YES Bank shares jump 2% after lender initiates process to come out of reconstruction scheme

NEW DELHI: Shares of YES Bank rose 2 per cent after the lender initiated the process of formation of the alternate board. The bank is set to come out of the YES Bank Reconstruction Scheme 2020.

The company said its existing board of directors has recommended the constitution of an alternate board for approval of shareholders at the ensuing AGM, which will be held on July 15, 2022 via video conferencing.

“The alternate board is being constituted and will operate under the applicable laws and regulations as against the current board which was constituted and is functioning under the ambit of the Reconstruction Scheme,” said the lender in a release.

Government of India had notified the YES Bank Reconstruction Scheme, 2020 on March 13, 2020. The existing Board of the Bank was constituted under the rules laid out in Para 5 of the Reconstruction Scheme. This included four government appointed directors, two SBI nominees and two RBI nominees.

The bank’s largest shareholder, State Bank of India, has proposed Prashant Kumar’s candidature for the position of MD and CEO of the Bank for a period of another three years, which will be subject to approval of the alternate board, Reserve Bank of India and the shareholders.

Sunil Mehta, Chairman, Mahesh Krishnamurti and Atul Bheda – Board members as appointed under the Notification dated March 13, 2020, of the Reconstruction Scheme, would be handing over charge to the alternate board.

“The most satisfying and fulfilling outcome for us has been the renewed business momentum and trust we have regained with our customers, employees, regulators, investors and all our stakeholders. As demonstrated over the last several quarters…the bank now is fully ready to achieve its long term growth trajectory under the direction of the alternate board being formed,” said Sunil Mehta, Chairman, YES Bank.