InvestorQ : Why has SEBI put a penalty of Rs.25 crore on Yes Bank?
Lavanya Subramanian made post

Why has SEBI put a penalty of Rs.25 crore on Yes Bank?

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Anamika Sodhani answered.
4 weeks ago
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SEBI slapped a penalty of Rs.25 crore on Yes Bank and this pertains to the mis-selling of AT-1 bonds or Additional Tier-1 bonds by the officials of the bank to naïve customers. This penalty was imposed by SEBI as Yes Bank had sold these high-risk bonds to customers without explaining the risk factors and had deliberated to position these AT-1 bonds as a safe investment at par with FDs.

When RBI worked out a rescue plan for Yes Bank in March 2020, one of the conditions for SBI taking over Yes Bank was that the entire amount of AT-1 bonds issued by Yes Bank would be written down to zero. It is reported that the mis-selling was so intense that a number of unsuspecting investors, including senior citizens, had been coaxed to liquidate their bank FDs and invest in AT-1 bonds, putting their monies at huge risk

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