The gross NPA reported by Yes Bank as of FY19 was Rs 7,800 crore and the RBI said it should have been Rs 11,150 crore. So basically the central bank is asking for Rs 3,200 crore to be marked as gross NPA. At the net NPA that works out to Rs 2,200 crore more net NPAs compared to what YES Bank had taken as of March 31.

Fresh NPAs are provided only 15 percent in the first year and 25 percent in the next year. So the extra provisioning that would be needed is Rs 632 crore. As a result, the profit for last year goes down by that much amount.

What is YES Bank’s response? It said, out of the Rs 3,200 crore, Rs 2,000 crore was accounted for by just four companies. Of these four, Rs 1,000 crore was for three companies, which they had already disclosed in their BB. Even then, there is Rs 2,000 crore, which has not been explained and should have been taken as an NPA and was not. That could have been treated as bad news.

However, I think the market is looking at a couple of things. One is Rana Kapoor is definitely out. The second is the press release to the stock exchange announcing the divergence was accompanied by a declaration that capital raising details will be made known to the exchange by end of the month.

That is explaining perhaps the positivity and maybe also an acceptance that when something is supervisor approved, RBI approved, at least you can trust those numbers well and truly. Because for a better part of FY19 after Kapoor and his team was in the saddle, Ravneet Gill comes in only at the end to present the numbers. So to that extent, since that has been RBI approved, the market also could take heart from it, maybe this is a start of good news.