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Yes Bank News - Three private banks pare stake in Yes Bank within 2 weeks of investing

Mumbai: After efforts to rescue Yes Bank last month, three private lenders already sold part of their stakes between March 17 and March 31, BSE shareholding data showed - Yes Bank News

The Federal Bank sold the largest number of shares at 5.86 crore, followed by Kotak Mahindra Bank at 4.72 crore and IDFC First Bank at 4.02 crore shares. While the Federal Bank’s stake in Yes Bank  decreased by 47 basis points (bps) to 1.92% as of March 31, Kotak Mahindra Bank stake fell 37 basis points to 3.61% and IDFC First Bank stake fell 32 bps to 1.67% 17-31 March, the data showed 

Yes Bank News

Other lenders such as State Bank of India (SBI), Axis Bank, Bandhan Bank, and Housing Development Finance Corp. HDFC have not sold any shares and therefore they have not seen any change in their stake. However, ICICI Bank bought an additional 78,300 shares after March 17, although its stake remained unchanged at 7.97%.

On March 13, the government approved a rescue plan for Yes Bank backed by SBI according to Yes Bank News. Under the plan, domestic investors including SBI, Housing Development Finance, ICICI Bank, Kotak Mahindra Bank, Bandhan Bank, Federal Bank, and IDFC First invested Rs. ₹10,000 crores in Yes Bank.

Rajnish Kumar, chairman of SBI, the largest investor in Yes Bank, had said at a press conference on March 17 that SBI was still committed to invest and would not sell any part of its 48% stake before the expiry of a three-year partial lock-in period. The lock-in period was part of the rescue efforts to ensure that Yes Bank continued well-capitalized. Kumar also said that the SBI could invest again in the second round of financing that is expected to take place in six months.

"I am free to sell shares," Kumar said. "Let me assure you that not one share will be sold for three years. But for any bank who has invested, everybody is expecting decent IRR (internal rate of return),"

Sure, lenders have a three-year lock on only 75% of their stakes, and at the same time, they're not barred from selling the rest. Shares of Yes Bank on BSE closed at ₹29.6 on Wednesday, down 0.5% from its previous close.

PC: IndiaTV News,Fortune India

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