BE/RBINOTE/12/2020
- The board of Yes Bank has been superseded with immediate effect says a release of Reserve Bank of India
- The current development comes six months after the regulator did the same with the city-based cooperative lender PMC Bank after a large scam was unearthed
- The Reserve Bank on 5th March 2020 imposed a moratorium on the capital-starved Yes Bank and capped withdrawals at ₹50,000 per account till further orders.
- The board of Yes Bank has also been superseded with immediate effect, the Reserve Bank of India (RBI) said in a late evening statement.
- Former SBI CFO Prashant Kumar has been appointed as administrator for Yes Bank.
- The latest development comes six months after the regulator did the same with the city-based cooperative lender PMC Bank after a large scam was unearthed.
- Yes Bank has been grappling with mounting bad loans.
- Earlier in the day, sources said SBI along with some other financial institutions would bail out Yes Bank, with the government giving the go-ahead.
- However, the depositors will be allowed to withdraw more than ₹50,000 under the following conditions:
- In connection with the medical treatment of the depositor or any person actually dependent on him.
- Towards the cost of higher education of the depositor or any person actually dependent on him for education in India or outside India.
- To pay obligatory expenses in connection with marriage or other ceremonies of the depositor or his children or of any other person actually dependent upon him.
- In connection with any other unavoidable emergency. Defending the timing of Yes Bank’s moratorium, Reserve Bank of India governor Shakti anta Das on Friday assured swift resolution to the issues concerning the beleaguered lender.
- Also the Governor added “that our banking sector continues to be sound and safe and said that RBI was ready to effectively deal with the challenge ahead.
- The Governor also said that RBI stands committed to maintaining stability of financial and banking sector.
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