16. Accounting for Provisions, Contingent Liabilities
and Contingent Assets
In accordance with Accounting Standard 29,
"Provisions, Contingent Liabilities and Contingent
Assets" issued by ICAI, as notified under section
133 of the Companies Act, 2013, read together with
the Companies (Accounting Standards) Rules,2021,
a provision is recognized when the Bank has a
present obligation as a result of a past event and, it
is probable that an outflow of resources embodying
economic benefits will be required to settle the
obligation in respect of which a reliable estimate of
the amount of the obligation can be made.
Provisions are determined based on management
estimate required to settle the obligation at the
balance sheet date, supplemented by experience
of similar transactions. These are reviewed at each
balance sheet date and adjusted to reflect the
current management estimates. In cases where the
available information indicates that the loss on the
contingency is reasonably possible, but the amount
of loss cannot be reasonably estimated, a disclosure
is made in the financial statements as Contingent
Liability. No provision or disclosure of Contingent
Liability is made when there is a possible obligation
or a present obligation in respect of which likelihood
of outflow resources is remote. Contingent assets,
if any, shall not be recognized or disclosed in the
financial statements.
17. Operating Lease
Leases where the lessor effectively retains
substantially all the risks and benefits of ownership
over the lease term are classified as operating lease.
Lease payments for assets taken on operating lease
are recognised as an expense in the Profit and Loss
Account as per the lease terms in accordance with
AS-19, Leases.
Rental payments for premises taken on operating
lease agreements are recognized as an expense in
the profit and loss account over the lease term as the
lease are cancellable. Initial direct costs in respect
of operating leases such as legal costs, brokerage
costs etc are recognized as expense immediately in
the Profit and Loss Account.
18. Cash and cash equivalents
Cash and cash equivalents include cash in hand,
balances with Reserve Bank of India and balances
with other banks/institutions and Money at Call
and Short Notice (including the effect of changes
in exchange rates on cash and cash equivalents in
foreign currency).
19. Share issue expenses
Share issue expenses are adjusted from Securities
Premium Account as permitted by Section 52 of the
Companies Act, 2013 and in line with the respective
RBI guidelines issued from time to time.
20. Corporate Social Responsibility
Expenditure towards Corporate Social Responsibility
is recognized in the Profit and Loss Account in
accordance with Companies Act 2013.
21. Accounting of Priority Sector Lending Certificate
(PSLC)
In line with the RBI guidelines updated from time
to time, Bank trades in priority sector portfolio by
selling or buying PSLC, without transfer of risks or
loan assets in these transactions. The fee paid for
purchase of such PSLC is treated as an 'Expense' and
the fee received from the sale of PSLCs is treated as
'Other Income' in the Profit and Loss Account.
22. Accounting for Dividend
In terms of revised Accounting Standard (AS) 4
"Contingencies and Events occurring after the
Balance sheet date" as notified by the Ministry
of Corporate Affairs through amendments to
Companies (Accounting Standards) Amendment
Rules, 2016 dated March 30, 2016, Proposed
Dividend or Dividend declared after balance sheet
date are not shown as liability in current year
balance sheet. The effect of the proposed dividend
shall be reckoned in determining capital funds in the
computation of capital adequacy ratios in Financial
Year for which the dividend is declared. In case of
interim dividend, the same shall be reckoned in the
same quarter.
23. Cash Flows
Cash flow Statement has been prepared using the
Indirect Method prescribed under AS-3 Cash flow
statements.
SCHEDULE - 18: NOTES ON ACCOUNTS FORMING PART OF THE STANDALONE FINANCIAL STATEMENTS FOR
THE YEAR ENDED MARCH 31, 2026
A: Disclosures as per RBI's Master Directions on Disclosure in Financial Statements
Amounts in Notes forming part of the financial statements for the year ended March 31, 2026, are denominated in
Rupees Crore (unless specified otherwise) to conform to extant RBI guidelines.
1. Regulatory Capital
a) Composition of regulatory Capital
The Bank is subject to the capital adequacy guidelines stipulated by RBI, which are based on the framework
of the Basel Committee on Banking Supervision. As per Basel III and RBI guidelines, the Bank is required to
maintain a minimum Capital to Risk Weighted Assets Ratio (CRAR) of 9% {11.5% including Capital Conservation
Buffer (CCB)}, with minimum Common Equity Tier I (CET1) of 5.5% (8% including CCB). These guidelines on
Basel III have been implemented completely. The minimum CRAR required to be maintained by the Bank as
on 31st March 2026 is 11.50%. The Capital Adequacy Ratio of the Bank calculated as per Basel III Capital
Regulations is furnished below:
b) Draw Down from Reserves:
The Bank has not undertaken any draw down from reserves during the year ended March 31, 2026.
The Bank has not undertaken any draw down from reserves during the years ended March 31, 2025, except:
FY2024-25: Effective from April 01, 2024 the Bank had adopted the revised framework as detailed in RBI
Master Direction on Classification, Valuation and Operation of Investment Portfolio issued on September
12, 2023 ('RBI Investment Direction 2023'). Accordingly, as prescribed under the transition provisions of the
aforesaid framework the Bank has (1) transferred the balance in Investment Reserve Account as at March 31,
2024 of ?34.20 Crore to the general reserve (2) transferred the provision held for depreciation on investments
as at March 31, 2024 of ? 1,259.04 Crore to the General Reserve and accounted provision held for depreciation
on investments as per the revised framework of ? 1,225.26 Crore including adjustment due to amortization of
discount on securities classified under the Held to Maturity category resulting in ?33.78 Crore to the General
Reserve as on April 01, 2024. The tax effect of ? 33.78 Crore amounting to ? 8.50 Crore has been drawn down
from General reserve as permitted by RBI. The amount drawn down from general reserve amounting to ?8.50
Crore is credited to provision for tax.
Note: - During the current FY the Bank had exercised the call option on its 9.50% and 10.25% Tier-II bonds,
amounting to ?490.00 Crore and ?300.00 Crore respectively. These bonds, originally issued in November 2017
with a maturity of May 2028 and issued in September 2015 with a maturity of October 2025, were redeemed
early on September 12, 2025, and on maturity on October 31, 2025, respectively, as per terms of issue and after
obtaining prior approval from RBI and Board of Directors.
Total Subordinated debt of ? Nil (Previous Year: ?294.00 Crore) is reckoned for Tier II capital as per RBI
guidelines.
e) Capital Infusion:
Current Year: No capital is infused other than the allotment of shares through ESOS.
Previous Year: No capital is infused other than the allotment of shares through ESOS.
Details of movement in the paid-up equity share capital of the Bank are given below:
Classification of assets and liabilities under different
maturity buckets is based on the same estimates and
assumptions as used by the Bank for compiling the
returns submitted to the RBI, which has been relied
upon by the auditors.
Advances as on March 31,2025 include ?2,577.43 Crore
of Inter Bank Participation Certificate (IBPC), out of
which ?1,150 Crore is bucketed in '31 days and up to 2
months' bucket, ?650.63 Crore in 'over 2 months and
up to 3 months' bucket, and ?776.80 Crore in 'over 3
months and up to 6 months' bucket.
Off balance sheet items are not considered in maturity
pattern of assets and liabilities.
b) Liquidity Coverage Ratio (LCR)
i) Qualitative Disclosure around LCR
The Bank measures and monitors the LCR in
line with the Reserve Bank of India's circular
dated November 28, 2025 on "Asset Liability
Management" and associated guidelines if any
issued from time to time. The LCR guidelines
aim to ensure that a bank maintains an adequate
level of unencumbered High Quality Liquid
Assets (HQLAs) that can be converted into cash
to meet its liquidity needs for a 30 calendar day
time horizon under a significantly severe liquidity
stress scenario. At a minimum, the stock of liquid
assets should enable the bank to survive until
day 30 of the stress scenario, by which time it
is assumed that appropriate corrective actions
can be taken. Banks are required to maintain
High Quality Liquid Assets of a minimum of 100%
of its Net Cash Outflows from January 01, 2019.
The daily average LCR of the bank for the quarter
ended March 2026 is 119.74%.
The Bank has been maintaining HQLA primarily
in the form of SLR investments over and above
mandatory requirement, regulatory dispensation
allowed up to 2% of NDTL in the form of borrowing
limit available through Marginal Standing Facility
(MSF) and 16% of NDTL as Facility to Avail
Liquidity for Liquidity Coverage Ratio (FALLCR).
Bank has a well-diversified funding portfolio and
has a lower dependence on wholesale funds.
Retail deposits which are considered as stable
deposits from a liquidity perspective forms the
major funding source of the Bank. The Bank
intends to fund the short term cash outflows
from extremely liquid Government securities and
funding for estimated cash outflows considered
in LCR computation substantially flows from this
source. The Bank is managing its liquidity from
the centralized fund management cell attached
to Treasury Department, Mumbai.
g) Sale and transfer to/from HTM category/Permanent Category
During the year ended March 31, 2026, the aggregate book value of sales and transfer of securities to/from
HTM category did not exceed 5% of the book value of investments held in HTM category at the beginning of
the year.
In accordance with RBI guidelines, the 5% threshold limit referred to above is excluding the following:
i) The one-time transfers of securities to/from HTM category with the approval of Board of Directors permitted
to be undertaken by banks at the beginning of the accounting year.
ii) Additional shifting of securities explicitly permitted by the Reserve Bank of India from time to time and direct
sales from HTM for bringing down SLR holdings in HTM category consequent to a downward revision in SLR
requirement by RBI.
iii) Sales to Reserve Bank of India under pre-announced open market auctions.
iv) Repurchase of Government Securities by Government of India from banks.
v) Repurchase of State Development Loans by respective state governments under buyback/switch operations
and
vi) Additional shifting of securities explicitly permitted by the Reserve Bank of India.
e) Disclosure on Divergence in Asset Classification and Provisioning for NPAs:
RBI had completed the annual supervisory process for the FY 2024-25 and based on the same no divergence
in Asset Classification and Provisioning is reported.
f) Disclosure of Transfer of Loan Exposures
Disclosures as per Commercial Banks- Transfer and Distribution of Credit Risk Directions, 2025 Directions
dated November 28, 2025 for the loans transferred/acquired during the year ended March 31, 2026 are given
below:
g) Unhedged Foreign Currency Exposure
The Bank has in place a policy on managing credit risk arising out of unhedged foreign currency exposures of its
borrowers. The objective of this policy is to maximise the hedging on foreign currency exposures of borrowers
by reviewing their foreign currency exposures and encouraging them to hedge the unhedged portion. The
policy framework also articulates the methodologies for ascertaining the amount of unhedged foreign currency
exposures, estimating the extent of likely loss, estimating the riskiness of the unhedged position and making
appropriate provisions and capital charge as per extant RBI guidelines. In line with the policy, assessment of
unhedged foreign currency exposure is a part of credit appraisal while proposing limits or at the review stage.
Further, the Bank reviews the unhedged foreign currency exposure across its portfolio on a periodic basis. The
Bank maintains incremental provisions and additional capital for the unhedged foreign currency exposures of
its borrowers in line with the extant RBI guidelines. The Bank has maintained ? 14.35 Crores (previous year
? 10.71 Crore) as provision and ? 18.88 Crore (previous year ? 9.21 Crore) as additional capital for computation
of capital adequacy ratio on account of the unhedged foreign currency exposures of borrowers as at March
31, 2026.
d) Disclosures on Risk Exposure in Derivatives.
i) Qualitative Disclosure.
The Bank undertakes over the counter and exchange traded derivative transactions for Balance Sheet
management and also for proprietary trading/ market making. Bank offers derivative products to the
customers to enable them to hedge their exposure within the prevalent regulatory guidelines.
These transactions expose the Bank to various risks primarily credit, market, operational, legal, and
reputation. There is functional separation between the Front Office, risk and Back Office for undertaking
derivative transactions. The derivative transactions are governed by the Investment, forex and derivative
policy and market risk management policy of the Bank as well as by the extant RBI guidelines. Various
operational/risk limits are set up and actual exposures are monitored vis-a-vis the limits allocated. Risk
Limits are in place for risk parameters viz. VaR, Stop Loss, Dealer Limit, Deal size limit. Actual positions
are monitored against these limits on a daily basis and breaches, if any, are reported promptly. The MTM
position of the derivative portfolio is monitored on a regular basis. The impact on derivative portfolio on
account of the probable market movements are assessed on regular basis.
Bank deals in derivatives for hedging foreign currency assets/liabilities subject to the prevailing regulatory
guidelines encompassing forward exchange contract as per AS-11 and the currency swap to hedge currency
risk. Transactions for hedging and trading are recorded separately. For hedge transactions, the Bank
identifies the hedged item (asset or liability) at the inception of the transaction itself. These transactions
are accounted for as per Guidance Note on Accounting for Derivatives (revised 2021) issued by ICAI and
also mentioned in the RBI Master Direction on Classification, Valuation and Operation of Investment dated
November 28, 2025. The effectiveness is ascertained at the time of inception of the hedge and periodically
thereafter. Transactions related to foreign exchange forwards, Currency futures etc. are marked to market
(MTM) on the reporting dates and the MTM is accounted in the books. Collateral requirements for derivative
transactions are determined based on usual credit appraisal process. For the purpose of credit risk mitigation,
most of the deals have been contracted with Banks/ Major primary dealers and no default risk is anticipated
on the deals with them.
Foreign exchange forward contract has not been included in the above disclosure. The notional principal amount of
foreign exchange contracts classified as trading on March 31, 2026 amounted to ? 4,096.22 Crore (Previous Year ?
7,142.44 Crore) and mark to market position was asset of ? 90.78 Crore (previous year ?86.05 crore) and liability of
? 69.88 Crore (Previous year ? 50.80 crore). The notional principal amount of Foreign exchange contacts classified
as non-trading foreign currency swap as on March 31 2026 amounted to Nil (Previous year ?649.56 Crore).
The notional principal amounts of derivatives reflect the volume of transactions outstanding as at the Balance
Sheet date and do not represent the amounts at risk. Interest rate derivative represents interest rate swaps.
e) Credit Default Swaps
The bank has not undertaken any transactions in credit default swaps during the year ended March 31, 2026
and March 31, 2025.
8. Securitisation Transactions
The Bank has not undertaken any securitisation transactions during the year ended March 31, 2026 and March
31, 2025.
9. Off-balance Sheet SPVs sponsored
There are no SPVs sponsored by the Bank as at March 31, 2026 and March 31, 2025.
10. Transfers to Depositor Education and Awareness Fund (DEA Fund):
In accordance with the guidelines issued by the RBI, the Bank transfers the amount to the credit of any account
which has not been operated upon for a period of ten years or any deposits or any amount remaining unclaimed
for more than ten years to DEA Fund.
13. Disclosures on Remuneration
a) Information relating to the composition and mandate of the Nomination & Remuneration Committee.
Composition:
The Nomination & Remuneration committee of the Board consists of four members and one of the members is
member of Risk Management committee of the Board to facilitate effective governance of compensation. The
Chairperson Smt. Lakshmi R Srinivas is a retired Chief General Manager & Head-strategic Training Unit of State
Bank of India, having extensive knowledge and experience in Risk Management and Human Resource Management.
Sri. Jose Joseph Kattoor, Sri. M George Korah and Sri Paul Antony are the other members of the Committee as on
31st March 2026.
10. With respect to the variable pay, both cash and noncash Performance Linked Incentive Schemes, the
Committee is empowered to:
i. Draw up terms and conditions and approve the changes, if any, to the Performance Linked Incentive
schemes;
ii. Moderate the scheme on an ongoing basis depending upon the circumstances and link the same with
the recommendations of Audit Committee;
iii. Coordinate the progress of growth of business vis -a- vis the business parameters laid down by the
Board and Audit Committee and effect such improvements in the scheme as are considered necessary;
iv. On completion of the year, finalize the criteria of allotment of marks to ensure objectivity/equity.
v. To identify Material Risk Takers (MRTs) as per the recommendations made by MD & CEO and to fix
variable pay and other terms of payment including component (Cash and non-cash), deferment and
divergence clause in line with compensation policy and other RBI guidelines and other policies and
guidelines of the Bank.
11. The Committee shall also function as the Compensation Committee as prescribed under the SEBI (Share
Based Employee Benefits) Regulations, 2014 and is empowered to formulate detailed terms and conditions
of the Scheme, administer, supervise the same and to allot shares in compliance with the guidelines and
other applicable laws.
12. To obtain necessary clearances and approvals from regulatory authorities, appoint Merchant Bankers and
do such other things as may be necessary in respect of the Employees Stock Option Scheme.
13. To oversee the administration of Employee benefits, such as Provident Fund, Pension Fund, Gratuity,
Compensation for absence on Privilege/Sick/Casual Leave etc., which are recognized in accordance with
Accounting Standard-15 (revised) specified in the Companies (Accounting Standards) Rules, 2006.
14. The Committee may suggest amendments to any stock option plans or incentive plans, provided that all
amendments to such plans shall be subject to consideration and approval of the Board.
15. Any other matters regarding remuneration to WTDs/ MD & CEO and other staffs of the Bank as and when
permitted by the Board.
16. To conduct the annual review of the Compensation Policy and all other policies related to the functioning
of HR department and to submit recommendations to Board.
17. To fulfil such other powers and duties as may be delegated to it by the Board.
18. To review HR Strategy aligning with business strategy of the Bank.
19. To review the skill gaps and talent pool creation.
20. To do any other matters regarding remuneration to whole-time directors/ non-executive directors /part-
time chairman, Chief Executive Officers / Material Risk Takers (MRTs) and employees (risk control and
compliance staff and all other categories of staff) of the Bank including signing/ joining bonus occurring
in the context of hiring new staff and be limited to first year, in the form of share-linked instruments only,
as and when permitted by the Board. Such bonus will neither be considered part of fixed pay nor part of
variable pay.
21. To carry out any other function as is mandated by the Board from time to time and/or enforced by any
statutory notification, amendment or modification, as may be applicable.
b) Information relating to the design and structure of
remuneration processes and the key features and
objectives of remuneration policy.
• The Bank has formed the compensation
policy based on the Reserve Bank of India
guidelines vide its Circular No. DBOD.
No.BC.72/29.67.001/2011-12 dated January 13,
2012.
• Board approves the scale of pay to all employees
upto Scale IV as per the terms of agreement
signed by and between Indian Banks Association
(IBA) and SIB Workmen unions and Officer's
Associations. The Board from time to time,
on recommendation of the Nomination and
Remuneration Committee of Board, shall fix
compensation structure of executives in Scale V
and above (Executive Compensation Package).
• Further, the compensation structure for the Whole
Time Directors (WTDs) / Managing Director &
Chief Executive Officer (MD & CEO) of the bank
are subject to approval of Reserve Bank of India
in terms of Section 35B of the Banking Regulation
Act, 1949. The payment of compensation also
requires approval of the shareholders of the
Bank in the General Meeting pursuant to clause
95 of Articles of Association of the Bank read
with Section 197 of the Companies Act, 2013 and
Section 35B (1) of Banking Regulation Act 1949.
c) Description of the ways in which current and future
risks are taken into account in the remuneration
processes. It will include the nature and type of the
key measures used to take account of these risks.
The Board of Directors through the NRC shall exercise
oversight and effective governance over the framing
and implementation of the Compensation Policy.
Human Resource Management under the guidance
of MD & CEO shall administer the Compensation
and Benefit structure in line with the best suited
practices and statutory requirements as applicable.
For Material Risk Takers:
The Bank will refer to the Basel Committee on
Banking Supervision (BCBS) report entitled Range of
Methodologies for Risk and Performance Alignment
of Remuneration published in May 2011 for guidance
wherever required. It intends to enhance the banks'
and supervisors' understanding of risk-adjusted
remuneration. This report, by providing some
clarification on design of risk-adjusted remuneration
schemes, will support and facilitate the greater adoption
of sound practices in the banking sector. Some of the
key stipulations of the report are as under:
1. In order for incentive-based remuneration to work,
the variable part of remuneration will be truly and
effectively variable and can even be reduced to zero
in line with the symmetry principle defined by the FSB.
A key element that supervisors expect is the ability
for banks to demonstrate that the methodologies
they developed to adjust variable remuneration
to risk and performance are appropriate to their
specific circumstances.
2. The methodologies for adjusting remuneration to
risk and performance will also be consistent with the
general risk management and corporate governance
framework.
3. Performance measures and their relation to
remuneration packages will be clearly defined at the
beginning of the performance measurement period
to ensure that the employees perceive the incentives
mechanism. The usual annual determination of
bonuses will be based on rules, processes and
objectives known in advance, recognizing that some
discretion will always be needed.
4. Bank will use a combination of financial and non¬
financial measures to assess employee performance
and adapt the measurement to each employee's
specific situation. Qualitative factors (like knowledge,
skills or abilities) might play an important role when
it comes to judging and rewarding some activities-
particularly when these serve to reinforce the bank's
risk management goals.
5. The nature and extent to which risk adjustments
are needed depends first on the extent to which
performance measures capture risks, but in all
cases, some form of risk adjustment is needed as
remuneration is often awarded before the final
outcome of an activity is known. Risks taken need
to be estimated (ex-ante), risk outcomes observed
(ex post) and both ex ante estimates and ex post
outcomes will affect payoffs.
6. Risk adjustments need to take into account the
nature of the risks involved and the time horizons
over which they could emerge. The impact of
remuneration adjustments will be linked to actions
taken by employees and/or business units, and their
impact on the level of risk taken on by the bank.
7. The nature of the award process, which links the
variable remuneration of each individual employee
with bonus pools and the total amount of variable
remuneration at a bank's level, is also an area that will
be carefully considered by banks and supervisors,
as it directly influences how and when performance
and risk adjustment are or can be used.
8. Considering the above parameters, the Board
may approve suitable methodologies for fixing of
risk adjusted remuneration, as appropriate, based
on the recommendations of Risk Management
committee and review/approval of the Nomination
and Remuneration Committee on the same.
The compensation structure for the Whole-Time
Directors/ Chief Executive Officers / Material Risk
Takers (MRTs) of the bank shall be as under:
Fixed Pay and Perquisites
Based on the recommendations of the Nomination
and Remuneration Committee, and subject to the
approval of Reserve Bank of India(for MD & CEO and
Executive Directors), Board shall fix the fixed portion
of compensation payable which is reasonable, taking
into account all relevant factors including adherence to
statutory requirements and industry practice.
Variable Pay
In order to have a proper balance between the cash
and share-linked components in the variable pay,
the variable pay is to be structured in the form of
share-linked instrument (including Cash-linked Stock
Appreciation Rights (CSARs)), or a mix of cash and
share-linked instruments. Only in cases where the
compensation by way of share-linked instruments is not
permitted by law/regulations, the option to pay entire
variable pay in cash to be exercised.
The assessment of the variable pay will be based
on 'Key Performance Indicators' (KPI) achievement
of respective whole-time directors/ Chief Executive
Officers / Material Risk Takers (MRTs).
d) Description of the ways in which the bank seeks
to link performance during a performance
measurement period with levels of remuneration.
a) The factors taken in to account for the annual
review and revision in the variable pay and
performance bonus are:
• The performance of the Bank
• The performance of the business unit
• Individual performance of the employee
• Other risk perceptions and economic
considerations.
The criteria for identification of MRTs are subject to the
following:
The persons who satisfy the qualitative criteria and any
one of the quantitative criteria as detailed below:
(I) Standard Qualitative criteria
• Relate to the role and decision-making power
of staff members (e.g., General manager,
member of management body) having jointly or
individually, the authority to commit significantly
to risk exposures, etc.
AND
(II) Standard Quantitative Criteria:
• Their total remuneration exceeds a certain
threshold (to be recommended by MD & CEO to
NRC for approval); the determination of which
may be done prudently by the bank,
or
• They are included among the 0.3% of staff with
the highest remuneration in the bank,
or
• Their remuneration is equal to or greater than the
lowest total remuneration of senior management
and other risk-takers.
MD & CEO is considered as Material Risk Taker,
whose compensation will be guided by the provisions
applicable to WTD/CEO as per the policy. However,
the Board, on recommendation of NRC, will specify
additional Material Risk Takers (MRTs) whose actions
have a material impact on the risk exposure of the bank
from time to time. In this regard the Board has also
identified Executive Director, SGM & Head Treasury and
Executive Vice President till the retirement of the then
EVP on 31.05.2024 also as Material Risk Takers of the
Bank.
e) A discussion of the bank's policy on deferral and
vesting of variable remuneration and a discussion
of the bank's policy and criteria for adjusting
deferred remuneration before vesting and after
vesting.
• Variable Pay
In order to have a proper balance between the cash
and share-linked components in the variable pay,
the variable pay are to be structured in the form
of share-linked instrument (including Cash-linked
Stock Appreciation Rights (CSARs)), or a mix of
cash and share-linked instruments. Only in cases
where the compensation by way of share-linked
instruments is not permitted by law/regulations, the
entire variable pay can be in cash to be exercised.
The assessment of the variable pay will be based
on 'Key Performance Indicators' (KPI) achievement
of respective whole-time directors/ Chief Executive
Officers / Material Risk Takers (MRTs).
a. Limit on Variable Pay:
A. For Whole-Time Directors and Chief Executive
Officers
i. In compliance to the RBI Guidelines and other
applicable rules and regulations at least 50%,
should be variable and paid on the basis of
individual, business-unit and firm-wide measures
that adequately measure performance. The
total variable pay shall be limited to a maximum
of 300% of the fixed pay (for the relative
performance measurement period).
ii. In case variable pay is up to 200% of the fixed
pay, a minimum of 50% of the variable pay; and
in case variable pay is above 200%, a minimum of
67% of the variable pay should be via non-cash
instruments.
iii. In the event that an executive is barred by
statute or regulation from grant of share-linked
instruments, his/her variable pay will be capped
at 150% of the fixed pay, but shall not be less
than 50% of the fixed pay.
iv. The deterioration in the financial performance of
the bank should generally lead to a contraction
in the total amount of variable compensation,
which can even be reduced to zero.
B. For Material Risk Takers (MRTs)
i. In compliance to the RBI Guidelines and other
applicable rules & regulations 50% of total pay for
all MRTs should be variable pay and paid on the
basis of individual, business-unit and firm-wide
measures that adequately measure performance.
ii. 50% of the variable pay should be via non-cash
instruments.
iii. The deterioration in the financial performance of
the bank should generally lead to a contraction
in the total amount of variable compensation,
which can even be reduced to zero.
The Board will from time to time specify the
Material Risk Takers (MRTs).
b. Deferral of Variable Pay
i. For senior executives, including WTDs, and
other employees who are MRTs, a minimum of
60% of the total variable pay must invariably be
under deferral arrangements. Further, if cash
component is part of variable pay, at least 50%
of the cash bonus should also be deferred.
ii. However, in cases where the cash component
of variable pay is under ?25 lakh, deferral
requirements is not applicable.
c. Period of Deferral Arrangement
The deferral period should be for a period three
years. This would be applicable to both the cash
and non-cash components of the variable pay
arrangements.
d. Vesting:
Deferred remuneration should be spread out over
the course of the deferral period on a pro rata basis
as follows:
• not more than 33.33 % of the total deferred
variable pay should vest at the end of first year.
• Further, not more than 33.33 % of total deferred
variable pay should vest at the end of second
year.
Additionally, vesting should not take place more
frequently than on a yearly basis to ensure a proper
assessment of risks before the application of ex
post adjustments.
In case of employee's death or permanent disability,
whole of the deferred variable pay (Cash component)
shall immediately vest in the employee's legal heirs,
or the employee, as the case maybe.
e. Share-linked Instruments
Such instruments shall be included as a component
of variable pay. Norms for grant of share-linked
instruments should be framed by banks in
conformity with relevant statutory provisions and
should form part of the bank's compensation policy.
The details of share-linked instruments granted
should also be disclosed in terms of the disclosure
requirements stipulated in these Guidelines. Share-
linked instruments should be fair valued on the date
of grant by the bank using Black-Scholes model.
The Variable pay assessment should be considering
the following parameters
• The HR Dept in consultation with CFM Dept. has
to recommend that amount of Variable pool of the
bank each year to the Nomination and Remuneration
Committee.
• While recommending the variable Pool HR Dept
should establish the Linkage between the variable
pool at the bank level and the performance of the
bank vis-a-vis its financials and risk assumed.
• Further HR Dept. should also detail the linkage
between performance of various units/ functions/
divisions to performance of variable pool.
• There should be a prudent basis for distribution
of the overall variable pool between various units/
functions /divisions including various control and
assurance functions
• Performance thresholds as defined and assessed by
HR Dept. to be attained for being eligible for variable
compensation.
The same to be included and form part of Performance
Linked Incentive scheme.
Malus / Clawback
a) The deferred compensation should be subject
to malus/clawback arrangements in the event of
subdued or negative financial performance of the
bank and/or the relevant line of business in any year.
b) A set of situations as detailed below are hereby
identified, which require the invocation of the malus
and clawback clauses that may be applicable as
detailed below:
i. Applying of Malus / Clawback arrangement on
entire variable pay on occurrence of the following
Situations:
• identified fraud / misconduct by the executive
(whole-time directors, Chief Executive
Officers / Material Risk Takers (MRTs)
pertaining to the corresponding period for
which the clause to be applied.
ii. Applying of Malus / Clawback arrangement on
unvested portion of deferred variable pay on
occurrence of the following situation:
• Reporting of operating loss or more than 50%
fall in operating profit in any year
iii. Applying of Malus clause on unvested portion
of deferred variable pay on occurrence of the
following situation:
• Wherever the assessed divergence in bank's
provisioning for Non-Performing Assets
(NPAs) or asset classification exceeds the
prescribed threshold for public disclosure as
detailed below: (As referred in RBI circular No.
DBR.BP.BC.No.32/21.04.018/2018-19 dated
April 1, 2019, as amended from time to time),
a. the additional provisioning for NPAs
assessed by RBI exceeds 10 per cent of
the reported profit before provisions and
contingencies for the reference period,
and
b. the additional Gross NPAs identified by
RBI exceed 15 per cent of the published
incremental Gross NPAs for the reference
period
Further, in such situations, no proposal for increase
in variable pay (for the assessment year) shall be
entertained. In case the bank's post assessment Gross
NPAs are less than 2.0%, these restrictions will apply
only if criteria for public disclosure are triggered either
on account of divergence in provisioning (clause (a)) or
both provisioning (clause (a) and asset classification
(Clause (b)).
Any other act detrimental to the interest of the Bank
including and not restricted to violation of Code of
Conduct, violation of Framework for dealing with
Conflict of Interest, violation of rules and regulations of
the Bank, failure to discharge fiduciary and regulatory
duties - and in respect of which the Bank would reserve
the right to institute appropriate civil, criminal or other
proceedings at the risks, costs and consequences of
such individual's.
As part of the criteria for the application of malus and
clawback, the following period during which malus and/
or clawback can be applied will be 36 months from
application of the clause, covering at least deferral and
retention periods (a period of time after the vesting of
instruments which have been awarded as variable pay
during which they cannot be sold or accessed)
In case, the MRT(s) have resigned, retired or taken early
retirement or been terminated, the above provisions
of clawback shall apply subject to the thorough due
process for recovery of amounts adjudged.
Members of staff engaged in financial and risk control,
including internal audit, should be compensated in
a manner that is independent of the business areas
they oversee and commensurate with their key role
in the bank. Effective independence and appropriate
authority of such staff are necessary to preserve the
integrity of financial and risk management's influence
on incentive compensation. Back office and risk control
employees play a key role in ensuring the integrity of
risk measures. If their own compensation is significantly
affected by short-term measures, their independence
may be compromised. If their compensation is too low,
the quality of such employees may be insufficient for
their tasks and their authority may be undermined.
The mix of fixed and variable compensation for control
function personnel should be weighted in favour of
fixed compensation. Therefore, the requirement of
minimum 50% of total compensation to be paid in
the form of variable pay will not be applicable for this
category of staff. However, a reasonable proportion of
compensation has to be in the form of variable pay, so
that exercising the options of malus and/or clawback,
when warranted, is not rendered infructuous.
For calculating the Variable Pay of Risk Control and
Compliance Staff the 'Key Performance Indicators'
(KPI) will be totally different and the modalities of the
same will be recommended by the Nomination and
Remuneration Committee to the Board for approval.
f) Description of the different forms of variable
remuneration (i.e. cash and types of share linked
instruments) that the bank utilizes and the
rationale for using these different forms.
For Material Risk Takers
Both cash and non-cash Performance Linked Incentive
Schemes to those employees who are eligible for
incentives.
In this regard the Committee is empowered to:
i) Draw up terms and conditions and approve the
changes, if any, to the Performance Linked Incentive
schemes;
ii) Moderate the scheme on an ongoing basis depending
upon the circumstances and link the same with the
recommendations of Audit Committee;
iii) Coordinate the progress of growth of business
vis -a- vis the business parameters laid down by
the Board and Audit Committee and effect such
improvements in the scheme as are considered
necessary;
iv) On completion of the year, finalize the criteria of
allotment of marks to ensure objectivity/equity.
v) To identify Material Risk Takers (MRTs) as per the
recommendations made by MD & CEO and to fix
variable pay and other terms of payment including
component (Cash and non-cash), deferment and
divergence clause in line with compensation policy
and other RBI guidelines and other policies and
guidelines of the bank.
For Others
The Board will from time to time specify the Risk Control
and Compliance Staff.
a) Based on the recommendations of the Committee,
Board may fix the variable pay not exceeding 50% of
the fixed pay in a year. Within this ceiling, at higher
levels of responsibility, the proportion of variable
pay will be higher. The variable pay may be in cash,
or stock linked instruments or a mix of both.
b) 'Variable pay' means the compensation as fixed by
the Board on recommendation of the Committee,
which is based on the performance appraisal of
an employee in that role, that is, how well they
accomplish their goals. It may be paid as:
i. Performance Linked Incentives to those
employees who are eligible for incentives.
ii. Ex-gratia for other employees who are not
eligible for Performance linked Incentives.
iii. Bonus for those staff members who are eligible
for bonus under the Payment of Bonus Act, 1965
iv. Any other incentives, by whatever name called
having the features similar to the above.
c) The Board may adopt principles similar to that
enunciated for WTDs/CEOs, as appropriate, for
variable pay-timing, Malus/Clawback, guaranteed
bonus and hedging.
d) Employee Stock Option Scheme/Employee Stock
Option Plan as may be framed by the Board from
time to time in conformity with relevant statutory
provisions and SEBI guidelines as applicable.
1. Mr. Murali Ramakrishnan, former Managing Director & Chief Executive Officer was identified as MRT till 30-09¬
2023.
2. Mr. Thomas Joseph K, former Executive Vice President was MRT till his retirement on 31.05.2024
3. Mr. P R Seshadri, Managing Director & Chief Executive Officer is identified as MRT w.e.f 01-10-2023.
4. Mr. Dolphy Jose, Executive Director is identified as MRT w.e.f 15.07.2024.
5. Further, Board has identified Mr. Vinod A N, SGM & Head Treasury, as MRT w.e.f November 01, 2024.
f) Implementation of IFRS converged Indian Accounting Standards (Ind AS)
The Ministry of Corporate Affairs (MCA), Government of India notified the Companies (Indian Accounting
Standards) Rules, 2015 on February 16, 2015. Further, a press release dated January 18, 2016, was issued by
the MCA outlining the roadmap for implementation of IFRS converged Ind AS for banks. This roadmap required
banks to prepare Ind AS based standalone & consolidated financial statements for the accounting periods
beginning April 01, 2018 onwards, with comparatives for the periods ending March 31, 2018 or thereafter.
RBI, through its notification dated February 11, 2016, required all scheduled commercial banks to comply with
Ind AS for financial statements from the stated periods and also stated that early adoption of Ind AS is not
permitted. On April 05, 2018, the RBI had announced deferment of IND-AS implementation date by one year and
subsequently on March 22, 2019, the RBI has announced deferment of the implementation of IND AS by banks
till further notice.RBI has issued draft guidelines on Asset Classification, Provisioning and Income Recognition)
Directions replacing the existing incurred loss model with Expected Credit Loss.
Based on the guidelines issued by RBI, the Bank is gearing itself to bring the necessary systems and processes
in place to facilitate seamless transition to ECL. Bank has undertaken the following steps:
• Led by the MD & CEO, a cross-functional Steering Committee has been established to drive the Bank's
ECL implementation. The group oversees the progress and provides strategic oversight on technical
requirements, operational processes, business impact, and project management.
• The refinement of IT solution procured to automate the computation of Expected Credit Losses (ECL),
Effective Interest Rate, Fair valuation and other accounting changes mandated as per RBI guidelines are
under progress
• The Bank is submitting half yearly Proforma Ind AS financial statements to the RBI within the stipulated
timeline.
h) Disclosure of facilities granted to directors and their relatives
Bank has not extended any funded or non-funded (guarantees, Letter of Credit, etc) facilities to directors, their
relatives, companies or firms in which they are interested during the Financial year 2025-26 as covered under
section 20 of BR Act, 1949/ RBI Regulations issued in this regard.
i) Details of Single Counterparty Limit / Limit for Group of Connected Counterparties exceeded by the Bank
RBI has prescribed limits linked to bank's eligible capital base in respect of exposure to single counter party and
group of connected counter parties. During the year ended March 31, 2026 and March 31, 2025, the Bank was
within the limits prescribed by the RBI.
Provision for taxes credited from reserve
Note:- Effective from April 01, 2024 the Bank has adopted the revised framework as detailed in RBI Master Direction
on Classification, Valuation and Operation of Investment Portfolio issued on September 12, 2023 ('RBI Investment
Direction 2023'). Accordingly, as prescribed under the transition provisions of the aforesaid framework the Bank
has (1) transferred the balance in Investment Reserve Account as at March 31, 2024 of ? 34.20 Crore to the general
reserve (2) transferred the provision held for depreciation on investments as at March 31, 2024 of ? 1,259.04
Crore to the General Reserve and accounted provision held for depreciation on investments as per the revised
framework of ? 1,225.26 Crore including adjustment due to amortization of discount on securities classified under
the Held to Maturity category, resulting in ? 33.78 Crore to the General Reserve as on April 01, 2024. The tax effect
of ? 33.78 Crore amounting to ? 8.50 Crore has been drawn down from General reserve as permitted by RBI. The
amount drawn down from general reserve amounting to ? 8.50 Crore is credited to provision for tax.
6. Letter of Comfort (LoCs) issued by Banks:
The Bank has not issued any reportable Letter of Comfort on behalf of subsidiary during the year ended March
31, 2026 and March 31, 2025 respectively.
7. Inter-bank participation with risk sharing
The aggregate amount of participation purchased by the Bank, shown as advances as per regulatory guidelines,
outstanding as of March 3l, 2026 was ?2,234.68 Crore (Previous Year: ?2,577.43 Crore).
8. Fixed Assets
a) Fixed Assets as per Schedule 10 include Intangible Assets relating to Software and System Development
Expenditure which are as follows:
2. In compliance with the guidelines as per
annexure to SEBI circular No SEBI/HO/CFD/CMD1/
CIR/P/2021/662 November 22, 2021, The South
Indian Bank Ltd, being a listed bank, is not required
to provide the disclosures with respect to related
party transactions involving loans, inter-corporate
deposits, advances or investments made or given
by the bank.
3. As per the provisions of SEBI (LODR) Regulations,
2015 the following are not considered as related
party transactions:
a. The issue of specified securities on a preferential
basis, subject to compliance of the requirements
under the Securities and Exchange Board of India
(Issue of Capital and Disclosure Requirements)
Regulations, 2018;
b. The following corporate actions which are
uniformly applicable/offered to all shareholders
in proportion to their shareholding:
i. payment of dividend;
ii. subdivision or consolidation of securities;
iii. issuance of securities by way of a rights issue
or a bonus issue; and
iv. buy-back of securities.
c. Acceptance of fixed deposits at the terms
uniformly applicable/offered to all shareholders/
public, subject to disclosure of the same along
with the disclosure of related party transactions
every six months to the stock exchange(s), in the
format as specified by the Board:
d. Acceptance of current account deposits and
saving account deposits in compliance with the
directions issued by the Reserve Bank of India or
any other central bank in the relevant jurisdiction
from time to time:
Explanation: For the purpose of clauses (c) and
(d) above, acceptance of deposits includes
payment of interest thereon.
e. Retail purchases from any listed entity or its
subsidiary by its directors or its employees,
without establishing a business relationship and
at the terms which are uniformly applicable/
offered to all employees and directors.
Hence the above excluded transactions are not
reported except for Fixed deposit and interest
paid thereon and interest received for loan and
advances in line with the provisions
4. In compliance with the above guidelines and as per
annexure to SEBI circular No SEBI/HO/CFD/CMD1/
CIR/P/2021/662 November 22, 2021 transactions
such as acceptance of fixed deposits by banks,
undertaken with related parties, at the terms
uniformly applicable /offered to all shareholders/
public only are reported under deposit.
5. It is further provided under 4th provision to
Regulation 23 (9) that the remuneration and sitting
fees paid by the listed entity or its subsidiary to
its director, key managerial personnel or senior
management, except who is part of promoter or
promoter group, shall not require approval of Audit
Committee under this sub-regulation provided that
the same is not material in terms of the provisions
of sub-regulation (1) of the regulation 23 of SEBI
(LODR) Regulation 2015, all such transactions are
submitted to Audit committee for review.
6. The Bank, being a scheduled commercial bank,
as per Reserve Bank of India (Commercial Banks-
Interest Rate on Deposits), Direction, 2025 dated
November 28, 2025, has allowed additional interest
of one per cent per annum, over and above the rate
of interest mentioned in the schedule of interest
rates on savings or a term deposits of bank's staff
and their exclusive associations as well as on
deposits of Chairman, Managing Director or such
other Executives appointed for a fixed tenure.
7. Value of the related party transaction for deposit
is the balance in fixed deposit outstanding as on
31.03.2026
8. Regulation 23 of Listing regulations, as amended
from time to time, grant exemptions from seeking
approval of the Audit Committee for the transactions
entered into by and between the holding company
and its wholly owned subsidiary company, whose
accounts are consolidated with such holding
company and placed before the shareholders at the
general meeting for approval.
9. The CSR activity of Bank is carried out by a trust
formed by Bank in this regard. Since the Trust is
acting on behalf of Bank and amount are spent as
Bank's CSR expenditure, these transactions are not
treated as RPT.
10. In the closing balance of Deposits/ESOS, the
details of deposits/ESOS of directors/ KMP /their
relatives, who has retired or ceased to be KMP or
directors/ related party during the review period
were not included in reporting, as the same will
not be coming under the preview of Related Party
Transaction. The opening balance / interest paid and
received / remuneration paid during the period are
reported as part of RPT. Further for other persons
who were classified as Related parties during the
review period, the full transaction including opening
balance, closing balance for deposits and interest
paid and received (if any) during the review period
are considered in full and reported as RPT for better
compliance.
11. The outstanding in ESOS refers to number of options
granted to KMP/ subsidiary directors/ MD & CEO /
ED(being employees of the Bank)
12. None of the Directors/ KMPs/ relatives are holding
substantial shares/ securities of the Bank.
13. For half yearly reporting wherever PAN is not
available for any relatives, PAN of the respective
Director/KMP is mentioned in XBRL reporting
template.
14. Transactions with common directors of subsidiary
and Bank is shown under Directors.
11. Employee Benefits
a) Provident Fund:
Employees, who have not opted for pension plan
are eligible to get benefits from provident fund,
which is a defined contribution plan. Aggregate
contributions along with interest thereon are paid
on retirement, death, incapacitation or termination
of employment. Both the employee and the Bank
contribute a specified percentage of the salary to
the South Indian Bank Employees' Provident Fund.
The Bank has no obligation other than the monthly
contribution.
The Bank recognized ?0.25 Crores (Previous Year:
?0.24 Crores) for provident fund contribution in the
Profit and Loss Account.
b) New Pension Scheme:
As per the industry level settlement dated April 27,
2010, employees who joined the services of the
Bank on or after April 1, 2010 are not eligible for the
existing pension scheme whereas they will be eligible
for Defined Contributory Pension Scheme (DCPS)
in line with the New Pension Scheme introduced
for employees of Central Government. Towards
DCPS, employee shall contribute 10% of their pay
components and Dearness Allowance thereon and
the Bank will also make a contribution of 14%. There
is no separate Provident Fund for employees joining
on or after April 1, 2010.
The Bank recognized ? 84.57 Crores (Previous Year:
? 82.44 Crores) for DCPS contribution in the Profit
and Loss Account.
Notes:
(i) Discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet
date for the estimated term of obligations.
(ii) Expected rate of return on plan assets is based on the average long term rate of return expected on investments
of the funds during the estimated term of the obligations.
(iii) The estimates of future salary increases, considered in actuarial valuation, taken in to account the inflation,
seniority, promotion and other relevant factors.
j) Compensation for absence on Privilege / Sick / Casual Leave
The charge on account of compensation for privilege / sick / casual leave has been actuarially determined and
an amount of ? 28.59 Crore (Previous year ? 39.21 Crore) has been debited to Profit and Loss account.
The above information is as certified by actuary and relied upon by the auditor.
k) Provision for wage revision -NA
12. Micro Small and Medium Industries
Under the Micro, Small and Medium Enterprises Development Act, 2006 which came into force from 2 October,
2006, certain disclosures are required to be made relating to Micro, Small and Medium enterprises. Following
are the details of delayed payments to MSMED registered vendors.
13. Segment reporting
Business Segments have been identified and reported taking into account, the target customer profile, the
nature of product and services, the differing risks and returns, the organization structure, the internal business
reporting system and guidelines issued by RBI from time to time. The Bank operates in the following business
segments;
a) Treasury:
The treasury segment primarily consists of interest earnings on investments portfolio of the bank, gains or
losses on investment operations and earnings from foreign exchange business. The principal expenses of
the segment consist of interest expense on funds borrowed and other expenses. Segmental expenses are
allocated as per board approved policy.
b) Corporate / Wholesale Banking:
The Corporate / Whole sale Banking segment provides loans to corporate segment identified on the basis of
RBI guidelines. Revenues of this segment consist of interest earned on Loans made to corporate customers
and the charges / fees earned from other banking services. The principal expenses of the segment consist
of interest expense on funds borrowed and other expenses. Segmental expenses are allocated as per board
approved policy.
c) Retail banking:
The Retail Banking segment provides loans to non-corporate customers identified on the basis of RBI
guidelines. Revenues of this segment consist of interest earned on Loans made to non-corporate customers
and the charges / fees earned from other banking services. The principal expenses of the segment consist
of interest expense on funds borrowed and other expenses. Segmental expenses are allocated as per board
approved policy.
In accordance with RBI Presentation and Disclosure Directions,2025 dated November 28,2025,as amended,
the Bank had divided retail Banking into i) Digital Banking and ii) Other Retail Banking segments. Assets
of DBU consists of mainly credit card, preapproved personal loans, loan against deposits opened through
digital mode etc.
d) Other Banking Operations:
This segment includes income from para banking activities such as debit cards, third party product
distribution and associated costs. Segmental expenses are allocated as per board approved policy.
e) Unallocated
All items that cannot be allocated to reportable segments are included in unallocated portion.
Geographic segment
The Bank operations are predominantly confined within one geographical segment (India) and accordingly
this is considered as the only geographical segment. In accordance with RBI guidelines in regard to business
segments of banks, the bank has determined the business segments and the required disclosures are as
follows:
The Bank's pending litigations comprise of claims against the Bank by the clients and proceedings pending with
Income Tax authorities/GST/VAT/Service Tax Authorities. The Bank has reviewed all its pending litigations and
proceedings and has adequately provided for such liabilities where provisions are required and disclosed the
contingent liabilities wherever applicable (other than SCN's), in its financial statements. The Management believes
that the possibility of outflow of resources embodying economic benefits in these cases is possible but not
probable and hence no provision is required in these cases. However, the contingent liability has been disclosed
with respect to these cases.
15. Provision for long term contracts
The Bank has a process whereby periodically all long-term contracts (including derivative contracts) are
assessed for material foreseeable losses. At the year end, the bank has reviewed and recorded adequate
provision as required under any Law/Accounting Standards for material foreseeable losses on such long-term
contracts (including derivative contracts) in the books of account and disclosed the same under the relevant
notes in the financial statements.
17. Corporate social responsibility
Operating expenses include ?32.35 Crore (Previous Year ? 21.35 Crore) for the year ended March 31, 2026
towards Corporate Social Responsibility (CSR), in accordance with the Companies Act, 2013. The Bank has
spent 2% of its average net profit for the last three financial years as part of its CSR for the year ended March
31, 2026.
18. Investor education and protection fund
There has been no delay in transferring amounts, required to be transferred to the Investor Education and
Protection Fund by the Bank.
19. Operating Leases
Lease payments for assets taken on operating lease are recognized as an expense in the Profit and Loss
Account as per the lease terms. During the year an amount of ? 139.96 Crore (Previous year: ? 128.58 Crore)
was charged to Profit and loss account.
20. Disclosure as to Rule 11(e) of the Companies (Audit and Auditors) Rules, 2014
The Bank, as part of its normal banking business grants loans and advances, makes investment, provides
guarantees to and accept deposits and borrowings from its customers, other entities and persons. These
transactions are conducted after proper due diligence and ensuring adherence to all regulatory requirements
including "Know Your Customer" guidelines.
Other than the transactions described above which are carried out in the normal course of business, no funds
have been advanced or loaned or invested (either from borrowed funds or share premium or deposits or any
other sources or kinds of funds) by the Bank to or in any other persons or entities, including foreign entities
("intermediaries") with the understanding, whether recorded in writing or otherwise, that the Intermediary shall
lend or invest in party identified by or on behalf of the Bank ("Ultimate Beneficiaries"). The Bank has also
not received any funds from any parties (Funding Party) with the understanding that the Bank shall whether,
directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Funding Party
("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
21. Proposed Dividend
'The Board of Directors, has proposed a dividend of ? 0.45 per equity share (45%) for the year ended March 31,
2026 amounting to ? 117.79 crore. The proposal is subject to the approval of shareholders at the Annual General
Meeting. In terms of revised Accounting Standard (AS) 4 'Contingencies and Events occurring after the Balance
sheet date' as notified by the Ministry of Corporate Affairs through amendments to Companies (Accounting
Standards) Amendment Rules, 2016, dated March 30, 2016, proposed dividend is not recognised as a liability as
on March 31, 2026. However, effect of the proposed dividend has been reckoned in determining capital funds
in the computation of capital adequacy ratios as at March 31, 2026.
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