This Case is about GROWTH STRATEGY, SUSTAINABILITY
PUBLICATION DATE: October 01, 2010 PRODUCT #: 311063-HCB-ENG
YES BANK, founded in 2003 and tremendously successful, has consistently been lucrative matching the Indian government’s Priority Sector Financing (PSL) conditions, unlike almost all other private sector banks, which see PSL action as a crucial but loss-making part of their portfolio. Now, however, the Development Banking team is considering going to the Board to take the concept one step farther: pro-actively investing in PSL-qualifying actions not company but although as a question of regulatory compliance.YES BANK Mainstreaming Development into Indian Banking Case Solution
Should the bank allocate considerable human and financial resources into an ambitious Financial Inclusion Program to serve rural people that are previously unbanked through using nonbank company correspondents and a fast growth of its branch network? Additionally, should the bank invest part of its tight capital to Tatva Capital, a private equity enterprise focused on renewable energy, clean technology, waste management, water & sanitation, food & agribusiness, affordable health care, housing, schooling & support development? Is the Board prepared to integrate development banking into the mainstream of the bank, or will this turn out to be a significant mistake in judgment?