Rating agency Moody’s has placed private sector lender Yes Bank’s rating under review for a possible downgrade following weak financial performance for the July-September quarter.
Moody’s said the bank’s weakening financial position can be somewhat offset by the planned raising of capital. Nevertheless, Moody’s notes that there are significant execution risks around the timing, price and regulatory approvals required. “During the review period, Moody’s will focus on the bank’s ability to raise new equity capital,” the rating agency said.
The private sector lender said it had received a binding offer from a financial investor to invest up to $1.2 billion via new equity capital and that the offer was valid till November 30.
“An inability to raise the planned equity capital will negatively impact Yes Bank’s credit profile and ratings,” Moody’s said.
