Moody's Downgrades Yes Bank' Ratings Over Management Concerns

Subscribe to GoodReturns
For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

    Credit rating agency Moody's Investors Service downgraded its ratings for Yes Bank Ltd citing corporate governance concerns and implications that the change in management would bring to the growth strategy of the bank.

    Moody's Downgrades Yes Bank' Ratings Over Management Concerns
     

    The foreign currency, as well as local currency ratings for the lender, were lowered by the agency. Foreign currency issuer rating is now Baa3 from Ba1. The baseline credit assessment is cut from ba1 to ba2.

    Moody's has also maintained a negative outlook for the bank, suggesting the probability of another downgrade in the future. "The rating action considers the resignation of various members of the bank's Board of Directors -- which, when seen in conjunction with the Reserve Bank of India's directive in September 2018 to restrict the term of the bank's MD and CEO as well as founder, Rana Kapoor, till Jan. 31, 2019 -- have raised Moody's concerns over corporate governance," it said.\

    The bank is currently in a management transition mode after the RBI instructed the lender to find a CEO to replace founder Rana Kapoor by 31 January.

    "In Moody's opinion, although the bank's reported credit fundamentals remain stable, the developments surrounding the transition in leadership as well as the governance issues are credit negative because they complicate management's effective implementation of the bank's long-term strategy. Furthermore, these developments could constrain the bank's ability to raise new capital," Moody's further said.

    Shares of Yes Bank ended lowered at closing today.

    Read more about: yes bank
    Story first published: Tuesday, November 27, 2018, 16:44 [IST]
    Company Search
    Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

    Find IFSC

    Get Latest News alerts from Goodreturns

    We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more