Prashant Kumar, the CEO of Yes Bank, explained one of the major drags on the bank’s profitability has been themoney invested in RIDF (Rural Infrastructure Development Fund) to make up forthe shortfall in mandatory rural obligations. By March 31, there was no shortfall which means no additional funds will need to be invested in RIDF going forward. Approximately 25% of the funds invested in RIDF, around Rs 11,000 crore out of a total of Rs 44,000 crore, will start coming back to the bank in the current financial year. The bank continued to be in the lookout for a microfinance company to acquire to meet its rural targets but was being careful on valuations and assetquality.

Kumar said that the bank’s core equity is currently at 13.3%, which is quite a healthy level and means they do not need any additional capital for growth purposes in the current financial year. However, capital may be required to fund growth plans in the next financial year. While the bank has approval to raise up to Rs 2,500 crore in tier-2 capital.

Reference: Reference: https://timesofindia.indiatimes.com/business/india-business/retail-loan-stress-may-remain-high-in-sept-quarter/articleshow/113754128.cms 1/90