- Finance minister Nirmala Sitharaman has asked the Reserve Bank of India (RBI) to identify the people who played a role in creating the
Yes Bank crisis . - She has also asked the RBI to assess the adequacy of regulatory and supervisory norms in India.
- Sitharaman wants the crisis to be resolved under due process of law, but with a sense of urgency.
Within a day after superseding Yes Bank’s board, the Reserve Bank of India (RBI) released a new scheme for the reconstructed bank. As per the RBI draft, the altered capital of Yes Bank stands at
The Reserve Bank of India (RBI) released its new scheme for the reconstruction of Yes Bank. The plan alters Yes Bank’s capital to ₹5,000 crore and also said that a strategic investor will bring in 49% equity into it.
As per the banking regulator, the strategic investor which could be the State Bank of India (SBI) and the Life Insurance Corporation (LIC), will not reduce holding below 26% before three years. In addition, Finance Minister Nirmala Sitharaman also provided assurance to depositors and employees, in a press conference.
“Deposits and liabilities will continue unaffected as before. Employment and salary assured, at least for one year,” she said.
FM asks RBI to ‘identify the role played by individuals’
Sitharaman also asked the RBI to find out which individuals are responsible for the Yes Bank’s troubles.
“I’ve asked the RBI to go into assessing what has caused these difficulties for Yes Bank. Clearly identify the role played by individuals in creating the problem and not-so-comprehensively addressing the problem,” she told reporters at a press conference in Delhi after recapping the timeline of events that led to the private bank’s financial crisis.
The RBI issued a moratorium last night capping withdrawals from Yes Bank at ₹50,000 for the coming month, which was a long time coming, according to Sitharaman. India’s top bank has reportedly been monitoring the activities of Yes Bank since 2017.
In addition to finding the perpetrators, Sitharaman has also asked the RBI to analyse India’s current regulatory norms for loopholes.
“I’ve also asked the RBI to tell me about the adequacy of the extent of the regulatory norms, supervisory norms. If found inadequate — where and why? I’ve asked them for a report on this,” she said.
Assuring depositors’ that their interest is “completely safeguarded”, the finance minister said that the RBI will be addressing the problem as quickly as possible.
“I want the RBI to ensure that the due process of law is set to roll with a sense of urgency so that we can find out who led to this problem of this size of magnitude in the Yes Bank,” she said.
See also:
India's largest bank stock sees the sharpest fall in over 7 years — investors want to say 'no' to Yes Bank
RBI has a new 'scheme' to rescue Yes Bank — will be released shortly, says Shaktikanta Das
Yes Bank mobile and net banking down after RBI limits withdrawals to ₹50,000