So much water has flown under the bridge that it is difficult to ascertain what to expect next in Yes Bank fiasco, from being 4th largest private bank with strong track record in corporate lending to almost a quasi nationalised bank.
Everything from risk mitigation, corporate governance to regulatory oversight has stopped Yes Bank from falling over the precipice.
The current bailout by SBI led consortium is a step towards stopping the banking viral contagion of NPA's destroying Indian banking sector. Who would have imagined in November that SBI, Kotak, HDFC, LIC, Axis and now a newbie like Bandhan bank will bailout Yes bank. This is inherent strength of Indian banking sector but a morally questionable move considering how does SBI keep arm's length from day to day functioning. What stops Yes bank from moving from a free market bank to bureaucratic bank.
If you are an existing investors it's better to sell when opportunities arise after the bailout.
Scenario 1 On 14th March the balance sheet shows reducing NPA's then the stock would scale new highs each quarter.
Scenario 2 more realistic one a lot of Loans turn to NPA's further plus erosion in bulk deposits. The share price falls below 10 RS. The lock-in of 3 years I suspect is to stop the stop getting hammered .
Be wise and don't speculate and invest at the moment . The opportunity will arrive below 10 RS.
Everything from risk mitigation, corporate governance to regulatory oversight has stopped Yes Bank from falling over the precipice.
The current bailout by SBI led consortium is a step towards stopping the banking viral contagion of NPA's destroying Indian banking sector. Who would have imagined in November that SBI, Kotak, HDFC, LIC, Axis and now a newbie like Bandhan bank will bailout Yes bank. This is inherent strength of Indian banking sector but a morally questionable move considering how does SBI keep arm's length from day to day functioning. What stops Yes bank from moving from a free market bank to bureaucratic bank.
If you are an existing investors it's better to sell when opportunities arise after the bailout.
Scenario 1 On 14th March the balance sheet shows reducing NPA's then the stock would scale new highs each quarter.
Scenario 2 more realistic one a lot of Loans turn to NPA's further plus erosion in bulk deposits. The share price falls below 10 RS. The lock-in of 3 years I suspect is to stop the stop getting hammered .
Be wise and don't speculate and invest at the moment . The opportunity will arrive below 10 RS.
