YES BANK and IFC to set up Private Equity Fund for development in North East India

Imphal, February 05, 2013: YES BANK, India’s fourth largest private sector Bank, and the International Finance Corporation (IFC), a member of the World Bank Group, on Moday signed a Memorandum of Understanding (MoU) to jointly create a fund that will make significant investments across sectors in the North Eastern states of India. The MoU will be the foundation for discussions between YES BANK and the IFC for setting up a Private Equity Fund focused on Small and Growth Enterprises (SGE) in the region. The MoU was signed by Mr. Jin-Yong Cai, EVP & CEO, IFC and Mr. Rana Kapoor, MD & CEO, YES BANK.

Both IFC and YES BANK share a common goal of fostering India’s economic and social development on an inclusive and sustainable basis. The fund is an outcome of that common vision for the North Eastern Region of India with significant economic potential and one that needs immediate private intervention to realize that potential. The fund corpus will focus on investments spread mainly across sectors of Tourism & Hospitality, Food & Agribusiness, Infrastructure, Healthcare, Education & Livelihood Creation and Affordable Housing.

“IFC's work to increase access to capital for small entrepreneurs in northeast India will help support inclusive growth in a low-income area—one of our top priorities,” saidJin-Yong Cai, IFC Executive Vice President and CEO. “This initiative will leverage the expertise and resources of IFC and YES BANK to develop long-term solutions that can be replicated in other low-income and fragile regions.”

Commenting on the development, Mr. Rana Kapoor, Managing Director & CEO, YES BANK, said, “We are extremely pleased to enter into this strategic agreement with IFC. We believe that there are substantial untapped opportunities existing in the North Eastern states of India that need to be honed by the private sector in order to create local livelihood opportunities resulting in greater financial inclusion in the region. At YES BANK it is our constant endeavor to support inclusive and sustainable development in the country and joint efforts with leading organizations like the IFC will help us leverage our respective capabilities to the fullest. I am certain that this partnership will go a long way in providing superior quality financial services to the North East.”

Last year, IFC provided a $75 million loan to help Yes Bank expand its network to reach underserved people, small and medium enterprises, and agricultural borrowers in India. Given the high growth potential of northeast India and opportunities for greater inclusion, IFC has been collaborating with institutions across sectors to foster economic and social development in the region.

YES BANK, which has developed strong knowledge practices in each of these areas, will also deploy its expertise and resources in this regard. IFC will support and complement these efforts through a combination of its investment and advisory services. IFC and YES BANK will in effect, jointly explore suitable intervention mechanisms including direct investments, financing to YES BANK for lending to borrowers in this Region besides the specialized Fund being structured to make smaller investments in the Region. IFC and YES BANK will also explore joint programs of technical assistance and advisory services to support private sector development in these identified sectors in the Region.

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