Cabinet Clears SBI’s Draft Resolution Scheme For Yes Bank

The Union Cabinet on Friday approved the draft resolution scheme for Yes Bank crafted by the State Bank of India (SBI), according to a CNBC-TV18 report.

YES Bank: Quotes, News

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State Bank of India: Quotes, News

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Last week, after RBI put the troubled private bank under Moratorium, the central bank released a draft reconstruction scheme that proposed the share capital of the restructured bank to stand altered to Rs 5,000 crore and the number of equity shares to 2,400 crore of Rs 2 each aggregating to Rs 4,800 crore.

The draft scheme also said that SBI as a strategic investor was required to not reduce its holding below 26% in the reconstructed bank before completion of three years from the date of infusion of the capital. Further, it could pick up as much as 49% stake in the new entity.

On Thursday, in a stock exchange filing, SBI said that the Executive Committee of Central Board (ECCB) appointed for the rescue plan has "accorded approval for purchase of 725 crore shares in Yes Bank Ltd. at a price of Rs.10 per share subject to all regulatory approvals."

"Our shareholding in Yes Bank Ltd. will remain within 49% of the paid up capital of Yes Bank," it added.