Yes Bank Ltd. is re-entering the bond market after a private Indian creditor wrote off a risky local note in 2020. According to available information, the bank has hired arrangers for a dollar issuance.
Information obtained from sources wishing to remain anonymous due to data confidentiality indicates that the bank plans to sell a three-year US dollar note of a standard size and is negotiating with fixed-income investors starting Monday. This planned issuance comes as other Indian creditors have raised $5.27 billion over the past two months. The surge in demand was stimulated by Reserve Bank of India measures in June aimed at increasing capital inflow to support the rupee.
Previously, the creditor permanently wrote off the Additional Tier 1 debt obligations—notes that qualify as capital for banks and are hybrid securities that can be written down upon the breach of certain conditions—in March 2020. At that time, Indian authorities intervened to take control of Yes Bank, which was ultimately rescued by a consortium led by the country's largest lender, the State Bank of India.
Since then, Yes Bank has shown stable recovery. The banking division of Sumitomo Mitsui Financial Group Inc. acquired approximately 25% of the firm's shares in 2025, becoming its largest shareholder. Furthermore, Yes Bank has benefited from a series of rating upgrades on its various local currency notes over many years.
Crisil Ratings upgraded the bank's infrastructure bonds in rupees and Basel III compliant Tier 2 debt to AA+ in August, up from AA-, citing the sustained improvement in Yes Bank's earnings profile. These bonds were rated A- at the beginning of 2023.
Yes Bank's dollar bond holds a Ba1 rating from Moody’s Ratings and BB+ from S&P Global Ratings, which is one step below investment grade.
India's bond and credit markets have become active due to the sharp increase in dollar demand from Indian creditors who seek to increase leverage on foreign currency deposits offered to foreign nationals. This frenzy followed the central bank's campaign to attract capital from the country's diaspora of 35 million people, aiming to stabilize the rupee and replenish its foreign exchange reserves. Since June, India has attracted over $50 billion from its overseas citizens, prompting the Reserve Bank of India to close the special window for attracting foreign currency deposits a month earlier than scheduled.