Yes Bank to raise $175 mn via QIP

Yes Bank will raise $150-175 million from private placement or qualified institutional placement (QIP) of equity shares in the first quarter of 2008-09 (April-March), Rana Kapoor, chief executive officer and managing director, said today.

"We would prefer a QIP," Kapoor said on the sidelines of a function here to sign a pact between Yes Bank and Wageningen University and Research Centre for developing agro logistics networks and agro food parks in India.

The private sector bank will dilute 6.36 per cent stake via the equity issue by offering 20 million new shares, Kapoor said. Some foreign investors have expressed their interest to buy 5 per cent stake in the bank.

"We may sell it to a financial investment arm of a bank or financial investors," Kapoor said in reply to a query on the investors interested in buying the stake. The share issue will reduce the promoter's stake proportionately in Yes Bank to 32.2 per cent from 34.2 per cent at present. "We are holding back our equity raising plan and are waiting for the market to settle," Kapoor said.

Capital adequacy ratio of the bank is 14.5 per cent. "We will take enabling approval for QIP on Monday at our extraordinary general meeting," Kapoor said. Yes Bank is also planning to raise Rs 500 crore through tier-II bonds in the first-half of FY09, Kapoor said.

'Let banks into comex broking'

Banks should be allowed to act as brokers in commodity exchanges because of their better risk management policies, Rana Kapoor, chairman, managing director and chief executive officer, Yes Bank, said today.

"I think banks have the better risk management systems in place and hence, they should be allowed to act as brokers in commodity markets," Kapoor said.

Due to clearance of Warehousing Development and Regulation Act, a lot of activity will shift in this sector which would create the need for funds over a period of time, Kapoor said. Looking at this opportunity, Yes Bank has bought a 2.5 per cent stake in National Collateral Management Services, the warehousing arm of National Commodity and Derivatives Exchange, Kapoor said.