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YES Bank falls 14% in two days following Ashok Chawla's resignation

The stock is down 7% at Rs 191, extending its previous day's 7% fall after former SBI chairman O P Bhatt resigned from the panel set up by Yes Bank to find a successor to its MD and CEO Rana Kapoor

SI Reporter  |  Mumbai 

YES Bank Photo: Reuters
YES Bank Photo: Reuters

Shares of continued to remain under pressure, slipping 7% to Rs 191 on Friday, extending their 7% fall on Thursday on the BSE, after the private sector lender said that its non-executive Chairman has resigned. The bank had also said that Independent Director Vasant Gujarathi too quit citing personal commitments.

On Thursday after market hours, the bank said that the former State Bank of India’s (SBI) chairman has resigned from the panel set up by to find a successor to its MD and CEO

"announces that Shri Ashok Chawla, Non-Executive Independent Part-Time Chairman, has tendered his resignation from the Bank's Board, with immediate effect, mentioning that during the current transition period, the Bank would need a Chairman who could devote more time and attention," the bank said in a regulatory filing on Wednesday.

“We would like to inform that Mr. O. P. Bhatt has tendered his resignation from his duties as an External Expert of the 'Search & Selection Committee' with immediate effect citing that there may be a potential conflict of interest,” the bank said in a statement.

JP Morgan rate YES Bank as a Neutral as the brokerage firm foresee the bank’s valuation as being range bound until issues surrounding leadership and equity-raising get resolved.

“YES’s loan growth, we believe, will moderate in FY20 as the base effect builds up. Further, given the unusual set of circumstances around the CEO’s (Mr. Rana Kapoor) departure, the market may question the sustainability of credit costs and NPLs. RBI's divergence report and smooth leadership transition could help address that,” analysts at the foreign brokerage said in a report dated October 26, 2018.

At 09:51 am; YES Bank was trading 6.5% lower at Rs 193 on the BSE, as compared to 0.70% rise in the S&P Sensex. The stock hit a 52-week low of Rs 166 on September 28, 2018, on the in intra-day trade. The counter has seen huge trading volumes with a combined 27 million equity shares changed hands in first half-an-hour of trade on the NSE and so far.

First Published: Fri, November 16 2018. 09:55 IST