Yes Bank boosts target capital to $2 billion after receiving pledges from new investors

Yes Bank boosts target capital to $2 billion after receiving pledges from new investors

Yes Bank Ltd. boosted its target for a capital raising to $2 billion after commitments from new investors. The company, which is India’s fourth-largest private lender, has been caught in the country’s deepening banking crisis.

Yes Bank said at a meeting on Friday that its board had signed off on the capital increase, which was higher than its previous figure of $1.2 billion. Investors includes Canada’s Erwin Singh Braich, SPGP Holdings, and Citax Holdings Ltd. that had “individually expressed their agreement/willingness to subscribe to equity shares,” according to a stock exchange filing.

The board will meet again on Dec. 10 to approve a preferential allotment of shares to investors, none of which will receive more than a 25% stake in the bank.

Yes Bank needs to raise new capital after being forced to step up provisioning against bad loans. This includes to some of the non-bank lenders caught up in the country’s shadow banking crisis. The lender’s core equity capital is 8.70%, barely above the regulatory minimum of about 8%.