The book sheds light on the journey of value creation and callous destruction by YES Bank’s promoter
While YES Bank seems to be fully on the path of recovery, the flamboyant Kapoor, currently lodged in jail, has become a source of curiosity, and many have been keen to understand how the once successful and flamboyant banker’s script turned awry.
Pavan C Lall’s Yes Man — The Untold Story of Rana Kapoor is an attempt to trace Kapoor’s rise and quell some of this curiosity, especially for readers who may not be well versed with the myriad twists that led to the bank’s troubles, and his own.
Hailing from a well to do family, Kapoor, a professional banker with stints in India and abroad, always spoke at length about the pains he took to build YES Bank. His attempts were often to showcase himself as the sole architect behind the bank and he loved to talk of his hopes for its future as a lender that would rival, if not outperform, larger private sector peers like HDFC Bank.
Kapoor would often choose to gloss over issues he found inconvenient — like the fact that YES Bank was co-founded with his brother-in-law Ashok Kapur, his very public legal spat with Kapur’s daughter and wife, many of the corporate loans given by the bank and even the divergence in bad loan reporting.
The book dwells on these issues while chronicling Kapoor’s life starting from his childhood in Delhi in a “better than upper middle-class family” to his banking experiences at BankAm, the setting up of Rabo India Finance and YES Bank, his business dealings, his exit from the bank and the allegations against him.
Written in the style of a racy thriller, it starts off as a good read, perhaps for the weekend or even for a flight or train journey, and has many interesting anecdotes and insights to keep the reader engaged.
Lall has done his legwork as a journalist and spoken to a number of people, who knew Kapoor and his business dealings. Many of them are on record, others remain unnamed sources but Lall uses their comments and insights to paint a fairly comprehensive picture of Kapoor and often gives the reader the feeling of being present at many critical incidents with his vivid description.
Particularly interesting are the details about Kapoor’s stint at Bank of America, his relations with his colleagues and bosses there as well as how he eventually overshadowed Kapur at YES Bank. “A former colleague who worked with Rana Kapoor remembers him as a smart, well-dressed young executive on the first day he came into work at BankAm… In due course, what people would notice about Kapoor was that he was adept at managing upward management relationships in the office,” Lall writes.
Equally interesting are the details about setting up of Rabo India Finance and YES Bank, which started off as Harkirat Singh’s dream but was eventually taken over by Kapur and Kapoor.
“Then Kapur recommended a professional called Kapoor who was already with their NBFC and who had spent a fair amount of time with BankAm as a senior corporate banker. Singh went along with the suggestion because he trusted the judgement of his former colleague, and because BankAm was a respectable franchise that had fared well.” The author elaborates on how Kapoor was introduced to Singh by Kapur, who chose to omit mentioning that they were related. Lall’s writing style is simple and easy to follow and he works hard to explain to readers complex banking terms and regulations of the Reserve Bank of India.
The book also lists the various companies floated by Kapoor, the business ventures of his daughters and wife and their various property transactions.
Where the book falls short perhaps, is in the fact that at times it brings nothing more to the table than what has already been reported in the news — after all, the YES Bank and Rana Kapoor saga has been widely written about since September 2018, when the RBI gave Kapoor about four months to step down. Lall has quoted extensively from news reports, so some readers may get a sense of deja vu at times.
One inadvertent error, which leaped out of the pages was on Page 53 when the author states: ‘Bank capital regulations at the RBI stated that for any bank that was licensed — which at that point were YES Bank, Kotak Mahindra Bank and Bandhan — the initial capital was around ₹200 crore….’
YES Bank and Kotak Mahindra Bank are contemporaries indeed, but Bandhan Bank had only received an in-principle approval from RBI for a universal bank in April 2014.
In recent years, where major financial institutions have been falling like dominoes, be it IL&FS, Punjab and Maharashtra Cooperative Bank, Dewan Housing Finance Corporation Ltd, YES Bank and Lakshmi Vilas Bank, questions about how and why promoters end up destroying something valuable they created, are foremost in people’s minds.
This book, to an extent, sheds light on one such tortuous journey of value creation, followed by callous destruction.