State Bank of India (SBI) on Wednesday said that it may invest in the follow-on public offer (FPO) by YES Bank. The executive committee of the central board (ECCB) of the state-run lender has approved a maximum investment of up to Rs 1,760 crore in the YES Bank FPO, SBI said in an exchange filing.
On Tuesday, YES Bank announced that its capital raising committee (CRC) of the board of directors had approved raising funds by way of a FPO. "The Capital Raising Committee of the Board of Directors of the Bank ("CRC"), at its meeting held earlier today i.e., July 7, 2020, has approved raising funds by way of a further public offering," YES Bank said in a statement. The private sector lender, which has a market cap of Rs 32,317 crore, will soon file FPO documents with the market regulator SEBI and registrar of companies before offering shares via a public offer.
Earlier this year the Reserve Bank of India (RBI) had taken control of YES Bank, after the bad debt laden lender had failed to raise the capital it needed to stay above mandated regulatory requirements. The RBI kickstarted the reconstruction scheme for the lender, following which eight private financial institutions, including SBI, ICICI Bank, HDFC, acquired stakes in YES Bank as part of the reconstruction scheme.
Meanwhile, YES Bank posted a standalone net loss of Rs 16,418.02 crore for the financial year ending March 31, 2020. The private lender had reported a profit of Rs 1,720.27 crore at the end of financial year 2018-19.Also read: Petrol prices remain unchanged for 9th consecutive day; diesel prices see pause