalgamation. He also said that life insurance behemoth LIC was never approached for infusing capital and is not part of the plan now as well.
Kumar was installed as the administrator of the bank by the Reserve Bank of India last Thursday, after the central bank superseded Yes Bank's board as it found that there was no headway in capital raising plans.
"We are hopeful that we will be able to work around, where the moratorium will be lifted by this weekend," he said, making it clear that moratorium lift-off and the capital raising plans are "unconnected".
"The trigger (for the lift-off of moratorium) will be approval of final (resolution) plan by RBI," he said, adding that work on fund raising is on in parallel. Yes Bank has been put under a moratorium by the Reserve Bank till April 3, and customers are not allowed to withdraw more than Rs 50,000 from their accounts.
On the capital raising, where there are reports of the bank needing at least Rs 20,000 crore to spring back to normalcy, he declined to give an estimate of the requirement but said it would like for most of the fund raising to happen in the first round itself.
"As of now, we are expecting that most of our capital requirement will be met initially itself. It may or may not happen. Definitely our plan is that we should complete the (entire) capital raising requirement before declaration of annual results, which is May 31, 2020," he said. Kumar said it is possible that depositors may make a beeline to withdraw or transfer their deposits out of the bank once the moratorum is lifted and added that while there is no case for the depositors to act this way, Yes Bank has commitments from both the RBI and SBI to help with liquidity.
