The retail equities broking license received by Yes Bank Ltd from India's central bank will intensify competition among banks for retail deposits.
Yes Bank will establish a new subsidiary to conduct this business. It expects to start its securities broking business during the 2013-14 fiscal year that begins next April. It said its broking business would offer synergies to its retail savings and loan offerings.
"The timing is opportune given our thrust and focus on retail banking," said CEO Rana Kapoor.
Indian banks compete aggressively for retail deposits to help fund a liquidity shortage at a time when lenders are struggling to contain a rising mountain of non-performing loan portfolios.
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