Yes Bank shares fell nearly 4 per cent on Thursday, a day after credit ratings agency Moody’s Investors Service said it had placed private sector lender’s rating under review for a downgrade. Moody’s said the review was driven by two factors: Yes Bank’s weak financial performance in the quarter ended September 30, and the announcement that it had received a $1.2-billion binding offer from a global investor via new equity capital. Moody’s currently has a foreign currency issuer rating of “Ba3” on Yes Bank.
On the Bombay Stock Exchange (BSE), Yes Bank shares fell as much as 3.92 per cent to an intraday low of Rs. 66.05 apiece. On the National Stock Exchange (NSE), Yes Bank shares opened lower at Rs. 68 apiece and dropped to as much as Rs. 66 apiece during the session, marking an intraday decrease of 3.93 per cent.
Moody’s said the bank’s weakening financial position can be somewhat offset by the planned raising of capital. “There are significant execution risks around the timing, price and regulatory approvals required,” the agency said.
During the review period, Moody’s said, it will focus on Yes Bank’s ability to raise new equity capital. “An inability to raise the planned equity capital will negatively impact Yes Bank’s credit profile and ratings,” the credit ratings agency added.
At 11:45 am, Yes Bank shares traded 1.45 per cent lower at Rs. 67.75 apiece on the BSE, underperforming the benchmark Sensex index which was up 0.11 per cent