Mumbai: Yes Bank Ltd on Tuesday said that it had partly disclosed the divergence report because the Reserve Bank of India (RBI) had said that no other part of the risk assessment report can be made public. Besides, since theRBI risk assessment report was confidential, it cannot share it in full unless the central bank permits it, it added.
Yes Bank was responding to clarifications sought by NSE regarding an earlier RBI letter, which had questioned the bank’s intent in issuing a press release on “nil divergence" in asset classification and provisioning. RBI had also observed that the risk assessment report identifies several other lapses and regulatory breaches in various areas of the bank’s functioning and, therefore, the disclosure of just one part of the report will be viewed as a deliberate attempt to mislead the public.
“Moreover, nil divergence is not an achievement to be published and is only compliance with the extant Income Recognition and Asset Classification (IRAC) norms," the lender had said in a regulatory filing last Friday, citing the RBI letter.
The bank also said the confidentiality clause does not allow it provide any further details even to the stock exchanges, unless allowed by the RBI.
Yes Bank said a few of its peers have submitted the information pertaining to divergence to the stock exchanges, along with their quarterly results, much ahead of the finalization of their annual results. It added that given its past disclosures on divergence, it was receiving queries from various stakeholders on the compliance with the central bank’s IRAC guidelines for the period ended 31 March 2018.
Citing the Securities and Exchange Board of India’s (Prohibition on Insider Trading) Regulations on unpublished price sensitive information (UPSI), the bank said it was of the view that the disclosure pertaining to divergence was a UPSI, and required prompt dissemination to the stock exchanges in order to ensure compliance with Sebi regulations.
“The bank has not made any undue advantage or benefit by disseminating the UPSI. Hence, we humbly submit that the bank has not misrepresented or mislead the stock exchanges/ investors in terms of Regulation 4(1)(c) of Listing Regulations," it said.
After the disclosure on 13 February, Yes Bank shares gained 28.96% to ₹218 on 14 February. At the day’s close on Tuesday, it was trading at ₹212.45 on the BSE, down 0.33% from its previous close.