Private sector lender, YES Bank plans to seek approval from the regulators for entering into the asset management and the primary dealership business. In the board meeting held on Wednesday, the board of directors of the bank has approved the proposal to seek regulatory nod.
“With a view to complete the overall bouquet of financial products to its customer franchise, the Bank plans to set up an Asset Management Company (AMC), primarily to channelise the savings of retail investors in equity and debt capital markets. This will complement the Bank’s retail liabilities strategy, strengthen multi-product customer engagement and also allow the Bank to leverage its distribution network for customer acquisition,” the lender said in a filing to the exchanges.
However, the bank is yet to decide on whether they want to build their asset management business or to buy an AMC.
“Unlike the retail securities broking arm business that we were sure on about building it internally we are still finalising on whether we want to buy an AMC or build our own. As a result we are working on both the possibilities now,” said Rajat Monga-Group President & Chief Financial officer, YES Bank.
The lender has been ramping up its retail business and the mutual fund business will further help YES Bank in improving its focus on scaling up this end of the segment.
“The AMC will also complement the Bank’s retail strategy and help in leveraging existing infrastructure to provide the necessary retail thrust. This will allow the bank to build a holistic wealth management proposition for its customers and enable the Bank to strengthen traction witnessed in building retail market share on the back of its Savings Account proposition,” said the release.
Currently, YES Bank’s offers the highest rate of interest on its Savings Bank account. The savings account rate for balance of Rs one lakh and above is 7 per cent per annum and for balance below Rs one lakh depositors can earn 6 per cent per annum.
At the end of December 31, YES Bank had 600 branches.