Published 10:36 IST, March 13th 2020
Odisha govt distances itself from Jagannath Temple's deposit in crisis-hit Yes Bank
The Odisha government on Thursday clarified that they had no role in the Shree Jagannath Temple Administration (SJTA)'s deposit in the crisis-hit Yes Bank
The Odisha government on Thursday clarified that they had no role in the Shree Jagannath Temple Administration (SJTA)'s deposit in the crisis-hit Yes Bank. According to the Odisha government, the decision was taken by the temple's managing committee, and they do not interfere in it.
Speaking in the Assembly session, State Finance Minister Niranjan Pujari said, "Yes Bank was selected through a transparent process for the deposit. Proposals were invited from scheduled commercial banks by way of quotations by the temple administration for the deposit of Rs 545 crore."
He further added that "Yes Bank had assured an interest rate of 8.61 per cent per annum."
Yes Bank crisis
Yes Bank started facing a crisis as it accumulated many bad loans in 2018 by lending to corporate defaulters such as DHFL, Jet Airways and Cafe Coffee day, among others. Moreover, when RBI refused to extend the term of founder Rana Kapoor as chief executive in 2018, its management was severely hit with his successor Ravneet Gill managing to raise only one round of funds through a share sale to institutional investors. In a bid to revive the bank, Gill has been in talks over the past 18 months with equity investors, but could not come up with a concrete investment plan.
RBI takes over Yes Bank for 30 days
On March 4, RBI appointed former SBI CFO Prashant Kumar as administrator for Yes Bank and imposed a moratorium on the troubled lender, capping its withdrawals at Rs 50,000, for a period of 30 days. The RBI stated that the decision was taken to a serious deterioration in the financial position of the bank and has been done to restore depositors' confidence in the bank. Yes Bank has also cancelled all fund withdrawal requests made by clients to their YES bank accounts and its stocks tumbled by 10%.
Updated 10:36 IST, March 13th 2020