The agency continues to await developments on YES Bank’s equity raising, which in the agency’s opinion is critical for providing sufficient cushion to the possible credit cost impact from the stressed asset pool on regulatory capital requirement in the short- and medium-term.
The agency has withdrawn the bank’s short-term rating since there is no outstanding against the same.
Although the liquidity position of the bank seemed adequate at end-September 2019 (liquidity coverage ratio of 114 per cent), Ind-Ra believes that in the absence of any swift capital raise, the bank’s ability to manage its asset and liability maturities could get tested further.
The bank continues to remain in discussions with various potential investors. However, Ind-Ra believes raising sizeable capital in the near term could be challenging and could require various regulatory and other approvals. The rating would be reviewed again in February 2020, the rating agency said.
At 9:41 AM, the stock was trading 0.65 per cent higher at Rs 38.95 as compared to 0.35 per cent decline in the benchmark S&P BSE Sensex. A total of 3.8 crore shares have changed hands on the NSE and BSE so far.
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