New Delhi: The Reserve Bank of India (RBI) on Friday placed in public domain a draft scheme of reviving Yes Bank, the public lender that has been put under the control of the central bank.
The draft noted that all the employees of the reconstructed Yes Bank will continue in its service with the same remuneration and on the same terms and conditions of service, including terms of determination of service and retirement, as were applicable to such employees immediately before the appointed date, at least for a period of a year.
The board of directors of the reconstructed Yes Bank will, however, have the freedom to discontinue the services of the key managerial personnel (KMPs) at any point of time after following due procedure.
The offices and branches of the reconstructed Yes Bank will continue to function in the same manner and at the same places they were functioning prior to the effective date, without in any way being affected by this scheme.
The RBI said it will be open to the reconstructed Yes Bank to open new offices and branches or close down existing offices or branches, in accordance with the extant policy of the central bank.
In its document 'Yes Bank Ltd. Reconstruction Scheme, 2020', the RBI said the strategic investor bank will have to pick up a 49% stake and it cannot reduce its holding to below 26% before three years from the date of capital infusion. The draft also said that authorised capital shall stand altered to Rs 5,000 crore and the number of equity shares will stand altered to Rs 2,400 crore at Rs 2 each.
The investor bank will agree to invest in the equity of reconstructed Yes Bank to the extent that post infusion it holds 49% shareholding in the reconstructed bank at a price not less than Rs 10 and premium of Rs 8.
The investor bank will not reduce its holding below 26% before completion of three years from the date of infusion of the capital into Yes Bank. From the appointed date, the office of the administrator of Yes Bank, appointed by the RBI, will stand vacated, and a new board will be constituted.
The investor bank will have two nominee directors appointed on the board of the reconstructed Yes Bank. The RBI may appoint additional directors on the board of the Yes Bank — it will be open to the board of directors of Yes Bank to co-opt more directors. It added the SBI has "expressed its willingness" to make investment in Yes Bank and participate in its reconstruction scheme.
The draft comes a day after the RBI imposed a moratorium on the bank, restricting withdrawals to Rs 50,000 per depositor till April 3.
The RBI had invited suggestions and comments from members of public, including the banks' shareholders, depositors and creditors on the draft scheme. The draft scheme has also been sent to Yes Bank and SBI for their comments. RBI will receive suggestions up to Monday, March 9, and thereafter take a final view.
Earlier in the day, RBI chief Shaktikanta Das had said the central bank will act swiftly to resolve the issue.
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