New Delhi: Finance Minister Nirmala Sitharaman on Friday announced a bailout plan for Yes Bank, which was placed under moratorium last week by the Reserve Bank of India (RBI). The plan, proposed by the RBI, would see the State Bank of India (SBI), investing up to 49% equity in Yes Bank, with other investors being invited as well. Also Read - SBI Gets Approval to Invest Rs 7,250 Crore in Crisis-hit Yes Bank
The plan was cleared by the Union Cabinet in a meeting held earlier today. The Finance Minister addressed the media hours after the meeting took place. Also Read - Court Extends Yes Bank Founder Rana Kapoor's ED Custody Till March 16
The notification for the bailout plan, the Finance Minister said, would be issued soon and the moratorium would come to an end at 6 PM, within three working days from the date of the notification. “The Yes Bank administrator would vacate his office within seven days calendar days after the lifting of the moratorium. After this, a new board would be constituted,” she further said. The board would have at least two directors from the SBI. Also Read - YES Bank Customers Can Now Use NEFT, IMPS to Pay Their Dues
Notably, the RBI, by virtue of the moratorium, took over the Yes Bank board of directors, with immediate effect, for a period of one month. Prashant Kumar, former Deputy Managing Director (DMD) and Chief Financial Officer (CFO) of the State Bank of India (SBI), was appointed as the administrator of Yes Bank.
Sitharaman added that under the RBI-backed plan, the SBI, which had yesterday approved a plan to invest Rs 7,250 crore in Yes Bank, would need to maintain a minimum of 26% holding in Yes Bak for a period of three years.
The RBI, in order to protect the depositors, has capped withdrawals from Yes Bank accounts at Rs 50,000 till April 3.