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With the moratorium on Yes Bank, concerns amongst investors and depositors are also spreading about other small and mid-sized private sector lenders. IndusInd Bank has written a letter to its shareholders stressing on its strong fundamentals.
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Withdrawals capped at ₹50,000/depositor; the bank may be merged with SBI“As you are aware, there are some financial market issues affecting a private sector bank that has been highlighted in the press; these are issues specific to that entity and are being dealt with by the RBI / Government so as not to pose a systemic risk. Similarly, there are challenges in terms of environmental issues caused by the spread of Coronavirus to address which, various initiatives have been, and are being, taken so as to ensure that employees and customers remain safe,” the private sector lender said in the letter, expressing hope that these issues will pass soon.
It further said that despite these pockets of external turbulence, Induslnd remains focussed on building scale with profitability, on a platform of strong capitalisation and liquidity and high credit ratings.
IndusInd Bank also dismissed speculation on its investment in Yes Bank. “We have neither contemplated nor evaluating any such investment,” the bank said in the letter by its MD and CEO Romesh Sobti and MD and CEO Designate Sumant Kathpalia.
The private sector lender will also be soon unveiling its next three-year plan which will include a deep focus on Rural India, capitalising on our areas of domain expertise such as Vehicle Financing, harnessing the power of our large and growing network, building scale in some sub scale retail products like credit cards, increasing participation in deposit segments such as NRI / Wealth Management and making assets/liabilities more granular in their make-up. “All of this will be underpinned by a digital DNA to drive revenues, efficiencies and customer experience,” it said.
With the turbulence at Yes Bank, IndusInd Bank had decided to defer its fund raising plans. The lender’s scrip has been under pressure and was down by over 5 per cent on Thursday on BSE.
A day earlier on Wednesday, RBL Bank had also clarified on speculation and had said the bank is well capitalised with no material adverse change in the asset quality since the third quarter results. “We wish to re-emphasize that RBL Bank is a fundamentally strong institution,” it had stressed.
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