Two years after it was rescued by a special plan put in motion by the government and the Reserve Bank of India, private sector lender YES Bank is set to exit its reconstruction scheme with the formation of an alternative board.
The Board of Directors of the bank appointed under the Reconstruction Scheme, have recommended to its shareholders, the formation of an alternative Board in line with the directions of the Scheme, the bank said on Wednesday. The proposal will be taken up at its annual general meeting on July 15.
This comes on the back of YES Bank’s turnaround and significant progress post the implementation of the YES Bank Reconstruction Scheme March 2020, it said.
The bank’s largest shareholder, State Bank of India, has proposed Prashant Kumar’s candidature for the position of Managing Director and CEO of the bank for a period of three years, which will be subject to approval of the alternative board, RBI and the shareholders.
Based on SBI’s recommendation, the alternative board would include Atul Malik, Rekha Murthy, Sharad Sharma, Nandita Gujar, Sanjay Kumar Khemani, Sadashiv Srinivas Rao, T Keshav Rao, Sandeep Tiwari and Prashant Kumar.
The term of two RBI appointed additional directors -- R Gandhi and Ananth Narayan Gopalakrishnan -is valid upto March 23, 2023 or till further orders, whichever is earlier.
YES Bank’s Chairman Sunil Mehta and board members Mahesh Krishnamurti and Atul Bheda, who were appointed under the reconstruction scheme, would be handing over charge to the alternative board.
Sunil Mehta, Chairman, YES Bank, said, “YES Bank today accomplishes a significant milestone of coming out of the Reconstruction Scheme by initiating the process of formation of the alternative board.”
YES Bank was brought under the reconstruction scheme in March 2020. It posted its first full year profit of ₹1,066.21 crore in 2021-22, the first since 2018-19. The bank is also working on an asset reconstruction company which would take over its entire gross non performing asset pool. It has raised ₹15,000 crore of equity capital in July 2020 leading to an improved CET1 Ratio of 11.6 per cent as on March 31, 2022, from 6.3 per cent as on March 31, 2020.