Following reconciliation between the groups of the two promoters of Yes Bank, Rana Kapoor and Madhu Kapur, the Reserve Bank is now likely to ask the private sector lender to bring down promoter shareholding to 15%.
At present, Rana Kapoor, the co-founder and former MD & CEO of Yes Bank, has about 10.68% stake, while the Madhu Kapur group has 9.18%, as reported for the quarter ended March 2019.
According to central banking sources, the regulator internally discussed the need to reduce promoter shareholding in line with other private sector banks, after both the groups, engaged in a legal battle for a few years, decided to patch up in April this year.
After promoters buried the hatchet, Shagun Kapur Gogia was appointed to the board of Yes Bank on behalf of her mother Madhu Kapur, who inherited promoter holding from her late husband Ashok Kapur, the other co-founder of Yes Bank.
Sources said the RBI is likely to ask Yes Bank to provide a roadmap or a timeline for reducing promoters’ stake to 15%. RBI has been strict in recent times with regard to promoter shareholding and expects banks to adhere to norms.
Bandhan, Kotak banks
RBI had barred Bandhan Bank from opening branches after not adhering to promoter shareholding norms, while another private lender Kotak Mahindra Bank was fined ₹2 crore by RBI for not complying with the directions regarding dilution of promoters’ shareholding in the company. Yes Bank has been under RBI’s watch in recent years. MD & CEO Rana Kapoor was denied an extension till 2021, despite the endorsement of the board.
Instead, he got an extension till January 2019 after his term ended in August 2018. After Mr. Kapoor’s term was over, Ravneet Gill was appointed as the MD & CEO. Yes Bank is planning to raise $1.2 billion capital over the next 12-18 months, in two equal tranches, to fund its growth plans, which may also see promoter shareholding diluted to some extent.
An email query sent to Yes Bank on preparing a roadmap for reducing promoter stake remained unanswered till the time of going to press.
