Today: Jun 18, 2024

SBI to buy 49% stake in Yes Bank for Rs 2,450 cr

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New Delhi: The State Bank of India (SBI) on Saturday announced it will pick up a 49 per cent stake in Yes Bank for Rs 2,450 crore and clarified that all the deposits and liabilities of the reconstructed bank will continue in the “same manner”.

The crisis-hit Yes Bank, which failed to garner investor support in raising capital, was on Thursday superseded by a Reserve Bank appointed administrator, in consultation with the central government, and customers have been restricted with a withdrawal cap of Rs 50,000 only till April 3.

“Yes Bank has 255-crore shares of Rs 2 per share. SBI will be issued 245 crore shares at a price of Rs 10 per share for Rs 2,450 crore. This will be 49 per cent of the share capital of the reconstructed bank,” the State Bank said in a statement.

“SBI shall not reduce its holding below 26 per cent before completion of three years from the date of infusion of the capital,” it added.

The SBI also said that a board of directors will be constituted at the reconstructed Yes Bank comprising chief executive and managing director, non-executive chairman and non-executive directors.

“SBI shall have nominee directors appointed on the board of the reconstructed bank. RBI may appoint additional directors to the board. The members of the board so appointed shall continue in office for a period of one year, or until an alternate board is constituted by Yes Bank Ltd,” the statement said.

The RBI has appointed Prashant Kumar, former deputy managing director and chief financial officer of SBl, as an administrator of Yes bank.

Earlier, the Reserve Bank had released the draft of Scheme of Reconstruction of Yes Bank and invited suggestions and comments up to Monday, March 9, 2020.

It said that all the employees of the reconstructed Yes Bank shall continue in their service with the same remuneration and on the same terms and conditions of service, at least for a period of one year.

“The board of directors of the reconstructed bank will, however, have the freedom to discontinue the services of the key managerial personnel (KMPs) at any point of time after following the due procedure,” the SBI statement noted.

All the deposits with and liabilities of the reconstructed bank will continue in the same manner, the country’s largest lender said, adding, the instruments qualifying as additional tier-1 capital shall stand “written down permanently, in full”.

Also, the offices and branches will continue to function in the same manner and the bank reconstructed bank would be allowed to open new offices and branches or close down existing offices or branches, the SBI said.

“Rights and liabilities of the reconstructed bank all contracts, deeds, bonds, agreements, powers of attorney, grants of legal representation and other instruments of whatever nature shall be effective to the extent and in the same manner, as was applicable before the scheme,” it added.