American Marconi Wireless News - Yes Bank Petitions Supreme Court to Reverse AT-1 Bond Write-Off Ruling

India’s Yes Bank filed a petition in the Supreme Court on Friday seeking a review of a judgment that invalidated the write-off of ₹8,415 crore ($893.81 million) in its additional tier-1 (AT-1) bonds.

The legal challenge comes days after Axis Trustee Services, acting on behalf of bondholders, filed a contempt petition alleging that the lender failed to provide a concrete roadmap for restoring the bonds and implementing the court’s previous order.

Last month, the Supreme Court upheld a Bombay High Court ruling that set aside the write-off of Yes Bank’s AT-1 bonds. In its October order, the court stated that the bank’s administrator had acted under an "erroneous impression" that he retained the power to write down the bonds after the restructuring scheme was finalized. The court ruled that the write-off was "impermissible."

Yes Bank, in which Japan’s Sumitomo Mitsui Banking Corporation now holds a 24% stake, was declared insolvent six years ago. New investors were brought in under a restructuring scheme, and its AT-1 bonds were written off as part of that process.

Following the Supreme Court's ruling, Reuters reported that Yes Bank was unlikely to pay coupons due on the AT-1 bonds this year and planned to seek a review of the decision.

AT-1 bonds are high-risk debt instruments offering higher returns but can be written off or converted into equity when a bank comes under financial stress.

Ch.Havering--AMWN