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Yes Bank is a private sector bank in India with a balance sheet size of ₹ 3.4 lakh crore as on December 2022.

• The bank has a footprint of 1145 branches across India
• Retail and SME comprise ~57% of total net advances

• As a part of RBI’s Reconstruction Scheme 2020, State Bank of India initially infused capital of ₹6050 crore for a ~48% stake in Yes Bank. Under this scheme, the minimum price was ₹10 per share and it also contained a lock-in period of 3 years till March 2023 for all investors where-in no one can sell old shares in secondary market for 3 years. Additionally, under this scheme State Bank of India must hold at least 26% until March 2023.
• State Bank of India’s original ~48% stake has reduced to ~26% as of December 2022 due to fund raising dilutions over time
• We expect Yes Bank share prices to remain volatile as the lock-in period (prohibiting shares sale) ended on 13th March 2023 as cash transfer happened on 14^th March 2020.

YES Bank announced Q1FY25 results:

• Net Profit for Q1FY25 at Rs 502 crore up 46.7% YoY & 11.2% QoQ
• NIMs for Q1FY25 steady QoQ at 2.4%
• Non-Interest Income for Q1FY25 at Rs 1,199 crore. Normalised growth at 20.5% YoY
• NIL PSL shortfall for Q1FY25 across overall requirement and sub-categories, through combination of further step up in organic balances and PSLC purchases
• Net Provision Costs lower by 41.2% YoY & 55.0% QoQ
• RoA for Q1FY25 at 0.5% v/s. 0.4% in Q1FY24 & 0.5% in Q4FY24
• Robust Deposit accretion (up 20.8% YoY)
• CASA Ratio flattish QoQ at 30.8% despite Q1 seasonality
• Net Advances Growth at 14.7% YoY aided by:
  • Sustained growth momentum in SME (at 23.8% YoY),
  • Mid Corporate Advances (at 25.0% YoY), and
  • Resumption of growth in Corporate segment (13.8% YoY growth)
• GNPA at 1.7%, NNPA at 0.5%, PCR at 67.6% (up 100 bps QoQ)
• (NNPA net carrying value of SR) as % of Advances continued to improve to 0.9% in Q1FY25 v/s. 2.4% in Q1FY24 and 1.1% in Q4FY24
• Strong Resolution momentum with recoveries/ resolutions at Rs 1,581 crore in Q1FY25
• During the quarter both CA Basque Investments and Verventa Holding Ltd. have exercised the outstanding Warrants- the proceeds resulting in 100 bps accretion to CET I%
• Global Rating Agency Moody’s Upgraded the Rating Outlook to “Positive” from “Stable” in July 2024. ICRA has also upgraded the Credit Rating on Bank’s instruments from A- to A

Commenting on the results and financial performance, Prashant Kumar, Managing Director & CEO, YES BANK said, “The Bank has started the financial year on a strong footing with RoA sustaining QoQ at 0.5% despite seasonality of Q1 and NIL PSL shortfalls. While the Income Engines are continuing to fire with normalised Net Income Growth at 15% YoY, the Bank has been able to contain the Operating Cost growth at 8.0% YoY (exPSLCs). At the same time, the resolution momentum continues to be strong, leading to lower Net Credit Costs, which is also aiding in RoA expansion.

On the Balance Sheet front, the Bank is effectively executing its strategic objectives of sustained momentum in SME and Mid- Corporate segments, resumption of growth in Corporate segment and calibration in Retail Assets with focus on profitability. Similarly, the Retail and Branch Banking led Deposits continue to grow at faster pace than Wholesale Deposits.

Other key highlights of the quarter were i) exercise of outstanding Warrants by the Private Equity Investors, and ii) Credit Rating Outlook upgrade by Moody’s and Credit Rating upgrade by ICRA- these external stakeholder validations reinforce faith & confidence in the growth and profitability expansion trajectory of the franchise.”

Result PDF