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Yes Bank targets regional investors

Sunday, Oct 18, 2009

Gulf News

Yes Bank to raise capital from Gulf investors

Dubai India's Yes Bank, a new generation private sector commercial bank, is seeking to raise $200 million (Dh734.6 million) additional capital. The bank plans to raise a significant share of this from Gulf based investors who include some of the leading sovereign wealth funds and institutional investors.

"We are going for a Qualified Institutional Placement (QIP) of 30 million to 50 million shares to raise $150 million to $200 million in additional capital and we are in talks with some of the leading sovereign wealth funds from the region including a few from the UAE," Rana Kapoor, Yes Bank founder and managing director, told Gulf News.

The bank currently has a paid up capital of Rs3 billion after the issue of fresh capital through the placement. The total paid up capital is expected to go up to Rs3.5 billion.

Interest

"We have received preliminary interest from a number of institutions from the region and intend to distribute the new shares evenly among the new institutional shareholders in a range not exceeding one to 1.5 per cent each," Kapoor said.

Currently Kapoor holds a 33 per cent stake in the bank while the Netherlands-based Rabobank holds 18 per cent. Other major shareholders include institutional investors such as HSBC (4.5 per cent) Malaysian sovereign wealth fund Kazana (four per cent), Orient Global (4.99 per cent) and Templeton (4.5 per cent).

The bank recently allotted 1,186,200 equity shares with a face value of Rs10 each two weeks ago under the Joining Stock Option Plan One (JSOP-I), Joining Employee Stock Option Plan Two (JESOP-II), Joining Employee Stock Option Plan Three (JESOP-III), Performance Employee Stock Option Plan One (PESOP-I) and Performance Employee Stock Option Plan Two (PESOP-II).

Yes Bank has plans to expand its reach to UAE-based Indian expatriates who are a source of at least $10 billion in annual remittances to India.

"We are looking forward to [having] some kind of presence in the UAE in the near future. Ideally, we are looking at a branch office based at the Dubai International Financial Centre to directly interact with our customers in the UAE and the Gulf region," he said.

Yes Bank recently entered into a tie-up with Mashreqbank to offer exclusive banking services to Mashreq 's NRI gold clients.

Strong results

Despite the financial crisis, the bank had reported strong results during the last two quarters with Rs830 million and Rs1 billion net profits respectively.

While the current capital adequacy is at 17.6 per cent, the bank is expecting a 30 per cent asset growth in the second half of the year.

The bank plans to grow it asset size to $30 billion by 2015 from the current $7.5 billion and expand its branch network of 125 to 750 branches and 3,000 ATMs.

By Babu Das Augustine, Deputy Business Editor

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