Of the Rs 1,100 crore, Rs 900 crore would be in the form of equity shares and Rs 200 crore in the form of preference shares.
After getting its board’s consent, Yes Bank has applied to the Reserve Bank of India (RBI) requesting approval for an increase in its authorised share capital, the private sector lender notified the exchanges on Wednesday.
After the RBI clears the proposal, the bank will seek approval from shareholders. The bank said that the board has approved an increase in the share capital and further delegated powers to the capital raising committee of the board and its MD and CEO for capital raising.
“The bank has received strong interest from multiple foreign as well as domestic private equity and strategic investors for this capital raise and remains firmly on course to raising growth capital subject to the necessary approvals,” Yes Bank said in its communication to the exchanges.
The bank’s board had on August 30 approved raising the growth capital for the bank to Rs 1,100 crore from Rs 800 crore now. Of the Rs 1,100 crore, Rs 900 crore would be in the form of equity shares and Rs 200 crore in the form of preference shares.
On Wednesday, shares of the Yes Bank closed at Rs 53.70 on the BSE, down 4.19% from the previous-day close.
The lender has been grappling with asset quality troubles and a soaring provisioning burden since the beginning of FY20. To take care of its capital position and meet regulatory stipulations on the same, Yes Bank has been tapping prospective equity investors.
The bank’s shares, too, have been under pressure of late amid negative newsflow, including the downgrade of its client Reliance Capital, a default by another firm — Altico Capital — to which it has an exposure and a cut in Morgan Stanley’s price target for the bank earlier this month.