List of Mutual Fund Schemes affected by Yes Bank Crisis – What investors do now?

List of Mutual Fund Schemes effected with Yes Bank Crisis – What investors do nowList of Mutual Fund Schemes affected by Yes Bank Crisis – What investors do now?


There is one major news now in the investor community. Yes Bank Crisis. RBI has put a moratorium on Yes Bank, where account holders can withdraw only upto Rs 50,000. It also indicated that all debt papers / bonds has no value now. RBI has put several restrictions on Yes Bank, where several mutual fund schemes also would get affected. In this article, we would provide the list of mutual fund schemes that affected by Yes Bank Scam and what an investor do in this crisis.

Also Read: Best Balanced Advantage Funds to invest in 2020

How did Yes Bank Crisis triggered?


Yes Bank has been facing crisis in the last few years due to bad loans.

Like any other bank, Yes Bank has given loans to its customers. However, there was a crisis of non-performing assets. Some of them became bad loans and many loans, there are repayment delays. The bank has been looking for investors and hunting for cash to come out this crisis. However, there were no investors. On top of this, Yes Bank faced governance issues. As per an analysis, it under reported Non Performing Assets (NPAs) to the tune of Rs 3,300 Crores in FY2018-19.

Finally RBI has concluded that there was no proper plan from Yes Bank to come out such crisis and finally imposed moratorium on Yes Bank.

What is RBI Moratorium on Yes Bank?


RBI has put some restrictions on Yes Bank through moratorium.

1) Account holders would be able to withdraw up to Rs 50,000 from their account.

2) The cap on withdrawal is exempted and you can withdraw up to maximum limit of Rs 5 lakh in the following scenarios. RBI approval is required for this.

To pay for medical treatment

To cover higher education costs, in India or abroad

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To pay for “obligatory expenses” for a wedding or other ceremonies

In “any other unavoidable emergency”

3) RBI has suspended current Yes Bank Board.

4) RBI indicated that salaries of the 20,000 Yes Bank employees would be paid in normal.

List of Mutual Fund schemes that have invested in Yes Bank Bonds


MFs keep investing in corporate / bank bonds and debt papers. Since credit rating agencies would downgrade ratings of Yes bank, the underlying paper value would be reduced. Mutual Fund schemes would mark down the value of such investments and this would show a decline in the value of the NAV. Here is the list of mutual fund schemes that invested in Yes Bank debt papers and bonds as of end of Jan-2020. Some of them would have exited in the last few days.  

Fund Name Market Value (in Rs. cr)
Nippon India Equity Hybrid Fund637.8
Nippon India Credit Risk Fund540.1
Nippon India Strategic Debt Fund436.3
Franklin India ST Income Plan281.1
Franklin India Credit Risk Fund135.2
UTI ULIP128.3
Nippon India Hybrid Bond Fund102.7
UTI Credit Risk Fund71.3
UTI CCF - Savings Plan71.3
Kotak Credit Risk Fund63
Franklin India Dynamic Accrual Fund54.4
Nippon India Equity Savings Fund53.3
Nippon India Retirement Fund-Wealth Creation36
Kotak Medium Term Fund30.8
Baroda Treasury Adv Fund24.1
UTI Hybrid Equity Fund22.5
PGIM India Credit Risk Fund21.9
Baroda Credit Risk Fund-A18
UTI Medium Term Fund (Segregated - 17022020)7.4
UTI Medium Term Fund7.4
IDBI Credit Risk Fund7.2
Franklin India Debt Hybrid Fund5
L&T Resurgent India Bond Fund5
Sundaram Equity Hybrid Fund5
Baroda Hybrid Equity Fund4.3
Baroda Dynamic Equity Fund3.6
Baroda Equity Savings Fund3.6
Mahindra Credit Risk Yojana1.6

Which mutual fund house has the highest impact?


There are total of 32 mutual fund schemes that has invested in Yes Bank bonds to the tune of Rs 2,848 Crores.

Out of this, 28 schemes have exposure to the tune of Rs 2,779 Crores in perpetual bonds that has no maturity date.

Nippon AMC has invested Rs 1,806 Crores.

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Can mutual fund investors do something about this now?


There is little you can do now. The mutual funds that invested in Yes Bank bonds are already marked down. Even if you want to sell them now, the NAV is already reduced. Hence, you would get lower amount. RBI is proposing a revival plan for Yes Bank. SBI and LIC are planning to invest in Yes Bank now.  Once we get clarity on the resolution plan, investors should review and take a decision about selling their funds.

If your mutual fund account is linked to Yes Bank, you should link to other banks immediately so that mutual fund redemptions would get credited in non Yes Bank account.

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Suresh KP

List of Mutual Fund Schemes effected with Yes Bank Crisis – What investors do now

Suresh KP

9 comments

  • Santosh

    Hi Suresh,
    Hope you are doing good .
    The Sensex bloodbath continues… Wanted to check is it ok to stay invested in Uti Value oppurtunities fund and HDFC top 100 fund ? i have invested in the above for last few years but dont seem they are performing well as of last couple of years . Please advise.

    regards
    Santosh

  • Baskaran

    There is a strong suspicion that Nippon ( erstwhile Ambani Reliance) MF is a quid pro quo for the massive loan extended by Yes to Reliance ( Ambani) group.

  • ravi chandiran

    Dear Suresh Sir,

    Pl advise what the shareholders of YES bank has to react now. whether going for addl. purchase for averaging or keep quiet or sell out with loss since I have 1500 shares at an avg. price of Rs.180 = 2.50 lacs now comes to Rs.25000.
    Expect suggestions. Thqs.

  • Prashanth

    Thank you Suresh garu for timely insights of Yes bank.
    I hold the below MFs from Nippon. Are they all affected too with the YES bank crisis now

    1)NIPPON INDIA – US EQUITY OPPORTUNITES FUND – DIRECT GROWTH PLAN – GROWTH

    2) NIPPON INDIA BANKING FUND – DIRECT GROWTH PLAN GROWTH OPTION – GROWTH

    3)NIPPON INDIA PHARMA FUND – DIRECT GROWTH PLAN – GROWTH
    Investment Value

    4)NIPPON INDIA SMALL CAP FUND – DIRECT GROWTH PLAN GROWTH OPTION – GROWTH

    • Prashant, Pls check the list I shared. Only those 32 odd are affected by investments done by them in Yes Bank Debt papers / bonds. However, if any mutual fund has invested in Yes Bank shares, this article does not cover that

  • RAVEE S

    Hai Suresh, Thanks for the write up. Pl suggest or write – what the shareholders of YES Bank has to react now and how to tackle the issue since I am an example that I have invested on this Stock and holding 1485 shares at an avg price of 180 from the year 2017. Invested Rs.2.70 lacs now the value is only Rs.25000 (Price Rs.16).
    Thanks in advance

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