Yes Bank To Move To Supreme Court Over ₹8,415 Cr AT1 Bonds

Yes Bank is preparing to seek a review of the Supreme Court judgment that left intact the quashing of its ₹8,415 crore AT1 bond write-down, while the Reserve Bank of India (RBI) is weighing whether to join the lender in the plea, the Economic Times reported.

The petition would be the bank’s next legal step after the top court on October 15 dismissed appeals filed by Yes Bank, the RBI and the government against a Bombay High Court order. That order had set aside the March 2020 write-down of the bonds, which comprise ₹3,000 crore issued in 2016 and ₹5,415 crore issued in 2017.

The RBI had backed the write-down as part of Yes Bank’s 2020 reconstruction. It is now seeking a legal opinion on the matter, the report said. The bank, meanwhile, is expected to exhaust all legal remedies available to it before taking a final call on how the bonds will be treated in its accounts and capital, the report added.

Yes Bank’s board is scheduled to meet on October 17 to review second-quarter results and will deliberate on the issue. According to the report, the ₹8,415 crore at stake will hit the bank’s core capital, which feeds into the capital adequacy ratio, and will not touch net profit.

In an exchange filing, the lender said it is going through the order and its implications in detail, weighing all legal options and next steps, and will make suitable disclosures in due course.

The filing also carried the bank’s first estimate of what reinstating the bonds would do to its capital. Bringing back the full ₹8,415 crore principal would lower its Common Equity Tier-1 (CET1) ratio by about 250 basis points on a pro-forma basis as of June 30, 2026, Yes Bank said. The figure is a pro-forma estimate and not a loss the bank has booked.

Its overall Tier-1 ratio, however, would stay at 14% on the same basis, because the revived bonds would again count as Additional Tier-1 capital. The estimate sits within the 230 to 300 basis point range that rating agencies and analysts had projected earlier for such a restoration.

The lender also sought to calm concerns over its capital position. It said it has access to suitable capital-management levers and can undertake additional actions if required to pursue its growth goals.

The court did not direct an immediate cash repayment of ₹8,415 crore, and it did not put a number on any liability arising from past coupons. The judgment therefore undoes the write-down without settling what the bank may ultimately owe. For now, the ₹8,415 crore is a capital question and not a payout the bank has to make today.

The financial impact will depend on how any further legal proceedings play out, as well as on the accounting treatment and the mechanism the bank adopts to reinstate the bonds.