March 15, 2020 / 6:30 AM / 14 days ago

Troubled Indian lender Yes Bank reports wider-than-expected loss

MUMBAI, March 15 (Reuters) - Troubled Indian lender Yes Bank reported a wider-than-expected quarterly loss of 185.6 billion rupees ($2.5 billion), and said it was continuing to analyse the allegations of wrongdoing by former Managing Director Rana Kapoor.

The loss, as reported in a filing late on Saturday, was significantly wider than the 5.7 billion rupees expected by analysts, according to Refinitv data. For the quarter a year ago, it had turned in a profit of 10.02 billion rupees.

The results come after India approved a rescue plan for the lender, once considered a rising star after it was set up in 2004 but now struggling with bad loans. Earlier, the Reserve Bank of India placed it under a moratorium, restricting deposit withdrawals and superseded its board.

The authorities have also opened investigations into Yes Bank’s lending practices that led to its failure, while its founder Kapoor was detained and a case of money laundering registered against him.

The lender’s asset quality took a severe beating in the quarter, with gross bad loans as a percentage of total loans rising to 18.87% as of December-end, from 2.1% a year earlier.

Provisions also jumped to 247.66 billion rupees, from 5.5 billion rupees a year ago. The bank said its deposits had dropped by 26% to 1657.55 billion rupees, while advances were down 24% at 1860.99 billion rupees.

The capital adequacy ratio of the bank stood at 4.1% for the quarter, while its Core Equity Tier 1 ratio (CET1) was 0.6% - much lower than the regulatory requirements of 7.375%.

In February, the bank said it would delay its third-quarter results by at least a month as it focused on raising capital. ($1 = 73.8390 Indian rupees) (Reporting by Nupur Anand; Editing by Himani Sarkar)

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