Several months after the YES Bank AT-1 (Additional Tier-1) bonds' complete failure, the market regulator SEBI has attempted to revive the debt instruments. SEBI said that the AT-1 bonds will be restricted to qualified institutional buyers (QIBs) only. SEBI has said that the minimum lot size of the bonds which a single player can subscribe to will be ₹1 crore.

AT-1 bonds are complex hybrid instruments and meant for institutions and smart investors. These institutions and investors can decipher their terms and assess if their higher rates compensate for their higher risks. But in India, these bonds seem to have been sold to a fair number of retail investors as fixed deposit or NCD (non-convertible debenture) substitutes.  AT-1 bonds are quasi-equity instruments that are meant to be or deemed equity. But in the YES Bank's case, were structured as bonds. The promise of equity is giving money to companies to grow and seeking no dividend in return. But the capital is deemed to be secured with some interest in it. The YES Bank AT-1 bonds were subscribed by retail investors, who later lost a huge amount of money as bonds worth ₹8,500 crores were written off by the lender.

SEBI made it clear that these bonds should be issued only on exchange platforms. Further, the issuers will have to come out with disclosure prospectus and make the risk factors known during the issue. SEBI has made it clear that the details of all the conditions upon which the call option exercised by AT-1 bonds; should be mentioned in the Information/Private Placement Memorandum. AT-1 bonds are unsecured, perpetual bonds that banks issue to shore up their core capital base to meet the Basel-III norms. In case the RBI feels that a bank is tottering on the brink and needs a rescue. It can ask the bank to cancel its outstanding AT-1 bonds without consulting its investors.