Reserve Bank of India has placed Yes Bank under moratorium

The Reserve Bank of India has placed Yes Bank under moratorium. Yes Bank customers cannot make regular withdrawals of more than Rs. 50,000 a day till April 3, subject to a maximum of Rs.5 lakh.

Daily Current Affairs Quiz 2020

Why the Yes Bank fall into the crisis?

• Many borrowers started defaulting the bank’s gross non-performing asset (NPA) percentage that is the percentage of loans overdue for more than 90 days.
• The bad loans piled up, the bank did not make enough provisions in its profits. Its provisions were the lowest among comparable banks.
• The Customers withdrew large amounts, resulting in the credit-deposit ratio crossing 100% in 2018-19. That is, it lent more than it received.