Shares of the bank had slid in the past few sessions amid pending approval from RBI on Kapoor's re-appointment.
The stock declined 1.12 per cent to close at Rs 361.90 on BSE today.
Putting speculation to the rest, RBI approved the reappointment of Rana Kapoor as MD and CEO of Yes Bank but did not specify the period.
The Bank had sought permission from the RBI for the reappointment of Kapoor for a period of three years starting September 2018 onward.
Earlier this year, RBI denied a three-year extension to Axis Bank CEO Shikha Sharma despite board endorsing her reappointment.
Kapoor was among the founding team of Yes Bank, along with Ashok Kapur who died in 2008. As a promoter, Kapoor and his family own a 10.66 per cent stake in the bank. He has been the bank's CEO since 2004.
The banking sector has seen increased regulatory scrutiny over the last two years as the RBI has tried to push for appropriate recognition of bad loans. The asset quality review initiated in December 2015 has led to an increase in bad loans over Rs 6 lakh crore across banks, including Yes Bank.
Banks were asked to disclose divergences' in bad loan reporting. As a result, the RBI judged gross NPAs at Rs 83.738 bn for Yes Bank for 2016-17 against declared gross NPAs at Rs 20.18 bn. Thus, there was a divergence of Rs 63. 55 bn or three times the reported amount.