November 28, 2018 / 9:16 AM / 5 months ago

Yes Bank slumps after media report on transactions by CEO's investment firms

A watchman steps out of a Yes Bank branch in Mumbai, September 21, 2018. REUTERS/Francis Mascarenhas/Files

(Reuters) - Yes Bank Ltd shares fell 11 percent to close at a 20-month low on Wednesday, after a media report said investment vehicles of the lender’s chief executive made transactions that could be questioned by investors and regulators.

Yes Capital, owned by Yes Bank CEO and shareholder Rana Kapoor, borrowed money from the market and invested that into another one of his investment vehicles, the Economic Times said citing sources who did not want to be identified.

Yes Bank denied involvement with the fund management of these investment vehicles.

The ultimate beneficial ownership of these investment vehicles rests with Yes Capital, which also owns shares in Yes Bank, the Economic Times stated, citing sources.

“Bank has no dealings with these two companies except to the extent that Yes Capital (India) Pvt Ltd and Morgan Credits Pvt Ltd, being promoter group entities,” the lender said, referring to two of its shareholders.

Yes Bank stock has nearly halved this year, including Wednesday’s losses, hammered by recent reports questioning the use of investor money by the bank and a decision by India’s central bank to cut short Kapoor’s term as CEO till Jan. 31, 2019.

Reporting By Arnab Paul in Bengaluru; Editing by Sayantani Ghosh and Himani Sarkar

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