While convening a press conference few hours later SBI made its announcement, the former Finance Minister said he believes that SBI has been ordered to rescue Yes Bank.
P Chidambaram said, "I don't get a feeling that SBI is a volunteer in the rescue act (for Yes Bank). Just as LIC was not a volunteer in the IDBI Bank's rescue act. These are command performances."
The minsiter called the Yes Bank crisis a 'debacle' and said it is "only part of the BJP government's mismanagement of country's financial institutions."
"The best judge for any financial crisis is the market. Yesterday, the Sensex fell by 884 points. The price of SBI's share fell by Rs 18 and that of Yes Bank fell from Rs 36.8 to about Rs 16," Chidambaram said.
The Reserve Bank of India, on Thursday has imposed a one month moratorium on capital-starved Yes Bank and fixed the monthly withdrawal limit for depositors to Rs 50,000 per account. The RBI and the Finance Ministry have assured Yes Bank depositors that their money is safe, saying the RBI will "protect their interests."
On Saturday, India's largest lender, the State Bank of India (SBI), said its board has given an in-principal approval for the bank to buy up to 49 per cent stakes in Yes Bank. Addressing a press conference in Mumbai, SBI Chairperson Rajnish Kumar said the bank would be investing a minimum of Rs 2,400 crore in Yes Bank.