Shares of Yes Bank surged nearly 8 per cent in the early trade on Wednesday after reports that the private lender is planning to raise funds via qualified institutional placement this week. At 11:08 AM, the shares of Yes Bank were trading at Rs 91.15 per share, up 6.73 per cent from the previous close on BSE. The shares had opened marginally higher at Rs 86.65 per share on the exchange. According to the reports, the private lender’s management has met key domestic investors over the last few days for the QIP. Motilal Oswal and JM Financial have been appointed as the bankers to the QIP issue, as per reports.
Yes Bank is likely to raise around $500 million and private equity firms like GIC and Westbridge may participate in the QIP besides investment bank HDFC AMC, the reports said. Rating agency Moody’s had recently announced its decision to keep Yes Bank’s rating “under review for downgrade,” for the second time in two months on account of declining asset quality and higher exposure to shadow banks.
Yes Bank posted a net profit of Rs 113.8 crore in Apr-Jun June, lower by 91 per cent from the net profit of same quarter last year as provisions shot up 185% year-on-year (y-o-y) to Rs 1,784 crore. Net interest income (NII) increased by 2.8% y-o-y to Rs 2,281 crore. Net interest margin (NIM) fell 20 basis points (bps) sequentially to 2.8%. Pre-provisioning operating profit dropped 28% y-o-y to Rs 1,959 crore. Asset quality at the bank deteriorated from the previous quarter, with the gross non-performing asset (NPA) ratio rising 179 bps to 5.01% and the net NPA ratio inching up 105 bps to 2.91%.