Yes Bank shares gain 2 pc after SBI fund infusion

Shares of Yes Bank on Friday rose by 2 per cent after State Bank of India (SBI) said it will infuse Rs 7,250 crore into the crippled private sector lender.

The stock surged 9.98 per cent to Rs 27.55 on BSE in day trade before closing at Rs 25.55, showing gains of 2 per cent.

In opening trade, the stock touched lower circuit at Rs 22.55 on BSE.

On the NSE, the stock jumped 10.57 per cent to Rs 27.70. It settled the day at Rs 25.50, up by 1.80 per cent.

In terms of volume, more than 27 crore shares were traded on the NSE and over 2.6 crore units were exchanged on BSE.

State Bank of India on Thursday announced a Rs 7,250-crore fund infusion into the crippled Yes Bank under which it will pick up to 49 per cent equity in the fourth largest private sector lender.

The SBI investment of Rs 7,250 crore is much higher than Rs 2,450 crore it had planned initially for 49 per cent stake in the private sector lender that began operations in 2004.

Meanwhile, the Union Cabinet on Friday approved a reconstruction scheme for Yes Bank under which SBI will acquire 49 per cent stake in the private bank.

There will be a three year lock-in period for all the investors, finance minister Nirmala Sitharaman said. However, the lock-in period for SBI would be only for the 26 per cent of the shareholding.

The authorised capital of the lender has been increased to Rs 6,200 crore from Rs 1,100 crore, the finance minister said.

Yes Bank has been struggling to raise capital amidst its dwindling financial health. It sought to raise USD 2 billion initially during this fiscal, which was then pruned to USD 1.2 billion as it could not rope in any investor.