The Central government through the Ministry of Finance has made an order imposing moratorium on YES Bank with effect from 6PM today, i.e. March 5, 2020.
The order comes in light of a recommendation made by the RBI keeping in mind the mounting bad debts on the bank. The moratorium will subsist until April 3, 2020 and until then, the depositors will not be allowed to withdraw more than Rs. 50,000, irrespective of the number of accounts held with the bank.
Notably, the RBI may by a general or special order, permit the banking company to allow payment to its depositors an amount in excess of Rs. 50,000 to meet unforeseen expenses such as medical treatment, higher education, obligatory expenses in connection with marriage and other unavoidable emergencies.
Prashant Kumar, former CFO of the SBI has been appointed as the administrator and the Bank's board has also been superseded with immediate effect.