Skip to content
Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Primary Menu Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us
  • Featured

Panicked Yes Bank Patrons Rush To Withdraw Funds

Mar 6, 2020 | Pratirodh Bureau

FILE PHOTO: A security guard stands outside a Yes Bank branch at its headquarters in Mumbai on January 17, 2018

Shares in Yes Bank Ltd plunged 60% on Friday as panicky depositors rushed to withdraw funds after the central bank took control in a dramatic late-night move and limited withdrawals from the troubled lender.

The shock move by the Reserve Bank of India (RBI) followed months of steady deterioration in the financial position of the country’s fifth-largest private lender and growing concerns over governance.

Shares of Yes Bank plunged as much as 85% to wipe out more than $1 billion of market value, marking the biggest intra-day fall in an Indian blue-chip stock. By early afternoon, the stock was down 60% after paring losses.

As thousands of customers rushed to pull out funds and tempers flared at overcrowded branches nationwide, police deployed in some states to help control the crowds.

Many business owners feared the central bank’s move would hit their operations too, as the lender, with 1,000 branches across India, has many commercial clients.

“I will struggle to pay salaries to my staff, or pay any of my vendors, because of the restrictions,” said Chintan Patel, a building contractor in Ahmedabad.

Many customers took to social media to complain that the bank’s online system was down, preventing fund transfers, while payment apps, such as PhonePe, which use Yes Bank to help process transactions, were also affected.

“Effectively, Yes Bank should have no equity value left,” said Sandip Sabharwal, a Mumbai-based fund manager. “Ideally, trading should be suspended till formal restructuring is announced.”

The rout of Yes Bank sent the broader market and the banking index into a tailspin.

As global markets reeled from uncertainty over a coronavirus outbreak, the debacle sent the NSE Nifty 50 tumbling as much as 3.9% to its lowest since last September. The Nifty Bank Index was down 4.65% by 0630 GMT.

RESCUE PLAN

The RBI placed Yes Bank under a moratorium on Thursday, and said it would swiftly work on a revival plan.

In a note, rating agency Moody’s said the moratorium was credit negative as it affected timely repayment of depositors and creditors. It said the lack of coordinated action underlined continued uncertainty over bank resolution processes in India.

“It will be done very swiftly, it will be done very fast,” RBI Governor Shaktikanta Das said at an event in Mumbai, responding to a query about the rescue plan for the bank.

“Let me assure you that the Indian banking sector continues to be sound and safe,” Das said on Friday. “We stand committed to maintain stability in the financial and banking sector.”

In a regulatory filing on Thursday, State Bank of India, the largest state-run lender, said its board had given in-principle approval to explore an investment in Yes Bank.

SBI shares tumbled as much as 12% on Friday, in its biggest intra-day drop since October 2012.

“(RBI’s move) was inevitable, and was in the offing for some time,” said Deepak Jasani, an analyst at HDFC Securities.

“The collateral damage it will have on the equity markets and debt investors is something that we have to be worried about in the near-term.”

Yes Bank, struggling under a huge pile of bad debt, has battled for months to raise the capital it needs to stay above regulatory requirements.

Since late last year, it had been trying to raise $2 billion in fresh capital, and in February delayed its December-quarter results.

“We believe forced bailout investors will likely want the bank to be acquired at near zero value to account for risks associated with the stress book and likely loss of deposits,” JPMorgan analyst Saurabh Kumar said in a note.

JPMorgan cut its price target on Yes Bank to 1 rupee, from 55 rupees ($0.7468) a share.

Tags: Global markets, HDFC Securities, JPMorgan, Nifty Bank Index, PhonePe, Pratirodh, RBI, RBI Governor Shaktikanta Das, Reserve Bank of India, SBI, State Bank of India, yes bank

Continue Reading

Previous WHO Urges World To Take Covid-19 More Seriously
Next Covid-19 Fears: Players Skip All England Badminton

More Stories

  • Featured

Farmers Allege Conspiracy To Kill 4 Of Them During Tractor Rally

2 days ago Pratirodh Bureau
  • Featured

Tree Planting Efforts Push Out Pastoralists In The Himalayas

2 days ago Pratirodh Bureau
  • Featured

A Year After Wuhan Lockdown, A World Still Deep In Crisis

2 days ago Pratirodh Bureau

Recent Posts

  • Farmers Allege Conspiracy To Kill 4 Of Them During Tractor Rally
  • Tree Planting Efforts Push Out Pastoralists In The Himalayas
  • A Year After Wuhan Lockdown, A World Still Deep In Crisis
  • Farmers To Step Up Protests After Rejecting Govt Offer
  • Farm Laws: Govt Offers Suspension, Farmers Want Repeal
  • BJP Members Amplify False Claim About Microchip In Vaccine
  • India’s Vac Diplomacy In South Asia Pushes Back Against China
  • ‘Your Land’? Native Americans Question Inaugural Song
  • 5 Killed In Blaze At Serum Institute Of India
  • Nepal To Turn Everest Trash Into Art To Highlight Garbage Blight
  • Biden Rolls Back Trump Policies On Health, Climate, Wall, Muslims
  • Govt Offers To Suspend Implementation Of Farm Laws
  • Massive Security Phalanx In Place To Shield Biden Inauguration
  • A Lotus, Not A Chinese Dragon: Gujarat Changes Name Of Fruit
  • “We’ve Got A Lot Of Work To Do. It’s Not Going To Be Easy”
  • Govt. Urges Frontline Workers Not To Refuse Vax As Targets Missed
  • Estonian Firm Seeks Finance From Forests
  • China, WHO Could Have Acted More Quickly: Probe Panel
  • ‘Advisable To Not Take Vaccine If’: Covaxin Factsheet
  • Opp Seeks Probe Into Security Leak After Goswami’s Messages Emerge

Search

Main Links

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us

Related Stroy

  • Featured

Farmers Allege Conspiracy To Kill 4 Of Them During Tractor Rally

2 days ago Pratirodh Bureau
  • Featured

Tree Planting Efforts Push Out Pastoralists In The Himalayas

2 days ago Pratirodh Bureau
  • Featured

A Year After Wuhan Lockdown, A World Still Deep In Crisis

2 days ago Pratirodh Bureau
  • Featured

Farmers To Step Up Protests After Rejecting Govt Offer

2 days ago Pratirodh Bureau
  • Featured

Farm Laws: Govt Offers Suspension, Farmers Want Repeal

3 days ago Pratirodh Bureau

Recent Posts

  • Farmers Allege Conspiracy To Kill 4 Of Them During Tractor Rally
  • Tree Planting Efforts Push Out Pastoralists In The Himalayas
  • A Year After Wuhan Lockdown, A World Still Deep In Crisis
  • Farmers To Step Up Protests After Rejecting Govt Offer
  • Farm Laws: Govt Offers Suspension, Farmers Want Repeal
Copyright © All rights reserved. | CoverNews by AF themes.