Carlyle, Advent get conditional nod from RBI to own 9.99% in Yes Bank

MUMBAI: Private equity majors the Carlyle Group and Advent have got the RBI’s nod to own up to 9.99 per cent in Yes Bank, the private sector lender said on Thursday.

The two PE funds in July this year expressed an intent to pump in over Rs 8,000 cr in Yes Bank subject to regulatory permissions. Regulatory nod is required for owning over 5 per cent in a bank.

“We hereby inform you that vide separate letters date November 30, 2022, the Reserve Bank of India (RBI) has issued a conditional approval to each Investor with respect to the proposed acquisition by each of them of up to 9.99 per cent of paid-up share capital of the bank through subscription to equity shares and share warrants of the bank and the investors are evaluating the conditions,” it said in a regulatory filing.

“The investors are evaluating the conditions,” Mumbai-based Yes Bank said, adding that the bank and the investors will engage with the RBI to seek an early resolution of the conditions and get final approval. It was not immediately clear what the conditions were.

Yes Bank had, in July, said it would raise $1.1 billion from Carlyle and Advent for a 10% stake each in the bank, as it looked to boost its capital and fund growth. The funds were to be raised by issuing shares worth $640 mn and share warrants worth $475 mn. The proposed sale to the private equity firms came two years after the RBI stepped in to take control of the bank after a dramatic rise in toxic assets alarmed investors and depositors, posing a systemic risk to India’s banking sector. In September, Yes Bank approved the transfer of stressed assets worth Rs 480 billion ($5.91 billion) to private equity firm JC. Flowers in an attempt to clean up its balance sheet.