New Delhi, October 16, 2026 (Yes Punjab News)
Shares of Yes Bank fell nearly 4 per cent on Friday as brokerages flagged renewed concerns over the lender’s capital position and book value following the Supreme Court’s decision to uphold the quashing of its Rs 8,415-crore Additional Tier-1 (AT-1) bond write-off.
Global brokerage Citi retained its ‘sell’ rating on the stock and cut its target price to Rs 17.50. Morgan Stanley maintained its ‘underweight’ rating with a target price of Rs 17, citing uncertainty over the financial implications of the verdict.
The Supreme Court dismissed appeals filed by Yes Bank, the Reserve Bank of India and the Centre against the Bombay High Court’s January 20, 2023, judgment that quashed the write-down of AT-1 bonds extinguished during the bank’s reconstruction in March 2020.
Citi said the reversal of the write-off had reopened concerns about the bank’s capital adequacy. Based on the principal amount alone, the brokerage estimated that the development could reduce Yes Bank’s Common Equity Tier 1 (CET1) capital ratio by 250 basis points to 11.5 per cent, assuming coupon payments are discretionary and non-cumulative.
The brokerage also warned that the potential liability could erode the bank’s book value by 13-14 per cent, potentially requiring a capital raise to rebuild its capital buffers. The final impact, however, would depend on how the ruling is implemented and how the outstanding bonds are treated.
Morgan Stanley described the verdict as prima facie negative and said further clarity was needed on the proportion of AT-1 bonds that could ultimately be written off.
It estimated that the post-tax impact of Rs 6,300 crore would account for around 12 per cent of Yes Bank’s net worth and could reduce its current CET1 ratio of 14 per cent by approximately 190 basis points.
The brokerage said the AT-1 bond dispute had remained an overhang on the stock and would monitor any review petition and further clarification from the bank.
Morgan Stanley also raised a key question over whether the ruling fundamentally challenged the loss-absorption mechanism of AT-1 bonds or was primarily concerned with the procedure followed by the administrator during Yes Bank’s reconstruction.
On the stock market, Yes Bank shares fell as much as 3.85 per cent to Rs 17.45 on the BSE by 12.30 pm on Friday. The stock had hit its lower circuit limit of Rs 18.03 on Thursday.
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