Last Updated on Sep 29, 2021 by Manonmayi

YES Bank, a private sector lender, and six persons settled the case with SEBI over alleged selective asset quality disclosure. The six people were either involved in the decision making regarding the disclosures made on 13th Feb 2019, or a member of the Reputational Risk Management Committee (RRMC). This settlement cost them ₹ 1.65 cr. Besides the bank, the six persons included Niranjan Banodkar, Ashish Agrawal, Devamalya Dey, Sanjay Nambiar, Shivanand Shettigar and Rajat Monga.

The regulator, SEBI, conducted an investigation into the affairs of YES Bank in Feb 2019. This was to ascertain the possible infringement of provisions of the SEBI Act and Prohibition of Fraudulent and Unfair Trade Practices (PFUTP). As a result of this investigation, SEBI observed that the bank and six persons committed certain violations and hence, issued show cause notice (SCN) to them in Oct 2020.

The SCN showed that it was alleged that YES Bank made a selective disclosure on 13th Feb 2019, highlighting “nil” divergence, which created a positive impact on the price movement. Furthermore, they did not disclose additional vulnerabilities raised by the RBI in the Risk Assessment Report (RAR) such as lapses and regulatory violations in several areas of their operations.


This announcement mislead the investors that resulted in an increased price of the scrip by around 30% and the volume of scrip trading also increased the next trading day. But the applicants proposed a settlement of the proceedings initiated against them. Hence, SEBI’s committee suggested that the settlement of the case may be done upon payment of Rs. 1.65 cr by applicants on joint and several liabilities basis. And finally, SEBI settled the case.

Manonmayi
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

The blog posts/articles on our platform are purely the author’s personal opinion and do not necessarily represent the views of Anchorage Technologies Private Limited (ATPL) or any of its associates. The content in these posts/articles is for informational and educational purposes only and should not be construed as professional financial advice. Should you need such advice, please consult a professional financial or tax advisor. The content on our platform may include opinions, analysis, or commentary, which are subject to change, without notice, based on market conditions or other factors. Further, the use of any third-party websites or services linked on the website is at the user's discretion and risk. ATPL is not responsible for the content, accuracy, or security of external sites. Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI, membership of BASL (in case of IAs) and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. The examples and/or securities quoted (if any) are for illustration only and are not recommendatory. Any reliance you place on such information is strictly at your own risk. In no event will ATPL be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this website.

By accessing this platform and its blog section, you acknowledge and agree to the Terms and Conditions of this website, Privacy Policy and Disclaimer.