Yes Bank to Evaluate Fundraising via Debt Securities on August 23, 2024

YES Bank, the 5th largest private sector bank in India, headquartered in Mumbai caters to retail customers, MSMEs, and corporate clients. Its network is spread across 300 districts of India and comprises 1,198 branches. Among the bank’s major shareholders are the State Bank of India, the country’s largest scheduled commercial bank; and two global investors viz affiliate of Carlyle and Advent International, among others. On June 25, the company held its Board of Directors’ meeting to consider a resolution enabling the bank to borrow or raise funds through the issuance of debt securities. The bank had made this announcement on June 20. 

The outcome:

The Board of Directors, in the meeting on the 25th, approved the borrowing/ raising of funds by the issue of debt securities. The bank, now, plans to raise funds in Indian/ foreign currency through the issue. The options could be non-convertible debentures (NCDs), bonds, or Medium Term Note (MTN) among others. The meeting also included the plan to draft a special resolution for fundraising for its next Annual General meeting on 23 August.

YES Bank’s financial performance:

YES Bank recorded a net profit of Rs.454 Crore, up 124.3%YoY from Rs.202.4 Crore. The lender’s net interest income increased by 2.3%YoY to Rs.2,153.1 Crore from Rs.2,105.2 Crore in the fourth quarter of FY23. The bank’s gross non-performing assets decreased by 11% to Rs.3,982 Crore in the March quarter, from ₹4,457.4 Crore in Q4FY23. The gross NPA percentage for the fourth quarter was estimated to be 1.7%, compared to 2% in the December quarter. In Q4FY24, net NPAs decreased by 31.4% to ₹1,329.7 Crore from ₹1,934.4 Crore in Q3. Its net NPA% was 0.60%, down from 0.9% the previous quarter, indicating that asset quality metrics have improved.

Conclusion: With a successful Annual General Meeting YES Bank has set expansion plans into motion by borrowing debt securities.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.