Yes bank

(jajushobhit) #326

Despite rest of the global markets falling the markets in the US have been gaining in the past 2-3 sessions is because the increase in import tariffs augers well for US companies. However this may lead to a trade war globally and as discussed in the article, Europe and other countries might adopt similar strategies in
retaliation. In my opinion this was the
reason for the sharp fall in our markets in last hour. I won’t be surprised if the US market correct in next 1-2 sessions.

(Chirag) #327

Based on the latest news feeds, fear about a trade war is already subsiding.

I am not sure what will happen in future. But fact remains that India has under-performed US and other emerging markets in 2018.

While many people attribute this under-performance to varied causes. I attribute it to two things:

  1. A great 2017 where almost everything became either fairly valued or over valued
  2. Very average Q3 numbers


In a group of hawks, doves, retaliators, bullies and prober-retaliators, when a dove fights a dove, they both make a lot of noise about doing this and that to the other knowing fully well that they will do damage to themselves in the process if they proceed and so the fight goes nowhere and ends without damage to anyone. When a hawk fights a dove, hawk wins and the dove loses but with minimal damage as it knows when to back-off. When a hawk fights a hawk, its blood until last-man standing.

When fights follow round after round in multiple iterations, one can have a memory of past actions and act accordingly. A retaliator will attack only if attacked. A prober-retaliator will start an offensive to test the waters and retaliate if there is retaliation or keep bullying. A bully will act like a hawk and when it meets a dove, will win always but when it meets another hawk, will run away.

With that background, Trump tries tariff on Steel and Aluminium imports. EU retaliates with tariff on Harleys, Levis and Bourbon and hits where it hurts - the American heartland. Now if the US and EU are both hawks, this could go on forever and could end up derailing international trade and globalisation but trade isn’t a zero-sum game and globalisation can be win-win (non zero-sum) which is why it has been successful so hawk-hawk strategy is improbable.

Now if Trump were a prober-retaliator and the EU retaliator, it would again be a similar to a hawk-hawk strategy leading to complete demolition. If Trump were the bully (most likely) and has met a hawk in the EU, in all probability, Trump will run away i.e reverse his stand. However, considering this is politics, this is in all likelihood a dove-dove fight with a lot of noise and no action - None of the tariff actions will be committed to paper and will go away after everyone has scored political points.

(jajushobhit) #329

@phreakv6 You have beautifully articulated the whole situation. It will be interesting to see how it eventually pans out.

(Storyteller) #330

A TREAT, your description of the drama. Thanks.


Yes bank is now a shareholder of Fortis on Forfeiture of pledged shares of Promoters.

(Parag) #332

I understand Yes Bank gave personal loans to Singh Brothers against pledge of Fortis Health Care shares. As Yes Bank had acquired 17% stake in the company, it is clear that the Singh Brother has not repaid the loan.

Has Yes Bank declared that loans as NPA and made adequately provisioned?

And what is the acquisition price for these shares for Yes Bank?

(Mahendra243) #333

given the fact that yields are rising…and yes bank seems to have a low casa ratio…will the cost of funds for yes bank raise and dent the profit spread ?

Any comments would be appreciated

P.S Invested heavily have 2K @ 350

(Parag) #334

There was a time, I guess 4/5 years back, Yes Bank was dependent on wholesale funds. Since then Yes Bank has transformed themselves and their CASA ratio is around 37-38%.

On top of that, they are raising money through different instruments (like MTN, which I am afraid I have no idea).

Over the next few years, they are looking to increase their NIM towards 3.9-4.00 percent in next 2/3 years, which seems achievable in my opinion. Due to current PSU banks condition, they are getting an entry into big corporate clients, which they were finding it difficult few years bank. Yes Bank believes they can grow upwards of 25% CAGR for few years, which seems plausible if they handle NPA issues reasonably in the short term.

However, in the short term, there are a few headwinds like recent RBI guidelines related to declaring NPA. Additionally, RBI highlighted NPA divergence for the year ending FY15/16 and FY17.

I guess Yes Bank would take (hopefully) extra care this time in making sure that divergence for FY18 is less.

In Summary, short-term looks cloudy, but they are one of the big beneficiaries of value migration from Public sector banks to private sector banks.

Disc- Invested, so the view could be biased.

(Mahendra243) #335

Thanks for your reply…Is there anyway we can know which sector does yes bank have most exposure rather have given more loans? now if you take all the NCLT cases are related to steel sector.but i think the biggest stress is in power sector…if they start assessing that more stress will be in the banks which have lend to power sector

(pranav25) #340

Plans to roll out the above solution to 2000 corporate clients.

(Susindar) #341

Financial sector is ripe for disruption. As expected now age financial behemoths like Yes Bank, Indiabulls Housing Finance and bajaj Finance are leading in this area. Like other sectors, disruptee would loose their pants and disrupters will lead the next leg of growth.