Disclosure of nil divergence in line with RBI guidelines, says YES Bank

After last week's warning by the RBI of regulatory action for disclosure of nil divergence report in violation of norms, private lender YES Bank on Tuesday denied such wrongdoing.

By BusinessToday.In  
Wednesday, February 20, 2019

After last week's warning by the RBI of regulatory action for disclosure of nil divergence report in violation of norms, private lender YES Bank on Tuesday denied such wrongdoing. The bank declared that a 'zero divergence' disclosure was executed, which adhered to listing regulations and ensured information symmetry.

Following the announcement by the private lender on February 14, that the RBI's Risk Assessment Report (RAR) had not found any divergence in asset classification and provisioning for 2017-18, the stock price for the bank skyrocketed 30 per cent. On February 15, the bank disclosed the RBI had criticised the lender saying it was an attempt to "mislead the public" and the RAR had "identified several other lapses and regulatory breaches".

The stock exchange had sought further clarification from the bank regarding the Risk Assessment Report for FY18. YES Bank clarified the information received under RAR regarding "divergence" was an Unpublished Price Sensitive Information (UPSI), which could be misused or leaked.

Regarding the report, the bank stated it had not indulged in any sort of misrepresentation, and that no misleading information was provided to the stock exchanges and the investors.

"The bank has not made any undue advantage or benefit by disseminating the UPSI. Hence, we humbly submit that the Bank has not misrepresented or mislead the stock exchanges/investors in terms of Regulation 4(1)(c) of Listing Regulations," it said to the NSE.

Other banking peers also submitted the information pertaining to 'divergence' to the stock exchanges along with their quarterly results ahead of finalisation of their annual results, YES Bank added.

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