NEW DELHI: The Reserve Bank of India’s (RBI’s) decision to place a 30-day moratorium on Yes Bank and cap withdrawals at Rs 50,000 created a scurry as panicked depositors queued up at the bank’s branches and ATMs across locations for the second consecutive day on Saturday, even as the Enforcement Directorate continued questioning promoter Rana Kapoor.
Customers faced difficulties as most cash-dispensing machines ran dry and withdrawals at bank branches were possible through the old and much slower token system, thereby resulting in long queues. However, customers at some branches were able to withdraw the stipulated amount of Rs 50,000 through cheques.
Depositors are also facing trouble because internet banking services are not working. Some even complained that they were unable to make payments through their credit cards.
Yes Bank said it remains available to address all queries and clarifications. Depositors are requested to get in touch with the nearest branch for any assistance.
“We would like to inform you that our ATMs are now functional. You can locate the ATM nearest to you here: https://community.yesbank.in,” read the Yes Bank tweet, tagging the twitter handles of the finance ministry and the Reserve Bank.
Meanwhile, ED continued questioning Yes Bank founder Rana Kapoor in connection with a money laundering probe against him and others, officials said. The central agency had searched Rana’s residence in the upscale ‘Samudra Mahal’ complex in the Worli area on Friday night and had grilled him there too.
The case against Kapoor is linked to the scam-hit DHFL as the loans lent by the bank to the company allegedly turned non-performing assets (NPAs), they said.
Action against Kapoor is being conducted under the Prevention of Money Laundering Act (PMLA) by the ED.
The central agency is also probing Kapoor’s role in connection with the disbursal of loans to some corporate entities and the subsequent alleged kickbacks reportedly received in his wife’s accounts.
Other alleged irregularities are also under the agency’s scanner, including the one related to the alleged PF fraud in the Uttar Pradesh power corporation, they added.
An ED source said the central probe agency has expanded its probe in the Yes Bank scam and is also carrying out searches at the residential premises of all three daughters — Rakhee Kapoor Tandon, Roshni Kapoor and Radha Kapoor in Mumbai and New Delhi, as they were alleged beneficiaries of the scam.
On Friday, the RBI announced a draft scheme of reconstruction for the cash-starved Yes Bank.
In its draft ‘Yes Bank Ltd Reconstruction Scheme, 2020’, RBI said the strategic investor bank will have to pick up 49 per cent stake and it cannot reduce holding to below 26 per cent before three years from the date of capital infusion.
SBI’s board has already given ‘in-principle’ approval to explore investment opportunity in Yes Bank. SBI chief Rajnish Kumar said it is evaluating the draft reconstruction scheme for Yes Bank and has set a maximum investment limit of Rs 10,000 crore for the lender. He added that if SBI becomes the sole investor in the bank and picks up 49 per cent stake, then the immediate investment requirement would be Rs 2,450 crore.
“We have received draft scheme of reconstruction for Yes Bank. Our investment and legal team is doing due diligence,” Kumar said.
Bank officials are doing due diligence of the draft scheme, he added.
Yes Bank has been struggling to raise capital. It sought to raise $2 billion initially during this fiscal, which was then pruned to $1.2 billion as it could not rope in any investor.
The board of the bank is now being headed by former deputy managing director and CFO of SBI Prashant Kumar.
The ongoing crisis has also triggered a war of words between the BJP-led government and opposition parties.
A day after Congress leader Rahul Gandhi attacked Prime Minister Narendra Modi over the Yes Bank crisis and said his ideals have destroyed India’s economy, former finance minister P Chidamabaram also took a dig at the government.
Chidambaram said that the Yes Bank fiasco was caused by “mismanagement” of financial institutions under the BJP government and demanded that the RBI conduct a thorough probe and fix accountability in the matter. He added that it was “bizarre” for SBI to invest Rs 2,450 crore to pick up a 49-per cent stake in the crisis-ridden bank under a government-approved bailout plan.
Addressing a press conference on Friday, finance minister Nirmala Sitharaman blamed loans given under the UPA regime to stressed corporates for the financial troubles at Yes Bank. She stated that Anil Ambani Group, Essel, IL&FS, DHFL and Vodafone were among the stressed corporates in which the private lender had exposure prior to 2014.
Taking potshots at the UPA government, Sitharaman cited that the United Western Bank collapsed in 2006 under the “self-appointed competent doctors.”
In a statement, the CPI-M said that “collapse” of Yes Bank has raised many disturbing questions about the functioning of private banks and the failure of Reserve Bank of India to intervene in time and the episode was “the worst example of crony capitalism.”
On the other hand, minority affairs minister Mukhtar Abbas Naqvi slammed Congress leader Rahul Gandhi for his statement on Yes bank crisis and said that he should be worried about his party’s growth.
“Country’s economy is in strong and safe hands. Even when the world economy is crashing, we have maintained the growth,” he added.
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