Struggling to lighten its non-performing assets, Yes Bank has sold bonds in Dewan Housing Finance (DHFL) in the secondary market to raise Rs 500 crore. This will cut the bank's exposure to the troubled non-banking financial company (NBFC), which is in the midst of a debt resolution process under the insolvency proceedings of the National Company Law Tribunal (NCLT).

Crucial to Yes Bank's turnaround is the recovery of bad loans. The outbreak of Covid has impacted the recovery process. The bank has managed to make a recovery of Rs 900 crore and is expecting the current quarter to be better.

"In DHFL, our exposure was in bonds. Part of it has already been monetised through a market sale and we have to see about the remaining bonds. These are essentially subordinated debt," Yes Bank managing director told The Times of India.

Yes bank is also looking to sell its mutual funds by the end of the year to raise more capital.

Kumar said loans worth Rs 2,300 crore have slipped into default but are not categorised as NPAs due to the Supreme Court order. Another Rs 4,000 crore of loans, overdue by 60 days, are "at risk".

"These stressed loans would require provisioning of Rs 1,300 crore for the current year, against which the bank has made Rs 1,900 crore of provisioning for Covid stress," Kumar said.

Yes Bank is working on setting up an asset reconstruction company-like entity to take over its bad loans. "We are talking to stressed asset investors," Kumar said.

For growing its loan book, Yes Bank will continue to shift focus to retail. It will follow the "twin strategy of de-risking portfolio on the corporate side" and "growing the retail book". As a result, the growth has been 1.5%. We will see further growth but it will be in single digits," Kumar said.

Yes Bank will be "aggressive" in growing its deposit base through planned improvement in "the credit-deposit ratio from 123% to 100% by 2020-end".

A "flight of deposits before the takeover of the bank by an SBI-led consortium had resulted in the credit-deposit ratio crossing 163%".

Deposit increase is planned through expansion of the "catchment area of existing branches by acquiring customers digitally". It will also target current accounts of corporate customers by offering them cash management services. It will have partnership with Unified Payments Interface (UPI) platform PhonePe and use analytics to acquire customers.