YES Bank, India's 5th largest private sector Bank, has received an approval from the Reserve Bank of India to sponsor a mutual fund and to setup a Asset Management Company (AMC), and a trustee company. The AMC and the trust companies shall be set up as wholly owned subsidiaries of YES Bank.
The AMC will channelize the savings of retail and institutional investors in equity and debt capital markets complementing the bank's retail liabilities strategy.
The bank said, "This also allows the AMC to leverage the bank's distribution network for customer acquisition, and provide customers a seamless digical experience for their investments & savings solutions. The bank will simplify and integrate 'manufacturing to distribution' of equity and debt investment products for all its customers."
"The AMC will also gain from the bank's expertise in investment advisory, wealth management solutions, debt capital markets, its significant and growing customer base & distribution network, and overall execution expertise, to build a large and profitable fund management franchise," it added.
As the bank accelerates into its next phase of growth, this new business initiative will provide further acceleration to YES Bank's differentiated product offerings to its customers.
YES Bank will now apply to SEBI to seek necessary approvals.
Shares of the bank gained Rs 8.6, or 1.19%, to trade at Rs 733.80. The total volume of shares traded was 92,447 at the BSE (10.47 a.m., Monday).