They may end up taking a complete write-down. AT1 bonds are perpetual bonds used by banks to raise quasi equity capital. As part of the revamp package of Yes Bank, the RBI has written off AT1 bonds to the tune of Rs.8500 crore. Nearly 30% of these AT1 bonds were sold to mutual funds and these debt funds may end up passing on these losses to the investors. The sad part is that many senior citizens have also invested in these bonds because they have been mis-sold these bonds by Yes Bank executives!