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YES Bank's new management: Prashant Kumar appointed MD, CEO; Sunil Mehta Non-Executive Chairman

RBI may also appoint one or more persons as additional directors; all members of the board, except additional directors, will be appointed for a period of one year or until an alternate board is reconstituted

twitter-logoBusinessToday.In | March 15, 2020 | Updated 10:21 IST
YES Bank's new management: Prashant Kumar appointed MD, CEO; Sunil Mehta Non-Executive Chairman
The Rs 50,000 cap on cash withdrawal will be removed on Wednesday

Seven days after the RBI superseded YES Bank board, the government, notifying the YES Bank Reconstruction Scheme 2020, dissolved the office of administrator, appointing new board members of the private lender. While notifying the YES Bank reconstruction scheme, the Centre has said the new board of directors will be led by Prashant Kumar, former chief financial officer and deputy managing director of State Bank of India. He has also been appointed as Chief Executive and Managing Director of the private lender. Kumar was earlier appointed as the YES Bank administrator.

Sunil Mehta, former non-executive chairman of Punjab National Bank, has been appointed as non-executive chairman of YES Bank. Mahesh Krishnamurthy will serve as a non-executive director of the bank, while Atul Bheda as a non-executive director. The investor bank, State Bank of India, will nominate two officers as directors.

Also read: YES Bank was on the verge of going belly up; here's what Q3 results reveal

The RBI may also appoint one or more persons as additional directors. "Any investor who is permitted to have the voting right of fifteen per cent shall have the right to nominate one director on the board," says the government notification.

All members of the board, except additional directors, will be appointed for a period of one year or until an alternate board is reconstituted. "Any defect in the constitution or any vacancy in the board shall not invalidate any meetings conducted by the board," the statement said. It also added that investor bank and other investors would be treated as "public shareholders" of the reconstituted bank for five years from the date of allotment of shares.

As per the notification, the Rs 50,000 cap on cash withdrawal will be removed in 'three working days' from the start of the scheme (Wednesday next week). The lead investor in the bank, State Bank of India, has already announced to infuse Rs 7,250 crore in it, while other private lenders including ICICI Bank, Axis Bank and Kotak Mahindra Bank have also been roped in to revive the cash-strapped lender.

Also, the reconstruction scheme says all YES Bank employees have been guaranteed at least a year-long continuation of employment. All YES Bank branches will continue to function as usual.

YES Bank, in its December quarter result released on Saturday, reported worst ever loss of Rs 18,564 crore due to provisions and contingencies of Rs 24,567 crore. The bank reported a profit of Rs 1,001 crore in Q3 FY19.

Also read: Yes Bank Q3 net loss spikes to Rs 18,564 cr, its worst ever

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