Yes Bank Undertakes Layoffs Amid Restructuring Efforts
Yes Bank has laid off 500 employees as part of an internal restructuring initiative, with further layoffs anticipated in the coming weeks, according to media reports. The layoffs have impacted various sectors, including wholesale and retail banking, with the branch banking segment being notably affected. All affected employees have been provided with three months’ severance pay. This move comes at a time when most private lenders are expanding their workforce.
Last year, Yes Bank‘s operating expenses rose by 17%, totaling Rs. 3,774 crore spent on staff. By the end of the last financial year, the bank employed 28,000 people, with 23,000 classified under junior management. The restructuring aims to enhance efficiency and reduce operating costs for the private lender.
Previous Restructuring in 2020
Yes Bank underwent a similar restructuring process in 2020 following the appointment of current Managing Director Prashant Kumar. This restructuring followed a rescue effort led by the Reserve Bank of India to prevent the bank’s collapse, during which several senior staff members departed.
Financial Performance and Challenges
Yes Bank, with State Bank of India as its largest shareholder, has been working to enhance its operating profits. By the end of FY24, the bank achieved a 6.4% increase in operating profit, amounting to Rs 3,386 crore, up from Rs 3,183 crore the previous year. This improvement indicates efforts toward stabilizing and strengthening the bank’s financial position under its current leadership.
Founder Rana Kapoor’s Legal Troubles
In April this year, Yes Bank founder Rana Kapoor was released from prison in Mumbai after being granted bail in an alleged loan fraud case. Kapoor was first arrested in March 2020 in a money laundering case by the Enforcement Directorate. The ED and Central Bureau of Investigation (CBI) have registered eight cases against him related to alleged frauds at Yes Bank. He was lodged at the Taloja jail in Navi Mumbai.
