In what can be a relief to thousands of Yes Bank employees, Finance Minister Nirmala Sitharaman said on Friday that Yes Bank employees will continue to get salary. Yes Bank is currently in crisis and Reserve Bank of India has set a maximum withdrawal cap of Rs 50,000 for depositors.
"All employees of the reconstructed bank will continue in service with the same remuneration, terms and conditions of service for at least a year," she said.
Addressing a press conference after the RBI superseded the board of Yes Bank and placed withdrawal restrictions, she said the bank was being monitored since 2017 and developments relating to it were being monitored on a day-to-day basis.
Since 2017, the central bank noticed governance issues and weak regulatory compliance at Yes Bank, besides wrong asset classification and risky credit decisions, she said.
On finding risky credit decisions, the RBI advised change in management, she said.
Yes Bank shares tanked by over 55 per cent on Friday.
Due to the moratorium placed on Yes Bank by the RBI, the 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.
Nirmala Sithaman lashed out at UPA government and said that it was responsible for the current state of the Indian banking system.
(With PTI inputs)
Watch | Steps are taken in interest of depositors, bank and economy: FM Sitharaman on Yes Bank crisis