Three lenders trim stake in Yes Bank within two weeks of investment
Photo Credit: VCCircle

Three private-sector banks, which had pitched in to save Yes Bank from the brim of a collapse last month, have pared their stake in the lender.

Federal Bank, Kotak Mahindra Bank and IDFC First Bank sold part of their stake between March 17 and March 31, stock-exchange data showed.

Federal Bank sold Rs 5.86 crore shares, Kotak Mahindra 4.72 crore and IDFC First Bank 4.02 crore shares.

As a result, Federal Bank’s stake in Yes Bank reduced to 1.92% from 2.39%, Kotak Mahindra Bank’s shareholding fell to 3.61% from 3.98% and IDFC First Bank’s stake declined to 1.67% from 1.99%.

Other lenders including State Bank of India (SBI), Axis Bank, Bandhan Bank and Housing Development Finance Corporation didn’t sell any shares during March and their stake in Yes Bank remained unchanged.

Mortgage lender HDFC and ICICI Bank owned a 7.97% stake each while Axis Bank held 4.78% and Bandhan Bank 2.39%. SBI owned a 48.21% stake.

SBI’s board had approved an investment of up to Rs 7,250 crore in Yes Bank on March 12. Other banks later joined SBI for what is the biggest-ever rescue in Indian banking history.

The investment came with the condition that at least 26% of SBI’s stake would be locked in for three years. The other seven lenders had to comply with a three-year lock-in for at least 75% of their investment.

The lock-in period was aimed at ensuring that Yes Bank remains sufficiently capitalised.

Rajnish Kumar, chairman at SBI, had said at a press conference on March 17 that SBI would not sell any part of its stake before the expiry of a three-year lock-in period. He also said that SBI could invest again if required in the second round of funding which is expected to take place in six months.

After the restructuring, Yes Bank reported a massive quarterly loss of Rs 18,560 crore.

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