Tag: Prashant Kumar

Yes Bank won’t dilute equity soon, BFSI News, ET BFSI

Banking & Finance

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Yes Bank will not be raising capital via equity soon and the recent board approval is only part of an enabling provision to reduce its time-to-market in future, the bank’s MD & CEO Prashant Kumar, said. He added that the bank’s deposits will cover its loan book by end-March despite growth in advances.

“We expect the credit-deposit ratio to be 100% by the end of March from 116% at the end of December,” Kumar said. He said that the bank’s strategy is to use its digital capability to grow retail deposits and loans. According to its December quarter results, the bank’s capital adequacy ratio is 19.6%, while common equity tier I capital is 13.1%, “We are well-capitalised but we decided to go through the process, which will also require a shareholder approval, so that we are in readiness,” said Kumar.

The private bank, which was revived by an RBI-initiated resolution process, had seen a third of its deposits being withdrawn by wary customers before the central bank placed a moratorium on withdrawals. Since then, deposits have bounced back growing 36% in the first nine months of the fiscal. The bank on Friday reported a profit of Rs 151 crore in the third quarter as against a loss of Rs 18,560 crore in the year-ago period.

The bank also said that it has received more information on accounts linked to whistleblower allegations. “All the loans are fully provided for and there will not be any financial implication even if any more loans are declared as fraud,” said Kumar. He said that Cox & Kings, which has been in the news for action by authorities, has already been declared a fraud.

The bank had earlier sought approval from the RBI for a ‘bad bank’ that will take over troubled loans and is awaiting a response from the regulator. While the bank has a Rs 1,000-crore exposure to DHFL, it does not expect any major recovery this year. “I do not expect the resolution will be implemented before March 31. Besides, we are unsecured lenders and don’t know how much we will get,” he said.

“Our focus is on retail and MSME. We have disbursed almost Rs 12,000 crore in the third quarter and this path would continue,” said Kumar. He said the bank was rationalising expenditure with operating expenses reduced by 13% and more branch mergers in the offing. The bank has already converted some of its rural branches into business correspondent centres. To augment fee-income, the bank has tied up with HDFC Life and SBI Life for distribution on the life insurance side and ICICI Lombard and SBI General on the non-life insurance side.



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This is the peak in terms of NPAs and slippages: YES Bank chief

Banking & Finance

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Private sector lender YES Bank will focus on recoveries and opening CASA accounts and believes that Covid-related stress on its books would start easing in coming quarters.

“Our understanding is that this is the peak in terms of non-performing assets and slippages and now it would start coming down,” said Prashant Kumar, Managing Director and CEO, YES Bank.

Three factors

Kumar attributed this to three factors –improving collection efficiency, lower cheque bounce rates and throughput through accounts.

Also read: YES Bank posts Q3 net of ₹151 crore

“Collection efficiency is now at 96 per cent as against pre-Covid level of 97 per cent. The cheque bounce rate, which was normally at seven per cent to eight per cent rose to 18 per cent during Covid and is now at nine per cent. Through put through accounts has also reached almost pre-Covid levels. It means there is good churning in accounts, incidence of bounce backs are not there,” he told BusinessLine in an interaction after the bank’s third quarter results.

For the quarter ended December 31, 2020, YES Bank posted a standalone net profit of ₹150.71 crore with robust growth in net interest income. However, gross NPAs stood at 15.36 per cent of gross advances with proforma gross NPAs at nearly 20 per cent. The bank has also invoked loan restructuring of ₹8,062 crore.

Kumar expressed confidence that the bank’s Covid-related provisioning of ₹2,683 crore will take care of the restructuring invoked and also likely slippages.

On turnaround of the bank

When asked about the turnaround of the bank since the reconstruction scheme, Kumar expressed satisfaction in terms of the business strategy but highlighted the need for higher recoveries and taking care of the pandemic impact on the loan book.

“Turnaround in the sense of the business strategy and going on that path is very clear. But one part of the turnaround is the recovery from existing NPAs. The real turnaround story will be complete when you will recover a substantial portion. The impact of pandemic on the loan book and how to take care of it in the next 12 months,” he said.

The private sector lender has made recoveries of about ₹3,000 crore and has a target of ₹5,000 crore for the fiscal year.

“The P&L impact of the recovery was about ₹2,500 crore. It is very positive. We would like to touch the target of ₹5,000 crore and hopefully be near it,” he said.

As part of its deposit mobilisation efforts, YES Bank is also targeting opening one lakh CASA accounts per month. In December, it opened 85,000 accounts.

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Yes Bank rolls out Yes MSME offering funding, knowledge partnerships & digital solutions to MSMEs, BFSI News, ET BFSI

Banking & Finance

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Yes Bank has rolled out Yes MSME, a comprehensive proposition enabling easy access to funding, knowledge partnerships and digital solutions.

The start-up programme offers collateral free loan up to Rs 5 crore, offers comprehensive micro-segmented services, facilitates easy access to capital with lower TAT and minimal documentation among other host of benefits with partnerships and technological opportunities.

The bank said in a release, “The YES MSME proposition focuses on supporting MSMEs in expanding their business, sustaining momentum and accelerating growth through solutions across lending, deposits, insurance, customized and segmented digital solutions for retail, manufacturing, wholesale, trade and service providers. This also includes special current account offerings for the self-employed segment.”
The bank has partnered over 700+ associations to take this ahead.

Nitin Gadkari, Union Minister for MSMEs and Road Transport and Highways, said, “The MSME sector is the backbone of the Indian economy and accounts for 30 per cent of the economy creating 11 crore jobs so far. Investment in the sector is the need of the hour and we are hopeful that concerted efforts by the industry and the Government will help expand it. I congratulate YES BANK for this new addition under their MSME sector initiative and the long-term plan to strengthen the ecosystem.”

Prashant Kumar, MD and CEO, YES BANK, said at the launch, “YES BANK remains committed to supporting the growth of this employment-intensive sector and contribute to the growth of the economy. The Bank’s enhanced value proposition will improve access to finance for MSMEs and support their technology upgrade, among other customer-focused measures. I am confident that our measures will have tangible outcomes and contribute to the collective vision of a self-reliant nation.”

The bank said, “The unique endeavour is yet another step for a meaningful push to increase the GDP contribution of the MSME sector – which came under strain in the aftermath of COVID-19 – from the current 30 per cent to 50 per cent, as the Government of India has envisioned.”



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