All you need to know about YES Bank-RBI tussle over Rana Kapoor's extention

RBI cuts short Kapoor's term till January 31, 2019

Yes Bank Ltd, India's fifth largest private-sector lender by assets, has had a tumultuous couple of months since the country's central bank trimmed extension to its chief executive officer's (CEO's) term in September.

The move by the Reserve Bank of India (RBI), which has already clamped down on the financial sector due to rising levels of bad loans, has hit Yes Bank's share price hard and also spurred several departures in the company's top brass.

The developments since Sept. 19 have wiped off over 290 billion rupees ($4.06 billion) from the company's market value, as of Tuesday's close.

Here's how the saga unfolded:

June 12: Yes Bank's shareholders approve http://bit.ly/2KoO0Fj Rana Kapoor's re-appointment as managing director (MD) and CEO for three years from Sept. 1.

Aug 30: Bank gets https://www.bseindia.com/xml-data/corpfiling/CorpAttachment//2018/8/1d3f3d36-0b55-4266-ab79-14bee3f65e9a.pdf RBI's nod for Kapoor to continue as MD and CEO till further notice from the central bank.

Sept 19: RBI cuts short Kapoor's term till Jan. 31, 2019.

Sept 21: On the first day of trade after RBI's announcement, Yes Bank shares tank over 30 percent, and the lender loses as much as $3.1 billion in market value.

• Market insiders say RBI's move exemplifies its increasingly assertive approach in tackling the bad debt problem plaguing India's banking sector.

Sept 25: Lender's board decides to seek RBI's nod to extend Kapoor's term until at least April 30, 2019, says it will form a committee to search for Kapoor's successor.

Sept 28: Kapoor, in a tweet, says he remains committed to interests of the bank and its stakeholders. He also says he will never sell his promoter shares, but pass them on to his daughters.

• Rating firm CARE Ratings places http://bit.ly/2Bgn1IK Yes Bank's debt instruments under 'credit watch with developing implications', citing RBI's move to restrict Kapoor's term.

Oct 5: Bank names T S Vijayan, former chairman of India's insurance regulator, and OP Bhatt, former chairman of State Bank of India, as external experts of the search and selection committee.

Oct 11: Yes Bank appoints https://www.bseindia.com/xml-data/corpfiling/AttachHis/19047ba7-573e-4045-9ba9-41d38482a714.pdf advisory firm Korn Ferry to help find a new CEO.

Oct 17: RBI refuses to give Rana Kapoor more time at the bank and asks the lender to find a new CEO by Feb 1, 2019. Yes Bank says it aims to complete the recruitment process by mid-Dec.

Oct 25: Yes Bank's second-quarter profit misses estimates by a wide berth as provisions for bad loans and mark-to-market losses more than double, and asset quality deteriorates.

• The lender also says it has an exposure to debt-laden Infrastructure Leasing and Financial Services.

Oct 26: The bank's CEO search panel finalises a potential candidate profile. Korn Ferry also shares a list of candidate pool.

Nov 12: Media report says Yes Bank sought guidance from the RBI on Ashok Chawla continuing as chairman after being named in a corruption chargesheet.

Nov 14: Ashok Chawla resigns from Yes Bank's board. Vasant Gujarathi also steps down https://www.bseindia.com/xml-data/corpfiling/AttachHis/641234fb-bd72-4a8d-b54e-a48d4011323c.pdf as independent director.

Nov 15: OP Bhatt resigns as an external expert of the search and selection committee, due to "potential conflict of interest".

Nov 19: Independent director Rentala Chandrashekhar resigns https://www.bseindia.com/xml-data/corpfiling/AttachLive/6aece6cb-d2ff-44ce-b280-bc52737b6990.pdf.

Nov 20: Yes Bank says
https://www.nseindia.com/corporate/YESBANK_20112018215715_PressReleaseUpdateOnYESBANKBoardMatters_348.pdf that selection process for the MD and CEO is on track, recent resignations of board members bear no impact.

• Efforts are underway for mutual resolution between Rana Kapoor and Madhu Kapur and her family, the co-promoter.

• Board now consists of seven members, after addition of Uttam Prakash Agarwal.

 

 

 

(Compiled by Chris Thomas and Tanvi Mehta in Bengaluru; Editing by Rashmi Aich)