After the great crisis and cash crunch in the Yes Bank, The RBI and the central has announced a possible restructuring to save the interests of the depositors.
Since last few months, Yes Bank is not only in the news but in severe debts as well. Currently, the Reserve Bank of India has already constrained the withdrawal limit for the Yes Bank customers. In a month, the customers of Yes Bank will now be able to withdraw 50,000/- only. After the restrictions by the RBI was announced, the share market investors are also taking their foot back from investing their money in Yes Bank shares. If the facts to be believed, it is being said that the former Managing Director and CEO Rana Kapoor is responsible for this condition of Yes Bank.
RESTRUCTURE PLAN BEEN ANNOUNCED BY THE RBI:
If the current and Live status of the Yes Bank to be asked, the Finance Minister of India, Nirmala Sitharaman broke the silence about that for the first time. The government already started taking genuine attempts to infuse fresh equity in Yes Bank. But that did not work, and nothing could be materialized. The Finance Minister has assured that the money of the customers and the depositors are safe with Yes Bank.
She also added that she is not in regular touch with the RBI. The RBI governor has assured the ministry that the issue will be resolved at the earliest. The government of India and the RBI are taking the combined effort to resolve the current crisis. The finance minister has also added that she has worked closely with the Reserve bank of India for a couple of months and has monitored for a couple of months.
As per the updates from the RBI governor, very swift action can be expected from the apex bank considering an immediate revival process of Yes Bank.
IS RBI PROTECTING THE PEOPLE’S INTEREST FULLY?
After the ATMs of the Bank ran out of cash, it became an entirely new problem for the customers of the Yes Bank. The upcoming Holi festival without money turned out to be bigger than the epidemic right now. Last night an SOS alert was sent from the Mumbai Police control room to check all the Yes Bank ATMs across the city.
To restore the confidence of the customers in the Bank, the central government and the RBI are taking faster and better decisions intervening with the directors of the Yes Bank for 30 days. The restoration plan is also including the placement of the reconstruction scheme or amalgamation. The ex-DMD and CFO of the State Bank of India has been administrated under section 36ACA (2).
The RBI will draw up some schemes in the coming days with the approval of the central government, before the moratorium period of 30 days ends. The RBI has also asked the depositors not to panic and also announced that their interest would be protected.
YOU MUST ALSO KNOW THE FINANCIAL POSITION OF YES BANK RIGHT NOW:
Over the last few years, the financial condition of Yes Bank has declined rapidly. The Bank was even unable to raise adequate fund to cover up the loan losses, If we go through the expert’s analysis, after the 26/11 attack in Mumbai and after the death of Ashok Kapoor, who was the co-founder of Yes bank died, Rana Kapoor and wife of Ashok Kapoor, been involved in some conflicts regarding the ownership of the Bank. The battle gradually hollowed the roots of the business, and the Bank ended up in a financial condition over the last few years, where it is today.
The Bank has encountered heavy losses due to the deposit withdrawals by its customers, and in the last four quarters, the Bank is failing to make adequate profits. The Bank has also encountered severe governance issues which are also responsible for the current condition of the Bank.
HOW LONG WILL BE THE CAPING SUSTAIN ON CASH WITHDRAWAL?
Now when the RBI has amended the withdrawal limit to be 50,000/- for the customers of the Yes Bank, the question is till how long will that sustain. The cap will remain from the 5th of March till the 3rd of April and that is overall a period of one month. The withdrawal limit for the depositors will stay the same until there is another notification from the RBI. The central bank said that for the sake of protecting the interests of the depositors, specific directions are needed over Yes Bank.
Long queues, closed down machines are not only the problems being faced by the customers, but the online fund transfer has also been restricted for Yes bank right now. The share value of the Yes Bank is 16.20/- right now on BSE, which is down by 56 %.
However, the customers can withdraw up to Rs. 5 Lakhs under emergency conditions like medical emergencies, marriages, education, etc. even after the restriction is put on.