Looking at your animation, your model is working properly. The model has conflicting constraints that are impossible to satisfy. There is a displacement constraint that moves the punch down, and there is a contact constraint. The problem is, the displacement commanded results in a gap less than the thickness (T) of the sheet.
The tip moves down till there is only a gap of T at the centerline. But on the 45 degree side of the die, the gap is 0.707*T which means the contact would have to allow penetration of the plate into the punch and die material. To resolve this conflict, the contact constraint fails and the plate springs back. Just reduce the displacement a little and it will converge without error.
If you replace the displacement with a force, then there would be no conflict. Once the gap on the 45 degree side became T, the punch would stop moving.