Private sector lender Yes Bank has yet to decide on the coupon payment on its Additional Tier 1 (AT-1) bonds, saying it retains the right to exercise discretion over such payments under the terms of the bonds.
In an exchange filing on Saturday, the bank said it was continuing to evaluate the Supreme Court judgment setting aside the write-off of AT-1 bonds worth Rs 8,415 crore in March 2020, including assessing the options and actions available to it.
The bank said it had been receiving queries from certain bondholders regarding coupon payments. The 9 per cent AT-1 bonds, issued under the terms of an information memorandum dated October 17, 2017, had a coupon payment date of October 18, 2026.
“Given that the Bank has not completed the evaluation and assessment, the Bank will communicate its decision, if any, on whether or not exercise of coupon discretion is required in respect of the AT-1 Bonds after it has completed the evaluation and assessment,” the bank said.
Yes Bank expects to complete its assessment in due course and will make further disclosures as required under the listing regulations.
The Supreme Court this month upheld the Bombay High Court’s decision to set aside Yes Bank’s AT-1 bond write-off, ruling that the bank’s administrator had acted beyond his authority and contrary to the applicable regulatory framework. A Bench of Justices Dipankar Datta and Augustine George Masih declined to interfere with the High Court’s January 20, 2023, judgment, which had set aside the write-off announced on March 14, 2020. The Bench also observed that the Reserve Bank of India had remained a “mere bystander” while Yes Bank’s Common Equity Tier 1 (CET1) ratio fell to 0.6 per cent.
Yes Bank had said that reinstating the bonds’ principal would have a pro forma impact of 250 basis points on its CET1 ratio as of June 30, 2026, while its Tier 1 capital ratio would remain unchanged at 14 per cent.
The bank said its day-to-day operations and customer services continued without interruption across branches and digital channels.
