Yes Banking moratorium: Credit companies can keep Rating pat for borrowers

MUMBAI: The Reserve Bank of India has allowed credit ratings companies and credit bureaus to maintain the creditworthiness of borrowers whose payments were delayed due to a two-week period; moratorium it had imposed Yes Bank in March.

The non-state lender, for its part, does not report such clients to these institutions. The relaxation provided by the central bank covers corporate customers, MSMEs and retail customers.

“Anyone who has not been able to pay due to the moratorium, we have made sure not to report them to the credit rating agencies,” said Yes Bank CEO Prashant Kumar. “Customers cannot be punished for it.”

Credit rating agencies and credit bureaus have also received an intimation from Yes Bank.

“We are not downgrading the borrowers who missed payments due to the moratorium imposed on Yes Bank by RBI. We have received intimation about this from the banks and have already taken them into account in our future rating actions, ”said a senior official at a rating company.

The RBI had introduced the moratorium on March 5 and limited withdrawals to Rs 50,000 per month. Deposits after a sharp withdrawal and bad loans wiped out part of the lender’s capital. The curb was withdrawn on March 18.

Yes Bank has been rescued by a state bank of Indian-led consortium with a stake of almost 11,000 crore. Others in the consortium included HDFC Bank, Axis Bank, ICICI Bank and Kotak Mahindra Bank.

The lender had witnessed a quiet mini-run on its deposit base since last October. Deposits totaling nearly Rs 2.09 lakh crore at the end of September halved to Rs 1.05 lakh crore at the end of March 2020.

Its deposits loan was over 160%, which means that for every Rs 100 of deposits, it borrowed Rs 160, backed by loans from the market. Pr. As of March 31, the loans were $ 66,000 more than the deposits it had, legislative filings show.

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