YES Bank is coming with a further public offer (FPO) of around Rs 15,000 crore to raise additional equity from the public and improve its capital adequacy. The FPO will open on July 15, 2020, and end on July 17, 2020.
As per lender's red herring prospectus dated (RHP), the shares can be bid in lots of 1,000 equity shares and in multiples thereafter.
The private sector lender said it has filed a red herring prospectus after receiving approval from the capital-raising committee (CRC) of the further public offer (FPO), a process by which a listed company raises fresh capital by issuing new equity shares to the public.
"The bank has filed a red herring prospectus (RHP) dated July 7, 2020, in connection with the offer, with the Registrar of Companies, Maharashtra at Mumbai," YES Bank said in a regulatory filing.
The board of the private lender on July 10 approved the floor price of its FPO at Rs 12 per equity share and a cap of Rs 13 per equity. The set floor price is almost 50% lower than the current market price of the private lender.
The bank has reserved a portion of up to Rs 200 crore for employees in the forthcoming FPO, where a discount of Rs 1 per equity share will be given to the eligible employees.
The private lender has kept a retail portion for investment at a minimum of 35% of the offer size, while a minimum of 15% of shares has been reserved for non-institutional investors. Qualified institutional buyers (QIB) portion for investment has been kept at 50% of the total issue size.
With regard to the upcoming FPO, the Capital Raising Committee (CRC) of the Board of Directors of YES Bank will meet on July 14 for the allocation of equity shares to successful anchor investors pursuant to the offer and for determination of the anchor investor allocation price.
"CRC meet is scheduled to be held on July 14, 2020, for the purposes of allocation of equity shares to the successful anchor investors and for determination of the anchor investor allocation price," YES Bank said in its regulatory filing submitted today.
In another update, State Bank of India's central board has approved investment of up to Rs 1,760 crore in YES Bank's FPO.
YES Bank is currently in the market to raise Rs 15,000 crore for meeting the capital requirement. The bank needs capital to support growth, expansion, meeting regulatory ratios like capital adequacy and provisioning for bad loans. Experts suggest that spurt in NPAs and consequent provisioning has led to YES Bank breaching the capital adequacy requirements, as mandated by the apex lender Reserve Bank of India.
Investment bankers advising YES Bank on the FPO include Axis Capital, Kotak Mahindra Capital, Citi, and Bank of America.
Shares of YES Bank today opened with a loss of 15.29% and later fell 16.86% to an intraday low of Rs 21.2 against the previous close of Rs 25.50 on BSE. The stock price of private lender ended at Rs 22.10 on BSE today, falling Rs 3.40 or 13.33%.