Yes Bank crisis: 'Don't approach courts immediately'
Reacting to the Yes Bank crisis, senior advocate Vikas Pahwa on Monday advised investors and depositors not to approach the courts immediately.
"At this stage my advice to investors would be to wait and watch and do not approach any court which may create a situation of panic," Pahwa told IANS.
He further stated that Yes Bank in crisis is a great concern for people of the country.
"When a bank fails, millions of lives are affected. The RBI has to be extremely careful in dealing with this matter, as this may have a chain reaction. The government has to adopt drastic measures to uplift the economy," Pahwa said.
Speaking further on the issue, the senior advocate stated, "Unfortunately we don't have a robust banking resolution mechanism in our country. In my experience whenever the ED is involved in any matter, the chances of resolution become bleak. The ED normally takes hasty steps to attach the properties without appreciating the impact of the same on the going concerns."
"Before ED initiates any process of seizure or attachment of properties, the RBI should have a pragmatic look at the same and assure the protection of interest of the investors in the bank. This issue should be delicately handled," he said.
Recently, the RBI superseded the Yes Bank board for 30 days and appointed an administrator, putting a cap of Rs 50,000 on withdrawal by account holders for a month.
The RBI said that the bank's board was superseded "owing to serious deterioration in the financial position of the bank".
The CBI on Sunday also registered a case against the former MD and CEO of Dewan Housing Finance Limited (DHFL) as well as its promoter Kapil Wadhawan on charges of corruption.
The CBI has recently taken over the investigation into the Rs 2,267-crore Employees' Provident Fund fraud in Uttar Pradesh, where hard-earned savings of power sector employees were invested in DHFL.