YES Bank case: ED summons Anil Ambani, Subhash Chandra and Naresh Goyal

The agency also calls Subhash Chandra, Naresh Goyal, Kapil Wadhawan, and Peter Kerkar in money laundering probe

The Enforcement Directorate (ED) has issued summons to a clutch of borrowers of YES Bank, including Essel group Chairman Subhash Chandra, Jet Airways founder Naresh Goyal, Cox & Kings promoter Peter Kerkar, Dewan Housing Finance promoter Kapil Wadhawan, and a few more in connection with the money laundering probe against YES Bank co-founder Rana Kapoor. Besides, the federal agency has issued fresh summons to Reliance Group Chairman Anil Ambani asking him to appear on Thursday.

Ambani was summoned on Monday for questioning related to the stressed loans that were sanctioned to ADAG group during Kapoor’s tenure. But he has filed adjournment application with the ED seeking more time. An ED official said it was examining all the big borrowers of YES Bank and that is why each of the borrower had been asked to join the probe this week. Sources said ED wanted to deep dive into all the accounts which had defaulted and the loans had turned into bad debts. The agency will record the statement of the management and promoters of all the stressed firms and will make it part of the prosecution complaint, the source said.

Other than the bad debt accounts, the probe agency is verifying the rationale behind Kapoor keeping some of his realty assets on mortgage with some housing finance firms. “These properties that were kept on mortgage were actually the illegal gratification, which Kapoor has received on advancing loans to entities without due diligence and were not in line with the Banking Regulation Act,” an ED official said…

YES Bank AT1 bond write-down reflects distinct treatment for private banks

The bailout scheme requires YES Bank to write down about Rs 8,700 crore ($1.2 billion) of outstanding AT1s

Rating agency Standard and Poor’s on Monday said the decision to write-down YES Bank’s additional tier-1 (AT1) bonds highlights the distinction in India in treatment of instruments issued by public sector banks and those from private banks. This would create losses for asset managers and raise capital costs for issuers. A complete write-down would likely raise the risk premium that investors price into Indian hybrids, said S&P Global Ratings credit analyst Deepali Chhabria.

The bailout scheme requires YES Bank to write down about Rs 8,700 crore ($1.2 billion) of outstanding AT1s. AT1 investors have filed a petition in court against the RBI, YES Bank and the government. Media reports indicate that parties are exploring an out-of-court settlement, with AT1 investors clamoring for conversion of AT1s into equity.

Under the Basel III framework, AT1 instruments are designed to be loss-absorbing tool. The holders of the debt might not get repaid in the event of financial stress. Indian regulations state that such instruments should absorb losses while the bank remains a going concern. RBI’s decision to permanently write down YES Bank’s AT1s was in line with the agency’s view that these instruments will absorb losses at private sector banks, not public sector banks, rating agency said. Indian banks’ AT1s categorically provide that any capital infusion by the government of India into the issuer as the promoter in the normal course of business may not be construed as a point of non-viability trigger. The thinking goes that, since the government owns the bank, it has the right to inject capital into the lender…

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ED probes Rana Kapoor's role in YES Bank's Rs 30,000-cr bad loans

The special court under the Prevention of Money Laundering Act granted an extension to keep Rana Kapoor under custody till March 16

The exceptional court under the Prevention of Money Laundering Act (PMLA) allowed an expansion to the Enforcement Directorate (ED) to keep Rana Kapoor under care till March 16. The ED had looked for expansion of Kapoor’s authority to test his job in YES Bank’s terrible obligations of Rs 30,000 crore. It will likewise investigate whether the monies were “siphoned and washed” to the 78 substances constrained by the bank’s fellow benefactor.

“It has been seen that more than Rs 30,000 crore was given as advances by YES Bank to a few organizations/elements during the residency of Kapoor in YES Bank which have changed over into terrible obligations. Kapoor is required to be grilled to learn if, in the pretense of these credits, the monies have been siphoned and washed,” the ED said in its remand application to court.

The ED included that it was examining credits of over Rs 20,000 crore from the perspective of inconsistencies, renumeration and preoccupation. Examination has uncovered that around 78 organizations claimed by Kapoor’s relatives were being controlled and overseen by Kapoor. The ED stated, “Records identified with these organizations/firms are to be acquired,” and included that Kapoor would be gone up against to discover redirecting of assets from YES Bank to these organizations. The ED named Kapoor, his significant other Bindu and three little girls — Roshini, Radha and Raakhe — as denounced in the issue.

One rupee: The value that foreign brokerages attach to the YES Bank stock

Macquarie Capital Securities also said if State Bank of India (SBI) decided to buy stake in the bank, they should buy it at Rs 1 per share as the net worth is hugely impaired

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Company News: Jp morgan reduces its target fee for yes bank on Thursday to rs 1 consistent with proportion, taking into consideration the potential fall in the lender’s net well worth because of burdened property. Macquarie capital securities also stated if the nation’s financial institution of India (sbi) decided to shop for stake inside the financial institution, they should buy it at rs 1 in keeping with share because the net well worth is highly impaired.

“we consider forced bailout traders will in all likelihood need the bank to be acquired at near-0 fee to account for risks related to the pressure e-book andProbable lack of deposits. we think the financial institution will need to be recapitalised at nominal equity price and could check dilution of additional tier 1 (at1) capital. we continue to be underweight and reduce our goal rate to rs 1 as we consider internet well worth is largely impaired,” jp morgan stated.

Explaining its reasons for the meagre rate for yes bank shares, macquarie stated the bank has a net well worth of rs 25,000 crore. but, its bb and underneath rated loan portfolio is approximately rs 30,000 crore and the bbb beneathBook is sort of rs 50,000 crore. “if we expect giant part of bb and beneath is wiped off, and say 10-15 in step with cent of the bbb ebook is to be written off, it implies the current net worth of the bank is 0 (after factoring in 25 in line with cent of the tax benefits),” it stated. Chartyes financial institution’s shares soared 26 per cent to rs 36.eighty five on thursday after reviews said that sbi-led consortium might purchase a sizeable stake inside the financial institution. but the share price might not keep at modern-day degrees if these brokerages’Projections flip authentic.

YES Bank’s co-founder Rana Kapoor likely to sell his stake to Paytm

According to reports, Kapoor has held preliminary talks with Vijay Shekhar Sharma, founder of One97 Communications

Rana Kapoor, co-founder of YES Bank, is said to be in talks with One97 Communications, owner of Paytm, to sell his stake in the private sector lender. Kapoor and his associate entities owned 10.6 per cent in the bank at the end of June 2019. Around 7.34 per cent of the Kapoor family stake has been pledged with Reliance Nippon Asset Management Company (RNAMC).

According to reports, Kapoor has held preliminary talks with Vijay Shekhar Sharma, founder of One97 Communications. The structure of the deal would depend on the approval from the Reserve Bank of India (RBI), given that Sharma already owns a stake in Paytm Payments Bank, said sources.

Kapoor refused to comment on the development, while Paytm did not respond to Business Standard’s queries. YES Bank said it was a matter related to the promoters. An RNAMC spokesperson said, “Reliance Nippon Life Asset Management has not given any consent and is not in discussion with anyone about YES Bank’s pledged shares.”

YES Bank had been under the regulator’s scanner for its corporate governance practices and the under-reporting of bad loans numbers. Kapoor was denied an extension to continue as MD and CEO by the RBI in November 2018.