Yes Bank seeks to blame ri­val KMB for bad press

Financial Chronicle - - PLAN, POLICY - BLOOMBERG

SEARCH the in­ter­net for Yes Bank and you’d have to look hard to find a pos­i­tive story. Reg­u­la­tory trou­ble, di­rec­tor res­ig­na­tions and stock price un­der pres­sure.

While none of those events are imag­i­nary, the bank would rather shift the blame to a ri­val.

Yes Bank has ac­cused fi­nan­cial news­pa­per Busi­ness Stan­dard of pub­lish­ing ma­li­cious and defam­a­tory news re­ports, sug­gest­ing this was done at the be­hest of Uday Ko­tak, owner of the news­pa­per and ri­val Ko­tak Mahin­dra Bank Ltd.

In a fil­ing with the stock ex­changes, Yes Bank en­closed a let­ter ad­dressed to se­nior ed­i­tors at Busi­ness Stan­dard ac­cus­ing the news­pa­per of “a per­sis­tent at­tack on a pub­lic trust in­sti­tu­tion like Yes Bank Ltd., which is go­ing through a tran­si­tion phase in its life cy­cle”.

The bank has la­belled the “con­tin­u­ous nega­tive pro­pa­ganda” as an “at­tempt to desta­bilise” it and “un­der­mine the con­fi­dence of the stake­hold­ers in the bank”.

The bank has la­belled the “con­tin­u­ous nega­tive pro­pa­ganda” as an “at­tempt to desta­bilise” it and “un­der­mine the con­fi­dence of the stake­hold­ers in the bank”.

Ko­tak Mahin­dra Bank and its sub­sidiaries hold about 2,000 shares in Busi­ness Stan­dard Ltd., which is less than 0.0013 per­cent of its cap­i­tal, said Ro­hit Rao, chief com­mu­ni­ca­tion of­fi­cer at the Ko­tak Mahin­dra Group.

Cu­ri­ously, of the 13 sto­ries listed in the let­ter as hav­ing caused this al­leged of­fence, three are syn­di­cated from news agen­cies and a quick check on the re­main­ing shows they are news re­ports cov­er­ing stock price move­ments or im­por­tant board-re­lated de­vel­op­ments. One is an opin­ion col­umn on the lead­er­ship changes in the bank­ing in­dus­try and an­other is on al­le­ga­tions of GST eva­sion, which Yes Bank has com­mented on in the story.

The sto­ries are spread over Septem­ber, Oc­to­ber, Novem­ber—that’s say four sto­ries a month — which does not sug­gest any un­usual vol­ume ei­ther. Yes Bank has been in the news for weeks now as its founder Rana Kapoor was de­nied a term ex­ten­sion as man­ag­ing di­rec­tor and chief ex­ec­u­tive of­fi­cer by the cen­tral bank.

The bank also wit­nessed the res­ig­na­tion of three in­de­pen­dent di­rec­tors, one of whom served as board chair­man. Among them one di­rec­tor raised gover­nance is­sues in a com­ment to Bloomberg.

One of the two ex­ter­nal mem­bers ap­pointed to a search com­mit­tee, tasked with find­ing Kapoor’s suc­ces­sor, also quit mid-way through the process. The other has now been ap­pointed as in­de­pen­dent di­rec­tor.

Most of the Busi­ness Stan­dard sto­ries listed by Yes Bank in its com­plaint are rou­tine news cov­er­age of these de­vel­op­ments. Mak­ing it un­clear why the bank is pass­ing the buck.

The bank has la­belled the “con­tin­u­ous nega­tive pro­pa­ganda” as an “at­tempt to desta­bilise” it and “un­der­mine the con­fi­dence of the stake­hold­ers in the bank”

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