Yes Bank crisis: FM Nirmala Sitharaman says RBI to come up with reconstruction plan, SBI willing to invest

Yes Bank crisis: Finance Minister Nirmala Sitharaman on Friday assured the depositors' interests are safeguarded and added that the Reserve Bank of India will come up with a reconstruction plan for Yes Bank within the moratorium period. She added that country's largest lender State Bank of India has expressed its willingness to invest in Yes Bank. 

"RBI has assured that the reconstruction plan will come into play within the moratorium period; SBI has expressed willingness to invest in Yes Bank," the finance minister said, during a press conference on Friday evening. Sitharaman said that she has asked RBI to assess what has caused these difficulties for the bank and clearly identify the roles played by various individuals in creating the problem and not addressing it.

"Our govt is committed to ensuring that depositors' interests are safeguarded. I want RBI to ensure that due process of law is set to roll with a sense of urgency so that we should find out as to who led to the problem of this size & magnitude," Sitharaman said. 

On what went wrong in Yes Bank, the FM said that investigating agencies too found irregularities in Yes Bank. The finance minister has asked RBI to act so that the due process of law takes its course with a sense of urgency.

WATCH | Nirmala Sitharaman's full press conference 

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Earlier in the day, the Finance Minister had assured depositors that their money is safe and said the central bank was working for an early resolution of the crisis.

"I am in continuous interaction with the RBI. The RBI is fully seized of the matter and has assured they will give a quick resolution," Sitharaman had said while adding that no depositor will lose his or her money and insisted that the immediate priority is to ensure Yes Bank customers are able to withdraw money within the stipulated cap.

"I want to assure every depositor that their money shall be safe. Their monies are safe," she said. "I am constantly in contact with the RBI and the steps that are taken are taken in the interest of depositors, banks and economy. We are fully seized of the development."

On Thursday evening, the Yes Bank was placed under a moratorium with the RBI capping deposit withdrawals at Rs 50,000 per account for a month and superseding its board. The order means that Yes Bank will not be able to grant or renew any loan or advance, make any investment, incur any liability or agree to disburse any payment. Over the next month, the bank will be led by RBI-appointed administrator Prashant Kumar, an ex-chief financial officer of SBI.

The last lender to be placed under a similar action was PMC Bank in September last year. The withdrawal limits from the bank have been increased over time to Rs 1 lakh now. RBI superseded the board of Yes Bank for a period of 30 days "owing to serious deterioration in the financial position of the bank".