YES Bank Q2 FY27 Results: Net Profit Rises 65% to ₹1,080 Crore, But AT1 Bond Ruling Could Trigger A ₹5,217 Crore Loss
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YES Bank reported a 65% year-on-year rise in Q2 FY27 net profit to ₹1,080 crore. However, recognising the Supreme Court’s AT1 bond ruling could turn the quarterly profit into a ₹5,217 crore post-tax loss.
YES Bank reported a 65% year-on-year rise in net profit to ₹1,080 crore for the September quarter. However, the reported earnings do not reflect the potential financial impact of the Supreme Court judgment concerning the bank’s Additional Tier-1 (AT1) bonds.
The Supreme Court on 15 October upheld the Bombay High Court judgment setting aside YES Bank’s 2020 decision to write down the bonds worth ₹8,415 crore. The bank is examining the financial and accounting implications and the legal remedies available to it.
The YES Bank share price closed at ₹17.50 on 16 October 2026, down 3.42% for the session on the National Stock Exchange (NSE).
How Could The AT1 Bond Judgment Affect YES Bank?
YES Bank’s pro-forma calculations indicate that recognising the estimated impact of the judgment would have resulted in a post-tax loss of ₹5,217 crore for the quarter, instead of the reported profit. The bank’s auditors also cautioned that its reported financial performance could have been materially different had the impact been recognised.
The adjustment would reduce the bank’s net worth to ₹46,970 crore from ₹53,268 crore. Borrowings would rise to ₹86,149 crore from ₹77,734 crore, while the pro-forma return on assets would fall to negative 4.3% from the reported 0.9%.
Managing Director and Chief Executive Officer Vinay Tonse said the bank was examining the matter in detail and would take appropriate steps in line with applicable legal and regulatory requirements.
What Supported Profit Growth In Q2 FY27?
Net interest income increased 22.7% year-on-year to ₹2,822 crore. Other income rose 14.4% to ₹1,882 crore, while provisions for bad loans and other contingencies declined 24.2% to ₹317 crore.
Advances grew 23.7% year-on-year and deposits increased 19.5%. The gross non-performing asset ratio improved to 1.2% at the end of September from 1.3% at the end of June.
Although the reported profit growth and improvement in asset quality are positive operating indicators, the AT1 bond judgment remains a significant uncertainty. YES Bank is evaluating the judgment’s financial and accounting implications and possible legal options.
This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Vishwa has spent 10+ years across fintech and FMCG doing what most people miss, connecting the dots, catching trends before they trend, and finding the angle nobody else thought to ask about.
At Kotak Neo, she drives content strategy for neoshorts, Kotak News Desk, and Investing Guide, turning market noise into something worth reading.
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