|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||46.00 - 52.70|
|52 Week Range||29.00 - 286.00|
|Beta (3Y Monthly)||2.00|
|PE Ratio (TTM)||22.23|
|Earnings Date||Nov 1, 2019|
|Forward Dividend & Yield||2.00 (4.87%)|
|1y Target Est||282.14|
Indian private sector lender Yes Bank is in talks with Microsoft Corp and two other technology companies as it looks to bring in a strategic shareholder as part of a strategy to rake in fresh capital, the Mint newspaper reported on Sunday. The talks began three weeks ago and could see the bank selling as much as 15% through a fresh equity issue, the newspaper reported https://bit.ly/2Mi7vk6, citing two people aware of the discussions. The bank's chief executive officer, Ravneet Gill, had said last week that the lender was in talks with private equity firms, strategic investors and family offices to raise additional capital.
(Bloomberg) -- Ashish Shah is caught in the middle of India’s latest financial crisis. As chief operating officer of Radius Developers, he’s struggling to fund construction of apartment complexes because of a liquidity crunch in the nation’s bloated shadow-banking sector.“Real estate is a sitting duck,” said Shah. “The timing is very crucial as the slowdown has hit the real estate market quite hard. The industry can’t service interest, new interest, additional interest, because there is no cash flow.”Radius and hundreds of other developers relied on loans from what India calls non-banking financial companies (NBFCs) to fuel a five-year property boom. That came to a halt a year ago with the default of one of the shadow banking sector’s leading lenders, Infrastructure Leasing & Financial Services Ltd. The resulting credit squeeze has left builders such as Radius and Omkar Realtors & Developers Pvt. looking for support, or, like scandal-hit Housing Development & Infrastructure Ltd., filing for bankruptcy.There are $63 billion of stalled residential projects across the country, according to Anarock Property Consultants, and their developers have become locked in a downward spiral with shadow banks. As lenders stop new credit, builders are forced to offload properties. Prices fall, causing more real estate loans to turn sour, pushing more shadow banks toward default.In turn, that has cast a shadow on traditional banks and dried up funding to other businesses, putting more stress on an already slowing economy.For Radius, the crunch started when one of its main lenders, Dewan Housing Finance Corp., shut off new loans as it attempts to restructure some $12.7 billion debt to avoid bankruptcy. Shah said he gained a temporary reprieve by selling a project to Blackstone Group Inc., but like all builders, his company needs cash to operate while projects are being built.Edelweiss Financial Services Ltd. and Indiabulls Housing Finance Ltd., which have some of the largest exposures to the sector, are also tightening funding.The risks of exposure to real estate were underlined by the scandal surrounding HDIL. The Reserve Bank of India abruptly imposed withdrawal curbs on a small cooperative bank that it said had under-reported loans to the developer. The decision triggered panic withdrawals from the bank, prompting the RBI to issue a statement to reassure the public that the banking system is “safe and stable.”The stresses in the banking industry are an added headache for the RBI, which cut rates by 25 basis points on Friday to counter slowing growth.Some commercial banks that lent to developers and shadow finance firms -- notably Yes Bank Ltd. -- have been caught up in the crisis. Banks had boosted overall lending to NBFCs by more than 50% over the past five years, to about $96 billion or nearly 8% of their total exposure.Yes Bank shares have led the declines in bank stocks, dropping more than 80% in the past six months, including a 12% slump this week. Its proportion of stressed loans could rise to more than 12%, from a net bad debt of 2.9%, according to Credit Suisse Group AG analyst Ashish Gupta.Yes Bank Chief Executive Officer Ravneet Gill said his bank only had exposure to three NBFCs. “There is a general perception that there is a closer linkage between Yes Bank and NBFCs than actually exists,” he said in an interview on Thursday.READ: How to Put India’s Shadow Banks on Firmer Ground“The biggest risk is, at its core, a liquidity crisis. A liquidity crisis left unattended balloons into a solvency crisis,” said former Reserve Bank of India Governor Duvvuri Subbarao, who steered India through the 2008 global downturn. While he doesn’t see any local bank going down in the current scenario, “some weak non-bank finance companies should be allowed to fail for the entire financial system to come out stronger,” he said.Prime Minister Narendra Modi’s administration and the RBI have taken steps to try to improve cash flow to shadow lenders, including allowing banks to lend more to the sector, providing partial credit guarantees, and easing banks’ mandatory liquidity ratios.RBI Governor Shaktikanta Das reiterated on Friday that the central bank has the top shadow lenders under its “intense” supervision. He had said last month that the RBI is closely monitoring the top 50 NBFCs, which contribute about 75% of the sector’s loans, and it won’t allow another systemically important NBFC to fail. He also assured that the RBI would not let any cooperative bank, a tiny lender chosen by scores of small individual depositors, collapse.Meanwhile non-real estate borrowers are getting caught in the cross-fire. India’s shadow banks catered to a third of new lending until a year ago, and the tightening of new financing has hit businesses from tailors to automakers and affected some of the nation’s biggest business conglomerates, including Anil Ambani’s troubled group, Essel Group Ltd. and Coffee Day Enterprises Ltd.Slowing property sales in a flagging economy make it even harder for many shadow lenders to get funding, including Clearwater-backed Altico Capital India Ltd., which defaulted on repayments last month.“The Achilles heel for the real estate sector is weak sales velocity, which has a direct impact on cash flows,” said Saswata Guha, director of financial institutions at Fitch Ratings. “At some point it is bound to have a cascading effect if unresolved.”About $24 billion of shadow bank loans to developers could sour in the coming two years, according to estimates from Anarock.Roots of the CrisisThe crisis has its roots in a lending binge by shadow banks between 2013 and 2018. Commercial banks were trying to chip away at a mountain of bad loans to large infrastructure and energy projects, so shadow lenders moved in, doubling their loan total to $438 billion in four years. Most of the new financing went to builders, home loans, and debt-laden infrastructure projects, according to rating company ICRA Ltd. In comparison, commercial banks’ lending rose just 46% to $1.36 trillion during the period.When IL&FS defaulted, the funds dried up, and risks on banks’ balance sheets started rising. Total bad loans could rise to a record 12% by early next year, according to Credit Suisse and Fitch Ratings.“A few months back we were essentially looking just at the real estate sector, but now the broader economic slowdown can affect other sectors and their creditworthiness,” said Fitch’s Guha.But saving an NBFC from collapse would mean forcing a bank to absorb all or part of its bad debt. So while Das is leaning toward enforcing market discipline on NBFCs, borrowers like Radius are worried the crisis will continue.“The reliance on NBFCs has heavily hit cash flows,” said Radius’ Shah, who hopes the measures taken by policy makers will help the sector. “The need for more money is acute.”(Updates with RBI’s comment in 15th paragraph)To contact the reporters on this story: Suvashree Ghosh in Mumbai at firstname.lastname@example.org;Dhwani Pandya in Mumbai at email@example.comTo contact the editors responsible for this story: Marcus Wright at firstname.lastname@example.org, Adam Majendie, Jeanette RodriguesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Yes Bank Ltd. Chief Executive Officer Ravneet Gill said he expects to complete raising as much as $1.2 billion “much sooner than the market expects,” after sales of pledged shares this week eliminated an overhang on the lender’s stock.Gill reiterated in an interview on Thursday his target of selling $1 billion to $1.2 billion of new shares to private equity investors, technology companies and family offices. He declined to be more specific on the timing for completing a deal. The stock surged 33%.“Ideally we would like to do this in one shot,” Gill said. “I think every stakeholder of the bank is of the same view that we should get as much capital as we need.”Yes Bank jumped more than 20% earlier in the day after Gill held a call with analysts to reassure them that the forced sale of founder Rana Kapoor’s pledged stake was the main reason why the stock had tumbled in the previous two sessions. Gains extended to as much as 36% later in the session.Even after the recovery, the amount of capital Gill is seeking is equivalent to as much as 86% of Yes Bank’s market value.“Overcoming the asset-quality issues and focusing on the bank’s retail deposit base will help it raise capital sooner than later,” said Jaikishan Parmar, an analyst with Angel Broking Pvt. in Mumbai.Kapoor, who co-founded Yes Bank in 2003 and built it into India’s fastest-growing lender, was forced out by the central bank amid a dispute over its reporting of bad debts. Gill was brought in from Deutsche Bank AG in March to stabilize operations, and has spent the past few months trying to raise capital. Even after Thursday’s surge, the stock is down more than 70% this year.Investors have also been concerned about Yes Bank’s exposure to India’s troubled shadow banking sector, which has been in turmoil since the default of a major non-bank infrastructure lender last year. The Reserve Bank of India is expected to cut interest rates again later Friday to moderate the ensuring credit crunch and spur economic growth.In the interview, Gill also said:The bank’s Core Tier 1 capital ratio improved in the fiscal second quarter from the previous three monthsWith fresh capital in place, Yes Bank should be able to expand at a pace of at least 20%The slump in Yes Bank’s shares on Monday and Tuesday didn’t cause any major deposit withdrawals(Updates with expected interest rate cut in eighth paragraph.)To contact the reporters on this story: Philip Lagerkranser in Hong Kong at email@example.com;Suvashree Ghosh in Mumbai at firstname.lastname@example.org;Anto Antony in Mumbai at email@example.comTo contact the editors responsible for this story: Marcus Wright at firstname.lastname@example.org, Philip Lagerkranser, Ravil ShirodkarFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Private-sector lender Yes Bank's Chief Executive Officer Ravneet Gill assured investors on Thursday that the bank remains on solid financial footing, sending its stock as much as 25% higher. The lender's management added they have been trying to conserve capital by reducing wholesale lending, while increasing it to government and small and medium enterprises (SMEs).
Indian lender Yes Bank Ltd said on Wednesday a forced stake sale by a shareholder led to a steep fall in the company's stock in the previous session. The company's shares plunged nearly 23% on Tuesday to its lowest close in over a decade, alongside sharp declines in other private-sector banks, as fraud allegations against a top mortgage lender and a prominent bank spooked investors. Milestone Trusteeship Services Ltd, the trustee for an issue of bonds by Yes Bank promoter Morgan Credits Private Ltd, invoked and sold 100 million shares of the lender pledged by founder Rana Kapoor, according to a filing.
(Bloomberg) -- One of India’s largest private sector lenders slumped by a record in the bond market on Wednesday, as concerns mount over the health of the nation’s finance sector amid a shadow banking crisis.Dollar bonds of Yes Bank Ltd., which has sizable exposure to the cash-strapped shadow lenders, slumped a record 5.5 cents to 80.9 cents on the dollar on Wednesday, the lowest since the bonds were sold in 2018.The bank is at the epicenter of rising stress in India’s credit markets, where shock defaults last year by a major infrastructure lender have led to broader strains at other shadow banks. Yes Bank’s shares collapsed about 23% on Tuesday to the lowest since 2009, amid concerns that a cleanup in corporate debt could drag on. Debt woes among India’s non-bank lenders including Indiabulls Housing Finance Ltd. have also prompted jitters for the sector.“The stock and bonds both are reflecting investor concerns on asset quality, where slower resolutions and rising stress could continue to pose pressure,” said Diksha Gera, a Bloomberg Intelligence analyst.The drop in Yes Bank’s share price on Tuesday was “primarily on account of the forced sale” of 100 million shares, “triggered by an invocation of pledge on the equity shares of a large stakeholder,” the bank said in a statement on Wednesday. Its financial and operating metrics remain “intrinsically sound” and stable, with its liquidity position “well in excess of regulatory requirements,” it added. A report had previously said that Yes Bank shares pledged by its co-founder Rana Kapoor, have been sold. The India stock market is closed today for a holiday.Kapoor stepped down as chief executive officer earlier this year after the Reserve Bank of India refused to grant him another three-year term amid a controversy over bad-debt accounting.(Adds details from Yes Bank in fifth paragraph)To contact the reporter on this story: Denise Wee in Hong Kong at email@example.comTo contact the editors responsible for this story: Andrew Monahan at firstname.lastname@example.org, Ken McCallumFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Indian stock indexes fell on Monday following a raft of negative news in the banking and real estate sectors, with shares in Indiabulls Housing Finance Ltd falling 34%. Yes Bank Ltd fell 15%, making it the top decliner on both indexes. Shares in Lakshmi Vilas Bank Ltd , which is proposing to merge with Indiabulls, also fell, by nearly 5% after the Reserve Bank of India (RBI) imposed a so-called prompt corrective action on the bank.
India's Yes Bank is close to securing a deal to sell a minority stake to a global technology company to help boost its capital, the lender's chief executive said. "We are in fairly advanced level of talks right now," Ravneet Gill, chief executive and managing director of the corporate and retail bank, told Reuters in an interview. Gill said the stake sale was initially likely to be less than 10% initially but could rise, describing the buyer as one of the world's top three technology companies that had not previously invested in a bank.
Moody's Investors Service has today downgraded Yes Bank Limited's long-term foreign-currency issuer rating to Ba3 from Ba1. Moody's has also downgraded the bank's long term foreign and local currency bank deposit ratings to Ba3 from Ba1, foreign currency senior unsecured MTN program rating to (P)Ba3 from (P)Ba1, and Baseline Credit Assessment (BCA) and adjusted BCA to b1 from ba2.
The broader NSE Nifty dropped 1.53% to 11,419.25, while the benchmark BSE Sensex closed 1.44% lower at 38,337.01. Whatever hopes there were around the finance minister removing the surcharge on foreign investors have been dashed, said Neeraj Dewan, a director with Quantum Securities, New Delhi, adding that sentiment had also been dampened by weak earnings by some lenders. Finance Minister Nirmala Sitharaman said on Thursday that foreign portfolio investors could instead register as companies to avoid a new tax surcharge imposed on individual tax payers as well as trusts in the budget for the fiscal year that began on April 1.
MUMBAI/BENGALURU (Reuters) - Indian lender Yes Bank Ltd posted a 91% drop in quarterly profit on Wednesday, due to a nearly three-fold rise in provisions for loan losses, while asset quality deteriorated sharply. Net profit for the three months ended June 30 came in at 1.14 billion rupees ($16.57 million), compared with 12.60 billion rupees last year. The private-sector lender shocked markets with its first-ever loss in the preceding quarter, as it set aside higher provisions and logged fresh bad loans to the tune of 34.81 billion rupees, some of which were on account of its exposure to a struggling airline and infrastructure conglomerate IL&FS.