Case study yes bank too big to fail group 2

lOMoARcPSD|21911340 UEH UNIVERSITY COLLEGE OF BUSINESS SCHOOL OF BANKING Case Study: YES BANK TOO BIG TO FAIL GROUP Instructors: Dr Pham Khanh Duy Group members Lê Phương Thanh (Leader) 31211021453 Hà Kim Phụng 31211026868 Vũ Mạnh Cường 31211021227 Hoàng Thị Anh Thư 31211021482 Lê Huỳnh Mỹ Duyên 31211021232 Nguyễn Thị Thanh Thảo 31211024978 Ho Chi Minh City, May 1, 2023 lOMoARcPSD|21911340 TABLE OF CONTENTS I Introduction II VERSION 1.0: THE BEGINNING .3 Growth Strategy Knowledge Banking Technology as a Competitive Advantage 4 Risk Management Process 5 Performance and Accolades III VERSION 2.0: EXPANDING FRICTION Promoters Battle for Board Seats Regulation of Banking Sector .7 High Court Verdict IV VERSION 3.0 AND GROWING CONCERNS Asset Quality Review Failed Qualified Institutional Placement V VERSION 4.0 AND TURMOIL 10 One Year of Ravneet Gill 11 VI VERSION 5.0: GOING CONCERN .12 Yes Bank Limited Reconstruction Scheme 2020 .12 The issue with the Reconstruction Plan 13 VII Others cases 14 VIII Corporation 90, 91 14 IX References 15 lOMoARcPSD|21911340 I Introduction “Too big to fail” is a phrase that all of us have heard at least once So what does this phrase imply? Why is it so famous? Let's find out together "Too big to fail" literally means, so big that it can't fail, but it doesn't mean that the strong with absolute strength cannot be defeated by the weak Here, this phrase refers to a business of great importance to the economy, the collapse of which will have a great effect on the economy, even causing the economy to collapse The word "big" here does not mean that the size of the enterprise is large, but it implies that the enterprise participates in many economic sectors of the economy Therefore, the collapse of that business can lead to the collapse of the whole economy To prevent this from happening, the government will compare the cost of a bailout against the cost of letting the economy fail before making a decision to allocate funds to help Are the banks “Too big to fail”? To answer this question, let's learn about Yes Bank - India's largest private bank to understand more about too big to fail in banking as well as the consequences for the banking system and economy when too big to fail happen in the bank We will also learn more about the Indian government's plans and solutions to rescue yes bank from bankruptcy II VERSION 1.0: THE BEGINNING In November 2003, Rana Kapoor and Ashok Kapur founded Yes Bank They had previously worked together with Harkirat Singh to establish and manage Rabo India Finance, a non-banking financial enterprise in conjunction with the Dutch-based Rabobank Rana Kapoor, a Rutgers University MBA graduate, began his banking career in 1980 with Bank of America, then led ANZ Grindlays' India business from 1996 to 1998 before founding Rabo India Finance in 1998 Ashok Kapur, Rana Kapoor's brother-in-law, was also a professional banker who had worked in various positions at Grindlays Bank since 1962 and was the first Asian to be appointed the "Country Manager" of ABN Amro Bank, India Rana Kapoor and Ashok Kapur were able to meet the minimum paid up capital of INR 2,000 million by selling their stakes in Rabo India Finance and receiving investments from private equity investors such as Citicorp International Finance Corporation, ChrysCapital II LLC, and AIF Capital In May 2004, the Reserve Bank of India (RBI), India's banking regulator, granted Yes Bank (and Kotak Mahindra Bank) a license to begin banking operations in India Historically, India's banking system has been heavily regulated, with strict limits on key factors such as entry, interest rates, and asset allocation Following lOMoARcPSD|21911340 economic liberalization in 1991, the sector was gradually deregulated, and new private sector banks were permitted to enter Banks were required to maintain the RBI's capital adequacy, cash reserve ratio, and statutory liquidity criteria There are also rules for income recognition, asset categorization, provisioning and write-offs, and investment value Banks were allowed to set their own lending rates, although there were limits on loan exposure to individual borrowers and enterprises in the same group Growth Strategy The banking system in India consisted of 20 nationalized banks, 196 regional rural banks, 30 private sector banks, 32 foreign banks, a handful of cooperative banks, and non-banking finance firms at the time of Yes Bank's arrival Almost 70% of the country's 67,118 bank branches were in rural or semi-urban areas, especially since the regulations allowed banks to lend 40% of their credit to designated 'priority' sectors Yes Bank began operations in corporate and institutional banking and business banking in August 2004, financial markets and treasury in September 2004, and transaction banking in October 2004 In 2005, despite having only two places and limited activities According to Kapoor, in order to be a public trust institution, a bank must have internal and external confidence, the highest levels of governance, transparency, and accountability, and be responsible to the public - all of which may be achieved through an initial public offering (IPO) The IPO, which was oversubscribed by more than 30 times, drew a high degree of involvement from institutional investors Yes Bank's strategy included providing sector-specific expertise to consumers, harnessing technology, and empowering its employees as professional business owners, all while practicing responsible banking that helped the community Knowledge Banking To enhance knowledge expertise, Yes Bank chose a variety of new sectors such as food and agriculture, health sciences, engineering, technology, media, entertainment, telecommunications, auto, infrastructure, and retailing It identified the sectors based on (i) the growth potential of the sector; (ii) potential for innovative banking products; (iii) recognition and appreciation of knowledge as a differentiator; (iv) competitor activity; and (v) sector’s competitive position internationally A Development and Knowledge Banking group was established and staffed with professionals from the selected industries Product and relationship managers from various business sectors collaborated with the Knowledge Banking group to develop products that were suitable for different customers For instance, Yes Bank developed novel products and services to meet the RBI's priority sector lending targets, which other private banks frequently found difficult to achieve lOMoARcPSD|21911340 Technology as a Competitive Advantage The bank set up its information technology systems together with Gartner to enable it achieve high standards of customer service at lower cost structures In order to provide specialized solutions, it entered into long-term agreements with technology vendors The bank outsourced the majority of its technological requirements to Wipro Infotech, a major IT services company with headquarters in India, in order to concentrate on the core business of banking without sacrificing the opportunity to scale in the future The bank had typically been ahead of the curve in seeing emerging technological trends, which later also helped it to benefit from the rise in online payment transactions in the 2010s Risk Management Process The board of Yes Bank established a multi-tier credit approval process since according to RBI norms, a bank's board of directors has the ultimate duty for risk management First, all loans had to be approved by two other authorized approvers, one of whom had to be from the credit risk management department, in addition to the team leader of the relevant business segment This procedure was put in place to make sure that credit decisions weren't made just on the basis of one functionary Second, if the total exposure to the client exceeded threshold limitations set by the risk monitoring committee of the Board, the proposal had to be submitted to the credit committee, a committee made up of senior executives, for approval Finally, the minutes of all credit committee meetings were to be reviewed by the risk monitoring committee Performance and Accolades Yes Bank reported excellent growth and profitability since the IPO and won many awards for banking philosophy The bank managed to maintain a good balance between interest income and non-interest income, with the latter coming mostly from financial advising, transaction banking, trade financing, financial markets, and other fee income However, loan exposure was severely unbalanced, with retail banking assets at INR 21,097 million while assets resulting from corporate banking at INR 202,436 million for the year ending in 2010 Kapoor was recognized as the engine behind the bank's success and was given numerous honors, including the PHD Chamber's Entrepreneur of the Year Award in 2007 He was also known in the industry as someone who saw the big picture and did not strictly go by numbers and ratings lOMoARcPSD|21911340 III VERSION 2.0: EXPANDING FRICTION April 2010, Yes Bank proposes a 5-year plan, this is considered version 2.0 Build the World's Best Quality Bank in India With targets like 750 branches, 3000 ATMs and 12,000 employees and achieving a deposit base of INR 1,250,000 million and a loan book of INR 1,000,000 million To achieve the above goal, Yes Bank focuses on increasing current and savings account deposits, optimizing risk management to maintain high asset quality, and diversifying revenue generation across banks different segments and products The bank has invested in setting up High quality, modern branch infrastructure in premium street locations, use strategy business-to-business-to-customer(B2B2C) to exploit existing customers and provide specialized products for each customer segment It targets the supply chain of large corporate clients by providing superior cash management and liquidity management solutions In October 2011, Yes Bank received a big boostWhenRBI announced the deregulation of savings account interest rates and allowed private banks to set interest rates Yes Bank was the first to respond to this by offering an interest rate of 6-7% to savings account customers, significantly higher than the 4% offered by Public Banks and other banks other large privates Promoters Battle for Board Seats Yes Bank was on the growth track and achieved some of the goals set out in Version 2.0 when it metDifficulties and challenges for managers WhenAshok Kapur died tragically in the attackTerrorist attack at Trident hotel in Mumbai (Mumbai is the commercial capital of India) in November 2008 This is the shocking terrorist tragedy in India withmore than ten terrorist attacks with bombs and shootings at the same time were carried out all over Mumbai from 26 to 29 November 2008 causing more than 170 deaths and 300 injuries (including many foreigners like UK, France, Japan).According to the agreement between Ashok Kapur and Rana Kapoor as well as the terms of association of Yes Bank, the two promoters have the right to jointly introduce the names of the president, CEO/MD and three directors to the board of directors of Yes Bank This momentAshok Kapur already held about 16% shares of Yes Bank (Rana Kapoor and the consortium also held about 16% of the shares during this period) and left it to his wife Madhu Kapur and their children - Shagun Kapur and Gaurav Kapur However,2009 Nominations and Remuneration Committee (NRC) of the board of directors Yes Bank discussed and rejected the proposal to introduce Madhu Kapur to the board because she did not meet the instructions ‘fit and proper’ issued by the RBI.2011, Madhu Kapur meets Rana Kapoor to discussShagun Kapur's daughter can participate in the management of Yes Bank or not Shagun Kapur is a Tufts University dual major and MBA at the Indian Business School, having previously worked in private equity firms and then founded his own investment firm lOMoARcPSD|21911340 in 2007 Rana Kapoor allegedly asked them to consider selling their shares at this time.In 2013,Shagun Kapur's name was rejected by the board because “she did not meet the standards of Yes Bank and its peer-to-peer banks” The dispute between the two promoter groups escalated as Madhu Kapur approached Bombay High Court to challenge the re-appointment of Rana Kapoor as CEO and MD and the recent appointment of five directors for failing to consult under the terms general nomination Rana Kapoor says: “The appointment of a director is the responsibility of the board of directors No shareholder, especially those who are not on the board of directors, can direct the bank or its board of directors to which they should appoint The appointment must be in accordance with fit and proper guidelines One cannot just introduce one's loved one to the board of a bank Bank governance is purely driven by RBI regulations and not by shareholders Yes Bank always adheres to the guidelines of the RBI while appointing directors on the board.” Regulation of Banking Sector In 2005, RBI issued 'Guidelines on Ownership and Governance in Private Sector Banks', aimed at diversification of ownership in a bank by discouraging any related entity or group of entities holding more than 10% of the liquidation capital of private sector banks without prior approval of the RBI Any individual or group who wants to buy or hold more than 5% shares within the bank must meet the 'match and suitability criteria' set forth by the RBI and the bank is required to have prior acknowledgment from RBI prior to acknowledging the assignment Eligibility and suitability criteria include an assessment of factors such as integrity, reputation, an applicant's track record in financial affairs, legal compliance, and funding The RBI has broad supervisory capacity and responsibility to protect the banking system It is important that the appointment of the President, CEO and full-time director requires the approval of the RBI, even if the shareholders have voted in favor of the appointment The regulations also prevent directors, other than full-time directors, from being on the board continuously for more than eight years RBI reserves the right to replace a bank's board of directors for up to 12 months if necessary to prevent bank affairs from being conducted in a manner detrimental to depositors or to ensure bank management right way The appointment of an auditor of a bank must also be approved by the RBI High Court Verdict The relevant questions before the court concern whether Rana Kapoor can nominate these individuals without consulting Madhu Kapur and whether such nomination can be valid by ratification by the judges shareholders or not The re- lOMoARcPSD|21911340 appointment of Rana Kapoor as CEO in 2012 was also challenged for not consulting the other promotion team Rana Kapoor was approved by the board of directors and shareholders, his appointment was duly held However, the court rejected the appointment of the five directors for failing to consult the Madhu Kapur corporation and the independent directors for failing to follow the prescribed legal procedure, respectively The court recognized Madhu Kapur's right as promoter to jointly nominate three directors but refused to grant a reserved seat on the board to Shagun Kapur or some other candidate (Interestingly, during the court hearing, it was revealed that Rana Kapoor contacted RBI to declassify Madhu Kapur (and her family) as a promoter since 2010 RBI directed Yes Bank reduced the ownership of the promotion and promotion group to less than 10% in March 2014 As of March 31, 2014, Rana Kapoor group holds 13.64% shares and Madhu Kapur group holds 11.91% shares.) IV VERSION 3.0 AND GROWING CONCERNS Yes Bank has launched next year plans to develop into a High Quality bank The bank with only a 1% market share has sought to grow to 2.5% by 2020 by adopting a two-pronged strategy of Increasing Mind Sharing and Growing Market Share The bank also launched a brand campaign “India bole Yes” to attract the attention of retail banking customers It completed its retail portfolio with the 20162017 credit card launch As the first bank to launch a mobile payment application based on the Unified Payments Interface (UPI) in partnership with PhonePe— > accounts for a significant portion of the growing digital payments market in India However, the focus is on increasing market share by significantly expanding retail franchises Asset Quality Review When YesBank launched version 3.0 and sought to become a major bank, concerns began to arise about the quality of assets accumulated by Yes Bank In the mid-2010s, concerns arose about a double balance sheet problem in the economy stressed banks and heavily indebted businesses From 2003-2008, India had an annual GDP growth rate of more than 7.5% per year Despite a year-over-year slowdown in growth due to the global financial crisis, India's growth rebounded quickly to ~8%— >double digit growth forecast Companies have launched new projects worth trillions of rupees, especially in infrastructure sectors such as power generation, steel and telecommunications The investment was financed by an equally significant credit boom, with total bank lending to industry increasing from INR 3.35 trillion in 20032004 to INR 26.16 trillion in the year 2013-2014 However, the annual growth rate Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 slowed down to 5-6% for consecutive years In 2015 More than 40% of a company's debt had an interest coverage ratio of less than From its inception until 2015, Yes Bank has never reported total bad assets or net bad assets (NPA) above 1% In July 2015, UBS Securities India released a report noting that banks in India have continued to lend to 100 troubled companies despite high leverage and low cash flow.Yes Bank loan approvals for these troubled companies have tripled in that time Estimated loans approved for these troubled companies as a percentage of net worth were highest for Yes Bank (125%) of the banks studied Based on these numbers, UBS believes Yes Bank is most vulnerable to a major corporate default and downgrades its stock From 2006-2015, the number of refinanced loans increased more than 50 times —>concerns that banks are making loans on a regular basis to postpone problems, allowed due to the RBI regulatory prohibition For example, an analysis report in 2015 showed that the total debt of 10 business groups was INR 7.34 trillion and the interest coverage ratio of these 10 groups as a whole was only 0.8 RBI has published the asset quality assessment (AQR) of banks to determine the accuracy of banks' NPA reporting AQR said that some public and private sector banks did not disclose the true extent of their NPA by a large margin Yes Bank also shows a big difference between the reported and assessed NPA by the RBI: The bank reported a gross NPA and a net NPA of INR 7,490 million and INR 2,845 million as of March 31, 2016, respectively, while RBI assessed at INR 49,256 million and INR 36,031 respectively The next AQR conducted by RBI again showed a big divergence of total NPA of INR 63,551 million and net NPA of 48,193 at Yes Bank on 31/3/2017, although Yes Bank managed to recover or raise provided a large proportion of divergence in fiscal year 2018 The auditors or directors did not make specific observations on the reasons for the divergence, other than reporting the divergence in the format prescribed by the RBI Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 Failed Qualified Institutional Placement In September 2016, Yes Bank sought to raise up to $1 billion by selling new shares to institutional investors through a qualified institutional placement.(QIP) The company then raised capital using an additional perpetual tier bond (AT-1 bond) that was unsecured and not convertible into equity shares New equity shares in 2016 were offered for sale between INR 1,350 and INR 1410 per share, slightly below the price at which the shares were trading in the market at the time Issues were registered 1.1 times in the first day, but the offer continued to open even after it was fully registered The extension of time leads to the share price falling to 1321 INR on the secondary market, it is important to be below the lowest price of the offering Several institutional investors who had previously auctioned shares withdrew their bids and Yes Bank was forced to withdraw the QIP issuance Ex: Kapoor But then, in 3/2017, Yes Bank successfully raised about $750 million by selling equity shares for INR 1,500 to institutional investors The bank had another round of QIP of $275 million in August 2019 Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 V VERSION 4.0 AND TURMOIL In April 2018, the board of directors of Yes Bank, based on the recommendation of the nomination and remuneration committee, recommended the reappointment of Kapoor as CEO and MD for another 3-year term until September 2021 In September 2018, RBI rejected the 3-year reappointment of Kapoor, allowed him to continue only until January 31, 2019, and directed the board to find a successor by then RBI feels the role of MD & CEO assigned in the work of running, managing and supervising the affairs of the bank The share price of Yes Bank’s shares fell by 34% when news of RBI’s decision regarding the reappointment came out It was later revealed that RBI had sent multiple letters to Yes Bank prior to September 2018 that flagged governance failures and violation of regulations by Yes Bank In the letter which rejected Kapoor’s reappointment, RBI highlighted the lack of adequate response received from Yes Bank It is a matter of concern that the bank’s letter (to RBI) dated May 31, 2018 seeking approval for reappointment of Shri Kapoor did not even mention, let alone respond to, our letter of April 11 The extracts of the minutes of the meetings of the Nomination and Remuneration Committee (N&RC) held on April 25, 2018 and the board held on April 26, 2018, to consider reappointment of the MD & CEO are, similarly conspicuously silent on this aspect The board of Yes Bank appointed a ‘search and selection’ committee to find a successor and requested RBI to allow Kapoor to continue until September 2019 but this request was rejected by the regulator While the committee was in the process of finding a successor to Kapoor, three directors of the board, including the chairman Ashok Chawla, resigned citing different reasons Then, Ravneet Gill who was previously the CEO of Deutsche Bank India is announced as the next CEO of Yes Bank One Year of Ravneet Gill Gill identified risk management, compliance, and governance as the critical areas to focus on to improve perception with the regulators and investors Ravneet Gill later disclosed that there had been large underreported stressed assets in Yes Bank Gill took a provision of about INR 36,617 million for the quarter, resulting in a loss of INR 15,066 million for the quarter ended March 31, 2019, the first quarterly loss reported in the company's history The bank also created a watch list of loans worth INR 100,000 million pertaining to companies operating in infrastructure, entertainment, and real estate that may potentially turn bad in the future In May 2019, RBI appointed R Gandhi, the former deputy governor of RBI, as an additional director on the board RBI also banned the audit firm SR Batliboi & Co, who had been the auditor of Yes Bank from inception until 2016, for a period of year Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 for lapses in statutory audit Yes Bank’s share price fell precipitously, 30% off on April 30, 2019 Another major priority for Gill was to raise capital since the tier capital adequacy of the bank was progressively diminishing and was further expected to fall due to stressed assets In subsequent meetings with individual investors, largely also run by Gill himself, more unpleasant truths were revealed Such as the bank's portfolio of BBB and lower rated loans Or its exposure to the strained Anil Ambani group has been as high as 50% of its common equity tier capital In September 2019, the bank revealed to the exchanges that it had received strong interest from multiple foreign and domestic investors and was on course to raise growth capital In subsequent updates, it was revealed that the bank had received binding offers from investors to raise up to $2 billion, including a $1.2 billion from a foreign investor Though there was a marginal rally in share price, concerns emanated about the reliability of the investors The concerns about the investment round came to full public attention when an independent director Uttam Prakash Agarwal (also chairman of the audit committee) resigned from the board and revealed that the management had misled the public and the board regarding the capital raising exercise As the bank attempted to raise capital, Kapoor had sold his entire stake in the bank Apparently, he had sold his entire stake on direction from the lenders to whom Kapoor had pledged the shares to raise loans By March 2020, the situation turned south for both Yes Bank and its founder The Enforcement Directorate, the law enforcement agency responsible for economic crimes in India, arrested Kapoor on charges of money laundering The agency has alleged that Kapoor, 62, entered into a criminal conspiracy with Kapil Wadhawan, DHFL director-promoter for round-tripping of funds where loans from Yes Bank to DHFL landed in companies owned by Rana Kapoor's daughters, DoIT Urban Ventures (India) Pvt Ltd The agency has alleged that between April and June, 2018, Yes Bank invested Rs 3,700 crore in short-term debentures of Dewan Housing Finance Corporation Ltd (DHFL) DHFL had in turn granted a loan of INR 6,000 million to a company controlled by Kapoor’s16 family even though the security provided for the loan was grossly inadequate The bank’s performance and asset quality continued to deteriorate, causing concerns about its survival, and prompting the Government of India, on advice from RBI, to intervene Gill was asked to leave by the RBI appointed administrator and the entire board of Yes Bank was superseded Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 VI VERSION 5.0: GOING CONCERN Yes Bank Limited Reconstruction Scheme 2020 On March 13, 2020, the Government of India announced The equity changed from 11,000 crore rupees to 6,200 crore rupees after the reconstruction State Bank of India bought 49% of the shares after the reconstruction and is not allowed to reduce the interest below 26% during the three years of the reconstruction Yes Bank is expecting to receive investments from other major banks like ICIC Bank, HDFC Ltd, Axis Bank, Kotak Mahindra Bank etc The total value of new investments in Yes Bank is approximately 27,150 crore rupees Yes Bank has more than 8,000 values of additional Advanced Level (AT1) bonds that should be evaluated as part of the reconstruction program According to BASEL standards, additional bonds are loss-covering capital instruments that should be assessed if the bank exceeds the equity threshold Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 The number of shares was reduced to 24,000 crores with a face value of rupees This graph shows the change in the share price of Yes Bank in July, October, January and April from 2015 to 2020 The Investment Bank or State Bank of India may, at its discretion, nominate two candidates for Directors In addition to this, the RBI can also appoint directors to the Reconstruction Board However, the board can terminate key management positions Account holders are not entitled to any compensation from the reformed bank However, despite the changes, some things remain unchanged, such as working conditions and the seniority of employees No changes will be made in the branches of the reformed bank After restructuring, there will be no changes in the bank's assets and liabilities While the reconstruction plan is a laudable measure to prevent Yes Bank from collapsing, the plan has not failed and has many serious flaws Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 The issue with the Reconstruction Plan Due to the decline in the value of the shares of Yes Bank, the interest of the shareholders of Yes Bank may seriously suffer This loss may be unavoidable even after RBI's investment in the bank Due to the addition of shares purchased by several state-owned banks, there is a potential conflict of interest between the two banks It cannot be overlooked that the Reserve Bank of India took measures too late to prevent the failure of Yes Bank The activities of the Reserve Bank are not specific enough This may be due to the end of supervision by the Reserve Bank of India Besides that, Another major concern that arose out of the reconstruction scheme pertained to the treatment of the additional tier (AT-1) bonds worth INR 84,150 million As per the terms of the contract with the investors, these bonds are permitted to be written down in the event the common Tier capital ratio of the bank falls below a specified percentage, making it a relatively risky instrument As part of the reconstruction plan, the bank wrote down the entire value of the AT-1 bonds When the news about the write down was first reported, it also emerged that Yes Bank’s executives had allegedly mis-sold these AT-1 bonds to retail investors as ‘super FDs’ that yield higher returns than standard fixed deposits but without explaining the risks involved VII Others cases In 2008, was the financial crisis of 2008 that started with low credit policy and lending standards that ignited a housing bubble A series of banks around the world collapsed,The British government nationalized Northern Rock Global investment bank Bear Stearns, a Wall Street mainstay dating back to 1923, collapsed and was acquired by JPMorgan Chase IndyMac Bank, and the country's two largest home loan companies, Fannie Mae and Freddie Mac, were seized by the US government The culmination of Lehman Brothers in September marked the largest bankruptcy in US history and has for many become a symbol of the devastation wrought by the global financial crisis The US government approved a $700 billion bailout during the global financial crisis, some estimates suggest that the US spent, loaned or guaranteed as much as $12.8 trillion to rescue the economy And prevent these institutions from going down and causing further damage to the economy Although a few of these institutions were allowed to fail, such as Lehman and Bear, the government prevented the collapse of other major banks, all of which continue to thrive to this day Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 VIII Corporation 90, 91 Corporation 90 is a common name for the unions of enterprises and state-owned corporations in Vietnam established on the basis of Article of Decision No 90/Ttg of the Prime Minister of Vietnam on the arrangement of enterprises reorganize stateowned enterprises Corporation 90 must have at least member units related to each other in terms of technology, finance, investment and development programs, services in terms of supply, transportation, consumption, information and training; must have a legal capital of more than 500 billion VND (for some corporations in specific industries, the legal capital may be lower but must not be less than 100 billion VND) Some 90 prominent corporations: Vietnam Electrical Equipment Corporation, Saigon Beer - Alcohol - Beverage Corporation, Vietnam Industrial Construction Corporation, Vietnam Petroleum Corporation, etc Corporation 91 is a common name for groups of state-owned enterprises in Vietnam established under Decision No 91/Ttg of the Prime Minister of Vietnam on piloting the establishment of business groups Although the spirit of Decision No 91/Ttg was towards the establishment of business groups, at the time of 1994, business grouping was a very new form of business organization in Vietnam Therefore, the groups of enterprises established under the above decision are not immediately called corporations but are collectively known as 91 corporations It was not until 2006 that 91 corporations were gradually transformed into 91 corporations real corporations The establishment of any 91 corporation is under the decision-making authority of the Government The Management Board of Corporation 91 consists of to members appointed by the Prime Minister Corporation 91 must have at least members, must have a legal capital of at least 1000 billion Unlike a 90 corporation, a 91 corporation can operate in multiple industries while still being required to pursue a mainstream business The purpose of establishing corporations 91 is to promote the role of the State in the socialist-oriented market economy However, due to limited management capacity and capital, 91 corporations have not been able to promote their functions and have not benefited member companies Some prominent 91 corporations: Bao Viet Group, Vietnam Electricity, Vietnam National Oil and Gas Group, Downloaded by vu quang (vuchinhhp20@gmail.com) lOMoARcPSD|21911340 IX References Reconstruction of yes Bank Legal Service India - Law, Lawyers and Legal Resources (n.d.) https://legalserviceindia.com/legal/article-8979-reconstruction-of-yesbank.html Indian Institutes of Management (1992) Library of Congress Office Downloaded by vu quang (vuchinhhp20@gmail.com)