March 6, 2020

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Nippon India Mutual Fund marks down Yes Bank perpetual bonds to zero

Nippon India Mutual Fund has marked down the value of perpetual bonds of troubled Yes BankNSE -56.11 % to zero in their schemes. The fund house has also imposed a limit of Rs 2 lakh on fresh inflows into the impacted schemes till further notice. The Yes Bank shares and bonds took a huge hit after the Reserve Bank of India (RBI) imposed a month-long moratorium on the bank on Thursday.

The perpetual bonds of Yes Bank Limited held by schemes of Nippon India Mutual Fund are rated investment grade. The valuation agencies though have further marked down the securities from Rs 73.7922 to Rs 47.4997 in light of the developments during the day.

The fund house also said that, “Fresh inflows in the scheme have been limited to INR 2 lakh per day per scheme per investor, till further notice. This limit is imposed only on the new applications, switch-ins, Systematic transfer plans, systematic investment plans received after the cut off time on March 5, 2020.”