Tag: Yes Bank

YES Bank | Dish TV: Freeze on Yes Bank’s 25.6% stake in Dish TV spooks private lenders, BFSI News, ET BFSI

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Private credit lenders who often provide finance against pledge of shares are rattled that they will not be able to exercise their rights as lenders, if a police move freezing Yes Bank’s 25.6% stake in Dish TV sets a precedent.

On Tuesday, the Supreme Court will hear Yes Bank’s appeal against an Allahabad High Court order that dismissed the lender’s plea seeking to lift the freeze on its voting rights in Dish TV, which is operated by Subhash Chandra’s Essel Group. At the high court, Yes Bank had challenged a move by Uttar Pradesh’s Gautam Buddh Nagar crime branch last week to freeze its voting rights in Dish TV.

Dish TV has scheduled an annual general meeting on Tuesday (November 30) to seek shareholders’ consent to its Rs 1,000 crore rights issue – a move that is opposed by Yes Bank, the largest shareholder. “The private lender will not be able to exercise its voting rights if the Supreme Court does not restore it,” said one of the lenders.

The court is likely to hear the matter in the first half of the day, while the AGM is scheduled at 3.00 pm.

Yes Bank on September 3 had suggested reconstitution of Dish TV’s board and opposed the proposed rights issue as it would dilute its holding in the company.

Private equity lenders say equity pledge is one of the most liquid collateral and freezing it is a major setback.

“The courts in India might eventually resolve this issue. However, if the police interfere and even cause a few months delay in enforcing security, then the value of the debt gets significantly eroded,” said one of the lenders, who did not want to be named.

Private credit providers are also rattled that a police complaint was filed when there are well-established procedures for dispute resolution, such as the National Company Law Tribunal. Further, the case was registered at the crime branch in Uttar Pradesh when both Yes Bank and Dish TV have their registered offices in Mumbai.

One of the lawyers present at the Allahabad High Court said Yes Bank’s senior counsel, Abhishek Manu Singhvi, pointed out that “the UP sub-inspector will become supreme and can tomorrow attach paintings in Kerala and homes in Mumbai based on frivolous complaints filed by defaulting borrowers”.

The UP crime branch order follows a complaint by Subhash Chandra against the bank, accusing its former chief executive, Rana Kapoor, of fraud in brokering a merger between Videocon D2H and Dish TV. Kapoor is facing allegations of financial irregularities at the bank and is currently in jail.

Yes Bank had provided a Rs 5,270 crore loan to Essel group of companies against the pledge of Dish TV shares in 2016. After the group companies of Essel started defaulting, Yes Bank invoked the shares in June 2020 and recalled the loan the following month. IndusInd Bank, L&T Finance, housing finance company, HDFC Ltd and Clix Capital are among other lenders to have invoked the share pledge of Dish TV.

Subhash Chandra first filed an FIR against Yes Bank at Greater Noida in September 2020 and initiated a civil proceeding against the bank at Delhi’s Saket District Court for invocation of shares. The Saket court initially restrained Yes Bank from selling the shares but withdrew the proceedings in August 2021.

On November 6, Dish TV informed the stock exchange that it has received orders from the UP-crime branch to restrict Yes Bank from the dealing with 445.3 million shares (amounting to a 25.6% stake) of Dish TV until the investigation is completed or further order. On November 7, Dish TV informed the exchanges about the proposed EGM on November 30.



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Yes Bank partners Amazon Pay for UPI, chooses AWS for payment processing, BFSI News, ET BFSI

Banking & Finance

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Mumbai: Yes Bank has partnered with Amazon Pay and AWS to offer UPI payment to users. In FY21, Yes Bank recorded a market share of around 40% by volume in the UPI ecosystem and around 30% by volume in the UPI merchant acquiring business thanks to the integration with PhonePe.

The integration with Amazon Pay will enable the US e-commerce giant, which is a late entrant into the payment space, to issue UPI IDs with the @yapl handle. The tie-up will further expand Yes Bank’s presence in UPI with its payment processing platform hosted on AWS.

Based on a multi-bank model, this collaboration allows Yes Bank to acquire merchants through the Amazon Pay platform, adding to its existing merchant network.

The private lender said it has developed a cloud-native UPI processing platform to optimally handle the high traffic of transactions observed during surge periods like festivals or annual sales.

“With this collaboration, we will be able to offer our customers more control, flexibility and choice for a vast range of purchases and peer-to-peer transactions — through UPI-based payments,” said Prashant Kumar, MD & CEO, Yes Bank.

According to Mahendra Nerurkar, CEO and VP, Amazon Pay, the company plans to expand its digital payment network by making it more rewarding for customers. “UPI is one of the most convenient and popular ways to pay in India. With a cloud-native architecture we hope to keep raising the bar on availability, speed and customer experience using UPI through the Amazon app,” said Nerurkar.



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Yes Bank collaborates with Amazon Pay and AWS to offer UPI payment services

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Yes Bank on Thursday announced its collaboration with Amazon Pay and Amazon Web Services (AWS) to offer customers an instant real-time payment system through a UPI transaction facility.

“The integration enables Amazon Pay to issue UPI IDs with the @yapl handle, allowing customers to make secure, fast, and convenient payments,” it said in a statement.

Based on a multi-bank model, this collaboration allows Yes Bank to acquire merchants through the Amazon Pay platform, further extending the lender’s presence in the UPI merchant business segment.

Cloud-native UPI processing platform

The private sector lender said it has developed a cloud-native UPI processing platform to optimally handle the high traffic of transactions observed during surge periods like festivals or annual sales. It is hosting its UPI processing platform on AWS.

“With AWS, the bank will have more flexibility to scale with the exponential growth in UPI volumes driven by high customer demand,” it further said.

Yes Bank is one of the market leaders in UPI payments. In fiscal 2020-21, it recorded a market share of around 40 per cent by volume in the UPI ecosystem and around 30 per cent by volume in the UPI merchant acquiring business.

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YES Bank CIO, BFSI News, ET BFSI

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Automation will become an imperative rather than a good-to-have in the next 2-3 years while hyper-personalisation will see a lot of innovations after six to eight months, according to Mahesh Ramamoorthy, Chief Information Officer, Yes Bank.

If any bank wants to get into new service or product enhancements it will need straight-through processing or zero ops. A lot of learning will come from some of the good fintech companies that have enabled themselves and have dedicated to building the scale at a very low human footprintMahesh Ramamoorthy, Chief Information Officer, YES Bank, at the Fireside Chat during ETBFSI Converge.

Hyper-personalisation

Hyper-personalisation, he said, was at a nascent stage and a lot of banks are on that journey. There are a lot used cases for hyper-personalisation such as if a customer is doing a purchase and wants money, the bank should be able to triage customer location, profile request along with banking risk and give the customer the money. Another use case is the dispute journey where the transaction could be invalid, incorrect leading to reversal. If we could service the customer using automation or give the customer the progress of the dispute giving another self-experience it would be a defining moment, he said

Saving costs

With automation banks can, on one hand, save costs on the other drive the business. It creates more availability for the customer that increases the standing of the bank in the market. Creating efficiencies in the back office leads to more business in the front office, which leads to driving growth of not just accounts but also balances, Ramamoorthy said.

Despite automation, there are instances where manual intervention is needed, such as customer queries where multiple touchpoints are needed to be addressed, the banking could pull in the information but the service would be needed to be done manually.

He said the bank is open to understanding how fintech firms create accelerated journeys, deployments, service enhancement. “We have a huge focus on partnerships. most of the automation that the fintechs have brought to the table especially when thy use latest tools there have been good learnings,” he said.

Automation’s objective is to move to zero ops, with effective means and very minimum manual intervention. identifying critical processes, to create customer experience, efficiency with a sufficient amount of risk control.



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Yes Bank invokes pledged shares of Asian Hotels (North) Ltd, BFSI News, ET BFSI

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Yes Bank has acquired over 7 per cent stake in Asian Hotels (North) Ltd after invoking pledged shares as the company defaulted on loan repayments. In a regulatory filing on Friday, the lender said it has acquired 14,02,991 equity shares by way of invocation of pledge, constituting 7.21 per cent of the issue paid-up share capital of Asian Hotels (North) Ltd.

“Shares have been acquired pursuant to invocation of pledge of shares of borrower subsequent to default/breach of terms of credit facilities sanctioned by the bank to the borrower,” Yes Bank said.

The bank said the proceeds from the sale of shares will be utilised to reduce the loan secured by such shares.

Asian Hotels (North), which is into the hospitality sector, had a turnover of Rs 72.58 crore as on March 31, 2021.



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Moody’s upgrades Yes Bank on improved financing health, BFSI News, ET BFSI

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Moody’s Investors Service Wednesday upgraded Yes Bank‘s credit rating citing improved financial health.

The global rating company provided a new grade of B2, a notch higher than its previous level B3.

The bank, which was once counted among top rated private sector lenders, remains in the high-yield category that has higher funding costs compared to lenders in the investment grade.

The rating company changed Yes Bank’s outlook to ‘positive’ from ‘stable’ earlier.

“Moody’s has upgraded Yes Bank’s issuer rating to B2 from B3 because its funding and liquidity have substantially improved in the past year, which have strengthened depositor and credit confidence in the bank,” it said late Tuesday.

It also promoted Yes Bank’s Baseline Credit Assessment (BCA) and Adjusted BCA to b3 from caa2, a two-notch improvement.

The outlook change reflected Moody’s expectations of further improvement to the bank’s credit profile, driven by a clean-up of legacy stressed assets and/or improvements to its capital and profitability.

“The rating action also reflects the fact that despite the significant economic challenges since the onset of the pandemic, Yes Bank’s asset quality has deteriorated only modestly while its capital has remained stable,” the rating agency said.

About one and a half years ago, Moody’s Investors Service downgraded Yes Bank’s rating following the Reserve Bank of India imposing a 30-day moratorium that prevented the lender from making payments to its creditors.

The bank had also gone through a management change with former co-founder Rana Kapoor now facing several legal charges.

Yes Bank’s deposits increased over 65% between 30 September 2021 and 31 March 2020, after Indian regulators rescued the bank. Its deposit quality has also improved; current and savings account and retail term deposits represent 45% of total funding as of 30 September 2021, compared with just 31% as of 31 March 2020.

The bank has reduced its share of market funding, while its average liquidity coverage ratio (LCR)improved to 118% as of 30 September 2021 from 40% as of 31 March 2020.

Yes Bank’s asset quality remains weak and continues to pose risks to its profitability and capital, Moody’s said.

Yes Bank shares were a tad lower to close at Rs 13.03 on BSE Tuesday.



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Moody’s upgrades Yes Bank’s ratings, changes outlook to positive

Banking & Finance

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Moody’s Investors Service has upgraded Yes Bank’s ratings and changed its outlook to positive, reflecting its expectations of a further improvement in the lender’s credit profile due to clean-up of legacy stressed assets and improvements to its capital and profitability.

The rating agency has upgraded Yes Bank’s foreign currency issuer rating and long-term foreign and local currency bank deposit ratings to B2 from B3, it said on Wednesday.

Also see: Yes Bank launches co-branded card with BankBazaar.com

Further, it has also upgraded Yes Bank’s Baseline Credit Assessment (BCA) and Adjusted BCA to B3 from Caa2 and has changed the outlook on the bank’s ratings where applicable to positive from stable.

Liquidity improves

“Moody’s has upgraded Yes Bank’s issuer rating to B2 from B3 because its funding and liquidity have substantially improved in the past year, which have strengthened depositor and credit confidence in the bank,” it said, adding that the rating action also reflects the fact that despite the significant economic challenges since the onset of the pandemic, Yes Bank’s asset quality has deteriorated only modestly while its capital has remained stable.

Asset quality remains weak

It, however, noted that the private sector lender’s asset quality remains weak and continues to pose risks to its profitability and capital.

Given the positive outlook, Moody’s could upgrade Yes Bank’s ratings if the bank’s asset quality and/or capital materially improve. However, the agency could downgrade the bank’s ratings and BCA if its capital deteriorates significantly because of a strain on its asset quality, or if its funding and liquidity deteriorate.

Also see: Moody’s upgrades outlook for Indian banking system

For the quarter ended September 30, Yes Bank had reported a 74.3 per cent jump in its standalone net profit to ₹225.5 crore from a year ago.

Gross NPAs was at 14.97 per cent of gross advances as on September 30, 2021 versus 16.9 per cent a year ago.

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Yes Bank plans legal action on police order, BFSI News, ET BFSI

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Yes Bank is understood to be planning legal action against the Gautam Buddh Nagar police order disallowing the private lender from dealing with or exercising rights over shares of DishTV. This is a part of the bank’s attempts to recover loans to the group.

According to legal experts, the bank can seek redressal from the Allahabad HC against the police order. The police have issued a notice under Section 102 of the Criminal Procedure Code, which gives them power to seize property that is allegedly stolen or there is reasonable suspicion. The notice was issued on a case based on a complaint by Subhash Chandra, chairman of Essel Group. The FIR is understood to have been lodged in September 2020.

The private bank, which is the largest shareholder in DishTV with a stake of over 24%, has sought to oust the management. The bank had acquired a stake in the broadcaster after invoking a pledge on shares that were offered by the Essel Group promoter. The pledges were invoked after the promoter defaulted on its loans. The Essel Group, which has come under stress, had managed to extract a standstill agreement from other lenders. Yes Bank has continued to pursue recovery and moved a resolution to sack CEO Jawahar Goel and other independent directors.

However, last Saturday, DishTV informed the stock exchanges that the UP Police have issued a notice to the bank asking it not to deal with DishTV shares or exercise any rights in respect of them.



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Shopify survey, BFSI News, ET BFSI

Personal Finance

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– Kruthikaa Lakshman

Contactless payments, especially UPI, is gaining traction this Diwali. Nearly 50% of festive shoppers said that they preferred to process payments via UPI as
opposed to any other form, a survey by e-commerce platform Shopify said.

The survey found that the preference for UPI remains consistent across both, online and offline shopping experiences.

The COVID-19 pandemic has had a lot to do with these trends, the survey said. Though the experience that predates the festival is anticipated by many, the
convenience and safety of online shopping has persisted by 76.9% of the shoppers this festive season, it added.

Shopify India released “The Festive Shopping Outlook Report 2021”, measuring consumer trends in the last month, in time for Diwali. Trends have shown that the festive shoppers who would traditionally begin buying for the season, a month in advance hadn’t done so this year.

With mobile phones and internet access to non-metro shoppers, more and more people were seen opting for the digital medium. Online shopping is prevalent after the pandemic has increased to larger areas of the country, according to the report.

60% shoppers use digital payments multiple times a week for festive season shopping: Survey

Contactless payment using radio frequency identification (RFID) or near field communication (NFC) is also constantly improving. The National Payments Corporation of India (NPCI) recently partnered with YES Bank to launch RuPay On-the-Go contactless payments solutions, which is further pushing shoppers to opt for contactless payments, the survey added.

Further, the survey said that the digital payments platform has been opened by Google Pay for use in contactless UPI patents as well.

In terms of what shoppers shopped for during the season, the survey finds that gold and precious metal jewellery, which have been traditional festive gifting favorites, seem to have fallen out of favor this year.

This year, most shoppers were seen investing in tech gadgets. Electronic gadgets, according to the survey, are all set to command maximum consumer gifting budgets with close to 42% respondents showcasing increased propensity towards it.



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White Oak Capital completes acquisition of YES Bank’s MF business, BFSI News, ET BFSI

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NEW DELHI: Clearing the way for entering the mutual fund industry, White Oak Capital on Tuesday said it has completed the acquisition of YES Asset Management, which was previously owned by YES Bank.

The company, founded by renowned money manager Prashant Khemka, had received Sebi’s nod for registration of GPL Finance as a sponsor and change in control of YES Asset Management and YES Trustee Limited to GPL Finance back in September.

“We welcome the YES Asset Management team and their investors as well as channel partners into the White Oak family. Together with them, we are excited to further build upon the foundation laid by all of us till date,” said Khemka.

We are excited about offering our investment expertise to retail investors across the country and we aim to launch a range of funds post necessary regulatory approvals and subsequent launch through the first half of CY2022, he added.

Prashant Kumar, Managing Director & CEO, YES Bank, said, the move, aligned with the bank’s sustained efforts to enhance value creation for all our stakeholders, will lead to significant gains for both companies and, more importantly, our customers.

“With this transaction, the bank remains committed to re-channelizing resources as part of our overall strategy to drive growth and innovation in our offerings.”

YES Securities acted as an exclusive advisor to the transaction. Samvad Partners acted as legal advisor to YES BANK, while Khaitan & Co, IC Universal Legal and Regstreet Law Advisors were legal advisors to White Oak Capital on the transaction.



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