Yes Bank board reconstituted with immediate effect; Prashant Kumar to be new MD-CEO

WION Web Team New Delhi, Delhi, India Mar 26, 2020, 08.46 PM(IST) Edited By: Sonal Gera

File photo. Photograph:( Reuters )

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The bank on March 5 was put under moratorium by RBI due to financial mismanagement under its former MD and CEO Rana Kapoor, who currently is in the custody of probe agencies.

The cash-strapped Yes Bank’s board on Thursday was reconstituted with immediate effect with the appointment of eight members pursuant to “Yes Bank Limited Reconstruction Scheme, 2020”.

The bank had earlier approved the reconstitution of its board with Prashant Kumar as the new MD and CEO.

The board comprises of Sunil Mehta as non-executive chairman, Mahesh Krishmurthi as non-executive director, Atul Bheda as non-executive director, R Gandhi as additional director appointed by Reserve Bank of India, Anand Narayan Gopalakrishnan as additional director appointed by Reserve Bank of India, Partha Pratim Sengupta as director appointed by State Bank of India, Swaminathan Janakiraman as director appointed by State Bank of India, and Prashant Kumar as managing director and CEO.

The bank on March 5 was put under moratorium by RBI due to financial mismanagement under its former MD and CEO Rana Kapoor, who currently is in the custody of probe agencies.

Yes Bank had also failed to raise enough capital to keep afloat.

The board of the bank was superseded with immediate effect, and other financial activities such as granting new loans, investment, among others, were also curbed. 

Meanwhile, as per ICRA’s estimates, Yes Bank would require equity infusion of Rs. 9,000-13,000 crore to meet the regulatory capital requirements including the Capital Conservation Buffers (CCB). As the regulatory norms require banks to maintain a CCB of 2.5 per cent as on March 31, 2020.

As per the bank’s rescue plan outlined by RBI, SBI will have a stake of 49 per cent in Yes Bank through capital infusion of Rs 7,250 crore.

(With inputs from agencies)