HDFC Bank wins all seven Bahrain cases over Credit Suisse AT1 bonds

HDFC Bank Ltd said that a Bahrain court has rejected all seven cases brought by investors who bought Credit Suisse additional tier-1 bonds through the bank, giving India’s largest private lender by assets a favorable outcome in a dispute over alleged mis-selling of the securities.

The Bahrain civil court issued favorable orders in two cases on 9 September, after rejecting five similar matters between July and August, HDFC Bank said in a statement on Thursday.

The outcomes remove a set of litigation involving allegations that the bank mishandled the sale of the high-risk securities, which were wiped out during UBS Group AG’s takeover of Credit Suisse in 2023.

The seven investors had alleged gross negligence, intentional misrepresentation, incorrect customer classification, non-disclosure of product features, misuse of financial leverage and violations of product-suitability principles in relation to their investments in the bonds.

HDFC Bank said the Bahrain court found that the investors had failed to provide sufficient admissible evidence to substantiate the allegations or establish that they suffered losses because of the bank. The investors were ordered to bear the costs of the proceedings, it said.

“This demonstrates the bank’s consistent success in defending claims against the bank of alleged breaches in connection with the investment in the CS AT1 Bonds,” HDFC Bank said.

AT1 bonds are high-risk bank securities that can be written down to absorb losses when a lender runs into financial distress.

India ruling backs HDFC Bank’s defence

The Bahrain decisions follow a March ruling by India’s National Consumer Disputes Redressal Commission, which dismissed complaints against HDFC Bank by investors in the Credit Suisse AT1 bonds. The commission held that the bank had acted as a facilitator and the investors had full autonomy to make their investments in CS AT1 Bonds as per their choice, the bank said

The bank said it would support customers where required but would not underwrite investments made on their own judgement.

“Therefore, the bank will defend itself rigorously against any unsubstantiated claims,” it said.

HDFC's Middle East sales under lens

Investments by individuals through HDFC Bank’s offices in the Middle East have come under scrutiny on more than one occasion.

Mint reported last month that a group of about 70 investors had come together to complain about how HDFC Bank sold them a high-yielding financial product. The investors said they represented about $12.5 million of an estimated $100 million raised from customers between 2017 and 2019. The product was pitched as a unique investment opportunity offering returns of 14-16%, according to members of the group.

In September 2025, HDFC Bank said the Dubai Financial Services Authority, the regulator of financial services in the Dubai International Financial Centre (DIFC), barred the bank’s branch in the special economic zone from conducting any business with new clients. Six months later, the bank said its board committee on governance pronounced staff accountability actions against a few employees, including terminating employment of three of them.

Former HDFC Bank chairman Atanu Chakraborty also referred to “mis-selling” of Credit Suisse perpetual bonds as a point of contention with the bank’s management in a CNBC-TV18 interview following his abrupt resignation in March. Chakraborty had said his decision was linked to certain practices that were “not in congruence” with his personal values and ethics.