
YES Bank shares shall continue to remain under spotlight on Wednesday amid the reports that the leading private lender has initiated a formal search for its new chief executive office (CEO), reported Moneycontrol citing sources. The board has engaged global recruitment firm Egon Zehnder to run the process, it said.
This is a rather recent development at the bank, said a highly placed source on the condition of anonymity. YES Bank's current MD and CEO Prashant Kumar has played a pivotal role in bringing stability into the bank and for the job done, he may be offered an extension for at least an year, if the search process does not lead to desired outcome, said the report.
On the other hand, YES Bank has made three changes in its senior management on Tuesday, May 13 as it has appointed Santosh Mishra as Business Head PSL and Microfinance, Mukesh Kumar as National Head Project Finance and Loan Syndication and Ashish Dadhich as Country Head Financial Institutions
To recall, Prashan Kumar's three-year tenure as YES Bank MD and CEO is set to end this October and the board has not yet decided for his extension. Reserve Bank of India (RBI), the banking regulator, usually takes up to 3-months to approve the senior leadership in banks. Also, boards take a call on CEO appointments at least 6 months prior to the conclusion of existing tenure.
YES Bank's top management is likely to be overhauled after Sumitomo Mitsui Banking Corporation (SMBC) is set to acquire 20 per cent stake in the private lender from State Bank of India and a set of private lenders. The Japanese-financial behemoth is set to approach the RBI with its proposal to take 51 per cent ownership control in YES bank.
SMBC has the right to nominate two directors, while SBI would have the right to nominate one non-executive and non-independent director.
Meanwhile, shares of YES Bank settled at Rs 20.87 on Tuesday, rising 2.30 per cent for the day. The private lender commanded a total market capitalization close to Rs 65,500 crore. Shares of YES Bank have gained nearly 15 per cent in the last three trading sessions since the news of SMBC stake acquisition.
JM Financial and Kotak Institutional Equities have a 'sell' rating on YES Bank, with the target prices of Rs 15 and Rs 17 respectively. Among other brokerages, ICICI Securities and Nomura remain 'neutral' on the stock. They have target prices of Rs 16 and Rs 17 on the stock, respectively.