YES Bank Revival Plan

Here are the full details about the RBI's revival plan for the crisis-hit Yes Bank:

Ø  RBI says that State Bank of India (SBI) has expressed its willingness to make investment in Yes Bank and participate in its reconstruction scheme.

Ø  All employees of the reconstructed Yes Bank will continue with the same pay for at least one year.

Ø  RBI plans to alter the authorised capital for the reconstituted bank to Rs 5,000 crore and number of equity shares will also be altered to 24,000 crore of Rs 2 each aggregating to Rs 48,000 crore.

Ø  It has been proposed that the investor bank will not reduce its holding in the new bank below 26 per cent before completion of three years from the date of infusion of the capital.

Ø  The investor bank shall agree to invest in the equity of the reconstructed bank to the extent that post infusion it holds 49 per cent shareholding in the bank at a price not less than Rs 10 (Face value of Rs 2 and premium of Rs 8).

Ø  A new board will be constituted.

Ø  The plan proposes that Board of Directors of the Reconstructed Bank will have the freedom to discontinue the services of the Key Managerial Personnel (KMPs) at any point of time after following the due procedure.

Ø  The investor bank shall have two nominee directors on the Board of the Reconstructed Bank.

Ø  RBI may appoint additional directors. It will be open to the Board of directors of Yes Bank to co-opt more directors to it.

Ø  It will be open to the reconstructed bank to open new offices and branches or close down existing offices or branches, in accordance with the extant policy of the Reserve Bank and complying with the necessary terms and conditions