Higher Foreign Investment Cap To Boost Global Capital: Yes Bank

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New Delhi: Yes Bank on Thursday said approval by the government to hike the foreign investment limit to 74 per cent will enhance the private sector lender’s flexibility in raising capital at a global level going forward.

It is expected to bring in foreign direct investment (FDI) of the order of $1 billion (Rs 6,885 crore) into the bank.

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday allowed the bank to increase foreign investment limit to 74 per cent, from 41.87 per cent earlier.

“The increase in limit will provide Yes Bank with significant enhanced flexibility in global capital raising, going forward. Yes Bank already has an enabling approval from its board of directors to raise an additional $1 billion of equity capital,” the bank said in a statement on Thursday.

The hike in investment limit comes without any sub-limits.

The modes of instruments for investment include qualified institutions placement (QIP) of equity shares or issue of ADRs/GDRs (American depository receipts/global depository receipts) and/or QFIs/FPIs (except NRIs) under the portfolio investment scheme by acquisition of permissible securities on stock exchanges.

Yes Bank said it has become the first bank in India to receive such an approval for a fully fungible composite foreign investment limit of 74 per cent.

The hike in overseas shareholding was notified by the Cabinet in 2015 in order to remove sub-ceilings for multiple investor categories of FII, FDI and FPI.

Shares in Yes Bank, on Thursday, ended 2.93 per cent higher at Rs 1025.40 apiece on the BSE, whose benchmark Sensex index finished 1.88 per cent up.