Faith restored in Yes Bank: More deposits in last four days, less withdrawals

By: |
March 17, 2020 5:04 PM

While the Reserve Bank of India had imposed a moratorium on the bank and had capped withdrawals at Rs 50,000 per person, only one-third of the customers actually withdrew the amount, bringing more money to Yes Bank.

Yes Bank had touched 52 week low of Rs 5.55 apiece after RBI had imposed the moratorium on the bank.

Troubled private lender Yes Bank has received more deposits in the past four days than withdrawals. “We have done our extensive analytical study of customer behaviour, only one-third of the customers have withdrawn Rs 50,000 during the period, and in the last 4 days we have had more inflows than outflows,” Yes Bank’s new administrator Prashant Kumar told reporters on Tuesday. While the Reserve Bank of India had imposed a moratorium on the bank and had capped withdrawals at Rs 50,000 per person, only one-third of the customers actually withdrew the amount, bringing more money to Yes Bank.

Further, the bank believes that customers will not rush to withdraw money and it has sufficient funding lines to meet any requirement, Prashant Kumar added. RBI is expected to lift the moratorium on the bank on Wednesday evening, and Yes Bank will resume normal services soon after.

Meanwhile, SBI chairman Rajnish Kumar said that India’s largest PSU bank will not offload a single share of the 49% stake that it has picked up in Yes Bank, trying to reinstate the confidence in the troubled private bank. Eight banks have so far come to the rescue of Yes Bank and Prashant Kumar called the reconstruction of India’s fourth largest lender historic. Prashant Kumar will take over the reigns of the bank as the MD & CEO from the end of this week.

Yes Bank depositors had earlier withdrawn massive amounts of money from the private lender as they anticipated troubles at the bank. As the bank failed to take care of rising NPAs, about Rs 18,000 crore were withdrawn between April to September 2019, The Indian Express reported earlier.

Yes Bank share prices continued to rally and shot up close to 60% on Tuesday as eight firms including ICICI Bank, HDFC, Kotak Mahindra Bank, Axis Bank, and IDFC Bank said that they will pick up stakes in the bank. Yes Bank had touched 52 week low of Rs 5.55 apiece after RBI had imposed the moratorium on the bank.

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