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PMC, GRS and now the ironically named Yes Bank - as FM Nirmala Sitharaman projects yet another series of reassurances to the Indian economy, it remains plagued by sub-par performance - with the bankâs dissolution, its share price has also spiralled downwards to just Rs 16 today - fifteen times less than its value about a year ago.
What if fluctuating stocks and complicated regulatory acts arenât your thing, though? Whether youâre worried about your own Yes Bank account or watching the show from the sidelines, weâve compiled a simple timeline that explains just how Yes Bankâs story swung from positive to negative - take a look.
2003-2008: Takeoff
2003
Rana Kapoor (with 2 Os) & Ashok Kapur (with an U) start Yes (not a no) Bank.
Kapoor is very aggressive while Kapur is conservative.
RBI likes Kapur but not Kapoor.
After spending over half a decade in securing funding, brothers-in-law Rana Kapoor and Ashok Kapur find themselves signing the certificate of commencement for their new business - a brand new bank named Yes Bank. Things seem bright with confident investors and years of business knowledge behind them.
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The catch? Rana Kapoor is much more aggressive as a banker than his co-founder. Guess which one the RBI prefers? (Hint: Itâs not Rana.)
2008-2017: One Engine Down
2008 - 2017
Kapoor to himself, âKabhi kabhi lagta hai apunich bhagwan haiâ.
Kapoor starts giving loans at higher interest rates to bad people & companies.
He takes upfront loan fees from them. Uses this money to run the Bank.
Kapur & Kapoor families get into a big fight
Smooth sailing followed the bank for close to a decade - by 2011, Yes Bank was in 164 cities across India and growing rapidly. Unfortunately, in that very same year during the 26/11 terrorist attacks, co-founder Ashok Kapur was gunned down along with 165 other innocents.
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With no one else to help steer the wheel, the remaining Kapoor found himself veering towards his aggressive, expansionist banking strategy, and before long, Yes Bank was giving high-interest loans to unreliable customers and companies. The upfront loan fees were used to run and expand the bank. The Kapur and Kapoor families got into personal fights because of this.
2017-2018: What Goes Upâ¦
2017
Kapoor becomes a billionaire. Bloomberg says to Kapoor, âJahapanah! Tussi great ho!â.
But the RBI is not happy with Kapoorâs Bank. (RBI is never happy).
RBI starts spying on Yes Bank.
By mid-2018, Yes Bank became incredibly successful off Kapoorâs strategy, making the banker a bonafide billionaire despite the health of his customer base. The founder was rolling in wealth while the bankâs stock price shot up to an all-time high of Rs 393 - while the banking industry showered praise and awards on account of their âsuccess storyâ.
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The RBI, however, wasnât exactly buying it. Soon, the Reserve Bank begins to keep an eye on Yes Bankâs business.
September 2018: â¦Must Come Down
September 2018
RBI says, âRishte me toh hum tumhare baap lagte hai aur naam hai RBI.â
RBI orders Kapoor to get out & Yes Bank to find a new CEO.
Yes Bankâs shares tank & it loses shit load of money.
Finally, the RBI had had enough. With Yes Bank slyly modifying the numbers behind many of their bad loans, they finally get a much-needed reality check.
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This comes in the form of a letter from RBI - ordering Kapoor to step down and the bank to get a new CEO. Soon, the bankâs shares begin to plummet.
October 2018 - November 2018: On A Sinking Ship
November 2018
A chairman, 2 independent directors & an external walk out of Yes Bank.
Yes Bank says, âIt is all okay. We are looking for new bosses.â
But Moodyâs gives Yes Bank very bad rating (important rating)
Desperate, Kapoor asks the RBI for more time, but the RBI gives zero fucks as they donât trust Kapoor. Evidently this was the right idea, as the companyâs profit margins come severely below their estimates. The reason? Yes Bank had given a bad loan to a company that wasnât able to pay.
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The result is immediate and swift - within a month, a chairman, 2 independent directors & an external resign. The bank defends this by claiming that theyâre âlooking for new managementâ. Right.
March 2019 - August 2019: From Bad To Worse
March 2019
New CEO. Bankâs shares go up.
(All happy⦠but wait)
RBI slaps fine on Yes Bank for non-compliance. (This is bad news)
By March, Yes Bank finally finds a new CEO in the likes of Ravneet Gill, an experienced banker who jumped ship from Deutsche Bank. Sure he regrets that now, but for a while, his addition saw the bankâs shares jump towards healthier trends.
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It was all for naught, though. After being slapped with a fine for non-compliance from the RBI, SEBI corners the bank for insider trading allegations. If that wasnât bad enough, the quarterly reports have little to show other than major losses, further lowering the share price, while yet another fine comes slamming onto the bankâs already overflowing desk - the bank now owes over Rs. 1 crore in just fines.
By August, the upper management has shuffled around, stocks have fallen to laughable levels and a new CFO has been hired to somehow fix this mess.
August 2019 - January 2020: Nearly Finished
Nov 2019
Yes bank says a Hong Kong investor is ready to give a shit load of money.
Quarter Results: Losses losses everywhere!
After several (probably depressing) meetings where the management had to stare at abysmal losses, there comes in a ray of hope for Yes Bank - according to their executives, a top tier Hong Kong investor is ready to pump in some much needed investment to keep the company afloat.
© Reuters
Soon enough, it turns out that said investor is facing legal troubles. People begin to worry that the bank will have to merge with another organization.
Present Day: Sab Moh Maya Hai
Yes bank becomes 2 rupees (per share) bank.
â Pratiksha Dake (@PratikshaDake) March 6, 2020Yes another board member resigns and burns bridges by telling SEBI that Yes Bank is up to further legally questionable activities. Meanwhile, the bank says that they wonât be looking for investors anymore.
© Reuters
RBI has finally reached the last straw with Yes Bank - after years of conflict, it finally steps in to take the reins. A limit of Rs. 50,000 was imposed on withdrawals, the SBI was instructed to form a group of companies, each buying out stakes in Yes Bank.
The share price falls below Rs. 10, and the sun finally sets on what was once Indiaâs most-promising new bank.
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