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₹0 to ₹8,415 cr

of Yes Bank AT-1 bonds, written to zero in 2020, revived

Yes Bank's ₹8,415 crore AT-1 bonds return after Supreme Court ruling

Companies No. 76 17 October 2026 · 1 min read

On 15 October 2026, the Supreme Court restored ₹8,415 crore of Yes Bank's AT-1 bonds, which had been written off during the bank's rescue in March 2020. AT-1 bonds are a type of bank debt that can be written off when a bank gets into trouble.

The ruling came down to 1 detail. The RBI's draft rescue plan said the bonds would be permanently written off, but the final plan removed that line. The court ruled that the RBI's administrator had no authority to write them off without it.

The decision brings ₹8,415 crore of debt back onto Yes Bank's books. The bank says its core equity ratio will fall from 14.0% to about 11.5%, leaving it with a smaller cushion to absorb losses. Bondholders regain their claim on the bank, with interest rates of 9.5% on ₹3,000 crore issued in 2016 and 9.0% on ₹5,415 crore issued in 2017. Together, these amount to about ₹772 crore in annual interest. Whether bondholders are owed interest missed since 2020 remains undecided.

The court also noted that Yes Bank had sold these bonds to ordinary investors against RBI rules. The takeaway: bondholders who were told their money was gone in 2020 have their claim back, while Yes Bank faces a potential annual interest bill of ₹772 crore and a thinner cushion to absorb losses.

How Yes Bank's AT-1 bonds went to zero and came back

The draft rescue plan wrote the bonds off. The final plan did not, and the administrator did it anyway.

Timeline of Yes Bank's AT-1 bonds: Yes Bank sold ₹8,415 crore of them in 2016 and 2017; on 6 March 2020 the RBI's draft rescue plan wrote them off; on 13 March the final plan left that line out; on 14 March the administrator wrote them off anyway; on 20 January 2023 the Bombay High Court called the write-off void; on 15 October 2026 the Supreme Court agreed and the bonds came back.

Supreme Court judgment of 15 October 2026; Gazette of India; RBI; Yes Bank BSE filings · 2016 to 2026

Yes Bank's equity layer falls 2.5 points, Tier-1 stays at 14%

Yes Bank's Tier-1 capital as a share of risk-weighted assets at 30 June 2026, before and after the ruling. The ₹8,415 crore leaves equity and comes back as AT-1, so the total does not move.

Yes Bank's Tier-1 capital as a share of risk-weighted assets at 30 June 2026: as reported, all 14.0% is CET-1, the equity layer; with the bonds reinstated, CET-1 falls to about 11.5% and AT-1 makes up the other 2.5%, so Tier-1 stays at 14.0%.

% OF RISK-WEIGHTED ASSETS

CET-1, the equity layerAT-1, the rest of Tier-1

After the ruling: CET-1 is 14.0% less the 2.5 points Yes Bank expects, including profits. AT-1 is the rest of the 14.0% Tier-1 the bank says is unchanged. Pro forma, as stated on 16 October 2026.

Yes Bank, BSE filings of 18 July 2026 (Q1 FY27 results) and 16 October 2026 · 30 Jun 2026, pro forma

Yes Bank's revived bonds carry about ₹772 crore of coupon a year

The annual coupon on the 2 revived series at their issue rates, in ₹ crore. The court says coupons are to be paid as the bond documents provide; the RBI's rules let a bank cancel one.

₹ CRORE A YEAR

  • December 2016 series: 9.5% on ₹3,000 crore
  • October 2017 series: 9.0% on ₹5,415 crore
The yearly coupon on Yes Bank's 2 revived AT-1 series, about ₹772 crore: ₹285 crore at 9.5% on the ₹3,000 crore December 2016 series and ₹487 crore at 9.0% on the ₹5,415 crore October 2017 series.

9.5% of ₹3,000 crore is ₹285 crore; 9.0% of ₹5,415 crore is ₹487 crore. Whether coupons missed since March 2020 are owed is not decided in the judgment.

Supreme Court judgment of 15 October 2026 (the RBI's table of the series); RBI Master Circular on Basel III Capital Regulations · Per year, at issue rates

Sources