had asked Essel group promoters in January this year to increase its collateral so that the lender can ring-fence its exposure. The debt-laden group had asked for time till September to repay loans, after it sells a stake in flagship company Zee Entertainment.
The source said the bank is hopeful the sale will take place on time and its loans will be recovered in full.
Yes Bank's shares have tumbled by half since April 1. On Tuesday, the stock closed at Rs 141 a share, 1.8 per cent lower than its Monday closing. Early this month, the Reserve Bank of India
(RBI) had appointed former deputy governor, R Gandhi, to the bank's board.
Soon after Ravneet Gill took charge as the new CEO on March 1, the bank announced a net loss of Rs 1,507 crore for the quarter ended March 2019 (Q4) due to a fall in its non-interest income and a sharp rise in the provisioning for bad loans.
Gross non-performing assets (NPAs), as a percentage of gross advances, soared to 3.22 per cent in Q4, compared to 1.28 per cent in the year ago period.
Bad loan provisions stood at Rs 3,662 crore in Q4 and at Rs 5,778 crore for the full financial year of 2018-19, including specific loan loss provisions of Rs 1,270 crore, and mark-to-market provisions of Rs 243 crore. This also included contingent provisions of Rs 2,100 crore against a stressed asset of Rs 10,000 crore. This provisioning has a major bearing on the bank's credit portfolio, which is predominantly in the below investment grade rating.
In its analyst call, YES Bank said the provisioning covers companies
from real estate, media and entertainment and infrastructure, but did not provide any names.
Its provision coverage ratio -- at 33 per cent -- of total stressed assets is significantly lower than its loss, given the loan default experience of Indian banks. The coverage includes the provisioning for non-performing loans, standard assets and contingent provisions for stressed assets.