Yes Bank has signed a share purchase agreement (SPA) with JC Flowers Asset Restructuring Company (ARC) for a 9.9% stake in ARC at Rs 11.43 per share, the private sector lender informed exchanges after the market closed on November 28.

The bank said that the subsequent acquisition of an additional 10% stake is subject to necessary regulatory approvals.

On September 20, Yes Bank’s board approved the sale of a stressed loan worth Rs 48,000 crore to JC Flowers after receiving no bids from other challengers.

The bank intends to participate in ARC as a minority shareholder. “This will be an ancillary business to the bank’s main business,” it said. JC Flowers ARC has assets under management of Rs 595 crore and an annual turnover of Rs 19.9 crore as on March 31, 2022.

Yes Bank’s stand-alone net profit for the three months ended September 30, 2022, fell 32.2% year-on-year to Rs 152.8 crore. In the corresponding period of the previous fiscal year, the private bank posted a net profit of Rs 225.5 crore.

However, total revenue in Q2FY23 was Rs 6,394.11 crore, up from Rs 5,430.30 crore in the same period last year. The total non-performing assets (non-performing or non-performing loans) accounted for 12.89% of the real advances, compared with 14.97% in the same period last year.

After shifting non-performing loans to ARC, top bank chief Prashant Kumar reckons the GNPA ratio could drop below 2%.