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Yes Bank crisis | L&T moves Bombay HC over write-down of AT1 bonds: Reports

The RBI had on March 5 placed Yes Bank on a 30-day moratorium period, adding that the lender’s AT1 bonds will be written down.

March 12, 2020 / 08:49 PM IST
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Larsen & Toubro (L&T) has moved the Bombay High court over the Reserve Bank of India's decision on Yes Bank's Additional Tier 1 (AT1) bonds, according to media reports.

The central bank, on March 5, placed Yes Bank on a 30-day moratorium period, adding that the lender’s AT1 bonds would be written down.

L&T has an exposure of Rs 100 crore to Yes Bank’s AT1 bonds, as per industry estimates cited by the Business Standard.

The next hearing date in the case is March 12, The Economic Times reported.

Moneycontrol could not independently verify the reports.


AT1 bondholders, represented by Axis Trustee Services, have already moved the Bombay High Court to seek relief. The bondholders are negotiating a 70-80 percent haircut, rather than a full write-down of Yes Bank’s AT1 bonds, according to the media reports.

L&T is not agreeing with the proposed haircut, a source told ET.

Axis Trustee is working on a plan to convert the exposure into equity, the report added.

Bondholders have invested a total of nearly Rs 94,000 crore in AT1 bonds issued by Indian banks, according to rating agency ICRA. AT1 bonds, also called perpetual bonds, are considered quasi-equity instruments and are riskier than tier 1 bonds.
Moneycontrol News
first published: Mar 12, 2020 01:19 pm

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