Yes Bank AT1 bonds: Supreme Court overturns write-off, but will investors get coupon payments? What's the entire matter | Stock Market News
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Investors in Yes Bank's AT‑1 bonds may not receive the coupon payments due this year, affecting their returns even after the Supreme Court reversed the 2020 write‑off.
The Supreme Court recently reversed a decision that previously wiped out certain bonds issued by Yes Bank in the year 2020. Even though this ruling went against the write-off, financial experts suggest the institution probably will not distribute the interest payments scheduled for these specific financial instruments throughout the current year. Representatives for the lender indicate that complying with the payout obligations could significantly weaken their capital adequacy ratio by roughly two hundred fifty basis points. Consequently, the organization plans to challenge the verdict by filing a formal review petition, leaving the affected investors waiting for definitive answers regarding their overdue financial returns.
AT‑1 bonds are contingent capital instruments that banks issue to meet regulatory capital requirements; they typically pay high coupons but can be written down or have payments suspended if a bank's capital falls short of required levels.
- •Yes Bank’s filing for a review of the Supreme Court decision
- •Regulatory guidance on whether the bank must resume coupon payments
- •Any further changes to Yes Bank’s capital ratio that could trigger additional restrictions