YES Bank Moves Supreme Court To Review ₹8,415 Crore AT-1 Bond Write-Down Ruling

YES Bank has submitted a review petition to the Supreme Court, challenging a recent ruling that overturned the lender's decision to write down Additional Tier-1 (AT-1) bonds worth ₹8,415 crore during its 2020 reconstruction. This move comes after the Supreme Court upheld a January 2023 judgment by the Bombay High Court, which had invalidated the complete write-down of the bonds.

The dispute revolves around two AT-1 bond issuances: one raised in December 2016 amounting to ₹3,000 crore at a 9.5% coupon rate, and another raised in October 2017 for ₹5,415 crore at a 9% coupon rate. Both bonds were written down by YES Bank in March 2020 during a reconstruction process initiated by the Reserve Bank of India (RBI) due to the bank's financial instability, mounting bad loans, and governance issues.

Axis Trustee Services, representing the bondholders, challenged the decision in May 2020 before the Bombay High Court, which ruled in favor of the bondholders in January 2023. The Supreme Court later upheld this decision, stating that annual coupon payments must follow the respective information memorandums, regardless of the appeal outcome.

The restoration of the bonds and associated investor rights is now being sought by Axis Trustee Services, with the potential for contempt proceedings if the bank is found to be non-compliant.