State Bank of India (SBI) could lower its stake in YES Bank after a lock-in period ends on March 13, news agency Reuters reported earlier this month quoting two sources.
YES Bank shares plunged almost 13 per cent on Monday as an RBI-mandated lock-in on SBI’s stake in the private sector lender ended. The bank could lower its stake in YES Bank after a lock-in period ends on March 13, news agency Reuters reported earlier this month quoting two sources.
YES Bank shares nosedived almost 13 per cent on Monday, as an RBI-mandated lock-in on SBI’s stake in the private sector lender ended. YES Bank shares fell by as much as Rs 2.1 to Rs 14.4 apiece on BSE in intraday trade.
SBI could lower its stake in YES Bank after a lock-in period ends on March 13, news agency Reuters reported earlier this month quoting two sources.
Till March 2023, we are required to hold a 26 per cent stake in Yes Bank. If it all, our stake comes within 26 per cent till March 2023, I am quite okay with that. Beyond that, we’ve not thought at the board level. So, I am unable to comment on anything relating to our further course of action,” SBI Chairman Dinesh Khara had told analysts on an earnings call earlier.
In March 2020, SBI acquired a 49 per cent stake in Yes Bank under a restructuring plan laid out by the RBI. The RBI also put in place a lock-in on SBI which prevented it from reducing its stake below 26 per cent before the completion of three years. Lenders such as ICICI Bank, Axis Bank, IDFC First, and HDFC stepped in to rescue Yes Bank when its balance sheet turned bad. Today these four companies hold 2.61 per cent, 1.57 per cent, one per cent and 4.34 per cent in YES Bank respectively
Besides, SBI AMC holds 23.67 million of YES Bank shares in its Nifty50 ETF, Kotak AMC holds 11.99 million, Nippon India has 10.56 million, SBI ETF of Bank Nifty 6.72 million and UTI AMC 5.89 million.
Under the reconstruction scheme, the RBI imposed a lock-in period for all investors, with SBI required to hold at least 26 per cent in the troubled lender till March 2023.
Many analysts expect YES Bank to stay under pressure going forward.
“There is going to be a lot of selling pressure in the coming months,” said Ashutosh Mishra of Ashika Broking.
In the last three years, YES Bank shares have lost nearly 35 per cent of their value on the bourses, a period in which the Nifty50 has soared 73 per cent.
