SBI Press Conference On Yes Bank: Believe SBI’s Contribution Won’t Exceed Rs 10,000 Crore, Says Rajnish Kumar 

On RBI Action

• Won't comment on writing down of Yes Bank's AT1 bonds
• Prima facie it seems that the value of Yes bank is set at Rs 2,550 crore. Which is why the RBI has chosen to keep the premium at Rs 8
• Will be going to RBI on Monday with our comments

Merger With Yes Bank Ruled Out

• We have been approached by some potential investors
• Will have to see how investors value Yes Bank
• I had said that there is no question of merger of Yes Bank with SBI and I stand by it
• There is no question of any conflict of interest

SBI’s Contribution, And Impact On Finances

• SBI's capital ratios will not be impacted by this investment
• Will not need to raise any further capital from the market. Will not require to raise capital from government either
• Don't believe that our contribution toward Yes Bank will exceed Rs 10,000 crore.

• Yes Bank's employees have been given protection under the reconstruction scheme
• It is necessary that their morale is kept high

• Investment decisions are by choice. No compulsions
• Our board mandate is that we must maintain 0.5 percent above regulatory minimum capital adequacy. We will continue to do that
• Have to give assurance to potential investors and depositors. That's why we are stepping in
• There is a certain process which has to be followed when a bank is being reconstructed. It had to be done
• There were not many options before RBI and government, which is why, they had to go with this proposal.

• SBI's minority shareholders are very important for us. We will be keeping their interests in mind
• SBI's philosophy is not to thrive in the misery of others
• Like all our associates and subsidiaries, we will keep Yes Bank investment at arm's length

• A small, medium or big bank's failure has huge effects on the economy and the banking system
• To say that private enterprises should not be saved is wrong. Any enterprise is a national asset and closing it down is a loss for everyone.
• The U.S. and the U.K., considered capitalist role models, have stepping in to save private enterprises
• Wherever help Is required from us as a creditor or lender, we have always extended help.

• We had tried our best to save Jet Airways. But in the circumstances it could not be revived.

• Prima facie, it seems that the value of Yes bank is set at Rs 2,550 crore
• Which is why the RBI has chosen to keep the premium at Rs 8
• Read what the analysts were saying about Yes Bank just a year ago. So you can't take this Re 1 value as the right value

• As far as depositors are concerned, there might be some inconvenience
• But as far as safety of their money is concerned it is fully safe
• I am not Deposit Insurance and Credit Guarantee Corporation to give guarantees for deposits. There is a Rs 5 lakh guarantee available for depositors. But I am just letting everyone know that I agree with RBI and government's assurance to depositors.

• SBI has not lost money in any investment it has made
• We have also ensured that our JV partners are not disappointed

• Many investors have already done their due diligence in Yes Bank
• We will work over time 24x7 to complete our due diligence

• Considerable investor interest in India's financial sector
• Will look at investment proposals in consultation with RBI
• Final decision on the path ahead rests with SBI board
• Many investors have already done their due diligence in Yes Bank
• Will try to get resolution plan approved and implemented much before the RBI deadline

• SBI will be taking over 49 percent stake and will maintain a minimum of 26 percent stake for three years

• Writing down AT-1 bonds is part of the RBI's scheme
• Will not comment on why the RBI chose to do so

• RBI's draft scheme is already in the public domain
• Our investment and legal team is doing due diligence on the draft
• Will be going to RBI on Monday with our comments

The State Bank of India will today flesh out details of the draft rescue plan for Yes Bank Ltd. proposed by the Reserve Bank of India.

The reconstruction plan, which RBI put out last evening, proposes that SBI acquire a 49 percent stake in beleaguered Yes Bank at a minimum of Rs 2,450 crore.

The RBI, which advised the government to place Yes Bank under one-month moratorium, has placed the draft restructuring scheme in public domain for comments.

According to the scheme:

• Yes Bank’s authorised capital shall stand altered to Rs 5,000 crore from the current Rs 800 crore.
• The number of equity shares will be increased to 2,400 crore from the current 255 crore (face value Rs 2/- each) aggregating to Rs 4,800 crore.
• SBI shall agree to invest in the equity of the reconstructed bank such that post infusion it holds 49 percent.
• The capital infusion will be at not less than Rs 10 per share (Face value Rs 2, Premium Rs 8)
• SBI shall not reduce its holding below 26 percent for three years from date of capital infusion.

Here’s more on RBI’s proposal.

That came after the government of India put Yes Bank under a one-month moratorium, capped withdrawals while RBI superseded its board as it saw a steady deteriorate in the bank’s financial position.

Here’s more related coverage around the Yes Bank crisis:

• Mutual Funds With Equity Exposure To Yes Bank
• Here’s How Much Mutual Funds Are Exposed To Yes Bank Debt
• Yes Bank Shares Fall 85% Intraday To Lowest On Record
• Max Financial Falls The Most Since July 2016 On Yes Bank Crisis
• Yes Bank’s Bonfire Of Insanity Was Left To Burn
• Indian Rupee Slides, Bonds Rally After RBI Seizes Yes Bank