Depositors’ money safe, don’t see panic withdrawals: Yes Bank
With normal banking services in Yes Bank to resume at 6 p.m. on Wednesday, the private sector bank’s administrator and new investors assured all deposit holders that their savings in the bank were absolutely safe and customers would have much better experience when they resume usual interaction with the lender.
“There is no need to worry about safety of deposits in the bank. The bank has emerged stronger with the equity support of domestic banks and quick action by the RBI and the government. So when normal banking services resume tomorrow, customers can expect to get much better experience,” Prashant Kumar, Yes Bank administrator and the next MD and CEO of the bank’s newly constituted board, told media persons at a press conference.
Responding to questions whether there would be a flurry of withdrawals from the depositors once normal banking services resume on Wednesday, he said that Yes Bank has sufficient funding lines available with it and based on analytics and positive vibes generated by the restructuring scheme, there would not be a flurry of withdrawals.
“Even during moratorium period, only one-third of depositors withdrew their savings to the extent of Rs 50,000 while the remaining did not withdraw at all. In fact, in last four days, Yes Bank has seen more inflows than outflow,” Kumar said.
Asked if there was a contingency plan to check withdrawal rush, he said he had no reasons to believe why that would happen but even in the event of an eventuality, the bank has sufficient funding lines available to it.
The State Bank of India (SBI), which has become the anchor investor in Yes Bank after if picked up close to 49 per cent stake in the bank, also said that it did not see nervous depositors flocking Yes Bank branches for withdrawals once normally banking services resumed. “There are sufficient funding lines to meet any eventuality. We do not see another moratorium being put in place,” said SBI Chairman Rajnish Kumar.
He added that everyone wanted to lift moratorium on Yes Bank at the earliest given strong presence of SME sector on its portfolio. Longer restrictions would have impacted the segment.