Yes Bank’s total NPAs at 8 pc, Moody’s warns of longer pain

Mumbai: Private sector lender Yes Bank has an overall stressed advance of 8 percent and new chief executive Ravneet Gill’s clean-up will keep profit under pressure for up to the next 18 months, ratings agency Moody’s warned.

However, looking beyond the near-term stress, Gill’s clean-up is positive, once the de-risking is completed, the agency noted. “We estimate that Yes Bank’s overall stressed assets are about 8 pc of its total loans, taking into account this new disclosure,” Moody’s said after the bank Friday reported its maiden loss of Rs 1,506 cr for March quarter.

Gross non-performing assets shot up to 3.2 pc, while Gill also marked out a Rs 10,000 cr portfolio as potentially stressed. Provisions on account of higher NPAs and also a contingent provision representing 20 pc of the Rs 10,000 -crore portfolio resulted in the losses, Gill explained.

The agency said the bank expects 50 pc of these potentially stressed loans to slip into NPAs and will provide more for the same going forward. The 8 pc dud loans include a gross NPAs of 4 pc which has been called out as potentially stressed, net standard restructured loans and security receipts of 0.8 percent of gross loans, the agency said.

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