By P.R. Venkat
State Bank of India and half a dozen Indian private-sector banks have agreed to invest 100 billion rupees ($1.35 billion) to support troubled lender Yes Bank Ltd.
State-run SBI, which is leading the bailout by taking a 49% stake in Yes Bank, will be joined by private-sector lenders including Axis Bank Ltd., Kotak Mahindra Bank Ltd., ICICI Bank Ltd. and Housing Development Finance Corp., according to a stock-exchange filing by Yes Bank administrator Prashant Kumar late Sunday.
Earlier this month, India's central bank seized control of Yes Bank and superseded the board of directors of the bank, citing "serious deterioration" in the lender's financial position.
The Reserve Bank of India had put a moratorium on the bank and appointed Mr. Kumar as the administrator.
In a separate filing late Sunday, the administrator said the moratorium will cease from March 18 and a new board will be reconstituted within seven days from the cessation of moratorium.
Mr. Kumar will be the chief executive of Yes Bank, according to the filing.
Yes Bank was started in late 2003 by Indian entrepreneur and investment banker Rana Kapoor, its surviving co-founder and former CEO. After getting a banking license in 2004 and going public in 2005, it quickly grew into one of India's leading private-sector banks, with more than 1,000 branches and ATMs across the country.
For the third quarter ended December, Yes Bank's net loss was INR185 billion and its gross nonperforming assets were at INR407.09 billion.
Write to P.R. Venkat at email@example.com