Published 18:13 IST, March 6th 2020
Tirupati temple trust withdrew deposits worth Rs.1300 cr from Yes Bank months ago
As per reports, the Tirumala Tirupati Devasthanam (TTD) trust in Andhra Pradesh withdrew deposits worth Rs.1,300 crores from Yes Bank a few months ago.
As per a release, Tirumala Tirupati Devasthanam (TTD), the trust managing the famous Tirumala Tirupati temple withdrew deposits worth Rs.1,300 crore from Yes Bank a few months ago. This assumes significance in the wake of the RBI’s decision on Thursday to impose a moratorium on Yes Bank. Reportedly, the TTD deposited its funds with 4 banks including Yes Bank during the tenure of the TDP government.
After assuming charge as the new TTD chairman, YV Subba Reddy asked for a comprehensive report of the financial position of the 4 banks. Thereafter, he directed the immediate withdrawal of the deposits from Yes Bank citing its financial crisis. Reports indicate that Andhra Pradesh CM YS Jagan Mohan Reddy consented to the decision once the matter was brought to his notice.
The Yes Bank crisis
On Thursday, the RBI imposed a moratorium on Yes Bank, superseding its Board of Directors. In the meantime, former Chief Financial Officer of SBI Prashant Kumar has been appointed as the administrator for Yes Bank. The withdrawals for customers have been capped at Rs.50,000.
However, an exception can be made on the grounds of a medical emergency, higher education costs, marriage expenses, and unavoidable emergency. The RBI not only assured the customers but also promised to draw a scheme for the bank’s reconstruction or amalgamation within the 30-day moratorium period. The RBI has cited Yes Bank's “inability to raise capital to address potential loan losses” and “serious governance issues” as some of the reasons for taking action.
'In-principle approval of SBI investment'
Earlier in the day, SBI Chairman Rajnish Kumar confirmed that an in-principle approval of investing in Yes Bank had already been communicated to the stock exchange. Asserting that there was no need for the customers to panic, he said the interest of all stakeholders would be protected. Maintaining that the RBI was taking appropriate steps for financial stability, he refused to reveal further details of the SBI’s plan vis-à-vis Yes Bank.
The SBI Chairman said, “Earlier, RBI Governor has very clearly said that there is no need for panic. The interest of all stakeholders particularly all the customers will be protected. So, what else do you want? We have given the information of in-principle approval of SBI investment to the stock exchange yesterday night. I will tell you when the time arises. RBI said that they will come out with a restructuring plan. So, let that come, then we will talk.”
Updated 18:13 IST, March 6th 2020