Yes Bank shares tank after Ind. director quits
Kerala has attracted Rs 1 lakh crore investment proposals, going by entrepreneur feedback at the Global Investors Meet, chief minister Pinarayi Vijayan said at the conclusion of the event in Kochi, held with the aim of enhancing ease of doing business in the state. Overall, the two-day ASCEND 2020 event received 164 investment proposals, Vijayan said.
Yes Bank’s shares and dollar bonds plunged after an independent director resigned, citing corporate governance concerns at the lender.
Uttam Prakash Agarwal said he resigned on Friday, citing what he described as deteriorating standards of corporate governance and compliance failures. He blamed the bank’s Chief Executive Officer Ravneet Gill and other senior executives for the alleged failings.
Yes Bank shares fell 5.3 per cent to Rs 44.80 on the BSE, the biggest drop in a month. Its 3.75 per cent dollar notes due in February 2023 declined 4.7 cents on the dollar to 79.9 cents, the biggest plunge in over three months.
Agarwal’s claims will be examined, Yes Bank said in a filing confirming the resignation.
Agarwal also stepped down as the head of its audit committee. Countering his claims, the bank said he was facing a 'fit and proper' status review as directed by the Reserve Bank of India.
A former ICAI president, Agarwal was appointed as an independent director in November 2018 for a five-year term when Rana Kapoor was managing the bank.
The capital-starved bank also reported setbacks in its $2-billion fundraising plans. It said the board has approved a fresh round of capital raising of Rs 10,000 crore, for which shareholders’ nod will be sought soon.
The bank also said Canadian investor Erwin Singh Braich's $1.2 billion offer will not be pursued further and hinted that a $500-million offer from Citax Holdings and Citax
Investment Group, which was being favourably considered, is also facing headwinds.
The bank, which was waiting for regulatory nods as Citax's offer entailed over 10 per cent ownership, has not yet been able to get a clearance on the "conditions precedent". Without specifying timelines, it said the Citax offer will be taken up "during the next round". The troubled bank has been forced to shrink its book due to capital paucity and was hoping to close the fundraising by December.
Need for capital has been necessitated as under new CEO Ravneet Gill, the bank has had to provide for sour loan bets taken under his predecessor Rana Kapoor whose term was cut short by the RBI last year over concerns on corporate governance.