YES Bank picks IDFC Securities, Cantor Fitzgerald, Ambit to raise $2 bn

Cantor Fitzgerald is led by Anshu Jain, the former co-CEO of Deutsche Bank AG

Yes Bank has picked Cantor Fitzgerald, IDFC Securities and Ambit to help the lender raise as much as $2 billion for bolstering capital buffers, people with knowledge of the matter said.

The bank, staggering under the weight of soured loans, has been plagued by worries about its asset quality and uncertainty about efforts to raise new capital. It’s trying to shore up a core equity capital ratio that’s barely above a regulatory minimum of 8 per cent.

The lender’s shares surged the most since November 27 on Wednesday as investors were encouraged by the move to pick bankers, while its 2023 dollar bond gained the most since January 15. Yes Bank, led by Chief Executive Officer Ravneet Gill, has lost more than 80 per cent of its market value in the past year on concerns about its ability to raise funds.

“As credibility and sentiment get eroded, time is running out for the bank to raise capital,” according to Bloomberg Intelligence analyst Diksha Gera. 

“With the bankers for fund raising in place Yes Bank needs to move quickly to avoid panic among credit investors, which could cause unwanted liquidity pressure.” Cantor Fitzgerald is led by Anshu Jain, the former co-chief executive officer of Deutsche Bank AG until 2015, while Gill headed the German bank’s Indian operations before he joined Yes Bank last year. The Economic Times reported the appointment of the banks earlier.

A spokesman for Yes Bank and spokeswoman for Ambit declined to comment about the fund raising plans. A representative for IDFC Securities and spokeswoman for Cantor didn’t immediately respond to emails seeking comment.