Yes Bank: Rescue,Revive,Restore

Abstract

The case examined the rise, crisis, and subsequent turnaround of Yes Bank, a prominent private-sector bank in India. Established in 2004 by a group of former bankers, the bank experienced rapid growth and emerged as a significant player in the Indian banking sector. However, by March 2020, it faced a severe financial and governance crisis driven by regulatory lapses, weak risk management, and compliance failures, ultimately requiring intervention by the Reserve Bank of India (RBI).

The RBI-led rescue involved restructuring of ownership, capital infusion, and the appointment of a new management team headed by Prashant Kumar, former Chief Financial Officer of State Bank of India. Under the reconstituted board and leadership, the bank demonstrated measurable improvements in capital adequacy and liquidity. Following losses in FY2020 and FY2021, Yes Bank returned to profitability in FY2022 and sustained this trend through FY2023 and the first 9 months of FY2024.

Despite this recovery, the bank’s profitability remained subdued relative to its historical performance and that of its industry peers. Recognizing this gap, management developed a strategic roadmap to improve profitability and operational efficiency. The case culminated in a decision point where Kumar had to prioritize and execute strategic initiatives within a constrained timeframe to restore the bank’s competitive position and long-term sustainability.