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Last Updated : Jun 19, 2019 08:28 AM IST | Source: CNBC-TV18

Yes Bank CEO Ravneet Gill confident of full recovery from ADAG exposure

"I feel very comfortable about the recovery of that entire exposure that we have to the group (ADAG) and I have to say that the group is working overtime to make sure that those actions happen," said Gill.

CNBC TV18 @moneycontrolcom

Yes Bank is confident of full recovery from Anil Dhirubhai Ambani Group (ADAG), said Ravneet Gill, managing director and CEO of the company, in an exclusive interview with CNBC-TV18 on June 17. He, however, refused to disclose the exposure to the group.

"I feel very comfortable about the recovery of that entire exposure that we have to the group and I have to say that the group is working overtime to make sure that those actions happen," said Gill.

The lender has been reporting lacklustre financial results for the last few quarters due to massive exposure to struggling entities in infrastructure, airlines and real estate space.

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The company reported a massive net loss of Rs 1,507 crore in the period ended March 31 on the back of provisions against bad loans.

"We saw exposures where there were repayments coming out, we thought that cash flows may be insufficient to service those and we just decided to flat them pre-emptively. So what we actually did was go out there, be proactive and very transparent there much in advance rather than wanting to hold back some disclosures. So when you say there was a disconnect in the book we put out there… it is something that I find difficult to explain,” said Gill.

On exposure to Jet Airways, which suspended its operations after running out of cash, Gill said that the bank has taken 50 percent provision in Q4 while the remaining needs to be provided for.

Gill added that he expects complete resolution to DHFL exposure in a few weeks. He said that he wasn't too concerned about the timeline as long as resolutions happen.

The bank has been falling ever since UBS retained 'sell' call and cut the bank stock's target price last week.

"A lot of what we disclosed during the Q4 results was a move towards more prudential accounting, a move towards more openness and transparency and that is the reason why we put out a watchlist. So we always had a sub-investment grade book out there but for the first time we put out a watchlist and not only did we put out a watchlist, but we also went ahead and took some contingency provisions on that. What that shows is a desire on our part and intent on our part to be very open in terms of our engagement and be very transparent," added Gill.

Further, Gill said that the lender’s exposure to Videocon was zero and added that the market assuming exposure to the group was based on a misconception.

On June 12, Moody's placed the private sector lender's ratings under review for a possible downgrade citing its high exposure to the struggling sectors.

In addition, two members resigning from the board caused further concerns among investors. It was reported that the bank's recent exits came after former CEO and founder Rana Kapoor requested for a position back on the lender's board. However, Kapoor denied that he sought for a comeback on the board.

Reports have emerged that the lender is considering to raise funds through private investors. However, private equity investors Blackstone Group, Apax Partners and Warburg Pincus are seeking more details on the bank’s exposure to stressed loan accounts before finalising any decision on an equity infusion, Mint reported, citing sources.

Source: CNBC-TV18

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First Published on Jun 17, 2019 04:20 pm
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