Rana Kapoor, the former managing director and chief executive at Yes Bank Thursday denied reports that he is attempting a comeback to the bank and said he has full confidence in his successor Ravneet Gill.
Rana Kapoor, the former managing director and chief executive at Yes Bank Thursday denied reports that he is attempting a comeback to the bank and said he has full confidence in his successor Ravneet Gill. Kapoor’s term was curtailed by RBI due to a slew of concerns, including poor governance and loan practices. Gill took over on March 1 and began a massive clean-up which resulted in the bank booking a maiden quarterly loss of over Rs 1,500 crore.
“Media reports have suggested that I am attempting a comeback to the board, in spite of my unequivocal denial to them,” Kapoor said in a series of tweets. Kapoor, who continues to hold over 9 percent in the bank, said he has “the fullest confidence and conviction” in Gill and the board. Terming Gill’s efforts as “Hanumanian”, probably comparing it with the efforts mounted by one of Lord Ram’s devotees in Hindu mythology, Kapoor exuded confidence that the bank will overcome this “transitional phase”.
The Rana Kapoor promoter group fully supported and voted in favour of the 19 resolutions put up at the AGM held Wednesday. Some of the investors voiced concerns on the state of corporate governance at the lender at the meeting, according media reports. Two directors — Ajai Kumar and Mukesh Sabharwal — had quit the board in the run-up to the AGM, fuelling speculation on what are the causes for the sudden action.
Earlier in the week, global ratings agency Moody’s had threatened to downgrade the bank’s rating citing its large exposures to the struggling non-banking lenders and realty segments and ruled an upgrade over the next 12-18 months. The bank has plans to raise up to USD 1 billion in core capital. For the March quarter, the bank had posted a loss of Rs 1,506 crore because of heightened provisioning on risky exposures of Rs 10,000 crore which were flagged off as the ones likely to slip into NPAs.
Kapoor’s tweets come on a day when the bank scrip is being hammered, possibly as a reaction to a report by Swiss brokerage UBS, which sharply cut its price estimate on the stock saying the risks of NPAs is higher than current expectations. It also expects the metrics, including margins, fee income and loan growth to “deteriorate significantly” in FY20, while cutting the stock price expectation to Rs 90. There was also a report saying the bank has dropped out of the list of the ten most valued lenders. The bank scrip was trading 10.10 percent down at Rs 121.05 on the BSE at 1357 hrs, as against a 0.34 percent correction on the benchmark.