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Yes Bank looking for investors to set up asset reconstruction company

Yes Bank reported more than quadrupling of profit to Rs207 crore in the June quarter from  ₹45 crore a year ago on account of lower provisions and robust other income.Premium
Yes Bank reported more than quadrupling of profit to Rs207 crore in the June quarter from 45 crore a year ago on account of lower provisions and robust other income.

  • Yes Bank had earlier attempted to start an asset reconstruction company, but the proposal was turned down by RBI. The lender was expecting to transfer nearly Rs50,000 crore of bad loans to the ARC, as per a media report

MUMBAI : Private sector lender Yes Bank is looking to partner with investors to set up an asset reconstruction company (ARC) and has hired EY as its process adviser, according to a public notice on Wednesday.

“EY invites expressions of interest from interested investors with strong financial capability and possessing substantial experience in the distressed asset space, with whom the bank will partner in relation to the creation of an asset reconstruction company," the notice said.

The prospective investor would be the lead partner or sponsor of the ARC, and the bank will act as the other significant partner or sponsor.

Potential investors, including foreign institutional investors, foreign portfolio investors, private equity, venture capital funds, domestic and foreign investment institutions, asset management entities, among others, should have a minimum asset under management and funds deployed globally of at least $5 billion, it said.

They should also have demonstrated the ability to commit funds for investment in Indian companies or assets of about $500 million.

That apart, potential investors should have global experience of dealing in the distressed asset space and an established track record of the turnaround of stressed assets and meet the ‘fit and proper’ criteria as per the Reserve Bank of India (RBI) guidelines.

Yes Bank had earlier attempted to start an ARC, but the proposal was turned down by the central bank.

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