SBI Cards IPO: Yes Bank customers' may not get SBI Card IPO shares allotment; here's why
SBI Cards IPO: Yes Bank customers' may not get SBI Card IPO shares allotment; Here's why
SBI Cards IPO Allotment: Troubles for depositors' of crash-strapped Yes Bank has not ended yet as among many hits could be investors who have applied for SB Cards IPO. After RBI's restrictions on withdrawal of funds, now it is being wondered how all those applications in the SBI Cards IPO made via Yes Bank will be handled.
According to a report in Business Standard, investors who have applied for SBI Cards’ initial public offering (IPO) will be given an allotment of the shares with the condition that will make the payment using a different bank account before Friday. Following which it has raised the question that whether Yes Bank’s clients would be considered for allotment, in light of the 30-day moratorium imposed by the Reserve Bank of India.
The allotment for the Rs 10,300-crore share sale was finalised on Wednesday. Around Rs, 1,500 crores worth of bids in the IPO has come from YES Bank accounts. So, the Yes Bank customers may not have made a payment on time.
Meanwhile, Sebi also has been reviewing the situation and looking for a solution, as several investors applied for SBI Cards IPO, using Applications Supported by Blocked Amount (ASBA) facility, UPI and cheques.
RBI placed the capital-starved Yes Bank under a moratorium on Thursday, and put a Rs 50,000 per account withdrawal limit from all Yes Bank accounts. To be noted, the payments for SBI Cards IPO is slotted to be debited from investors' accounts by Wednesday, after the allotments are completed by the merchant bankers.
And, ASBA, which is blocked by RBI till the allotment of shares, is a process where the amount for which an investor applies in an IPO.
According to TOI sources, ASBA worth nearly Rs 1,400 crore from Yes Bank had come in the SBI Cards IPO. In addition, there were about 5,900 applications through UPI through Yes Bank, worth about Rs 19 crore.
TOI reported quoting sources that Yes Bank has already accepted all the applications and blocked the amounts in the respective customer accounts. The withdrawal restrictions will remain in place until April 3, 2020.
“The RBI decision has a cascading effect on trading members and their clients at large since they may not be able to cover their positions from their own funds. Thus, many Yes Bank clients may face serious financial problems,” said the letter was written to the central bank by the association members.
