YES Bank share price fell 84.93% to an all-time low on NSE today, trading as the top loser on Friday after Reserve Bank of India (RBI) superseded the private lender's board and restricted withdrawals for the customers. RBI later plans to put in place a revival scheme for the private lender.
The announcement came hours after YES Bank was placed under a moratorium, with the RBI capping deposit withdrawals at Rs 50,000 per account till April 3 and superseding its board.
"The matter in regard to Yes Bank was discussed at the meeting of the central board of bank on Thursday and an in-principle approval has been given by the board to explore investment opportunity in the bank," the SBI board informed the bourses late in the evening.
Following the update, the share of the private lender opened at Rs 33.20, nearly 10% lower and further fell 85% to hit a low Rs 5.55 on BSE today, with 2 crore sellers offering the stock.
On NSE, the stock trades 85% lower at Rs 5.65 at its new low, with 22 crore sellers offering the stock. There are only sellers offering and no buyers bidding on YES Bank's shares.
The shares of the private lender have eroded almost 52% value in the last week, 75.94% in one month and 80% since the beginning of 2020. YES Bank shares have declined 96% in one year.
Lender's market capitalisation fell to Rs 2,711 crore.
Further rating firms JP Morgan 'Underweight' rating YES Bank share and cut its target price to Re 1 as the research firm believes that lender's net worth will be largely impaired post the bailout from SBI. Prior to this, JP Morgan had given a target price of Rs 55.
Further, Macquarie Capital Securities has also passed a similar rating to the private lender and said that State Bank of India and other PSU banks need not pay more than Re 1 for the lender's share as its net worth is zero and there is lack of clarity on the bank's deposit franchise due to the solvency issues.
Reports also suggested that SBI and LIC are to collectively pick up a 49 per cent stake in the private lender at a share value of Rs 2.
Former State Bank of India CFO Prashant Kumar has been appointed the administrator.
Santosh Meena, Senior Analyst at Tradingbells said, "YES Bank fiasco comes as an out of syllabus question for the market amid ongoing worries of coronavirus. The market took YES Bank event very negatively because it raises a question on the stability of the overall Indian financial system. The market is facing a double whammy situation where global markets are struggling on the back of coronavirus worries and YES Bank fiasco is a setback event on the domestic level. There is a need for some clarity on both domestic and global front for the market to witness any pullback otherwise the pain will continue."
As a depositor in YES bank, one should not panic as the depositor's money is safe but as a shareholder, there is no value left for them and it is better to exit whatever price they get where no one should try to buy this stock as a fresh investment."