Deals
India’s Chaotic Bank Seizure Sends Shockwaves Through Markets
- Yes Bank shares drop as much as 85% and Sensex tumbles
- RBI Governor Das says India’s banking sector ‘sound and safe’
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India’s attempt to buttress its financial system by taking control of the country’s fourth-largest private lender has instead triggered widespread confusion and signs of investor panic, adding a fresh layer of risk to an economy that’s already headed for its weakest expansion in more than a decade.
The seizure of Yes Bank Ltd. by India’s central bank late Thursday was the nation’s biggest such intervention in at least 13 years. Speculation of a government rescue had been swirling for months, but the announcement unnerved markets by leaving several key issues unresolved, including the fate of depositors, creditors and shareholders.