Mumbai:
Bloomberg News has reported that the government has approved a plan for State Bank of India(SBI) to lead a consortium including Life Insurance Corporation(LIC)that will buy a stake to rescue the capital-starved Yes Bank.
As per reports, SBI would soon start the process to identify other members of the consortium before a bid is made to take over the ailing bank.
The announcement is expected soon, the people told Bloomberg, asking not to be identified as the information isn’t public.
Earlier in January, the chairman of the bank had expressed his strong belief that “some solutions will emerge” to bail out the private lender.
SBI, while neither denying nor confirming the news report, told stock exchanges that it will abide by the timelines under SEBI disclosure regulations in disclosing the developments, if any in the matter to Stock Exchanges.
Yes Bank, however, informed stock exchanges that it has not received any information on the plan yet.
“In the said matter, we would like to clarify that as on date, the bank has not received any such communication from RBI or any other the government or regulatory authorities or from the SBI and we are unaware of any such decision,” the statement said. “Therefore, we are not in a position to comment.''
YES Bank has struggled to raise capital it desperately needs to stay above regulatory requirements as it battles high levels of bad loans due to its exposure to troubled sectors. The lender has been trying to raise $2 billion in fresh capital for two quarters.
The fourth-largest private lender had earlier said it has delayed its third-quarter earnings as the bank is reviewing non-binding expressions of interest from four investors.
In a filing to the BSE earlier, the bank has said it received non-binding expressions of interest (EoIs) from several investors including J.C. Flowers & Co, Tilden Park Capital Management, OHA (UK) LLP (part of Oak Hill Advisors), and Silver Point Capital.
Earlier in January, the chairman of the bank had expressed his strong belief that “some solutions will emerge” to bail out the private lender.YES Bank has so far failed to bring a strategic investor. Reports recently suggested that the private bank had approached mutual funds for raising fresh equity capital worth $300-$500 million.