The government on March 13 approved the reconstruction scheme drawn by the Reserve Bank of India's (RBI) for Yes Bank. Yes Bank was placed under a moratorium earlier this month by the RBI, which took control of the board and also imposed a Rs 50,000-limit on withdrawals from the bank till April 3, sending thousands of depositors scurrying to retrieve their money.
Union Finance Minister Nirmala Sitharaman said the moratorium on the bank will be lifted within 3 days of the notification and a new board, having at least 2 directors of SBI, will take over within 7 days of the issuance of notification.
The RBI-appointed administrator, former SBI chief financial officer Prashant Kumar, will vacate the office seven days after the moratorium is lifted, Sitharaman said at a media briefing.
Sitharaman said that State Bank of India (SBI) will invest 49 percent of equity in Yes Bank, with other investors also being invited.
The SBI will have a lock-in of three years for up to only 26 percent of the 49 percent of its stake in Yes Bank. For the rest of the investors, the three-year lock-in will be applicable for 75 percent of their investment, Sitharaman said.
On Thursday, SBI announced a Rs 7,250-crore fund infusion into the crippled Yes Bank under which it will pick up to 49 percent equity in the fourth largest private sector lender.
The fund infusion is part of the Reserve Bank-mandated rescue plan.
(With inputs from agencies)
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