TV18 Exclusive | Yes Bank's value driven by digital focus and branch network, says Carlyle's Sunil Kaul

Sunil Kaul, Managing Director and Financial Services Sector Lead, Carlyle Asia

Yes Bank on July 29 announced a fund raising to the tune of $1.1 billion (Rs 8,900 crore) from private equity investors - Carlyle Group and Advent International, with both the PE firms seeking up to 10 percent stake each in the private lender via a mix of equity and warrants.

Speaking exclusively to CNBC TV18, Sunil Kaul, Carlyle Asia's managing director and financial services sector lead, said Yes Bank's value is driven by its "digital focus and branch network".

"The bank went through a rough time. And there is a management team which have shown resilience and went through the process to win back the confidence of market and consumers. For us, investment is about really putting money behind the people. And they (management) have demonstrated that they are putting their efforts to move in the right direction," Kaul told the news channel.

Carlyle, he said, is interested in asset management companies, wealth and general insurance in financial services for investments.

The deal with Yes Bank is expected to be completed in "4-10 weeks", the top Carlyle official noted. "There is a whole series of approvals we need...at that time, we will probably put in 70 percent of the money and the remaining 30 percent would come ... when the warrants are exercised," he added.

The deal has been structured in a manner that the State Bank of India's (SBI) stake does not fall below 26 percent till March 2023, Kaul said, further adding that Carlyle has sought board nomination as part of the deal.

Earlier in the day, Yes Bank said the fund would be raised through a combination of around $640 million (Rs 5,100 crore) in equity shares and around $475 million (Rs 3,800 crore) through equity share warrants.

It will issue up to 1.84 billion equity shares to Carlyle at Rs 13.78 per share.

The capital raise is subject to shareholders’ approval at the extraordinary general meeting of the bank scheduled on August 24, 2022.