Yes Bank AT1 writedown impact on mutual funds

Tue, 19 May 2026 00:00:00 +0000

In March 2020, the Reserve Bank of India’s Yes Bank rescue plan included a complete writedown of Additional Tier-1 (AT1) bonds issued by Yes Bank, causing approximately Rs 8,415 crore in losses to mutual funds and other AT1 holders. The writedown was a watershed event in Indian bond markets, demonstrating that AT1 bonds (perpetual bonds with loss-absorption features) carried real default risk despite their “regulatory capital” status.

For Indian mutual fund investors, the Yes Bank AT1 writedown caused significant NAV mark-downs in debt schemes that had invested in Yes Bank AT1 bonds. The event reshaped Indian mutual fund AT1 investment practices and led to regulatory tightening.

Writedown on WebNotes

Yes Bank AT1 writedown impact on mutual funds