ICAI to review Yes Bank financials

New Delhi, March 11: Chartered accountants' apex body ICAI said it will review financial statements of Yes Bank for the last two financial years even as the bank's administrator expressed hope that a deal could be struck with bondholders who have opposed the terms of the rescue plan laid out by the Reserve Bank of India.

The Institute of Chartered Accountants of India said its Financial Reporting Review Board (FRRB) would take up the review of general purpose financial statements of Yes Bank for 2017-18 and 2018-19.

"In case the FRRB finds any material/ serious non-compliance, it would refer the case to the Director (Discipline) of ICAI for initiating action against the auditor...," the institute said in a statement on Monday.

Prashant Kumar, the RBI-appointed administrator of Yes Bank, said "We are in the process," of resolving the issue with the bondholders, who will have to take huge writedown by the current rescue plan. He said a deal

would be reached later on Wednesday or on Thursday.

Citing sources, a TV channel said bondholders had proposed to convert Rs 8,500 crore worth of bonds into Rs 1,700 crore equity.

Axis Trustee Services Ltd, which represents several investors in Additional Tier 1 (AT1) notes issued by Yes Bank, has already filed a petition with the Bombay High Court against the RBI rescue plan.

Mutual fund body Amfi said equity investors should be the first to take the brunt in case of Yes Bank's restructuring, followed by preference shareholders, and the AT1 bondholders should be the last to be touched.

The asset management companies have made representations to both Sebi and RBI regarding the same, Amfi's chief executive N. S. Venkatesh said.

In the restructuring package proposed last week, the RBI had suggested that over Rs 8,000 crore of investments by MFs and bank treasuries in the AT1 bonds should be written-off completely. Ratings agency Icra has said over Rs 93,000 crore of investor wealth is riding on such bonds, which form a crucial part of the capital buffers for banks.

—Agencies