DRAFT RED HERRING PROSPECTUS

Please read Section 32 of the Companies Act, 2013

Dated March 30, 2015
(The Draft Red Herring Prospectus will be updated upon filing with the RoC)
100% Book Building Issue

THE CATHOLIC SYRIAN BANK LIMITED

Our Bank was incorporated on November 26, 1920 under the Indian Companies Act, 1913 as ‘The Catholic Syrian Bank Limited’. A fresh certificate of incorporation under the Companies Act, 1956 was issued by the Registrar of
Companies, Kerala at Ernakulum (“RoC”) on April 14, 1987. For details of changes in the registered office of our Bank, see the section titled “History and Certain Corporate Matters” on page 165.
Registered Office: CSB Bhavan, Post Box 502, St. Mary’s College Road, Thrissur 680 020, Kerala, India
Contact Person: Mr. Sijo Varghese, Company Secretary and Compliance Officer; Telephone: +91 487 6619 228; Facsimile: +91 487 2333 170
E-mail: [email protected]; Website: www.csb.co.in, Corporate Identification Number: U65191KL1920PLC000175

Our Bank is a professionally managed company and does not have a promoter in terms of the SEBI Regulations (as hereinafter defined) and the Companies Act, 2013
INITIAL PUBLIC ISSUE OF [●] EQUITY SHARES OF FACE VALUE OF ` 10 EACH (“EQUITY SHARES”) OF THE CATHOLIC SYRIAN BANK LIMITED (OUR “BANK” OR THE
“ISSUER”) FOR CASH AT A PRICE OF ` [●] PER EQUITY SHARE INCLUDING A SHARE PREMIUM OF ` [●] PER EQUITY SHARE, AGGREGATING UP TO ` 4,000 MILLION (THE
“ISSUE”). THE ISSUE INCLUDES A RESERVATION OF UP TO [●] EQUITY SHARES FOR THE ELIGIBLE EMPLOYEES (THE “EMPLOYEE RESERVATION PORTION”)
AGGREGATING UP TO ` 100 MILLION. THE ISSUE LESS THE EMPLOYEE RESERVATION PORTION IS REFERRED TO AS THE “NET ISSUE”. THE ISSUE AND THE NET ISSUE
SHALL CONSTITUTE [●] % AND [●] % OF THE FULLY DILUTED POST ISSUE PAID UP EQUITY SHARE CAPITAL OF OUR BANK, RESPECTIVELY.
Our Bank, in consultation with the BRLMs, is considering a private placement of up to 12,500,000 Equity Shares for cash consideration aggregating up to ` 1,500 million, at its discretion,
prior to filing of the Red Herring Prospectus with the RoC ("Pre-IPO Placement"). If the Pre-IPO Placement is completed, the number of Equity Shares issued pursuant to the Pre-IPO
Placement will be reduced from the Issue, subject to a minimum Net Issue size of 25% of the post Issue paid-up equity share capital being offered to the public.
THE FACE VALUE OF THE EQUITY SHARE IS ` 10 EACH
THE PRICE BAND AND THE MINIMUM BID LOT WILL BE DECIDED BY OUR BANK IN CONSULTATION WITH THE BOOK RUNNING LEAD MANAGERS (“BRLMS”), AND
ADVERTISED IN [●] EDITIONS OF [●], [●] EDITIONS OF [●] AND [●] EDITIONS OF [●] (WHICH ARE WIDELY CIRCULATED ENGLISH, HINDI AND MALAYALAM NEWSPAPERS,
AT LEAST FIVE WORKING DAYS PRIOR TO THE BID OPENING DATE AND SHALL BE MADE AVAILABLE TO THE BSE LIMITED (“BSE”) AND THE NATIONAL STOCK
EXCHANGE OF INDIA LIMITED (“NSE”, TOGETHER WITH BSE, THE “STOCK EXCHANGES”) FOR THE PURPOSE OF UPLOADING ON THEIR WEBSITES.
In case of any revision in the Price Band, the Bidding Period shall be extended for at least three Working Days after such revision of the Price Band, subject to the total Bidding Period not exceeding 10
Working Days. Any revision in the Price Band, and the revised Bidding Period, if applicable, shall be widely disseminated by notification to the BSE and the NSE, by issuing a press release and also by
indicating the change on the website of the BRLMs, at the terminals of the Syndicate Members and by intimation to Self Certified Syndicate Banks (“SCSBs”) and Registered Brokers.
Pursuant to Rule 19(2) (b) (i) of the Securities Contracts Regulation Rules, 1957, as amended (“SCRR”), the Net Issue is being made for at least 25% of the post-Issue paid-up equity share capital of our Bank. The
Issue is being made through the Book Building Process in accordance with Regulation 26(1) of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as
amended (the “SEBI Regulations”), wherein 50% of the Net Issue shall be available for allocation on a proportionate basis to Qualified Institutional Buyers (“QIBs”). Our Bank may, in consultation with the BRLMs,
allocate up to 60% of the QIB Portion to Anchor Investors at the Anchor Investor Allocation Price, on a discretionary basis, out of which at least one-third will be available for allocation to domestic Mutual Funds
only. In the event of under-subscription or non-allocation in the Anchor Investor Portion, the balance Equity Shares shall be added to the Net QIB Portion. Such number of Equity Shares representing 5% of the Net
QIB Portion shall be available for allocation on a proportionate basis to Mutual Funds only. The remainder of the Net QIB Portion shall be available for allocation on a proportionate basis to QIBs, subject to valid Bids
being received from them at or above the Issue Price. However, if the aggregate demand from Mutual Funds is less than 5% of the Net QIB Portion, the balance Equity Shares available for allocation in the Mutual
Fund Portion will be added to the remaining Net QIB Portion for proportionate allocation to QIBs. Further, not less than 15% of the Net Issue shall be available for allocation on a proportionate basis to Non
Institutional Bidders and not less than 35% of the Net Issue shall be available for allocation to Retail Individual Bidders in accordance with the SEBI Regulations, subject to valid Bids being received from them at or
above the Issue Price such that, subject to availability of Equity Shares, each Retail Individual Bidder shall be Allotted not less than the minimum Bid Lot, and the remaining Equity Shares, if available, shall be allotted
to all Retail Individual Bidders on a proportionate basis. All investors, other than Anchor Investors, can participate through the Applications Supported by Blocked Amount (“ASBA”) process by providing the
details of their respective bank accounts in which the corresponding Bid Amount will be blocked by the SCSBs. However, QIBs (excluding Anchor Investors) and Non-Institutional Bidders are mandatorily
required to submit their Bids by way of ASBA only. For details, see the section titled "Issue Procedure" on page 367.
RISKS IN RELATION TO THE FIRST ISSUE
This being the first public issue of our Bank, there is no formal market for the Equity Shares. The face value of the Equity Shares is ` 10 each and the Floor Price is [●] times of the face value and the Cap
Price is [●] times of the face value. The Issue Price as determined and justified by our Bank in consultation with the BRLMs in accordance with the SEBI Regulations and as stated in the section titled “Basis
for the Issue Price” on page 99 should not be taken to be indicative of the market price of the Equity Shares after such Equity Shares are listed. No assurance can be given regarding an active and/or sustained
trading in the Equity Shares or regarding the price at which the Equity Shares will be traded after listing.
GENERAL RISKS
Investments in equity and equity-related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their entire investment.
Investors are advised to read the risk factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of our Bank and this
Issue, including the risks involved. The Equity Shares have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”), nor does SEBI guarantee the accuracy or adequacy of
the contents of this Draft Red Herring Prospectus. Specific attention of the investors is invited to the section titled “Risk Factors” on page 13.
ISSUER’S ABSOLUTE RESPONSIBILITY
Our Bank, having made all reasonable inquiries, accepts responsibility for and confirms that this Draft Red Herring Prospectus contains all information with regard to our Bank and this Issue, which is
material in the context of this Issue, that the information contained in this Draft Red Herring Prospectus is true and correct in all material aspects and is not misleading in any material respect, that the opinions
and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Draft Red Herring Prospectus as a whole or any of such information or the expression of
any such opinions or intentions, misleading, in any material respect.
LISTING
The Equity Shares offered through the Red Herring Prospectus are proposed to be listed on the Stock Exchanges. Our Bank has received in-principle approvals from the BSE and the NSE for listing of the
Equity Shares pursuant to their letters dated [●] and [●], respectively. For the purposes of this Issue, the [●] shall be the Designated Stock Exchange.
BOOK RUNNING LEAD MANAGERS REGISTRAR TO THE ISSUE

ICICI SECURITIES LIMITED KOTAK MAHINDRA CAPITAL COMPANY LIMITED LINK INTIME INDIA PRIVATE
ICICI Centre 27 BKC, 1st Floor, Plot No. C-27 LIMITED
H.T. Parekh Marg ‘G’ Block, Bandra Kurla Complex C-13, Pannalal Silk Mills Compound
Churchgate Bandra (East) L.B.S. Marg, Bhandup (West)
Mumbai 400 020 Mumbai 400 051 Mumbai 400 078
Telephone: +91 22 2288 2460 Telephone: +91 22 4336 0000 Telephone: +91 22 6171 5400
Facsimile: +91 22 2282 6580 Facsimile: +91 22 6713 2447 Facsimile: +91 22 2596 0329
Email ID: [email protected] Email ID: [email protected] Email ID: [email protected]
Website: www.icicisecurities.com Website: www.investmentbank.kotak.com Website: www.linkintime.co.in
Investor grievance email: [email protected] Investor grievance email: [email protected] Investor grievance email:
Contact Person: Harsh Soni/ Payal Kulkarni/ Vishal Kanjani Contact Person: Ganesh Rane [email protected]
SEBI Registration No.: INM000011179 SEBI Registration No.: INM000008704 Contact Person: Mr. Sachin Achar
SEBI Registration No.: INR000004058
BID/ISSUE PROGRAMME*
* BID CLOSING DATE (FOR ALL OTHER
BID OPENING DATE (FOR ALL BIDDERS) : [] BID CLOSING DATE (FOR QIBs): []**
BIDDERS): []
*
Our Bank may, in consultation with the BRLMs, consider participation by Anchor Investors. The Anchor Investors shall Bid during the Anchor Investor Bidding Period, i.e., one Working Day prior to the Bid
Opening Date.
**
Our Bank may, in consultation with the BRLMs, decide to close Bidding by QIBs one day prior to the Bid Closing Date.
 TABLE OF CONTENTS

SECTION I – GENERAL ........................................................................................................................................... 1

DEFINITIONS AND ABBREVIATIONS ................................................................................................................ 1
CERTAIN CONVENTIONS, USE OF FINANCIAL INFORMATION AND MARKET DATA AND
CURRENCY OF PRESENTATION ....................................................................................................................... 10
FORWARD-LOOKING STATEMENTS ............................................................................................................... 12
SECTION II – RISK FACTORS ............................................................................................................................. 13
SECTION III – INTRODUCTION .......................................................................................................................... 52
SUMMARY OF INDUSTRY ................................................................................................................................. 52
SUMMARY OF BUSINESS ................................................................................................................................... 59
SUMMARY FINANCIAL INFORMATION ......................................................................................................... 66
THE ISSUE ............................................................................................................................................................. 71
GENERAL INFORMATION .................................................................................................................................. 72
CAPITAL STRUCTURE ........................................................................................................................................ 81
OBJECTS OF THE ISSUE ..................................................................................................................................... 96
BASIS FOR ISSUE PRICE ..................................................................................................................................... 99
STATEMENT OF TAX BENEFITS ..................................................................................................................... 102
SECTION IV – ABOUT THE BANK .................................................................................................................... 104
INDUSTRY OVERVIEW ..................................................................................................................................... 104
OUR BUSINESS ................................................................................................................................................... 127
REGULATIONS AND POLICIES ....................................................................................................................... 149
HISTORY AND CERTAIN CORPORATE MATTERS ...................................................................................... 165
OUR MANAGEMENT ......................................................................................................................................... 172
OUR PROMOTER AND PROMOTER GROUP ................................................................................................. 187
RELATED PARTY TRANSACTIONS ................................................................................................................ 188
DIVIDEND POLICY ............................................................................................................................................ 189
SECTION V – FINANCIAL INFORMATION .................................................................................................... 190
FINANCIAL STATEMENTS ............................................................................................................................... 190
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS OF OUR BANK ........................................................................................................................... 191
SELECTED STATISTICAL INFORMATION .................................................................................................... 221
FINANCIAL INDEBTEDNESS ........................................................................................................................... 248
SECTION VI – LEGAL AND OTHER INFORMATION .................................................................................. 251
OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS ........................................................... 251
GOVERNMENT AND OTHER APPROVALS ................................................................................................... 330
OTHER REGULATORY AND STATUTORY DISCLOSURES ........................................................................ 343
SECTION VII – ISSUE INFORMATION ............................................................................................................ 358
TERMS OF THE ISSUE ....................................................................................................................................... 358
ISSUE STRUCTURE ............................................................................................................................................ 362
ISSUE PROCEDURE ........................................................................................................................................... 367
SECTION VIII - MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION ........................................ 422
SECTION IX – OTHER INFORMATION ........................................................................................................... 460
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION .............................................................. 460
DECLARATION ................................................................................................................................................... 462
 SECTION I – GENERAL

DEFINITIONS AND ABBREVIATIONS

Unless the context otherwise indicates, requires or implies, the following terms shall have the meaning set forth
below in this Draft Red Herring Prospectus. References to statutes, rules, regulations, guidelines and policies will be
deemed to include all amendments and modifications notified thereto.

Bank Related Terms

Term Description
“Articles” or “Articles of The articles of association of our Bank, as amended.
Association” or “AoA”
Auditors The joint statutory central auditors of our Bank, being M/s. Sundaram & Srinivasan,
Chartered Accountants, and M/s. Varma & Varma, Chartered Accountants.
Audit Committee The audit committee of our Board of Directors.
“Board” or “Board of Directors” or The board of directors of our Bank, as duly constituted from time to time including any
“our Board” duly constituted committees thereof.
Director(s) Unless the context requires otherwise, the director(s) on our Board.
Equity Shares Equity shares of our Bank of face value of ` 10 each.
ESOS 2013 The CSB Employees Stock Option Scheme 2013, formulated by our Bank pursuant to
a shareholders resolution through postal ballot and e-voting, the results of which were
declared on August 18, 2014.
Independent Directors Independent directors on the Board, and eligible to be appointed as an independent
director under the provisions of the Companies Act, 2013 and the Listing Agreements.
For details of the Independent Directors, please refer to the section titled “Our
Management” on page 172.
Key Management Personnel The personnel listed as key management personnel in the section titled “Our
Management” on page 172.
Listing Agreements Listing agreements to be entered into by our Bank with the Stock Exchanges.
“Memorandum” or “Memorandum of The memorandum of association of our Bank, as amended.
Association” or “MoA”
“Our Bank” or “the Bank” or “the The Catholic Syrian Bank Limited, a company incorporated under the Indian
Issuer” Companies Act, 1913 and having the CIN U65191KL1920PLC000175.
Registered Office The registered office of our Bank, located at CSB Bhavan, Post Box 502, St. Mary’s
College Road, Thrissur 680 020, Kerala, India.
Shareholders Shareholders of our Bank.
“We” or “us” or “our” Our Bank.

Issue Related Terms

Term Description
“Allot” or “Allotment” or “Allotted” The allotment of Equity Shares pursuant to the Issue to successful Bidders.
Allotment Advice The advice or intimation of Allotment sent to the Bidders who are to be Allotted the
Equity Shares after the Basis of Allotment has been approved by the Designated Stock
Exchange, in accordance with the Book Building Process.
Allottee A successful Bidder to whom Allotment is made.
Anchor Investor(s) A Qualified Institutional Buyer, applying under the Anchor Investor Portion, who has
Bid for an amount of at least ` 100 million, in accordance with the requirements
specified in the SEBI Regulations.
Anchor Investor Allocation Notice The note or advice or intimation of allocation of the Equity Shares sent to the Anchor
Investors who have been allocated Equity Shares after discovery of the Anchor Investor
Allocation Price, including any revisions thereof.
Anchor Investor Allocation Price The price at which Equity Shares will be allocated in terms of the Red Herring
Prospectus and Prospectus to the Anchor Investors, which will be decided by our Bank
in consultation with the BRLMs on the Anchor Investor Bidding Date.
Anchor Investor Bidding Period The day, one Working Day prior to the Bid Opening Date, on which Bids by Anchor
Investors shall be submitted and allocation to Anchor Investors shall be completed.

1
 Term Description
Anchor Investor Issue Price The final price at which Allotment will be made to Anchor Investors in terms of the Red
Herring Prospectus and the Prospectus, which shall be higher than or equal to the Issue
Price, but not higher than the Cap Price. The Anchor Investor Issue Price will be
decided by our Bank in consultation with the BRLMs.
Anchor Investor Pay-in Date In case of the Anchor Investor Issue Price being higher than the Anchor Investor
Allocation Price, the date as mentioned in the Anchor Investor Allocation Notice but not
later than two Working Days after the Bid Closing Date.
Anchor Investor Portion The portion of the Net Issue available for allocation to Anchor Investors on a
discretionary basis out of which one-third shall be reserved for domestic Mutual Funds,
subject to valid Bids being at or above the Anchor Investor Allocation Price, in
accordance with the SEBI Regulations, being up to 60% of the QIB Portion or up to [●]
Equity Shares.
“ASBA” or “Application Supported The application (whether physical or electronic) used by an ASBA Bidder to make a Bid
by Blocked Amount” authorizing the SCSB to block the Bid Amount in the specified bank account maintained
with such SCSB.
ASBA is mandatory for QIBs (except Anchor Investors) and Non-Institutional Bidders
participating in the Issue. Anchor Investors are not permitted to participate through the
ASBA process.
ASBA Account Account maintained with an SCSB which will be blocked by such SCSB to the extent of
the Bid Amount of an ASBA Bidder as per the Bid cum Application Form submitted by
the ASBA Bidder.
ASBA Bidder Any Bidder, other than Anchor Investors, in this Issue who Bids through ASBA.
Basis of Allotment The basis on which the Equity Shares will be Allotted to successful Bidders, as
described in the section titled “Issue Procedure – Allotment Procedure and Basis of
Allotment” on page 411.
Bid(s) An indication by a Bidder to make an offer during the Anchor Investor Bidding Period
or Bidding Period, pursuant to submission of the Bid cum Application Form to subscribe
for Equity Shares, at a price within the Price Band, including all revisions and
modifications thereto, in terms of the Red Herring Prospectus and the Bid cum
Application Form.
Bidder A prospective investor who makes a Bid pursuant to the terms of the Red Herring
Prospectus and the Bid cum Application Form, and unless otherwise stated or implied,
includes an ASBA Bidder and Anchor Investor.
Bidding The process of making a Bid.
Bid Amount The highest value of optimal Bids indicated in the Bid cum Application Form and in the
case of Retail Individual Bidders Bidding at Cut-Off Price, the Cap Price multiplied by
the number of Equity Shares Bid for by such Retail Individual Bidder and mentioned in
the Bid cum Application Form.
Bid cum Application Form The form, which is serially numbered comprising an eight digit application number, in
terms of which a Bidder (including ASBA Bidder) makes a Bid in terms of the Red
Herring Prospectus which will be considered as an application for Allotment.
Bid Closing Date Except in relation to Anchor Investors, the date after which the Syndicate, the
Registered Brokers and the SCSBs will not accept any Bids, and which shall be notified
in an English national newspaper, a Hindi national daily newspaper and a Malayalam
newspaper, each with wide circulation and in case of any revision, the extended Bid
Closing Date also to be notified on the website and terminals of the Syndicate and
SCSBs, as required under the SEBI Regulations. Further, our Bank, in consultation with
the BRLMs, may decide to close Bidding by QIBs one day prior to the Bid Closing Date
which shall also be notified in an advertisement in same newspapers in which the Bid
Opening Date was published.
Bid Opening Date Except in relation to Anchor Investors, the date on which the Syndicate, the Registered
Brokers and the SCSBs shall start accepting Bids, and which shall be the date notified in
an English national newspaper, a Hindi national daily newspaper and a Malayalam
newspaper, each with wide circulation and in case of any revision, the extended Bid
Opening Date also to be notified on the website and terminals of the Syndicate and
SCSBs, as required under the SEBI Regulations.
Bidding Period The period between the Bid Opening Date and the Bid Closing Date or the QIB Bid
Closing Date, as the case may be (in either case inclusive of such date and the Bid
Opening Date) during which Bidders (including ASBA Bidders), other than Anchor
Investors, can submit their Bids, including any revisions thereof. Provided however that

2
 Term Description
the Bidding shall be kept open for a minimum of three Working Days for all categories
of Bidders, other than Anchor Investors.

Our Bank may, in consultation with the BRLMs, decide to close the Bidding by QIBs
one day prior to the Bid Closing Date.
Bid Lot [●] Equity Shares.
Book Building Process The book building process as described in Part A of Schedule XI of the SEBI
Regulations.
“Book Running Lead Managers” or ICICI Securities Limited and Kotak Mahindra Capital Company Limited.
“BRLMs”
Cap Price The higher end of the Price Band, in this case being ` [●], and any revisions thereof,
above which the Issue Price will not be finalised and above which no Bids will be
accepted.
Category III Foreign Portfolio FPIs who are registered as “Category III foreign portfolio investors” under the SEBI FPI
Investor Regulations.
Controlling Branches Such branches of the SCSBs which coordinate with the Registrar to the Issue and the
Stock Exchanges, a list of which is available on
http://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/Recognised-Intermediaries, and at
such other websites as may be prescribed by SEBI from time to time.
Cut-Off Price Any price within the Price Band as determined by our Bank in consultation with the
BRLMs, at which only the Retail Individual Bidders and Eligible Employees, Bidding
under the Employee Reservation Portion, are entitled to Bid, for Equity Shares of an
amount not exceeding ` 200,000.

No other category of Bidders is entitled to Bid at the Cut-off Price.

Demographic Details The address, the bank account details, MICR code, and occupation of a Bidder.
Depository A depository registered with SEBI under the Depositories Act.
Depositories Act The Depositories Act, 1996.
“Depository Participant” or “DP” A depository participant registered with SEBI under the Depositories Act.
Designated Branches Such branches of the SCSBs with which an ASBA Bidder, not Bidding through
Syndicate/Sub Syndicate or through a Registered Broker, may submit the Bid cum
Application Forms, a list of which is available on
http://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/Recognised-Intermediaries, and at
such other websites as may be prescribed by SEBI from time to time.
Designated Date The date on which funds are transferred from the Escrow Accounts to the Public Issue
Account or the Refund Account, as appropriate, or the funds are transferred from the
ASBA Accounts to the Public Issue Account, in terms of the Red Herring Prospectus,
after the Prospectus is filed with the RoC, following which our Board of Directors shall
Allot Equity Shares to successful Bidders in the Issue.
“Designated Stock Exchange” or [●].
“DSE”
“Draft Red Herring Prospectus” or This draft red herring prospectus dated March 30, 2015 filed with SEBI, prepared and
“DRHP” issued by our Bank in accordance with the SEBI Regulations and the Companies Act,
2013 and the rules thereunder.
Eligible Employee A permanent and full-time employee of our Bank; or a Director of our Bank, whether
whole-time or part-time, as on the date of the Red Herring Prospectus, who is an Indian
national and is based, working and present in India as on the date of submission of the
Bid cum Application Form and who continues to be in such employment until
submission of the Bid cum Application Form, but excludes such persons who are not
eligible under applicable laws, rules, regulations and guidelines.
Eligible FPIs FPIs from such jurisdictions outside India where it is not unlawful to make an offer/
invitation under the Issue and in relation to whom the Red Herring Prospectus
constitutes an invitation to Bid on the basis of the terms thereof.
Eligible NRI An NRI from a jurisdiction outside India where it is not unlawful to make an offer or
invitation under this Issue and in relation to whom the Red Herring Prospectus
constitutes an invitation to Bid on the basis of the terms thereof.
Employee Reservation Portion [●] Equity Shares, available for allocation to Eligible Employees, aggregating up to `
100 million.
Escrow Account(s) Accounts opened for this Issue with Escrow Collection Banks and in whose favour
cheques or drafts are issued by Bidders (excluding ASBA Bidders) in respect of the Bid

3
 Term Description
Amount.
Escrow Agreement An agreement to be entered into among our Bank, the Registrar to the Issue, the Escrow
Collection Banks, the Refund Bank(s), BRLMs and the Syndicate Members for the
collection of Bid Amounts and for remitting refunds, if any, to the Bidders (excluding
the ASBA Bidders) on the terms and conditions thereof.
Escrow Collection Banks/Bankers to The banks which are clearing members and registered with SEBI under the Securities
the Issue and Exchange Board of India (Bankers to an Issue) Regulations, 1994, in this case being
[●].
First Bidder The Bidder whose name appears first in the Bid cum Application Form or Revision
Form.
Floor Price The lower end of the Price Band, at or above which the Issue Price will be finalized and
below which no Bids will be accepted, in this case being ` [●], and any revisions
thereof.
Issue Initial public issue of [●] Equity Shares aggregating up to ` 4,000 million by our Bank.
Issue Agreement The issue agreement entered into on March 30, 2015 among our Bank and the BRLMs.
Issue Price The price at which Allotment will be made, as determined by our Bank in consultation
with the BRLMs.

Unless otherwise stated or the context otherwise implies, the term Issue Price refers to
the Issue Price applicable to investors other than Anchor Investors.
Issue Proceeds The proceeds of this Issue based on the total number of Equity Shares Allotted under
this Issue at the Issue Price.
Mutual Funds Mutual funds registered with SEBI under the Securities and Exchange Board of India
(Mutual Funds) Regulations, 1996.
Mutual Fund Portion 5% of the Net QIB Portion constituting [●] Equity Shares, available for allocation to
Mutual Funds, on a proportionate basis, subject to valid Bids being received at or above
the Issue Price.
Net Issue The Issue less the Employee Reservation Portion.
Net Proceeds The Issue Proceeds less the Issue expenses.
Net QIB Portion The QIB Portion less the number of Equity Shares Allotted to the Anchor Investors.
“Non-Institutional Bidders” or All Bidders (including Sub-Accounts which are foreign corporate or foreign individuals)
“NIIs” who are not Qualified Institutional Buyers, Retail Individual Bidders or Eligible
Employees and who have Bid for an amount more than ` 200,000 (but not including
NRIs other than Eligible NRIs).
Non-Institutional Portion The portion of the Issue being not less than 15% of the Net Issue consisting of [●]
Equity Shares, available for allocation to Non-Institutional Bidders, on a proportionate
basis, subject to valid Bids being received at or above the Issue Price.
Pre-IPO Placement The private placement of up to 12,500,000 Equity Shares for cash consideration
aggregating up to ` 1,500 million by our Bank at its discretion in favour of such
investors as permissible under applicable laws, to be completed prior to filing the Red
Herring Prospectus with the RoC and the details of which, if completed, will be included
in the Red Herring Prospectus. If the Pre-IPO Placement is completed, the number of
Equity Shares issued pursuant to the Pre-IPO Placement will be reduced from the Issue,
subject to a minimum Net Issue size of 25% of the post Issue paid-up equity share
capital being offered to the public.
Price Band The price band of the Floor Price and Cap Price, including any revisions thereof decided
by our Bank in consultation with the BRLMs, and advertised in an English national
newspaper, a Hindi national newspaper and a Malayalam newspaper, each with wide
circulation, at least five Working Days prior to the Bid Opening Date.
Pricing Date The date on which the Issue Price is decided by our Bank in consultation with the
BRLMs.
Prospectus The prospectus to be filed with the RoC for this Issue after the Pricing Date, in
accordance with Section 26 of the Companies Act, 2013 and the SEBI Regulations
containing, inter-alia, the Issue Price, size of the Issue and certain other information.
Public Issue Account A bank account opened with the Bankers to the Issue by our Bank under Section 40 of
the Companies Act, 2013 to receive money from the Escrow Accounts on the
Designated Date and where the funds shall be transferred by the SCSBs from the ASBA
Accounts.
“QIBs” or “Qualified Institutional Qualified institutional buyers, as defined under Regulation 2(1)(zd) of the SEBI
Buyers” Regulations.

4
 Term Description
QIB Bid Closing Date In the event our Bank, in consultation with the BRLMs, decides to close Bidding by
QIBs one day prior to the Bid Closing Date, the date one day prior to the Bid Closing
Date; otherwise it shall be the same as the Bid Closing Date.
QIB Portion The portion of the Issue being 50% of the Net Issue or up to [●] Equity Shares available
for allocation to QIBs (including the Anchor Investor) on a proportionate basis.
“Red Herring Prospectus” or “RHP” The red herring prospectus to be issued by our Bank in accordance with Section 32 of the
Companies Act, 2013 and the SEBI Regulations which does not have complete
particulars of the price at which the Equity Shares are offered and the size of the Issue.
Refund Account(s) The account(s) opened by our Bank with the Refund Bank(s), from which refunds of the
whole or part of the Bid Amounts (excluding for the ASBA Bidders), if any, shall be
made.
Refunds through electronic transfer Refunds through NECS, NEFT, direct credit or RTGS, as applicable.
of funds
Refund Banker(s) The Banker(s) to the Issue, with whom the Refund Account(s) will be opened, in this
case being [●].
Registered Broker A broker registered with SEBI under the Securities and Exchange Board of India (Stock
Brokers and Sub Brokers Regulations), 1992, having terminals in any of the Non
Syndicate Broker Centres, and eligible to procure Bids in terms of the circular No.
CIR/CFD/14/2012 dated October 4, 2012 issued by SEBI.
Registered Broker Centre A broker centre of the stock exchanges with broker terminals, wherein a Registered
Broker may accept Bid cum Application Forms, details of which are available on the
website of the Stock Exchanges, and at such other websites as may be prescribed by
SEBI from time to time.
“Registrar” or “Registrar to the Link Intime India Private Limited.
Issue”
Retail Individual Bidders Bidders (including HUFs and Eligible NRIs), who have Bid for an amount less than or
equal to ` 200,000.
Retail Portion The portion of the Issue being not less than 35% of the Net Issue, consisting of [●]
Equity Shares, available for allocation to Retail Individual Bidders, as per the SEBI
Regulations
Revision Form The form used by the Bidders, to modify the quantity of Equity Shares or the Bid
Amount in any of their Bid cum Application Forms or any previous revision form(s), as
applicable.
“Self Certified Syndicate Banks” or The banks which are registered with SEBI under the Securities and Exchange Board of
“SCSBs” India (Bankers to an Issue) Regulations, 1994 and offer services in relation to ASBA,
including blocking of an ASBA Account in accordance with the SEBI Regulations and a
list of which is available on
http://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/Recognised-Intermediaries, or at
such other website as may be prescribed by SEBI from time to time.
Stock Exchanges The BSE and the NSE.
Sub Syndicate The sub-syndicate members, if any, appointed by the BRLMs and the Syndicate
Members, to collect Bid cum Application Forms and Revision Forms.
Syndicate Agreement The agreement to be entered into amongst the Syndicate and our Bank in relation to
collection of Bids in this Issue (excluding Bids from ASBA Bidders procured directly
by SCSBs and Bids procured by Registered Brokers).
Syndicate Bidding Centres Syndicate and Sub Syndicate centres established for acceptance of the Bid cum
Application Forms and Revision Forms.
Syndicate Members Intermediaries registered with the SEBI who are permitted to carry out activities as an
underwriter, in this case being [●].
Syndicate /members of the Syndicate The BRLMs and the Syndicate Members.
“Transaction Registration Slip” or The slip or document issued by a Syndicate/Sub Syndicate, Registered Broker or an
“TRS” SCSB (only on demand), as the case may be, to the Bidder as proof of uploading of a
Bid.
Underwriters The BRLMs and the Syndicate Members.
Underwriting Agreement The agreement to be entered into between the Underwriters, our Bank and the Registrar
to the Issue on or immediately after the Pricing Date.
Working Days All days on which commercial banks in Mumbai are open for business except Saturday,
Sunday and any bank holiday, provided however between the Bidding Period and the
listing of Equity Shares on the Stock Exchanges, a Working Day means all days on
which banks in Mumbai are open for business and shall not include a Sunday or a bank

5
 Term Description
holiday in Delhi or Mumbai, in accordance with the SEBI circular no.
CIR/CFD/DIL/3/2010 dated April 22, 2010.

Conventional/General Terms, Abbreviations and Reference to Other Business Entities

Abbreviation Full Form

ACIT Assistant Commissioner of Income Tax.
AI Anchor Investor.
AIFs Alternative investment funds registered under the Securities and Exchange Board of
India (Alternative Investment Funds) Regulations, 2012.
ALCO Assets and liabilities management committee.
AGM Annual general meeting.
AS Accounting standards as issued by the Institute of Chartered Accountants of India.
A.Y. Assessment year.
Banking Ombudsman Qausi-judicial authority constituted under the Banking Ombudsman Scheme, 2006 for
the resolution of complaints in relation to the services of banks.
Banking Regulation Act The Banking Regulation Act, 1949.
BSBDA Basic savings bank deposit account.
BSE BSE Limited.
CAGR Compounded annual growth rate.
CDSL Central Depository Services (India) Limited.
CEO Chief executive officer.
CIN Corporate identity number.
CIT Commissioner of Income Tax.
Companies Act, 2013 Companies Act, 2013, to the extent notified.
DCIT Deputy Commissioner of Income Tax.
DIN Director identification number.
DP Depository participant.
DP ID Depository participant’s identification.
EBIDTA Earnings before interest, tax, depreciation and amortization.
ECS Electronic clearing system.
EGM Extraordinary general meeting.
EPS Earnings per share.
ESOS Regulations Securities and Exchange Board of India (Share Based Employee Benefits) Regulations,
2014.
FCNR Account Foreign Currency Non-Resident Account.
FDI Foreign direct investment, as laid down in the Consolidated FDI Policy dated April 17,
2014.
FEMA Foreign Exchange Management Act, 1999, together with rules and regulations framed
thereunder.
FEMA Regulations Foreign Exchange Management (Transfer or Issue of Security by a Person Resident
Outside India) Regulations, 2000.
FII Foreign Institutional Investors holding a valid certificate of registration under the
Securities and Exchange Board of India (Foreign Institutional Investors) Regulations,
1995, as repealed, and who are deemed to be Foreign Portfolio Investors.
FII Regulations Securities and Exchange Board of India (Foreign Institutional Investors) Regulations,
1995.
FPI Foreign Portfolio Investor (as defined in Section 2(h) of SEBI (Foreign Portfolio
Investors) Regulations, 2014) and registered with SEBI.
FIPB Foreign Investment Promotion Board.
“Fiscal” or “Financial Year” or Period of twelve months ended March 31 of that particular year, unless otherwise
“Fiscal Year” stated.
FIU Financial Intelligence Unit – India, a central national agency responsible for receiving,
processing, analyzing and disseminating information relating to suspect financial
transactions.
FPI Regulations Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations,
2014.
FVCI Foreign venture capital investors (as defined under the SEBI (Foreign Venture Capital
Investors) Regulations, 2000) registered with SEBI.

6
 Abbreviation Full Form
FVCI Regulations Securities and Exchange Board of India (Foreign Venture Capital Investors)
Regulations, 2000.
GAAP Generally accepted accounting principles.
GDP Gross domestic product.
GIR Number General Index Register Number.
“GoI” or “Government of India” or The Government of India.
“Central Government”
HNI High net worth individual.
HUF Hindu undivided family.
IEC Importer exporter code.
IFRS International Financial Reporting Standards.
Indian GAAP Generally accepted accounting principles in India.
Industrial Disputes Act Industrial Disputes Act, 1947.
IPO Initial public offer.
IRDA Insurance Regulatory and Development Authority.
I-Sec ICICI Securities Limited
IT Information Technology.
“IT Act” or “Income Tax Act” Income Tax Act, 1961.
Income Tax Rules Income Tax Rules, 1962.
ITAT Income Tax Appellate Tribunal.
IT Department Income Tax Department, GoI.
Kotak Kotak Mahindra Capital Company Limited.
MAT Minimum alternate tax.
MCA Ministry of Corporate Affairs, GoI.
MICR Magnetic Ink Character Recognition.
NAV Net Asset Value.
NECS National Electronic Clearing System.
NEFT National Electronic Funds Transfer.
Negotiable Instruments Act The Negotiable Instruments Act, 1881.
NIF National Investment Fund set up by resolution No. F. No. 2/3/2005-DDII dated
November 23, 2005 of the Government of India.
NRE Account Non-Resident External Account.
NRI A person resident outside India, as defined under FEMA and who is a citizen of India or
a person of Indian origin, such term as defined under the Foreign Exchange
Management (Deposit) Regulations, 2000.
NRO Account Non-Resident Ordinary Account.
“NR” or “Non Resident” A person resident outside India, as defined under FEMA, including an Eligible NRI,
FII, FPI or FVCI.
NSDL National Securities Depository Limited.
NSE National Stock Exchange of India Limited.
OCBs A company, partnership, society or other corporate body owned directly or indirectly to
the extent of at least 60% by NRIs including overseas trusts, in which not less than 60%
of beneficial interest is irrevocably held by NRIs directly or indirectly and which was in
existence on October 3, 2003 and immediately before such date was eligible to
undertake transactions pursuant to the general permission granted to OCBs under
FEMA.
p.a. Per annum.
PAN Permanent account number allotted under the IT Act.
Partnership Act The Partnership Act, 1932.
PAT Profit after tax.
PBT Profit before tax.
P/E Ratio Price/earnings ratio.
PLR Prime lending rate.
RBI Reserve Bank of India.
“RoC” or “Registrar of Companies” Registrar of Companies, Kerala at Ernakulum.
“`” or “Rupees” or “Rs.” Indian Rupees.
RTGS Real Time Gross Settlement.
SARFAESI Act The Securitization and Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002.

7
 Abbreviation Full Form
SCRA Securities Contracts (Regulation) Act, 1956.
SCRR Securities Contracts (Regulation) Rules, 1957.
SEBI The Securities and Exchange Board of India established under the SEBI Act
SEBI Act The Securities and Exchange Board of India Act, 1992.
SEBI Regulations The Securities and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009.
SEBI (Foreign Portfolio Investor) Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014.
Regulations
Securities Act (U.S.) Securities Act of 1933.
Sq. Ft. Square foot.
Sq. Mt. Square metre.
State government The government of a state of Republic of India.
Sub-Account Sub-accounts registered with SEBI under the Securities and Exchange Board of India
(Foreign Institutional Investor) Regulations, 1995, as repealed, and who can continue to
buy, sell or otherwise deal in securities under the SEBI (Foreign Portfolio Investor)
Regulations, 2014.
Takeover Code Securities and Exchange Board of India (Substantial Acquisition of Shares and
Takeovers) Regulations, 2011.
TAN Tax deduction account number allotted under the IT Act.
TDS Tax deducted at source.
TIN Taxpayer identification number.
“U.S.” or “US” or “U.S.A” or The United States of America, together with its territories and possessions.
“United States”
U.S. GAAP Generally accepted accounting principles in the United States of America.
VCFs Venture Capital Funds as defined and registered with SEBI under the Securities and
Exchange Board of India (Venture Capital Fund) Regulations, 1996.

Industry/Project Related Terms, Definitions and Abbreviations

Abbreviation Full Form

AML Anti money laundering
ANBC Adjusted Net Bank Credit
ATM Automated teller machine
ARC Asset reconstruction companies
CAP Corrective Action Plan
CASA Current Account Savings Account
CBLO Collateralised borrowing and lending obligations
CCIL Clearing Corporation of India Limited
CDR Corporate debt restructuring
CET Common Tier Equity
CFP Contingency funding plan
CPI Consumer Price Index
CRAR Capital to Risk Weighted Assets Ratio
CRILC Central Repository of Information on Large Credits
CRR Cash reserve ratio
DICGC Depositors Insurance Credit Guarantee Corporation
FI Financial institution
FLCC Financial Literacy and Credit Counselling Centre
IBA Indian Banks’ Association
IBL Inter bank liability
JLF Joint lenders’ forum
KYC Know your customer
LAB Local area bank
LAP Loan against property
LC Letter of credit
LCR Liquidity coverage ratio
MSME Micro, Small and Medium Enterprises
NABARD National Bank for Agriculture and Rural Development

8
 Abbreviation Full Form
NDTL Net demand time liabilities
NHB National Housing Bank
NIM Net interest margin
NPA Non performing assets
NSFR Net stable funding ratio
OTS One time settlement
PMJDY Pradhan Mantri Jan Dhan Yojna
PTC Pass through certificates
PSU Public Sector Undertaking
RC Reconstruction Company
RIDF Rural Infrastructure Development Fund
RRB Regional Rural Bank
SC Securitization Company
SLR Statutory liquidity ratio
SMA Special mention accounts
SME Small and medium enterprises
STT Securities transaction tax
NBFC Non Banking Financial Corporation
WPI Wholesale Price Index

The words and expressions used in this Draft Red Herring Prospectus but not defined herein shall have the same
meaning as is assigned to such words and expressions under the SEBI Regulations, the Companies Act, 1956, the
Companies Act, 2013, the SCRA, the Depositories Act and the rules and regulations made thereunder.

Notwithstanding the foregoing, terms in the sections titled, “Statement of Tax Benefits”, “Financial Statements” and
“Main Provisions of the Articles of Association”, “Issue Procedure - Part B - General Information” beginning at
pages 102, 190, 422 and 383, respectively, have the meanings given to such terms in these respective sections.

9
 CERTAIN CONVENTIONS, USE OF FINANCIAL INFORMATION AND MARKET DATA AND
CURRENCY OF PRESENTATION

Currency of Presentation

All references to “Rupees”, “Rs.” “INR” or “`” are to Indian Rupees, the official currency of the Republic of India.
All references to “USD”, “US Dollar” or “US$” are to the United States Dollar, the official currency of the United
States of America. All references to “GBP” or “£” are to Pound Sterling, the official currency of United Kingdom.
All references to “EURO” or “EUR.” are to the Euro, the official currency of the European Union. All references to
“Japanese Yen” or “JPY” are to the Japanese Yen, the official currency of Japan. All references to “CAD” are to the
Canadian Dollar, the official currency of Canada. All references to “AUD” are to Australian Dollars, the official
currency of Commonwealth of Australia. All references to “CHF” are to the Swiss Franc, the official currency of
Switzerland.

Exchange Rates

The following table sets forth, for each period indicated, information concerning the number of Rupees for which
one U.S. Dollar could be exchanged. The row titled ‘average’ in the table below is the average of the daily rate for
each day in the period.

Period Period end (in `.) Period average (in `.)

Six months ended September 30, 2014 60.61 60.19
Fiscal 2014 60.10 60.50
Fiscal 2013 54.39 54.45
Fiscal 2012 51.16 47.95
Fiscal 2011 44.65 45.58
Fiscal 2010 45.14 47.42
Source: ww.rbi.org.in

Such translations should not be considered as a representation that such U.S. Dollar amounts have been, could have
been or could be converted into Rupees at any particular rate, the rates stated above or at all.

Financial Data

Unless stated otherwise, the financial information in this Draft Red Herring Prospectus is derived from our restated
audited financial statements as on and for the Fiscal Years ended March 31, 2010, 2011, 2012, 2013 and 2014 and
the six months ended September 30, 2014, and the related notes, schedules and annexures thereto included in this
Draft Red Herring Prospectus, which have been prepared in accordance with the Companies Act, 2013, the
guidelines issued by the Reserve Bank of India from time to time, the Accounting Standards (AS) issued by the
Institute of Chartered Accountants of India referred to in the Companies Act, 1956 read with the General Circular
15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies
Act, 2013 and Indian GAAP and restated in accordance with the SEBI Regulations.

Our Bank’s fiscal year ends on March 31 of each year. Accordingly, all references to a particular fiscal year are to
the 12 month period ended March 31 of that year, unless otherwise specified.

All the numbers in this document have been presented in million or in whole numbers where the numbers have been
too small to present in million, unless stated otherwise.

We prepare our audited financial statements in accordance with Indian GAAP and guidelines issued by the RBI,
which differs in some respects from IFRS and U.S. GAAP. Accordingly, the degree to which the Indian GAAP
financial statements included in this Draft Red Herring Prospectus will provide meaningful information is entirely
dependent on the reader’s level of familiarity with the Companies Act, 2013, Indian GAAP, RBI guidelines and the
SEBI Regulations. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures
presented in this Draft Red Herring Prospectus should accordingly be limited. We have not attempted to quantify the

10
impact of IFRS or U.S. GAAP on the financial data included in this Draft Red Herring Prospectus, nor do we
provide a reconciliation of our financial statements to those under U.S. GAAP or IFRS and we urge you to consult
your own advisors regarding such differences and their impact on our financial data.

Certain figures contained in this Draft Red Herring Prospectus, including financial information, have been subject to
rounding adjustments. All decimals have been rounded off to two decimal points. In certain instances, (i) the sum or
percentage change of such numbers may not conform exactly to the total figure given; and (ii) the sum of the
numbers in a column or row in certain tables may not conform exactly to the total figure given for that column or
row. However, where any figures that may have been sourced from third-party industry sources are rounded off to
other than two decimal points in their respective sources, such figures appear in this Draft Red Herring Prospectus as
rounded-off to such number of decimal points as provided in such respective sources.

Market and Industry Data

Unless stated otherwise, industry and market data used in this Draft Red Herring Prospectus have been obtained or
derived from publicly available information, including primarily, policy statements, reports and analysis by the RBI.
Industry publications generally state that the information contained in those publications has been obtained from
sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability
cannot be assured. Accordingly, no investment decision should be made on the basis of such information. Although
we believe that industry data used in this Draft Red Herring Prospectus is reliable, it has not been independently
verified by us or the BRLMs or any their affiliates or advisors. The data used in these sources may have been
reclassified by us for the purposes of presentation. Data from these sources may also not be comparable. The extent
to which the market and industry data used in this Draft Red Herring Prospectus is meaningful depends on the
reader’s familiarity with and understanding of the methodologies used in compiling such data. There are no standard
data gathering methodologies in the industry in which we conduct our business, and methodologies and assumptions
may vary widely among different industry sources.

Such data involves risks, uncertainties and numerous assumptions and is subject to change based on various factors,
including those discussed in the section titled “Risk Factors” on page 13. Accordingly, investment decisions should
not be based solely on such information.

Certain Conventions

All references in this Draft Red Herring Prospectus to India are to the Republic of India. All references in this Draft
Red Herring Prospectus to the USA, U.S. or United States are to the United States of America.

11
 FORWARD-LOOKING STATEMENTS

This Draft Red Herring Prospectus contains certain “forward looking statements”. These forward looking statements
can generally be identified by words or phrases such as “will”, “aim”, “will likely result”, “believe”, “expect”, “will
continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”, “goal”,
“project”, “should”, “propose”, “will pursue” and similar expressions or variations of such expressions. Similarly,
statements that describe our objectives, strategies, plans or goals are also forward looking statements. All forward
looking statements based on our current plans, estimates and expectations are subject to risks, uncertainties and
assumptions about us that could cause our actual results to differ materially from those contemplated by the relevant
forward looking statement.

Actual results may differ materially from those suggested by the forward-looking statements due to risks or
uncertainties. Important factors that could cause actual results to differ materially from our Bank’s expectations
include, but are not limited to, the following:

 ability to effectively manage the level of our NPAs;

 adverse change in the economic condition of Kerala and other states in which we have major presence;
 ability to successfully expand our operations to other parts of India;
 adverse performance by ‘priority sectors’ or any change in the RBI’s regulations relating to priority sector
lending or our inability to meet the priority sector lending targets;
 volatility in the market price of gold;
 ability to successfully execute our business and growth strategies and manage our growth;
 ability to maintain or grow our CASA ratio in accordance with our strategy;
 competition in the Indian banking industry;
 general economic and business conditions in India;
 ability to sustain the growth of our SME and retail banking business;
 sustained difficulties experienced by certain industry sectors in which our exposure is concentrated;
 volatility in interest rates; and
 ability to comply with minimum capital adequacy requirements.

For a further discussion of factors that could cause our actual results to differ, see the sections titled “Risk Factors”,
“Our Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”
beginning at pages 13, 127, and 191, respectively. By their nature, certain market risk disclosures are only estimates
and could be materially different from what actually occurs in the future. As a result, actual future gains or losses
could materially differ from those that have been estimated and are not a guarantee of future performance. Although
we believe that the assumptions on which such statements are based are reasonable, any such assumptions as well as
statements based on them could prove to be inaccurate.

Forward-looking statements speak only as on the date of this Draft Red Herring Prospectus and are not a guarantee
of future performance. None of our Bank, our Directors, our officers, the BRLMs or any of their respective affiliates
or associates have any obligation to update or otherwise revise any statement reflecting circumstances arising after
the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to
fruition. Our Bank and the BRLMs will ensure that investors in India are informed of material developments until
the commencement of listing and trading. Further, in accordance with Regulation 51A of the SEBI Regulations, our
Bank may be required to undertake an annual updation of the disclosures made in this Draft Red Herring Prospectus
and make it publicly accessible in the manner specified by SEBI.

12
 SECTION II – RISK FACTORS

An investment in Equity Shares involves a high degree of risk. You should carefully consider all the information in
this Draft Red Herring Prospectus, including the risks and uncertainties described below, before making an
investment in the Equity Shares. If any, or some combination, of the following risks actually occur, our business,
prospects, results of operations and financial condition could materially suffer, the trading price of the Equity
Shares could decline and you may lose all, or part, of your investment.

We have described the risks and uncertainties that we believe are material, but these risks and uncertainties may not
be the only ones we face. Additional risks and uncertainties, including those we are not aware of or deem
immaterial, may also result in decreased revenue, increased expenses or other events that could result in a decline
in the value of the Equity Shares. In making an investment decision, prospective investors must rely on their own
examination of us and the Issue, including the merits and risks involved. Investors should consult their own counsel
and advisors as to business, investment, legal, tax, accounting and related matters concerning this Issue.

This Draft Red Herring Prospectus also contains forward-looking statements that involve risks and uncertainties.
Our results could differ materially from such forward-looking statements as a result of certain factors, including the
considerations described below and elsewhere in this Draft Red Herring Prospectus. Unless specified or quantified
in the relevant risk factors below, we are not in a position to quantify the financial or other implications of any of
the risks described in this section. Unless otherwise stated, our financial information used in this section is derived
from our audited restated financial statements.

INTERNAL RISK FACTORS

1. Our business and financial performance could suffer if we are unable to effectively manage the level of our
NPAs. Any change in the income recognition, asset classification norms or in RBI mandated provisioning
requirements could also affect our business.

The total value of our net NPAs increased from ` 992.59 million as on March 31, 2013, to ` 1,932.41 million as
on March 31, 2014, which represented 2.22 % of our net advances as on March 31, 2014. As on September 30,
2014, the total value of our net NPAs was ` 3,543.12 million, which represented 3.76% of our net advances. For
the Fiscal 2012, 2013 and 2014, our gross NPAs were ` 1,829.26 million, ` 2,108.69 million and ` 3,335.54
million, respectively. Our gross NPAs represented 3.77% of our total advances as on March 31, 2014. As on
September 30, 2014, the total value of our gross NPAs was ` 5,345.77 million, which represented 5.56% of our
total advances as on September 30, 2014. Our net NPAs and gross NPAs as on September 30, 2014 had an
increasing trend. Although our Bank is making efforts to improve collections and to foreclose on existing
impaired loans in a timely manner, there cannot be any assurance that we will be successful in our efforts or that
the overall quality of our Bank’s loan portfolio will improve or will not deteriorate in the future. If our Bank is
unsuccessful in controlling or reducing its impaired loans, if there is a significant increase in impaired loans, or
if there is deterioration in the quality of the assets that our Bank holds as security, our Bank’s future financial
performance could be materially and adversely affected.

While we have a provisioning coverage ratio of 49.28% and 39.11% for March 31, 2014 and September 30,
2014 respectively, we may need to make further provisions if recoveries with respect to such NPAs do not
materialize in time or at all, or if NPA classification or provision requirements change. As on March 24, 2015,
311 notices have been issued by our Bank under the Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (the “SARFAESI Act”) against defaulting borrowers, involving an
aggregate amount, to the extent quantifiable, of ` 3,224.68 million. There are 43 such notices, which involve an
amount equal to or above ` 10 million. Further to notices issued under the SARFAESI Act, our Bank has
initiated 26 civil proceedings for the possession of the properties and other assets constituting the security
furnished with respect to the outstanding borrowings, involving an aggregate amount, to the extent quantifiable,
of approximately ` 118.31 million. There are three such proceedings, which involve an amount equal to or
above ` 10 million. Additionally, the relevant borrowers may also initiate legal proceedings challenging the
notice issued for recovery of outstanding borrowings. Currently there are 47 such proceedings, involving an
aggregate amount, to the extent quantifiable, of approximately ` 655.51 million, out of which the potential

13
 financial implication of nine such proceedings is estimated to be ` 10 million or higher. There can be no
assurance that the defaulting borrowers would repay the outstanding borrowings pursuant to the notices, or that
we would succeed in these suits. As on September 30, 2014, we have made provisions to the tune of ` 1,776.31
million in relation to these defaulting loans. Any significant increase in write-offs and/or provisions would
materially and adversely impact our Bank’s financial performance.

There can be no assurance that we will be able to contain or reduce NPAs or that the overall quality of our loan
portfolio will improve or will not deteriorate in the future. Any increase in NPAs will reduce the net interest-
earning asset base and increase provisioning requirements, thereby adversely affecting our financial condition
and results of operations. Various factors beyond our control, such as rise in unemployment, prolonged
recessionary conditions in the world economy, a sharp and sustained rise in the interest rates, developments in
the Indian economy, movements in global commodity markets and exchange rates, increased global competition
and adverse changes in Indian laws, regulations and policies could have an adverse impact on the quality of our
loan portfolio. The inability of borrowers to repay loans may translate into mounting NPAs. Stress in certain
sectors of the economy could impact our customers and result in higher levels of NPAs and restructured assets
in the future.

Further, certain assets classified as restructured may subsequently be classified as delinquent or non-performing
in case a borrower fails to restore its financial viability and honor its loan servicing obligations. There can be no
assurance that the debt restructuring criteria approved by us will be adequate or successful and that borrowers
will be able to meet their obligations under restructured advances. Any resulting increase in delinquency levels
may adversely impact our business, financial condition and results of operations.

For certain categories of advances, though banks are currently permitted to continue the standard asset
classification status on successful implementation of restructuring packages, such regulatory dispensation would
not be available from April 1, 2015, post which a standard account on restructuring (for reasons other than
change in DCCO) would be immediately classified as sub-standard on restructuring. Due to this change in
regulation we will not be able to retain standard asset classification through restructuring and this may
potentially increase our NPAs. Further, for assets sold on or after February 26, 2014 and up to March 31, 2015
to Securitization Company (SC)/Reconstruction Company (RC), as an incentive for early sale of NPAs, banks
can spread over any shortfall, if the sale value is lower than the NBV, over a period of two years. During the six
months ended September 30, 2014, we have sold assets of net book value ` 1,595.30 million and the loss on
sale is being spread over two years. Thus, such a facility will not be available for assets sold after March 31,
2015.

The combination of changes in regulations regarding restructured loans, provisioning, and any substantial
increase in the level of restructured assets and the failure of these structured loans to perform as expected, could
materially adversely affect our business and future financial performance.

2. We have regional concentration in southern India, especially Kerala. Any adverse change in the economic
condition of Kerala and other states in southern India can impact our results of operations. Additionally, we
may not be successful in expanding our operations to other parts of India which could have an adverse effect
on our business, financial condition and results of operations.

As on September 30, 2014, out of our 426 branches (excluding our five service branches), 363 branches were
located in southern India (including 280 branches which were located in Kerala and 57 branches in Tamil Nadu)
constituting 85% of our total branch network. As on September 30, 2014, out of total deposit of ` 141,655.02
million, ` 87,306.33 million and ` 19,306.98 million were received from Kerala and Tamil Nadu, respectively,
constituting 61.63% and 13.63%, respectively. As on September 30, 2014, out of total advances of ` 96,087.65
million, ` 37,748.29 million and ` 32,997.88 million were in Kerala and Tamil Nadu, respectively, constituting
39.29% and 34.34%, respectively.

As of September 30, 2014, we have 363, 39, 15, five and four branches which are located in southern, western,
northern, central and eastern regions in India, respectively. Additionally, we also have five service branches.

Our concentration in the southern India, and specifically in Kerala, exposes us to many adverse economic or

14
 political circumstances in the region as compared to other public and private sector banks that have a more
diversified national presence. Any political unrest, disruption, disturbance or sustained downturn in the
economy of Kerala and other states in southern India could adversely affect our business, financial condition
and results of operations.

Additionally, while we continue to expand our operations outside of our traditional areas of operation, namely
Kerala and other states in southern India, we face risks with respect to our operations in geographic areas in
which we do not possess the same level of familiarity with the economic condition, consumer base and
commercial operations. In addition, our competitors may already have established operations in areas outside
southern India and we may find it difficult to attract customers in such new areas. We may not be able to
successfully manage the risks of such an expansion, which could have a material adverse effect on our business,
financial condition and results of operations.

3. We are required to lend a minimum percentage of our adjusted net bank credit to certain ‘priority sectors’.
Any adverse performance by such ‘priority sectors’ or any change in the RBI’s regulations relating to
priority sector lending or our Bank’s inability to meet the priority sector lending targets could have a
material adverse impact on our financial condition and results of operations.

In accordance with current RBI guidelines, all banks in India, including us, are subject to directed lending
regulations. We are required to lend a minimum of 40% of our adjusted net bank credit to ‘priority sectors’. Our
priority sectors advances include direct and indirect advance for agriculture, loans to micro and small
enterprises, housing loans and educational loans. Out of the advances we are required to lend under the ‘priority
sector’, at least 18% of our adjusted net bank credit must be lent to the agricultural sector and at least 10% of
adjusted net bank credit to weaker sections. Further, 1% of the adjusted net bank credit is required to be lent
under the ‘Differential Rate of Interest Scheme’.

As on March 31, 2012, 2013, 2014 and September 30, 2014, our lending to ‘priority sectors’ constituted 40.18%
(i.e., ` 25,320.60 million), 24.52% (i.e., ` 19,134.50 million), 31.70% (i.e., ` 29,031.50 million) and 38.38%
(i.e., ` 35,390.60 million), respectively, of our adjusted net bank credit, including 18.19% (i.e., ` 11,464.60
million), 6.38% (i.e., ` 4,978.70 million), 8.35% (i.e., ` 7,647.80 million) and 10.55% (i.e., ` 9,731.50 million),
respectively, to the agricultural sector.

Further, as on March 31, 2012, 2013, 2014 and September 30, 2014, of our total NPAs, 3.74% (i.e., ` 68.50
million), 2.69% (i.e., ` 56.70 million), 0.67% (i.e., ` 22.30 million) and 1.24% (i.e., ` 66.30 million),
respectively was towards agricultural sector (excluding RIDF) which constituted 14.76% (i.e., ` 11,464.60
million), 5.55% (i.e., ` 4,978.70 million), 4.84% (i.e., ` 4,283.20 million) and 6.74% (i.e., ` 6481.10 million),
respectively, of our total advances to the agricultural sector, for the said period.

We have experienced instances of shortfalls in our directed lending to priority sectors in the past. Any shortfall
in the amount required to be provided to the relevant sectors must be deposited with Government-sponsored
Indian development banks such as the NABARD and NHB. These deposits typically carry interest rates lower
than market rates adding pressure on net interest margin. Our investment in such deposits as on September 30,
2014 was ` 3,937.50 million.

Further, non-achievement of lending targets to priority sectors may also be considered as a factor by RBI while
deciding to grant regulatory clearances and approvals for various purposes. We cannot assure you that we will
be able to meet the lending targets towards priority sectors. In case we are unable to meet such targets, we may
have to deposit the shortfall with any one of such agencies, resulting in reduced interest income on such
advances and refusal of RBI to grant us regulatory clearances and approvals in the future.

Any adverse performance by the priority sectors could significantly increase our NPAs, which may materially
and adversely affect our business, results of operations and financial condition. Further, any change in the RBI’s
guidelines may require us to increase our lending to the priority sector, which may result in an increase in
NPAs. While recovery camps are organized by our Bank with the assistance of government bodies to increase
the recovery of loans made under government sponsored schemes and other loans in priority sector to reduce
our NPAs, there can be no assurance that we would be successful in recovering the outstanding amounts from

15
 defaulting borrowers. As on March 24, 2015, there are 3,026 such recovery proceedings, and the aggregate
amount involved, to the extent quantifiable, in such proceedings is ` 75.75 million.

4. Volatility in the market price of gold may adversely affect our financial condition, cash flows and results of
operations. In addition, we may not able to realize the full value of our pledged gold, which exposes us to
potential loss.

Significant portion of our loan portfolio consist of advances that are secured by gold jewellery. As on
September 30, 2014, our gold loans represented 29.54% of the total loans outstanding while it was 29.99%,
38.31% and 32.04% as on March 31, 2012, 2013 and 2014, respectively. A sharp downward movement in the
price of gold could result in a decline in pledged gold values. Further, a sustained decrease in the market price
of gold could also cause a decrease in new gold loans in our loan portfolio and, as a result, our interest income.
In addition, customers may not repay their loans and the gold jewellery securing the loans may have decreased
significantly in value, resulting in losses. If the price of gold decreases significantly, our financial condition,
cash flows and results of operations may be adversely affected.

Further, in the case of a default, we typically sell the pledged gold through publicly announced auctions. There
may be delays associated with the auction process. We cannot assure you that we will be able to sell such
pledged gold at prices sufficient to cover the amounts under default in a timely manner or at all. Any failure to
recover the expected value of pledged gold jewellery could expose us to a potential loss. Any such losses could
adversely affect our business, financial condition and results of operations.

5. Our business, financial condition, results of operations and prospects could be materially and adversely
affected if we are unable to successfully execute our business and growth strategies and manage our growth
effectively.

During the Fiscals ended March 31, 2012, 2013 and 2014, we expanded our business and infrastructure, with
deposits increasing from ` 106,048.70 million as on March 31, 2012, to ` 123,416.26 million as on March 31,
2013 and ` 136,738.61 million as on March 31, 2014, and with net advances increasing from ` 76,635.43
million as on March 31, 2012, to ` 88,515.18 million as on March 31, 2013 and to ` 87,073.62 million as on
March 31, 2014. As on September 30, 2014, our total deposits and total advances were ` 141,655.02 million
and ` 96,087.65 million, respectively.

We continue to develop and implement a number of growth initiatives to become more competitive and
promote sustainable growth. We have increased our focus on building SME advances and LAP products on the
asset side and NRI franchise and retail deposits on the liability side. Due to the increased concentration risk we
are cautious in our lending against gold jewellery. We are also now more cautious in increasing corporate loans.

We have expanded our presence across India through a growing network of branches and ATMs. In Fiscal
2014, we opened 40 new branches of which 34 branches were in non-banking rural centers. Our distribution
network included 232 ATMs as on December 31, 2014, of which 29 ATMs were added in Fiscal 2014 and 7
ATMs in Fiscal 2015. We have front loaded the opening of branches in unbanked rural centers in Fiscal 2014
which can be utilized for a further period of two years and we are entitled to open 59 branches in Tier 1 centers
(metros and urban areas) and 25 branches in semi urban areas without obtaining permission from RBI.
However, pursuant to a letter dated January 30, 2015 from RBI in relation to the broadening of capital base and
listing of the Equity Shares, the general permission to open new branches was withdrawn and our Bank was not
permitted to open any new branches without prior approval of RBI.

We have in the past set targets for our business growth and will continue to set growth targets in the future;
however, there can be no assurance that we will meet our current targets or any future targets. Further, there can
be no assurance that we will be able to continue to successfully implement our growth strategies in a timely
manner or at all, or that any of our new products and services will gain customer acceptance.

Our ability to sustain and manage growth depends primarily upon our ability to manage key operational issues,
such as recruiting and retaining skilled personnel, establishing additional branches, developing and marketing
profitable products and services to cater to the needs of our existing and potential customers in our current

16
 markets, improving our risk management systems to monitor our newer businesses, maintaining and, in a timely
manner, upgrading an effective technology platform, developing a knowledge base to face emerging challenges
and ensuring a high standard of customer service. Sustained growth will put pressure on our ability to
effectively manage and control historical and emerging risks. The expansion of our business activities also
exposes us to a number of risks and challenges, including making incorrect judgments or assumptions as to
customer acceptance of any new products and services, limited or no experience in certain new business
activities, recruiting and training personnel to handle new and existing business activities and enhancing and
expanding our risk management and information technology systems to effectively manage the risks associated
with these new business activities, products and services.

Our ability to sustain and manage growth is also affected by factors outside of our control, such as GDP growth,
changes in regulatory policies, changes in customer demand for loans and changes in interest rates. We may not
be able to successfully maintain growth rates due to unfavorable changes in any one or more of the
aforementioned factors. Our inability to effectively manage any of these operational issues or react to external
factors may materially and adversely affect our business, prospects, financial condition and results of
operations.

6. We may not be able to maintain or grow our CASA ratio in accordance with our strategy.

Our CASA ratio dipped from 19.32 % as on March 31, 2012 to 17.53% as on March 31, 2013 and then further
dipped to 17.27% as on March 31, 2014 and was 17.96% as on September 30, 2014. Our strategy is to continue
to grow our CASA ratio achieved through expanding our client relationships, growing our alternative delivery
channels like internet and mobile banking, improving our business mix and introducing new products.
However, attracting customer deposits in the Indian market is competitive. Though banks are now free to fix
interest rates on savings deposits we are yet to change the rates while many banks are now quoting rates higher
than us. In the future, we may also be forced to increase interest rates to remain competitive and there is no
guarantee that from such move we will be enhancing our customer base enough to compensate for the increase
in interest rates. If we fail to maintain or grow our CASA ratio, our Bank’s financial condition, results of
operations may be materially and adversely affected.

7. We have a concentration of exposure to certain industry sectors, and if such sectors experience any sustained
difficulties, our business could be materially and adversely affected.

We monitor concentration of our exposures to sectors, and calculate sector exposure as required by the RBI. As
on March 31, 2014 and September 30, 2014, our gross credit extended to various industries are shown in table
below. Furthermore, we have substantial exposure to agriculture; micro & small enterprises; education and
housing, which the GoI categorizes as “priority sectors”. As on March 31, 2014 and September 30, 2014,
priority sector advances (including eligible investments) aggregated ` 29,031.50 million and ` 35,390.60
million, respectively, which represented 31.70% and 38.38% of our adjusted net bank credit (“ANBC”),
respectively. Any significant difficulty in a particular sector or industry, driven by events not within our control,
such as regulatory action or policy announcements by government authorities or natural disasters, would
adversely impact the ability of borrowers in that industry to service their debt obligations to us. As a result, we
would experience increased delinquency risk, which may materially and adversely impact our business,
prospects, financial condition and results of operations.

The Bank’s industry exposure as on March 31, 2014 and September 30, 2014 is set forth below:
(` in millions)
Industry/Sector Advances (Fund Exposure as % of Advances (Fund Exposure as % of
Based) Total Advances Based) Total Advances
As on March 31, 2014 As on September 30, 2014
All engineering 973.11 4.00 1,104.57 4.38
Automobiles 1,102.34 4.53 1,022.35 4.05
Cement 65.01 0.27 64.18 0.25
Chemicals 2,437.78 10.01 1,588.98 6.30
Coal 1.99 0.01 2.99 0.01
Construction 3,541.41 14.54 4,207.58 16.68

17
 Industry/Sector Advances (Fund Exposure as % of Advances (Fund Exposure as % of
Based) Total Advances Based) Total Advances
As on March 31, 2014 As on September 30, 2014
Food 1,707.54 7.01 2,561.60 10.16
Infrastructure 3,505.51 14.40 4,055.03 16.08
Iron and steel 160.77 0.66 161.67 0.64
Jewelleries 772.29 3.17 732.47 2.90
Leather 154.44 0.63 134.58 0.53
Mining 418.07 1.72 406.16 1.61
NBFC 744.93 3.06 742.28 2.94
Oil 58.07 0.24 64.35 0.26
Other Industries 2,296.81 9.43 2,033.82 8.06
Other metal and metal
products 484.93 1.99 518.53 2.06
Paper 291.86 1.20 308.77 1.22
Petroleum 21.01 0.09 22.45 0.09
Rubber 253.85 1.04 284.79 1.13
Software 47.43 0.19 50.43 0.20
Sugar 0.05 0.00 0.05 0.00
Tea 46.36 0.19 49.14 0.19
Textiles 5,239.70 21.52 5,081.56 20.15
Tobacco and
Beverages 26.59 0.11 22.95 0.09
Total 24,351.84 100.00 25,221.27 100.00

8. Our business is vulnerable to interest rate and investment related risks. Volatility in interest rates, value of
investments and other market conditions could adversely affect our net interest margin, the value of our
fixed income portfolio, our security receipts, our income from treasury operations, the quality of our loan
portfolio and our financial performance.

Our net interest income amounted to 23.39% and 22.52% of our gross income in the Fiscal 2014 and for the six
months ended September 30, 2014. Net interest income represents the excess of interest earned from interest-
earning assets (such as performing loans and investments) over the interest paid on interest-bearing customer
deposits and borrowings. Our net interest margin for the Fiscals 2012, 2013 and 2014 and the six months ended
September 30, 2014 was 2.85%, 2.64%, 2.58% and 2.39%, respectively.

Interest rates are sensitive to many factors beyond our control, including RBI’s monetary policy, domestic and
international economic and political conditions as well as other factors. Volatility and changes in market interest
rates could disproportionately affect the interest we earn on our assets as compared to the interest we pay on our
liabilities. The difference could result in an increase in interest expense relative to interest income leading to a
reduction in net interest income. Accordingly, volatility in interest rates could materially and adversely affect
our business and financial performance. An increase in interest rates may also adversely affect the rate of
growth of important sectors of the Indian economy, such as the corporate, retail and agricultural sectors, which
may materially and adversely impact our business. Increase in delinquency rates will mean that the interest
income from such advances will no longer accrue and this will further affect the interest income and net interest
income.

Our sources of funding have primarily been customer deposits. Our cost of funds is sensitive to interest rate
fluctuations, which exposes us to the risk of a reduction in spreads. In addition, attracting customer deposits in
the Indian banking industry is competitive. The rates that we must pay to attract deposits are determined by
numerous factors such as the prevailing interest rate structure, competitive landscape, Indian monetary policy
and inflation. If we fail to achieve or sustain continued growth of our deposit base, we may be forced to rely
more heavily on more expensive sources of funding, such as the wholesale market, which could materially and
adversely affect our profitability and business. In addition, interest-earning assets tend to re-price more quickly
than interest-bearing liabilities. Increases in interest rates applicable to our liabilities, without concurrent or
corresponding increases in interest rates applicable to our interest-bearing assets, may result in a decline in our
net interest income, which could materially and adversely affect our business and financial results.

18
 Under RBI regulations, we are required to maintain a minimum specified percentage, currently 21.50%, of our
net demand and time liabilities in Government securities and other approved assets as a statutory liquidity ratio
(“SLR”). Yields on these investments, as well as yields on our other interest-earning assets, are dependent to a
large extent on interest rates and valuation. In a rising interest rate environment, especially if the increase is
sudden or sharp, and/or due to changes in valuation of the investments/assets we could be adversely affected by
a decline in the market value of our Government securities portfolio and other fixed income securities and may
be required to further provide for depreciation in the “Available for Sale” and “Held for Trading” categories.

In a falling interest rate scenario, as we have a significant portion of our investments in short term instruments
like treasury bills and certificate of deposits, these instruments will be re-pricing at maturity to lower rates and
our Interest income will be affected.

As on September 30, 2014, 76.06% of our total gross investments were in Government securities for SLR.
Returns on these investments are dependent to a large extent on interest rates and valuation. As on September
30, 2014, 24.17% and 71.16% of our gross investments were held in the “Available for Sale” and the “Held for
Trading” categories, respectively. For the securities in the “Available for Sale” and “Held for Trading”
categories which are subject to market risk, we are required to mark to market at regular intervals and net
depreciation is recognized and provided, while net appreciation is ignored. In respect of securities under the
“Held to Maturity” category, we are not required to mark the same to market but are required to amortize the
difference between acquisition cost and face value of the security over the residual maturity period of the
security wherever the acquisition cost is greater than the face value. Further, any change in the RBI norms in
relation to limits and other conditions for such categories of investments could adversely affect our business and
financial results.

Our investment portfolio as on September 30, 2014 included security receipts of ` 2,194.78 million issued by
ARCs. As per RBI guidelines these receipts have to be valued on NAV basis. Value of these receipts are
dependent on the value of underlying securities, recoverability, disposability and market factors. Where there is
a decline in value, we will have to make provision for the same and our profitability will be affected to that
extent.

Furthermore, in the event of rising interest rates, our borrowers may not be willing to pay correspondingly
higher interest rates on their borrowings and may choose to repay/pre-pay their loans with us, particularly if
they are able to switch to more competitively priced loans offered by other banks. Our inability to retain
customers as a result of rising interest rates may adversely impact our earnings in future periods. Similarly, in
the event of falling interest rates, we may face more challenges in retaining our customers if we are unable to
offer competitive rates as compared to other banks in the market which could materially and adversely affect
our business and financial results.

9. We may fail to maintain the minimum capital adequacy requirements stipulated by the RBI which could
materially and adversely affect our results of operations and financial condition.

We are subject to regulations relating to capital adequacy of banks, which determines the minimum amount of
capital we must hold as a percentage of the risk-weighted assets on our portfolio, or capital-to-risk asset ratio
(“CRAR”). Although we have been maintaining a CRAR under the Basel II and Basel III standards, which was
11.25% and 11.00%, respectively, as on March 31, 2014 as compared to the regulatory minimum requirement
of 9.00%, there can be no assurance that we will be able to maintain our CRAR within the regulatory
requirements. Further, any adverse developments such as deterioration in our asset quality, decline in the values
of our investments or applicable risk weight for different asset classes could affect our ability to continue to
satisfy the capital adequacy requirements.

On December, 2009, the Basel Committee proposed a number of fundamental reforms to the regulatory capital
framework in its consultative document entitled “Strengthening the Resilience of the Banking Sector”. On
December 16, 2010 and on January 13, 2011, the Basel Committee issued its final guidance on Basel III and
minimum requirements. The Basel Committee proposed that the guidelines be implemented from January 1,
2013. The RBI has issued guidelines on Basel III capital regulations on May 2, 2012. These guidelines have

19
 become effective from April 1, 2013 in a phased manner. The Basel III capital ratios will be fully implemented
by March 31, 2019. With the implementation of the Basel III guidelines, we may be required to improve the
quality, quantity and transparency of Tier I capital, which will now have to be predominantly equity shares. We
may be required to apply regulatory deductions against core capital as opposed to Tier I and Tier II capital and a
minimum capital ratio may be set, among other suggested changes. In addition, these changes may result in the
incurrence of substantial compliance and monitoring costs. Furthermore, with the implementation of Basel III
guidelines, our ability to support and grow our business could be limited by a declining capital adequacy ratio,
if we are unable to access or face difficulty in accessing the capital or have difficulty in obtaining capital in any
other manner. Basel III Capital Standard also requires maintaining Leverage Ratio (which is the ratio of tier 1
capital to total exposure) of 4.5% and banks have to start making public disclosures in this regard from the
quarter ended June 30, 2015.

In addition, the Basel Committee published a guidance report titled “Principles for Sound Liquidity Risk
Management and Supervision” in September 2008 to address the deficiencies that were witnessed in liquidity
risk management during the recent global financial crisis. This was followed by the publication of ‘Basel III:
International framework for liquidity risk measurement, standards and monitoring’ in December 2010 which
introduced two minimum global regulatory standards, namely the LCR and the NSFR and a set of monitoring
tools. The LCR promotes short-term resilience of banks to potential liquidity disruptions by ensuring that they
have sufficient high quality liquid assets to survive an acute stress scenario lasting for 30 days. The NSFR
promotes resilience over longer-term time horizons by creating additional incentives for banks to fund their
activities with more stable sources of funding on an ongoing structural basis. On November 7, 2012, the RBI
issued guidelines to consolidate the various instructions or guidance on liquidity risk management and to
harmonize and enhance these instructions or guidance in line with the Principles for Sound Liquidity Risk
Management and Supervision as well as the RBI Basel III capital regulations. They include enhanced guidance
on liquidity risk governance, the measurement, monitoring and reporting of liquidity positions to the RBI and
minimum global regulatory standards of LCR and NSFR.

The RBI or any other relevant authority may implement the package of reforms, including the terms which
capital securities are required to have, in a manner that is different from that which is currently envisaged, or
may impose more onerous requirements. There can be no assurance that we will be able to comply with such
requirements or that any breach of applicable laws and regulations will not adversely affect our reputation,
business, financial condition and result of operations.

If we fail to meet capital adequacy requirements (including leverage ratio), RBI may take certain actions,
including restricting our lending and investment activities, further balance sheet growth and the payment of
dividends by us. These actions could materially and adversely affect our reputation, results of operations and
financial condition.

10. Some of our corporate records, including records on allotments of our equity shares in the past are not
traceable.

We are unable to trace copies of certain corporate records and filings in relation to equity shares issued and
allotted by our Bank in the past. In particular, we have been unable to trace: (i) corporate resolutions and filings
with the RoC in relation to changes in our authorised share capital from incorporation till the financial year
ended December 31, 1961; (ii) resolutions for the issue and allotments of equity shares from its incorporation on
November 26, 1920 till the financial year ended December 31, 1982; and (iii) filings with the RoC in relation to
issue and allotment of Equity Shares from its incorporation on November 26, 1920 till the financial year ended
March 31, 1991. While we believe that these forms were duly filed on a timely basis, we have not been able to
obtain copies of these documents, including from the RoC and have placed reliance on other documents,
including board resolutions and their agenda for allotment of shares, annual reports and audited financial
statements for corroborating the share capital history of our Bank for such periods.

Further, we have not been able to trace a copy of the certificate of commencement of business which was issued
to our Bank. In this regard, upon an application made and visit to the office of the RoC on February 23, 2005,
requesting for the issuance of a duplicate certificate, it was intimated to us that the RoC had no records of the
original certificate of commencement of business, and hence a duplicate certificate could not be issued.

20
 We cannot assure you that these form filings and corporate records will be available in the future or that we will
not be subject to any penalty imposed by the competent regulatory authority in this respect.

11. If our existing customers and targeted customers are not receptive to any changes to our brand identity or
promotional activities, our business and results of operations could be adversely affected.

To increase our business we intend to further strengthen our brand which may include changes to our brand
identity. Promoting and positioning our brand will depend largely on the success of our marketing efforts and
our ability to provide high quality services. Brand promotion activities may not yield increased revenues, and
even if they do, any increased revenues may not offset the expenses we incur in building our brand. Further, our
existing customers and targeted customers may not be receptive of our new brand. If we fail to promote and
maintain our brand, our business, financial condition and results of operations could be adversely affected.

12. We are required to maintain cash reserve ratio (“CRR”) and statutory liquidity ratio (“SLR”) and any
increase in these requirements could materially and adversely affect our business, financial condition and
results of operations.

As a result of the statutory reserve requirements stipulated by the RBI, we may be more exposed structurally to
interest rate risk than banks in other countries. Under the extant RBI’s regulations, we are subject to a CRR
requirement under which we are currently required to keep 4.00% of our net demand and time liabilities in
current account with the RBI. We do not earn interest on cash reserves maintained with the RBI. The RBI may
further increase the CRR requirement as a monetary policy measure and has done so on numerous occasions.
Increases in the CRR requirement could materially and adversely affect our business, net interest income,
results of operations and financial condition.

In addition, under the RBI’s regulations, our liabilities are subject to a SLR requirement, according to which
21.50% of our net demand and time liabilities need to be invested in Government securities, state Government
securities and other securities approved by the RBI from time to time. In our experience, these securities
generally carry fixed coupons which are typically lesser than the interest rates we pay on our term deposits.
When the interest rate rises, the value of these fixed coupon securities depreciates. We cannot assure you that
investment in such securities will provide returns better than other market instruments. Further, any increase in
the CRR and the SLR requirements, would reduce the amount of cash available for lending, which may
materially and adversely affect our business, financial condition and results of operations.

13. Our funding requirements are primarily met through customer deposits. If we fail to sustain or achieve
growth of our deposit base, including our current and savings account deposit base, our business may be
adversely affected.
We meet our funding requirements through short-term (i.e. maturity up to one year) and long-term (i.e.,
maturity for more than one year) deposits from retail depositors (deposits of less than ` 10 million and
wholesale depositors (deposits of ` 10 million and above). Banks usually face an asset-liability mismatch due to
the difference in maturity patterns of their liabilities and assets. Where maturing liabilities are more than the
assets there is a negative mismatch and a potential liquidity problem.
As on September 30, 2014, we have an asset liability mismatch. The bucket-wise mismatches are as under:
(` in millions)
Mismatch Cumulative Mismatch Mismatch (in%)
Next Day 1,130.51 1,130.51 33.84
2-7 days 2,747.25 3,877.76 125.21
8-14 days 2,695.83 6,573.59 71.68
15-28 days 3,242.90 9,816.49 154.65
29days-<3 months 2,203.60 12,020.09 25.15
3months-<6 months 84.70 12,104.79 0.92
6 months -<1 year 14,567.85 26,672.64 125.34
1 year -<3 year 5,883.69 32,556.33 17.77

21
 3 year -<5 year 3,367.60 35,923.93 84.79
> 5 year (35,548.83) 375.10 (44.41)
Total 375.10 375.10 0.24
Mismatch has been arrived at by subtracting total inflows from total outflows
Mismatch percentage has been arrived at based on the formula: (total inflows – total outflows) x 100
Total outflows

Though as of now we are running positive mismatches in all the buckets up to five years the data is subject to
various assumptions on renewal of retail term deposits, behavior of non-maturity deposits (CASA and loans
(overdrafts and cash credits) and repayments of short and long term loans. Non-renewal of retail term deposits
or higher than expected volatility in non-maturity deposits or delay in repayment of loans or increasing the
proportion of long term loans can alter the mismatch position of the bank adversely. Consequently, we may face
liquidity problem. As a result, we may be required to pay higher rates to attract deposits, which may have an
adverse impact on our business and results of operations.

Any failure on our part to minimize the asset liability mismatch resulting in higher liquidity risk may adversely
affect our business, financial condition and results of operations.

For details of Slotting Criteria for Daily Structural Liquidity Statement, see the section titled “Select Statistical
Information” on page 221.

14. We have a concentration of loans to certain customers, and if the financial conditions of these customers
deteriorate, our asset quality, financial condition and results of operations could be materially and adversely
affected.

We monitor concentration of our exposure levels to borrowers, and calculate customer exposure as required by
the RBI. As on March 31, 2012, 2013, 2014 and September 30, 2014, the aggregate exposure to our 20 largest
borrowers (in standard assets category) amounted to ` 12,145.80 million, ` 11,883.30 million, ` 13,141.50
million and ` 13,704.10 million, representing 13.26%, 11.50%, 12.53% and 12.06%, respectively, of our total
exposure as on such dates. Our exposure to our single largest borrower as on March 31, 2012, 2013, 2014 and
September 30, 2014 was ` 1,980.40 million, ` 2,442.60 million, ` 2,714.40 million and ` 2,677.30 million,
representing 2.16%, 2.36%, 2.59% and 2.36% of our total exposure as on such date. If any of our 20 largest
borrowers’ loans becomes non-performing, the credit quality of our portfolio and our business and financial
results could be materially and adversely affected.

15. Our success depends largely upon our management team and skilled personnel and our ability to manage
attrition as well as to attract and retain personnel.

We believe that the breadth of experience of our management team coupled with their in-depth knowledge of
banking operations and management provides the anchor to continue building a robust and sustainable
organization. Our management’s capabilities, strong reputation, extensive network of industry relationships and
extensive experience in the finance and banking industry are the key to our growth, modernization and
development. We rely heavily on the expertise and experience of our Key Management Personnel.

Our performance and success depends largely on our ability to nurture and retain the continued service of our
management team and skilled personnel. A considerable portion of our senior management, having been
associated with out Bank for several years, is due to retire in the next few years. Further, there is significant
competition for management and other skilled personnel in the banking industry. There is no assurance that we
will not lose our key management personnel to our competitors that may offer more competitive remuneration
packages and other benefits. Any increase in our attrition levels may add to our personnel expenditure. Our
failure to retain our management team and skilled personnel or attract new talent to aid our growth and carry out
our strategies could materially and adversely affect our business, prospects, financial condition and results of
operations.

22
16. We have a concentration of deposits from certain depositors, which exposes us to liquidity risk, the
crystallization of which could materially and adversely affect our business, financial conditions, result of
operations and prospects.

As on September 30, 2014, our Bank’s total deposits were ` 141,655.02 million, compared with ` 136,738.61
million, ` 123,416.26 million and ` 106,048.70 million on March 31, 2014, 2013 and 2012, respectively. As on
September 30, 2014, our top 20 depositors constituted 13.65% of our total deposits. If any or a substantial
number of our top 20 depositors withdraw their deposits or do not roll over their time deposits upon maturity,
we may be required to seek more expensive sources of funding, including paying higher interest rates in order
to attract and/or retain further deposits, and we cannot assure you that we will be able to obtain additional
funding on commercially reasonable terms as and when required. In such an event, our Bank’s liquidity
position, financial condition, results of operations may be materially and adversely affected.

17. Our auditors have qualified certain matters and highlighted certain matters of emphasis in relation to our
financial statements for the six months ended September 30, 2014 and Fiscals 2011, 2012, 2013 and 2014.

Our auditors for the respective periods have qualified certain matters and highlighted certain matters of
emphasis in relation to the financial statements for the six months ended September 30, 2014 and Fiscals 2011,
2012, 2013 and 2014.

Six months ended September 30, 2014 (Qualification)

“The bank has classified two advances aggregating ` 1,161.90 million as standard, which were classified as
non-performing as on 31.03.2014 in the Annual Financial Inspection Report of the Reserve Bank of India dt.
23.10.2014. Accordingly, the provision required for NPA to that extent of ` 165 million as also the reversal of
interest ` 61.9 million (including ` 48.4 million taken credit for in the half year ended 30.09.2014), required in
respect of the said accounts have not been made. Had the adjustments for the above, as also credit for deferred
tax asset, are made in the accounts, the loss for the period will be higher by ` 114.00 Million and in the
Balance Sheet, the Reserves and Surplus, Advances and other liabilities will be lower by ` 114 million, ` 207.4
million and ` 34.8 million respectively and other assets will be higher by ` 58.6 million, with consequential
impact as disclosure of Non-performing assets, Restructured assets, Capital Ratio and Deferred Tax in the said
accounts.”

Fiscal 2013 (Qualification)

“The financial statements are prepared after incorporating the returns of 28 branches/offices audited by central
statutory auditors, 325 branches/offices audited by branch auditors and unaudited returns of 55
branches/offices in respect of which exemption has been availed as directed by Reserve Bank of India, in
consultation with central statutory auditors in respect of which, the exemption from the Central Government
required under rule 4(1) (a) of the Companies (Branch Audit Exemption) Rules 1961 from the provisions of sub
sections (1) and (3) of Section 228 of the Companies Act, 1956 has not obtained. These unaudited branches
account for 1.59 per cent of advances, 5.82 per cent of deposits, 1.35 per cent of interest income and 5.54 per
cent of interest expense.”

Fiscals 2011, 2012, 2013 and 2014 and the six months ended September 30, 2014 (Matter of emphasis)

“Without qualifying our opinion, the central statutory auditors draw attention to Note No. 8.3.2 (31.03.2011),
3.3 (31.03.2012 to 31.03.2014 and 30.09.2014), to the financial statements, which describes deferment of
pension and gratuity liability of the bank to the extent of ` 483.80 million (31.03.2011), ` 362.80 million
(31.03.2012), ` 241.90 million (31.03.2013) ` 121 million (31.03.2014) ` 60.50 million (30.09.2014) pursuant
to the exemption granted by the Reserve Bank of India to the bank, from the application of the provisions of
Accounting Standard (AS) 15 relating to employee benefits vide its circular no. DBOD.BP BC
80/21.04.018/2010-11 dated 09.02.2011 and RBI letter DBOD.BP BC 15896/21.04.018/2010-11 dated
08.04.2011 on reopening of pension option to employees of the bank and enhancement in gratuity limits
Prudential Regulatory Treatment.”

23
 If such qualifications and matters of emphasis are highlighted are contained in future audit reports, the price of
our Equity Shares may be adversely impacted.

18. We have significant contingent liabilities and any realization of our contingent liabilities could materially
and adversely affect our business, financial conditions, result of operations and prospects.

As on March 31, 2012, 2013 and 2014 and September 30, 2014, we had contingent liabilities amounting to `
9,764.63 million, ` 8,567.05 million, ` 11,380.52 million and ` 8,800.17 million, respectively. For details, see
the section titled “Financial Information” on page 190. The contingent liabilities (including claims against our
Bank not acknowledged as debts, liability on account of outstanding forward exchange contracts, guarantees
given on behalf of constituents, acceptances, endorsements and other obligations and other items for which our
Bank is contingently liable) have arisen during the normal course of business. We are subject to liquidity risk
and credit risk on our off-balance sheet commitments because these commitments may need to be fulfilled by us
in certain circumstances. In the event that any of the above liabilities realizes, we may be required to honor the
demands raised. If we are unable to recover payment from our customers in respect of the commitments that we
are called upon to fulfill, our business, financial conditions, result of operations and prospects may be materially
and adversely impacted.

19. ‘We have revalued certain assets in the past, which has resulted in increase in our ‘reserves and surplus’.
These reserves are not free reserves and we may not be able to utilise these for distribution as dividends or
bonus shares to our shareholders.

Our Bank has undertaken revaluation of land and buildings during Fiscals 1991, 1994, 1999, 2005, 2007, 2008
and 2013. As on March 31, 2012, 2013, 2014 and the six months ended September 30, 2014, our revaluation
reserves were ` 387.66 million, ` 1,267.12 million, ` 1,253.11 million and ` 1,246.45 million, respectively.

Such revaluations resulted in appreciation in the value of said assets with corresponding increase in credit to our
reserve and surplus and depreciation over and above the normal depreciation attributable to revalued assets
which were set off against the revaluation reserve. However, as per the Accounting Standards issued by the
Institute of Charted Accountants of India (“ICAI”), we cannot use these reserves to distribute either dividends
or bonus shares to our shareholders. For details of revaluation, please see section titled “Financial Statements”
on page 190.’

20. We are involved in certain legal and other proceedings in India and may face certain liabilities as a result of
the same.

We are involved in various criminal, recovery, civil, consumer and tax-related litigations, which are at different
stages of adjudications before various legal and statutory fora. We are involved in litigations for a variety of
reasons, including for recovery of outstanding amounts from defaulting borrowers, criminal proceedings
initiated with respect to frauds committed against our Bank, online frauds committed against us, labour
proceedings and industrial disputes initiated by our former or current employees as well as or claims by
customers during the process of recovery of our monies or for service related issues. A summary of the
litigation currently involving our Bank is set out below:

SI. No. Nature of Litigation No. of Cases Amount involved*

(` in millions)
1. Criminal proceedings 75** -
2. BIFR proceedings 6 852.40***
3. Recovery Proceedings 3,302 1,962.87
4. Civil matters 69 49.66
5. Consumer complaints 27 29.87
6. Complaints before the Banking Ombudsman 3 0.03
7. Labour proceedings 34 -
8. Direct taxation matters 28 1,458.82
9. Indirect taxation matters 3 3.72
10. Cases filed under Section 138 of the Negotiable Instruments 9 20.48

24
 Act
Total 3,556 4,377.85
*
to the extent quantifiable.
** including 65 frauds reported to RBI under FMR-1.
***
amounts involved in matters where substitution has been initiated, have not been included.

Further, as on March 24, 2015, there are 37 legal notices pending against us, and the aggregate amount claimed
against us, to the extent quantifiable, is approximately ` 21.70 million, and two pending notices, involving an
aggregate amount of ` 100.96 million.

Should any new developments arise, such as a change in law or rulings against us by courts or tribunals, we
may need to make provisions in our financial statements, which could adversely impact our reported financial
condition and results of operations. If any of the cases pending are decided against us, or if additional penalties
are assessed and/or sanctions imposed on us in the future for failures to comply with KYC or other required
procedures, it may have a material adverse effect on our businesses, reputation, financial condition and results
of operations.

21. The value of our collateral may decrease or we may experience delays in enforcing our collateral if
borrowers default on their obligations, which may result in failure to recover the expected value of
collateralized security exposing us to potential losses.

As on September 30, 2014, 95.62% of our advances were secured by collateral, including real estate assets,
property, gold ornaments, plant, equipment, inventory, receivables, current assets and pledges or charges on
fixed assets, bank deposits, NSC/KVP/LIC policy or financial assets such as marketable securities and
guarantees. The value of the collateral securing our loans, including, in particular, any property and gold
jewellery, may significantly fluctuate or decline due to factors beyond our control, including those affecting the
Indian and global economy in general.

In the event our borrowers default on the repayment of loans, we may not be able to realize the full value of the
collateral due to various reasons, including a possible decline in the realizable value of the collateral, defective
title or pledge of spurious items as security, prolonged legal proceedings and fraudulent actions by borrowers,
or we may not be able to foreclose on collateral at all. Further, certain kinds of loans that are advanced by us are
not secured by any assets.

In terms of the Banking Regulation Act, 1949, a banking company is not permitted to hold any immovable
property (except as is required for its own use), for any period exceeding seven years, or as may be extended by
RBI for a period not exceeding five years, on a case to case basis. Such restriction may force us to dispose off
the collateral, upon foreclosure, without realizing the full value of such collateral.

A decline in the value of the security could impair our ability to realize the secured assets upon any foreclosure,
which would likely require us to increase our provision for loan losses. In the event of a default with respect to
any of these loans, the amounts we receive upon sale of the secured assets may be insufficient to recover the
outstanding principal and interest on the loan. If we are required to re-value the assets securing a loan to satisfy
the debt during a period of reduced asset values or to increase our allowance for loan losses, our profitability
could be adversely affected, which could have a material adverse effect on our business, financial condition,
results of operations and prospects.

In India, foreclosure on collateral may be subject to delays and administrative requirements that may result, or
be accompanied by, a decrease in the value of the collateral. Although legislations, such as the SARFESAI Act,
strengthen the rights of lenders to enforce security and recover amounts owed from secured borrowers, there
can be no assurance that such legislation will have a favorable impact on our efforts to reduce our levels of
NPAs and we may not be able to realize the full value of our secured assets, due to, among other things, delays
in foreclosure proceedings, defects in the perfection of secured assets, fraudulent transfers by borrowers and
decreases in the values of secured assets.

In addition, the RBI’s guidelines on corporate debt restructuring specify that for debt amounts of `100 million
and above, 60% of the creditors by number and 75% of creditors by value can decide to restructure the debt and

25
 that such a decision would be binding on the remaining creditors. If we own 25% or less of the debt of a
borrower, we may not be able to realize the full value of our secured assets and could be forced to agree to an
extended restructuring of debt which may not be in our interests.

Our inability to realize the full value of assets securing our loans on a timely basis or at all, including if we are
instead compelled to restructure our loans, could materially and adversely affect our asset quality, business,
results of operation and financial condition.

22. The Indian banking industry is very competitive and our success will depend on our ability to compete
effectively.

We face competition from public and private sector Indian commercial banks and foreign commercial banks in
all our products and services. Some of such banks are large institutions and may have much larger customer and
deposit bases, larger branch networks and wider capital base. We also face competition in some or all of our
products and services from NBFCs, post office savings schemes, exchange houses, micro financing institutions,
co-operative banks and other entities operating in the financial sector.

Further liberalisation of the Indian financial sector could also lead to a greater presence or new entries of Indian
and foreign banks offering a wider range of products and services, which could adversely affect our competitive
environment.

RBI has come out with a set of guidelines for licensing of new banks in the private sector in February 2013. The
process of licensing culminated with the granting of “in-principle” approval to two applicants who would set up
new banks in the private sector within a period of 18 months. While announcing the decision to grant “in-
principle” approval to the two applicants, RBI indicated that going forward it would use the learning experience
from this licensing exercise to revise the guidelines appropriately and move to grant licenses more regularly on
“tap” basis.

RBI is working on a policy of having various categories of “differentiated” bank licenses which will allow a
wider pool of entrants into banking. Guidelines for licensing payment banks and small banks have been issued
in November 2014. These changes in the regulatory environment have the effect of lifting of entry barriers in
the industry, which may not be favourable for existing players like us.

We also compete with foreign banks having operations in India. In November 2013, the RBI released a
framework for the setting up of wholly owned subsidiaries (“WOS”) in India by foreign banks. The framework
encourages foreign banks to establish a presence in India by granting rights similar to those received by Indian
banks, subject to certain restrictions and safeguards. Under the current framework, WOS of foreign banks are
allowed to raise Rupee resources through issue of non-equity capital instruments. Further, WOS of foreign
banks may be allowed to open branches in Tier 1 to Tier 6 centres (except at a few locations considered
sensitive on security considerations) without having the need for prior permission from RBI in each case,
subject to certain requirements. The guidelines may result in increased competition from foreign banks.

Banks like us are also facing increasing competition from non-banks including NBFCs and MFIs. Going ahead,
there may be increase in the non-bank related financing activities through innovations like Peer-to-Peer (P2P)
lending. P2P lending also referred to as ‘social investing’, ‘marketplace lending’ or ‘direct consumer lending’ is
the practice of borrowing and lending of money among unrelated individuals and business entities, on the online
platforms, without any role of a traditional financial intermediary like a bank or a non-banking financial
institution.

Our future success will depend in large part on our ability to respond in an effective and timely manner and our
ability to compete effectively. Increased competitive pressure may have an adverse impact on our business,
financial condition and results of operations.

23. Majority of our business premises is leased. Accordingly, we are exposed to risks typical to leasing of
commercial real estate.

26
 As on December 31, 2014, we had 431 branches and 232 ATMs, majority of which were located on leased
premises. As on December 31, 2014, some of our leases, including leases of certain of our top 25 branches
(identified on the basis of total business) had expired and were in the process of being renewed. Termination of
or failure to renew lease agreements for these premises on terms and conditions favorable to us or at all may
require us to shift the concerned branch offices or the ATMs to new premises. This might adversely affect our
business operations and incur additional expenses.

24. We focus and intend to continue to focus on our SME business. The growth of our SME business depends
on the performance of the SME sector in India, competition from public and private sector banks and
financial institutions and NBFCs, and government policies and statutory and/or regulatory reforms in the
SME sector.

As on September 30, 2014, 43.18% of our total advances were to our SME customers. In recognition of the
contribution and vast potential of the small enterprises finance sector in the economy, provision of adequate
credit to this sector continues to be an important element of banking policy. The Government of India has from
time to time taken economic policy initiatives to promote this sector and enhance credit to small and medium
enterprises. Some of the initiatives of the Government to support small enterprise financing include setting up a
credit guarantee fund trust for small industries, risk sharing facilities, venture capital funding and micro credit.
The small enterprises finance sector currently is catered to largely by public sector banks, public financial
institutions and local unorganized private financiers.

Any change in the regulatory requirements in connection with the SME sector, change in government policies,
slowdown in liberalization and reforms affecting the sector could affect the performance of SMEs and demand
for SME finance, and, in turn, our business and results of operations.

25. We may be unable to sustain the growth rate of our NRI banking business, which could adversely impact our
financial results.

As a part of our growth strategy, we intend to focus on expanding our NRI banking business. We have achieved
significant growth in our NRI banking business in recent years. As on March 31, 2013, 2014 and September 30,
2014, our total NRI deposits constituted 13.47 %, 17.27 % and 18.50 %, respectively, of our total deposits.

We intend to continue our focus on further growth in NRI banking business by offering new products and
services. While we anticipate continued demand in the NRI banking business, growth of our NRI portfolio is
subject to various factors including geographic location of our branches, availability of funding in such
locations, quality of products offered, demand from NRIs and competitiveness at such locations. We cannot
assure you that we will be able to grow at the rates we have experienced in the past, which could materially and
adversely affect our business, financial condition and results of operations.

26. We are subject to annual financial inspection (“AFI”) by RBI. Non-compliance with RBI observations could
subject us to impositions of penalties and restrictions by RBI, and adversely affect our business, financial
condition or results of operations.

We are subject to an AFI by RBI under the Banking Regulation Act. In the past certain observations were made
by RBI during the AFI regarding our business and operations in its AFI reports. In these reports, the RBI has
identified certain deficiencies in the operations of our Bank in, inter-alia, the following areas:

 credit appraisal practices;

 priority sector lending;
 monitoring and detection of frauds;
 KYC compliance; and
 Adherence to internal policy, procedure and limits.

While we attempt to be in compliance with all regulatory provisions applicable to us, in the event we are not
able to comply with the observations made by the RBI, we could be subject to penalties and restrictions which
may be imposed by the RBI. Imposition of any penalty or restriction by RBI may have a material adverse effect

27
 on our reputation, financial condition and results of operations.

The RBI conducts annual on-site inspections on all matters addressing our banking operations and relating to,
among other things, our Bank’s portfolio, risk management systems, credit concentration risk, counterparty
credit risk, internal controls, credit allocation and regulatory compliance. During the course of finalizing this
inspection, the RBI inspection team shares its findings and recommendations with us and provides us an
opportunity to provide clarifications, additional information and, where necessary, justification for a different
position, if any, than that observed by the RBI. The RBI incorporates such findings in its final inspection report
and, upon final determination by the RBI of the inspection results, we are required to take actions specified
therein by the RBI to its satisfaction, including, without limitation, requiring us to make provisions, impose
internal limits on lending to certain sectors and tighten controls and compliance measures and restricting our
lending and investment activities. Any significant deficiencies identified by the RBI that we are unable to
rectify to the RBI’s satisfaction could lead to sanctions and penalties imposed by the RBI, as well as expose us
to increased risks. Furthermore, the RBI is currently in the process of implementing risk-based supervision in a
phased manner. Our Bank is yet to experience and adapt to any additional compliance and data requirements to
be imposed by risk-based supervision. Any failure to meet other RBI or the SEBI requirements could materially
and adversely affect our reputation, business, financial condition, results of operations, pending applications or
requests with the RBI and our ability to obtain the regulatory permits and approvals required to expand our
business.

27. Our agreement with NABARD for obtaining of refinance assistance contains certain restrictive covenants.

We have entered into a loan agreement dated January 22, 1979 (“Refinance Agreement”) with Agricultural
Refinance Corporation (which was succeeded by NABARD upon the enactment of the NABARD Act) in
respect of refinance facilities obtained by our Bank. For details please see section titled “Financial
Indebtedness” on page 248. In terms of the Refinance Agreement, the loan agreements we enter into with our
borrowers are required to include provisions giving NABARD certain rights, including in relation to the loans
and security created for such loans and right to inspect our borrowers’ premises. We may not have been in
compliance with such provisions of the Refinance Agreement and cannot assure you that such non-compliance
will not result in us being in default under the terms of the Refinance Agreement.

28. We may face labor disruptions that could interfere with our operations and we may be unable to manage our
employee costs and expenses.

We are exposed to the risk of strikes and other industrial actions by our employees as well as trade unions that
our employees are be part of. As on December 31, 2014, 1,559 out of our 1,569 officers (Grade I to III), 1,097
out of our 1,148 clerks, 129 out of our 129 peons and 48 out of our 50 part time sweepers were members of
trade unions. In the year 2007, Bank’s Calcutta branches (Lal Bazar and Burra Bazar) were closed for 93 days
due to the strike called for by The Catholic Syrian Bank Ltd Staff Union.

We cannot guarantee that our employees will not undertake or participate in strikes, work stoppage or other
industrial action in the future. Any such employee unrest events could disrupt our operations, possibly for a
significant period of time, result in increased wages and other benefits or otherwise have a material adverse
effect on our business, financial condition or results of operation.

Further, we expect our operating expenses on account of payment to and provision for employees to increase
significantly after the implementation of the 10 th Bipartite Wage Revision Settlement between the management
of A Class Scheduled Banks like us (represented by the IBA) and their workmen (represented by various labour
unions and officers’ associations) (“10th Bipartite Settlement”). As on February 2015, the terms of the 10 th
Bipartite Settlement as mutually agreed between the parties include a 15% annual wage increase in salary and
allowances for employees of A Class Scheduled Banks (on salary slip components) effective (when
implemented) from November 1, 2012 and every second and fourth Saturday to be designated as a holiday, and
the other Saturdays designated as full working days. An inability to effectively manage such cost and expense
escalations could affect our income and profitability.

28
 Further, there are several cases filed against us by our former or current employees before various tribunals and
courts, in relation to claims for allegedly wrongful termination of service, reinstatement along with back wages,
promotions, transfers, claims pertaining to terminal benefits and disciplinary actions taken against them. If any
of the cases pending are decided against us, we may be subject to payment of back-wages, compensations or
may even be required to re-instate the employees, which could increase our personnel retention and
administrative costs and adversely affect our financial condition and results of operation.

29. We have limited access to credit and other financial information on borrowers than banks in other
economies, which may decrease the accuracy of our assessments of credit risks and thereby increase the
likelihood of borrower defaults.

Our principal activity is to provide financing to borrowers located in India. The credit risk of our borrowers,
including retail customers, SMEs, small and mid-sized corporates, agricultural and rural customers and priority
sectors, may be higher than in other economies due to the higher uncertainty in our regulatory, political and
economic environment and the inability of our borrowers to adapt to global technological advances. Our
corporate borrowers may suffer from low profitability because of increased competition as a result of economic
liberalization policies, a sharp decline in commodity prices, a high debt burden and high interest rates in the
Indian economy and other factors.

In addition, India’s system for gathering and publishing statistical information relating to the Indian economy
generally or specific economic sectors within it or corporate or financial information relating to companies or
other economic enterprises is not as comprehensive as in the countries with established market economies. The
absence of such reliable and comprehensive statistical, corporate and financial information, including audited
financial statements and recognized debt and credit rating reports, relating to our present and prospective
corporate borrowers or other customers makes the assessment of credit risk, including the valuation of
collateral, more difficult. Many of the nationwide credit bureaus have become operational in India in recent
years, and it may be some time before comprehensive information on the credit history of our borrowers,
especially individuals and small businesses, is available to us. In many cases, we need to rely on the accuracy
and completeness of information furnished by or on behalf of customers and counterparties, including financial
statements and financial information. The difficulties associated with the inability to accurately assess the value
of collateral and to enforce rights in respect of collateral, along with the absence of such accurate statistical,
corporate and financial information, may decrease the accuracy of our assessments of credit risk, thereby
increasing the likelihood of borrower default on the loans provided by us and decreasing the likelihood that we
would be able to enforce any security in respect of such loans or that the collateral will have a value
commensurate to the respective loan. Moreover, the availability of accurate and comprehensive credit
information on retail customers and small businesses in India is even more limited than for larger corporate
customers, which reduces our ability to accurately assess the credit risk associated with lending to this category
of borrowers.

Such difficulties in assessing credit risks associated with our day-to-day lending operations and risks associated
with the business environment in India may lead to an increase in the level of our non-performing and
restructured assets, which could materially and adversely affect our business and financial results.

30. We intend to focus on growing our high margin fee-based income, including by selling life insurance
products. Our agreement with Edelweiss Tokio Life Insurance Company Limited to distribute life insurance
products contains certain covenants which may adversely affect our ability to grow this segment.

An important strategic focus for us is to grow our high margin fee-based income. We intend to focus on
increasing our fee-based income by increasing the fee-based services we provide and expanding our third party
product offerings, including life insurance products.

We have entered into arrangement to distribute life insurance products of Edelweiss Tokio Life Insurance
Company Limited (“ETLIC”) pursuant to an agreement dated September 14, 2013. In terms of this agreement
we are required to solicit and procure insurance business exclusively for ETLIC, as its corporate agent. Further,
in the event that applicable laws mandate that we act as an agent of more than one life insurance company, we

29
 are required to disclose the terms and conditions of any such arrangement to ETLIC, obtain prior consent from
ETLIC and in all circumstances give ETLIC preferred partner status.

In the event the terms, including the ones mentioned above, under this agreement impede our ability to grow our
insurance business, our financial condition and results of operations may be adversely affected.

31. A portion of our advances are unsecured. In case we are unable to recover such advances in a timely manner
or at all, it may adversely affect our business, financial condition and results of operations.

As on March 31, 2012, 2013, 2014 and September 30, 2014, 3.93% (or ` 3,009.06 million), 3.52% (or `
3,119.92 million), 3.66% (or ` 3,184.73 million) and 4.38% (or ` 4,126.74), respectively, of our advances were
unsecured. While we have been selective in our lending policies and strive to satisfy ourselves with the credit
worthiness and repayment capacities of our customers, there can be no assurance that we will be able to recover
the interest and the principal advanced by us in a timely manner or at all. Any failure to recover the unsecured
advances given to our customers would expose us to a potential loss that could adversely affect our business,
financial condition and results of operations.

32. Some of the agreements entered into by us in relation to leased property may be inadequately stamped and
may have certain irregularities in title such as non-registration of lease deeds, which could adversely affect
our financial health.

Some of the lease agreements entered into by us may be inadequately stamped. As a result, these agreements
may be inadmissible as evidence before a court of law. Further, some of the immoveable properties used by us
and taken on lease may have one or more irregularities of title such as non registration of lease deeds. We
cannot assure you that we would be able to enforce our rights under such agreements or in respect of such
immovable properties, and any inability to do so, could impair our operations and adversely affect our financial
condition.

33. Any downgrading in our credit ratings could adversely affect our business, financial condition and results of
operations.

Rating agency CARE (Credit Analysis and Research Ltd) has rated our Bank’s Lower Tier II Bonds at CARE
BBB (Triple B), which stands for “Instruments with this rating are considered to have moderate degree of safety
regarding timely servicing of financial obligations. Such instruments carry moderate credit risk”. These ratings
assess our overall financial capacity to pay our obligations and are reflective of our ability to meet financial
commitments as they become due. Any downgrading in our credit ratings in the future may adversely affect our
ability to raise capital on reasonable commercial terms and mobilize deposits and therefore adversely affect our
business.

34. We require certain regulatory approvals for operation or growth of our business, and the failure to obtain
the same in a timely manner or at all may subject us to sanctions and penalties pursuant to inspection and
supervision by regulatory authorities, including the RBI and the SEBI, or otherwise adversely affect our
operations.

We require regulatory approvals, licenses, registrations and permissions, at corporate as well as branch levels,
for operating our business, some of which would require renewal from time to time. We are also required to
obtain memberships with certain regulatory organizations, such as the IRDA, to undertake some of our
operations. We may not receive such approvals or memberships, or may be unable to obtain renewals within the
prescribed time frames or at all, which could adversely affect our business.

Our registration for distributing third-party mutual fund products pursuant to SEBI circular No.
MFD/CIR/20/23230/2002 dated November 28, 2002, issued by the Association of Mutual Funds of India
(Reference No. ARN – 18031) on March 24, 2009, expired on March 23, 2014 and we are yet to apply for
renewal of this registration.

30
 We have not obtained licenses under the relevant state legislations governing the registration of shops and
establishments for certain of our branches, including certain of our top 25 branches (identified on the basis of
total business). Further, apart from the requirement of obtaining license, we may not be in compliance with the
other provisions of such legislations, which may be applicable to us.

In the event the competent authority under the relevant state legislations governing the registration of shops and
establishments, finds us in violation of such legislation and imposes statutory penalty for not obtaining the
registration, our business and results of operations may be adversely affected.

Further, we have licenses from RBI for our banking and other operations, and are also registered as a merchant
banker with SEBI. However, our operations are subject to continued review and possible changes to the
governing regulations. Failure to obtain, renew or maintain any required approvals, permits or licenses in
accordance with the regulations and any amendments thereto, may result in the interruption of all or some of
our operations, imposition of penalties and could materially and adversely affect our business and financial
results. For further details see the sections titled “Regulations and Policies” and “Government and Other
Approvals” on pages 149 and 330.

35. Our ability to open branches in Tier 1 centers is subject to fulfillment of certain eligibility criteria prescribed
by the RBI. If we are unable to fulfill such eligibility criteria and, as a result, are unable to open new
branches in Tier 1 centers, we may be unable to grow our deposit base that may in turn adversely affect our
business prospects.

As on December 31, 2014, we had 431 branches and 232 ATMs across India. The opening of new branches and
shifting of existing branches of banks is governed by the provisions of the Banking Regulation Act and RBI
guidelines. Domestic scheduled commercial banks are permitted to open branches in Tier 2 to Tier 6 centers,
without permission from the RBI, subject to reporting requirements to RBI. Further, in terms of the RBI
circulars dated September 19, 2013 and October 21, 2013, domestic scheduled commercial banks are permitted
to open branches in Tier 1 centers without permission of RBI, subject to the following conditions being
satisfied:

 at least 25% of the total number of branches opened during a financial year (excluding entitlement for
branches in Tier 1 centers given by way of incentive), must be opened in unbanked rural (Tier 5 and
Tier 6) centers, i.e., centers which do not have a brick and mortar structure of any scheduled
commercial bank for customer based banking transactions; and
 the total number of branches opened in Tier 1 centers during the financial year (excluding entitlement
for branches in Tier 1 centers given by way of incentive) cannot exceed the total number of branches
opened in Tier 2 to Tier 6 centers and all centers in the North Eastern States and Sikkim.

As on December 31, 2014, we had 157 branches in Tier 1 centers and 274 branches in Tier 2 to Tier 6 centers.
For details of key approvals obtained with respect to our top 25 branches, identified on the basis of total
business, see the section titled “Government and Other Approvals” on page 330. Our ability to raise fresh
deposits and grow our deposit base from Tier 1 centers depends in part on our ability to expand our network of
branches. Further, pursuant to a letter dated January 30, 2015 from RBI in relation to the broadening of capital
base and listing of the Equity Shares, the general permission to open new branches was withdrawn and our
Bank is not permitted to open any new branches without prior approval of RBI. There can be no assurance that
we will be able to (i) open new branches, (ii) continue to satisfy the eligibility criteria for branch expansion, (iii)
the restrictions imposed by RBI be revoked, (iv) RBI will give us approval for opening branches, or (v) RBI
will not impose similar restrictions on us in the future, as a result of which our business prospects could be
adversely affected.

36. Any closures of branches or losses of our key branch personnel may adversely affect our ability to build and
maintain relationships with our customers.

Our business is dependent on our key branch personnel to establish, build and maintain customer relationships.
We encourage dedicated branch personnel to service clients in certain business segments since we believe that
this leads to long-term client relationships, a trust-based business environment and over time, better cross-

31
 selling opportunities. While no individual branch manager and no single operating group of managers
contributes a meaningful percentage of our business, our business may suffer materially if a substantial number
of branch managers leave the organization or if some of our branches are closed for any reason beyond our
control.

37. Our risk management policies and procedures may not adequately address unidentified or unanticipated
risks.

We have devoted significant resources to developing our risk management policies and procedures and expect
to continue to do so in the future. We have policies and procedures in place to measure, manage and control the
various risks to which we are exposed including 1) Credit Risk Management policy 2) Operational Risk
Management policy 3) Outsourcing Policy and 4) Business Continuity Plan, that articulates our approach to the
identification, measurement, monitoring controlling and mitigation of various risks associated with our banking
operations in addition to providing certain important guidelines for strict adherence. Our other important risk
policies include our Liquidity Management Policy, Market Risk Management Policy which includes Asset-
Liability Management Policy, Credit Policy, Credit Risk Management Policy an Investment Policy, Forex
Policy, Recovery Policy, Stress Testing Policy, KYC and AML Policy, Operations Risk Management Policy,
Risk Based Internal Audit Policy, Internal Capital Adequacy Assessment Process Policy. The Risk Management
Committee of the Board and the Board review our risk management policies annually. Despite this, our policies
and procedures to identify, monitor and manage risks may not be fully effective. Some of our risk management
systems are not automated and are subject to human error. Some of our methods of managing risk are based
upon the use of observed historical market behavior. As a result, these methods may not accurately predict
future risk exposures which could be significantly greater than indicated by the historical measures. As we seek
to expand the scope of our operations, we also face the risk of inability to develop risk management policies and
procedures that are properly designed for those new business areas in a timely manner. Any inability to develop
and implement effective risk management policies may adversely affect our business, prospects, financial
condition and results of operations.

38. Our business is highly dependent on our information technology systems, which require significant
investment for regular maintenance, upgrades and improvements. Therefore, if we are unable to adapt to
rapid technological changes, or if there is any breach of our information technology systems or any failure
of such systems to perform as expected, our business, reputation and ability to service our customers could be
adversely affected.

Our information technology systems are a critical part of our business that help us manage, among other things,
our risk management, regulatory compliance, deposit servicing and loan origination functions, as well as our
increasing portfolio of products and services in all our business segments. In particular, the secure transmission
of confidential information is critical to our operations.

Any technical failures associated with our information technology systems or network infrastructure, including
those caused by power failures and breaches in security caused by computer viruses and other unauthorised
tampering, may cause interruptions or delays in our ability to provide services to our customers on a timely
basis or at all, and may also result in costs for information retrieval and verification. Corruption of certain
information could also lead to errors when we provide services to our customers. Any failure on the part of third
party vendors under agreements with us to provide products and services, including software that enables our
operations, or to appropriately maintain such products and services under annual maintenance contracts, may
adversely affect our functioning and operations. In the event of failure on the part of these third party vendors,
their liabilities towards us usually do not exceed a certain percentage of the total fee paid by us and they will not
be liable to us for any loss of profits or revenue or any consequential or indirect loss, which in turn exposes us
to higher risks in using these software and systems. In addition, we may be subject to liability as the result of
any theft or misuse of personal information stored on our systems or on the systems of our outsourcing service
providers. Any of these outcomes could adversely affect our business, our reputation and the quality of our
customer service.

Our networks and systems may be vulnerable to unauthorised access and other security problems. To address
these issues and to minimize the risk of security breaches, we employ security systems, including firewalls,

32
 security information and event management. Despite implementation of these systems, we cannot assure you
that our existing security measures will prevent unforeseeable security breaches, including break-ins and
viruses, or other disruptions such as those caused by defects in hardware or software and errors or misconduct
of operators. Persons who circumvent our security measures could use our clients’ confidential information
wrongfully or otherwise compromise the integrity of information stored in and transmitted through these
computer systems and networks. There can be no assurance that our use of encrypted password-based
protections and firewalls are adequate to prevent fraud or the invasion or breach of the network by an intruder.
Any material security breach or other disruptions could expose us to losses and regulatory actions and could
harm our reputation, and may adversely affect our operations and future financial performance.

The Bank has set up the disaster recovery site in Tata Communications IDC, White Field, Bangalore and a
specific disaster recovery facility for RTGS transactions in Chennai. The servers are hosted in a caged area with
biometric access. The complete datacenter is managed using BMS (Building Management System). Various
applications such as core banking solution, internet banking, foreign inward remittance, ATM switch are
deployed in disaster recovery site. However, any failure in our systems, particularly those utilized for our retail
products and services and transaction banking due to the occurrence of calamities such as floods, fire,
earthquakes and cyclones that affect areas in which we have data recovery sites, could adversely affect our
operations and the quality of our customer service.

We need to regularly upgrade and improve our information technology systems, including our software, back-
up systems and disaster recovery operations, at substantial cost so that we remain competitive. Our success will
also depend, in part, on our ability to respond to new technological advances and emerging banking and other
financial services industry standards and practices on a cost-effective and timely basis. The development and
implementation of such technology entails significant technical and business risks. The high cost to upgrade and
improve our information technology systems, whether to comply with changes in regulatory requirements, to
remain competitive or otherwise, could be prohibitive due to the relatively small size of our Bank. There can be
no assurance that we will successfully implement new technologies or adapt our transaction processing systems
to customer requirements or improving market standards. Any failure to improve or upgrade our information
technology systems effectively or in a timely manner could materially and adversely affect our competitiveness,
financial condition and results of operations.

39. We may not be able to detect money-laundering and other illegal or improper activities fully or on a timely
basis, which could expose us to additional liability and harm our business and/or our reputation.

We are required to comply with applicable anti-money-laundering (AML) and anti-terrorism laws and other
regulations in India. In the ordinary course of our banking operations, we run the risk of failing to comply with
the prescribed KYC procedures and the consequent risk of fraud and money laundering by dishonest customers
and assessment of penalties and/or imposition of sanctions against us for such compliance failures despite
having implemented systems and controls designed to prevent the occurrence of these risks.

RBI has, in the past, imposed penalties on us for, inter-alia, failure to adhere to the instructions/guidelines for
opening the accounts and maintaining necessary record of all cash deposits and withdrawals and violations
under KYC/AML norms. For details, please see section titled “Outstanding Litigation and Material
Developments – Past penalties imposed on our Bank” on page 325.

Although we believe that we have adequate internal policies, processes and controls in place to prevent and
detect any AML activity and ensure KYC compliance, there can be no assurance that we will be able to fully
control instances of any potential or attempted violation by other parties and may accordingly be subject to
regulatory actions including imposition of fines and other penalties by the relevant government agencies to
whom we report. Our business and reputation could suffer if any such parties use or attempt to use our Bank for
money-laundering or illegal or improper purposes and such attempts are not detected or reported to the
appropriate authorities in compliance with applicable legal requirements.

40. Any failure or material weakness of our internal control system or any material damages caused by
manifestation of any operational risks which we are subject to could adversely affect our reputation and
profitability.

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 Our management is responsible for establishing and maintaining adequate internal measures commensurate with
the size of our Bank and complexity of operations. Our Bank’s internal inspection/concurrent audit functions
are equipped to make an independent and objective evaluation of the adequacy and effectiveness of internal
controls on an ongoing basis to ensure that business units adhere to compliance requirements and internal
circular guidelines.

While we continue to periodically test and update, as necessary, our internal control systems, we are exposed to
operational risks arising from inadequacy or failure of internal processes or systems, and our actions may not be
sufficient to result in an effective internal control environment. Given our high volume of transactions, errors
may be repeated or compounded before they are discovered and rectified. Our management information systems
and internal control procedures that are designed to monitor our operations and overall compliance may not be
able to identify non-compliance and/or suspicious transactions in a timely manner or at all. Where internal
control weaknesses are identified, our actions may not be sufficient to fully correct such internal control
weakness. In addition, certain banking processes are carried out manually, which may increase the risk that
human error, tampering or manipulation will result in losses that may be difficult to detect. As a result, we may
suffer monetary losses.

In the ordinary course of our banking business as well, we experience numerous frauds which are committed
against our Bank, by either the employees of our Bank, our customers or third parties. While our Bank is
required to report each instance of frauds committed to the RBI in the prescribed format (Form FMR-1), we
also undertake internal investigations and departmental inquiries, as well as initiate legal action against the
responsible parties in certain cases. Despite such actions and insurance coverage, such frauds may not be
adequately covered by our insurance and the costs incurred to deal with such frauds and legal proceedings
initiated may be significant, thereby adversely affecting our profitability and results of operations. Such
instances may also adversely affect our reputation. For the six months ended December 31, 2014, we had total
identified fraud cases amounting to ` 673.21 million.

41. We are subject to various operational and other risks associated with the financial industry which, if
materialised, may have an adverse impact on our business.

The proper functioning of our financial control, risk management, accounting or other data collection and
processing systems, together with the communication networks connecting our various branches and offices is
critical to our operations and ability to compete effectively. We are exposed to many types of operational risk,
including fraud or other misconduct by employees, customers or outsiders involving our Bank, our products and
services, documentation, and operations. For instance, in the past, there have been numerous instances where
we have had to take disciplinary action against employees for various reasons, including misappropriation of
cash, unauthorised access to our customers’ accounts and authentication of fictitious and fraudulent
transactions; unauthorised transactions by employees and third parties (including violation of regulations for
prevention of corrupt practices and other regulations governing our business activities); unauthorised use of
debit cards at ATMs; misreporting or non-reporting with respect to statutory, legal or regulatory reporting and
disclosure obligations; any breach of network security; and operational errors, including clerical or record
keeping errors or errors resulting from faulty computer or telecommunications systems.

We cannot assure you that any of these events will not happen or we will be able to recover the funds misused
or misappropriated if such events occur. Further, we cannot assure you that any such incident will not have an
adverse effect on our reputation. In addition, we may also be exposed to different types of risk during our
operations, including but not limited to credit risk, counterparty risk, market risk, liquidity risk and operational
risk.

Further, we outsource certain functions such as, ATM site maintenance, data entering for account opening,
check processing and management of offsite ATMs, to other agencies and are exposed to the risk that external
vendors or service providers may be unable to fulfill their contractual obligations to us. We may also be subject
to the risk of fraud or operational errors by their respective employees and to the risk that its (or its vendors’)
business continuity and data security systems prove to be inadequate. Although we maintain a system of
controls designed to keep operational risk at appropriate levels, there can be no assurance that we will not suffer

34
 losses from operational risks in the future which can have an adverse effect on our business, results of
operations and financial condition.

42. We depend on the accuracy and completeness of information about customers and counterparties.

In deciding whether to extend credit or enter into other transactions with customers and counterparties, we may
rely on information furnished to us by or on behalf of such customers and counterparties, including financial
statements and other financial information and opinions on title deeds and valuation of property. We may also
rely on certain representations as to the accuracy and completeness of that information. With respect to financial
statements, we rely on reports of independent auditors of the borrowers. For instance, in deciding whether to
extend credit, we may assume that a customer’s audited financial statements conform to generally accepted
accounting principles and present fairly, in all material respects, the financial condition, results of operations
and cash flows of that customer. Our financial condition and results of operations could be negatively affected
by relying on financial statements of customers that do not comply with generally accepted accounting
principles or other information that is incorrect or materially misleading.

43. Our ability to pay dividends is restricted.

RBI has restricted us from declaring dividends for Fiscal 2015 without its prior permission. There can be no
assurance that such a restriction will not be imposed on us again. Our ability to pay dividends also depends on
our future earnings, financial condition, cash flows, working capital requirements, capital expenditures and
restrictive covenants in our financing arrangements.

There are regulatory restrictions on banks with respect to payment of dividend as well. For instance, under the
Banking Regulation Act, subject to certain exceptions, we cannot pay any dividend on the Equity Shares until
all our capitalised expenses have been completely written off. Payment of dividend is further governed by the
RBI guidelines. As per RBI guidelines, maximum dividend payout is linked to a matrix of Net NPA percentage
and level of CRAR. Further, new Basel III guidelines impose additional restrictions on dividend payout.
Dividends distributed by us will attract dividend distribution tax at rates applicable from time to time. We
cannot assure you that we will generate sufficient income to cover our operating expenses and pay dividends to
our shareholders. Our ability to pay dividends could also be restricted under certain financing arrangements that
we may enter into in the future.

If we were to raise Tier II capital in the future, the payment of any dividends would be after payment of interest
on such capital. In addition, dividends that we have paid in the past may not be reflective of the dividends that
we may pay in a future period. The amount of our future dividend payments, if any, will depend upon our future
earnings, financial condition, cash flows, working capital requirements, terms and conditions of our
indebtedness, capital expenditures and regulation. There can be no assurance that we will be able to pay
dividends.

44. New product and services offered by us may not be successful and we may not grow in any new business area
which may have a material adverse effect on our business, financial condition or results of operation.

We may introduce new products and services to explore new business opportunities. We cannot assure you that
all our new products and services will gain customer acceptance and this may result in our incurring
preoperative expenses and launch costs without any assurance that such products will be successful or may fail
market penetration. Further, our inability to grow in any new business areas could adversely affect our business
and financial performance.

45. We maintain Nostro accounts with correspondent banks in respective countries for facilitating our foreign
exchange operations. In the event that we are unable to open new accounts or continue to maintain existing
accounts, for any reason whatsoever, our business, results of operations and financial condition could be
adversely affected.

We maintain Nostro accounts in foreign currencies with correspondent foreign banks for facilitating our
treasury, trade and remittance transactions. Such accounts facilitate inward and outward remittance, whereby

35
 our customers can remit funds to India in any of the currencies for which we have opened such accounts, by
instructing their banks to remit the funds to our Nostro account maintained in that particular currency. In case
we intend to cater to a different foreign location or currency, we may need to open such Nostro accounts with
the correspondent banks in those locations. Opening and maintaining such accounts requires compliance with
strict KYC norms and any failure to adhere to such norms may result in the correspondent bank closing these
accounts. Further, a correspondent bank may discontinue any of the services that it offers in relation to such
accounts which may result in customer dissatisfaction.

In the event the correspondent bank fails to maintain or closes these accounts, including due to reasons beyond
our control, our business, results of operations and financial condition could be adversely affected.

46. Our Directors may be interested in other companies or entities, as directors or otherwise, which are in the
same line of business as our Bank.

Certain of our Directors maybe interested in other companies or entities, as directors or otherwise, which are
engaged in a similar line of business to ours. For more details regarding other directorships of our Directors, see
section titled “Our Management” on page 172. We cannot assure you that our Directors will not favour the
interests of other companies and entities they are interested in, over our interests and whether all future conflict
of interest situations will be adequately addressed.

47. Our insurance coverage could prove inadequate to satisfy potential claims. If we were to incur a serious
uninsured loss or a loss that significantly exceeds the limits of our insurance policies, it could have a
material adverse effect on our business, results of operations and financial condition.

We currently have insurance coverage over our head office, branches and other offices. We have a special
contingency policy which covers properties that are lost or damaged by contingencies. We also have standard
fire and special perils policy and lift insurance policy for our head office. Additionally, we have standard fire
and special perils policy, public liability (non-industrial risks) insurance policy, banker’s indemnity policy and
burglary insurance policy which provide coverage to all our branches and offices across the country. Further,
we also have an insurance cover for director’s and officer’s liability. While we believe that our insurance
coverage is consistent with industry practice in India to cover risks associated with our business, we cannot
assure you that our current insurance policies will insure us fully against all risks and losses that may arise in
the future. In addition, even if such losses are insured, we may be required to pay a significant deductible on
any claim for recovery of such a loss, or the amount of the loss may exceed our coverage for the loss. In
addition, our insurance policies are subject to annual review, and we cannot assure you that we will be able to
renew these policies on similar or otherwise acceptable terms, if at all. If we were to incur a serious uninsured
loss or a loss that significantly exceed the limits of our insurance policies, it could have a material adverse effect
on our business and financial condition.

In addition, we cannot be certain that the coverage will be available in sufficient amounts to cover one or more
large claims. There have been instances in the past where we have not been able to recover claims from
insurance companies towards our monetary claims. We cannot be certain that such rejections of our insurance
claims in full or in part, will not be repeated in future and which may have a material adverse effect to our
business.

48. We may seek growth opportunities through acquisitions or be required to undertake mergers on the
recommendation of the RBI, which exposes us to integration and other acquisition risks.

In 1964 and 1965, our Bank took over the assets and liabilities of six small and medium sized banks located in
Kerala. We may seek growth opportunities through acquisitions or be required to undertake mergers
recommended by RBI. In the past, RBI has ordered mergers of weak banks with other banks primarily in the
interest of depositors of the weak banks.

Any future acquisition or merger is subject to risks and uncertainties, some of which are beyond our control,
including:

36
  difficulties in operating the integrated information technology system, electronic banking system, risk
management and other systems;
 challenges in harmonising the two or more corporate cultures;
 difficulties in maintaining asset quality;
 difficulties in leveraging synergies and rationalising operations;
 difficulties in retaining and attracting customers and employees;
 difficulties in developing new skills required for new business and markets; and
 diversion of management’s attention required to integrate the two businesses following the acquisition
or merger, one or more of which could have an adverse effect on our business.

In addition to the above risks, we cannot assure you that such merger will be in our interest or will positively
impact our growth and performance. Any negative impact of a merger can adversely affect our business, results
of operation and financial condition.

We cannot assure you that RBI will not recommend to us to undertake mergers in the future, which may have
an adverse effect on our business and financial condition.

Further, the Government has expressed a preference for consolidation in the banking sector in India. Mergers
among public sector banks may result in enhanced competitive strengths in pricing and delivery channels for
merged entities. If there is liberalisation of the rules for foreign investment in private sector banks, this could
result in consolidation in the banking sector. Our Bank may face greater competition from larger banks as a
result of such consolidation, which may adversely affect our Bank’s future financial performance.

49. Third party industry and statistical data in this Draft Red Herring Prospectus may be incomplete or
unreliable.

Statistical and industry data used in this Draft Red Herring Prospectus has been obtained from various
government and industry publications. We have not independently verified data obtained from official and
industry publications and other sources referred to in this Draft Red Herring Prospectus and therefore, while we
believe them to be true, we cannot assure you that they are complete or reliable. Such data may also be
produced on different bases from those used in the industry publications we have referenced. Therefore,
discussions of matters relating to India, its economy and the industries in which we currently operate are subject
to the caveat that the statistical and other data upon which such discussions are based may be incomplete or
unreliable. See the section titled “Industry Overview” on page 104.

50. The objects of the Issue for which the funds are being raised have not been appraised by any bank or
financial institutions. Further, the deployment of the Net Proceeds is at the discretion of our Bank and is not
subject to monitoring by any independent agency.

The objects of the Issue have not been appraised by any bank or financial institution. As we are a bank, in
accordance with Regulation 16 of the SEBI Regulations, there is no requirement for appointment of a
monitoring agency. Hence, deployment of Net Proceeds will be at the discretion of our Bank is not subject to
any monitoring by any independent agency. We cannot assure you that we will be able to monitor the
deployment of the Net Proceeds in the manner similar to that of the monitoring agency.

51. Our Bank may face cyber threats attempting to exploit its network to disrupt services to customers and/or
theft of sensitive internal Bank data or customer information. This may cause damage to its reputation and
adversely impact our business and financial results.

Our Bank offers internet banking services to its customers. Its internet banking channel includes multiple
services such as electronic funds transfer, bill payment services, mobile recharge, online generation of account
statements, balance enquiry, cheque book request, online credit card payments and other utility payments. Our
Bank is therefore exposed to various cyber threats including (i) phishing and trojans targeting our customers,
wherein fraudsters send unsolicited mails to our customers seeking account sensitive information or to infect
customer machines to search and attempt exfiltration of account sensitive information; and (ii) hacking, wherein

37
 attackers seek to hack into our website with the primary intention of causing reputational damage to it by
disrupting services; and (iii) data theft, wherein cyber criminals may attempt to enter our Bank’s network with
the intention of stealing its data or information. In addition, we also faces the risk of our customers incorrectly
blaming us and terminating their accounts with us for any cyber security breaches that may have occurred on
their own system or with that of an unrelated third party. Any cyber security breach could also subject us to
additional regulatory scrutiny and expose it to civil litigation and related financial liability.

EXTERNAL RISK FACTORS

Risks Relating to the Indian Banking Industry

52. Banking is a heavily regulated industry and material changes in the regulations which govern us could
cause our business to suffer.

Banks in India are subject to detailed supervision and regulation by the RBI. In addition, banks are generally
subject to changes in Indian law, as well as to changes in regulation and government policies and accounting
principles. Since 2005, the RBI has made several changes in regulations applicable to banking companies,
including:

 risk-weights on certain categories of loans for computation of capital adequacy;

 general provisioning requirements for various categories of assets;
 capital requirements and accounting norms for securitisation;
 policy interest rates, cash reserve ratio, cessation of payment of interest on cash reserve balances;
 investment in technology up-gradation and information security;
 limits on investments in financial sector enterprises and venture capital funds; and
 directed lending requirements.

The Banking Regulation Act imposes a number of restrictions, which affect our operating flexibility and
investors’ rights, including:

 restrictions on payment of dividend;

 No shareholder of our Bank can exercise voting rights on poll in excess of 10% of the total voting
rights of all of our shareholders.
 Section 12B of the Banking Regulation Act requires any person to seek prior approval of the RBI to
acquire or agree to acquire shares or voting rights of a bank, either directly or indirectly, by himself or
acting in concert with other persons, wherein such acquisition (taken together with shares or voting
rights held by him or his relative or associate enterprise or persons acting in concert with him) results
in the aggregate shareholding of such persons to be 5% or more of the paid-up share capital of a bank
or entitles him to exercise 5% or more of the voting rights in a bank. Such approval may be granted
by the RBI if it is satisfied that the applicant meets certain fitness and propriety tests. The RBI may
require the proposed acquirer to seek further RBI approval for subsequent acquisitions. Further, the
RBI may, by passing an order, restrict any person holding more than 5% of the total voting rights of
the bank from exercising voting rights in excess of 5%, if such person is deemed to be not fit and
proper by the RBI;
 We are subject to restrictions relating to incorporation of subsidiaries, which may prevent us from
exploiting emerging business opportunities in areas other than banking. We may not open new places
of business and transfer our existing places of business, which may hamper our operational flexibility.
Further, RBI has issued detailed guidelines on investment in subsidiaries and other companies,
including:

- equity investment by a bank in a non-financial service company would be subject to a limit of

10% of the company’s paid-up capital or 10% of the bank’s paid-up capital and reserves,
whichever is less;
- equity investments in any non-financial services company held by a bank; its subsidiaries,
associates or joint ventures or entities directly or indirectly controlled by the bank; and bank

38
 managed mutual funds should in aggregate, not exceed 20% of the investee company’s paid-up
capital.
- a bank’s equity investments in subsidiaries and other entities that are engaged in financial
service activities together with equity investments in entities engaged in non financial service
activities shall not exceed 20% of the bank’s paid-up share capital and reserves.

 Our ability to build overseas asset portfolios and exploit business opportunities overseas is limited by
the requirement to maintain assets in India of at least 75% of our demand and time liabilities in India.
 Our ability to produce documents and records for inspection is regulated.
 The RBI is empowered to direct and generally advise us and may prohibit us from entering into
certain transactions and agreements.
 We are required to obtain prior approval of RBI before we appoint our Chairman, Managing Director
and CEO and any other full-time Directors and fix their remuneration. The RBI has powers to remove
managerial and other persons from office, and to appoint additional directors. We are also required to
obtain approval of the RBI for the creation of floating charges for our borrowings, thereby hampering
leverage.

Any changes in the regulatory environment, under which we operate, or our inability to comply with the
regulations, could adversely affect our business, reputation, results of operations and financial condition.

53. The growth rate of India’s banking industry may not be sustainable.

We expect the banking industry in India to continue to grow as a result of anticipated growth in India’s
economy, increases in household income, further social welfare reforms and demographic changes. However, it
is not clear how certain trends and events, such as the pace of India’s economic growth, the development of
domestic capital and insurance markets and the ongoing reform will affect India’s banking industry. In addition,
there can be no assurance that the banking industry in India is free from systemic risks. Consequently, there can
be no assurance that the growth and development of India’s banking industry will be sustainable.

54. We are exposed to fluctuations in foreign exchange rates, international gold prices, and global interest rates.

As a financial intermediary, we are exposed to exchange rate risk. We comply with regulatory limits on our
unhedged foreign currency exposure. However, we are exposed to fluctuations in foreign currency rates for our
unhedged exposure adverse movements in foreign exchange rates may impact our borrowers negatively which
may in turn impact the quality of our exposure to these borrowers. Volatility in foreign exchange rates could
adversely affect our future financial performance. Furthermore, changes in interest rates in other countries could
place pressure on the Indian rupee, reduce market liquidity or result in regulators deploying unconventional or
extraordinary financial measures, any of which could adversely affect our Bank’s performance. Due to our high
proportion of loans against gold jewellery we are vulnerable to heightened volatility in international gold prices
and changes in government policy on import of gold.

55. Financial difficulties and other problems in certain financial institutions in India could adversely affect our
business.

As an Indian bank, we are exposed to the risks of the Indian financial system which may be affected by the
financial difficulties faced by certain Indian financial institutions because the commercial soundness of many
financial institutions may be closely related as a result of credit, trading, clearing or other relationships. This
risk, which is sometimes referred to as “systemic risk”, may adversely affect financial intermediaries, such as
clearing agencies, banks, securities firms and exchanges with whom we interact on a daily basis and who may
default on their obligations due to bankruptcy, lack of liquidity, operational failure or other reasons. Any such
difficulties or instability of the Indian financial system in general could create an adverse market perception
about Indian financial institutions and banks and hence adversely affect our business. As the Indian financial
system operates within an emerging market, it faces risks of a nature and extent not typically faced in more
developed economies, including the risk of deposit runs notwithstanding the existence of a national deposit
insurance scheme.

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56. The Government of India (“GoI”) has in the past and may in the future direct us to implement certain
schemes that are aimed at serving the interest of farmers and/or a cross section of the public. Such schemes
may not necessarily be aimed at maximizing our profits and may adversely affect our business, financial
condition and results of operations.

In Fiscal 2009, the GoI implemented the “Agricultural Debt Waiver and Debt Relief Scheme 2008” under
which agricultural loans (including principal and interest) amounting to ` 27.92 million were waived off. In
future, the GoI may further require banks to waive off or reduce the outstanding amount due on loans provided
to customers in certain sectors, in particular the agricultural sector, to serve the larger interests of India which
could adversely affect our business and financial condition.

We also provide special schemes under which credit facilities and loans are extended to persons belonging to
weaker sections, which is aimed at facilitating the GoI‘s initiative to empower them. Such schemes and credit
facilities provided to members of the weaker sections may not be as profitable as compared to lending in the
non-priority sector. This is because historically, NPAs are higher in the priority sector lending compared with
non-priority sector lending. This adversely affects our profitability and financial condition.

Risks Relating to India

57. Conditions in the Indian securities market may affect the price or liquidity of the Equity Shares.

The Indian securities markets are smaller and may be more volatile than securities markets in more developed
economies. The regulation and monitoring of Indian securities markets and the activities of investors, brokers
and other participants differ, in some cases significantly, from those in the U.S. and Europe. Indian stock
exchanges have in the past experienced substantial fluctuations in the prices of listed securities.

Indian stock exchanges have, in the past, experienced problems that have affected the market price and liquidity
of the securities of Indian companies, such as temporary exchange closures, broker defaults, settlement delays
and strikes by brokers. In addition, the governing bodies of the Indian stock exchanges have from time to time
restricted securities from trading, limited price movements and increased margin requirements. Further, disputes
have occurred on occasion between listed companies and the Indian stock exchanges and other regulatory
bodies that, in some cases, have had a negative effect on market sentiment. If similar problems occur in the
future, the market price and liquidity of the Equity Shares could be adversely affected. A closure of, or trading
stoppage on, either the BSE or the NSE could adversely affect the trading price of the Equity Shares.

58. There may be differences in corporate information available in the Indian securities markets than securities
markets in developed countries.

There may be differences between the level of regulation, disclosure and monitoring of the Indian securities
markets and the activities of investors, brokers and other participants and that of the markets in the United
States and other developed countries. SEBI is responsible for approving and improving disclosure and other
regulatory standards for the Indian securities markets. SEBI has issued regulations and guidelines on disclosure
requirements, insider trading and other matters. There may, however, be less publicly available information
about Indian companies than is regularly made available by public companies in developed countries. As a
result, the prospective investors may have access to less information about the business, results of operations
and financial conditions and those of the peers listed on the Stock Exchanges on an ongoing basis as compared
to companies subject to reporting requirements of other more developed countries.

59. A slowdown in economic growth in India could cause our business to suffer.

A slowdown in the Indian economy could adversely affect our business and our borrowers, depositors and
contractual counterparties, especially if such a slowdown were to be continued and prolonged. Further, in
periods of high rates of inflation, our costs, such as operating expenses, may increase, which could have an
adverse effect on our results of operations. Inflation may also have a bearing on the overall interest rates, which
may adversely affect our net interest income.

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 Further, in light of the increasing linkage of the Indian economy to other economies, the Indian economy will be
increasingly influenced by economic and market conditions in other countries. As a result, a recession in the
United States of America and other countries in the developed world and a slowdown in economic growth in
major emerging markets like China could have an adverse impact on economic growth in India.

A slowdown in the pace of growth in the Indian economy could result in lower demand for our services, which
could adversely impact our business, our financial performance, our ability to implement our strategy.

60. Investing in securities that carry emerging market risks can be affected generally by volatility in the
emerging markets.

The markets for securities bearing emerging market risks, such as risks relating to India, are, to varying degrees,
influenced by economic and securities market conditions in other emerging market countries. Although
economic conditions differ in each country, investors’ reactions to developments in one country may affect
securities of issuers in other countries, including India. Accordingly, the price and liquidity of our Equity Shares
may be subject to significant fluctuations, which may not necessarily be directly or indirectly related to our
financial performance.

61. Companies operating in India are subject to a variety of central and state government taxes and surcharges.

Tax and other levies imposed by the central and state governments in India that affect our tax liability include
central and state taxes and other levies, income tax, value added tax, turnover tax, service tax, stamp duty and
other special taxes and surcharges which are introduced on a temporary or permanent basis from time to time.
Moreover, the central and state tax scheme in India is extensive and subject to change from time to time. For
example, a new direct tax code is expected to be introduced by the Indian Parliament. In addition, a new goods
and services tax regime is expected to be introduced in the near future, and the scope of the service tax is
proposed to be enlarged. Further, the provisions in relation to the GAAR have been introduced in the Finance
Act, 2012 to come into effect from the assessment year beginning from April 1, 2017. The GAAR provisions
intend to catch arrangements declared as “impermissible avoidance arrangements”, which is any arrangement,
the main purpose or one of the main purposes of which is to obtain a tax benefit and which satisfy at least one
of the following tests: (i) creates rights, or obligations, which are not ordinarily created between persons dealing
at arm’s length; (ii) results, directly or indirectly, in misuse, or abuse, of the provisions of the Income Tax Act,
1961; (iii) lacks commercial substance or is deemed to lack commercial substance, in whole or in part; or (iv) is
entered into, or carried out, by means, or in a manner, which are not ordinarily employed for bona fide
purposes. If GAAR provisions are invoked, then the tax authorities have wide powers, including denial of tax
benefit or a benefit under a tax treaty. The statutory corporate income tax in India, which includes a surcharge
on the tax and an education cess on the tax and the surcharge, is currently 33.99%. The central or state
government may in the future further increase the corporate income tax it imposes. Any such future increases or
amendments may affect the overall tax efficiency of companies operating in India and may result in significant
additional taxes becoming payable. Additional tax exposure could adversely affect our business and results of
operations.

62. A significant change in the Government’s economic liberalization and deregulation policies could adversely
affect our business.

Our business and customers are predominantly located in India or are related to and influenced by the Indian
economy. The Indian government has traditionally exercised, and continues to exercise, a dominant influence
over many aspects of the economy. Government policies could adversely affect business and economic
conditions in India, our ability to implement our strategy and our future financial performance. Since 1991,
successive Indian governments have pursued policies of economic liberalization, including significantly
relaxing restrictions on the private sector and encouraging the development of the Indian financial sector. For
the past several years, coalition governments have governed India. It is difficult to predict the economic policies
that will be pursued by the Government of India. The rate of economic liberalization could change and specific
laws and policies affecting banking and finance companies, foreign investment, currency exchange and other
matters affecting investment in our securities could change as well. For instance, if the Government or any state
government were to enact legislation or policies requiring the waiver or restructuring of loans to specific

41
 persons or industries, such waived and/or restructured loans could have an adverse impact on the financial
condition and performance of our Bank; moreover, such legislation and policies may also cause a significant
behavioral change in the future with respect to borrowers in such industries or otherwise. Any significant
change in India’s economic liberalization and deregulation policies could adversely affect business and
economic conditions in India generally and our business in particular.

63. Communal disturbances, riots, terrorist attacks and other acts of violence or war involving India, the or
other countries could adversely affect the financial markets, result in loss of client confidence, and adversely
affect our business, financial condition and results of operations.

India has experienced communal disturbances, terrorist attacks and riots during recent years. Any major
hostilities involving India or other acts of violence, including civil unrest or similar events that are beyond our
control, could have a material adverse effect on India’s economy and our business and may adversely affect the
Indian stock markets where our Equity Shares will trade as well as the global equity markets generally. Such
acts could negatively impact business sentiment as well as trade between countries, which could adversely
affect our Bank’s business and profitability.

Also, India or other countries may enter into armed conflict or war with other countries or extend pre-existing
hostilities. West and South Asia has, from time to time, experienced instances of civil unrest and hostilities
among neighboring countries. Military activity or terrorist attacks could adversely affect the Indian economy
by, for example, disrupting communications and making travel more difficult. Such events could also create a
perception that investments in Indian companies involve a higher degree of risk. This, in turn, could adversely
affect client confidence in India, which could have an adverse impact on the economies of India and other
countries, on the markets for our products and services and on our business. Additionally, such events could
have a material adverse effect on the market for securities of Indian companies, including the Equity Shares.

64. Trade deficits could adversely affect our business and the price of our Equity Shares.

India’s trade relationships with other countries and its trade deficit may adversely affect Indian economic
conditions. In Fiscal 2014, India experienced a trade deficit of US$138.59 billion, as announced by the Ministry
of Commerce and Industry in its Annual Supplement 2013-14 to the Foreign Trade Policy 2009-14 and trade
deficit for April-February, 2014-15 was estimated at US $ 125,220.94 million which was higher than the deficit
of US $ 124,844.53 million during April-February, 2013-14. If trade deficits were to increase or become no
longer manageable, the Indian economy, and therefore our business, our financial performance and our
stockholders’ equity could be adversely affected.

65. A decline in India’s foreign exchange reserves may affect liquidity and interest rates in the Indian economy,
which could adversely impact us.

The direct adverse impact of the global financial crisis on India has seen the reversal of capital inflows and
decline in exports, leading to pressures on the balance of payments and a sharp depreciation of the Indian Rupee
vis-à-vis the US Dollar. Any increased intervention by the RBI in the foreign exchange market to control the
volatility of the exchange rate may result in a decline in India’s foreign exchange reserves and reduced liquidity
and higher interest rates in the Indian economy, which could adversely affect the Indian economy, our business,
our financial performance.

66. Any downgrading of India’s debt rating by an international rating agency could adversely affect our
business and the price of our Equity Shares.

Any adverse revisions to India’s credit ratings for domestic and international debt by international rating
agencies may adversely impact our business and limit our access to capital markets, increase the cost of funds,
adversely impact our liquidity position, our shareholders’ funds and the price of our Equity Shares.

67. Our ability to raise foreign capital may be constrained by Indian law, which may adversely affect our
business, financial condition, cash flows and results of operations.

42
 As an Indian company, we are subject to exchange controls that regulate borrowing in foreign currencies. Such
regulatory restrictions limit our financing sources and hence could constrain our ability to obtain financing on
competitive terms. In addition, we cannot assure you that the required approvals will be granted to us without
onerous conditions, if at all. Limitations on raising foreign debt may have an adverse effect on our business,
financial condition, cash flows and results of operations.

68. Investors in the Equity Shares may not be able to enforce a judgment of a foreign court against our Bank, its
directors or executive officers.

Investors in the Equity Shares may not be able to enforce a judgment of a foreign court against our Bank, its
directors or executive officers.

Our Bank is a limited liability company incorporated under the laws of India. Substantially all of our Bank’s
Directors and executive officers and key managerial personnel are residents of India and a substantial portion of
the assets of our Bank and such persons are located in India. As a result, it may not be possible for investors to
effect service of process upon our Bank or such persons outside India, or to enforce judgments obtained against
such parties in courts outside of India.

Recognition and enforcement of foreign judgments are provided for under Section 13 and Section 44A of the
Civil Procedure Code on a statutory basis. Section 13 of the Civil Procedure Code provides that foreign
judgments shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or
between parties under whom they or any of them claim litigating under the same title except: (a) where it has
not been pronounced by a court of competent jurisdiction; (b) where it has not been given on the merits of the
case; (c) where it appears on the face of the proceedings to be founded on an incorrect view of international law
or a refusal to recognise the law of India in cases in which such law is applicable; (d) where the proceedings in
which the judgment was obtained are opposed to natural justice; (e) where it has been obtained by fraud; and (f)
where it sustains a claim founded on a breach of any law in force in India.

Under the Civil Procedure Code, a court in India shall presume, upon the production of any document
purporting to be a certified copy of a foreign judgment, that such judgment was pronounced by a court of
competent jurisdiction, unless the contrary appears on the record; but such presumption may be displaced by
proving want of jurisdiction.

India is not a party to any international treaty in relation to the recognition or enforcement of foreign judgments.
However, Section 44A of the Civil Procedure Code provides that where a foreign judgment has been rendered
by a superior court, within the meaning of that Section, in any country or territory outside India which the
Government has by notification declared to be a reciprocating territory, it may be enforced in India by
proceedings in execution as if the judgment had been rendered by the relevant court in India. However, Section
44A of the Civil Procedure Code is applicable only to monetary decrees not being in the nature of any amounts
payable in respect of taxes or other charges of a like nature or in respect of a fine or other penalty and does not
include arbitration awards.

The United Kingdom, Singapore and Hong Kong, amongst others have been declared by the Government of
India to be “reciprocating territories” for the purposes of Section 44A of the Civil Procedure Code. A judgment
of a court of a country which is not a reciprocating territory may be enforced only by a fresh suit resulting in a
judgment or order and not by proceedings in execution. Such a suit has to be filed in India within three years
from the date of the judgment in the same manner as any other suit filed to enforce a civil liability in India. A
judgment of a superior court of a country which is a reciprocating territory may be enforced by proceedings in
execution, and a judgment not of a superior court, by a fresh suit resulting in a judgment or order. The latter suit
has to be filed in India within three years from the date of the judgment in the same manner as any other suit
filed to enforce a civil liability in India. Execution of a judgment or repatriation outside India of any amounts
received is subject to the approval of the RBI, wherever required. It is unlikely that a court in India would award
damages on the same basis as a foreign court if an action were to be brought in India. Furthermore, it is unlikely
that an Indian court would enforce foreign judgments if that court was of the view that the amount of damages
awarded was excessive or inconsistent with public policy, and is uncertain whether an Indian court would
enforce foreign judgments that would contravene or violate Indian law.

43
69. The Companies Act, 2013 has effected significant changes to the existing Indian company law framework,
which may subject us to higher compliance requirements and increase our compliance costs.

A majority of the provisions and rules under the Companies Act, 2013 have been notified and have come into
effect from the date of their respective notifications, resulting in the corresponding provisions of the Companies
Act, 1956 ceasing to have effect. The Companies Act, 2013 has brought into effect significant changes to the
Indian company law framework, such as in the provisions related to issue of capital, disclosures, corporate
governance norms, audit matters, and related party transactions. Further, the Companies Act, 2013 has also
introduced additional requirements which do not have corresponding equivalents under the Companies Act,
1956, including the introduction of a provision allowing the initiation of class action suits in India against
companies by shareholders or depositors, a restriction on investment by an Indian company through more than
two layers of subsidiary investment companies (subject to certain permitted exceptions), and prohibitions on
advances to directors. Companies are also required to spend 2.0% of our average net profits during three
immediately preceding financial years on corporate social responsibility activities. Further, the Companies Act,
2013 imposes greater monetary and other liability on our Bank, Directors and officers in default, for any non-
compliance. To ensure compliance with the requirements of the Companies Act, 2013, we may need to allocate
additional resources, which may increase our regulatory compliance costs and divert management attention.

We may face challenges in anticipating the changes required by, interpreting and complying with such
provisions due to limited jurisprudence on them. In the event, our interpretation of such provisions of the
Companies Act, 2013 differs from, or contradicts with, any judicial pronouncements or clarifications issued by
the Government in the future, we may face regulatory actions or we may be required to undertake remedial
steps. Additionally, some of the provisions of the Companies Act, 2013 overlap with other existing laws and
regulations (such as the corporate governance norms and insider trading regulations). We may face difficulties
in complying with any such overlapping requirements. Further, we cannot currently determine the impact of
provisions of the Companies Act, 2013 which are yet to come in force. Any increase in our compliance
requirements or in our compliance costs may have an adverse effect on our business and results of operations.

Further, there is no assurance that the Government will not in the future introduce new laws or regulations
(other than the Companies Act, 2013) or amend or change existing laws or regulations in a manner that
materially and adversely impacts our business operations and costs of doing business.

70. Our business and activities may be further regulated by the Competition Act and any adverse application or
interpretation of the Competition Act could materially and adversely affect our business, financial condition
and results of operations

The Competition Act seeks to prevent business practices that have or are likely to have an appreciable adverse
effect on competition in India and has established the CCI. Under the Competition Act, any arrangement,
understanding or action, whether formal or informal, which has or is likely to have an appreciable adverse effect
on competition is void and attracts substantial penalties. Any agreement among competitors which, directly or
indirectly determines purchase or sale prices; directly or indirectly results in bid rigging or collusive bidding,
limits or controls the production, supply or distribution of goods and services; or shares the market or source of
production or providing of services by way of allocation of geographical area or type of goods or services or
number of customers in the relevant market or in any other similar way, is presumed to have an appreciable
adverse effect on competition and shall be void. Further, the Competition Act prohibits the abuse of a dominant
position by any enterprise. If it is proven that a breach of the Competition Act committed by a company took
place with the consent or connivance or is attributable to any neglect on the part of, any director, manager,
secretary or other officer of such company, that person shall be guilty of the breach themselves and may be
punished as an individual. If we, or any of our employees, are penalized under the Competition Act, our
business may be adversely affected. On March 4, 2011, the Government of India notified and brought into force
new provisions under the Competition Act in relation to combined entities (the “Combination Regulation
Provisions”), which came into effect from June 1, 2011. The Combination Regulation Provisions require that
any acquisition of shares, voting rights, assets or control or mergers or amalgamations, which cross the
prescribed asset and turnover based thresholds, must be notified to and pre-approved by the CCI. In addition, on
May 11, 2011, the CCI issued the final Competition Commission of India (Procedure in regard to the

44
 transaction of business relating to combinations) Regulations, 2011 (which were further amended on March 28,
2014). These regulations, as amended, set out the mechanism for the implementation of the Combination
Regulation Provisions under the Competition Act.

It is difficult to predict the impact of the Competition Act on our growth and expansion strategies in the future.
If we are affected, directly or indirectly, by the application or interpretation of any provision of the Competition
Act or any enforcement proceedings initiated by the CCI or any adverse publicity that may be generated due to
scrutiny or prosecution by the CCI, it may adversely affect our business, financial condition and results of
operations.

71. Health epidemics and natural calamities in Asia or elsewhere could adversely affect the Indian economy or
our business and the price of our Equity Shares.

Since 2003, there have been outbreaks of Severe Acute Respiratory Syndrome in Asia, the outbreak of avian
influenza across Asia and Europe, the outbreak of the Ebola virus in western Africa, and the outbreak of
Influenza A (H1N1), SARS and other infectious diseases across the world had adversely affected a number of
countries and companies. Any future outbreak of infectious diseases or other serious public health epidemics
may have a negative impact on the economies, financial markets and level of business activity in affected areas,
which may, in turn, adversely affect our Bank’s business. India has also experienced natural calamities such as
earthquakes, floods, drought and a tsunami in the recent past. The extent and severity of these natural disasters
determine their impact on the Indian economy. Prolonged spells of abnormal rainfall and other natural
calamities could have an adverse impact on the Indian economy. Any future outbreak of infectious disease
among humans and/or animals or any other serious public health concerns or the occurrence of any natural
calamities could materially and adversely affect our business, prospects, financial condition and results of
operations, and the price of our Equity Shares.

72. Political instability or changes in the government in India or in the governments of the states where we
operate could cause us significant adverse effects.

Our Bank is incorporated in India and currently derives all of its revenues from operations in India and all of
our assets are located in India. Consequently, our performance, market price and liquidity of our Equity Shares
may be affected by changes in control, government policies, taxation, social and ethnic instability, social/civil
unrest and other political and economic developments affecting India. Our business is also impacted by
regulations and conditions in the various states in India where we operate. The Government of India has
traditionally exercised, and continues to exercise, a significant influence over many aspects of the economy.
The current government has announced that its general intention is to continue India’s current economic and
financial sector liberalization and deregulation policies. However, there can be no assurance that such policies
will be continued, and a significant change in the government’s policies could affect business and economic
conditions in India, and could also adversely affect our financial condition and results of operations. Any
political instability could affect specific laws and policies affecting foreign investment. A significant change in
the government’s policies, in particular, those relating to the banking sector in India, could adversely affect our
business, results of operations and financial condition.

Risks Relating to our Equity Shares and the Issue

73. We may decide not to proceed with the Issue at any time before Allotment. If we decide not to proceed with
the Issue after the Bid Opening Date but before Allotment, the refund of application amounts deposited will
be subject to us complying with our obligations under applicable laws.

We reserve the right not to proceed with the Issue at any time before the Allotment. If we withdraw the Issue
after the Bid Opening Date, we will be required to refund all Application amounts deposited within the
prescribed time. We shall be required to pay interest, as specified under SEBI Regulations or the Companies
Act, 2013, on the application amounts received if refund orders are not dispatched within the stipulated time
from the Bid Closing Date. Notwithstanding the foregoing, the Issue is also subject to obtaining (i) the final
listing and trading approvals of the Stock Exchanges, which our Bank shall apply for after Allotment and
(ii) the final RoC approval.

45
74. We may be required to raise additional capital in the future by further equity issuances, which will lead to
dilution of equity and may affect holdings of our shareholders, the market price of our Equity Shares, or the
incurrence of debt in order to satisfy our capital needs, which we may not be able to procure on acceptable
terms, or at all.

Our growth is dependent on having a strong balance sheet to support our activities. In addition to the Net
Proceeds and our internally generated cash flows, we may need other sources of financing to meet our capital
needs, which may include entering into new debt facilities with lending institutions or raising additional equity
in the capital markets. We may need to raise additional capital from time to time, dependent on business
conditions. The factors that would require us to raise additional capital could be business growth beyond what
the current balance sheet can sustain, additional capital requirements imposed due to changes in regulatory
regime or a significant depletion in our existing capital base due to unusual operating losses. Future issuances of
our equity shares or convertible securities may not be done on terms and conditions that are favorable to the
then existing shareholders of our Bank. Any such issuance could also dilute existing holders and adversely
affect the market price of our Equity Shares and our ability to raise capital through additional issues of
securities. In addition, any perception by investors that such issuances might occur could also affect the trading
price of our Equity Shares. Further, we may issue options under the ESOS 2013 from time to time. For details
please see section titled “Capital Structure” on page 81. Any exercise of the stock options could dilute the
holdings of our shareholders and could adversely affect the market price of our Equity Shares.

If our Bank decides to raise additional funds through the incurrence of debt, our interest obligations will
increase, and we may be subject to additional covenants and restrictions based on RBI regulations, which could
further limit our ability to access cash flows from our operations. Such financings could cause our debt to equity
ratio to increase or require us to create charges or liens on our assets in favor of lenders. We cannot assure you
that we will be able to secure adequate financing in the future on acceptable terms, in time, or at all. Our failure
to obtain sufficient financing could result in the delay or abandonment of our expansion plans. Our business and
future results of operations may be adversely affected if we are unable to implement our growth strategies.

The disposal, pledge or encumbrance of Equity Shares by any of our Bank’s major shareholders, or the
perception that such transactions may occur, may also adversely affect the trading price of the Equity Shares.
No assurance may be given that our Bank will not issue Equity Shares or incur substantial debt, or that our
Bank’s shareholders will not dispose of, pledge or encumber their Equity Shares in the future.

75. Investors in the Issue (other than retail individual investors) are not allowed to withdraw their Bids after the
Bid Closing Date.

In terms of the SEBI Regulations, investors in the Issue (other than retail individual investors) are not allowed
to withdraw their Bids after the Bid Closing Date. The Allotment of Equity Shares and the credit of such Equity
Shares to the applicant’s demat account with depository participant could take approximately seven to 12 days
or longer from the Bid Closing Date. However, there is no assurance that material adverse changes in the
international or national monetary, financial, political or economic conditions or other events in the nature of
force majeure, material adverse changes in our business, results of operation or financial condition, or other
events affecting the applicant’s decision to invest in the Equity Shares, would not arise between the Bid Closing
Date and the date of Allotment. Occurrence of any such events after the Bid Closing Date could also impact the
market price of the Equity Shares. The investors in the Issue (other than retail individual investors) shall not
have the right to withdraw their Bids in the event of any such occurrence. We may complete the Allotment even
if such events may limit the applicants’ ability to sell the Equity Shares after the Issue or cause the trading price
of the Equity Shares to decline.

76. You will not be able to sell immediately on an Indian stock exchange any of the Equity Shares you purchase
in the Issue.

The Equity Shares will be listed on the Stock Exchanges. Pursuant to Indian regulations, certain actions must be
completed before the Equity Shares can be listed and trading in the Equity Shares may commence. Investors’
book entry, or “demat” accounts with depository participants in India, are expected to be credited within two

46
 working days of the date on which the Basis of Allotment is approved by the NSE and BSE. Thereafter, upon
receipt of final listing and trading approval from the Stock Exchanges, trading in the Equity Shares is expected
to commence within 12 working days of the Bid Closing Date. There could be a failure or delay in listing of the
Equity Shares on the Stock Exchanges. Any failure or delay in obtaining the approval or otherwise commence
trading in the Equity Shares would restrict investors’ ability to dispose of their Equity Shares. We cannot assure
you that the Equity Shares will be credited to investors’ demat accounts, or that trading in the Equity Shares will
commence, within the time periods specified in this risk factor. We could also be required to pay interest at the
applicable rates if allotment is not made, refund orders are not dispatched or demat credits are not made to
investors within the prescribed time periods.

77. There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect a
shareholder’s ability to sell, or the price at which it can sell Equity Shares at a particular point in time.

We could be subject to a daily “circuit breaker” imposed by all stock exchanges in India, which does not allow
transactions beyond specified increases or decreases in the price of the Equity Shares. This circuit breaker
would operate independently of the index-based market-wide circuit breakers generally imposed by SEBI on
Indian stock exchanges. The percentage limit on our circuit breakers is set by the stock exchanges based on the
historical volatility in the price and trading volume of the Equity Shares. Furthermore, operational errors by
market participants could lead to severe movements in stock prices or indices what may lead to trading
stoppages. A closure of, or trading stoppage on, either the BSE or the NSE could adversely affect the trading
price of the Equity Shares.

The stock exchanges do not inform us of the percentage limit of the circuit breaker in effect from time to time
and may change it without our knowledge. This circuit breaker limits the upward and downward movements in
the price of the Equity Shares. As a result of this circuit breaker, no assurance may be given regarding your
ability to sell your Equity Shares or the price at which you may be able to sell your Equity Shares at any
particular time.

78. We have issued Equity Shares in the last one year at a price which may be lower than the Issue Price.

We have issued Equity Shares in the last 12 months which may be at a price lower than the Issue Price. Please
see section titled “Capital Structure – Equity Shares issued at a price which may be lower than the Issue Price
during the preceding one year” on page 89. The price at which such issuances have been made may not be
indicative of the Issue Price. Further, the Issue Price is not indicative of the price that will prevail in the open
market following listing of the Equity Shares.

79. There is no guarantee that the Equity Shares will be listed on the BSE and the NSE in a timely manner or at
all.

In accordance with Indian law and practice, permission for listing of the Equity Shares will not be granted until
after those Equity Shares have been issued and allotted. Approval will require all other relevant documents
authorizing the issuing of Equity Shares to be submitted. There could be a failure or delay in listing the Equity
Shares on the BSE and/or the NSE. Any failure or delay in obtaining the approval would restrict your ability to
dispose of your Equity Shares.

80. Holders of Equity Shares could be restricted in their ability to exercise pre-emptive rights under Indian law
and could thereby suffer future dilution of their ownership position.

Under the Companies Act, any company incorporated in India must offer its holders of equity shares pre-
emptive rights to subscribe and pay for a proportionate number of shares to maintain their existing ownership
percentages prior to the issuance of any new equity shares, unless the pre-emptive rights have been waived by
the adoption of a special resolution by holders of three-fourths of the shares voted on such resolution, unless the
company has obtained Government approval to issue without such rights. However, if the law of the jurisdiction
in which you are located does not permit the exercise of such pre-emptive rights without us filing an offering
document or registration statement with the applicable authority in such jurisdiction, you will be unable to
exercise such pre-emptive rights unless we make such a filing. We may elect not to file a registration statement

47
 in relation to pre-emptive rights otherwise available by Indian law to you. To the extent that you are unable to
exercise pre-emptive rights granted in respect of the Equity Shares, your proportional interests in us would be
reduced.

81. You may be subject to Indian taxes arising out of capital gains.

Under current Indian tax laws and regulations, capital gains arising from the sale of shares in an Indian bank are
generally taxable in India. Any gain realized on the sale of listed equity shares on a stock exchange held for
more than 12 months will not be subject to capital gains tax in India if the STT has been paid on the transaction.
The STT will be levied on and collected by a domestic stock exchange on which equity shares are sold. Any
gain realized on the sale of equity shares held for more than 12 months to an Indian resident, which are sold
other than on a recognized stock exchange and as result of which no STT has been paid, will be subject to
capital gains tax in India. Further, any gain realized on the sale of listed equity shares held for a period of
12 months or less will be subject to capital gains tax in India.

Capital gains arising from the sale of the Equity Shares will be exempt from tax in India in cases where such
exemption is provided under the tax treaty between India and the country of which the seller is a resident.
Generally, Indian tax treaties, do not limit India’s ability to impose tax on capital gains. As a result, residents of
certain countries may be liable for tax in India, as well as in their own jurisdictions on gain upon a sale of our
Equity Shares.

82. Investors may be adversely affected due to retrospective tax law changes by the Indian government affecting
our Bank.

Certain recent changes to the Income Tax Act provide that income arising directly or indirectly through the sale
of a capital asset of an offshore company, including shares, will be subject to tax in India, if such shares derive
indirectly or directly their value substantially from assets located in India. The term “substantially” has not been
defined under the Income Tax Act and therefore, the applicability and implications of these changes are largely
unclear. Due to these recent changes, investors may be subject to Indian income taxes on the income arising
directly or indirectly through the sale of the Equity Shares. In the past, there have been instances where changes
in the Income Tax Act have been made retrospectively, there cannot be an assurance that such retrospective
changes will not happen again.

83. Investors bear the risk of fluctuation in the price of the Equity Shares.

There has been no public market for the Equity Shares prior to the Issue and the trading price of the Equity
Shares may fluctuate after the Issue. The Issue Price of the Equity Shares in this Issue will be determined by our
Bank in consultation with the Book Running Lead Managers pursuant to the Book Building Process, and it may
not necessarily be indicative of the market price of the Equity Shares after this Issue is complete. You may be
unable to resell your Equity Shares at or above the Issue Price and, as a result, you may lose all or part of your
investment. Following the Issue, the Equity Shares are expected to trade on the NSE and BSE; however, there
can be no assurance that active trading in the Equity Shares will develop after the Issue or, if such trading
develops, that it will continue. Investors may not be able to rapidly sell the Equity Shares at the quoted price if
there is no active trading in the Equity Shares.

In addition, the price at which the Equity Shares will trade after this Issue will be determined by the
marketplace and may be influenced by many factors, including:

 our financial condition and the financial condition of the companies in the businesses we operate in;
 the history of, and the prospects for, our business and the sectors in which we compete;
 an assessment of our management, our past and present operations, and the prospects for, and timing
of, our future revenues and cost structures; and
 the present state of our development.

Further, the Indian stock market has from time to time experienced significant price and volume fluctuations
that have affected the market prices for the securities of Indian companies. As a result, investors in the Equity

48
 Shares may experience a decrease in the value of the Equity Shares regardless of our operating performance or
prospects.

84. Our ability to attract foreign investors may be limited, which may adversely affect the market price of our
Equity Shares post listing.

Under the foreign exchange regulations currently in force in India, transfers of shares between non-residents
and residents are freely permitted (subject to certain exceptions) if they comply with the pricing guidelines and
reporting requirements specified by the RBI. If the transfer of shares is not in compliance with such pricing
guidelines or reporting requirements or fall under any of the specified exceptions, then the prior approval of the
RBI will be required. In addition, shareholders who seek to convert the Rupee proceeds from a sale of shares in
India into foreign currency and repatriate that foreign currency from India will require a no-objection or a tax
clearance certificate from the income tax authority. We cannot assure investors that any required approval from
the RBI or any other government agency can be obtained on any particular terms or at all.

Under the applicable provisions of FEMA, the aggregate permissible foreign investment (including foreign
direct investment and investment by FPIs, FIIs or NRIs) in a bank, such as ours, is limited to an aggregate of
49.00% of the paid up capital under the automatic route, which may be increased up to 74.00% under the
government route, i.e. pursuant to an approval from the FIPB. This cap may have an impact on the allotment to
applicants in the non-resident category. The aggregate total holding of FIIs, FPIs and qualified foreign investors
in banks such as ours cannot exceed 49.00%, with purchases by a single FPI, FII or sub-account of a registered
FII being restricted to below 10.00% of our paid-up capital. We have, subject to requisite approval from the
FIPB, pursuant to shareholders resolution dated February 19, 2014, increased the limit for FIIs and FPIs to 49%
and for NRIs to 24%, of our paid up equity share capital. If foreign investment in our Bank, including
investment by FPIs/FIIs, reaches any of the above mentioned thresholds, the ability of foreign investors to
purchase our Equity Shares may be limited. While delaying an investor’s ability to sell our Equity Shares, this
may also lead to reduced liquidity of our Equity Shares and may have an adverse impact on the market price of
our Equity Shares post listing.

85. Significant differences exist between GAAP as applied in India and other accounting principles with which
investors may be more familiar.

Our financial statements are prepared in conformity with Indian GAAP and conformity with the accounting
norms prescribed by the RBI. GAAP as applied in India differs in certain significant respects from IFRS, U.S.
GAAP and other accounting principles and accounting standards with which prospective investors may be
familiar with in other countries. We do not provide a reconciliation of our financial statements to IFRS or U.S.
GAAP or a summary of principal differences between Indian GAAP, IFRS and U.S. GAAP relevant to our
business. Furthermore, we have not quantified or identified the impact of the differences between Indian GAAP
and IFRS or between Indian GAAP and U.S. GAAP as applied to our financial statements. As there are
significant differences between GAAP as applied in India and IFRS and between GAAP as applied in India and
U.S. GAAP, there may be substantial differences in our results of operations, cash flows and financial position
if we were to prepare our financial statements in accordance with IFRS or U.S. GAAP instead of Indian GAAP.
The significant accounting policies summarized in the section “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” have been applied in the preparation of our Indian GAAP
consolidated financial statements. Prospective investors should review the accounting policies applied in the
preparation of our financial statements, and consult their own professional advisors for an understanding of the
differences between Indian GAAP and IFRS and between Indian GAAP and U.S. GAAP and how they might
affect the financial information contained in this Draft Red Herring Prospectus.

86. Companies in India, including us, will be required to prepare financial statements under Ind-AS. The
transition to Ind-AS in India is still unclear and we may be adversely affected by this transition.

The Ministry of Corporate Affairs (“MCA”), notified the Companies (Indian Accounting Standards) Rules,
2015 on February 16, 2015 (the “IAS Rules”). IAS Rules do not apply to banking companies, insurance
companies and NBFCs. IAS Rules provide that the financial statements of the companies for which IAS Rules
apply (more specifically described below) will be prepared and audited in accordance with the Indian

49
 Accounting Standards (“Ind AS”).

Further, the IAS Rules prescribe that any company having a net worth of more than ` 5,000 million, and any
holding company, subsidiaries, joint ventures and associate companies of such company, would have to
mandatorily adopt IND-AS for the accounting period beginning from April 1, 2016 with comparatives for
periods ending on March 31, 2016. Additionally, under the IAS Rules any company having a net worth of more
than ` 2,500 million, and any holding company, subsidiaries, joint ventures and associate companies of such a
company, other than any company whose securities are listed or in the process of listing on SME platform or
Institutional trading platform of the stock exchanges, would have to mandatorily adopt IND-AS for the
accounting period beginning from April 1, 2017 with comparatives for periods ending on March 31, 2017.

Prominent Notes

 Initial public issue of [●] Equity Shares for cash at a price of ` [●] per Equity Shares including a share
premium of ` [●] per Equity Share, aggregating up to ` 4,000 million. The Issue includes the Net Issue and
the Employee Reservation Portion. The Issue and the Net Issue shall constitute [●] % and [●] % of the fully
diluted post Issue paid up equity share capital of our Bank, respectively. Our Bank, in consultation with the
BRLMs is, considering a Pre-IPO Placement of up to 12,500,000 Equity Shares for cash consideration
aggregating up to ` 1,500 million, at its discretion prior to filing of the Red Herring Prospectus with the
RoC. If the Pre-IPO Placement is completed, the number of Equity Shares issued pursuant to the Pre-IPO
Placement will be reduced from the Issue, subject to a minimum Net Issue size of 25% of the post Issue
paid-up equity share capital being offered to the public.

 The net worth of our Bank as on March 31, 2014 and September 30, 2014 was ` 6,198.60 million and `
5,559.35 million, respectively.

 The net asset value per Equity Share was ` 148.13 and ` 132.85 as on March 31, 2014 and September 30,
2014, respectively, as per our restated audited financial statements.

 Our Bank has not changed its name in the last three years.

 Our Bank does not have an identifiable promoter.

 There are no financing arrangements pursuant to which our Directors or their immediate relatives have
financed the purchase of Equity Shares by any other person during the six months preceding the date of this
Draft Red Herring Prospectus.

 For information on changes in our Registered Office and amendments to the object clause of the MoA, see
section titled “History and Certain Corporate Matters” on page 165.

 Except as disclosed in the section titled “Financial Statements - Related Party Transactions” on page F-
178, there have been no transactions between our Bank and Key Management Personnel during the last
year.

 Any clarification or information relating to this Issue shall be made available by the BRLMs and our Bank
to the investors at large and no selective or additional information would be available for a section of
investors in any manner whatsoever. The BRLMs shall be obligated to provide information or clarifications
relating to this Issue. Investors may contact the BRLMs, who have submitted the due diligence certificate
to SEBI and the Syndicate Members for any complaints pertaining to this Issue.

 All grievances relating to the non-ASBA process must be addressed to the Registrar to the Issue quoting the
full name of the Bidder, Bid cum Application Form number, Bidders’ DP ID, Client ID, PAN, number of
Equity Shares applied for, date of Bid cum Application Form, name and address of the Syndicate Member
or the Registered Broker where the Bid was submitted and cheque or draft number and issuing bank
thereof.

50
 All grievances relating to the ASBA process must be addressed to the Registrar to the Issue, with a copy to
the relevant SCSBs or the Syndicate Members if the bid was submitted to a member of Syndicate at any of
the Specified Locations, or the Registered Brokers, as the case may be, giving full details such as the name
and address of the applicants, number of Equity Shares applied for, Bid Amounts blocked, ASBA Account
number, Bidders’ DP ID, Client ID, PAN and the Designated Branch of the SCSBs or the Syndicate
Bidding Centre where the Bid cum Application Form has been submitted by the ASBA Bidder. All
grievances relating to Bids submitted through the Registered Broker may be addressed to the Stock
Exchanges with a copy to the Registrar to the Issue.

51
 SECTION III – INTRODUCTION

SUMMARY OF INDUSTRY

The information presented in this section has been extracted from publicly available documents from various
sources, including officially prepared materials from the Government and its various ministries, the RBI and the
Indian Banks Association, and has not been prepared or independently verified by our Bank or the Book Running
Lead Managers. The information in this section may not be consistent with other information compiled by third
parties within or outside India. Industry and government publications are also prepared based on information as of
specific dates, which may no longer be relevant or reflect current trends. Industry sources and publications
generally state that the information stated therein have been obtained from sources they believe to be reliable, but
their accuracy, completeness and underlying assumptions are not guaranteed. Accordingly, investment decisions
should not be based on such information. Statements in this section that are not statements of historical fact and
constitute “forward-looking statements”. Such forward-looking statements are subject to various risks, assumptions
and uncertainties and certain factors could cause actual results or outcomes to differ materially.

Overview of the Indian Economy

India is the world's largest democracy in terms of population (approximately 1,236.3 million people as on July 2014
estimate) with an estimated GDP (by purchasing powering parity valuation of country GDP) of approximately US$
4,990,000 million in 2013. Economic liberalization measures, including industrial deregulation, privatization of
state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and served
to accelerate the country's growth, which averaged under 7% per year from 1997 to 2011. India's diverse economy
encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a
multitude of services. Slightly less than half of the work force is in agriculture, but, services are the major source of
economic growth, accounting for nearly two-thirds of India's output with less than one-third of its labor force. India
has capitalized on its large educated English-speaking population to become a major exporter of information
technology services, business outsourcing services, and software workers. India's economic growth began slowing in
2011 because of a decline in investment, caused by high interest rates, rising inflation, and investor pessimism about
the government's commitment to further economic reforms and about the global situation. In late 2012, the
Government announced additional reforms and deficit reduction measures, including allowing higher levels of
foreign participation in direct investment in the economy. The outlook for India's long-term growth is moderately
positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates,
and increasing integration into the global economy. (Source: CIA World Factbook)

The table below sets forth the key indicators of the Indian economy for the last five Fiscals.

(Annual percent change, except for foreign currency reserves)

Particulars As on and for the year ended March 31
2014 2013 2012 2011 2010
GDP growth rate 4.7 4.5 6.7 8.9 8.6
Index of Industrial productivity (growth) (0.1) 1.1 2.9 8.2 5.3
Inflation – Wholesale Price Index (average) 6.0 7.4 8.9 9.6 3.8
Foreign Exchange Reserves (in US$ crore) 30,420 29,200 29,440 30,480 27,910
(Source: Indian Economic Survey 2013-14, MoF, GoI)

After achieving growth of over 9% for three successive years between Fiscal 2006 and Fiscal 2008 and recovering
swiftly from the global financial crisis of 2008-09, the Indian economy has been going through challenging times
that have resulted in lower than 5% growth of GDP for the last two years, i.e., Fiscal 2014 and Fiscal 2013.
Persistent uncertainty in the global outlook, caused by the crisis in Europe and general slowdown in the global
economy, compounded by domestic structural constraints and inflationary pressures, resulted in a protracted
slowdown. The slowdown is broadly in sync with trends in other emerging and developing economies. India’s
growth declined from an average of 8.3% per annum during Fiscal 2005 to Fiscal 2012 to an average of 4.6% during
Fiscal 2013 to Fiscal 2014. In comparison, average growth in the emerging markets and developing economies
including China declined from 6.8% to 4.9% in this period (calendar-year basis) (Source: Indian Economic Survey
2013-14, Ministry of Finance, Government of India).

52
As part of liberalization measures, the RBI has taken a number of measures to enhance the effectiveness of the
prevailing foreign direct investment policy and provide greater clarity on ownership and control. Overall, India
attracted FDI equity inflows of US$24.3 billion in Fiscal 2014, which is an 8.0% increase over the FDI equity
inflows of US$22.42 billion received during the previous Fiscal 2013. (Source: Annual Report 2013-14, Department
of Industrial Policy and Promotion)

Overview of the Indian Banking Industry

Until the 1980s, the Indian financial system was strictly controlled. Interest rates were administered by the
Government. Formal and informal parameters governed asset allocation and strict controls limited entry into and
expansion within the financial sector. The profitability of banks was relatively lower, NPAs were comparatively
high, capital adequacy was diminished and operational flexibility was hindered. The Government’s economic reform
program, which began in 1991, encompassed the financial sector. The first phase of the reform process began with
implementation of the recommendations of the Committee on the Financial System, namely the Narasimham
Committee I. Following that, reports were submitted in 1997 and 1998 by other committees, such as the second
Committee on Banking Sector Reform, namely, the Narasimham Committee II, and the Tarapore Committee on
Capital Account Convertibility. This, in turn, led to the second phase of reforms relating to capital adequacy
requirements, asset classification and provisioning, risk management and merger policies.

Banks in India may be categorised as scheduled banks and non-scheduled banks. Scheduled banks are those that are
included in the second schedule to the RBI Act, comprising scheduled commercial banks and scheduled cooperative
banks. Scheduled commercial banks may further be classified as the State Bank of India and its associates,
nationalised banks, private sector banks, foreign banks and regional rural banks. (In RBI reports, regional rural
banks are usually excluded in tables providing details of individual banks and their summary tables at bank group
level). As of Fiscal 2014, there were 146 scheduled commercial banks in India of which 57 were regional rural
banks. (Source: Quarterly Statistics on Deposits and Credits of Scheduled Commercial Banks, December 2014) As
of Fiscal 2014 scheduled commercial banks had total liabilities/ assets of ` 109,635 billion, registering a growth of
14.3% from Fiscal 2013, and approximately ` 85,331 billion of deposits and approximately ` 67,352 billion of loans
and advances. Aggregate deposits for all scheduled commercial banks had registered an annual growth rate of 14.9%
while the loans and advances for all scheduled commercial banks had increased by 14.5%. (Source: RBI Report on
the Indian Banking Sector at a glance, 2013-2014) As on December 31, 2014, all scheduled commercial banks
registered an annual growth of 15.8%, 14.0%, 12.4% and 8.5% in terms of aggregate deposits from the rural, semi-
urban, urban and metropolitan population, respectively, and an annual growth of 12.7%, 15.0%, 9.2% and 9.2% in
terms of gross bank credit from the rural, semi-urban, urban and metropolitan population, respectively. The credit
deposit ratio for all scheduled commercial banks stood at 76.4. (Source: Quarterly Statistics on Deposits and Credits
of Scheduled Commercial Banks, December 2014)

Constituents of the Indian Banking Industry

The Reserve Bank of India

The RBI is the central regulatory and supervisory authority for the Indian banking sector. Besides regulating and
supervising the banking system, the RBI performs the following important functions:

 acts as the central bank and the monetary authority;

 issues currency;
 manages debt for the central and certain state governments that have entered into agreement with it;
 regulates and supervises NBFCs;
 manages the country’s foreign exchange reserves;
 manages the capital account of the balance of payments;
 regulates and supervises payment settlement systems;
 operates a grievance redressal scheme for bank customers through the banking ombudsmen and formulates
policies for fair treatment of banking customers; and
 develops initiatives such as financial inclusion and strengthening of the credit delivery mechanisms to

53
 priority sectors and weaker sections, including agricultural entities, small and micro-enterprises and for
affordable housing and education.

The RBI issues guidelines on various issues relating to the financial reporting of entities under its supervision. These
guidelines regulate exposure standards, income recognition practices, asset classification, provisioning for non-
performing and restructured assets, investment valuation and capital adequacy. All the institutions under the purview
of the RBI are required to furnish information relating to their businesses on a regular basis.

Banks in India can be classified as follows.

(Source: RBI’s Manual on Financial and Banking Statistics, March 2007)

Key Banking Industry Trends in India

The growth of the Indian banking sector moderated during Fiscal 2014. Profitability of banks declined on account of
higher provisioning on banks’ delinquent loans and lackluster credit growth. The financial health of urban and rural
co-operatives indicated divergent trends in terms of key indicators. While urban co-operative banks exhibited
improved performance, the performance of primary agriculture credit societies and long term rural credit co-
operatives remained a matter of concern with a further increase in their losses coupled with deterioration in asset
quality. While the asset size of NBFCs demonstrated expansion, asset quality deteriorated during Fiscal 2014.
(Source: Report on Trend and Progress in Banking in India 2013 – 2014)

Under-penetration of banking channels

According to the Report of the Committee on Comprehensive Financial Services for Small Businesses and Low
Income Household of the RBI (January 2014), as on December 31, 2013, an estimated 36% of the Indian population
have at least one bank account. Banking penetration in urban and rural India remained grim, overall, with only 45%
of urban residents and 32% of rural residents having bank accounts. Within these matrices, there was significant
variation between various districts. In an urban context the current penetration of individual bank accounts, as
proportion of the population of people above the age of 18 years, ranged from 10% in Imphal East district of
Manipur to 688% in Wayanad district of Kerala, while in the rural context it ranges from close to 0% in the districts
of Nagaland to 89% in Solan in Himachal Pradesh. A large proportion of the bank accounts did not have full service
electronic capabilities. Furthermore, while 89% of Indian districts had 25 or more payment access points (including

54
bank branches, active business correspondent locations, ATMs and point-of-sale terminals) only 3% of the districts
have 25 or more payment access points in rural areas.

In terms of the credit to GDP ratio, the abovementioned report indicates that while above 94% of the Indian
districts’ urban areas have in excess of 10% credit to GDP ratio, only 18% of them are currently above 50%. The
situation in rural areas is significantly worse, with only 30% of Indian districts’ rural areas currently having in
excess of 10% credit to GDP ratio with a mere 2% of Indian districts above 50%.

The table below profiles the differences in outstanding bank credit allocation with respect to the sectors’
contributions to the GDP as on Fiscal 2013 (in respect of sectors that contribution 1% or more to the GDP).

Sectoral GDP Sectoral Credit Credit to GDP

(` crore) (%)
GDP at prices as on Fiscal 2013 9,321,638 Gross bank credit of all 4,861,345 52.00
SCBs
Of which
GDP of agriculture and allied 1,644,834 Credit to agriculture 589,914 35.90
activities
GDP of industry 2,436,502 Credit to industry 2,230,182 91.5
GDP of services 5,240,302 Credit to services 2,041,249 39.00
GDP contribution of Industry 510,473 Credit to Industry MSMEs 284,348 55.70
MSMEs
GDP contribution of Service 1,097,899 Credit to Service MSMEs 277,947 25.30
MSMEs
(Source: Report of the Committee on Comprehensive Financial Services for Small Businesses and Low Income
Household of the RBI (January 2014))

The table indicates that agriculture still has a distance to go before it reaches a benchmark 50% even though it is
above the 10% mark. Industry MSMEs appear to have just above 50% financial depth, while service MSMEs have a
much lower depth at 25%, and have a long way to go to reach a 50% benchmark.

Consumer credit

The consumer credit market in India has undergone a significant transformation over the last decade and has
experienced rapid growth due to consumer credit becoming cheaper, more widely available and increasingly a more
acceptable avenue of funding for consumers. The market has changed dramatically due to the following factors:

 fast emerging working population and middle class population

 increased focus by banks and financial institutions on consumer credit, resulting in a market shift towards
regulated players from unregulated moneylenders/ financiers;
 increasing desire by consumers to acquire assets such as cars, goods and houses on credit;
 growing number of households in a bank’s target segment;
 improved terms of credit;
 legislative changes that offer greater protection to lenders against fraud and potential default, increasing the
incentive to lend; and
 growth in assignment and securitisation arrangements for consumer loans, enabling non-deposit based
entities to access wholesale funding and compete in the market, based on the ability to originate, underwrite
and service consumer loans.

Retail Banking

During Fiscal 2014, banks’ retail loans portfolios continued to growth rapidly. Total retail loans increased by 15.4%
from November 2013 to November 2014, mainly led by growth in housing loans as the largest segment of retail
loans and an increasing growth in auto loans. (Source: RBI, Press Release, Sectoral Deployment of Bank Credit –
November 2014)

55
 (` billion, except percentages)
Particulars Outstanding as on Percentage variation
Nov 2012 Nov 2013 Nov 2014 Nov 2013/ Nov 2014/
Nov 2012 Nov 2013
Housing loans 4,337 5,121 5,960 18.1% 16.4%
Vehicle loans 1,033 1,240 1,459 20.1% 17.6%
Advances against fixed 557 565 557 1.5% (1.4)%
deposits
Education 544 589 628 8.3% 6.6%
Credit card receivables 247 241 295 (2.0)% 22.1%
Consumer Durables 75 100 147 32.8% 46.8%
Advances to individuals 28 33 40 17.5% 23.9%
against securities
Other personal loans 1,725 1,955 2,271 13.3 16.2
Total retail loans 8,545 9,844 11,357 15.2% 15.4%
(Source: RBI, Press Release, Sectoral Deployment of Bank Credit – November 2014)

Gold loans

India continues to be one of the largest gold markets in the world. The attraction towards gold in India stems from
varied historical and cultural factors and its perceived safety in times of economic stress. South India as a region
continues to be the largest consumer of gold in India with the southern states accounting for over 40% of India’s
overall gold demand, followed by the west (25%), north (20-25%) and east (10-15%). Rural India is estimated to
hold around 65% of total gold stock as this section of the population views gold as a secure and easily accessible
savings vehicle along with its consumption purpose. (Source: RBI Report of the Working Group to Study the Issues
Related to Gold Imports and Gold Loans by NBFCs)

Accordingly, even the gold loan market has also developed on the same lines where a large portion of market is
concentrated in southern India. The southern region of India accounts for the largest share of the gold loans market
in India.

The prevalence of high level of rural indebtedness, easy availability of gold loans at extreme flexible terms, relative
constriction of personal and retail loans by banks and changing attitude of customers to avail gold loans have
contributed to the sharp growth in the gold loans outstanding. (Source: RBI Report of the Working Group to Study
the Issues Related to Gold Imports and Gold Loans by NBFCs)

Annual Growth Rate of Gold Loans Outstanding (%)

Year Banks Gold Loans NBFC Gold Loans Total Gold Loans
2008-09 54.2 41.4 52.5
2009-10 47.7 169.3 62.6
2010-11 52.1 126.7 67.2
2011-12 77.6 80 78.3
(Source: RBI Report of the Working Group to Study the Issues Related to Gold Imports and Gold Loans by NBFCs)

Gold loans disbursed by NBFCs have witnessed rapid growth in the recent past. Therefore, there is a general feeling
that NBFCs account for the majority of gold loans disbursed. However, contrary to popular belief, share of banks in
total gold loans is highest at 72.3% at March 31, 2012 and banks continue to retain the dominant share in the gold
loan market. (Source: RBI Report of the Working Group to Study the Issues Related to Gold Imports and Gold
Loans by NBFCs)

Commercial Banking Trends

Balance Sheet Operations of Scheduled Commercial Banks

Continuing a trend from the year Fiscal 2012, the overall growth in the balance sheets of scheduled commercial
banks moderated further in the year Fiscal 2013. The major source of this moderation was bank credit, which was
partly reflective of the slowdown in real economy activity coupled with increasing risk aversion by banks. The

56
slowdown in credit growth in Fiscal 2013 as compared to Fiscal 2012 could be seen across all bank groups, except
SBI and its associates. Although there was a moderation in the balance sheet of the banking sector, deposits – the
largest component on the liabilities side – maintained their growth in 2012-13, particularly for private banks.
(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

The table below sets out the change in balance sheet of scheduled commercial banks in Fiscal 2013, as compared to
Fiscal 2012.

(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

Credit-Deposit Ratio

As on March 31, 2014, the credit deposit ratio for all commercial banks was 77.8% as compared to 77.9% in Fiscal
2013. Aggregate deposits grew by 14.2% and bank credit grew by 14.0% in Fiscal 2014. Deployment of credit to
industries moderated in Fiscal 2014, even as credit to agriculture and allied activities, services and personal loans
picked up. Within industries, sectors such as food processing, construction, leather, rubber, glass and paper
witnessed an upturn during April 2014 to February 2014 (Source: Macroeconomic and Monetary Developments
2014-15 (An Update), RBI April 2014 and Annual Report for Fiscal 2014).

As on March 31, 2013, the credit-deposit ratio for scheduled commercial banks was 79.1 as compared to 78.6 as of
Fiscal 2012. Aggregate deposits increased by 15.1% while loans and advances increased by 15.9% as of Fiscal 2013.
(Source: Report on Trend and Progress in Banking in India 2012 – 2013)

Credit growth on a year-on-year basis declined in Fiscal 2014, and recorded a low of 10.00% as on September 2014.
Public sector banks under-performed other banks in terms of credit growth, recording a growth of 7.9%. Growth in
deposits also declined to 12.9% as of September 2014 from 13.7% as of March 2014. Low credit growth reflected a
combination of factors such as reliance on alternative sources of funding, balance sheet repair and slack in demand
as also an element of risk aversion. (Source: Report on Trend and Progress in Banking in India 2013 – 2014)

57
There was an overall rise in the growth of priority sector credit in Fiscal 2014 as compared to a drop in overall credit
growth during the year. In Fiscal 2013, credit to priority sectors by public and private sector banks were 39.4% and
35.8%, respectively (representing the higher of the adjusted net bank credit or the credit equivalent of the off-
balance sheet exposure), which fell short of the overall target of 40%. 10 out of 26 public sector banks, 4 out of 20
private sector banks and one out of 39 foreign banks could not achieve the target of the overall priority sector as on
March 31, 2014. (Source: RBI Annual Report for 2013-2014)

In the past, growth in credit to sensitive sectors, namely, real estate, capital markets and commodities, generally
followed a pattern similar to the growth in overall credit. However, in Fiscal 2013, growth in credit to sensitive
sectors almost doubled primarily on account of credit to real estate. This expansion needs to be viewed in light of the
steep rise in housing prices in all Tier I cities and several Tier II cities in Fiscal 2013 (Source: RBI Report on Trend
and Progress of Banking in India 2012-13).

MSME sector

Small enterprises play a very significant role in terms of balanced and sustainable growth of the economy. Small
enterprises contribute 38% of the manufacturing output and around 40% of the total export of the country and
providing employment to nearly 106 million people through about 46 million units, located in both the rural and
urban areas across the country. According to the Ministry Of Micro, Small and Medium Enterprises, the number of
MSME units in India has grown at a CAGR of 4% during last five years. Strong growth in total investments in
MSMEs indicates towards their expanding footprint and growing importance. (Source: Ministry of Micro, Small and
Medium Enterprises, Annual Report 2013-2014)

MSMEs primarily rely on bank finance for their operations and as such ensuring timely and adequate flow of credit
to the sector has been an overriding public policy objective. Over the years there has been a significant increase in
credit extended to this sector by the banks. As at the end of March 2011, the total outstanding credit provided by all
Scheduled Commercial Banks to the MSME sector stood at ` 4,785.27 billion as against ` 3,622.90 billion in March
2010, registering an increase of 32%. (Source: Address of the Deputy Governor of the RBI at the SME Banking
Conclave 2012)

58
 SUMMARY OF BUSINESS

Overview

We are one of the oldest private sector banks in India with a history of over 94 years, and a strong base in Kerala
along with significant presence in Tamil Nadu, Karnataka and Maharashtra. We offer a wide range of products and
services, with particular focus on small and medium enterprises (“SME”), retail and NRI customers. We deliver our
products and services to our customers through multiple channels, including 431 branches (comprising five service
branches) and 232 ATMs spread across 15 states and four union territories and cater to an overall customer base of
1.61 million as on December 31, 2014.

While our Bank has a long operating history as a traditional bank, we are currently focusing on initiatives to
transform ourselves into a full service contemporary bank. To this end, we have recently undertaken a number of
initiatives to enhance our business focus by upgrading processes, technology and human resources. As part of our
transformation, we are in the process of organizing our operations under focused business areas; re-aligning,
training and incentivizing employees; creating new products and services; increasing sales and marketing efforts;
investing in technology and strengthening our monitoring and risk management policies.

We have four principal business areas, namely, (a) SME banking, (b) retail banking, (c) corporate banking, and (d)
treasury operations.

Under our SME banking business, we cater to small and medium manufacturing units, services and trading
companies, with borrowing needs up to ` 250 million. We offer a wide range of products including term loans, cash
credit, working capital finance, foreign currency loans, export credit, bill discounting, letters of credit and bank
guarantees. We believe that lending to SME customers enables us to diversify our credit risk due to relatively
smaller individual exposures. SMEs offer comparatively higher yields, cross-selling and associated business
opportunities, along with higher degree of secured and collateralized loans and also enable us to meet our priority
sector targets. As on December 31, 2014, our Bank has 382 branches in metro, urban and semi urban locations,
which we believe are conveniently located in close proximity to a large proportion of our existing and target SME
customer base. Further, in order to reduce our turnaround time, we have decentralized our credit process by
establishing eight regional credit hubs for proposals within the lending power of the branches and zonal offices and
one central credit hub for proposals under the head quarter lending powers. As a percentage of our total advances,
loans to SME customers accounted for 33.41%, 40.40% and 43.18% as on March 31, 2013, March 31, 2014 and
September 30, 2014, respectively.

Under our retail banking business, we offer a wide range of loan and deposit products to our retail and NRI
customers, such as gold loans, loans against properties, personal loans, housing loans and agricultural loans, and
deposit products such as current accounts, savings accounts, term deposits and cumulative deposit accounts. Gold
loan advances constituted 38.31%, 32.04% and 29.54% of our total advances as on March 31, 2013, March 31, 2014
and September 30, 2014 and continues to be a mainstay for our Bank on the retail advances side. On the deposits
side, NRI deposits have been a stable source of funding for our Bank constituting 13.47%, 17.27% and 18.50% of
our total deposits as on March 2013, 2014 and September 30, 2014, and has grown at a CAGR of 33.43% during the
last three Fiscals. For facilitating fund transfer services required by our NRI customers, we have remittance and
rupee drawing arrangements with 14 exchange houses in the Middle East. We also have tie ups with major money
transfer agents including Wall Street Finance Limited, MoneyGram Payment Systems Inc, Weizmann Forex Ltd and
UAE Exchange & Financial Services Ltd, which enhances our capability to provide international remittance services
and strengthens our NRI business.

Our retail banking business also includes financial inclusion products, as well as fee income from distribution of
third-party products such as life insurance and general insurance. We distribute life insurance products of Edelweiss
Tokio Life Insurance Company Limited, and are in the process of finalizing an agreement with a leading general
insurance company for distributing general insurance products. As a percentage of our total advances, retail banking
advances accounted for 50.79%, 45.57%, and 43.66%, as on March 31, 2013, March 31, 2014 and September 30,
2014, respectively.

59
Under our corporate banking business, we cater to companies with an annual turnover of over ` 1,000 million (with
credit requirement of above ` 250 million). As a percentage of our total advances, corporate banking advances
accounted for 15.80%, 14.03%, and 13.16% as on March 31, 2013, March 31, 2014 and September 30, 2014,
respectively.

Our treasury operations primarily consist of statutory reserves management, liquidity management, investment and
trading, and money market and foreign exchange activities. Our treasury operations are aimed at maintaining an
optimum level of liquidity, while complying with the RBI mandated cash reserve ratio and the statutory liquidity
ratio. We maintain SLR through a portfolio of central Government, state Government, corporate debt and trustee
securities that we actively manage to optimize yield and benefit from price movements. We are also involved in the
trading of securities and foreign exchange, and invest in sovereign debt instruments, commercial papers, mutual
funds, certificates of deposits, floating rate instruments, bonds and debentures to manage short-term surplus liquidity
and further optimize yield and to generate profits thereon.

As on December 31, 2014, we have a network of 431 branches and 232 ATMs. Out of our 431 branches, 55
branches are in metropolitan cities, 102 branches in urban areas, 225 branches in semi-urban and 49 branches in
rural areas. For efficient administration, we have organized all our branches under nine zonal offices. We deliver
our products and services through multiple delivery channels that include branches, ATMs, internet and mobile
banking.

Our total assets have increased from ` 119,754.07 million as on March 31, 2012 to ` 134,486.34 million as on
March 31, 2013, to ` 151,653.82 million as on March 31, 2014, at a CAGR of 12.53%. Our total deposits have
increased from ` 106,048.70 million as on March 31, 2012 to ` 123,416.26 million as on March 31, 2013, to `
136,738.61 million as on March 31, 2014, at a CAGR of 13.55%. During the same period, our total advances have
increased from ` 77,676.90 million as on March 31, 2012 to ` 89,759.71 million as on March 31, 2013, and
decreased slightly from this level to ` 88,540.20 million as on March 31, 2014, at a CAGR of 6.76%. Our total
assets, total deposits and total advances as on September 30, 2014 are ` 155,494.28 million, ` 141,655.02 million
and ` 96,087.65 million respectively.

Our total income (interest income plus other income) increased from ` 11,607.95 million in Fiscal 2012, to `
14,154.30 million in Fiscal 2013 to ` 16,212.96 million in Fiscal 2014, at a CAGR of 18.18%. During the same
period, our net profit after tax increased from ` 260.44 million in Fiscal 2012, to ` 266.17 million in Fiscal 2013, to
` 309.46 million in Fiscal 2014, at a CAGR of 9.01%. Our total income and net profit after tax for the six months
ended September 30, 2014 are ` 8,162.74 million and ` (181.47) million respectively. As on September 30, 2014,
our CRAR, Tier 1 Capital and Tier 2 Capital was 9.87%, 7.96% and 1.91% respectively as per Basel – II, and
9.72%, 7.87% and 1.85% respectively as per Basel – III. In order to augment our capital base, we raised ` 613.10
million through preferential allotment of Equity Shares to investors, in October 2014, followed by rights issue to
existing Shareholders in March 2015, where we raised Equity capital to the tune of ` 1,131.33 million.

OUR COMPETITIVE STRENGTHS:

We believe that the following strengths distinguish us in a competitive Indian banking industry:

Strong and trusted brand in south India

With over 94 years of history, we believe we have developed a well-recognized and trusted brand in south India,
particularly in the states of Kerala, Tamil Nadu and Karnataka where we have built strong relationships with many
of our customers, which has been one of our key growth drivers. We believe that we are known for the quality of
service we have provided to our customers over the years and for our consistent approach to developing long-term
relationships with our customers, based on our local knowledge and experience amongst other things. We believe
that our strong customer and neighbourhood centric focus, has played a significant role in enhancing customer
service experience and maintaining customer loyalty, on account of which we have been long-term bankers to a
significant number of our SME customers. As on September 30, 2014, on the advances side, we had 3,899 SME
customers who have been our customers for over five years contributing 45.40 % of our total SME advances.

60
We believe that the trust reposed in our brand has enabled us in developing and maintaining a robust and loyal
deposit franchise, consisting of a distinctive clientele, including numerous churches, charitable trusts, welfare
boards, temple trusts, and educational institutions. Further, our strong gold portfolio is also a testimonial to the trust
placed in our brand by the customers.

Focus on the SME business

We believe that SMEs are often confronted with challenges as compared to large corporates, such as availability of
adequate and timely financial resources. We focus on meeting the funding and banking requirements of these SME
customers so as to ensure that their business continues seamlessly. As a percentage of our total advances, loans o
SME customers accounted for 33.41%, 40.40%, and 43.18% as on March 31, 2013, March 31, 2014 and September
30, 2014, respectively.

We believe that lending to SMEs enables us to diversify our credit risk profile due to relatively smaller individual
exposures. As on September 30, 2014, our advances to SME customers aggregated to ` 41,493.58 million, spread
across 10,581 advance accounts. Further, as on September 30, 2014, working capital advances such as cash credit
and overdraft facilities, constituted 78.63% of our total advances to our SME customers, while the remaining
21.37% were contributed by term loans.

SMEs offer comparatively higher yields, cross-selling and associated business opportunities, and higher degree of
secured and collateralized loans. As on September 30, 2014, 98.66 % of our SME loan portfolio is secured. Lending
to SMEs also provides us a good geographic spread and helps us meet our priority sector lending targets.

As on December 31, 2014, we have 382 branches in metro, urban and semi urban locations which we believe are
conveniently located in close proximity to a large proportion of our existing and target SME customer base. To
enhance our sales and marketing efforts, we have established a separate team focusing on SME business with
designated team leaders in every zone, assisting the branches to source additional business and achieve deeper
penetration. We synergistically leverage our branch network, the expertise of our branch managers and the SME
team to create a customer-centric culture, where the emphasis is to satisfy the complete banking and financial needs
of our SME customers by offering them a portfolio of products and services, customized and tailor-made to their
specific requirements. Further, in order to reduce our turnaround time, we have decentralized our credit process by
establishing eight regional credit hubs for proposals within the lending power of the branches and zonal offices and
one central credit hub for proposals under the head quarter lending powers.

We believe our branch-centric business model combined with local experience, long-standing client relationships,
customer service quality and streamlined organizational structure allows us to respond faster and suitably to the
needs of our SME customers.

Retail offering focused on gold loans and NRI business

We have wide presence in south India, with 365 of our 431 branches located in the states of Kerala, Tamil Nadu,
Karnataka, Andhra Pradesh and Telangana, as on December 31, 2014. Of these 365 branches, we have 282 branches
in Kerala, 58 branches in Tamil Nadu, 16 branches in Karnataka, six branches in Andhra Pradesh and three branches
in Telangana. In order to drive penetration, we have strategically opened over 40 branches in these five states in the
last three Fiscals.

South India as a region continues to be the largest consumer of gold in India with the southern states accounting for
over 40% of India’s overall gold demand, followed by the west (25%), north (20-25%) and east (10-15%) (Source:
(Source: RBI Report of the Working Group to Study the Issues Related to Gold Imports and Gold Loans by NBFCs,
January 2013). Gold loans constituted a major portion of our advances, contributing 38.31%, 32.04%, and 29.54%
of our total advances as on March 31, 2013, March 31, 2014 and September 30, 2014, respectively. As on
September 30, 2014, we had 449,436 gold loan accounts, with advances aggregating to ` 28,383.01 million,
implying an average ticket size of ` 0.06 million. Apart from liquidity of the security and low probability of credit
losses, gold loan advances offer benefits of hassle free lending and lower operational costs.

61
Kerala has a large population of NRIs, where our extensive branch network provides us an opportunity to build
strong portfolio of NRI deposits. NRI deposits have been a stable source of funding for our Bank, constituting
13.47%, 17.27% and 18.50% of our total deposits as on March 31, 2013, March 31, 2014 and September 30, 2014,
respectively, and have grown at a CAGR of 33.43% during the last three Fiscals. For facilitating fund transfer
services required by our NRI customers, we have remittance and rupee drawing arrangements with 14 exchange
houses in the Middle East. We also have tie ups with major money transfer agents including Wall Street Finance
Limited, MoneyGram Payment Systems Inc, Weizmann Forex Ltd and UAE Exchange & Financial Services Ltd,
which enhances our capability to provide international remittance services and strengthens our NRI business.

Professional and experienced management

We are a professionally managed Bank. The members of the Board have significant finance and banking experience
and include associates of the Indian Institute of Banking, Chartered Accountants and retired IAS officers. The part-
time Chairman of our Bank, Mr. S. Santhanakrishnan, has been a fellow of the Institute of Chartered Accountants of
India for over 30 years and is a practicing Chartered Accountant. Several of our Directors are also on the Board of
reputed companies. Our Board of Directors and the Key Managerial Personnel have been responsible for
undertaking a number of change initiatives to enhance the business focus of the Bank by upgrading processes,
technology and human resources.

Our Key Managerial Personnel bring substantial experience and in-depth knowledge of banking operations and
management. While several of our Key Managerial Personnel have been with our Bank since the 1980s, we have
also brought in other experienced professionals from the banking industry and our Key Managerial Personnel have
an average banking experience of 23 years. We believe that our management’s capabilities, strong reputation,
extensive network of industry relationships and wide-ranging experience in the finance and banking industry will
continue to help us to grow, modernize and develop further. For further details please refer the section titled “Our
Management” on page 172.

Streamlined risk management controls, policies and procedures

We have instituted prudent risk management controls, policies, and procedures that are critical for the long-term
sustainable development of our business. We have implemented risk management procedures for our credit
exposures, including credit evaluation, credit scoring, risk based pricing models, and risk monitoring and control
mechanisms. We have developed our own credit risk rating framework in terms of which all exposures of ` 2.50
million and above are brought within a rating mechanism. The rating framework incorporates, inter-alia, financial
analysis and sensitivity, industrial and management risks. A separate risk management department formulates and
implements credit risk evaluation, approves risk management framework and policies, oversees the credit approval
process and periodically reviews the same so as to ensure that the business conducted is consistent with our risk
appetite, with a focus on maintaining and enhancing asset quality. Further, retail lending is parameterized based on
an internally developed framework. We periodically conduct audits/inspections to ensure that the risks on our
portfolios are within acceptable parameters. We continuously monitor our portfolios through our internal control
system, which includes macro level portfolio analysis, migration of credit rating analysis and stress testing analysis.

Our credit risk policy is periodically reviewed and updated to incorporate changes in the environment, market and
regulatory guidelines. We have an asset liability management committee for managing market risk; credit risk
management committee for credit risk; and operations risk management committee for operations risk. We are
focused on maintaining high standards of asset quality through risk management and mitigation practices.

We also manage risk by ensuring that our advances are adequately secured. As on March 31, 2013, March 31, 2014
and September 30, 2014, 96.48 % (i.e., ` 85,395.26 million), 96.34% (i.e., ` 83,888.90 million) and, 95.62% (i.e.,
` 90,176.29 million), respectively, of our advances were secured.

BUSINESS STRATEGIES:

Continue to focus on SME customers

62
Small enterprises play a very significant role in terms of balanced and sustainable growth of the economy. Small
enterprises contribute 38% of the manufacturing output and around 40% of the total export of the country providing
employment to nearly 106 million people through about 46 million units, located in both the rural and urban areas
across the country (Source: Ministry of Micro, Small and Medium Enterprises, Annual Report 2013-2014)). Our
SME advances constituted 43.18% of our total advances, as on September 30, 2014. We believe that with our strong
relationships with SME customers and the strategic location of our branches, we are well placed to reap the benefits
of growth in this sector.

We intend to remain focused on SME customers by providing them support through the life cycle of their business -
from inception to expansion including modernization of their businesses. We aim to use our in-depth knowledge and
local experience of banking requirements of SMEs to grow in sectors that we believe have good growth potential
such as healthcare, education, real estate, textiles, agriculture, infrastructure, food processing and fisheries and
formulate specific products, services, processes and delivery capabilities to cater to the requirements of SME
customers. We intend to increase our bouquet of offerings to our SME customers by providing them additional
service offerings such as cash management, foreign exchange, point-of-sale services. We are also continuously
working to refine our business model to promptly respond to the needs of our SME customers, while maintaining
and ensuring adequate risk management. In addition to growing our advances, we intend to mobilize low cost CASA
deposits, as also increase cross selling to augment our fee-based income from SME customers. We believe that
growth in advances to SME customers helps us in increasing our net interest margins as well as diversifying our
advances portfolio thereby reducing risks.

We aim to maximize the value of our small business relationships by leveraging our distribution network and
infrastructure, effective use of technology, speedy response and quality service and also by continuously upgrading
our products and services. To expand our SME business, we also aim to appoint relationship officers as part of our
recently created SME team, to assist our branches. We intend to further augment our specialized SME team, both in
terms of manpower and expertise, and strengthen our marketing and client out-reach efforts through our branch
managers, who are an integral part of our business development initiatives, in order to source additional business
and drive further penetration.

Grow retail business

The consumer credit market in India has undergone a significant transformation over the last decade and has
experienced rapid growth due to consumer credit becoming cheaper, more widely available and increasingly a more
acceptable avenue of funding for consumers. During Fiscal 2014, Indian banks’ retail loans portfolios continued to
growth rapidly and total retail loans increased by 15.4% from November 2013 to November 2014, mainly led by
growth in housing loans as the largest segment of retail loans and an increasing growth in auto loans. (Source: RBI,
Press Release, Sectoral Deployment of Bank Credit – November 2014). We intend to capitalize on the opportunity
presented by retail banking, by enhancing our products, services offering and customer delivery capabilities.

As part of our overall retail strategy, we intend to invest in further strengthening our brand, which may include
changes to our brand identity, augmenting our technology capabilities selectively upgrading our branch
infrastructure, enhancing capabilities across alternate delivery channels, setting up a customer call centre, and by
migrating certain operational activities from the branches to a central unit.

CASA is the prime source of low cost funds for us. As on September 30, 2014, our CASA deposits were
` 25,448.41 million representing 17.96% of our total deposits. We seek to augment our CASA deposits in order to
reduce cost of funds and improve our core capital. We propose to increase our CASA by launching deposit products
across business, enhancing our brand presence, attracting new retail customers, appointing relationship managers for
high net worth customers, introducing loyalty programs, expanding our ATM coverage, and enhancing mobile and
internet banking platforms.

In order to further grow our retail loan portfolio and diversify our loan portfolio mix, we intend to increase
marketing and sales resources at our branches, launch new products (including new variants for loan against
properties and gold loans), invest in technology for speedier credit processing and improved monitoring, and cross
sell products like life insurance to our existing customers. Our flagship product in loan against property- “property
encash” was recently launched. Our loan against property products are being positioned for meeting the specific

63
funding requirements of our retail customers, small business owners and entrepreneurs, thereby augmenting our
portfolio of key offerings in the retail business. As on March 31, 2014, the net LAP advances stood at ` 697.80
million, which have increased significantly to ` 1,143.40 million, as on September 30, 2014. We shall continue to
drive penetration of our LAP product, by leveraging on the strength of our customer relationships and distribution
network.

Increase NRI business

Our NRI deposits have grown from ` 9,940.61 million in Fiscal 2011 to ` 23,616.20 million in Fiscal 2014, at a
CAGR of 33.43% during the same period, which is more than twice the growth experienced in our total deposits
during the same period. As on March 31, 2013, March 31, 2014 and September 30, 2014, our total NRI deposits
constituted 13.47 %, 17.27 % and 18.50 %, respectively, of our total deposits. We intend to continue to focus on
increasing our NRI deposit base, which has been one of our key growth engines on the deposit side, and has also
proved to be a stable source of funding for our Bank.

We have created a separate NRI product management team, and are focused on augmenting our NRI business in
addition to our branches, all of which are equipped to offer specialized services to our NRI customers. The NRI
team extends comprehensive support to our branches in all NRI related matters and drives the growth of our NRI
business, with special emphasis on increasing our share of inward remittances and deposits from the Middle East, by
leveraging our strong customer base and distribution network in Kerala. We have remittance and rupee drawing
arrangements with 14 exchange houses in the Middle East and tie ups with major money transfer agents, which we
plan to expand further. Further, we aim to offer products and services based on customer segmentation, provide
wealth management services advisory services and differentiated products to high net worth customers, appoint
dedicated relationship managers and create exclusive NRI customer service areas in select branches. We also intend
to enter into strategic partnerships to acquire, engage and service NRI customers in the Middle East.

Increase fee and non-fund based revenues

An important strategic focus for us is to grow our fee and non-fund based revenues. Our fee and non-fund based
revenues constituted 3.47%, 3.27% and 3.68% of our total revenue for Fiscals 2013, 2014 and for six months ended
September 30, 2014, respectively. We believe that our increased focus on retail and SME customers, integrated
branch network, technology led channels and increasingly diversified product mix will enable us to increase our fee
and non-fund based revenues.

To our existing SME customers, we aim to market fee and non-fund based products such as letters of credit, bank
guarantees, foreign exchange services and insurance products. We also intend to acquire new SME customers who
specifically require such fee and non-fund based products. For our retail customers, we intend to follow a
relationship based approach by providing and expanding our third party product offerings including mutual fund and
insurance products, wealth management services, money transfer and foreign exchange services.

We have entered into a corporate agency agreement with Edelweiss Tokio Life Insurance Company Limited to
distribute life insurance products. Further, we are in the process of finalizing an arrangement with a leading general
insurance company to distribute general insurance products. These arrangements will further enable us enhance our
sales and distribution capabilities for growing the bancassurance business, and driving penetration. We intend to
further increase this revenue stream by entering into more agency and distribution arrangements and enhancing our
products and services offerings. We currently have over 50 employees involved in selling these insurance products
who have been authorized by the IRDA to act as specified persons for selling insurance products and we intend to
increase the number of such employees to augment our sales and marketing capabilities.

We earn commission on the fund transfer services provided by us to our NRI customers for which we have
remittance and rupee drawing arrangements with 14 exchange houses in the Middle East. We also have tie ups with
major money transfer agents including Wall Street Finance Limited, MoneyGram Payment Systems Inc, Weizmann
Forex Ltd and UAE Exchange & Financial Services Ltd. We plan to enter into many more of such agreements to
further enhance our capability to provide international remittance services and strengthens our NRI business and
consequently increase our earnings from the commission on NRI remittances and money transfers services.

64
Efficiently manage NPAs and continue to focus on strengthening risk management

The share of gross NPAs as a percentage of total advances increased from 2.35% as on March 31, 2013 to 3.77% as
on March 31, 2014 and was 5.56% as on September 30, 2014. The share of net NPAs as a percentage of total
advances increased from 1.12% as on March 31, 2013 to 2.22% as on March 31, 2014 and was 3.76% as on
September 30, 2014. The increase in NPA during Fiscal 2014 is primarily attributable to the impairment of certain
corporate loans. The reduction and recovery of impaired assets is our key focus area. We continuously evaluate
various aspects of our credit and risk management, including origination, monitoring and recovery of loans. These
efforts are supervised by our executive and Board committees.

We are committed to efficiently managing and reducing our NPAs, as well as stressed assets, and are implementing
measures to manage and reduce our NPAs. In relation to origination and appraisal of our loans, we propose to
continuously review and upgrade our rating models, scorecards and credit approval process, including training and
enhancing our resources.

We have recently implemented monitoring systems to identify potential problem loans by continuously tracking our
portfolio through a dedicated monitoring team. Further, for SME loans above a defined threshold, the dedicated
relationship managers support our branches to engage with customers on a continuous basis in order to initiate
remedial measures based on early warning signs.

We have recently created a dedicated recovery team which organizes recovery camps, enters into compromises and
settlements, engages recovery agents, and evaluates and undertakes timely and appropriate legal action (including
invocation of the SARFAESI Act, initiating recovery suits, and resorting to Government-supported revenue
recovery proceedings). Further, where we deem appropriate, we sell our stressed or impaired assets to ARCs.

In addition, we are currently in the process of appointing an external agency to assist us with upgrading all aspects
of credit and risk management, including origination, credit processing, monitoring and recovery.

65
 SUMMARY FINANCIAL INFORMATION

The following tables set forth the summary financial information derived from the audited restated standalone
financial statements, prepared in accordance with Generally Accepted Accounting Principles in India (“Indian
GAAP”) , the Banking Regulation Act, the guidelines issued by RBI from time to time, the Companies Act, 1956
and Companies Act, 2013, and the rules there under, as the case may be, and restated in accordance with the SEBI
Regulations as on and for Fiscals 2010, 2011, 2012, 2013 and 2014 and as on and for the six months ended
September 30, 2014.

The financial statements referred to above are presented under the section titled “Financial Statements” on page 190.

The summary financial information presented below should be read in conjunction with these financial statements,
the notes thereto and the section titled “Financial Statements” on page 190.

Summary Statement of Assets & Liabilities as Restated

(` in million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
S. NO. PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
A. ASSETS
1 Cash in Hand 548.37 597.37 661.02 846.80 720.21 904.26
2 Balance with RBI 5,308.00 5,274.04 6,203.74 5,445.78 5,518.82 5,394.86
3 Balance with Banks
In India 283.78 725.90 2,436.23 3,972.86 3,637.86 327.81
Outside India 416.20 403.58 409.12 384.75 866.13 998.84
Money at Call & Short
4
Notice 499.67 - - - - -
5 Investments
Gross Investment In India 22,920.66 26,930.69 31,474.46 33,046.20 51,397.84 51,388.51
Less: Provision for NPA
Investment - - - - - -
Less: Depreciation on
Investment 26.55 28.11 23.00 35.68 81.31 58.60
Net Investment In India 22,894.11 26,902.58 31,451.46 33,010.52 51,316.53 51,329.91
Outside India - - - - - -
6 Advances
In India 44,669.38 62,200.25 76,635.43 88,515.18 87,073.62 94,303.03
Outside India - - - - - -
7 Fixed Assets 793.98 753.03 758.78 1,694.58 1,736.45 1,720.95
Less: Revaluation Reserve 401.53 395.12 387.66 1,267.12 1,253.11 1,246.45
Net Fixed Assets 392.45 357.91 371.12 427.46 483.34 474.50
8 Other Assets 1,531.09 1,445.82 1,925.91 2,353.01 2,287.90 2,463.89
Less: Deferred Tax and
Intangible Assets 417.18 310.81 339.96 470.02 250.59 702.82
Net Other Assets 1,113.91 1,135.01 1,585.95 1,882.99 2,037.31 1,761.07
TOTAL (A) 76,125.87 97,596.64 119,754.07 134,486.34 151,653.82 155,494.28

B. LIABILITIES
1 DEPOSITS
Demand Deposit
From Banks 6.05 12.19 14.49 3.88 5.32 2.51
From Others 2,914.83 3,256.80 3,464.10 3,289.67 3,309.13 3,892.52
2 Saving Deposits 14,605.94 16,242.46 17,004.97 18,340.40 20,295.38 21,553.38
3 Term Deposits from Banks 1,671.39 2,804.42 4,213.90 4,594.61 4,989.09 3,681.08
Term Deposits from others 50,585.29 64,940.82 81,351.24 97,187.70 108,139.69 112,525.53
4 Borrowings
In India 0.73 2,321.19 4,419.65 819.06 4,480.43 4,752.95
Outside India - - - - - -

66
 Half Year
FINANCIAL YEAR ENDED 31ST MARCH
S. NO. PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
Subordinate Debts(Tier-II
Bonds) 928.00 917.00 1,335.00 1,175.00 1,075.00 575.00
Other Liabilities &
5
Provisions 2,391.65 2,336.70 3,000.98 3,276.28 3,161.18 2,951.96
TOTAL (B) 73,103.88 92,831.58 114,804.33 128,686.60 145,455.22 149,934.93

C. NET WORTH (A-B) 3,021.99 4,765.06 4,949.74 5,799.74 6,198.60 5,559.35

D. Share Capital 189.26 313.48 314.16 418.99 418.99 418.99
Equity Share Capital 189.26 313.48 314.16 418.99 418.99 418.99

E. RESERVE & SURPLUS

1 Statutory Reserve 1,219.61 1,250.05 1,314.81 1,396.47 1,463.67 1,463.67
2 Capital Reserve 305.08 311.19 315.65 397.06 529.69 529.69
3 Revaluation Reserve 401.53 395.12 387.66 1,267.12 1,253.11 1,246.45
4 Share Premium 868.05 2,217.81 2,224.42 2,906.66 2,906.66 2,906.66
5 Revenue & Other Reserve 914.69 962.89 1,098.79 1,189.20 1,108.44 1,108.44
Balance of Profit & Loss
6
Account - 20.45 21.87 - 21.74 -
TOTAL 3,708.96 5,157.51 5,363.20 7,156.51 7,283.31 7,254.91
Less: Revaluation Reserve 401.53 395.12 387.66 1,267.12 1,253.11 1,246.45
Less: Deferred Tax and
Intangible Assets 417.18 310.81 339.96 470.02 250.59 702.82
Less: Profit & Loss (Dr.) 57.52 - - 38.62 - 165.28
TOTAL (E) 2,832.73 4,451.58 4,635.58 5,380.75 5,779.61 5,140.36
NET WORTH (D+E) 3,021.99 4,765.06 4,949.74 5,799.74 6,198.60 5,559.35

The summary statement of assets and liabilities as restated should be read along with the accounting policy and
notes on accounts.

67
 Summary Statement of Restated Profit & Loss Account
(` in million)
Half Year
S Financial Year ended 31st March
Particulars Ended
No.
2010 2011 2012 2013 2014 30.09.2014
A. INCOME
1 Interest Earned 5,779.56 7,621.32 10,756.34 13,208.64 15,039.78 7,692.34
1.1 Interest & Discount on advance/bills 4,171.31 6,007.41 8,615.04 10,743.45 11,386.97 5,762.99
1.2 Income on Investment 1,413.12 1,553.24 2,008.63 2,262.59 3,304.09 1,862.06
Interest on balance with RBI & other
1.3
Inter Bank Funds 146.75 49.76 74.27 201.21 319.84 61.81
1.4 Interest on Others 48.38 10.91 58.40 1.39 28.88 5.48
2 OTHER INCOME 739.46 744.41 851.61 945.66 1,173.18 470.40
2.1 Commission, Exchange & Brokerage 200.28 166.26 173.03 162.60 166.93 94.70
2.2 Profit on sale of Investments(Net) 128.53 52.14 52.78 228.88 440.97 82.13
Profit on sale of land, building &
2.3
other assets (Net) (0.29) 5.33 12.27 4.57 0.88 (1.62)
2.4 Profit on exchange transaction(Net) 64.00 97.56 113.81 130.73 125.35 71.96
2.5 Miscellaneous Income 346.94 423.12 499.72 418.88 439.05 223.23
TOTAL INCOME 6,519.02 8,365.73 11,607.95 14,154.30 16,212.96 8,162.74
B. EXPENDITURE
1 Interest Expended 4,551.55 5,139.79 7,686.09 9,816.48 11,247.74 5,854.00
1.1 Interest on Deposits 4,460.44 4,963.09 7,380.10 9,502.27 10,942.40 5,661.42
Interest on RBI/Inter Bank
1.2
borrowings 0.33 31.74 65.93 73.43 115.32 111.83
1.3 Others 90.78 144.96 240.06 240.78 190.02 80.75
2 Operating Expenses 2,080.66 2,771.76 2,984.73 3,409.52 3,950.24 2,042.53
Payment to & provision for
2.1
employees 1,348.59 1,993.79 2,120.87 2,430.90 2,816.73 1,419.21
2.2 Rent, Tax & Lighting 214.47 230.11 255.06 323.41 383.84 202.81
2.3 Printing & Stationery 21.18 24.76 29.02 32.96 36.98 16.67
2.4 Advertisement & Publicity 7.66 13.14 24.28 18.11 10.77 5.25
Depreciation on Banks Properties (net
2.5 of amounts adjusted against
revaluation reserve) 107.71 104.25 85.37 74.40 73.47 53.13
Director's fees, allowances and
2.6
expenses 3.73 4.22 4.81 8.07 7.14 5.21
2.7 Auditor's Fees & Expenses 7.61 9.22 10.71 17.02 16.70 9.11
2.8 Law Charges 8.68 7.97 7.18 7.13 8.37 3.88
2.9 Postage, Telegrams, Telephones etc. 48.37 46.45 49.28 54.81 62.45 36.63
2.1 Repairs & Maintenance 50.82 58.79 59.15 60.10 61.15 34.96
2.11 Insurance 66.69 74.59 93.25 100.06 128.61 68.59
2.12 Other Expenditure 195.15 204.47 245.75 282.55 344.03 187.08
TOTAL EXPENDITURE 6,632.21 7,911.55 10,670.82 13,226.00 15,197.98 7,896.53
Operating Profit (before Extra
C. Ordinary Items and Provision &
Contingencies) Refer Anx A II (i) (113.19) 454.18 937.13 928.30 1,014.98 266.21
Add/(less): Extra Ordinary Items net
of taxes - - - - - -
Less: Provisions & Contingencies
(other than Provision for Tax) 84.66 161.58 640.09 600.84 546.00 542.33
D. Profit(Loss) Before Tax (197.85) 292.60 297.04 327.46 468.98 (276.12)
Provision for Tax (135.97) 92.87 36.60 61.29 159.52 (94.65)
E. Net Profit after tax, as restated (61.88) 199.73 260.44 266.17 309.46 (181.47)
Adjustment for Profit/ (Loss) Brought
Forward 21.01 (57.52) 20.45 21.87 (38.62) 21.74
Profit / (Loss) available for
F.
appropriation (40.87) 142.21 280.89 288.04 270.84 (159.73)
a) Statutory Reserve 4.13 30.44 64.76 81.67 67.20 -
b) Capital Reserve 3.61 6.11 4.46 81.40 132.63 -

68
 Half Year
S Financial Year ended 31st March
Particulars Ended
No.
2010 2011 2012 2013 2014 30.09.2014
c) General Reserve 0.60 11.59 76.63 13.23 15.78 -
d) Revenue & Other Reserve 8.16 36.62 57.81 77.18 (15.78) -
e) Charity Fund 0.15 0.30 0.30 0.30 0.30 -
f) Deferred Tax Liability - - - - - -
g) Dividend (excluding dividend tax) - 31.58 47.38 62.21 41.86 -
h) Tax on Dividend - 5.12 7.68 10.67 7.11 -
Adjustment of Depreciation as per
i)
Companies Act,2013 - - - - - 5.55
j) Balance of Profit carried forward (57.52) 20.45 21.87 (38.62) 21.74 (165.28)
TOTAL (40.87) 142.21 280.89 288.04 270.84 (159.73)
Break up of Provisions and
Contingencies
Provision for Non-Performing
Advances including Write Off 90.51 134.16 459.80 391.82 596.09 571.36
Add back of eligible amount of
provision held in respect of
Agricultural Debts Waived (1.47) (4.62) - - - -
Depreciation on Investments/(Written
Back) (14.59) 1.56 (5.12) 12.69 45.63 (22.71)
Provision for standard Advances - 36.86 109.04 126.69 (35.80) (1.95)
Provision for Diminution in
Restructured Advances 18.20 (4.80) 63.85 73.41 (66.02) (2.04)
Others (7.99) (1.58) 12.52 (3.77) 6.10 (2.33)
Provision for Contingencies (other
than Provision for tax) 84.66 161.58 640.09 600.84 546.00 542.33
Provision for Income Tax (135.97) 92.87 36.60 61.29 159.52 (94.65)
TOTAL (51.31) 254.45 676.69 662.13 705.52 447.68

The summary statement of restated profit and loss account should be read along with the accounting policy and
notes on accounts.

69
 Statement of Cash Flows as Restated
(` in million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
A. CASH FLOW FROM OPERATING
ACTIVITIES
Net Profit / (Loss) before Tax (197.85) 292.60 297.04 327.46 468.98 (276.12)
Adjustments for:
Depreciation on Fixed Assets 86.03 81.50 63.20 53.12 59.13 45.26
Amortisation of Intangible Assets 21.69 22.76 22.18 21.28 14.34 7.87
Provisions and Contingencies 84.66 161.58 640.09 600.84 546.00 542.33
Interest on Tier II Bonds 76.00 74.75 74.60 111.03 110.67 35.12
Others 154.20 56.55 23.73 71.29 (32.03) 2.72
Operating Profit before working capital
changes 224.73 689.74 1,120.84 1,185.02 1,167.09 357.18
Adjustments for
Deposits 6,455.22 17,473.19 18,792.01 17,367.55 13,322.36 4,916.41
Borrowings (0.55) 2,320.46 2,098.46 (3,600.59) 3,661.37 272.52
Other Liabilities 23.97 (177.57) 490.07 63.06 (29.54) (199.14)
Investments (1,039.83) (4,010.03) (4,543.77) (1,571.74) (18,351.64) 9.32
Advances (7,939.61) (17,660.29) (14,958.81) (12,345.00) 911.48 (8,217.02)
Other Assets 43.01 (64.32) (381.95) (503.09) (50.62) 208.36
Cash (used in) / generated from
Operating Activities (2,233.06) (1,428.82) 2,616.85 595.21 630.50 (2,652.37)
Direct Taxes Paid (Net of refunds) (25.36) 37.15 (146.94) 8.88 (95.97) 174.36
Net Cash (used in) / generated from
Operating Activities (A) (2,258.42) (1,391.67) 2,469.91 604.09 534.53 (2,478.01)
B. CASH FLOW FROM INVESTING
ACTIVITIES
Purchase of Fixed Assets and Intangible
Assets (66.90) (55.32) (91.13) (127.85) (159.96) (56.21)
Sale of Fixed Assets 1.70 3.64 16.43 2.29 2.38 1.05
Net Cash used in Investing Activities
(B) (65.20) (51.68) (74.70) (125.56) (157.58) (55.16)
C. CASH FLOW FROM FINANCING
ACTIVITIES
Proceeds from issue of Equity Share
Capital 0.47 124.22 0.68 104.83 - -
Proceeds from Share Premium 5.07 1,349.76 6.61 682.24 - -
Issue / (Redemption) of Tier II Bonds - (11.00) 418.00 (160.00) (100.01) (500.00)
Interest Paid on Tier II Bonds (76.00) (74.75) (74.60) (111.03) (110.67) (35.12)
Dividend paid (including Tax on Dividend
) (25.77) - (36.70) (54.49) (73.44) (48.96)
Net Cash generated / (used in) financing
activities (C) (96.23) 1,388.23 313.99 461.55 (284.12) (584.08)
D. NET INCREASE / (DECREASE) IN
CASH AND CASH EQUIVALENTS
(A+B+C) (2,419.85) (55.12) 2,709.20 940.08 92.83 (3,117.25)
Cash and Cash Equivalents at the
beginning of the Year 9,475.87 7,056.02 7,000.90 9,710.10 10,650.18 10,743.01
Cash and Cash Equivalents at the end of
the Year 7,056.02 7,000.90 9,710.10 10,650.18 10,743.01 7,625.76
Net increase / (decrease) disclosed as
above (2,419.85) (55.12) 2,709.20 940.08 92.83 (3,117.25)

The statement of cash flows as restated should be read along with the accounting policy and notes on accounts.

70
 THE ISSUE

The following table summarizes the Issue details:

Issue˄(1) [●] Equity Shares aggregating up to ` 4,000 million

Of which:

Employee Reservation Portion(2) [●] Equity Shares aggregating up to ` 100 million

Net Issue [●] Equity Shares aggregating up to ` 3,900 million

The Net Issue consists of:

A. QIB Portion(2) [●] Equity Shares
Of which:
Anchor Investor Portion* Not more than [●] Equity Shares
Net QIB Portion (assuming Anchor Investor [●] Equity Shares
Portion is fully subscribed)
Of which:
Mutual Fund Portion [●] Equity Shares
Balance for all QIBs including Mutual Funds [●] Equity Shares

B. Non-Institutional Portion(2) Not less than [●] Equity Shares

C. Retail Portion(2) Not less than [●] Equity Shares

Pre and post- Issue Equity Shares

Equity Shares outstanding prior to the Issue 60,337,625 Equity Shares
Equity Shares outstanding after the Issue [●] Equity Shares

Use of proceeds of this Issue See the section titled “Objects of the Issue” beginning at page
96.
˄
Our Bank, in consultation with the BRLMs, is considering a Pre-IPO Placemen of up to 12,500,000 Equity Shares for cash consideration
aggregating up to ` 1,500 million, at its discretion, prior to filing of the Red Herring Prospectus with the RoC ("Pre-IPO Placement"). If
the Pre-IPO Placement is completed, the number of Equity Shares issued pursuant to the Pre-IPO Placement will be reduced from the
Issue, subject to a minimum Net Issue size of 25% of the post Issue paid-up equity share capital being offered to the public.

*
Our Bank may, in consultation with the BRLMs, allocate up to 60% of the QIB Portion to Anchor Investors on a discretionary basis out of
which at least one-third will be available for allocation to domestic Mutual Funds only. For further details, see section titled “Issue
Procedure” beginning at page 367. In the event of under-subscription or non-Allotment in the Anchor Investor Portion, the balance Equity
Shares in the Anchor Investor Portion shall be added to the Net QIB Portion.
(1)
The Issue has been authorised by a resolution of our Board dated December 22, 2014 and by a special resolution of our
Shareholders at the EGM held on February 19, 2015.
(2)
Subject to valid Bids being received at or above the Issue Price, under-subscription, if any, in the Non-Institutional Portion
or the Retail Portion would be allowed to be met with spill-over from other categories or a combination of categories at the
discretion of our Bank, in consultation with the BRLMs and the Designated Stock Exchange. However, under-subscription,
if any, in the QIB Portion will not be allowed to be met with spill-over from other categories or a combination of categories.
Under-subscription, if any, in the Employee Reservation Portion will be added to the Net Issue. In case of under-
subscription in the Net Issue, spill-over to the extent of under-subscription shall be permitted to the Employee Reservation
Portion subject to the Net Issue constituting at least 25% of the fully diluted post-Issue paid up equity share capital of our
Bank.

71
 GENERAL INFORMATION

Our Bank was incorporated on November 26, 1920 under the Indian Companies Act, 1913 as ‘The Catholic Syrian
Bank Limited’. A fresh certificate of incorporation under the Companies Act, 1956 was issued by the Registrar of
Companies, Kerala at Ernakulum on April 14, 1987.

Registered Office

CSB Bhavan
Post Box No. 502, St. Mary’s College Road
Thrissur 680 020
Telephone: +91 487 2333 020/6451 640
Facsimile: +91 487 2333 170
Website: www.csb.co.in
Registration Number: 000175
Corporate Identity Number: U65191KL1920PLC000175

For details relating to changes in our Registered Office, see section titled “History and Certain Corporate Matters -
Changes in our Registered Office” at page 165.

Address of the Registrar of Companies

The Registrar of Companies is located at the following address:

The Registrar of Companies, Kerala

Registrar of Companies
Company Law Bhawan, BMC Road
Thrikkakara, Kochi 682 021
Kerala, India
Telephone: +91 484 2423 749/ 2421 489
Facsimile: +91 484 2422 327

Board of Directors

The following table sets out the details regarding our Board as on the date of this Draft Red Herring Prospectus:

Name, Designation and Occupation Age (years) DIN Address

Mr. S. Santhanakrishnan 64 00032049 No. 24, Unnamalai Ammai Street, T.
Nagar, Tamil Nadu, Chennai 600 017
Designation: Part-time Chairman; Non-executive
Director

Occupation: Practicing Chartered Accountant

Mr. Ajay Lal 53 00030388 No. 909 B, The Aralias, DLF Golf
Links, Gurgaon, Haryana 122 009
Designation: Non-executive Director

Occupation: Service and Consultancy

Mr. T. S. Anantharaman 66 00480136 27/376, Temple View, Chembukavu,
City Post Office, Kerala, Thrissur,
Designation: Non-executive Director 680 020

Occupation: Business
Mr. Bobby Jos C. 41 03270042 Chirakkekaran House, Bishop Palace
Road, East Fort, Kerala, Thrissur 680
Designation: Non-executive independent Director 005

72
 Name, Designation and Occupation Age (years) DIN Address
Occupation: Business
Mr. C. K. Gopinathan 60 01236752 Chittilangat Kalam, Koottanad P.O.,
Kerala, Palakkad 679 533
Designation: Non-executive Director

Occupation: Business
Mr. K. Subrahmanya Sarma 70 01505787 No. 8-2-677/B/1, Road No. 12,
Banjara Hills, Andhra Pradesh,
Designation: Non-executive Director Hyderabad 500 034

Occupation: Retired officer of the Indian

Administrative Services
Mr. Sumeer Bhasin 51 00952238 A-88, Defence Colony, New Delhi
110 024
Designation: Non-executive independent Director

Occupation: Service and Consultancy

Ms. Radha Unni 66 03242769 No. 21/6, Riverview, Fourth Main
Road, Gandhi Nagar, Adyar, Tamil
Designation: Non-executive independent Director Nadu, Chennai 600 020

Occupation: Retired Banker

Mr. S. Ramakrishnan 58 02255401 No. 1A, Sankaram, No. 11, Rani
Annadurai Street, Raja
Designation: Non-executive independent Director Annamalaipuram, Tamil Nadu,
Chennai 600 028
Occupation: Practicing Chartered Accountant
Mr. M. Madhavan Nambiar 64 03487311 No. 3, Nawab Habibullah Avenue,
Third Street, Tamil Nadu, Chennai
Designation: Non-executive independent Director 600 006

Occupation: Retired officer of the Indian

Administrative Services
Mr. K. Neethi Ragavan 58 06617935 Flat No. Q 206, Reserve Bank Staff
Quarters, P.H. Road, Tamil Nadu,
Designation: Additional Director - RBI Nominee Chennai 600 010

Occupation: General Manager, RBI, Chennai

Mr. V. G. Venkatachalapathy 53 07137366 No. 2, 10th Cross Street, Indira
Nagar, Adyar, Tamil Nadu, Chennai
Designation: Additional Director - RBI Nominee 600 020

Occupation: General Manager, Foreign Exchange

Department, RBI, Chennai

For further details and profile of our Directors, see section titled “Our Management” beginning at page 172.

Company Secretary and Compliance Officer

Mr. Sijo Varghese

Board & Shares Dept., CSB Bhavan
Post Box No. 502
St. Mary’s College Road
Thrissur 680 020
Kerala, India
Telephone: +91 487 6619 228
Facsimile: +91 487 2333 170
E-mail: [email protected]

73
Investors can contact the Compliance Officer and/or the Registrar to the Issue in case of any pre-Issue or post-Issue
related problems such as non-receipt of letters of Allotment, credit of Allotted Equity Shares in the respective
beneficiary account, non-receipt of refund orders or non-receipt of funds by electronic mode etc.

For all Issue related queries and for redressal of complaints, investors may also write to the BRLMs. All complaints,
queries or comments received by SEBI shall be forwarded to the BRLMs, who shall respond to the same.

All grievances relating to the non-ASBA process must be addressed to the Registrar to the Issue quoting the full
name of the Bidder, Bid cum Application Form number, Bidders’ DP ID, Client ID, PAN, number of Equity Shares
applied for, date of Bid cum Application Form, name and address of the Syndicate Member or the Registered Broker
where the Bid was submitted and cheque or draft number and issuing bank thereof.

All grievances relating to the ASBA process must be addressed to the Registrar to the Issue with a copy to the
SCSBs or the Syndicate Members if the bid was submitted to a member of Syndicate at any of the Specified
Locations, or the Registered Broker, as the case may be, giving full details such as name, address of the applicant,
number of Equity Shares applied for, Bid Amount blocked, ASBA Account number, Bidders’ DP ID, Client ID,
PAN and the Designated Branch of the SCSBs and the details of the Syndicate Bidding Centre where the bid cum
Application Form was submitted. All grievances relating to Bids submitted through the Registered Broker may be
addressed to the Stock Exchanges with a copy to the Registrar.

Chief Financial Officer

Mr. P.V. Antony

CSB Bhavan, Post Box No. 502
St. Mary’s College Road
Thrissur 680 020
Telephone: +91 487 6619 240
Facsimile: +91 487 2333 170
Email: [email protected]

Book Running Lead Managers

ICICI Securities Limited

ICICI Centre
H.T. Parekh Marg
Churchgate
Mumbai 400 020
Telephone: +91 22 2288 2460
Facsimile: +91 22 2282 6580
Email ID: [email protected]
Website: www.icicisecurities.com
Investor grievance email: [email protected]
Contact Person: Harsh Soni / Payal Kulkarni / Vishal Kanjani
SEBI Registration No.: INM000011179

Kotak Mahindra Capital Company Limited

27 BKC, 1st Floor, Plot No. C-27

‘G’ Block, Bandra Kurla Complex
Bandra (East)
Mumbai 400 051
Telephone: +91 22 4336 0000
Facsimile: +91 22 6713 2447
Email: csb.ipo @kotak.com

74
Investor grievance email: [email protected]
Website: www.investmentbank.kotak.com
Contact Person: Ganesh Rane
SEBI Registration No.: INM000008704

Syndicate Members

[●]

Legal Counsel to the Bank as to Indian Law

Luthra & Luthra Law Offices

9th Floor, Ashoka Estate
Barakhamba Road
New Delhi 110 001
Telephone: +91 11 4121 5100
Facsimile: +91 11 2372 3909

Legal Counsel to the BRLMs as to Indian Law

Khaitan & Co.

One Indiabulls Centre
13th Floor, Tower 1
841 Senapati Bapat Marg
Mumbai 400 013
Telephone: +91 22 6636 5000
Facsimile: +91 22 6636 5050

Registrar to the Issue

Link Intime (I) Private Limited

C-13, Pannalal Silk Mills Compound
L.B.S. Marg, Bhandup (West)
Mumbai 400 078
Telephone: +91 22 617 15400
Facsimile: +91 22 2596 0329
E-mail: [email protected]
Investor Grievance ID: [email protected]
Website: www.linkintime.co.in
Contact Person: Sachin Achar
SEBI Registration No.: INR000004058

Escrow Collection Banks

[●]

Refund Banker(s)

[●]

Self Certified Syndicate Banks

The list of banks which are registered with SEBI under the Securities and Exchange Board of India (Bankers to an
Issue) Regulations, 1994 and offer services in relation to ASBA, including blocking of an ASBA Account in
accordance with the SEBI Regulations, is available on

75
http://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/Recognised-Intermediaries and updated from time to time, or at
such other website as may be prescribed by SEBI from time to time.

Registered Brokers

Bidders can submit Bid cum Application Forms in the Issue to Registered Brokers at the Non Syndicate Broker
Centres. For further details, see section titled “Issue Procedure” beginning at page 367.

Joint Statutory Central Auditors to our Bank

Sundaram & Srinivasan, Chartered Accountants

New No. 4, Old No. 23
C.P Ramaswamy Road
Alwarpet
Chennai 600 018
Telephone: +91 44 2498 8762/ 2498 8463
Facsimile: +91 44 2498 8463
E-mail: [email protected]
Website: www.sundaramandsrinivasan.com
Contact Person: C. Naresh
Membership No.: 028684

Varma & Varma, Chartered Accountants

Building No.53/333, A,B,C & D
Off. Subash Chandra Bose Road
Opp Reliance Fresh Shop, Vytilla
Kochi 682 019
Telephone: +91 487 2335 347/233 5394/230 1596
Facsimile: +91 487 2322 889
E-mail: [email protected]/[email protected]
Website: www.varmaandvarma.com
Contact Person: C. Pankajakshan
Membership No.: 012948

Statement of Responsibilities of the BRLMs

The responsibilities of the BRLMs for various activities in this Issue are as follows.

Sr. Activities Responsibility Coordinator

No.
1. Capital structuring with the relative components and formalities such as I-Sec, Kotak I-Sec
composition of debt and equity, type of instruments, size of issue, allocation
between primary and secondary, etc.
2. Due diligence of the Company’s operations/ management/ business plans/ legal I-Sec, Kotak I-Sec
etc. Drafting and design of the Draft Red Herring Prospectus, Red Herring
Prospectus and Prospectus. The BRLMs shall ensure compliance with stipulated
requirements and completion of prescribed formalities with the Stock Exchanges,
RoC and SEBI including finalization of Prospectus and RoC filing of the same,
follow up and coordination till final approval from all regulatory authorities,
3. Drafting and approval of statutory advertisement and application forms I-Sec, Kotak I-Sec
4. Drafting and approval of other publicity material including non-statutory I-Sec, Kotak Kotak
advertisement, corporate advertisement, brochure, etc.
5. Appointment of all other intermediaries (e.g. Registrar(s), Printer(s) and Banker(s) I-Sec, Kotak I-Sec
to the Issue, Advertising agency etc.)
6. International Institutional Marketing; allocation of investors for meetings and I-Sec, Kotak I-Sec
finalizing road show schedules and preparation and finalization of the road-show
presentation and FAQs

76
 Sr. Activities Responsibility Coordinator
No.
7. Domestic Institutional Marketing (including banks/ mutual funds); allocation of I-Sec, Kotak Kotak
investors for meetings and finalizing road show schedules
8. Non-Institutional & Retail Marketing of the Issue, which will cover, inter alia, I-Sec, Kotak Kotak
 Formulating marketing strategies, preparation of publicity budget
 Finalizing Media and PR strategy
 Finalizing centres for holding conferences for brokers etc.
 Finalizing collection centres; and
 Follow-up on distribution of publicity and Issue material including form,
prospectus and deciding on the quantum of the Issue material
9. Pricing and managing the book I-Sec, Kotak I-Sec
10. Coordination with Stock-Exchanges for book building software, bidding terminals I-Sec, Kotak Kotak
etc.
11. Post-issue activities, which shall involve essential follow-up steps including I-Sec, Kotak Kotak
follow-up with bankers to the issue and Self Certified Syndicate Banks to get
quick estimates of collection and advising the issuer about the closure of the issue,
based on correct figures, finalization of the basis of allotment or weeding out of
multiple applications, listing of instruments, dispatch of certificates or demat credit
and refunds and coordination with various agencies connected with the post-issue
activity such as registrars to the issue, bankers to the issue, Self-Certified
Syndicate Banks etc. Including responsibility for underwriting arrangements, as
applicable.
The designated coordinating BRLM shall also be responsible for coordinating the
redressal of investor grievances in relation to post issue activities and coordinating
with Stock Exchanges and SEBI for Release of 1% security deposit post closure of
the issue

Monitoring Agency

In terms of the proviso to Regulation 16(1) of the SEBI Regulations, our Bank is not required to appoint a
monitoring agency for this Issue.

Expert

Our Bank has not obtained any expert opinions, other than the consents from the Auditors, M/s. Sundaram &
Srinivasan, Chartered Accountants and M/s. Varma & Varma, Chartered Accountants to include their names as
experts under Section 26 of the Companies Act, 2013 in this Draft Red Herring Prospectus in relation to their reports
on the restated audited financial statements as on and for Fiscals 2010, 2011, 2012, 2013 , 2014 and the six months
ended September 30, 2014 and statement of special tax benefits.

Project Appraisal

The objects of this Issue have not been appraised.

Credit Rating

As this is an issue of equity shares, credit rating is not required.

Trustees

As this is an issue of equity shares, the appointment of trustees is not required.

Book Building Process

“Book building” refers to the process of collection of Bids from investors on the basis of the Red Herring
Prospectus, the Bid cum Application Forms, Revision Forms and the ASBA Forms. The Issue Price shall be

77
determined by our Bank, in consultation with the BRLMs, after the Bid Closing Date. The principal parties involved
in the Book Building Process are:

(1) our Bank;

(2) the BRLMs;
(3) Syndicate Members who are intermediaries registered with SEBI and eligible to act as underwriters;
(4) Registered Brokers
(5) Registrar to the Issue;
(6) Escrow Collection Banks; and
(7) SCSBs.

This Issue is being made through the Book Building Process, wherein 50% of the Net Issue shall be available for
allocation on a proportionate basis to QIBs.

Our Bank may, in consultation with the BRLMs, allocate up to 60% of the QIB Portion to Anchor Investors on a
discretionary basis at the Anchor Investor Allocation Price, out of which at least one-third will be available for
allocation to domestic Mutual Funds only. For further details, see section titled “Issue Procedure” on page 367.
Allocation to Anchor Investors shall be on a discretionary basis subject to minimum number of two Anchor
Investors. An Anchor Investor shall make a minimum Bid of such number of Equity Shares that the Bid Amount is
at least ` 100 million. In the event of under-subscription or non-Allotment in the Anchor Investor Portion, the
balance Equity Shares in the Anchor Investor Portion shall be added to the Net QIB Portion.

Such number of Equity Shares representing 5% of the Net QIB Portion shall be available for allocation on a
proportionate basis to Mutual Funds only. The remainder of the Net QIB Portion shall be available for allocation on
a proportionate basis to QIBs, subject to valid Bids being received from them at or above the Issue Price. In the
event that the demand from Mutual Funds is greater than Equity Shares representing 5% of the Net QIB Portion,
allocation shall be made to Mutual Funds proportionately, to the extent of the Mutual Fund Portion. The remaining
demand by the Mutual Funds shall, as part of the aggregate demand by QIBs, be available for allocation
proportionately out of the remainder of the Net QIB Portion, after excluding the allocation in the Mutual Fund
Portion. However, in the event of under-subscription in the Mutual Fund Portion, the balance Equity Shares in the
Mutual Fund Portion will be added to the Net QIB Portion and allocated to QIBs (including Mutual Funds) on a
proportionate basis, subject to valid Bids at or above Issue Price.

Further, not less than 15% of the Net Issue shall be available for allocation on a proportionate basis to Non-
Institutional Bidders and not less than 35% of the Net Issue shall be available for allocation to Retail Individual
Bidders in accordance with SEBI Regulations, subject to valid Bids being received at or above the Issue Price, such
that subject to availability of Equity Shares, each Retail Individual Bidder shall be allotted not less than the
minimum Bid Lot, and the remaining Equity Shares, if available, shall be allotted to all Retail Individual Bidders on
a proportionate basis. Under-subscription in any category, if any, would be allowed to be met with spill-over from
any other category or combination of categories at the discretion of our Bank in consultation with the BRLMs and
the Designated Stock Exchange, on a proportionate basis. However, under-subscription, if any, in the QIB Portion
will not be allowed to be met with spill over from other categories or a combination of categories. Under-
subscription, if any, in the Employee Reservation Portion will be added to the Net Issue. In case of under-
subscription in the Net Issue, spill-over to the extent of under-subscription shall be permitted to the Employee
Reservation Portion subject to the Net Issue constituting at least 25% of the fully diluted post-Issue paid up equity
share capital of our Bank.

Further, QIBs (except Anchor Investors) and NIIs can participate in the Issue only through the ASBA mechanism.

In accordance with the SEBI Regulations Anchor Investors cannot withdraw their Bids after the Anchor
Investor Bidding Period. Further, allocation to QIBs in the Net QIB Portion will be on a proportionate basis.
QIBs and NII’s cannot withdraw or lower their Bids (in terms of quantity of Equity Shares or the Bid
Amount) at any stage after bidding and are required to pay the Bid Amount upon submission of the Bid. For
further details, see sections titled “Issue Structure” and “Issue Procedure” on pages 362 and 367 respectively.

Our Bank will comply with the SEBI Regulations and any other ancillary directions issued by SEBI for this Issue. In

78
this regard, our Bank has appointed the BRLMs to manage this Issue and procure subscriptions to this Issue.

The Book Building Process is subject to change. Bidders are advised to make their own judgment about an
investment through this process prior to submitting a Bid.

Steps to be taken by the Bidders for Bidding:

 Check eligibility for making a Bid. Specific attention of ASBA Bidders is invited to section titled “Issue
Procedure” on page 367;
 Ensure that you have an active demat account and the demat account details are correctly mentioned in the Bid
cum Application Form or the ASBA Form, as the case may be;
 Ensure that the Bid cum Application Form or ASBA Form is duly completed as per the instructions given in the
Red Herring Prospectus and in the respective forms;
 Except for bids on behalf of the Central or State Government and the officials appointed by the courts and by
investors residing in the state of Sikkim, for Bids of all values ensure that you have mentioned your PAN
allotted under the IT Act in the Bid cum Application Form and the ASBA Form (see section titled “Issue
Procedure” on page 367). The exemption for the Central or State Government and the officials appointed by
the courts and for investors residing in the State of Sikkim is subject to the Depository Participants’ verifying
the veracity of such claims of the investors by collecting sufficient documentary evidence in support of their
claims;
 Bids by QIBs (except Anchor Investors) and NIIs shall be submitted only through the ASBA process.
 Ensure the correctness of your Demographic Details such as the address, the bank account details for printing
on refund orders and occupation, given in the Bid cum Application Form or ASBA Form, with the details
recorded with your Depository Participant;
 Ensure the correctness of your PAN, DP ID and Client ID given in the Bid cum Application Form and the
ASBA Form. Based on these parameters, the Registrar will obtain details of the Bidders from the Depositories
including the Bidder’s name, bank account number etc.
 ASBA Bidders can submit their Bids by submitting Bid cum Application Forms, either in physical or electronic
mode, to the SCSB with whom the ASBA Account is maintained or in physical form to the Syndicate, the sub-
Syndicate or the Registered Brokers. ASBA Bidders should ensure that their bank accounts have adequate
credit balance at the time of submission to the SCSB to ensure that their ASBA Form is not rejected; and
 Non-ASBA Bidders may submit their Bids with a member of the Syndicate or any of the Registered Brokers of
the Stock Exchange.

For further details, see section titled “Issue Procedure” on page 367.

Illustration of Book Building Process and the Price Discovery Process

(Investors should note that the following is solely for the purpose of illustration and is not specific to this Issue)

Bidders can Bid at any price within the Price Band. For instance, assuming a price band of ` 20 to ` 24 per share, an
offer size of 3,000 equity shares and receipt of five bids from bidders, details of which are shown in the table below.
A graphical representation of the consolidated demand and price would be made available at the Bidding Centres
during the bidding period. The illustrative book as shown below indicates the demand for the shares of the issuer
company at various prices and is collated from bids from various investors.

Bid Quantity Bid Price (`) Cumulative Quantity Subscription

500 24 500 16.67%
1,000 23 1,500 50.00%
1,500 22 3,000 100.00%
2,000 21 5,000 166.67%
2,500 20 7,500 250.00%

The price discovery is a function of demand at various prices. The highest price at which the issuer is able to offer
the desired number of shares is the price at which the book cuts off, i.e., ` 22 in the above example. Our Bank, in

79
consultation with the BRLMs, will finalise the offer price at or below such cut-off, i.e., at or below ` 22. All bids at
or above the offer price and cut-off price are valid bids and are considered for allocation in the respective categories.

Underwriting Agreement

After the determination of the Issue Price, but prior to filing of the Prospectus with the RoC, our Bank intends to
enter into the Underwriting Agreement with the Underwriters and the Registrar to the Issue for the Equity Shares
proposed to be offered through the Issue. It is proposed that pursuant to the terms of the Underwriting Agreement,
the Underwriters shall be responsible for bringing in the amount devolved in the event the respective Syndicate
Members do not fulfil their underwriting obligations. The underwriting shall be to the extent of the Bids uploaded,
subject to Regulation 13 of the SEBI Regulations. Pursuant to the terms of the Underwriting Agreement, the
obligations of the Underwriters are several and are subject to certain conditions specified therein.

The Underwriting Agreement is dated [●]. The Underwriters have indicated their intention to underwrite the
following number of Equity Shares:

(This portion has been intentionally left blank and will be completed before filing of the Prospectus with the RoC.)

Details of the Underwriters Indicated Number of Equity Shares to Amount Underwritten

be Underwritten (In ` million)
[●] [●] [●]
[●] [●] [●]
[●] [●] [●]
Total [●] [●]

The above-mentioned amount is indicative and will be finalised after determination of the Issue Price and
finalization of the ‘Basis of Allotment’ and subject to Regulation 13(2) of the SEBI Regulations.

In the opinion of our Board (based on a certificate given by the Underwriters), the resources of the Underwriters are
sufficient to enable them to discharge their respective underwriting obligations in full. The above-mentioned
underwriters are registered with SEBI under Section 12(1) of the SEBI Act or registered as brokers with the Stock
Exchanges. Our Board, at its meeting held on [●], has accepted and entered into the Underwriting Agreement on
behalf of our Bank.

Allocation among the Underwriters may not necessarily be in the proportion of their underwriting commitments set
forth in the table above. Notwithstanding the above table, the Underwriters shall be severally responsible for
ensuring payment with respect to the Equity Shares allocated to investors procured by them. In the event of any
default in payment, the respective Underwriter, in addition to other obligations to be defined in the Underwriting
Agreement, will also be required to procure subscription for or subscribe to Equity Shares to the extent of the
defaulted amount in accordance with the Underwriting Agreement.

The underwriting arrangements mentioned above shall not apply to the subscriptions by the ASBA Bidders in the
Issue, except for ASBA Bids procured by the Syndicate Member(s). The underwriting agreement shall list out the
role and obligations of each Syndicate Member, and inter alia contain a clause stating that margin collected shall be
uniform across all categories indicating the percentage to be paid as margin by the investors at the time of Bidding.

80
 CAPITAL STRUCTURE

The equity share capital of our Bank, as of the date of this Draft Red Herring Prospectus, is set forth below:

(In ` million, except share data)

Aggregate nominal Aggregate value at
value Issue Price
A) AUTHORISED SHARE CAPITAL
120,000,000 Equity Shares of ` 10 each 1,200.00 -

B) ISSUED, SUBSCRIBED AND PAID UP SHARE CAPITAL

BEFORE THE ISSUE
60,337,625 Equity Shares of ` 10 each 603.38 [●]

C) PRESENT ISSUE IN TERMS OF THIS DRAFT RED HERRING

PROSPECTUS**
Public issue of up to [●] Equity Shares 4,000.00 [●]

Of which

(a) EMPLOYEE RESERVATION PORTION

[●] Equity Shares 100.00

(b) NET ISSUE

[●] Equity Shares 3,900.00

D) ISSUED, SUBSCRIBED AND PAID UP SHARE CAPITAL AFTER

THE ISSUE
[●] Equity Shares [●] [●]
E) SECURITIES PREMIUM ACCOUNT
Before the Issue 4,466.18
After the Issue* [●]
______
*
The securities premium account will be determined after determination of the Issue Price.
**
Our Bank, in consultation with the BRLMs, is considering the Pre-IPO Placement of up to 12,500,000 Equity Shares for cash consideration
aggregating up to ` 1,500 million, at its discretion, prior to filing of the Red Herring Prospectus with the RoC. If the Pre-IPO Placement is
completed, the number of Equity Shares issued pursuant to the Pre-IPO Placement will be reduced from the Issue, subject to a minimum Net
Issue size of 25% of the post Issue paid-up equity share capital being offered to the public.

(a) Provided below are details of changes in our authorised share capital since incorporation.

(i) From incorporation till the financial year ended December 31, 1961

We have been unable to trace corporate resolutions and filings in relation to changes in our authorised
share capital from incorporation till the financial year ended December 31, 1961. Accordingly,
disclosures in relation to changes in our authorised share capital from our incorporation to the financial
year ended December 31, 1961 have been made in reliance of (i) our memorandum of association filed
with the Registrar of Companies at the time of our incorporation; and (ii) our audited balance sheets
comprised in our Annual Reports from the financial year ended December 31, 1949 till the financial
year ended December 31, 1961. See the section titled “Risk Factors - Some of our corporate records,
including records on allotments of our equity shares in the past are not traceable” on page 20.

S no. As on Authorised capital

1. November 26, 1920 The initial authorised share capital of our Bank at incorporation stood at ` 0.5
million divided into 5,000 equity shares of face value of ` 100 each.
2. December 31, 1949 The authorised share capital of our Bank stood increased from ` 0.5 million
divided into 5,000 equity shares of face value of ` 100 each to ` 2 million
divided into 20,000 equity shares of face value of ` 100 each.

81
 S no. As on Authorised capital
3. December 31, 1961 The authorised share capital of our Bank stood increased from ` 2 million
divided into 20,000 equity shares of face value of ` 100 each to ` 10 million
divided into 100,000 equity shares of face value of ` 100 each.

(ii) From the financial year ended December 31, 1961 till date

Disclosures in relation to changes in our authorised share capital from the financial year ended
December 31, 1961 till date have been made in reliance of (i) our audited balance sheets comprised in
our Annual Reports from the financial year ended December 31, 1961 till the financial year ended
March 31, 1990, such balance sheets evidencing no change in the authorised share capital of our Bank
in this period; and (ii) board and shareholder resolutions and filings with the RoC from the financial
year ended March 31, 1990 till date. See the section titled “Risk Factors – Some of our corporate
records, including records on allotments of our equity shares in the past are not traceable” on page
20.

S no. Date of shareholder’s Particulars

resolution
1. September 19, 1990 The authorised share capital of our Bank was increased from ` 10 million
divided into 100,000 equity shares of face value of ` 100 each to ` 100
million divided into 1,000,000 equity shares of face value of ` 100 each.
2. September 29, 1992 The authorised share capital of our Bank was increased from ` 100
million divided into 1,000,000 equity shares of face value of ` 100 each to
` 1,000 million divided into 100,000,000 Equity Shares of face value of `
10 each.
3. September 25, 1998 The authorised share capital of our Bank was changed from ` 1,000
million divided into 100,000,000 Equity Shares of face value of ` 10 each
to ` 1,000 million divided into 80,000,000 equity shares of face value of `
10 each and 2,000,000 preference shares of face value of ` 100 each. An
aggregate of un-issued 20,000,000 Equity Shares of ` 10 each were
cancelled, and 2,000,000 preference shares of face value of ` 100 each
were created in lieu thereof, as part of the authorised share capital of our
Bank.
4. September 28, 2012 The authorised share capital of our Bank was changed from ` 1,000
million divided into 80,000,000 Equity Shares of face value of ` 10 each
and 2,000,000 preference shares of face value of ` 100 each to ` 1,200
million divided into 100,000,000 Equity Shares of face value of ` 10 each
and 2,000,000 preference shares of face value of ` 100 each.
5. February 19, 2015 The authorised share capital of our Bank was changed from ` 1,200
million divided into 100,000,000 Equity Shares of face value of ` 10 each
and 2,000,000 preference shares of face value of ` 100 each to ` 1,200
million divided into 120,000,000 Equity Shares of face value of ` 10 each,
by reclassification of 2,000,000 preference shares of face value of ` 100
each to 20,000,000 Equity Shares of ` 10 each.

(b) The Issue has been authorized by a resolution of our Board dated December 22, 2014, and by a special
resolution passed by our shareholders pursuant to Section 62(1)(c) of the Companies Act, 2013 at an EGM
held on February 19, 2015.

(c) Our Bank may, in consultation with the BRLMs, allocate up to 60% of the QIB Portion to Anchor Investors
on a discretionary basis at the Anchor Investor Allocation Price, out of which at least one-third will be
available for allocation to domestic Mutual Funds only. For further details, see the section titled “Issue
Procedure” on page 367. In the event of under-subscription or non-Allotment in the Anchor Investor Portion,
the balance Equity Shares in the Anchor Investor Portion shall be added to the QIB Portion.

(d) Such number of Equity Shares representing 5% of the Net QIB Portion shall be available for allocation on a
proportionate basis to Mutual Funds only. The remainder of the Net QIB Portion shall be available for
allocation on a proportionate basis to QIBs (including Mutual Funds), subject to valid Bids being received

82
 from them at or above the Issue Price. In the event that the demand from Mutual Funds is greater than 5% of
the Net QIB Portion, allocation shall be made to Mutual Funds proportionately, to the extent of the Mutual
Fund Portion. The remaining demand by the Mutual Funds shall, as part of the aggregate demand by QIBs, be
available for allocation proportionately out of the remainder of the Net QIB Portion, after excluding the
allocation in the Mutual Fund Portion. However, in the event of under-subscription in the Mutual Fund
Portion, the balance Equity Shares in the Mutual Fund Portion will be added to the Net QIB Portion and
allocated to QIBs on a proportionate basis, subject to valid Bids at or above Issue Price.

Notes to Capital Structure

1. Share Capital History

a) Share capital history of our Bank from incorporation to the financial year ended December 31, 1982

We have been unable to trace corporate resolutions and filings in relation to changes in our issued, subscribed
and paid up equity share capital from incorporation till the financial year ended December 31, 1982.
Accordingly, disclosures in relation to changes in our issued, subscribed and paid up equity share capital from
our incorporation to the financial year ended December 31, 1982 have been made in reliance of (i) our
memorandum of association filed with the Registrar of Companies at the time of our incorporation in 1920;
and (ii) our audited balance sheets comprised in our Annual Reports from the financial year ended December
31, 1945 till the financial year ended December 31, 1982. See the section titled “Risk Factors – Some of our
corporate records, including records on allotments of our equity shares in the past are not traceable” on
page 20.

The table below profiles all increases or decreases in the cumulative number of equity shares of our Bank (as
at the end of the relevant fiscal where such increase or decrease occurred) and corresponding changes to the
cumulative paid up equity share capital of our Bank from its incorporation till the financial year ended
December 31, 1982. The cumulative paid up equity share capital of our Bank has undergone changes on a
regular basis on account of payment by shareholders of pending amounts called up on equity shares
previously issued by our Bank until May 2, 2012 (wherein all existing Equity Shares in respect of which call
monies were pending, were forfeited). Consequently, the cumulative equity share capital of our Bank may
have changed in the financial years not mentioned in the table below (without any corresponding increase or
decrease in cumulative number of equity shares allotted).

As on Cumulative number of Face value Cumulative paid-up share

equity shares (`) capital (`)
November 26, 1920 490 100 49,000
December 31, 1945 4,757 100 216,320(1)
December 31, 1949 9,757 100 362,325(2)
December 31, 1958 15,000 100 614,750(3)
December 31, 1960 20,000 100 841,490(4)
December 31, 1962 30,000 100 1,444,475(5)
December 31, 1965 29,140(6) 100 1,465,355(7)
December 31, 1966 29,096(8) 100 1,465,355(9)
December 31, 1967 30,000 100 1,500,000(10)
December 31, 1982 30,000 100 2,957,740(11)
(1)
An amount of ` 50 per share was called up on 3,133 equity shares of ` 100 each and an amount of ` 40 per share was called upon on
1,624 shares of ` 100 each, of which ` 5,290 was unpaid as on December 31, 1945.
(2)
An amount of ` 50 per share was called up on 4,757 equity shares of ` 100 each and an amount of ` 25 per share was called upon on
5,000 shares of ` 100 each, of which ` 525 was unpaid as on December 31, 1949.
(3)
An amount of ` 50 per share was called up on 9,757 equity shares of ` 100 each and an amount of ` 25 per share was called upon on
5,243 shares of ` 100 each, of which ` 4,175 was unpaid as on December 31, 1958.
(4)
An amount of ` 50 per share was called up on 15,000 equity shares of ` 100 each and an amount of ` 20 per share was called upon
on 5,000 shares of ` 100 each, of which ` 8,510 was unpaid as on December 31, 1960.
(5)
An amount of ` 50 per share was called up on 30,000 equity shares of ` 100 each, of which ` 55,525 was unpaid as on December 31,
1962.
(6)
860 equity shares of ` 100 each were forfeited and cancelled in the financial year ended December 31, 1965.
(7)
An amount of ` 50 per share was called up on 29,140 equity shares of ` 100 each, of which ` 1,610 was unpaid as on December 31,
1965.

83
 (8)
44 equity shares of ` 100 each were forfeited and cancelled in the financial year ended December 31, 1966.
(9)
An amount of ` 50 per share was called up on 29,096 equity shares of ` 100 each.
(10)
An amount of ` 50 per share was called up on 30,000 equity shares of ` 100 each.
(11)
An amount of ` 100 per share was called up on 30,000 equity shares of ` 100 each, of which ` 42,260 was unpaid as on December
31, 1982.

b) History of equity share capital of our Bank from the financial year ended December 31, 1982 till date

Disclosures in relation to changes in our issued, subscribed and paid up equity share capital from the financial
year ended December 31, 1982 till date have been made in reliance of (i) our audited balance sheets
comprised in our Annual Reports from the financial year ended December 31, 1982 till the financial year
ended March 31, 2012 (ii) resolutions of our Board of Directors and the associated board agendas from the
financial year ended December 31, 1982 till the financial year ended March 31, 1991, and (iii) resolutions of
our Board of Directors and the associated board agendas and filings made with the Registrar of Companies
from the financial year ended March 31, 1992 till date. See the section titled “Risk Factors – Some of our
corporate records, including records on allotments of our equity shares in the past are not traceable” on
page 20.

The cumulative paid up equity share capital of our Bank has undergone changes on a regular basis on account
of payment by shareholders of pending amounts called up on equity shares previously issued by our Bank
until May 2, 2012 (wherein all existing Equity Shares on which call monies were pending were forfeited).
Consequently (from the financial year ended December 31, 1983 till the financial year ended March 31, 2012)
the cumulative equity share capital of our Bank has been disclosed as at the end of each financial year
wherein there was a change in the cumulative number of equity shares allotted by our Bank.

Disclosures on the paid cumulative equity share of our Bank made in reliance of our audited balance sheets
from Fiscal 1992 till Fiscal 2012 are subject to rounding off.

Date of Number of Face Issue Nature of Reasons for Cumulative Cumulative

allotment equity value Price per Consideration allotment number of paid-up equity
shares (`) equity equity shares share capital
share allotted (`)
(`)
December 6,000 100 100 Cash Rights issue(1) 36,000 -
7, 1983
December - - - - - 36,000 3,119,720(2)
31, 1983
November 6,000 100 100 Cash Rights issue (3) 42,000 -
7, 1984
December - - - - - 42,000 3,805,800(4)
31, 1984
October 9, 8,000 100 100 Cash Rights issue (5) 50,000 -
1985
December - - - - - 50,000 4,957,065(6)
31, 1985
August 19, 10,000 100 100 Cash Rights issue(7) 60,000 -
1987
December - - - - - 60,000 5,904,035(8)
31, 1987
September 10,000 100 100 Cash Rights issue(9) 70,000 -
14, 1988
March 31, - - - - - 70,000 6,906,100(10)
1989
March 28, 8,122 100 100 Cash Rights issue 78,122 -
1990 (“1989 Rights
Issue”)(11)
March 31, - - - - - 78,122(12) 7,180,145(12)
1990
November 6,878 100 100 Cash Allotment of 85,000 -
28, 1990 additional

84
 Date of Number of Face Issue Nature of Reasons for Cumulative Cumulative
allotment equity value Price per Consideration allotment number of paid-up equity
shares (`) equity equity shares share capital
share allotted (`)
(`)
equity shares to
existing
shareholders of
our Bank who
had applied for
additional
shares in the
1989 Rights
Issue(13)
March 31, - - - - - 85,000 9,100,745(14)
1991
April 10, 30,000 100 100 Cash Rights issue(15) 115,000 -
1991
August 14, 30,000 100 100 Cash Rights issue(16) 145,000 -
1991
January 8, 33,000 100 100 Cash Rights issue(17) 178,000 -
1992
March 31, - - - - - 178,000 17,209,000(18)
1992
June 25, 37,000 100 100 Cash Rights issue(19) 215,000 -
1992
215,000 equity shares of face value of ` 100 of our Bank were sub-divided into 2,150,000 equity shares of face value of
` 10 of our Bank pursuant to the resolution of our shareholders at an AGM held on September 29, 1992.
January 13, 2,415,475 10 10 Cash Rights issue 4,565,475 -
1993 (“1992 Rights
Issue”)(20)
155,431 10 10 Cash Preferential 4,720,906 -
allotment to
employees
January 27, 592,279 10 10 Cash Allotment of 5,313,185 -
1993 renounced
rights
entitlements in
the 1992 Rights
Issue to
renouncees and
unaccepted
rights
entitlements in
the 1992 Rights
Issue to
shareholders
who had
applied for
additional
shares (21)
March 31, - - - - - 5,313,185 43,549,000(22)
1993
October 20, 100,866 10 10 Cash Allotment of 5,414,051 -
1993 renounced
rights
entitlements
and the
unsubscribed
portion of the
1992 Rights

85
 Date of Number of Face Issue Nature of Reasons for Cumulative Cumulative
allotment equity value Price per Consideration allotment number of paid-up equity
shares (`) equity equity shares share capital
share allotted (`)
(`)
Issue to
existing
shareholders of
our Bank(23)
March 31, - - - - - 5,414,051 52,709,000(24)
1994
January 27, 5,233,624 10 32 Cash Rights issue 10,647,675 -
1999 (“1998 Rights
Issue”)(25)
March 23, 54,682 10 32 Cash Allotment 10,702,357 -
1999 pursuant to
receipt of
complete
applications in
respect of
certain
erstwhile
incomplete
applications
received in the
1998 Rights
Issue(26)
March 31, - - - - - 10,702,357 99,981,000(27)
1999
November 177,298 10 32 Cash Allotment of 10,879,655 -
3, 1999 additional
equity shares to
existing
shareholders of
our Bank who
had applied for
additional
shares in the
1998 Rights
Issue(28)
March 31, - - - - - 10,879,655 105,202,000(29)
2000
July 27, 1,752,467 10 190 Cash Preferential 12,632,122 -
2007 allotment

March 31, - - - - - 12,632,122 125,403,000(30)

2008
August 12, 3,214,104 10 32 Cash Allotment of 15,846,226 -
2008 Equity Shares
offered in the
1998 Rights
Issue and kept
in abeyance, to
existing
shareholders of
our Bank (31)
February 15,583,147 10 120 Cash Rights issue 31,429,373 -
12, 2009 (“2008 Rights
Issue”)(32)
March 31, - - - - - 31,429,373 188,790,000(33)
2009

86
 Date of Number of Face Issue Nature of Reasons for Cumulative Cumulative
allotment equity value Price per Consideration allotment number of paid-up equity
shares (`) equity equity shares share capital
share allotted (`)
(`)
January 15, 149,714 10 120 Cash Allotment of 31,579,087 -
2010 Equity Shares
offered in the
2008 Rights
Issue and kept
in abeyance to
existing
shareholders of
our Bank(34)
March 31, - - - - - 31,579,087 189,259,000(35)
2010
May 2, (219,520) 10 - - Forfeiture of 31,359,567 313,595,670(36)
2012 Equity Shares
on account of
non-payment of
pending call
monies on
Equity Shares
November 25,777 10 - - Annulment of 31,385,344 313,853,440
8, 2012(37) the forfeiture of
Equity Shares
effected on
May 2, 2012,
on account of
the subsequent
payment by
shareholders of
allotment/ call
monies in
arrears along
with interest
March 30, 10,461,781 10 75 Cash Rights issue(38) 41,847,125 418,471,250
2013

October 14, 3,406,094 10 180 Cash Preferential 45,253,219 452,532,190

2014 allotment
March 27, 15,084,406 10 75 Cash Rights issue(39) 60,337,625 603,376,250
2015
_________
(1)
Rights issue of 6,000 equity shares of ` 100 to existing shareholders of our Bank in the ratio of one equity share for every five equity
shares of face value ` 100 each held.
(2)
An amount of ` 100 per share was called up on 30,000 equity shares of ` 100 each and an amount of ` 20 per share was called upon
on 6,000 shares of ` 100 each, of which ` 280 was unpaid as on December 31, 1983.
(3)
Rights issue of 6,000 equity shares of ` 100 to existing shareholders of our Bank in the ratio of one equity share for every six equity
shares of face value ` 100 held.
(4)
An amount of ` 100 per share was called up on 36,000 equity shares of ` 100 each and an amount of ` 40 per share was called upon
on 6,000 equity shares of ` 100 each, of which ` 34,200 was unpaid as on December 31, 1984.
(5)
Rights issue of 8,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
five equity shares of face value ` 100 held.
(6)
An amount of ` 100 per share was called up on 50,000 equity shares of ` 100 each, of which ` 42,935 was unpaid as on December 31,
1985.
(7)
Rights issue of 10,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
five equity shares of face value ` 100 held.
(8)
An amount of ` 100 per share was called up on 60,000 equity shares of ` 100 each, of which ` 95,965 was unpaid as on December 31,
1987.
(9)
Rights issue of 10,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
six equity shares of face value ` 100 held.

87
(10)
An amount of ` 100 per share was called up on 70,000 equity shares of ` 100 each, of which ` 93,900 was unpaid as on March 31,
1989 (the financial year ended March 31, 1989 was fifteen months long in light of our Bank changing the duration of its financial year)
(11)
Rights issue of 15,000 equity shares of face value of ` 100 each to existing shareholders of our Bank in the ratio of one equity share
for every five equity shares of face value ` 100 held, of which 8,122 equity shares of face value ` 100 were allotted.
(12)
An amount of ` 100 per share was called up on 70,000 equity shares of ` 100 each, and ` 25 per share was called up on 8,122 equity
shares of ` 100 each, of which ` 22,905 was unpaid as on March 31, 1990. Our Bank also received share application money for 6,878
equity shares of face value of ` 100 each as additional equity shares offered in the 1989 Rights Issue. However, allotment of these shares
was not made in light of a pending suit that had been filed challenging the allotment of the additional equity shares. Consequently, share
application money for the aforementioned shares was not reflected in the audited balance sheet of our Bank for the financial year ended
March 31, 1990. Upon the suit being decided in favour of our Bank, allotment of the 6,878 additional shares was made on November 28,
1990. See note (13) below.
(13)
Allotment of 6,878 equity shares of face value ` 100 to existing shareholders of our Bank who had applied for additional equity shares
in the 1989 Rights Issue.
(14)
An amount of ` 100 per share was called up on 85,000 equity shares of ` 100 each, of which ` 154,430 was unpaid as on March 31,
1991. Further, application amounts of ` 755,175 for issuance of 30,000 equity shares of ` 100 each had been received by our Bank as on
March 31, 1991, and included in the paid up share capital of our Bank for Fiscal 1991, for which shares were allotted on April 10, 1991.
(15)
Rights issue of 30,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
three equity shares of face value ` 100 held.
(16)
Rights issue of 30,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
three equity shares of face value of ` 100 held.
(17)
Rights issue of 33,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
four fully paid up equity shares of face value ` 100 held.
(18)
An amount of ` 100 per share was called up on 178,000 equity shares of ` 100 each, of which ` 591,000 was unpaid as on March 31,
1992.
(19)
Rights issue of 37,000 equity shares of face value ` 100 to existing shareholders of our Bank in the ratio of one equity share for every
five fully paid up equity shares of face value ` 100 held.
(20)
Rights issue of 3,108,620 Equity Shares to existing shareholders of our Bank in the ratio of (i) one Equity Share for every nine Equity
Shares held by shareholders holding 10 Equity Shares; (ii) two Equity Shares for every eight Equity Shares held by shareholders holding
20 Equity Shares; (iii) three Equity Shares for every seven Equity Shares held by shareholders holding 30 Equity Shares; (iv) four Equity
Shares for every six Equity Shares held by shareholders holding 40 Equity Shares; and (v) one Equity Share for one Equity Share held by
shareholders holding 50 Equity Shares or more, of which 2,415,475 Equity Shares were allotted.
(21)
Allotment of 280,810 Equity Shares to renouncee applicants in the 1992 Rights Issue, and 311,469 Equity Shares to existing
shareholders of our Bank who had applied for additional shares.
(22)
An amount of ` 10 per share was called up on 4,720,906 Equity Shares and an amount of ` 7.50 per share was called up on 592,279
Equity Shares, of which ` 8,357,000 was unpaid as on March 31, 1993. Further, application amounts of ` 225,000 for issuance of
100,866 Equity Shares had been received by our Bank as on March 31, 1993 and included in the paid up share capital of our Bank for
Fiscal 1993, for which shares were allotted on October 20, 1993.
(23)
Allotment of 100,866 Equity Shares to existing shareholders of our Bank in lieu of renounced rights entitlement and the unsubscribed
portion of the 1992 Rights Issue. The allotment was made pursuant to receipt of approval of the RBI by its letter dated September 15,
1993 which was required given that the allottees either held, or after such allotment, would hold more than 1% of the equity share
capital of our Bank.
(24)
An amount of ` 10 per share was called up on 4,720,906 Equity Shares and an amount of ` 7.50 per share was called up on 592,279
Equity Shares, of which ` 1,431,000 was unpaid as on March 31, 1994.
(25)
Rights issue of 8,121,076 Equity Shares with an option to retain oversubscription of 12% of the offer (pursuant to approval by the RBI
for such retention of oversubscription by its letter dated January 12, 1999) to existing shareholders of our Bank in the ratio of three
Equity Shares for every two Equity Shares held by existing shareholders of our Bank, of which 5,233,624 Equity Shares were allotted.
(26)
Allotment of 54,682 Equity Shares to existing shareholders of our Bank upon submission of completed application forms for applying
in the 1998 Rights Issue.
(27)
An amount of ` 10 per share was called up on 10,647,675 Equity Shares, and an amount of ` 2.50 per Equity Share was called up on
54,682 Equity Shares, of which ` 6,632,000 was unpaid as on March 31, 1999.
(28)
Allotment of 177,298 Equity Shares to existing shareholders of our Bank in lieu of the additional shares pursuant to the 1998 Rights
Issue. Prior to the allotment, our Bank had made an application to the RBI for its acknowledgement for this allotment given that the
allottees either held, or after such allotment, would hold more than 1% of the equity share capital of our Bank. Subsequently, the RBI, by
its circular dated September 21, 1999, clarified that allotments/ transfers of equity shares in an Indian bank which would result in the
allottees/ transferees holding 5% or more of its equity share capital would require acknowledgement by the RBI. Further, the RBI, by its
letter dated October 11, 1999, clarified to our Bank that the current allotment would not require acknowledgement by the RBI given that
the allotment did not breach the 5% threshold, subsequent to which this allotment was made.
(29)
An amount of ` 10 per share was called up on 10,879,655 Equity Shares, of which ` 3,595,000 was unpaid as on March 31, 2000.
(30)
An amount of ` 10 per share was called up on 12,632,122 Equity Shares, of which ` 918,000 was unpaid as on March 31, 2008.
(31)
Allotment of 3,214,104 Equity Shares to existing shareholders of our Bank that were offered in the 1998 Rights Issue and kept in
abeyance pursuant to the requirements of section 205A of the Companies Act, 1956. The Equity Shares kept in abeyance represented
Equity Shares arising out of rights entitlements on 2,142,736 Equity Shares, which had been lodged for transfer by their transferees and
such transfer pending the approval of the RBI. Upon receipt of the approval of the RBI by its letter dated November 28, 2007 for such
transfer, the transferees were allotted 3,214,104 Equity Shares forming part of the 1998 Rights Issue, through an additional letter of
offer dated July 24, 2008.
(32)
Rights issue of 15,583,147 Equity Shares to existing shareholders of our Bank in the ratio of one Equity Share for every one Equity
Share held by existing shareholders of our Bank.
(33)
An amount of ` 10 per share was called up on 15,846,226 Equity Shares and an amount of ` 2 per share was called up on 15,583,147
Equity Shares, of which ` 838,000 was unpaid as on March 31, 2009.

88
 (34)
Allotment of 149,714 Equity Shares to existing shareholders of our Bank that were offered in the 2009 Rights Issue and kept in
abeyance pursuant to the requirements of section 205A of the Companies Act, 1956. The Equity Shares kept in abeyance represented
Equity Shares arising out of rights entitlements on 149,714 Equity Shares, which had been lodged for transfer by their transferees and
such transfer pending the approval of the RBI. Upon receipt of the approval of the RBI by its letter dated August 11, 2009 for such
transfer, the transferees were allotted 149,714 Equity Shares forming part of the 2008 Rights Issue, through an additional letter of offer
dated December 15, 2009.
(35)
An amount of ` 10 per share was called up on 31,579,087 Equity Shares, of which ` 810,000 was unpaid and ` 125,722,000 was
called up but not due as on March 31, 2010.
(36)
In addition to the forfeiture, the difference between the cumulative paid up equity share capital of our Bank from March 31, 2010 to
May 2, 2012 was primarily on account of payments on a call of Equity Shares allotted in the 2008 Rights Issue that was made in Fiscal
2012.
(37)
No separate allotment of these Equity Shares was made, and the forfeiture in respect of these 25,777 Equity Shares was annulled.
(38)
Rights issue of 10,461,781 Equity Shares to existing shareholders of our Bank in the ratio of one Equity Share for every three Equity
Shares held by existing shareholders of our Bank.
(39)
Rights issue of 15,084,406 Equity Shares to existing shareholders of our Bank in the ratio of one Equity Share for every three Equity
Shares held by existing shareholders of our Bank.

c) Equity shares issued for consideration other than cash

No equity shares have been issued by our Bank for consideration other than cash since Fiscal 1982.

d) Equity Shares issued at a price which may be lower than the Issue Price during the preceding one year

Our Bank has made the following allotments of Equity Shares during preceding one year from the date of
filing this Draft Red Herring Prospectus, which could be at a price lower than the Issue Price.

Date of allotment Name of the Allottee No. of Equity Issue Price Reasons for allotment
Shares (`)
October 14, 2014 Mr. C.K. Gopinathan 920,000 180 Preferential allotment
Mr. Sat Pal Khattar 355,430 180 Preferential allotment
Mr. Anand Krishnamurthy 333,333 180 Preferential allotment
Mr. Alok Oberoi 273,000 180 Preferential allotment
Angus Capital LLC 627,333 180 Preferential allotment
Acumen Capital Market (India) 125,000 180 Preferential allotment
Limited
Mr. Yusuff Ali M.A. 172,000 180 Preferential allotment
Plant Lipids (P) Limited 388,888 180 Preferential allotment
Vikram Kundur Reddy 55,555 180 Preferential allotment
Mr. Nilesh Navlakha 55,555 180 Preferential allotment
Mr. Ravi Mehrotra and Ms. Renuka 100,000 180 Preferential allotment
Mehrotra
March 27, 2015 Existing shareholders of our Bank* 15,084,406 75 Rights issue in the
ratio 1:3
*
Since the allotment was made to various existing shareholders of our Bank, the allottees have not been disclosed individually.

2. Details of Lock-in

a) Details of share capital locked in for three years

Our Bank is a professionally managed company and has no identifiable promoter. Accordingly, as per
Regulation 34(a) of the SEBI Regulations, the requirement of promoters’ contribution and lock-in is not
applicable to the Issue.

b) Details of share capital locked in for one year

The entire pre- Issue equity share capital of our Bank shall be locked- in for a period of one year from the
date of Allotment other than:

(i) the Equity Shares held by a VCF or a category I AIF or an FVCI, and which have been locked-in for a
period of at least one year from the date of purchase by such entity; and

89
 (ii) the Equity Shares, if any, held pursuant to allotment under the ESOS 2013 by persons who are
employees of our Bank as on the date of Allotment.

c) Lock in of Equity Shares to be Allotted, if any, to the Anchor Investors

Equity Shares allotted to Anchor Investors, if any, under the Anchor Investor Portion shall be locked-in for a
period of 30 days from the date of Allotment.

d) Other requirements in respect of lock-in

The Equity Shares under lock-in may be transferred to any other person holding Equity Shares which are
locked-in along with the Equity Shares proposed to be transferred, subject to continuation of the lock-in in the
hands of the transferee for the remaining period and compliance with the Takeover Regulations, as
applicable.

3. Our shareholding pattern

a) The table below represents the shareholding pattern of our Bank as on March 27, 2015:

Description Pre-Issue Post Issue*

Category of Shareholder Number Total number Number of Total Shares pledge Total Total Shares pledge
of of Equity shares held in shareholdin or otherwise number shareholdin or otherwise
shareholder Shares dematerialize g as a % of encumbered# of Equi g as encumbered
s d form total Numb As a ty a % of total Number As a
number of er of % Shares number of of %
Equity shares Equity shares
Shares Shares
(A+B)
Shareholding of Promoters - - - - - - - - - -
and Promoter Group (A)
Indian - - - - - - - - - -
Individuals/ Hindu Undivided - - - - - - - - - -
Family
Central Government/ State - - - - - - - - - -
Government (s)
Bodies Corporate - - - - - - - - - -
Financial Institutions/ Banks - - - - - - - - - -
Any Other (Under Trust) - - - - - - - - - -
Foreign - - - - - - - - - -
Individuals (Non-Resident - - - - - - - - - -
Individuals/Foreign
Individuals)
Bodies Corporate (OCBs) - - - - - - - - - -
Institutions/FII - - - - - - - - - -
Any Other - - - - - - - - - -
Total Shareholding of - - - - - - - - - -
Promoters and Promoter
Group (A)
Public shareholding (B)
Institutions (B)(1)
Mutual Funds/ UTI - - - - - - [●] [●] - -
Financial Institutions / `Banks 1 2,785,661 2,785,661 4.62 - [●] [●] - -
Central Government/State - - - - - - [●] [●] - -
Government(s)
Foreign Portfolio Investors - - - - - - [●] [●] - -
Foreign Venture Capital - - - - - - [●] [●] - -
Investor
Venture Capital Fund - - - - - - [●] [●] - -
Insurance Companies - - - - - - [●] [●] - -
Sub-Total (B)(1) 1 2,785,661 2,785,661 4.62 - - [●] [●] - -
Non-institutions (B)(2) [●] [●] - -
Bodies Corporate 113 16,385,446 15,094,825 27.16 - - [●] [●] - -
Non Resident Indians 40 11,265,768 2,261,211 18.67 - - [●] [●] - -
OCBs - - [●] [●] - -
Trust 4 265,144 0 0.44 - - [●] [●] - -

90
 Description Pre-Issue Post Issue*
Category of Shareholder Number Total number Number of Total Shares pledge Total Total Shares pledge
of of Equity shares held in shareholdin or otherwise number shareholdin or otherwise
shareholder Shares dematerialize g as a % of encumbered# of Equi g as encumbered
s d form total Numb As a ty a % of total Number As a
number of er of % Shares number of of %
Equity shares Equity shares
Shares Shares
(A+B)
Individuals 25,399 19,728,155 8,915,544 32.70 - - [●] [●] - -
+Foreign Bodies 3 6,256,179 0 10.37 - - [●] [●] - -
Others 42 3,651,272 3,583,489 6.05 - - [●] [●] - -
Sub-Total (B)(2) 25,601 57,551,964 29,855,069 95.38 - - [●] [●] - -
Public shareholding - - - - - - [●] [●] - -
pursuant to the Issue (B)(3)
Total Public Shareholding 25,602 60,337,625 32,640,730 100 - - [●] [●] - -
(B) = (B)(1)+(B)(2)+B(3)
(C) Shares held by - - - - - - [●] [●] - -
custodians and against
which Depository receipts
have been issued
Promoter and Promoter Group - - - - - - [●] [●] - -
Public - - - - - - [●] [●] - -
GRAND TOTAL 25,602 60,337,625 32,640,730 100 - - [●] [●] - -
(A)+(B)+(C)
______
*
Based on the assumption that such shareholders shall continue to hold the same number of Equity Shares after this Issue. This does not include
any Equity Shares that such shareholders may Bid for and be Allotted.
#
Given that a large number of shareholders hold Equity Shares in physical form, we are unable to ascertain whether such Equity Shares have
been pledged. None of our outstanding Equity Shares that are in dematerialised form are pledged.

4. Shareholding of Directors and Key Management Personnel

Other than as set forth below, none of our Directors or Key Management Personnel hold Equity Shares as on
the date of filing this Draft Red Herring Prospectus.

S. Name No. of Equity Shares Percentage of

No. shareholding (%)
Directors
1. Mr. S. Santhanakrishnan 9,066 0.02
2. Mr. C. K. Gopinathan 2,370,724 3.93
3. Mr. Bobby Jos C. 18,156 0.03
4. Mr. T.S. Anantharaman 331,520 0.55
5. Mr. Sumeer Bhasin 27,000 0.05
6. Mr. K. Subrahmanya Sarma 10,730 0.02
Key Management Personnel
1. Mr. Anand Krishnamurthy 444,444 0.74
2. Sekhar Rao 666 Negligible
3. Thomas K. George 500 Negligible
4. Mr. Mohan Menon T. 420 Negligible
5. Mr. Kurian George 4,000 0.01
6. Mr. Ajith Prabhakar 1,000 Negligible
7. Mr. Bharath Mani 666 Negligible
8. Mr. M.P. Davies 2,400 Negligible
9. Mr. P.V. Antony 533 Negligible

5. Public shareholders holding more than 1% of the pre-Issue paid-up capital of our Bank

Details of the public shareholders holding more than 1% of the pre-Issue paid-up Equity Share capital of our
Bank and their pre-Issue and post-Issue shareholding percentage are as follows:

S. Name Pre-Issue Post-Issue

91
 No. No. of Equity Percentage of No. of Equity Percentage of
Shares shareholding Shares shareholding
(%) (%)
1. Mr. Yusuff Ali M A 3,007,722 4.98 [●] [●]
2. The Federal Bank Limited 2,785,661 4.62 [●] [●]
3. A T Invofin India Private 4.14 [●] [●]
2,498,229
Limited
4. Mr. C.K. Gopinathan 2,370,724 3.93 [●] [●]
5. AIF Capital Development 3.46 [●] [●]
2,085,393
Limited
6. GPE III Mouritius Direct 3.46 [●] [●]
2,085,393
Investment Limited
7. Siguler Guff Bric Mauritius 2,085,393 3.46 [●] [●]
8. Agnus Capital LLP 2,081,854 3.45 [●] [●]
9. Edelweiss Finance & 3.17 [●] [●]
1,913,452
Investments Limited
10. Anitha P.V 1,841,801 3.05 [●] [●]
11. Lal Arakulath Sankappa 1,756,908 2.91 [●] [●]
12. Thomas John Muthoot 1,665,633 2.76 [●] [●]
13. Miss Amornthip Chansri Chawla 1,622,924 2.69 [●] [●]
14. Way2Wealth Securities Limited 1,555,214 2.58 [●] [●]
15. JPT Securities Limited 1,531,897 2.54 [●] [●]
16. Mr. Surachan Chansri Chawla 1,362,582 2.26 [●] [●]
17. Alok Knit Exports Private 1.78 [●] [●]
Limited 1,073,316
18. Mr. Gurdist Chansri Chawla 1,022,633 1.69 [●] [●]
19. Edelweiss Commodities Services 1.45 [●] [●]
Limited 874,814
20. ACG Associated Capsules 1.14 [●] [●]
Private Limited 689,266
21. P-Cube Enterprises Private 1.07 [●] [●]
Limited 648,000
Total 36,558,809 60.59 [●] [●]

6. Employee stock option and stock purchase schemes

Our shareholders by a resolution passed through postal ballot and e-voting, the results of which were declared
on August 18, 2014 approved the ESOS 2013, and the grant/ issuance of options to eligible employees of our
Bank, such that the offer, issue and allotment of Equity Shares pursuant to the option does not exceed 5% of
the issued Equity Shares of our Bank at any point of time. The ESOS 2013 will be administered by the
Nomination and Remuneration Committee (formerly, the Remuneration and Compensation Committee) of
our Board of Directors. The ESOS 2013 scheme is currently not in compliance with the Securities and
Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.

The Remuneration and Compensation Committee of the Board of Directors and the Board of Directors,
through their resolutions dated April 8, 2014, and our shareholders, through a special resolution passed by
postal ballot and e-voting, the results being declared on August 18, 2014, approved the grant of 836,943 stock
options under ESOS 2013 to Mr. Rakesh Bhatia, our former MD & CEO. We had applied to the RBI for its
approval for grant of these stock options to Mr. Bhatia. Pending approval from the RBI, Mr. Bhatia resigned
from his position as MD & CEO of our Bank.

As on the date of this Draft Red Herring Prospectus, no options have been granted under ESOS 2013. Our
Bank may, during the period of filing of this Draft Red Herring Prospectus till listing of the Equity Shares
offered in the Issue, grant options under ESOS 2013 to certain of its employees.

7. Top 10 shareholders

As on March 27, 2015, our Bank has 25,602 shareholders. The list of the principal shareholders of our Bank

92
 and the number of Equity Shares held by them is provided below:

(a) Our top 10 shareholders and the number of Equity Shares held by them, as on March 27, 2015, are as follows:

S. No. Shareholder No. of Equity Shares Pre-Issue %

1. Mr. Yusuff Ali M A 3,007,722 4.98
2. The Federal Bank Limited 2,785,661 4.62
3. A T Invofin India Private Limited 2,498,229 4.14
4. Mr. C. K. Gopinathan 2,370,724 3.93
5. AIF Capital Development Limited 2,085,393 3.46
6. GPE III Mouritius Direct Investment Limited 2,085,393 3.46
7. Siguler Guff Bric Mauritius 2,085,393 3.46
8. Agnus Capital LLP 2,081,854 3.45
9. Edelweiss Finance & Investments Limited 1,913,452 3.17
10. Ms. Anitha P.V 1,841,801 3.05
Total 22,755,622 37.71

(b) Our top 10 shareholders and the number of Equity Shares held by them 10 days prior to March 27, 2015
(March 18, 2015) were as follows:

S. No. Shareholder No. of Equity Shares Pre Issue %

1. Mr. Yusuff Ali M A 2,255,792 4.98
2. The Federal Bank Limited 2,089,246 4.62
3. AIF Capital Development Limited 2,085,393 4.61
4. GPE III Mouritius Direct Investment Limited 2,085,393 4.61
5. Siguler Guff Bric Mauritius 2,085,393 4.61
6. Edelweiss Finance & Investments Limited 1,913,452 4.23
7. A T Invofin India Private Limited 1,873,672 4.14
8. Mr. C. K. Gopinathan 1,778,043 3.93
9. Amornthip Chansri Chawla 1,622,924 3.59
10. Way2Wealth Securities Private Limited 1,555,214 3.44
Total 19,344,522 42.75

(c) Our top ten shareholders and the number of Equity Shares held by them two years prior to March 27, 2015
(March 27, 2013) were as follows:

S. No. Shareholder No. of Equity Shares Pre Issue %

1. Edelweiss Finance & Investments Limited 2,091,200 4.99
2. The Federal Bank Limited 2,089,246 4.99
3. AIF Capital Development Limited 2,085,393 4.98
4. GPE III Mouritius Direct Investment Limited 2,085,393 4.98
5. Siguler Guff Bric Mauritius 2,085,393 4.98
6. A T Invofin India Private Limited 1,873,672 4.48
7. Amornthip Chansri Chawla 1,622,924 3.88
8. Way2Wealth Securities Private Limited 1,555,214 3.72
9. JPT Securities Limited 1,531,897 3.66
10. Mr. Surachan Chansri Chawla 1,362,582 3.26
Total 18,382,914 43.93

8. Sale, purchase or subscription of our Bank’s securities by our Directors aggregating to 1% or more of
the pre-Issue capital within the last three years

The details of sale, purchase or subscription of our Bank’s securities by our Directors within three years
immediately preceding the date of this Draft Red Herring Prospectus, which in aggregate is equal to or greater
than 1% of the pre-Issue capital of our Bank are as follows:

93
 Name of Director Date of Number of Pre-Issue Face Issue Nature of
allotment/ Equity Shares % value Price transaction
transfer (`) (`)
Mr. C. K. Gopinathan October 14, 2014 920,000 1.52 10 180 Preferential
Issue

9. Our Bank, our Directors, the BRLMs have not entered into any buy-back and/or standby and/or any other
similar arrangements for the purchase of Equity Shares being offered through this Issue.

10. The BRLMs and their associates do not hold any Equity Shares as on the date of filing of this Draft Red
Herring Prospectus.

11. Other than allotments pursuant to the ESOS 2013 and the Pre-IPO Placement, there will be no further issue of
Equity Shares whether by way of issue of bonus shares, preferential allotment, rights issue or in any other
manner during the period commencing from submission of this Draft Red Herring Prospectus with SEBI until
the Equity Shares offered through the Red Herring Prospectus have been listed on the Stock Exchanges or
until the application moneys are refunded on account of non-listing, under subscription etc.

12. Our Bank has not issued Equity Shares out of its revaluation reserves.

13. Other than the options granted under the ESOS 2013 described above, there are no outstanding warrants,
options or rights to convert debentures, loans or other instruments into the Equity Shares as on the date of this
Draft Red Herring Prospectus.

14. Since Fiscal 1982, our Bank has not allotted any Equity Shares pursuant to any scheme approved under
sections 391 to 394 of the Companies Act, 1956.

15. The Equity Shares are fully paid-up and there are no partly paid-up Equity Shares as on the date of filing of
this Draft Red Herring Prospectus.

16. Our Bank has not made any public issue of any kind or class of securities since its incorporation.

17. Our Bank does not have any intention, proposal, negotiations or consideration to alter its capital structure by
way of split /consolidation of the denomination of the Equity Shares, or issue of Equity Shares on a
preferential basis or issue of bonus or rights or further public issue of shares or any other securities, within a
period of six months from the Bid Opening Date, except allotment of Equity Shares pursuant to options under
the ESOS 2013 that may vest and be exercised in this period.

18. None of our Directors or their immediate relatives have purchased or sold any securities of our Bank, during a
period of six months preceding the date of filing this Draft Red Herring Prospectus with SEBI.

19. During the period of six months immediately preceding the date of filing of this Draft Red Herring
Prospectus, no financing arrangements existed whereby our Directors or their relatives may have financed the
purchase of Equity Shares by any other person, other than in the normal course of the business of such
financing entity.

20. Any oversubscription to the extent of 10% of the Issue can be retained for the purpose of rounding off to the
nearest multiple of the minimum Allotment lot.

21. The Equity Shares issued pursuant to this Issue shall be fully paid-up at the time of Allotment, failing which
no Allotment shall be made.

22. There shall be only one denomination of the Equity Shares, unless otherwise permitted by law.

23. In the event of under-subscription in the Retail Portion or the Non-Institutional Portion in the Issue, the
unsubscribed portion would be allowed to be met with spill over from any other category or a combination of

94
 categories at the sole discretion of our Bank, in consultation with the BRLMs. Under-subscription, if any, in
the Employee Reservation Portion shall be added to the Net Issue. In case of under-subscription in the Net
Issue, spill-over to the extent of under-subscription shall be permitted under the Employee Reservation
Portion. Such inter-se spill-over, if any, would be effected in accordance with applicable laws, rules,
regulations and guidelines. However, undersubscription, if any, in the QIB Portion will not be allowed to be
met with spill-over from any category or combination thereof.

24. No payment, direct or indirect in the nature of discount, commission, and allowance or otherwise shall be
made either by us to the persons who receive Allotments.

25. Our Bank shall comply with such disclosure and accounting norms as may be specified by SEBI from time to
time.

95
 OBJECTS OF THE ISSUE

Objects of the Issue

The objects of the Issue are to augment our Bank’s Tier-I capital base to meet our Bank’s future capital requirements
which are expected to arise out of growth in our Bank’s assets, primarily our Bank’s loans/advances and investment
portfolio and to ensure compliance with Basel III and other RBI guidelines. Further, the proceeds from the Issue will
be used towards meeting the expenses of the Issue.

In addition, our Bank expects to receive the benefits of listing the Equity Shares on the Stock Exchanges.

Utilization of the proceeds of the Issue

The details of the proceeds of the Issue are summarized below:

Particulars Estimated Amount (` million)

Issue Proceeds 4,000
Less Issue related expenses* [●]
Net Proceeds (Issue Proceeds less the Issue related expenses) [●]
* Will be incorporated after finalization of the Issue Price.

The Banking Regulation Act and our Memorandum of Association enable us to undertake our existing activities and
the activities for which the funds are being raised by our Bank in the Issue.

Requirement and sources of funds

We intend to utilize the entire Net Proceeds to augment our Bank’s Tier-I capital base to meet our Bank’s future
capital requirements which are expected to arise out of growth in our Bank’s assets, primarily our Bank’s
loans/advances and investment portfolio and to ensure compliance with Basel III and other RBI guidelines.

Details of the Objects

Augment our Bank’s Tier-I capital base to meet our Bank’s future capital requirements which are expected to arise
out of growth in our Bank’s assets, primarily our Bank’s loans/advances and investment portfolio and to ensure
compliance with Basel III and other RBI guidelines

As prescribed by the RBI, our Bank has adopted Basel III starting from April 1, 2013. The minimum capital
adequacy ratio (“CRAR”) required to be maintained by our Bank for Fiscal 2015 is 9.625%, with Tier-I CAR of
7%. As on September 30, 2014, our CRAR, Tier 1 Capital and Tier 2 Capital was 9.87%, 7.96% and 1.91%
respectively as per Basel – II, and 9.72%, 7.87% and 1.85%, respectively as per Basel – III.

Basel III is being implemented by RBI from April 1, 2013 is subject to a series of transitional arrangements to be
phased in over a period of time and will be fully implemented on March 31, 2019. The RBI has indicated that the
capital requirements for the implementation of the RBI Basel III Capital Regulations may be lower during the initial
period and higher in later years. While our Bank has raised capital from time to time, with adoption of Basel III by
our Bank and the ongoing implementation of BASEL III by RBI, the minimum capital requirements of our Bank
will increase in a phased manner over the next few years.

Accordingly, the objects of the Issue are to augment our Bank’s Tier-I capital base to meet our Bank’s future capital
requirements which are expected to arise out of growth in our Bank’s assets, primarily our Bank’s loans/advances
and investment portfolio and to ensure compliance with Basel III and other RBI guidelines.

Schedule of Implementation and Deployment of Funds

The Bank proposes to deploy the Net Proceeds in the aforesaid object in the Fiscal 2016.

96
Appraisal of the Objects

The objects have not been appraised by any banks, financial institutions or agency and we have not raised any
bridge loans against the Net Proceeds.

Means of Finance

The entire requirements of the objects detailed above are intended to be funded from the Net Proceeds. Accordingly,
we confirm that there is no need for us to make firm arrangements of finance through verifiable means towards at
least 75% of the stated means of finance, excluding the amount to be raised through the Issue.

Issue Expenses

The Issue related expenses consist of fees payable to the BRLMs, underwriting commission, brokerage and selling
commission, commission payable to Registered Brokers, SCSBs’ fees, Escrow Banks’ and Registrar’s fees, printing
and stationery expenses, advertising and marketing expenses and all other incidental and miscellaneous expenses for
listing the Equity Shares on the Stock Exchanges. The total expenses of the Issue are estimated to be approximately
` [●] million.

The break-down for the Issue expenses is as follows:

S. Activity Expense Amount* Percentage of Total Percentage of

No. (` in million) Estimated Issue Issue Size*
Expenses*
1. Fees of the BRLMs, underwriting commission, [●] [●] [●]
brokerage and selling commission (including
commissions to SCSBs for ASBA Applications) and
Commission payable to Registered Brokers
2. Processing fee to the SCSBs for processing Bid cum [●] [●] [●]
Application Forms procured by Syndicate/Sub
Syndicate and submitted to SCSBs or procured by
Registered Brokers**
3. Advertising and marketing expenses, printing and [●] [●] [●]
stationery, distribution, postage etc.
4. Fees to the Registrar to the Issue [●] [●] [●]
5. Listing fees and other regulatory expenses [●] [●] [●]
6. Other expenses (Legal advisors, Auditors and other [●] [●] [●]
Advisors etc.)
Total Estimated Issue Expenses [●] [●] [●]
*
To be completed after finalisation of the Issue Price
**
SCSBs would be entitled to a processing fee of ` [●] per Bid cum Application Form, for processing the Bid cum Application Forms procured by the members of the
Syndicate and submitted to SCSBs.

Monitoring of Utilization of Funds

As we are a bank, in accordance with Regulation 16 of the SEBI Regulations, there is no requirement for
appointment of a monitoring agency. Hence details of utilization of the Net Proceeds will not be separately disclosed
in our financial statements.

Other Confirmations

No part of the Net Proceeds will be paid by our Bank as consideration to our Directors and Key Management
Personnel, except in the ordinary course of business.

97
We further confirm that the amount raised by our Bank through the Issue shall not be used for buying, trading or
otherwise dealing in equity shares of any other listed company.

In accordance with Section 27 of the Companies Act, 2013, a company shall not vary the objects of the issue, unless
authorised by its shareholders in a general meeting by way of a special resolution. Additionally, the notice in respect
of such resolution issued to the shareholders shall contain details as prescribed under the Companies Act, 2013 and
such details of the notice, clearly indicating the justification for such variation, shall also be published in one
English and one vernacular newspaper in the city where the registered office of the company is situated, as per the
Companies Act, 2013 and the rules framed there under. Pursuant to the Companies Act, 2013, the controlling
shareholders of such company are required to provide an exit opportunity to the shareholders who do not agree to
such proposal to vary the objects, in accordance with the articles of association, and as may otherwise be prescribed
by SEBI.

98
 BASIS FOR ISSUE PRICE

The Issue Price will be determined by our Bank in consultation with the BRLMs, on the basis of assessment of
market demand for the Equity Shares through the Book Building Process and on the basis of quantitative and
qualitative factors as described below. The face value of the Equity Shares is ` 10 each and the Issue Price is [●]
times the face value at the lower end of the Price Band and [●] times the face value at the higher end of the Price
Band.

Qualitative Factors

Some of the qualitative factors which form the basis for the Issue Price are:

 Strong and trusted brand in south India;

 Focus on the SME business;
 Retail offering focused on gold loans and NRI business;
 Professional and experienced management;
 Streamlined risk management controls, policies and procedures

For further details see, “Risk Factors”, “Our Business” and “Financial Statements” on pages 13, 127 and 190,
respectively.

Quantitative Factors

The information presented below relating to our Bank is based on the restated financial information for Fiscal 2010,
2011, 2012, 2013, 2014 and six months ended September 30, 2014, prepared in accordance with Indian GAAP, RBI
guidelines and restated in accordance with the SEBI Regulations. For details, see section titled “Financial
Information – Independent Auditors’ Report on Restated Financial Information” on page F-1.

Some of the quantitative factors which may form the basis for computing the Issue Price are as follows:

1. Basic and Diluted Earnings Per Share (“EPS”) as per our restated financial statements:

Year ended Basic EPS (in `) Diluted EPS (in `) Weight

Year ended March 31, 2012 6.99 6.99 1
Year ended March 31, 2013 7.13 7.13 2
Year ended March 31, 2014 7.39 7.39 3
Weighted Average 7.24 7.24
September 30, 2014 * (4.34) (4.34)
* September 30, 2014 numbers are not annualized

Notes:

(1) EPS calculations have been done in accordance with Accounting Standard 20-“Earning per share” issued by the Institute of
Chartered Accountants of India.
Earnings per share (Rs) = Net profit / (Net loss) available to equity shareholders (after extra-ordinary items)/ Weighted
average number of equity shares outstanding during the year/period

(2) Weighted average number of Equity Shares is the number of Equity Shares outstanding at the beginning of the year/period
adjusted by the number of Equity Shares issued during the year/period multiplied by the time weighting factor. The time
weighting factor is the number of days for which the specific shares are outstanding as a proportion of the total number of
days during the year.

2. Price/Earning (P/E) ratio in relation to Price Band of ` [●] to ` [●] per Equity Share of face value of
` 10 each:

99
 P/E at the lower end of Price P/E at the higher end of
Particulars
band (no. of times) Price band (no. of times)
Based on Basic and Diluted EPS for Year ended March 31, [●] [●]
2014
Based on Weighted Average EPS [●] [●]
Numbers as per restated financial statements.

Industry P/E*

(i) Highest: 17.96

(ii) Lowest: 6.56
(iii) Average: 12.97

* Source: The highest and lowest Industry P/E shown above is based on the Industry peer set provided below under “Comparison of accounting
ratios with Industry Peers”. The Industry composite has been calculated as the arithmetic average P/E of the Industry peer set provided below,
based on consolidated EPS numbers. For further details, see “ - Comparison of accounting ratios with Industry Peers” hereunder.

3. Average Return on Net Worth (“RoNW”) as per our restated financial statements:

Particulars RONW % Weight

Year ended March 31, 2012 5.26 1
Year ended March 31, 2013 4.59 2
Year ended March 31, 2014 4.99 3
Weighted Average 4.90
For 6 months ended September 30, 2014* (3.26)
*September 30, 2014 numbers are not annualized

Note:

Return on net worth (%) = Net profit / (Net loss) after tax (after extra- ordinary items) / Net worth excluding revaluation reserve at the end of the
year/period

4. Minimum Return on Increased Net Worth required for maintaining pre-Issue Basic / Diluted EPS
for the financial year 2014:

At the Floor Price: The minimum return on increased net worth required to maintain pre-Issue EPS for the
year ended March 31, 2014 is [●]% at the Floor Price.

At the Cap Price: The minimum return on increased net worth required to maintain pre-Issue EPS for the year
ended March 31, 2014 is [●]% at the Cap Price.

5. Net Asset Value (“NAV”) per equity share / Book Value per equity share:

The adjusted NAV per equity share of face value of ` 10 each is as under:

(i) As on March 31, 2014 : ` 148.13*

(ii) As on September 30, 2014 : ` 132.85*
(iii) Issue Price per Equity Share : ` [●] **
(iv) As on March 31, 2014 after the Issue: ` [●]

*As per restated financial statements.

** Issue Price will be determined on conclusion of the Book Building Process.

Notes:

Net asset value per equity share (`) = Net worth excluding revaluation reserves and DTA & intangible assets at the
end of the year/period / Number of equity shares outstanding at the end of the year/period

100
6. Comparison with listed industry peers:

For the year ended March 31, 2014

Face Total
Name of the Bank Basic Ro NW
Value Income P/E P/BV NAV (`)
EPS (`) (%)
(`) (` Million)
The Catholic Syrian Bank
1. 10 16,212.96 7.39 [●] [●] 4.99 148.13
Ltd#
@
2. Peer Group
DCB Bank Limited 10 12,669.22 6.05 17.96 2.36 13.12% 46.10
City Union Bank Ltd 1 28,471.32 6.69 14.33 2.57 17.14% 37.31
The Federal Bank Ltd 2 76,399.30 9.81 14.03 1.69 12.07% 81.26
The Karnataka Bank Ltd 10 46,944.10 16.51 7.54 0.77 10.19% 162.00
The Karur Vysya Bank Ltd 10 56,804.14 40.08 14.40 1.86 12.92% 310.35
The Lakshmi Vilas Bank ltd 10 22,019.42 6.11 15.96 0.90 5.66% 107.99
The South Indian Bank Ltd 1 53,835.27 3.78 6.56 0.99 15.06% 25.08
3. Industry Composite 12.97 1.59 12.31%
# Source: Based on the restated financial information for the year ended March 31, 2014
@Based on audited standalone financial results for the financial year ended March 31, 2014

Notes:
1. Total Income is as sourced from the annual reports of the companies.
2. Basic EPS refer to the basic EPS sourced from the annual reports of the companies.
3. P/E Ratio has been computed as the closing market prices of the companies sourced from the BSE website as on March
20, 2015 as divided by the basic EPS provided under Note 2.
4. P/B Ratio has been computed as the closing market prices of the companies sourced from the BSE website as on March
20, 2015, as divided by the NAV provided under Note 6.
5. RoNW (%) has been computed as net profit after tax divided by the net worth of these companies. Net worth has been
computed as sum of share capital and reserves.
6. NAV is computed as the closing net worth of these companies, computed as per Note 5, divided by the closing
outstanding number of fully paid up equity shares as sourced from the BSE website for the Bank as on March 31, 2014.

The Issue Price of ` [●] has been determined by our Bank, in consultation with the BRLMs on the basis of the
demand from investors for the Equity Shares through the Book Building Process and is justified in view of the above
qualitative and quantitative parameters. Investors should read the above mentioned information along with “Risk
Factors” and “Financial Statements” on pages 13 and 190, respectively, to have a more informed view. The trading
price of the Equity Shares of our Bank could decline due to the factors mentioned in “Risk Factors” or any other
factors that may arise in the future and you may lose all or part of your investments.

101
 STATEMENT OF TAX BENEFITS

To,

The Board of Directors,

The Catholic Syrian Bank Limited,
Regd Office – CSB Bhavan,
St. Mary College Road,
Thrissur- 680020
Kerala.

Dear Sir,

We hereby report that the attached Annexure states the possible special tax benefits available to The Catholic Syrian
Bank Limited (“the Bank”) and to the shareholders of the Bank under the Income Tax Act, 1961, Wealth Tax Act,
1957 presently in force in India, subject to the fact that several of these benefits are dependent on the Bank or its
shareholders fulfilling the conditions prescribed under the relevant tax laws. Hence the ability of the Bank or its
shareholders to derive the tax benefits is dependent upon fulfilling such conditions, which based on the business
imperatives, the Bank may or may not choose to fulfill.

We hereby report that the attached Annexure states the possible special tax benefits available to The Catholic Syrian
Bank Limited (“the Bank”) under the Income Tax Act, 1961, Wealth Tax Act, 1957 presently in force in India,
subject to the fact that several of these benefits are dependent on the Bank or its shareholders fulfilling the
conditions prescribed under the relevant tax laws. Hence the ability of the Bank or its shareholders to derive the tax
benefits is dependent upon fulfilling such conditions, which based on the business imperatives, the Bank may or
may not choose to fulfill.

The benefits discussed in the Annexure are not exhaustive. This statement is only intended to provide general
information to the investors and is neither designed nor intended to be a substitute for the professional tax advice. In
view of the individual nature of the tax consequences and the changing tax laws, each investor is advised to consult
his or her own tax consultant with respect to the specific tax implications arising out of their participation in the
issue.

We do not express any opinion or provide any assurance as to whether:

• The Bank or its shareholders will continue to obtain these benefits in future; or
• The conditions prescribed for availing of these benefits have been / would be met with.

The contents of this Annexure are based on the information, explanations and representations obtained from the
Bank and on the basis of our understanding of the business activities and operations of the Bank and interpretations
of the current tax laws and tax laws prevailed at this point of time.

For Sundaram & Srinivasan For Varma & Varma

Chartered Accountants Chartered Accountants
Firm Registration No: 004207S Firm Registration No: 004532S

C. Naresh C. Pankajakshan
M.No. 28684 M.No.012948

Place: Thrissur
Date: March 30, 2015

102
 Annexure

The following special tax benefits are available to the Bank and the prospective shareholders under the current
direct tax laws in India.

This statement is only intended to provide the special tax benefits to the Bank and its shareholders in a general and
summary manner and does not purport to be a complete analysis or listing of all the provisions or possible tax
consequences of the subscription, purchase, ownership or disposal etc. of shares. In view of the individual nature of
tax consequence and the changing tax laws, each investor is advised to consult his/her own tax adviser with respect
to specific tax implications arising out of their participation in the issue.

The information on Tax benefit set out below as available to the bank and its shareholders are mainly dependent
upon fulfilling conditions prescribed under the relevant Act. The benefits discussed are not exhaustive but is
intended to provide general information to the investors and is neither designed nor intended to be a substitute for
professional tax advice. Some or all of the tax consequences of described herein may be amended or modified by
future amendments to the Income-tax Act.

SPECIAL TAX BENEFITS AVAILABLE TO THE BANK

1. INCOME TAX

1. In terms of Section 36(1)(viia) of the Income-tax Act, and subject to the conditions specified therein,
deduction in respect of any provision for bad and doubtful debts made by the bank is allowed at 7.5% of the
total income (computed before making any deduction under this Section and Chapter VIA of the Income-
tax Act) and 10% of the aggregate average advances made by rural branches.

2. In terms of Section 36(1)(viii) of the Income-tax Act, bank is allowed deduction at 20% of the profits
derived from the business of providing long-term finance for industrial or agricultural development or
development of infrastructure facility in India or construction or purchase of houses in India for residential
purposes computed in the manner specified under the Section and carried to a Special Reserve account
from time to time not exceeding twice the paid-up share capital and general reserves. The amount
withdrawn from such a Special Reserve Account would be chargeable to income tax in the year of
withdrawal, in accordance with the provisions of Section 41(4A) of the Income-tax Act.

3. In terms of section 43D of the Act, interest on certain categories of bad and doubtful debts as specified in
Rule 6EA of the Income-tax Rules, 1962, shall be chargeable to tax only in the year of receipt or credit to
Profit and Loss Account, whichever is earlier.

SPECIAL TAX BENEFITS AVAILABLE TO THE SHAREHOLDERS

There are no special tax benefits available to the shareholders with regards to the investment made in the shares of
the Bank.

103
 SECTION IV – ABOUT THE BANK

INDUSTRY OVERVIEW

The information presented in this section has been extracted from publicly available documents from various
sources, including officially prepared materials from the Government and its various ministries, the RBI and the
Indian Banks Association, and has not been prepared or independently verified by our Bank or the Book Running
Lead Managers. The information in this section may not be consistent with other information compiled by third
parties within or outside India. Industry and government publications are also prepared based on information as of
specific dates, which may no longer be relevant or reflect current trends. Industry sources and publications
generally state that the information stated therein have been obtained from sources they believe to be reliable, but
their accuracy, completeness and underlying assumptions are not guaranteed. Accordingly, investment decisions
should not be based on such information. Statements in this section that are not statements of historical fact and
constitute “forward-looking statements”. Such forward-looking statements are subject to various risks, assumptions
and uncertainties and certain factors could cause actual results or outcomes to differ materially.

Overview of the Indian Economy

India is the world's largest democracy in terms of population (approximately 1,236.3 million people as on July 2014
estimate) with an estimated GDP (by purchasing powering parity valuation of country GDP) of approximately US$
4,990,000 million in 2013. Economic liberalization measures, including industrial deregulation, privatization of
state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and served
to accelerate the country's growth, which averaged under 7% per year from 1997 to 2011. India's diverse economy
encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a
multitude of services. Slightly less than half of the work force is in agriculture, but, services are the major source of
economic growth, accounting for nearly two-thirds of India's output with less than one-third of its labor force. India
has capitalized on its large educated English-speaking population to become a major exporter of information
technology services, business outsourcing services, and software workers. India's economic growth began slowing in
2011 because of a decline in investment, caused by high interest rates, rising inflation, and investor pessimism about
the government's commitment to further economic reforms and about the global situation. In late 2012, the
Government announced additional reforms and deficit reduction measures, including allowing higher levels of
foreign participation in direct investment in the economy. The outlook for India's long-term growth is moderately
positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates,
and increasing integration into the global economy. (Source: CIA World Factbook)

The table below sets forth the key indicators of the Indian economy for the last five Fiscals.

(Annual percent change, except for foreign currency reserves)

Particulars As on and for the year ended March 31
2014 2013 2012 2011 2010
GDP growth rate 4.7 4.5 6.7 8.9 8.6
Index of Industrial productivity (growth) (0.1) 1.1 2.9 8.2 5.3
Inflation – Wholesale Price Index (average) 6.0 7.4 8.9 9.6 3.8
Foreign Exchange Reserves (in US$ crore) 30,420 29,200 29,440 30,480 27,910
(Source: Indian Economic Survey 2013-14, MoF, GoI)

After achieving growth of over 9% for three successive years between Fiscal 2006 and Fiscal 2008 and recovering
swiftly from the global financial crisis of 2008-09, the Indian economy has been going through challenging times
that have resulted in lower than 5% growth of GDP for the last two years, i.e., Fiscal 2014 and Fiscal 2013.
Persistent uncertainty in the global outlook, caused by the crisis in Europe and general slowdown in the global
economy, compounded by domestic structural constraints and inflationary pressures, resulted in a protracted
slowdown. The slowdown is broadly in sync with trends in other emerging and developing economies. India’s
growth declined from an average of 8.3% per annum during Fiscal 2005 to Fiscal 2012 to an average of 4.6% during
Fiscal 2013 to Fiscal 2014. In comparison, average growth in the emerging markets and developing economies

104
including China declined from 6.8% to 4.9% in this period (calendar-year basis) (Source: Indian Economic Survey
2013-14, Ministry of Finance, Government of India).

As part of liberalization measures, the RBI has taken a number of measures to enhance the effectiveness of the
prevailing foreign direct investment policy and provide greater clarity on ownership and control. Overall, India
attracted FDI equity inflows of US$24.3 billion in Fiscal 2014, which is an 8.0% increase over the FDI equity
inflows of US$22.42 billion received during the previous Fiscal 2013. (Source: Annual Report 2013-14, Department
of Industrial Policy and Promotion)

Overview of the Indian Banking Industry

Until the 1980s, the Indian financial system was strictly controlled. Interest rates were administered by the
Government. Formal and informal parameters governed asset allocation and strict controls limited entry into and
expansion within the financial sector. The profitability of banks was relatively lower, NPAs were comparatively
high, capital adequacy was diminished and operational flexibility was hindered. The Government’s economic reform
program, which began in 1991, encompassed the financial sector. The first phase of the reform process began with
implementation of the recommendations of the Committee on the Financial System, namely the Narasimham
Committee I. Following that, reports were submitted in 1997 and 1998 by other committees, such as the second
Committee on Banking Sector Reform, namely, the Narasimham Committee II, and the Tarapore Committee on
Capital Account Convertibility. This, in turn, led to the second phase of reforms relating to capital adequacy
requirements, asset classification and provisioning, risk management and merger policies.

Banks in India may be categorised as scheduled banks and non-scheduled banks. Scheduled banks are those that are
included in the second schedule to the RBI Act, comprising scheduled commercial banks and scheduled cooperative
banks. Scheduled commercial banks may further be classified as the State Bank of India and its associates,
nationalised banks, private sector banks, foreign banks and regional rural banks. (In RBI reports, regional rural
banks are usually excluded in tables providing details of individual banks and their summary tables at bank group
level). As of Fiscal 2014, there were 146 scheduled commercial banks in India of which 57 were regional rural
banks. (Source: Quarterly Statistics on Deposits and Credits of Scheduled Commercial Banks, December 2014) As
of Fiscal 2014 scheduled commercial banks had total liabilities/ assets of ` 109,635 billion, registering a growth of
14.3% from Fiscal 2013, and approximately ` 85,331 billion of deposits and approximately ` 67,352 billion of loans
and advances. Aggregate deposits for all scheduled commercial banks had registered an annual growth rate of 14.9%
while the loans and advances for all scheduled commercial banks had increased by 14.5%. (Source: RBI Report on
the Indian Banking Sector at a glance, 2013-2014) As on December 31, 2014, all scheduled commercial banks
registered an annual growth of 15.8%, 14.0%, 12.4% and 8.5% in terms of aggregate deposits from the rural, semi-
urban, urban and metropolitan population, respectively, and an annual growth of 12.7%, 15.0%, 9.2% and 9.2% in
terms of gross bank credit from the rural, semi-urban, urban and metropolitan population, respectively. The credit
deposit ratio for all scheduled commercial banks stood at 76.4. (Source: Quarterly Statistics on Deposits and Credits
of Scheduled Commercial Banks, December 2014)

Constituents of the Indian Banking Industry

The Reserve Bank of India

The RBI is the central regulatory and supervisory authority for the Indian banking sector. Besides regulating and
supervising the banking system, the RBI performs the following important functions:

 acts as the central bank and the monetary authority;

 issues currency;
 manages debt for the central and certain state governments that have entered into agreement with it;
 regulates and supervises NBFCs;
 manages the country’s foreign exchange reserves;
 manages the capital account of the balance of payments;
 regulates and supervises payment settlement systems;
 operates a grievance redressal scheme for bank customers through the banking ombudsmen and formulates

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 policies for fair treatment of banking customers; and
 develops initiatives such as financial inclusion and strengthening of the credit delivery mechanisms to
priority sectors and weaker sections, including agricultural entities, small and micro-enterprises and for
affordable housing and education.

The RBI issues guidelines on various issues relating to the financial reporting of entities under its supervision. These
guidelines regulate exposure standards, income recognition practices, asset classification, provisioning for non-
performing and restructured assets, investment valuation and capital adequacy. All the institutions under the purview
of the RBI are required to furnish information relating to their businesses on a regular basis.

Banks in India can be classified as follows.

(Source: RBI’s Manual on Financial and Banking Statistics, March 2007)

Commercial Banks

Commercial banks in India are divided into scheduled and non-scheduled commercial banks. Scheduled commercial
banks are banks that are listed in the schedule to the Reserve Bank of India Act, 1934 (the “RBI Act”). Scheduled
commercial banks include the State Bank of India (“SBI”) and its associates, nationalized banks, regional rural
banks, foreign banks, Indian private banks and other scheduled commercial banks. SBI and its associates together
with the nationalized banks and regional rural banks are known as public sector banks while the other scheduled
commercial banks, excluding foreign banks, are known as private sector banks. Commercial banks which are not
included in the second schedule to the RBI Act are classified as “non-scheduled banks”.

The focus of commercial banks in India has traditionally been on meeting the short-term financing needs of
industry, trade and agriculture. The priority sectors for lending, as determined by the RBI, currently include
agriculture, micro and small enterprises, education and housing. Growth in aggregate deposits of all scheduled
commercial banks accelerated to 12.3% in September 2014 from 11.5% one year ago, whereas gross bank credit
decelerated to 9.5% in September 2014 from 15.1% one year ago. (Sources: RBI’s Quarterly Statistics on Deposits
and Credit of Scheduled Commercial Bank, September 2014; RBI’s Quarterly Statistics on Deposits and Credit of
Scheduled Commercial Banks, March 2014; RBI’s Report on Currency and Finance 2005-2006; RBI’s Annual
Report 2013-14)

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Public sector banks

Public sector banks are scheduled commercial banks with a significant Government shareholding and constitute the
largest category in the Indian banking system. These include, as on Fiscal 2014, the SBI and its five associate banks,
21 nationalised banks and 57 regional rural banks. As on March 31, 2014, public sector banks in India had total
deposits of approximately ` 6,589.02 billion and loans and advances of approximately ` 5,101.14 billion. SBI and
its associates accounted for approximately 21.43% of the total deposits and approximately 23.23% of the loans and
advances and nationalised banks accounted for approximately 55.79% of the total deposits and approximately
52.51% of the loans and advances of the scheduled commercial banks. The public sector banks, in total, accounted
for approximately 75.22% of the deposits and approximately 75.74% of the advances of the scheduled commercial
banks. These figures do not include regional rural banks. (Source: Statistical Tables Relating to Banks in India,
March 2014)

Regional rural banks have established from 1976 by the central Government, state governments and sponsoring
commercial banks jointly, with a view to develop the rural economy. Regional rural banks provide credit to small
farmers, artisans, small entrepreneurs and agricultural labourers. The NABARD is responsible for regulating and
supervising the functions of the regional rural banks.

Private sector banks

After bank nationalisation was completed in 1969 and 1980, the majority of Indian banks were public sector banks.
Some of the existing private sector banks, which showed signs of an eventual default, were merged with state-owned
banks. In July 1993, as part of the banking reform process and as a measure to induce competition in the banking
sector, the RBI permitted entry by the private sector into the banking system. This resulted in the emergence of
private sector banks, collectively known as the “New Private Sector Banks”. There were seven New Private Sector
Banks operating as of Fiscal 2013. In addition, 13 private sector banks existing prior to July 1993 were operating as
of Fiscal 2013. These are collectively known as the “Old Private Sector Banks”. (Source: RBI’s Profile of Banks
2012-2013)

As of Fiscal 2014, private sector banks accounted for approximately 18.7% of the deposits and approximately 19.9%
of the advances of the scheduled commercial banks. These figures do not include regional rural banks. (Source:
Statistical Tables Relating to Banks in India, March 2014)

The Union Finance Minister made an announcement in his budget speech for 2010-11 that there was a need to
extend the geographic coverage of banks and improve access to banking services and the RBI considered whether to
begin granting additional banking licences to private sector players.

Following the budget announcement, the New Banks Licensing Guidelines were issued by the RBI in February 2013
specifying that select entities or groups in the private sector, entities in the public sector and non-banking financial
companies with a successful track record of at least 10 years would be eligible to promote banks. Further, the RBI
has published certain criteria for ascertaining whether a bank is ‘fit and proper’ for the grant of a licence. The new
banks can be set up only through a non-operative financial holding company registered with the RBI and the initial
minimum paid up equity voting capital requirement for the applicants is ` 5.0 billion, with foreign shareholding not
exceeding 49.0% for the first five years. The applicants were required to submit applications for these licences to
RBI by July 1, 2013 and 25 applications were reviewed by the RBI. These applications were screened by the RBI
before being forwarded to the RBI’s HLAC for further scrutiny, which submitted its recommendations to the RBI on
February 25, 2014.

On April 2, 2014, the RBI granted “in-principle” approval to two applicants to set up banks under the New Banks
Licensing Guidelines. The “in-principle” approval is valid for a period of 18 months and the applicants will not be
permitted to engage in banking business until a regular licence is issued after satisfaction of the conditions stipulated
by the RBI. In the future, the RBI intends to issue licences on an on-going basis, subject to the RBI’s qualification
criteria.

Additionally, the RBI is working on a policy of having various categories of “differentiated” bank licenses which
will allow a wider pool of entrants into banking. Guidelines for licensing of payment banks and small banks have

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been issued in November 2014. In terms of these guidelines, payment banks, registered as public limited companies
under the Companies Act, 2013 and licensed under section 22 of the Banking Regulation Act, would only be
allowed to accept demand deposits and provide payment and remittance services, and will be provide scheduled
bank status once they commence operations, and are found suitable in terms of section 42 of the RBI Act.

In terms of a press release on February 4, 2015, the RBI announced that it had received applications from 72
applicants for registration as small finance banks, and 41 applications from payment banks. (Source: RBI Press
Release 2014-2015/1639, dated February 4, 2015)

Foreign banks

As of Fiscal 2014, there were 42 foreign banks operating in India. Foreign banks accounted for approximately 4.1%
of deposits and approximately 4.3% of aggregate advances of scheduled commercial banks (not including regional
rural banks). (Source: Statistical Tables Relating to Banks in India, March 2014)

The RBI has stipulated that banks, including foreign banks operating in India, should not acquire any fresh stake in
another bank’s equity shares if by such acquisition, the investing bank’s holding would exceed 5.0% of the investee
bank’s equity capital. In February 2005 the RBI issued a “Roadmap for Presence of Foreign Banks in India”,
announcing the following measures to be implemented in two phases:

 During the first phase (from March 2005 through to March 2009), foreign banks were allowed to establish a
presence by setting up wholly owned subsidiaries or by converting existing branches into wholly-owned
subsidiaries.

 Also during the first phase, foreign banks were allowed to acquire a controlling stake in private sector banks
identified by the RBI for restructuring. This was only to be done in a phased manner.

 For new and existing foreign banks, proposals were made to go beyond the existing World Trade
Organisation commitment of allowing increases of 12 branches per year. A more liberal policy will be
followed for areas with a small number of banks.

 During the second phase (from April 2009 onwards) and after a review of the first phase, foreign banks would
be allowed to acquire up to 74.0% in private sector banks in India.

The second phase of the roadmap which was to commence in April 2009 envisaged removal of limitations on the
operations of wholly owned subsidiaries of foreign banks and treating them on par with the domestic banks to the
extent appropriate. During the first phase no foreign bank came forward to set up or convert their branches into a
wholly owned subsidiary in the absence of adequate incentives. (Source: RBI Press Release 2013-2014/936 dated
November 6, 2013).

In January 2011, the RBI released a draft discussion paper on the mode of presence of foreign banks in India. The
paper indicates a preference for a wholly-owned subsidiary model of presence over a branch model. Other
recommendations of the discussion paper include requiring systemically important foreign banks to convert their
Indian operations into wholly-owned subsidiaries, a less restrictive branch expansion policy and ability to raise
Rupee debt through issuance of non-equity capital instruments for such converted subsidiaries, lower priority sector
targets as compared to domestic banks and unified regulation for both Indian and foreign banks with respect to
investments in subsidiaries and associates.

In July 2012, the RBI revised priority sector lending norms and mandated foreign banks with 20 branches or more in
India to meet priority lending norms as prescribed for domestic banks.

In November 2013, the RBI issued a scheme for setting up wholly-owned subsidiaries by foreign banks in India.
The scheme envisages that foreign banks that commenced business in India after August 2010, or do so in the future,
would be permitted to do so only through wholly-owned subsidiaries if certain specified criteria apply to them.
These criteria include incorporation in a jurisdiction which gives legal preference to home country depositor claims
in case of a winding up proceeding, among others.

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Further, a foreign bank that has set up operations in India through the branch mode after August 2010 will be
required to convert its operations into a subsidiary if it is considered to be systemically important. A bank would be
considered to be systemically important if the assets on its Indian balance sheet (including credit equivalent of off-
balance sheet items) equals 0.25% of the total assets (inclusive of credit equivalents of off-balance sheet items) for
all scheduled commercial banks in India as of March 31 of the preceding year. Establishment of a subsidiary would
require approval of the home country regulator/supervisor and the RBI which would be subject to various factors
including economic and political relations with the country of incorporation of the parent bank and reciprocity with
the home country of the parent bank. The regulatory framework for a subsidiary of a foreign bank would be
substantially similar to that applicable to domestic banks, including with respect to priority sector lending and
branch expansion. Wholly-owned subsidiaries of foreign banks may, after further review, be permitted to enter into
merger and acquisition transactions with Indian private sector banks, subject to adherence to the foreign ownership
limit of 74.00% that is currently applicable to Indian private sector banks.

Cooperative banks

Cooperative banks cater to the financing needs of agriculture, small industry and self-employed businessmen in
urban, semi-urban and rural areas of India. The state land development banks and the primary land development
banks provide long-term credit for agriculture. The Banking Regulation (Amendment) and Miscellaneous Provisions
Act, 2004, which came into effect from September 24, 2004, specifies that all multi-state cooperative banks are
under the supervision and regulation of the RBI. Accordingly, the RBI is currently responsible for the supervision
and regulation of urban cooperative societies, NABARD, state cooperative banks and district central cooperative
banks. The wide network of co-operative banks, both rural and urban, supplements the commercial banking network
for deepening financial intermediation by bringing a large number of depositors/ borrowers under the formal
banking network.

Key Banking Industry Trends in India

The growth of the Indian banking sector moderated during Fiscal 2014. Profitability of banks declined on account of
higher provisioning on banks’ delinquent loans and lackluster credit growth. The financial health of urban and rural
co-operatives indicated divergent trends in terms of key indicators. While urban co-operative banks exhibited
improved performance, the performance of primary agriculture credit societies and long term rural credit co-
operatives remained a matter of concern with a further increase in their losses coupled with deterioration in asset
quality. While the asset size of NBFCs demonstrated expansion, asset quality deteriorated during Fiscal 2014.
(Source: Report on Trend and Progress in Banking in India 2013 – 2014)

Under-penetration of banking channels

According to the Report of the Committee on Comprehensive Financial Services for Small Businesses and Low
Income Household of the RBI (January 2014), as on December 31, 2013, an estimated 36% of the Indian population
have at least one bank account. Banking penetration in urban and rural India remained grim, overall, with only 45%
of urban residents and 32% of rural residents having bank accounts. Within these matrices, there was significant
variation between various districts. In an urban context the current penetration of individual bank accounts, as
proportion of the population of people above the age of 18 years, ranged from 10% in Imphal East district of
Manipur to 688% in Wayanad district of Kerala, while in the rural context it ranges from close to 0% in the districts
of Nagaland to 89% in Solan in Himachal Pradesh. A large proportion of the bank accounts did not have full service
electronic capabilities. Furthermore, while 89% of Indian districts had 25 or more payment access points (including
bank branches, active business correspondent locations, ATMs and point-of-sale terminals) only 3% of the districts
have 25 or more payment access points in rural areas.

In terms of the credit to GDP ratio, the abovementioned report indicates that while above 94% of the Indian
districts’ urban areas have in excess of 10% credit to GDP ratio, only 18% of them are currently above 50%. The
situation in rural areas is significantly worse, with only 30% of Indian districts’ rural areas currently having in
excess of 10% credit to GDP ratio with a mere 2% of Indian districts above 50%.

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The table below profiles the differences in outstanding bank credit allocation with respect to the sectors’
contributions to the GDP as on Fiscal 2013 (in respect of sectors that contribution 1% or more to the GDP).

Sectoral GDP Sectoral Credit Credit to GDP

(` crore) (%)
GDP at prices as on Fiscal 2013 9,321,638 Gross bank credit of all 4,861,345 52.00
SCBs
Of which
GDP of agriculture and allied 1,644,834 Credit to agriculture 589,914 35.90
activities
GDP of industry 2,436,502 Credit to industry 2,230,182 91.5
GDP of services 5,240,302 Credit to services 2,041,249 39.00
GDP contribution of Industry 510,473 Credit to Industry MSMEs 284,348 55.70
MSMEs
GDP contribution of Service 1,097,899 Credit to Service MSMEs 277,947 25.30
MSMEs
(Source: Report of the Committee on Comprehensive Financial Services for Small Businesses and Low Income
Household of the RBI (January 2014))

The table indicates that agriculture still has a distance to go before it reaches a benchmark 50% even though it is
above the 10% mark. Industry MSMEs appear to have just above 50% financial depth, while service MSMEs have a
much lower depth at 25%, and have a long way to go to reach a 50% benchmark.

Consumer credit

The consumer credit market in India has undergone a significant transformation over the last decade and has
experienced rapid growth due to consumer credit becoming cheaper, more widely available and increasingly a more
acceptable avenue of funding for consumers. The market has changed dramatically due to the following factors:

 fast emerging working population and middle class population

 increased focus by banks and financial institutions on consumer credit, resulting in a market shift towards
regulated players from unregulated moneylenders/ financiers;
 increasing desire by consumers to acquire assets such as cars, goods and houses on credit;
 growing number of households in a bank’s target segment;
 improved terms of credit;
 legislative changes that offer greater protection to lenders against fraud and potential default, increasing the
incentive to lend; and
 growth in assignment and securitisation arrangements for consumer loans, enabling non-deposit based
entities to access wholesale funding and compete in the market, based on the ability to originate, underwrite
and service consumer loans.

Retail Banking

During Fiscal 2014, banks’ retail loans portfolios continued to growth rapidly. Total retail loans increased by 15.4%
from November 2013 to November 2014, mainly led by growth in housing loans as the largest segment of retail
loans and an increasing growth in auto loans. (Source: RBI, Press Release, Sectoral Deployment of Bank Credit –
November 2014)
(` billion, except percentages)
Particulars Outstanding as on Percentage variation
Nov 2012 Nov 2013 Nov 2014 Nov 2013/ Nov 2014/
Nov 2012 Nov 2013
Housing loans 4,337 5,121 5,960 18.1% 16.4%
Vehicle loans 1,033 1,240 1,459 20.1% 17.6%
Advances against fixed 557 565 557 1.5% (1.4)%
deposits
Education 544 589 628 8.3% 6.6%

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 Particulars Outstanding as on Percentage variation
Nov 2012 Nov 2013 Nov 2014 Nov 2013/ Nov 2014/
Nov 2012 Nov 2013
Credit card receivables 247 241 295 (2.0)% 22.1%
Consumer Durables 75 100 147 32.8% 46.8%
Advances to individuals 28 33 40 17.5% 23.9%
against securities
Other personal loans 1,725 1,955 2,271 13.3 16.2
Total retail loans 8,545 9,844 11,357 15.2% 15.4%
(Source: RBI, Press Release, Sectoral Deployment of Bank Credit – November 2014)

Gold loans

India continues to be one of the largest gold markets in the world. The attraction towards gold in India stems from
varied historical and cultural factors and its perceived safety in times of economic stress. South India as a region
continues to be the largest consumer of gold in India with the southern states accounting for over 40% of India’s
overall gold demand, followed by the west (25%), north (20-25%) and east (10-15%). Rural India is estimated to
hold around 65% of total gold stock as this section of the population views gold as a secure and easily accessible
savings vehicle along with its consumption purpose. (Source: RBI Report of the Working Group to Study the Issues
Related to Gold Imports and Gold Loans by NBFCs)

Accordingly, even the gold loan market has also developed on the same lines where a large portion of market is
concentrated in southern India. The southern region of India accounts for the largest share of the gold loans market
in India.

The prevalence of high level of rural indebtedness, easy availability of gold loans at extreme flexible terms, relative
constriction of personal and retail loans by banks and changing attitude of customers to avail gold loans have
contributed to the sharp growth in the gold loans outstanding. (Source: RBI Report of the Working Group to Study
the Issues Related to Gold Imports and Gold Loans by NBFCs)

Annual Growth Rate of Gold Loans Outstanding (%)

Year Banks Gold Loans NBFC Gold Loans Total Gold Loans
2008-09 54.2 41.4 52.5
2009-10 47.7 169.3 62.6
2010-11 52.1 126.7 67.2
2011-12 77.6 80 78.3
(Source: RBI Report of the Working Group to Study the Issues Related to Gold Imports and Gold Loans by NBFCs)

Gold loans disbursed by NBFCs have witnessed rapid growth in the recent past. Therefore, there is a general feeling
that NBFCs account for the majority of gold loans disbursed. However, contrary to popular belief, share of banks in
total gold loans is highest at 72.3% at March 31, 2012 and banks continue to retain the dominant share in the gold
loan market. (Source: RBI Report of the Working Group to Study the Issues Related to Gold Imports and Gold
Loans by NBFCs)

Commercial Banking Trends

Balance Sheet Operations of Scheduled Commercial Banks

Continuing a trend from the year Fiscal 2012, the overall growth in the balance sheets of scheduled commercial
banks moderated further in the year Fiscal 2013. The major source of this moderation was bank credit, which was
partly reflective of the slowdown in real economy activity coupled with increasing risk aversion by banks. The
slowdown in credit growth in Fiscal 2013 as compared to Fiscal 2012 could be seen across all bank groups, except
SBI and its associates. Although there was a moderation in the balance sheet of the banking sector, deposits – the
largest component on the liabilities side – maintained their growth in 2012-13, particularly for private banks.
(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

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The table below sets out the change in balance sheet of scheduled commercial banks in Fiscal 2013, as compared to
Fiscal 2012.

(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

Credit-Deposit Ratio

As on March 31, 2014, the credit deposit ratio for all commercial banks was 77.8% as compared to 77.9% in Fiscal
2013. Aggregate deposits grew by 14.2% and bank credit grew by 14.0% in Fiscal 2014. Deployment of credit to
industries moderated in Fiscal 2014, even as credit to agriculture and allied activities, services and personal loans
picked up. Within industries, sectors such as food processing, construction, leather, rubber, glass and paper
witnessed an upturn during April 2014 to February 2014 (Source: Macroeconomic and Monetary Developments
2014-15 (An Update), RBI April 2014 and Annual Report for Fiscal 2014).

As on March 31, 2013, the credit-deposit ratio for scheduled commercial banks was 79.1 as compared to 78.6 as of
Fiscal 2012. Aggregate deposits increased by 15.1% while loans and advances increased by 15.9% as of Fiscal 2013.
(Source: Report on Trend and Progress in Banking in India 2012 – 2013)

Credit growth on a year-on-year basis declined in Fiscal 2014, and recorded a low of 10.00% as on September 2014.
Public sector banks under-performed other banks in terms of credit growth, recording a growth of 7.9%. Growth in
deposits also declined to 12.9% as of September 2014 from 13.7% as of March 2014. Low credit growth reflected a
combination of factors such as reliance on alternative sources of funding, balance sheet repair and slack in demand
as also an element of risk aversion. (Source: Report on Trend and Progress in Banking in India 2013 – 2014)

There was an overall rise in the growth of priority sector credit in Fiscal 2014 as compared to a drop in overall credit
growth during the year. In Fiscal 2013, credit to priority sectors by public and private sector banks were 39.4% and
35.8%, respectively (representing the higher of the adjusted net bank credit or the credit equivalent of the off-
balance sheet exposure), which fell short of the overall target of 40%. 10 out of 26 public sector banks, 4 out of 20
private sector banks and one out of 39 foreign banks could not achieve the target of the overall priority sector as on
March 31, 2014. (Source: RBI Annual Report for 2013-2014)

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In the past, growth in credit to sensitive sectors, namely, real estate, capital markets and commodities, generally
followed a pattern similar to the growth in overall credit. However, in Fiscal 2013, growth in credit to sensitive
sectors almost doubled primarily on account of credit to real estate. This expansion needs to be viewed in light of the
steep rise in housing prices in all Tier I cities and several Tier II cities in Fiscal 2013 (Source: RBI Report on Trend
and Progress of Banking in India 2012-13).

MSME sector

Small enterprises play a very significant role in terms of balanced and sustainable growth of the economy. Small
enterprises contribute 38% of the manufacturing output and around 40% of the total export of the country and
providing employment to nearly 106 million people through about 46 million units, located in both the rural and
urban areas across the country. According to the Ministry Of Micro, Small and Medium Enterprises, the number of
MSME units in India has grown at a CAGR of 4% during last five years. Strong growth in total investments in
MSMEs indicates towards their expanding footprint and growing importance. (Source: Ministry of Micro, Small and
Medium Enterprises, Annual Report 2013-2014)

MSMEs primarily rely on bank finance for their operations and as such ensuring timely and adequate flow of credit
to the sector has been an overriding public policy objective. Over the years there has been a significant increase in
credit extended to this sector by the banks. As at the end of March 2011, the total outstanding credit provided by all
Scheduled Commercial Banks to the MSME sector stood at ` 4,785.27 billion as against ` 3,622.90 billion in March
2010, registering an increase of 32%. (Source: Address of the Deputy Governor of the RBI at the SME Banking
Conclave 2012)

Trends in 2015

On a year-on-year basis:

 Non-food bank credit increased by 9.7% in January 2015 as compared with the increase of 15.0% in
January 2014.
 Credit to the agriculture sector and allied activities increased by 16.0% in January 2015 from 13.2% in
January 2014.
 Credit to industrial segments increased by 6.6% in January 2015 as compared with the increase of 13.6% in
January 2014. Deceleration in credit growth to industry was observed in all major sub-sectors, barring
beverages, tobacco and construction.
 Credit to the services sector increased by 7.5% in January 2015 as compared with the increase of 17.3% in
January 2014. Deceleration in credit growth in the services sector was observed in all major sub-sectors.
 Credit to NBFCs increased by 5.3% in January 2015 as compared with the increase of 13.4% in January
2014.
 Personal loans increased by 15.8% in January 2015 as compared with the increase of 16.6% in January
2014.
(Source: Sectoral Deployment of Bank Credit – January 2015; Press Release: 2014-2015/1826 issued by
RBI dated February 27, 2015)

Balance Sheet Operations of Scheduled Commercial Banks

The consolidated balance sheet of scheduled commercial banks in Fiscal 2014 registered a decline in growth in total
assets and credits for the fourth consecutive year. This decline could be attributed to a variety of factors ranging
from slower economic growth, deleveraging, persistent pressure on asset quality leading to increased risk aversion
among banks and increasing recourse by corporates to non-bank financing including commercial papers and external
commercial borrowings.

With both credit and deposit growth more or less same, the outstanding credit-deposit ratio at the aggregate level
remained unchanged at around 79%. (Source: Report on Trend and Progress in Banking in India 2013 – 2014)

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Asset Quality of Scheduled Commercial Banks

Gross NPA ratio of scheduled commercial banks increased to 4.5% in September 2014 from 4.1% in March 2014.
The net NPA ratio of scheduled commercial banks also increased to 2.5% in September 2014 from 2.2% in March
2014. Stressed advances increased to 10.7% of the total advances from 10.0% between March and September 2014.
Public sector banks continued to record the highest level of stressed advances at 12.9% of their total advances in
September 2014 followed by private sector banks at 4.4%.

The share of stressed advances in total advances increased in the case of 46 scheduled commercial banks
(accounting for around 88% of the total loan portfolios of scheduled commercial banks) between March and
September 2014. 20 banks have higher share in the total stressed advances of all scheduled commercial banks than
their share in the total advances of SCBs. These 20 banks together constitute 43% of the total scheduled commercial
bank loan portfolio and contribute around 60% of the total stressed advances of the banking system.

The infrastructure, iron and steel, textiles, mining (including coal) and aviation sectors had significantly higher
levels of stressed assets. These five sub-sectors had 52% of total stressed advances of all scheduled commercial
banks as of June 2014, whereas in the case of public sector banks it was at 54%. (Source: Report on Trend and
Progress in Banking in India 2013 – 2014)

Category of Bank Percentage of Gross NPA Percentage of Net NPA Ratio Percentage of Restructured
Ratio (%) (%) Structured Advances to Gross
Advances (%)
As of March 31, As of March 31, As of March 31,
2013 2014 2013 2014 2013 2014
Public Sector Banks 3.8 4.7 2.0 2.7 7.2 7.2
Private Sector Banks 1.9 1.9 0.5 0.7 1.9 2.3
Foreign Banks 3.0 3.9 1.0 1.1 0.2 0.1
Aggregate 3.4 4.1 1.7 2.2 5.8 5.9

Category of Bank Gross NPA across Sectors

(as percentage of gross advances to each sector)
As of March 31,
2011 2012 2013 2014
Agriculture 3.3 4.3 4.7 4.4
Medium & Small Enterprises 3.6 4.0 5.1 5.2
Other Priority Sector 4.0 4.4 3.0 3.0
Total Priority Sector 3.6 4.2 4.4 4.4
Non-Priority Sector 1.8 2.3 3.0 4.0
Total 2.4 2.9 3.4 4.1
(Source: Source: RBI Annual Report 2013-14)

Interest rates and inflation

CPI inflation eased during the period from December 2013 to February 2014, declining to 8.0% after remaining
above 9% for 22 successive months and touching a high of 11.2% in November 2013. The moderation in CPI
inflation resulted from a sharp correction in food prices. However, the disinflationary momentum has not gathered
strength as decline in food prices was temporary and second round effects from high food inflation continue to exert
pressures on the general price level. CPI inflation (excluding food and fuel inflation) demonstrated considerable
persistence at an elevated level during the first half of Fiscal 2014, followed by a fall from 8.5% in September 2013
to 7.8% in March 2014 and further to 7.4% in July 2014.

Monetary policy response during the second half of Fiscal 14 was aimed at anchoring inflation expectations and
containing second round impact in the wake of such persistence. The RBI increased the LAF repo rate by a total of
75 basis points to 8.0% during September 2013 to January 2014.

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CPI inflation moderated during December 2013 to February 2014, driven largely by seasonal moderation in
vegetable prices. CPI (combined) inflation remained above 8% till May 2014 but declined to 7.5% in June 2014 on
account of favourable base effect. However it rebounded to 8.0% in July 2014 as vegetable prices went up by 16.9%
over the month. Though some moderation in CPI inflation excluding food and fuel inflation is visible in recent
months, the extent of moderation warranted by the significant growth slowdown is yet to manifest in CPI.

Average WPI inflation during Fiscal 14 at 6.0% was significantly lower than 7.4% during the previous year.
Whereas inflation in food articles picked up, inflation in the fuel group remained persistent. The decline in overall
inflation in terms of the WPI was largely driven by the fall in average inflation in non-food manufactured products,
reflecting weak pricing power of the Indian corporate sector. Softer global commodity prices, especially of metals
played a significant role in keeping inflation low in this segment. However, on a year-on-year basis, non-food
manufactured product inflation steadily edged up from 2.2% in July 2013 to 4.0% in March 2014, reflecting input
cost recoveries. (Source: Source: RBI Annual Report 2013-14)

Income and profitability

In Fiscal 2014, the growth in net profits of scheduled commercial banks, which had been on a declining trend since
Fiscal 2012, turned negative. Scheduled commercial banks as a whole reported net profits of approximately ` 809
billion, indicating decline by 11.3% compared to previous year. This decline in net profits was primarily the result of
higher provisioning on banks’ delinquent loans which registered an increase of nearly 34% coupled with growth in
the interest expenses of around 12% during the year. This in turn impacted their return on assets and return on
equity. Their spread and net interest margin also witnessed a decline.

After contraction in the profits after tax during Fiscal 2014, scheduled commercial banks recorded positive growth
in profits after tax at 10.0% in September 2014 due to the significantly lower growth in provisioning and write-offs.
The return on assets of all scheduled commercial banks remained at 0.8% as of September 2014, whereas, the return
on equity of scheduled commercial banks improved to 9.9% as of September 2014 from 9.5% as of March 2014.
(Source: Report on Trend and Progress in Banking in India 2013 – 2014)

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(Source: RBI’s Report on Trend and Progress of Banking in India 2012-2013)

Financial Inclusion

In January 2010, the RBI advised all public and private sector banks to submit a board-approved three-year
Financial Inclusion Plan (“FIP”) starting in April 2010. Banks were advised to devise FIPs congruent with their
business strategy and comparative advantage and to make FIPs an integral part of their corporate plans. These plans
include self-set targets for rural brick & mortar branches opened, business correspondents deployed, coverage of
unbanked villages, no-frills accounts opened, Kisan Credit Cards and general credit cards issued, as well as other
products designed for financially excluded segments. The implementation of these plans was closely monitored by
the RBI on a monthly basis through a quantitative reporting format. (Source: RBI Annual Report 2012-13)

As a result of the implementation of FIPs by banks, there was a rise in the number of newly-opened branches in Tier
5 and Tier 6 rural centers. The following table sets out the growth in the number of newly-opened branches in Tier
5 and Tier 6 rural centers from 2010 to 2013:

Tier-wise Break up of Newly Opened Bank Branches

Tier 2010-11 2011-12 2012-13P

Tier 1 1,942 2,235 1,752
Tier 2 449 642 791
Tier 3 1,167 1,241 1,006
Tier 4 663 823 727
Tier 5 580 979 1,114
Tier 6 877 1,553 1,823
Total 5,678 7,473 7,213
(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

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In addition, there has been a significant growth in the number of ATMs in rural areas in recent years:

Number of ATMs of SCBs at Various Centers

(At end-March 2013)
Bank group Rural Semiurban Urban Metropolitan Total
1 2 3 4 5 6
Public Sector Banks 8,552 18,445 22,518 20,137 69,652
(12.3) (26.5) (32.3) (28.9) (100.0)
Nationalised Banks* 4,406 8,283 10,873 11,797 35,359
(12.5) (23.4) (30.8) (33.4) (100.0)
SBI Group 4,053 9,847 10,912 7,779 32,591
(12.4) (30.2) (33.5) (23.9) (100.0)
Private Sector Banks 2,982 9,244 13,349 17,526 43,101
(6.9) (21.4) (31.0) (40.7) (100.0)
Old Private Sector Banks 768 2,760 2,354 1,684 7,566
(10.2) (36.5) (31.1) (22.3) (100.0)
New Private Sector Banks 2,214 6,484 10,995 15,842 35,535
(6.2) (18.2) (30.9) (44.6) (100.0)
Foreign Banks 30 21 244 966 1,261
(2.4) (1.7) (19.3) (76.6) (100.0)
Total 11,564 27,710 36,111 38,629 1,14,014
(10.1) (24.3) (31.7) (33.9) (100.0)
Growth over previous year 33.9 22.2 16.5 15.8 19.2
Note: Figures in parentheses indicate percentage share of total ATMs under each bank group.
*
Excludes IDBI Bank Limited
(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

On account of the increased penetration of branches, the major beneficiaries have been the under-banked regions,
namely, the north-eastern, eastern and central regions. Consequently, the regional gap in terms of banking
penetration has narrowed over recent years as shown by a steady decline in the range (maximum – minimum) in the
population per bank branch.

(Source: RBI’s Report on Trend and Progress of Banking in India 2012-13)

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The following table sets out a summary of the progress of the implementations of FIPs of all banks, including RRBs,
for the recent years, including progress from April 2013 to March 2014

(Source: RBI’s Annual Report for 2013-14)

The first three-year FIP of banks for the period of 2010-2013 has ended. With the completion of this phase, a large
banking network has been created and a large number of bank accounts have been opened. According to the RBI,
the performance of banks under FIP up to March 31, 2014 includes the following:

i. The number of banking outlets has gone up to nearly 384,000. Out of these, 115,350 banking outlets were
opened during the year 2013-2014.
ii. Nearly 5,300 rural branches were opened during the last one year. Out of these, nearly 4,600 branches, or
approximately 86%, were opened in unbanked rural centers (Tier 5 and Tier 6 centers).
iii. With the addition of 6.2 million small farm sector credits during 2013-2014, there are 40 million such
accounts as on March 31, 2014.
iv. With the addition of 3.8 million small non-farm sector credits during 2013-2014, there are 7.4 million such
accounts as on March 31, 2014.

However, it was observed that the accounts opened and banking infrastructure created has not seen substantial
operations in terms of transactions. To continue the process of ensuring access to banking services to the excluded,
banks have been advised to draw up a three-year FIP for the period of 2013-2016. Banks have now been advised
that their FIPs should be disaggregated to the branch level, in order to ensure the involvement of all stakeholders in
the financial inclusion efforts. The focus under the new plan is now more on the volume of transactions in the large
number of accounts opened.

Some important points on progress made by domestic public and private sector banks (including RRBs) under their
financial inclusion plan for the six months period from April 2014 to September 2014 includes:

i. An increase of 62,948 banking outlets during the current half year taking the total number of banking
outlets to 446,752 as at the end of September 2014.
ii. Basic Savings Bank Deposit Accounts (“BSBDAs”) reached 305 million for the half year ended September
2014 showing an increase of 62 million accounts during this period. There was a considerable increase in

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 the opening of BSBDAs during August and September 2014 in view of government’s initiative under the
Pradhan Mantri Jan Dhan Yojana.
iii. Business Correspondent – Information and Communication Technology transactions in BSBDAs showed
steady progress with 220 million transactions for the half year ended September 2014 as against 329
million transactions recorded for the year ended March 2014.
iv. Kisan Credit Cards which reflect flow of credit towards farm sector entrepreneurial activities increased by
1.2 million during the half year ended September 2014.
v. General credit cards which reflect flow of credit towards non-farm sector entrepreneurial activities
increased by 1.3 million during the half year ended September 2014.

(Source: RBI’s Financial Stability Report (Including Trend and Progress of Banking in India 2013-14) Issue No. 10,
December 2014)

Pradhan Mantri Jan Dhan Yojna

In an effort to bolster financial inclusion within Indian households, the Government launched the Pradhan Mantri
Jan Dhan Yojna (“PMJDY”), which aims to provide at least one bank account and ensure availability of basic
banking services such as debit cards, mobile banking facility, cash withdrawals and deposits, money transfer,
balance enquiry services and mini statements to every household in India. To provide such facilities, banking outlets
are required to be opened within a distance of five kilometers from every village. Necessary infrastructure is also
required to be put in place for facilitation of electronic KYC verification for account opening and AEPS for
withdrawal of cash based biometric authentication from the UIDAI database. The PMJDY estimates opening of
accounts for at least 60 million accounts for households in villages, and approximately 25.50 million uncovered
urban households.

The PMJDY was launched by the Government on August 28, 2014 and is proposed to be implemented in two
phases:

Phase I

This phase will focus on:

(i) Universal access to banking facilities for all households through a bank branch or a fixed point business
correspondent called Bank Mitra within a reasonable distance except areas with infrastructure and
connectivity constraints;
(ii) Coverage of all households with at least one basic banking account with RuPay Debit card, with in-built
accident insurance cover of ` 1 lakh with an overdraft facility of up to ` 5,000 to Adhaar enabled accounts
after satisfactory operation in the account for 6 months;
(iii) Increase in financial literacy to cover villages in India;
(iv) expansion of direct benefit transfer under various government schemes through bank accounts of the
beneficiaries thereof; and
(v) Issuance of Kisan Credit Cards as RuPay Kisan Card.

Phase II

This phase will focus on:

(i) Provision of micro credit; and

(ii) Promotion of unorganised section pension schemes like Swavalamban through business correspondents.

According to a press release by the Ministry of Finance, GoI, around 15 million bank accounts were expected to
have opened on the launch date of the PMJDY and around 77,000 camps had been organised for such purpose.
Banks were asked to organize mega account opening camps on the day of the launch and thereafter at each rural and
urban branch in the district in coordination with district authorities for opening of bank accounts. (Source: MoF
Press Release dated August 28, 2014)

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Impact of Liberalisation on the Indian Financial Sector

Until 1991, the financial sector in India was heavily controlled and commercial banks and long-term lending
institutions, the two dominant financial intermediaries, had mutually exclusive roles and objectives and operated in a
largely stable environment, with little or no competition. Long-term lending institutions were focused on the
achievement of the Government’s various socio-economic objectives, including balanced industrial growth and
employment creation, especially in areas requiring development. Long-term lending institutions were extended
access to long-term funds at subsidised rates through loans and equity from the Government and from funds
guaranteed by the Government originating from commercial banks in India and foreign currency resources
originating from multilateral and bilateral agencies.

The focus of the commercial banks was primarily to mobilise household savings through demand and time deposits
and to use these deposits to meet the short-term financial needs of borrowers in industry, trade and agriculture. In
addition, the commercial banks provided a range of banking services to individuals and business entities. However,
since 1991, there have been comprehensive changes in the Indian financial system. Various financial sector reforms,
implemented since 1991, have transformed the operating environment of banks and long-term lending institutions.

Impact of Global Financial Crisis on India

The bankruptcy of Lehman Brothers in September 2008 led to a rapid deterioration of the global macroeconomic
environment and a sharp moderation in global economic activity. In India, this impact was felt mainly through its
trade and capital channels. As a result, there was a sharp reduction in domestic liquidity between September and
October 2008. The decline in global commodity prices led to a moderation in inflation and facilitated substantial
reductions in key policy rates and reserve requirements. The RBI reduced repo and reverse repo rates and the SLR
and CRR requirements to ease the liquidity situation, especially for non-banking financial companies and mutual
fund companies.

As reported by the RBI in its financial stability report for December 2011, the Indian banking sector is subject to
economic forces that are affecting the health of the sector as a whole. The growing linkages and integration of the
Indian economy and its financial system with the global economy are causing the banking system to face headwinds
from uncertainty related to government finances and the banking sector in the Eurozone area and the United States.
The RBI in its financial stability report for December 2012 has re-iterated that global risks remain elevated due to
delays in resolution of issues like the Eurozone debt crisis. The uncertainty of the global economic environment is
expected to continue as economic growth slows across many regions in the world. The RBI’s financial stability
report for 2011 noted that Indian banks have negligible exposures to the most affected European countries and that
direct effects from uncertainty related to the Eurozone debt crisis are expected to remain muted. However, funding
constraints in international financial markets could impact both the availability and cost of foreign funding for banks
and corporates. Further, India’s economic growth has been affected through the trade and finance channels.
Domestic demand and domestic corporate growth have recently begun to slow, while Indian interest rates have risen
and inflationary pressures have increased. According to the RBI’s financial stability report for 2012, the evolving
global risks such as the fall in global growth and sovereign risk/contagion and a host of Indian domestic factors like
the increasing Fiscal deficit, deterioration in the growth outlook and bank asset quality are the major risks to the
banking sector though the resilience of the banking system to credit, interest rate, equity and foreign exchange
shocks remain satisfactory.

Health of the financial sector in India

As reported by the RBI in its financial stability report for December 2014, the banking stability indicator suggests
that overall risks to the banking sector remained unchanged during the first half of Fiscal 2015. In individual
dimensions, though the liquidity position improved in the system, concerns remain on account of deterioration in
asset quality along with weakened soundness. The profitability dimension of the indicator showed an improvement
but it remained sluggish. The stress tests suggested that the asset quality of banks may improve in the near future
under expected positive developments in the macroeconomic conditions and banks may also be able to meet
expected losses with their existing levels of provisions. (Source: RBI Financial Stability Report, December 2014)

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Recent Developments in the Indian Banking Industry

March 2015

 The RBI issued a circular whereby it permitted banks to reverse excess provision on the sale of NPAs (sold
to securitisation companies/ reconstruction companies) wherein such sale is for a value higher than the net
book value of the NPAs.

 The RBI reduced the bank rate by 25 basis points from 8.75% to 8.50% with effect from March 4, 2015.

 The RBI reduced the repo rate (under LAF) by 25 basis points from 7.75% to 7.50% and the reverse repo
rate to 6.50% with effect from March 4, 2015.

 The RBI reduced the repo rate (under LAF) by 25 basis points from 7.75% to 7.50% and the reverse repo
rate to 6.50% with effect from March 4, 2015.

February 2015

 The RBI issued a circular whereby if has allowed overdrafts extended by banks of up to ` 5,000 in the
PMJDY accounts to be eligible for classification under priority sector advances (under the ‘others’
category), as also weaker sections, provided the borrowers household annual income does not
exceed ` 60,000 per annum for rural areas and ` 1,20,000 per annum for non-rural areas.

 The RBI issued a circular whereby it has permitted re-repo in government securities, including state
government loans and treasury bills acquired under reverse repo, subject to the following key conditions:

(i) Scheduled commercial banks and Primary Dealers maintaining subsidiary general ledger account
(“SGL”) with the RBI would be permitted to re-repo the securities acquired under reverse repo;
(ii) Mutual Funds and insurance companies maintaining SGLs with the RBI India will also be
permitted to re-repo the securities acquired under reverse repo, subject to the approval of the
regulators concerned;
(iii) Re-repo of securities can be undertaken only after receipt of confirmation/matching of first leg of
repo transaction;
(iv) Re-repo period should not exceed the residual period of the initial repo; and
(v) Eligible entities undertaking re-repo transactions should ‘flag’ the transactions as a re-repo on the
authorised reporting platform. Participants may review their systems and controls to ensure strict
compliance with the requirement of reporting of re-repo transactions.

 The RBI issued a circular whereby it provided revised guidelines on determination of base rates by
scheduled commercial banks, such guidelines including

(i) While computing base rates, where the card rate for deposits of one or more tenor is the basis, the
deposits in the chosen tenor(s) should have the largest share in the deposit base of the bank;
(ii) Banks are required to review their base rates at least once in a quarter;
(iii) Base rates methodology can be reviewed by scheduled commercial banks three years from their
finalisation; and
(iv) Banks should have a Board approved policy delineating the components of spread charged to a
customer. It should be ensured that any price differentiation is consistent with bank’s credit
pricing policy

December 2014

 The RBI issued a circular wherein it provided certain suggestions and best practises for the standardisation
in procedures relating to on-boarding of customers for mobile banking (new customers, existing account
holders whose mobile numbers are available with the bank but not registered for mobile banking, and

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 existing account holders where mobile number is not available with the bank), as also the subsequent
processes for authentication, including accessible options for generation of mobile PIN by customers.

November 2014

 The RBI issued a circular wherein it has allowed banks to extend loans to individuals against long term
infrastructure bonds issued to them by eligible banks. Boards of banks are required to lay down policies in
this regard prescribing suitable margins, purpose of the loan and other safeguards. Further, such loans
should be subject to a ceiling per borrower, and the tenure of loan should be within the maturity period of
the bonds.

August 2014

 The RBI issued a circular wherein it reduced the number of mandatory free ATM transactions at other bank
ATMs from five to three per month (inclusive for financial and non-financial transactions) for transactions
in ATMs located in the six metropolitan cities of the country. This reduction did not, however, apply to
small / no frills / basic savings bank deposit account holders who continued to enjoy five free transactions a
month.

July 2014

 The RBI has allowed banks to extend loans against pledge of gold ornaments and jewellery for purposes
other than agricultural purposes where both interest and principal are due for payment at maturity of the
loan, subject to a number of conditions, including a maximum tenor of 12 months for such loans and the
charging of interest at monthly rests provided the account is classified as a “standard” account.

 The RBI revised its guidelines on issuance of long term bonds by Banks of minimum maturity of seven
years for financing of long term infrastructure projects and affordable housing projects. Such bonds would
be fully paid up, redeemable, and unsecured, ranking pari passu with other uninsured, unsecured creditors.
There will not be any restriction on the quantum of such bonds to be issued by banks; however, the
regulatory incentives will be restricted to the bonds that are used to incrementally finance long term
projects in infrastructure and loans for affordable housing. Such bonds would be exempt from CRR/ SLR
requirements, subject to a ceiling, and would also be exempted in terms of computation of ANBC for the
purpose of priority sector lending.

May 2014

 The RBI has allowed outstanding deposits placed by scheduled commercial banks under RIDF and certain
other funds established with NABARD, on account of their shortfall in lending to priority sector as part of
indirect agriculture under priority sector classification.

April 2014

 The RBI granted “in-principle” approval to 2 out of 25 applicants to set up banks under the Guidelines on
Licensing of New Banks in the Private Sector issued on February 22, 2013. The RBI stated that its
approach was conservative and that, going forward it intended to give licences more regularly, including to
some entities whose application for a licence had been unsuccessful in this round.
 The RBI issued a circular for simplification of KYC related procedures for opening bank accounts by FPIs.
The RBI has advised that those FPIs who have been duly registered in accordance with SEBI guidelines
and have undergone the required KYC due diligence / verification prescribed by SEBI through a custodian
/ intermediary regulated by SEBI, banks may rely on the KYC verification done by the third party (i.e. the
custodian / SEBI regulated intermediary), subject to conditions laid down in the Prevention of Money
Laundering (Maintenance of Records) Rules, 2005.
 The RBI issued a circular whereby it laid down that banks, including overseas branches or subsidiaries of
Indian banks, shall not issue standby letters of credit, guarantees, letter of comforts on behalf of overseas

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 joint ventures, wholly owned subsidiaries or wholly owned step-down subsidiaries of Indian companies for
the purpose of raising loans or advances of any kind from other entities except in connection with the
ordinary course of overseas business. Further, while extending fund or non-fund based credit facilities to
aforementioned entities in connection with their business, either through branches in India or through
branches or subsidiaries abroad, banks should ensure effective monitoring of the end use of such facilities
and its conformity with the business needs of such entities.

May 2014

 The RBI issued a circular whereby it has decided to include the outstanding deposits placed by SCBs under
the RIDF and certain other funds established with NABARD under priority sector classification. The
change was made on account of SCBs shortfall in lending to the priority sector as part of indirect
agriculture under the priority sector classifications. Accordingly, the outstanding deposits as of March 31 of
the current year under RIDF, the Warehouse Infrastructure Fund, the Short Term Co-operative Rural Credit
Refinance Fund and the Short Term RRB Fund with NABARD will be treated as part of indirect
agriculture and will count towards overall priority sector target achievement. The outstanding deposits
under the above funds with NABARD as on the preceding March 31 will form part of ANBC.

October 2014

 The RBI issued clarifications to banks with regards to the total number of free ATM transactions that banks
have to provide to their customers when using another bank's ATM effective from November 1, 2014,
onwards. The minimum number of free ATM transactions is three if the customer uses another bank's ATM
located in Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad. If the ATM transactions are
carried at the aforementioned locations and other locations, the total number of free ATM transactions is
five. Banks are, however, free to offer any number of free ATM transactions per month so long as the
abovementioned required minimum is met.

 With respect to the guidelines on joint lenders' forums ("JLF") and corrective action plan ("CAP"), the
RBI has decided the following:

(i) Banks will be permitted to report their SMA-2 accounts and JLF formations on a weekly basis at
the close of business on Friday, except where Fridays are a public holiday.
(ii) Crop loans are exempted from reporting credit information to the Central Repository of
Information on Large Credits.
(iii) The time limit for a JLF to agree upon the option to be adopted in the CAP has been increased to
45 days.
(iv) The time limit for independent evaluation committees to evaluate and provide recommendations
for the restructuring of accounts with aggregate fund based and non-fund based exposure of `
5.00 billion and above has been increased to 45 days.
(v) Accounts that are in the books of escrow maintaining banks will be subject to accelerated
provisioning.
(vi) If restructuring has been decided by the JLF as the option for the CAP, banks will not be permitted
to sell its assets to securitization or reconstruction companies without first arranging for additional
finance with a new or existing creditor.

November 2014

 The RBI has issued its final guidelines on monitoring tools for intraday liquidity management whereby
banks will be required to report its monitoring tools to the RBI on a monthly basis starting January 1, 2015.
 The RBI has issued an indicative list of preventive measures against cheque related fraud for banks. The
list includes strengthening the bank's infrastructure in all its cheque handling branches, ensuring that
beneficiaries are KYC compliant and close monitoring of credits and debits in newly opened accounts
depending on the risk categorization of the account. Preventive measures for dealing with suspicious or
large value cheques include alerting the customer by phone call of such transactions, getting confirmation

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 from the payer or drawer and contacting the main branch to clear non-home cheques.
 The RBI issued a circular stating that the updated statement by the financial action task force on
"Improving Global Anti-Money Laundering / Combating of Financing of Terrorism: on-going process”
does not preclude Indian banks or financial institutions from continuing to transact business with the
countries indicated in the statement, including Afghanistan, Cambodia, Iraq, Sudan, Syria, Yemen and
Zimbabwe, among others.

Future Developments in the Banking Sector and Expected Domestic Reforms

Implementation of the Basel III capital regulations

In December 2010, the BCBS issued a comprehensive reform package of capital regulations, Basel III. The
objective of the reform package is to improve the banking sector’s ability to absorb shocks arising from financial
and economic stress, thus reducing the risk of spill over from the financial sector to the real economy. The RBI
issued the RBI Basel III Capital Regulations and the guidelines became operational from April 1, 2013 (Source RBI
Press Release dated 28 December 2012 available at http://www.rbi.org.in as of February 15, 2013.). However, the
reform package and guidelines will be implemented in a phased manner. On December 31, 2013, the RBI further
extended the implementation of credit valuation adjustment risk to April 1, 2014; and, on March 27, 2014, extended
the deadline for full implementation of Basel III requirements to March 31, 2019. (Source: RBI Circular dated
December 31, 2013 and RBI Circular dated March 27, 2013)

Under Basel III, total capital of a bank in India must be at least 9.00% of RWAs (8.00% as specified by the BCBS),
Tier I capital must be at least 7.00% of RWAs (6.00% as specified by the BCBS) and Common Equity Tier I capital
must be at least 5.50% of RWAs (4.50% as specified by BCBS). Due to the transitional arrangements, the capital
requirements of banks may be lower during the initial periods and higher during later years. Therefore, banks have
been advised to do their capital planning accordingly. In addition to the minimum requirements as indicated above, a
CCB, in the form of common equity of 2.50% of RWAs, is required to be maintained by banks. Under the RBI
Basel III Guidelines, total capital with CCB has been fixed at 11.50% of RWAs.

Further, under Basel III, a simple, transparent, non-risk based leverage ratio has been introduced. The BCBS will
test a minimum Tier I leverage ratio of 3.00% during a parallel run period from January 1, 2013 to January 1, 2017.
The RBI has prescribed that during this parallel run period, banks should strive to maintain their existing leverage
ratios, but in no case should a bank’s leverage ratio fall below 4.50%. Banks whose leverage is below 4.50% have
been advised to achieve this target as early as possible. This leverage ratio requirement is yet to be finalised and will
be finalised taking into account the final proposals of the BCBS. (Source: RBI Annual Report 2011-2012.)

While all 27 jurisdictions that comprise the Basel Committee had implemented Basel III capital regulations as at
April 2014, India implemented Basel III with a delay of three months (from April 1, 2013 instead of January 1, 2013
as originally scheduled) to align the implementation schedule with the beginning of the financial year. The RBI has
extended the end date for full implementation of Basel III capital regulations by one year (to March 31, 2019) to
provide some lead time to banks on account of potential stresses on asset quality and consequential impact on the
performance/ profitability of the banks. With the extension, full implementation of Basel III in India will slightly
exceed the internationally agreed end date of January 1, 2019. (Source: RBI Annual Report 2013-2014)

The following table sets out the transitional arrangement for the implementation of various minimum capital ratios:

Transitional Arrangements-Scheduled Commercial Banks

(excluding LABs and RRBs)
(% of RWAs)
Minimum April 1, March 31, March 31, March 31, March 31, March 31, March 31,
capital ratios 2013 2014 2015 2016 2017 2018 2019
Minimum 4.5 5 5.5 5.5 5.5 5.5 5.5
Common
Equity Tier 1
Capital - - - 0.625 1.25 1.875 2.5
(CET1)
conservation
buffer
Minimum(CCB)
CET1+ 4.5 5 5.5 6.125 6.75 7.375 8
CCB

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 Minimum April 1, March 31, March 31, March 31, March 31, March 31, March 31,
capital ratios 2013 2014 2015 2016 2017 2018 2019
Minimum Tier 1 6 6.5 7 7 7 7 7
capital
Minimum Total 9 9 9 9 9 9 9
Capital(1) Total
Minimum 9 9 9 9.625 10.25 10.875 11.5
Capital
+CCB
Phase-in of all 20 40 60 80 100 100 100
deductions from
CET1 (in %)(2)
Notes: (1) The difference between the minimum total capital requirement of 9% and the Tier 1 requirement can be met with Tier 2 and higher
forms of capital.
(2) The same transition approach will apply to deductions from Additional Tier 1 and Tier 2 capital.

(Source: RBI’s Circular dated March 27, 2014 – Implementation of Basel III Capital Regulations in India – Capital
Planning)

Dynamic provisioning guidelines

At present, banks generally make two types of provisions; general provisions on standard assets and specific
provisions on NPAs. Since the level of NPAs varies through the economic cycle, the resultant level of specific
provisions also behaves cyclically. Consequently, lower provisions during upturns and higher provisions during
downturns have a pro-cyclical effect on the real economy.

To address the pro-cyclicality of capital and provisioning, efforts at an international level are being made to
introduce countercyclical capital and provisioning buffers. The RBI has prepared a discussion paper on a
countercyclical (dynamic) provisioning (“DP”) framework.

The DP framework is based on the concept of expected loss, or “EL”, which is the average level of losses a bank can
reasonably expect to experience, and is considered the cost of doing business. It is generally covered by provisioning
and pricing. The objective of DP is to soften the impact of incurred losses on the results of operations through the
economic cycle, and not to provide a general provisioning cushion for EL. More specifically, the DP created during
a year will be the difference between the long run average EL of the portfolio for one year and the incremental
specific provisions made during the year. The parameters of the model suggested in the discussion paper are
calibrated based on data of Indian banks. Banks that have the capability to calibrate their own parameters may, with
the prior approval of the RBI, introduce a DP framework using the theoretical model indicated by the RBI. Other
banks will have to use the standardised calibration provided by the RBI. (Source: RBI Annual Report 2011-2012 and
Discussion Paper on Introduction of Dynamic Loan Loss Provisioning Framework for Banks in India dated March
30, 2012.)

Financial Sector Legislative Reforms Commission (“FSLRC”)

The FSLRC was constituted on March 24, 2011 to redraft and harmonise legislation related to the financial sector.
(Source: RBI Report on Trend and Progress of Banking in India 2011-12.)

In its approach paper released on October 1, 2012, the FSLRC has proposed a two-agency regulatory model; the
RBI as the monetary authority, banking regulator and payment systems regulator, and a single regulator for the rest
of the financial sector. This approach paper is currently in draft form. (Source: FSLRC, Ministry of Finance,
Approach Paper and Press Release available at http://www.fslrc.org.in as of January 10, 2013.)

Bank Holding Company or Financial Holding Company (“BHC” or “FHC”)

In June 2010, the RBI set up a working group to examine the different holding company structures prevalent
internationally in the financial sector and to examine the feasibility of introducing an FHC structure in India. FHCs
are companies that own or control one or more banks or NBFCs. Currently, banks in India are organised under a
bank-subsidiary model, or “BSM”, in which the bank is the parent of all the subsidiaries of the group. In May 2011,
the RBI released the working group’s recommendations that included, among others, that the FHC model should be

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pursued as a preferred model for the financial sector in India and that the RBI should be designated as the regulator
for FHCs. The recommendations have currently not been implemented. (Source: RBI Report of the Working Group
on Introduction of Financial Holding Company Structure in India and Press Release available at
http://www.rbi.org.in as of January 10, 2013.)

Future Outlook and Key Trends

Going forward, banks will need to move towards the mandated higher capital standards, stricter liquidity and
leverage ratios and a more cautious approach to risk. This implies that Indian banks will need to improve efficiency
even as their costs of doing business increase. They will need to refine their risk management skills for enterprise-
wide risk management. In addition, banks need to have in place a fair and differentiated risk pricing of products and
services, since capital comes at a cost. This involves costing, a quantitative assessment of revenue streams from each
product and service and an efficient transfer-pricing mechanism that would determine capital allocation.

During Fiscal 2013, NPAs have risen. The slippage ratio of the banking system, which showed a declining trend
during Fiscals 2005-2008, further increased during Fiscals 2009-2014. Banks need to not only utilise effectively the
various measures put in place by the RBI and the Government for the resolution and recovery of bad loans, but also
strengthen their due diligence, credit appraisal and post sanction loan monitoring systems to minimise and mitigate
the problem of increasing NPAs.

Going ahead, banks need to tap into untapped business opportunities for resources to increase growth, such as
targeting small customers. The challenge before banks is to make the best use of technology and innovation to bring
down intermediation costs while protecting their bottom lines. The recent regulatory initiatives such as the
deregulation of savings bank deposit interest rates and opening up Government business to more banks, imminent
steps, such as licensing of new banks and subsidiarisation of the foreign bank branches, on the one hand, and the
changing profile and simultaneously rising aspirations and expectations of customers on the other, should make the
industry more competitive and increasingly, a buyers’ market. As the Indian banking sector is propelled forward,
banks have to strive to remain relevant in the changing economic environment by reworking their business strategy,
designing products with the customer in mind and focusing on improving the efficiency of their services. The
challenge for Indian banks is to reduce costs and pass on the benefits to both depositors and lenders. (Source: RBI
Report on Trend and Progress of Banking in India 2011-12.)

Impact of the budget for Fiscal 2016

The Union budget for Fiscal 2016 has introduced a number of proposals that could significantly impact the
commercial banking industry:

(i) Gold deposit schemes to mitigate the burgeoning gold demand;

(ii) Incentivizing transaction through plastic money;
(iii) Qualitative implications including proposals to frame a bankruptcy law and dispute settlement, as well as a
move to align NBFCs with other financial institutions;
(iv) Establishment of an autonomous Bank Board Bureau which is expected to have a multiplier impact on the
economy;
(v) Allocation of additional resources for the infrastructure sector, through levy of additional customs and
excise duties on petrol and high speed diesel oil;
(vi) Increased outlays on roads and gross budgetary support to the railways;
(vii) Establishment of a national infrastructure investment fund with an annual corpus of ` 200,000 million
therein;
(viii) Setting up of five ultra mega power projects of 4000 MW each in plug-and-play mode, which is estimated
to garner investments of over `1,000,000 million;
(ix) Introduction of a gold monetisation scheme and a sovereign gold bond; and
(x) Proposals that will incentivize credit and debit card transactions.

(Source: Budget Speech, Union Budget of 2015-2016)

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 OUR BUSINESS

Overview

We are one of the oldest private sector banks in India with a history of over 94 years, and a strong base in Kerala
along with significant presence in Tamil Nadu, Karnataka and Maharashtra. We offer a wide range of products and
services, with particular focus on small and medium enterprises (“SME”), retail and NRI customers. We deliver our
products and services through multiple channels, including 431 branches (comprising five service branches) and 232
ATMs spread across 15 states and four union territories and cater to an overall customer base of 1.61 million as on
December 31, 2014.

While our Bank has a long operating history as a traditional bank, we are currently focusing on initiatives to
transform ourselves into a full service contemporary bank. To this end, we have recently undertaken a number of
initiatives to enhance our business focus by upgrading processes, technology and human resources. As part of our
transformation, we are in the process of organizing our operations under focused business areas; re-aligning,
training and incentivizing employees; creating new products and services; increasing sales and marketing efforts;
investing in technology and strengthening our monitoring and risk management policies.

We have four principal business areas, namely, (a) SME banking, (b) retail banking, (c) corporate banking, and (d)
treasury operations.

Under our SME banking business, we cater to small and medium manufacturing units, services and trading
companies, with borrowing needs up to ` 250 million. We offer a wide range of products including term loans, cash
credit, working capital finance, foreign currency loans, export credit, bill discounting, letters of credit and bank
guarantees. We believe that lending to SME customers enables us to diversify our credit risk due to relatively
smaller individual exposures. SMEs offer comparatively higher yields, cross-selling and associated business
opportunities, along with higher degree of secured and collateralized loans and also enable us to meet our priority
sector targets. As on December 31, 2014, our Bank has 382 branches in metro, urban and semi urban locations,
which we believe are conveniently located in close proximity to a large proportion of our existing and target SME
customer base. Further, in order to reduce our turnaround time, we have decentralized our credit process by
establishing eight regional credit hubs for proposals within the lending power of the branches and zonal offices and
one central credit hub for proposals under the head quarter lending powers. As a percentage of our total advances,
loans to SME customers accounted for 33.41%, 40.40% and 43.18% as on March 31, 2013, March 31, 2014 and
September 30, 2014, respectively.

Under our retail banking business, we offer a wide range of loan and deposit products to our retail and NRI
customers, such as gold loans, loans against properties, personal loans, housing loans and agricultural loans, and
deposit products such as current accounts, savings accounts, term deposits and cumulative deposit accounts. Gold
loan advances constituted 38.31%, 32.04% and 29.54% of our total advances as on March 31, 2013, March 31, 2014
and September 30, 2014 and continues to be a mainstay for our Bank on the retail advances side. On the deposits
side, NRI deposits have been a stable source of funding for our Bank constituting 13.47%, 17.27% and 18.50% of
our total deposits as on March 2013, 2014 and September 30, 2014, and has grown at a CAGR of 33.43% during the
last three Fiscals. For facilitating fund transfer services required by our NRI customers, we have remittance and
rupee drawing arrangements with 14 exchange houses in the Middle East. We also have tie ups with major money
transfer agents including Wall Street Finance Limited, MoneyGram Payment Systems Inc, Weizmann Forex Ltd and
UAE Exchange & Financial Services Ltd, which enhances our capability to provide international remittance services
and strengthens our NRI business.

Our retail banking business also includes financial inclusion products, as well as fee income from distribution of
third-party products such as life insurance and general insurance. We distribute life insurance products of Edelweiss
Tokio Life Insurance Company Limited, and are in the process of finalizing an agreement with a leading general
insurance company for distributing general insurance products. As a percentage of our total advances, retail banking
advances accounted for 50.79%, 45.57%, and 43.66%, as on March 31, 2013, March 31, 2014 and September 30,
2014, respectively.

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Under our corporate banking business, we cater to companies with an annual turnover of over ` 1,000 million (with
credit requirement of above ` 250 million). As a percentage of our total advances, corporate banking advances
accounted for 15.80%, 14.03%, and 13.16% as on March 31, 2013, March 31, 2014 and September 30, 2014,
respectively.

Our treasury operations primarily consist of statutory reserves management, liquidity management, investment and
trading, and money market and foreign exchange activities. Our treasury operations are aimed at maintaining an
optimum level of liquidity, while complying with the RBI mandated cash reserve ratio and the statutory liquidity
ratio. We maintain SLR through a portfolio of central Government, state Government, corporate debt and trustee
securities that we actively manage to optimize yield and benefit from price movements. We are also involved in the
trading of securities and foreign exchange, and invest in sovereign debt instruments, commercial papers, mutual
funds, certificates of deposits, floating rate instruments, bonds and debentures to manage short-term surplus liquidity
and further optimize yield and to generate profits thereon.

As on December 31, 2014, we have a network of 431 branches and 232 ATMs. Out of our 431 branches, 55
branches are in metropolitan cities, 102 branches in urban areas, 225 branches in semi-urban and 49 branches in
rural areas. For efficient administration, we have organized all our branches under nine zonal offices. We deliver
our products and services through multiple delivery channels that include branches, ATMs, internet and mobile
banking.

Our total assets have increased from ` 119,754.07 million as on March 31, 2012 to ` 134,486.34 million as on
March 31, 2013, to ` 151,653.82 million as on March 31, 2014, at a CAGR of 12.53%. Our total deposits have
increased from ` 106,048.70 million as on March 31, 2012 to ` 123,416.26 million as on March 31, 2013, to `
136,738.61 million as on March 31, 2014, at a CAGR of 13.55%. During the same period, our total advances have
increased from ` 77,676.90 million as on March 31, 2012 to ` 89,759.71 million as on March 31, 2013, and
decreased slightly from this level to ` 88,540.20 million as on March 31, 2014, at a CAGR of 6.76%. Our total
assets, total deposits and total advances as on September 30, 2014 are ` 155,494.28 million, ` 141,655.02 million
and ` 96,087.65 million, respectively.

Our total income (interest income plus other income) increased from ` 11,607.95 million in Fiscal 2012, to `
14,154.30 million in Fiscal 2013 to ` 16,212.96 million in Fiscal 2014, at a CAGR of 18.18%. During the same
period, our net profit after tax increased from ` 260.44 million in Fiscal 2012, to ` 266.17 million in Fiscal 2013, to
` 309.46 million in Fiscal 2014, at a CAGR of 9.01%. Our total income and net profit after tax for the six months
ended September 30, 2014 are ` 8,162.74 million and ` (181.47) million respectively. As on September 30, 2014,
our CRAR, Tier 1 Capital and Tier 2 Capital was 9.87%, 7.96% and 1.91%, respectively as per Basel – II, and
9.72%, 7.87% and 1.85% respectively as per Basel – III. In order to augment our capital base, we raised ` 613.10
million through preferential allotment of Equity Shares to investors, in October 2014, followed by a rights issue to
existing Shareholders in March 2015, where we raised Equity capital to the tune of ` 1,131.33 million.

OUR COMPETITIVE STRENGTHS:

We believe that the following strengths distinguish us in a competitive Indian banking industry:

Strong and trusted brand in south India

With over 94 years of history, we believe we have developed a well-recognized and trusted brand in south India,
particularly in the states of Kerala, Tamil Nadu and Karnataka where we have built strong relationships with many
of our customers, which has been one of our key growth drivers. We believe that we are known for the quality of
service we have provided to our customers over the years and for our consistent approach to developing long-term
relationships with our customers, based on our local knowledge and experience amongst other things. We believe
that our strong customer and neighbourhood centric focus, has played a significant role in enhancing customer
service experience and maintaining customer loyalty, on account of which we have been long-term bankers to a
significant number of our SME customers. As on September 30, 2014, on the advances side, we had 3,899 SME
customers who have been our customers for over five years contributing 45.40 % of our total SME advances.

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We believe that the trust reposed in our brand has enabled us in developing and maintaining a robust and loyal
deposit franchise, consisting of a distinctive clientele, including numerous churches, charitable trusts, welfare
boards, temple trusts, and educational institutions. Further, our strong gold portfolio is also a testimonial to the trust
placed in our brand by the customers.

Focus on the SME business

We believe that SMEs are often confronted with challenges as compared to large corporates, such as availability of
adequate and timely financial resources. We focus on meeting the funding and banking requirements of these SME
customers so as to ensure that their business continues seamlessly. As a percentage of our total advances, loans to
SME customers accounted for 33.41%, 40.40%, and 43.18% as on March 31, 2013, March 31, 2014 and September
30, 2014, respectively.

We believe that lending to SMEs enables us to diversify our credit risk profile due to relatively smaller individual
exposures. As on September 30, 2014, our advances to SME customers aggregated to ` 41,493.58 million, spread
across 10,581 advance accounts. Further, as on September 30, 2014, working capital advances such as cash credit
and overdraft facilities, constituted 78.63% of our total advances to our SME customers, while the remaining
21.37% were contributed by term loans.

SMEs offer comparatively higher yields, cross-selling and associated business opportunities, and higher degree of
secured and collateralized loans. As on September 30, 2014, 98.66 % of our SME loan portfolio is secured. Lending
to SMEs also provides us a good geographic spread and helps us meet our priority sector lending targets.

As on December 31, 2014, we have 382 branches in metro, urban and semi urban locations which we believe are
conveniently located in close proximity to a large proportion of our existing and target SME customer base. To
enhance our sales and marketing efforts, we have established a separate team focusing on SME business with
designated team leaders in every zone, assisting the branches to source additional business and achieve deeper
penetration. We synergistically leverage our branch network, the expertise of our branch managers and the SME
team to create a customer-centric culture, where the emphasis is to satisfy the complete banking and financial needs
of our SME customers by offering them a portfolio of products and services, customized and tailor-made to their
specific requirements. Further, in order to reduce our turnaround time, we have decentralized our credit process by
establishing eight regional credit hubs for proposals within the lending power of the branches and zonal offices and
one central credit hub for proposals under the head quarter lending powers.

We believe our branch-centric business model combined with local experience, long-standing client relationships,
customer service quality and streamlined organizational structure allows us to respond faster and suitably to the
needs of our SME customers.

Retail offering focused on gold loans and NRI business

We have wide presence in south India, with 365 of our 431 branches located in the states of Kerala, Tamil Nadu,
Karnataka, Andhra Pradesh and Telangana, as on December 31, 2014. Of these 365 branches, we have 282 branches
in Kerala, 58 branches in Tamil Nadu, 16 branches in Karnataka, six branches in Andhra Pradesh and three branches
in Telangana. In order to drive penetration, we have strategically opened over 40 branches in these five states in the
last three Fiscals.

South India as a region continues to be the largest consumer of gold in India with the southern states accounting for
over 40% of India’s overall gold demand, followed by the west (25%), north (20-25%) and east (10-15%) (Source:
(Source: RBI Report of the Working Group to Study the Issues Related to Gold Imports and Gold Loans by NBFCs,
January 2013). Gold loans constituted a major portion of our advances, contributing 38.31%, 32.04%, and 29.54%
of our total advances as on March 31, 2013, March 31, 2014 and September 30, 2014, respectively. As on
September 30, 2014, we had 449,436 gold loan accounts, with advances aggregating to ` 28,383.01 million,
implying an average ticket size of ` 0.06 million. Apart from liquidity of the security and low probability of credit
losses, gold loan advances offer benefits of hassle free lending and lower operational costs.

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Kerala has a large population of NRIs, where our extensive branch network provides us an opportunity to build
strong portfolio of NRI deposits. NRI deposits have been a stable source of funding for our Bank, constituting
13.47%, 17.27% and 18.50% of our total deposits as on March 31, 2013, March 31, 2014 and September 30, 2014,
respectively, and have grown at a CAGR of 33.43% during the last three Fiscals. For facilitating fund transfer
services required by our NRI customers, we have remittance and rupee drawing arrangements with 14 exchange
houses in the Middle East. We also have tie ups with major money transfer agents including Wall Street Finance
Limited, MoneyGram Payment Systems Inc, Weizmann Forex Ltd and UAE Exchange & Financial Services Ltd,
which enhances our capability to provide international remittance services and strengthens our NRI business.

Professional and experienced management

We are a professionally managed Bank. The members of the Board have significant finance and banking experience
and include associates of the Indian Institute of Banking, Chartered Accountants and retired IAS officers. The part-
time Chairman of our Bank, Mr. S. Santhanakrishnan, has been a fellow of the Institute of Chartered Accountants of
India for over 30 years and is a practicing Chartered Accountant. Several of our Directors are also on the Board of
other reputed companies. Our Board of Directors and the Key Managerial Personnel have been responsible for
undertaking a number of change initiatives to enhance the business focus of the Bank by upgrading processes,
technology and human resources.

Our Key Managerial Personnel bring substantial experience and in-depth knowledge of banking operations and
management. While several of our Key Managerial Personnel have been with our Bank since the 1980s, we have
also brought in other experienced professionals from the banking industry and our Key Managerial Personnel have
an average banking experience of 23 years. We believe that our management’s capabilities, strong reputation,
extensive network of industry relationships and wide-ranging experience in the finance and banking industry will
continue to help us to grow, modernize and develop further. For further details please refer the section titled “Our
Management” on page 172.

Streamlined risk management controls, policies and procedures

We have instituted prudent risk management controls, policies, and procedures that are critical for the long-term
sustainable development of our business. We have implemented risk management procedures for our credit
exposures, including credit evaluation, credit scoring, risk based pricing models, and risk monitoring and control
mechanisms. We have developed our own credit risk rating framework in terms of which all exposures of ` 2.50
million and above are brought within a rating mechanism. The rating framework incorporates, inter-alia, financial
analysis and sensitivity, industrial and management risks. A separate risk management department formulates and
implements credit risk evaluation, approves risk management framework and policies, oversees the credit approval
process and periodically reviews the same so as to ensure that the business conducted is consistent with our risk
appetite, with a focus on maintaining and enhancing asset quality. Further, retail lending is parameterized based on
an internally developed framework. We periodically conduct audits/inspections to ensure that the risks on our
portfolios are within acceptable parameters. We continuously monitor our portfolios through our internal control
system, which includes macro level portfolio analysis, migration of credit rating analysis and stress testing analysis.

Our credit risk policy is periodically reviewed and updated to incorporate changes in the environment, market and
regulatory guidelines. We have an asset liability management committee for managing market risk; credit risk
management committee for credit risk; and operations risk management committee for operations risk. We are
focused on maintaining high standards of asset quality through risk management and mitigation practices.

We also manage risk by ensuring that our advances are adequately secured. As on March 31, 2013, March 31, 2014
and September 30, 2014, 96.48 % (i.e., ` 85,395.26 million), 96.34% (i.e., ` 83,888.90 million) and, 95.62% (i.e.,
` 90,176.29 million), respectively, of our advances were secured.

BUSINESS STRATEGIES:

Continue to focus on SME customers

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Small enterprises play a very significant role in terms of balanced and sustainable growth of the economy. Small
enterprises contribute 38% of the manufacturing output and around 40% of the total export of the country providing
employment to nearly 106 million people through about 46 million units, located in both the rural and urban areas
across the country (Source: Ministry of Micro, Small and Medium Enterprises, Annual Report 2013-2014)). Our
SME advances constituted 43.18% of our total advances, as on September 30, 2014. We believe that with our strong
relationships with SME customers and the strategic location of our branches, we are well placed to reap the benefits
of growth in this sector.

We intend to remain focused on SME customers by providing them support through the life cycle of their business -
from inception to expansion including modernization of their businesses. We aim to use our in-depth knowledge and
local experience of banking requirements of SMEs to grow in sectors that we believe have good growth potential
such as healthcare, education, real estate, textiles, agriculture, infrastructure, food processing and fisheries and
formulate specific products, services, processes and delivery capabilities to cater to the requirements of SME
customers. We intend to increase our bouquet of offerings to our SME customers by providing them additional
service offerings such as cash management, foreign exchange, point-of-sale services. We are also continuously
working to refine our business model to promptly respond to the needs of our SME customers, while maintaining
and ensuring adequate risk management. In addition to growing our advances, we intend to mobilize low cost CASA
deposits, as also increase cross selling to augment our fee-based income from SME customers. We believe that
growth in advances to SME customers helps us in increasing our net interest margins as well as diversifying our
advances portfolio thereby reducing risks.

We aim to maximize the value of our small business relationships by leveraging our distribution network and
infrastructure, effective use of technology, speedy response and quality service and also by continuously upgrading
our products and services. To expand our SME business, we also aim to appoint relationship officers as part of our
recently created SME team, to assist our branches. We intend to further augment our specialized SME team, both in
terms of manpower and expertise, and strengthen our marketing and client out-reach efforts through our branch
managers, who are an integral part of our business development initiatives, in order to source additional business
and drive further penetration.

Grow retail business

The consumer credit market in India has undergone a significant transformation over the last decade and has
experienced rapid growth due to consumer credit becoming cheaper, more widely available and increasingly a more
acceptable avenue of funding for consumers. During Fiscal 2014, Indian banks’ retail loans portfolios continued to
growth rapidly and total retail loans increased by 15.4% from November 2013 to November 2014, mainly led by
growth in housing loans as the largest segment of retail loans and an increasing growth in auto loans. (Source: RBI,
Press Release, Sectoral Deployment of Bank Credit – November 2014). We intend to capitalize on the opportunity
presented by retail banking, by enhancing our products, services offering and customer delivery capabilities.

As part of our overall retail strategy, we intend to invest in further strengthening our brand, which may include
changes to our brand identity, augmenting our technology capabilities, selectively upgrading our branch
infrastructure, enhancing capabilities across alternate delivery channels, setting up a customer call centre, and by
migrating certain operational activities from the branches to a central unit.

CASA is the prime source of low cost funds for us. As on September 30, 2014, our CASA deposits were
` 25,448.41 million representing 17.96% of our total deposits. We seek to augment our CASA deposits in order to
reduce cost of funds and improve our core capital. We propose to increase our CASA by launching deposit products
across business, enhancing our brand presence, attracting new retail customers, appointing relationship managers for
high net worth customers, introducing loyalty programs, expanding our ATM coverage, and enhancing mobile and
internet banking platforms.

In order to further grow our retail loan portfolio and diversify our loan portfolio mix, we intend to increase
marketing and sales resources at our branches, launch new products (including new variants for loan against
properties and gold loans), invest in technology for speedier credit processing and improved monitoring, and cross
sell products like life insurance to our existing customers. Our flagship product in loan against property- “property
encash” was recently launched. Our loan against property products are being positioned for meeting the specific

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funding requirements of our retail customers, small business owners and entrepreneurs, thereby augmenting our
portfolio of key offerings in the retail business. As on March 31, 2014, the net LAP advances stood at ` 697.80
million, which have increased significantly to ` 1,143.40 million, as on September 30, 2014. We shall continue to
drive penetration of our LAP product, by leveraging on the strength of our customer relationships and distribution
network.

Increase NRI business

Our NRI deposits have grown from ` 9,940.61 million in Fiscal 2011 to ` 23,616.20 million in Fiscal 2014, at a
CAGR of 33.43% during the same period, which is more than twice the growth experienced in our total deposits
during the same period. As on March 31, 2013, March 31, 2014 and September 30, 2014, our total NRI deposits
constituted 13.47 %, 17.27 % and 18.50 %, respectively, of our total deposits. We intend to continue to focus on
increasing our NRI deposit base, which has been one of our key growth engines on the deposit side, and has also
proved to be a stable source of funding for our Bank.

We have created a separate NRI product management team, and are focused on augmenting our NRI business in
addition to our branches, all of which are equipped to offer specialized services to our NRI customers. The NRI
team extends comprehensive support to our branches in all NRI related matters and drives the growth of our NRI
business, with special emphasis on increasing our share of inward remittances and deposits from the Middle East, by
leveraging our strong customer base and distribution network in Kerala. We have remittance and rupee drawing
arrangements with 14 exchange houses in the Middle East and tie ups with major money transfer agents, which we
plan to expand further. Further, we aim to offer products and services based on customer segmentation, provide
wealth management services advisory services and differentiated products to high net worth customers, appoint
dedicated relationship managers and create exclusive NRI customer service areas in select branches. We also intend
to enter into strategic partnerships to acquire, engage and service NRI customers in the Middle East.

Increase fee and non-fund based revenues

An important strategic focus for us is to grow our fee and non-fund based revenues. Our fee and non-fund based
revenues constituted 3.47%, 3.27% and 3.68% of our total revenue for Fiscals 2013, 2014 and for six months ended
September 30, 2014, respectively. We believe that our increased focus on retail and SME customers, integrated
branch network, technology led channels and increasingly diversified product mix will enable us to increase our fee
and non-fund based revenues.

To our existing SME customers, we aim to market fee and non-fund based products such as letters of credit, bank
guarantees, foreign exchange services and insurance products. We also intend to acquire new SME customers who
specifically require such fee and non-fund based products. For our retail customers, we intend to follow a
relationship based approach by providing and expanding our third party product offerings including mutual fund and
insurance products, wealth management services, money transfer and foreign exchange services.

We have entered into a corporate agency agreement with Edelweiss Tokio Life Insurance Company Limited to
distribute life insurance products. Further, we are in the process of finalizing an arrangement with a leading general
insurance company to distribute general insurance products. These arrangements will further enable us enhance our
sales and distribution capabilities for growing the bancassurance business, and driving penetration. We intend to
further increase this revenue stream by entering into more agency and distribution arrangements and enhancing our
products and services offerings. We currently have over 50 employees involved in selling these insurance products
who have been authorized by the IRDA to act as specified persons for selling insurance products and we intend to
increase the number of such employees to augment our sales and marketing capabilities.

We earn commission on the fund transfer services provided by us to our NRI customers for which we have
remittance and rupee drawing arrangements with 14 exchange houses in the Middle East. We also have tie ups with
major money transfer agents including Wall Street Finance Limited, MoneyGram Payment Systems Inc, Weizmann
Forex Ltd and UAE Exchange & Financial Services Ltd. We plan to enter into many more of such agreements to
further enhance our capability to provide international remittance services and strengthens our NRI business and
consequently increase our earnings from the commission on NRI remittances and money transfers services.

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Efficiently manage NPAs and continue to focus on strengthening risk management

The share of gross NPAs as a percentage of total advances increased from 2.35% as on March 31, 2013 to 3.77% as
on March 31, 2014 and was 5.56% as on September 30, 2014. The share of net NPAs as a percentage of total
advances increased from 1.12% as on March 31, 2013 to 2.22% as on March 31, 2014 and was 3.76% as on
September 30, 2014. The increase in NPA during Fiscal 2014 is primarily attributable to the impairment of certain
corporate loans. The reduction and recovery of impaired assets is our key focus area. We continuously evaluate
various aspects of our credit and risk management, including origination, monitoring and recovery of loans. These
efforts are supervised by our executive and Board committees.

We are committed to efficiently managing and reducing our NPAs, as well as stressed assets, and are implementing
measures to manage and reduce our NPAs. In relation to origination and appraisal of our loans, we propose to
continuously review and upgrade our rating models, scorecards and credit approval process, including training and
enhancing our resources.

We have recently implemented monitoring systems to identify potential problem loans by continuously tracking our
portfolio through a dedicated monitoring team. Further, for SME loans above a defined threshold, the dedicated
relationship managers support our branches to engage with customers on a continuous basis in order to initiate
remedial measures based on early warning signs.

We have recently created a dedicated recovery team which organizes recovery camps, enters into compromises and
settlements, engages recovery agents, and evaluates and undertakes timely and appropriate legal action (including
invocation of the SARFAESI Act, initiating recovery suits, and resorting to Government-supported revenue
recovery proceedings). Further, where we deem appropriate, we sell our stressed or impaired assets to ARCs.

In addition, we are currently in the process of appointing an external agency to assist us with upgrading all aspects
of credit and risk management, including origination, credit processing, monitoring and recovery.

OUR BUSINESSES

Our business is principally organized as: (a) SME banking, (b) retail banking, (c) corporate banking, and (d)
treasury operations.

The following table sets forth the composition of our total advances by different businesses as on March 31, 2012,
2013 and 2014 and as on September 30, 2014.

Businesses As on March 31, As on September 30,

2012 2013 2014 2014
(% of total advances)
SME banking 35.27 33.41 40.40 43.18
Retail banking 44.44 50.79 45.57 43.66
Corporate banking 20.29 15.81 14.03 13.11
Total Gross Advances 77,676.90 89,759.70 88,540.19 96,087.65
(in ` million)

The following table sets forth the composition of our total deposits as on March 31, 2012, 2013 and 2014 and as on
September 30, 2014.
(In ` million)
Particulars Total Deposits as on
March 31, 2012 March 31, 2013 March 31, 2014 September 30, 2014
Corporate 20,495.00 27,240.70 28,966.40 29,090.60
Retail 65,070.14 74,541.61 84,162.38 87,116.01
Total term deposits 85,565.14 101,782.31 113,128.78 116,206.61
Current account 3,478.59 3,293.55 3,314.45 3,895.03
Savings account 17,004.97 18,340.40 20,295.38 21,553.38
Total CASA 20,483.56 21,633.95 23,609.83 25,448.41
Total Deposits 106,048.70 123,416.26 136,738.61 141,655.02

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The products and services that we offer to our customers can be classified into five categories, namely,

(i) Deposit products;

(ii) SME products;

(iii) Retail asset products;

(iv) Corporate products; and

(v) Other products and services.

Provided below is a summary of the products and services offered by us.

Liabilities Assets Other products/

Deposit products SME products Retail products Corporate products services
 Current account  Term loans  Home loans  Working capital  Money transfers and
 Savings account  Working capital  Personal loan finance remittances
 Salary savings loans  Vehicle loans  Corporate Loans  RTGS/ NEFT
accounts for  Export Finance  Loan against  Term Loans  Utility and bill
corporate  Import Finance property  Bill Finance payments
employees  Letter of Credit  Agricultural  Export, Import  Internet banking
 Term deposit  Buyers, loan Finance  Foreign exchange
accounts for Suppliers Credit  Gold loan  Buyers,  Distribution of
domestic  Bank Guarantee Suppliers Credit insurance products
customers  Commercial Vehicle  Bank Guarantee  Lockers
 Cumulative deposit Loans  Bills discounted  Cash management
accounts  Bills discounted under domestic
 Products for NRI under domestic letters of credit
customers letters of credit

Liabilities/ Deposits

Our deposit products can broadly be categorized as current accounts, savings accounts and term deposits. Details of
deposit products currently offered by us are as below:

Current Account Products

 Classic Current Account: This account offers facilities such as unlimited remittance/withdrawal facility, multi
city payable at par cheque books, any branch banking services, ATM/debit card, internet banking and RTGS/
NEFT facility.

 Smart Current Account: This is an entry level zero balance account with no folio charges. Similar to a classic
current account, it has volume based riders on daily cash remittance.

Savings Bank Products

 Domestic Savings Bank Account: This account can be opened and operated by both individuals and eligible
corporates. We offer multi city cheque book facility, VISA ATM/ debit cum shopping cards, internet
banking and basic mobile banking facilities to all our domestic savings bank account holders. Domestic
savings bank account holders earn interest on daily float funds, presently at 4% p.a., paid half yearly. All our
saving bank customers are enabled to bank seamlessly with any branch of our Bank across the country.

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 CSB Social Support Scheme: This is a zero balance, no frills/basic savings bank deposit account (“BSBDA”)
without any minimum balance stipulations aimed at financial inclusion. Further, there are no service/
maintenance charges and the ATM/ debit card facility is also free of charge. There is an option to upgrade to
regular savings bank account, on request. In addition, we also offer a BSBD small account with diluted KYC
as stipulated by the RBI for comprehensive financial inclusion.

 CSB Student Support Scheme: This account is for students above the age of six years. It has no stipulation on
minimum balance and the debit card facility is provided free of charge.

Salary savings account for corporate employees

 CSB Suvidha, Suvidha Plus: This is a corporate employee group salary savings scheme. Under this scheme,
we offer savings accounts to salaried employees, with no stipulation on minimum balance requirements or
charges for non-maintenance of minimum balance and annual account maintenance charges. Suvidha
accounts are for employees with monthly income less than ` 5,000 and Suvidha Plus accounts are for
employees earning ` 5,000 or more. Visa ATM, debit cards are offered to all Suvidha and Suvidha Plus
customers, while a cheque book is provided (as applicable to ordinary savings accounts) to all Suvidha Plus
account holders.

Term deposit products for domestic customers

 Fixed Deposits: This is an income scheme wherein deposits are accepted for a minimum period of seven days
and up to a maximum of 10 years. Interest on such deposits is payable either on monthly or quarterly basis.

 Family Welfare Deposits: This is a reinvestment deposit scheme in which interest accrues both on the
principal and the interest on quarterly basis. Deposits are accepted for a minimum period of six months and
for a maximum of 10 years (and broken periods between six months and ten years). Interest is paid along with
the principal on maturity.

Cumulative Deposit Account

 This is a recurring deposit scheme that enables the depositor to build up a sizeable corpus in a regular/
systematic manner. Such accounts can be opened for a minimum period of six months and for a maximum
period of up to 10 years, in multiples of three months

Products for NRI customers

 NRE Savings Bank Accounts: Under this scheme deposits are held in convertible Rupees and the principal and
interest amounts are repatriable without any restrictions.This account can be opened and operated by
individuals, singly or jointly with other NRIs or jointly with close resident relatives subject to conditions.

 NRO Savings Bank Accounts: Under this scheme, deposits are held in non repatriable Rupees. However,
certain current income of NRIs such as dividend, rent, pension, interest credited to the account can be
repatriated. This account can be opened and operated by individuals singly or jointly with other NRIs or
jointly with close resident relatives. The account can be used for local payments in rupees including payment
for passage from India of the account holder or his/ her dependents.

 NRE Current Accounts: All the features of NRE Savings Bank accounts are applicable to these accounts.
However, interest is not payable for this account.

 NRO Current Account: All the features of NRO Savings Bank accounts are applicable to these accounts.
However, interest is not payable for this account.

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 NRE Fixed Deposits: This is an income scheme for NRIs wherein deposits are accepted for periods of 12
months and up to 10 years. The deposits are held in convertible Rupees and the principal and interest amounts
are repatriable without any restrictions.

 NRO Fixed Deposits: This is an income scheme for NRIs wherein deposits are accepted for periods of seven
days and up to 10 years.

 NRE Family Welfare Deposits: This is a reinvestment deposit scheme meant for NRIs. All other features are
similar to the NRE Fixed deposit described above.

 NRO Family Welfare Deposits: This is a reinvestment deposit scheme meant for NRIs. Deposits are accepted
for a minimum period of six months and for a maximum period of 10 years.

 NRE Cumulative Deposit Accounts: This is a recurring deposit scheme meant for NRIs that enables the
depositor to build up a sizeable corpus in a regular/ systematic manner. These accounts can be opened for a
minimum period of 12 months and for up to 10 years. Deposits from this scheme are held in convertible
Rupees and the principal and interest amounts are repatriable without any restrictions.

 NRO Cumulative Deposit Accounts: This is a recurring deposit scheme meant for NRIs that enables the
depositor to build up a sizeable corpus in a regular/ systematic manner. These accounts can be opened for a
minimum period of 12 months and in multiples of three months for up to 10 years.

 FCNR (B) Deposit Schemes: Under these schemes, deposits are accepted in USD, GBP, EUR, JPY, CAD,
AUD and CHF currencies. Deposits can be held as fixed deposit (FCNR-FD) or reinvestment (FCNR-FWD),
NRE Plus (FCNR (B) FD for 366 days) and for periods from 12 months to 60 months

Other deposit products

 RFC Deposit Scheme: In this scheme, accounts can be opened by a person returning to India for permanent
settlement after a stay of minimum period of one year abroad. These accounts can be opened and maintained
out of foreign exchange received as pension, conversion of assets held abroad, and can be held as current/
savings/ term deposit accounts.

The following table sets forth the details of contribution by domestic and non-resident deposits to our total deposits
as on March 31, 2012, March 31, 2013, March 31, 2014 and September 30, 2014.

(In ` million)
Particulars Total Deposits as on
March 31, 2012 March 31, 2013 March 31, 2014 September 30, 2014
NRI deposits 12,230.81 16,621.89 23,616.20 26,211.23
Domestic deposits 93,817.89 106,794.37 113,122.41 115,443.79
Total deposits 106,048.70 123,416.26 136,738.61 141,655.02

The regional distribution of our deposits as on March 31, 2012, March 31, 2013, March 31, 2014 and September 30,
2014 is as below.

(In ` million)
Region States and union territories As on March 31, As on
September 30,
2012 2013 2014 2014
Central Chhattisgarh, Madhya Pradesh, Uttar 175.85 318.89 1,042.12 611.76
Pradesh, Uttarakhand
Eastern Bihar, Jharkhand, Orissa, Sikkim, West 949.63 1,121.24 1,285.15 1,094.03
Bengal, Andaman and Nicobar Island

Northern Haryana, Himachal Pradesh, Jammu and 5,115.24 6,773.86 8,086.07 8,225.57

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 Region States and union territories As on March 31, As on
September 30,
2012 2013 2014 2014
Kashmir, Punjab, Rajasthan, Chandigarh,
Delhi
Southern Andhra Pradesh, Telengana, Karnataka, 86,842.60 100,356.83 111,677.08 116,637.72
Kerala, Tamil Nadu, Lakshadweep,
Puducherry
Western Goa, Gujarat, Maharashtra, Dadra and 12,965.38 14,845.44 14,648.19 15,085.94
Nagar Haveli, Daman and Diu
Total 106,048.70 123,416.26 136,738.61 141,655.02

SME Products

In the SME business, we cater to small and medium industries, the service sector and trading companies, where
customer borrowing needs are up to ₹250 million. Our Bank has established branches which are conveniently
located in close proximity to a large portion of our target SME customer base. Our Bank has also designated
employees for sourcing SME business and has appointed SME team leaders in every zone who support the branches.
We provide both term loan and working capital facilities such as overdrafts, cash credits, inland bill/invoice
discounting to our SME customer base. The term loan facilities meet the long term fund requirement of customers
for asset purchase, capacity up-gradation and are typically backed by the assets acquired using the facilities extended
by us and/or additional collateral security. The repayment can either be through a regular repayment option in
installments or a bullet payment, based on the customer needs. Various term loans offered by us under the SME
business are follows:

 Term Loans: These are provided to customers who need funds to acquire and enhance fixed assets.

 Working capital loans: These are given in the form of cash credit/ overdraft for purchase of raw material and
meeting working capital gap.

 Export finance: Export finance is available in the form of both pre-shipment and post shipment credit. Pre-
shipment credit is generally availed by customers against letters of credit or against firm orders from their
buyers. Packing credit is allowed in both local currency and foreign currency. Post-shipment credit is availed
in the form of discounting of bills after the shipment happens and could be both supported by letters of credit
or on open account basis.

 Import Finance: Import finance is available to importers of goods both raw materials and capital goods.

 Letter of Credit: Letter of credit facility is provided to meet trade purchases from domestic/overseas suppliers.
These are typically provided for 3-6 months depending upon the trade cycle and specific agreement between
buyers and suppliers. Longer term letter of credit facilities are provided selectively.

 Buyers/ Suppliers Credit: Our Bank arranges buyer's/ suppliers credit through overseas banks/ correspondents
to help reduce cost for importers as per RBI guidelines.

 Bank Guarantee: Our Bank provides bank guarantee facilities to our customers favouring government, quasi
government bodies and corporates to support business needs such as performance, customary bonds and bid-
bonds.

 Commercial Vehicle Loans: The commercial vehicle loans are provided for purchasing and upgrading
business related transportation of our SME customers.

 Bills discounted under domestic letter of credit: This facility is for customers who supply goods against
domestic letters of credit opened by their buyers are allowed to discount bills drawn under letters of credit
opened by banks in India.

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In addition to the above, our Bank undertakes structured financing in discussion with customers. Facilities are tailor
made to suit customer’s specific needs and adjusted based on customers’ performance vis-à-vis projects and
projections.

A sizeable share of our total lending is allocated to our SME customers. Our outstanding SME loan advances were `
41,493.58 million as on September 30, 2014, representing 43.18% of our total advances as on that date. As on
March 31, 2012, 2013 and 2014, we had outstanding SME loan advances of ` 27,394.52 million, ` 29,986.10
million, and ` 35,770.63 million, representing 35.27%, 33.41% and 40.40% of our total gross advances for the even
dates, respectively.

Retail Asset Products

Our retail banking business offers wide range of services and products to individuals including NRIs and small
business entities. Our products under our retail business can broadly be classified into (i) loans and advances, (ii)
third-party products and (iii) financial inclusion.

Loans and Advances

We have introduced various retail loan products over the years to cater to the needs of the customers and to provide
quick and easy access to our Bank. Details of the various retail loan products currently offered by our Bank are
given below:

Home Loans Personal Loan Vehicle loan Loan against Agriculture Gold Loans
property (LAP) Loans
 Housing loan  Casy Cash  CSB Vehicle  CSB  CSB Kisan  Gold loan-
for Resident  Professional Loan Property Raksha General
Indians plus  VIP car loan Encash  Casy Bank  Agriculture
 Housing loan  Medi Cash  Casy Mithra Krishi Kard Gold loan
for Non-  Personal loan to  Tax Payer’s (with interest
Resident CSB Retired Liquidity subvention
Indians employees Scheme and without
 CSB Nivas  Personal loan to interest
employees of subvention )
reputed  CSB Ezee
organizations Gold Cash
 CSB Women  Gold loan for
Support Scheme retail trade
 CSB Senior  CSB-
Personal Kanakshree
Support Scheme overdraft
 CSB Home Plus
Support
 Education loan

Housing loans

Our Bank offers housing loans to resident Indians and NRIs at a competitive interest rates and easy EMI schemes.
There are three variants of housing loans:

 Home loans for domestic customers (non-NRIs) for lending to salaried customers, self-employed
professionals and business owners for purchase of a house.
 Home loans for NRI customers for predominantly salaried NRI customers.
 CSB Nivas loan for purchase of land and further construction within three years.

Personal Loans

Our Bank has a wide range of personal loan products catering to different needs of customers:

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 Casy Cash for small retail individual customers.
 Professional Plus targets engineers, chartered accountants, company secretaries, lawyers and other
professionals.
 Medi Cash which targets doctors and other individuals in the medical profession.
 Education Loans for students.
 Women Support Scheme loans which are targeted at working women.
 CSB Senior Citizens Personal Scheme for senior citizens.
 CSB Home Plus Support is a personal loan product offered as a top up to home loan customers.

Vehicle loans

We offer two products under our vehicle loan portfolio.

 VIP Car Loan is a specially designed scheme for the high value customers where our Bank offers 100%
finance on the invoice value of the vehicle (excluding taxes, insurances, etc).
 Vehicle Loan scheme offers up to 80% financing on the road cost including invoice price, road taxes, etc to
everyone for purchase of vehicles.

Loan against Property

Our Bank has the following three variants of loans against property to suit the requirement of different customers.

 CSB Property Encash is a term loan facility given against residential or commercial property. This loan is
targeted at both salaried and self-employed customers
 Tax Payer’s Liquidity Scheme is an overdraft facility for regular tax paying customers.
 Casy Mithra is personal loan scheme for customers on the basis of a multiple of their salary/income.

Agricultural Loans

Our agriculture loan products and services primarily include pre and post-harvest financing, loans for farm
mechanization, land development and allied activities such as fisheries, dairy and poultry. We have two specialized
product i.e., CSB Kisan Raksha and Casy Bank Krishi Kard as mentioned below:

 CSB Kisan Raksha provides financial assistance to farmers for meeting their farming needs including
repaying high cost loans availed from non-institutional lenders. All individuals who undertake agriculture/
allied activities (such as diary, poultry, goat rearing etc.) are eligible to avail this loan. Typically secured
through hypothecation of crops and other farm assets, and/or mortgage of land and personal guarantees, CSB
Kisan Raksha loans are given up to a limit of 50% of the value of the security property provided, or five times
of the net annual farm income of the borrower, subject to a maximum of ` 0.5 million. Such loans also
provide free accident insurance for the principal borrower in first year of availing the loan.

 Casy Bank Krishi Kard loan is designed to meet the short term credit requirements for cultivation of crops,
post-harvest expenses, produce marketing, household consumption requirements, working capital for
maintenance of farm assets and activities allied to agriculture, such as dairy animals, inland fishery and
investment credit requirement for agriculture and allied activities such as pump sets, sprayers and dairy
animals. This loan is available to all farmers (individuals or joint borrowers), self-help groups, joint liability
groups of farmers including tenant farmers and share croppers. Typically secured through hypothecation of
crops and other agricultural implements/ assets, and/or mortgage of agricultural land or building and third
party guarantees, Casy Bank Krishi Kard loans are typically valid for five years.

Gold loans

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Gold loans constituted 29.99%, 38.31%, 32.04% and 29.54% of our total advances as on March 31, 2012, 2013,
2014 and September 30, 2014 and continue to be a mainstay for our Bank on the advances side. Our Bank has
various gold loan products in line with the needs and requirements of the customers.

 General Gold Loan is a demand loan for customers for various personal needs. The loan has a tenure of 12
months.
 CSB Ezee Gold Cash is a demand loan for customers with tenure of up to six months.
 Agriculture Gold Loan is a demand loan available for agriculture and allied activities. The tenure of the loan
is fixed on the basis of the duration of the relevant crop. This loan is available both with and without interest
subvention. These loans are eligible for priority sector lending classification.
 Gold loan for retail trade is a demand loan for retail traders classified under priority sector. The tenure of
loan is up to 12 months.
 CSB Kanakshree is an overdraft facility for traders available for tenure of up to 12 months.

The growth of loans and advances to the retail sector is a priority for our Bank. As on September 30, 2014, we had
total (gross) outstanding retail loans of ` 41,954.88 million which represented 43.66% of our total (gross)
outstanding loans and advances as on that date. The following table classifies our outstanding retail loans and
advances as on March 31, 2012, March 31, 2013, March 31, 2014 and September 30, 2014.

(In ` million)
Schemes As on March 31, 2012 As on March 31, 2013 As on March 31, 2014
As on September 30,
2014
Amount % of total Amount % of total Amount % of total Amount % of total
outstanding outstanding outstanding outstanding outstanding outstanding outstanding outstanding
Gold loan 23,296.20 67.48 34,387.48 75.43 28,365.39 70.30 28,383.63 67.65
Of which
Agriculture
Gold Loan 10,423.47 3,857.38 3,077.61 5,386.24
Home loan 2,875.78 8.33 2845.41 6.24 2974.78 7.37 3,190.38 7.60
Loan
Against
Property 564.30 1.63 486.70 1.07 697.80 1.73 1,143.40 2.73
Personal
loan 2,288.31 6.63 2,575.84 5.65 2,821.11 6.99 3,263.67 7.78
Agriculture
Loan
(Excluding
agriculture
gold loan) 838.58 2.43 803.19 1.76 309.60 0.77 821.40 1.96
Others 4,657.98 13.49 4,487.89 9.84 5,180.74 12.84 5,152.40 12.28
Total 34,521.15 100.00 45,586.51 100.00 40,349.43 100.00 41,954.88 100.00

Third Party Products

We have identified bancassurance as an important business line. We have accordingly entered into tie up with
Edelweiss Tokio Life Insurance Company Limited to market its life insurance policies and are also in the process of
finalizing an agreement with a leading general insurance company for distributing its general insurance products.

We currently have over 50 employees involved in selling these insurance products who have been authorized by the
IRDA to act as specified persons for selling insurance products. We also have tie ups with major money transfer
agents including Wall Street Finance Limited, MoneyGram Payment Systems Inc, Weizmann Forex Ltd and UAE
Exchange & Financial Services Ltd, which enhance our capability to provide international remittance services. Our
income from bancassurance was ` 26.71 million, ` 8.54 million, ` 15.37 million and ` 11.86 million for Fiscal
2012, Fiscal 2013, Fiscal 2014 and for six months ended September 30, 2014, respectively.

Financial Inclusion

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As part of our financial inclusion initiatives, we have entered into an agreement with a service provider to, inter alia,
provide services to our Bank relating to appointing of business correspondents. The service provider has appointed,
Akshaya Centers, in Kerala as banking correspondents who act as a micro units of our Bank and open “No Frill”
savings bank accounts. Further, we have set up seven financial literacy and credit counselling centres. As on
December 31, 2014, we have 49 rural branches and are in the process of strengthening financial literacy activities
through each of these branches. The activities carried out by the financial literacy and credit counselling centres and
the rural branches include conducting financial literacy camps, credit counselling, counselling/advise on education
loans, counselling on entrepreneurship/ agricultural loan and assistance in preparation of project report.

Corporate Business

In corporate banking portfolio, we focus on large-sized corporations (i.e., companies with annual turnover of over `
1,000 million) whose credit requirement is above ` 250 million. We have a wide range of loan products which
include term loans, working capital facilities, import and export financing, bill discounting, participation in
syndication financing, foreign currency loans, investment in various securities issued by corporates, non-fund based
services such as letters of credit, forward covers for hedging exposure, foreign currency conversion and guarantees.

The increase in NPA in the Fiscal 2014 was primarily attributable to impairment of few corporate loans. Therefore,
currently our Bank’s approach on the corporate business is very selective and is primarily undertaken for
deployment of surplus funds profitably. Our Bank has curtailed its participation in the consortium lending barring
selected relationships where our Bank continues to operate with close control and supervision. Our Bank is
increasingly participating in transactions led by other banks on a selective basis where such lending meets with
Bank’s risks, return criteria and are in sectors of interest. Further, some of our SME customers have grown into large
institutions over the years and have increased financial needs and we try to be relevant to such large institutions
wherever possible. Our Bank has set up a centralized corporate banking team to work with other banks that are
originating syndicated loans and corporate business branches to originate deals and to ensure close supervision,
managing of risk and the relationship thereafter.

The key commercial banking products and services offered to corporate customers include.

Products Product details

Working capital finance Over draft and cash credit limits are provided against stocks\inventory and
receivables.
Corporate Loans To facilitate margins to meet working capital margins/ one-time bulk orders.
Term Loans For investment in fixed assets, such as plant and machinery, sheds, buildings,
furniture payable in installments.
Bill Finance Purchase/ sale bill discounting
Export/ Import Finance Pre and post-shipment financing, forward covers, buyer’s credit and finance in
foreign currency.
Buyers, Suppliers Credit Arrangement of buyer's/ suppliers credit through overseas banks/ correspondents to
help reduce cost for importers as per RBI guidelines.
Bank Guarantee Bank guarantees favouring government, quasi government bodies and corporates to
support business needs such as performance, customary bonds and bid-bonds.
Bills discounted under domestic letters For customers who supply goods against domestic letters of credit opened by their
of credit buyers are allowed to discount bills drawn under letters of credit opened by banks in
India.

Our revenue from corporate advances business was ` 1,690.91 million for Fiscal 2012, ` 1,548.02 million for Fiscal
2013, ` 1,273.21 million for Fiscal 2014 and ` 652.45 million for six months ended September 30, 2014.

TREASURY OPERATIONS

Treasury operations are our interface with the financial markets. Our treasury department undertakes fund
management and maintains the statutory reserve requirements of our Bank. The treasury department invests in
sovereign and corporate debt instruments, undertakes proprietary trading in equity and fixed income securities and

141
foreign exchange, investments in certificate of deposits and mutual funds as part of the management of short-term
surplus liquidity within the framework of our Bank’s investment policy.

We have been licensed by the RBI to deal in foreign exchange (Authorised Dealer Licence) and we have set up our
international banking division (IBD) at Kochi, which conducts our foreign exchange operations. IBD is an A
category – Branch of our Bank and maintains independent foreign exchange position and Nostro accounts in all
major currencies. We undertake foreign exchange transactions for our customers through 23 B- category branches
spread across India. All B-category branches are equipped with trained staff and SWIFT terminals to facilitate
foreign exchange operations. We have drawing arrangements with 14 exchange houses for facilitating the transfer of
funds for the NRIs.

We have also set up a trade hub at Ernakulam, Kerala to provide centralized technical support, market guidance and
strategy execution and monitoring for the trade business. The trade hub aims at both product offerings and advisory
level service to the customers, assisting them with forex exposure arrangements. The trade hub also acts as the focal
point where branches can seek conceptual and procedural clarity on various aspects of foreign exchange business.
We have also set up a forex corporate desk which works closely with customers and provides them guidance to on
market related aspects, support branches in client acquisition, provides regular market updates, conducts regular
training programmes for branch officers and arranges forex meets. Further, we have also launched forex sales and
service initiative for providing the necessary marketing support to branches for improving the foreign exchange
business of our Bank.

Our turnover from foreign exchange operations through our customers in Fiscal 2012, 2013, 2014 and for the six
months ended September 30, 2014 was ` 189,793.00 million, ` 203,906.80 million, ` 285,786.00 million and `
177,206.20 million, respectively.

The following table sets forth, as on the dates indicated, the allocation of our investment portfolio (Gross).

(In ` million)
Securities As on March 31, As on September 30,
2012 2013 2014 2014*
Amount % Amount % Amount % Amount %
PSU Bonds 430.80 1.37 420.70 1.27 1,688.10 3.28 1.627.00 3.32
RIDF and Other Funds 2,219.40 7.05 1,552.70 4.70 3,802.30 7.40 3,937.50 8.04
Securities issued by
0.00 0.00 0.00 0.00 1,206.50 2.35 2,194.80 4.48
ARC'S
Share 9.10 0.03 45.90 0.14 45.90 0.09 28.30 0.06
Treasury Bills 2,146.40 6.82 245.50 0.74 2,832.80 5.51 5,919.80 12.08
Central Govt. Securities 24,937.40 79.23 28,157.70 85.21 30,381.80 59.11 30,856.10 62.99
State Govt. Securities 836.80 2.66 1,145.50 3.47 1,869.40 3.64 2,312.30 4.72
Bank Certificate of
493.30 1.57 987.00 2.99 9,059.80 17.63 1,601.50 3.27
Deposits
All Others 401.26 1.27 491.20 1.48 511.24 0.99 511.21 1.04
Total 31,474.46 100.00 33,046.20 100.00 51,397.84 100.00 48,988.51 100.00
*
Reverse repo ` 2400 million not included in the above investments.

The following table sets forth, as on the dates indicated, the category wise allocation of our investment portfolio.

(In ` million)
Security As on March 31, As on March 31, As on March 31, As on September 30,
2012 2013 2014 2014
Held to Maturity (HTM) 27,858.80 31,186.54 36,064.43 36,568.70
Available for Sale (AFS) 3,615.66 1,859.66 15,333.41 12,419.81
Held for Trading 0.00 0.00 0.00 0.00
Total 31,474.46 33,046.20 51,397.84 48,988.51
Yield 6.64 6.88 7.26 7.32
Modified Duration HFT Nil Nil Nil Nil
Modified duration HTM 4.78 5.44 5.05 5.08

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 Security As on March 31, As on March 31, As on March 31, As on September 30,
2012 2013 2014 2014
Modified duration AFS 1.49 1.14 0.91 1.37

OUR PERFORMANCE UNDER PRIORITY SECTOR LENDING TARGETS

In line with guidelines issued by the RBI, we are required to lend at least 40% of our adjusted net bank credit or
credit equivalent to off-balance sheet exposure, whichever is higher to the priority sector, including at least 18% to
the agricultural sector. Our priority sector lending includes loans to small enterprises, retailers and certain sectors
such as agriculture, education sector, and agriculture based processing sectors and housing sector. To support this,
we have 63% of our branches located in rural and semi-urban areas as on December 31, 2014 and we also have
specialized schemes for priority sector lending such as, CSB Kisan Rakha, Casy Bank Krishi Kard and gold loans
for agriculturists.

The following table presents data on our outstanding priority sector lending, including as a percentage of our
adjusted net bank credit as on March 31, 2012, 2013, 2014 and September 30, 2014.

(In ` million)
Business Balance outstanding as on
March 31, 2012 March 31, 2013 March 31,2014 September 30, 2014
Total priority sector advances 25,320.60 19,134.50 25,666.90 32,140.20
Eligible investments in RIDF etc. - - 3,364.60 3,250.40
Total priority sector attainment 25,320.60 19,134.50 29,031.50 35,390.60
Total priority sector attainment (net)
as a % of ANBC 40.18% 24.52% 31.70% 38.38%

CERTAIN KEY OPERATING PARAMETERS

Loan concentration

We have an internal credit policy on portfolio diversification. Our total financing exposure in a particular
business is evaluated in accordance with business wise growth. Our credit/credit monitoring department monitors
sector wise exposure. Major changes in the industrial segments are closely monitored and corrective actions are
initiated.

Capital Adequacy

The minimum total capital adequacy ratio currently required by the RBI under Basel II norms is 9.00% of the risk
weighted average (“RWA”). We implemented Basel II norms from Fiscal 2008 and are calculating capital
adequacy ratios on a quarterly basis as per the applicable Basel III norms along with Basel II norms since April 1,
2013.

Our capital adequacy details are below.

Particulars Capital Adequacy Ratio (CRAR) % as on

March 31, 2012 March 31, 2013 March 31, 2014 September 30, 2014
Basel II 11.14 12.19 11.25 9.87
Basel III - - 11.00 9.72

Asset Classification

Our assets are classified in accordance with the guidelines issued by the RBI. An asset is classified as non-
performing if any amount of interest or principal on a term loan is overdue on it for a period exceeding 90 days. In
respect of overdraft or cash credit, an asset is classified as non-performing if the account remains overdue for a
period of more than 90 days and in respect of bills, if the amount remains overdue for more than 90 days. Based on
the existing guidelines issued by the RBI for asset classification, details of the classification of our gross loans and

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other data in respect of NPAs as on March 31, 2012, March 31, 2013, March 31, 2014 and September 30, 2014 are
as follows:

Particulars Asset Classification

Fiscal 2012 Fiscal 2013 Fiscal 2014 September 30, 2014
Gross NPA (` in
Million) 1,829.26 2,108.69 3,335.54 5,345.77
Gross NPA % 2.35 2.35 3.77 5.56
Net NPA
(` in Million) 842.11 992.59 1,932.42 3,543.12
Net NPA % 1.10 1.12 2.22 3.76

NPA Recovery Strategy

We follow RBI’s guidelines and Board approved recovery policies for one time settlements and out of court
settlement of debts. Our recovery policy deals with treatment of impaired assets in various businesses. We also
refer cases to Lok Adalats, for settlement of impaired assets. For further details, please see the section titled
“Outstanding Litigation and Material Developments” on page 251.

In addition, we rely on the provisions of the SARFAESI Act for NPA recovery. The SARFAESI Act has
strengthened the ability of lenders to resolve NPAs by granting them greater rights to enforce the security and
recover dues from borrowers including abatement of reference to the Board for Industrial and Financial
Reconstruction and stay, if any, thereon. Banks can now accelerate recovery process through enforcement of the
SARFAESI Act. In order to avoid fresh slippages into NPAs, we actively monitor our loans through early warning
signal mechanisms, special mentioned accounts (credit labelling) systems and assess credit ratings once a year or
more frequently. In addition, we maintain internal policy guidelines concerning exposure to individual industries
and concentration of credit.

Credit Exposure

Credit exposure limits are prudential measures mandated by the RBI, aimed at improving risk management and
avoiding concentration of credit risk. Credit exposure limits are set in relation to individual industries and sectors,
single and group borrowers, unsecured borrowers, and country-wise. As per the RBI’s directives, the credit
exposure ceiling is fixed in relation to our capital funds under capital adequacy standards (Tier I and Tier II
capital).

Industry Exposure

Our Bank’s industry exposure as on March 31, 2014 and September 30, 2014 is set forth below.

(In ` million)
Industry/Sector Advances (Fund Exposure as % of Advances (Fund Exposure as % of
Based) Total Advances Based) Total Advances
As on March 31, 2014 As on September 30, 2014
All engineering 973.11 4.00 1,104.57 4.38
Automobiles 1,102.34 4.53 1,022.35 4.05
Cement 65.01 0.27 64.18 0.25
Chemicals 2,437.78 10.01 1,588.98 6.30
Coal 1.99 0.01 2.99 0.01
Construction 3,541.41 14.54 4,207.58 16.68
Food 1,707.54 7.01 2,561.60 10.16
Infrastructure 3,505.51 14.40 4,055.03 16.08
Iron and steel 160.77 0.66 161.67 0.64
Jewelleries 772.29 3.17 732.47 2.90
Leather 154.44 0.63 134.58 0.53
Mining 418.07 1.72 406.16 1.61
NBFC 744.93 3.06 742.28 2.94

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 Industry/Sector Advances (Fund Exposure as % of Advances (Fund Exposure as % of
Based) Total Advances Based) Total Advances
As on March 31, 2014 As on September 30, 2014
Oil 58.07 0.24 64.35 0.26
Other Industries 2,296.81 9.43 2,033.82 8.06
Other metals and metal
products 484.93 1.99 518.53 2.06
Paper 291.86 1.20 308.77 1.22
Petroleum 21.01 0.09 22.45 0.09
Rubber 253.85 1.04 284.79 1.13
Software 47.43 0.19 50.43 0.20
Sugar 0.05 0.00 0.05 0.00
Tea 46.36 0.19 49.14 0.19
Textiles 5,239.70 21.52 5,081.56 20.15
Tobacco and
Beverages 26.59 0.11 22.95 0.09
Total 24,351.84 100.00 25,221.27 100.00

Borrower Exposure

The details of our outstanding fund exposure to our 10 largest single borrowers as on March 31, 2014 and
September 30, 2014 are set forth below:
(In ` million)
Customer Exposure (Fund + Non Fund Exposure (Fund + Non Fund
Based) Based)
As on March 31, 2014 As on September 30, 2014
Customer 1 1,499.52 1,522.47
Customer 2 1,214.87 1,154.79
Customer 3 798.86 959.47
Customer 4 800.00 804.91
Customer 5 713.79 700.00
Customer 6 620.58 600.00
Customer 7 652.36 635.71
Customer 8 577.86 577.86
Customer 9 519.98 520.10
Customer 10 550.24 500.00
The names of the borrowers are not disclosed above in order to comply with the restrictions imposed by the RBI that requires
such information to be confidential.

Unsecured Exposure

Unsecured credit exposure is defined by the RBI as an exposure where the realizable value of the security is not
more than 10% of the outstanding exposure when the advance is made. Our policy is to limit our total unsecured
advances to a maximum of 12% of our total advances as on the previous year. Our unsecured advances as on March
31, 2014 and September 30, 2014 were ` 3,184.73 million and ` 4,126.74 million, respectively, which constituted
3.66% and 4.37% of our total advances for such period, respectively, for such periods.

Distribution Network

We have a distribution network comprising branches, ATMs, internet banking channels and a call center. We are
looking to partner with certain entities to open off-site ATMs perticualrly in Kerala. The composition of our
distribution network as on March 31, 2012, 2013, 2014 and December 31, 2014 is set out in the table below:

Distribution point As on March 31, As on March 31, As on March 31, As on December 31,
2012 2013 2014 2014
Branches 377 395 430 431
ATMs 178 208 230 232

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Branches

As on December 31, 2014, we have 431 branches of which, 55 branches are in metropolitan cities, 102 branches in
urban areas, 225 in semi-urban and 49 in rural areas. All of our branches are fully networked and connected to a
central database in Chennai on a real-time basis with a disaster recovery facility in Bangalore and a specific disaster
recovery facility for RTGS transactions in Chennai.

Non-branch delivery channel

ATMs: As on December 31, 2014, we had 232 ATMs, which includes 174 on-site and 58 off-site ATMs. Our ATMs
are part of the Visa and NFS shared payment networks which enable our Visa cardholders to access numerous
ATMs of member banks.

Internet banking: We offer internet banking services to our retail and corporate customers.

Mobile banking: We offer mobile banking services to our retail customers.

Customer Service

We are a member of Banking Codes and Standards Board of India and are actively implementing its codes, namely
Code of Bank’s Commitment to Customers and Code of Bank’s Commitment to Micro and Small Enterprises. We
have also constituted customer service committees at branch, zonal and corporate level to monitor customer
complaints, queries and their concerns relating to our Bank. We review our customer service measures at regular
intervals, the same is presented to the Board level Customer Service Committee on a quarterly basis.

We had six customer service complaints, pending at the beginning of Fiscal 2012. In the last three Fiscals we have
received 336 complaints from our customers. During this period we have managed to resolve 339 complaints
(including certain complaints from the previous Fiscals). As on March 31, 2014, seven complaints were outstanding
against our Bank.

Credit Policy and Process

The main objectives of our credit policy is to maintain the quality of our loan assets, to ensure reasonable return on
assets, to maintain an acceptable risk profile, to achieve proper sectoral and geographical risk profile and to ensure
compliance with all the regulatory norms in respect of exposure caps, pricing, income recognition and asset
classification guidelines and targeted credits.

To attain these objectives, we have a well-defined process starting from credit sourcing to monitoring of accounts
once credit is granted. Our credit process primarily includes credit sourcing, credit appraisal and assessment, credit
sanction and credit monitoring and administration. The credit sourcing is done by the respective branches with
support from specialist business teams. The credit appraisal process involves collection of detailed data, assessment
of the requirements, financial analysis, verification of credentials, rating of the applicant and the proposal, risk
analysis and mitigation, compliance with the exposure norms, know-your-customer and anti-money laundering
guidelines and other regulatory requirements. We also have a comprehensive risk rating system that serves as a
single point indicator of diverse risk factors of a borrower for taking credit decisions in a consistent manner.
Subsequent to the appraisal process, every credit proposal is submitted to the appropriate internal authorities for
sanction.

For improving the post lending monitoring of advances, with specific focus on follow up with the parties for timely
remittance of installments/interest and operations in working capital limit, a dedicated monitoring team has been set
up. The monitoring team supplements the efforts of the branches and zones in monitoring the accounts.

Anti-Money Laundering (“AML”)

All our transactions are monitored in accordance with the standard guidelines prescribed for the banking industry.
Reports such as cash transaction reports, suspicious transaction reports, non-profit organization's transactions, and

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counterfeit currency reports are regularly filed with the Financial Intelligence Unit of the GoI. We are in the process
of upgrading/procuring new AML software to strengthen our AML control.

Risk Management Framework

We adopted the Basel II framework as on March 31, 2008, which shapes our risk management policies. Our risk
management policy is based on an analysis of key areas such as market risk, credit risk, operational risk, liquidity
risk and interest risk. Our risk management system comprises policies, procedures, organizational structures and
control systems for the identification, measurement, monitoring and control of various risks through our Risk
Management Committee, under the overall supervision of our Board.

We have also set up ALCO to oversee asset liability management functions. The ALCO also recommends pricing of
deposits and advances and prepares forecasts showing the effect of various possible changes in market conditions
and recommends appropriate action. The ALCO is further responsible for ensuring that we have adequate liquidity
and that our funding mix is appropriate so as to avoid maturity mismatches and to prevent price and reinvestment
rate risk in case of a maturity gap. The ALCO regularly monitors and reviews the trend of liquidity ratios, such as
liquid assets to short term liabilities, and other liquidity risk parameters.

We have set up a Credit Risk Management Committee (“CRMC”) with the objective of identifying credit risk,
measurement of the same through credit rating, scientific risk pricing, monitoring credit risk, controlling credit risk
and credit risk mitigation. The CRMC analyzes, manages and controls credit risk on a bank-wide basis. It formulates
norms on rating standards and bench marks, prudential limits on large credit exposures, asset concentrations,
standards on collateral securities, portfolio management, loan review mechanism, risk concentrations, risk
monitoring and evaluation, pricing of loans and regulatory and legal compliance

With the principal objective of mitigating the operational risk within our Bank, we have set up an Operational Risk
Management Committee (“ORMC”). Its principal objective is the mitigation of operational risk within the
institution by creation and maintenance of an explicit operational risk management process. Key roles of ORMC are
to review the risk profile, understand future changes and threats, and decide the areas of priority and related
mitigation strategy, reviewing policies and suitably amending the same based on market practices and regulators
guidelines, monitoring and assessment of operational risk and initiating of corrective action as and when required.
ORMC ensures that adequate resources are being assigned to mitigate risks, review and approve the development
and implementation of operational risk methodologies and tools, including assessment, reporting, capital and loss
events and analyze frauds, potential losses, non-compliance, breaches, determine root cause and recommend
corrective measures to prevent recurrences.

Technology

All our branches are networked through Core Banking thereby facilitating any branch banking. We also offer
facilities such as RTGS, NEFT, SWIFT, NECS and ECS. We offer internet banking service to our customers and are
in the process of upgrading our phone banking and mobile banking facilities. We continue to upgrade our
technological capabilities to increase efficiency, reduce costs, increase convenience for our customers and make our
offerings competitive.

Competition

We face strong competition in all our principal lines of business. Our primary competitors are public sector banks,
other private sector banks including South Indian Bank Limited, Federal Bank Limited, Dhanlakshmi Bank Limited
and State Bank of Travancore. In the gold loan business, we also face competition from non-banking financial
institutions such as Muthoot Finance Limited and Manappuram Finance Limited. We also face competition from
foreign banks with operations in India. We seek to compete with these banks through value added services, faster
customer service response, quality of service, a growing inter-connected branch network and delivery capabilities
based on enhanced technology.

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Insurance

We believe that we maintain adequate insurance coverage for our business and other assets. We currently have
insurance coverage for our head office, branches and other offices. We have a special contingency policy which
covers properties that are lost or damaged by contingencies. We also have standard fire and special perils policy and
lift insurance policy for our head office. Additionally, we have standard fire and special perils policy, public liability
(non-industrial risks) insurance policy, banker’s indemnity policy and burglary insurance policy which provide
coverage to all our branches and offices across the country. Pursuant to these insurance policies, our automation,
furniture and fixtures, electronic equipment, cash in premises, cash in transit, other valuables and documents are
insured against any burglary, theft, fire, perils, terrorism, strike riots and civil commotion. Our bank also has an all
risk policy, for our office inventories, further, we have an insurance cover for director’s and officers liability.

Intellectual Property Rights

The “ ” logo appearing on the cover page of this DRHP, is a trademark owned by our Bank and
registered in our name. In addition, we also own our ATM/ debit card services logo and registered in our name. See
the section titled “Government and Other Approvals – Intellectual Property” on page 342.

Employees

As on February 28, 2015, we had 3,036 employees, of whom 733 employees were professionals in business
management, accountancy, engineering, law, computer science or economics. We believe that we have good
relationship with our employees. As of December 31, 2014, our 1,559 officers (Grade I to III), 1,097 clerks, 129
sub-staffs and 48 part time sweepers were members of trade unions.

Property

We own our registered and corporate office situated at Thrissur. Out of our 431 branches, 13 branches are located on
premises that we own and the remaining 418 branches are at premises taken on lease. As on December 31, 2014 we
have 232 ATMs. All our 58 off-site ATMs are located on premises which we lease. See the section titled “Risk
Factors” on page 13.

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 REGULATIONS AND POLICIES

The following is an overview of certain sector-specific Indian laws and regulations which are relevant to our Bank’s
business. Taxation statutes such as the Income Tax Act, labour laws such as Contract Labour (Regulation and
Abolition) Act, 1970 and other miscellaneous regulations and statutes such as the Trade Marks Act, 1999, apply to
us as they do to any other Indian company.

The description of laws and regulations set out below is not exhaustive, and is only intended to provide general
information to investors and is neither designed nor intended to be a substitute for professional legal advice. The
statements below are based on the current provisions of Indian law, and the judicial and administrative
interpretations thereof, which are subject to change or modification by subsequent legislative, regulatory,
administrative or judicial decisions.

The main legislation governing commercial banks in India is the Banking Regulation Act, 1949. Other important
laws include the Reserve Bank of India Act, 1934 the Negotiable Instruments Act, 1881 and the Banker's Books
Evidence Act, 1891. Additionally, the RBI, from time to time, issues guidelines to be followed by banks. Banking
companies are also subject to the purview of the Companies Act, 2013, to the extent applicable, and if such
companies are listed on a stock exchange in India then various regulations of the SEBI would additionally apply to
such companies, including the Listing Agreements.

Banking Regulation Act, 1949

Commercial banks in India are required to obtain a license from the RBI to carry on banking business in India. Such
license is granted to the bank subject to compliance with certain conditions some of which include: (i) that the bank
has the ability to pay its present and future depositors in full as their claims accrue; (ii) that the affairs of the bank
will not be or are not likely to be conducted in a manner detrimental to the interests of present or future depositors;
(iii) that the bank has adequate capital structure and earnings prospects; and (iv) that public interest will be served if
such license is granted to the bank. The RBI has the power to cancel the license if a bank fails to meet the conditions
or if the bank ceases to carry on banking operations in India. Additionally, the RBI has issued various reporting and
record-keeping requirements for such commercial banks. The appointment of the auditors of the banks is subject to
the approval of the RBI. The RBI can direct a special audit in the public interest, or in the interest of the banking
company, or in the interest of its depositors.

RBI has issued guidelines for Commercial banks on several matters including recognition of income, classification
of assets, valuation of investments, maintenance of capital adequacy and provisioning for impaired assets. RBI has
set up a Board for Financial Supervision, under the chairmanship of the Governor of RBI.

It also sets out the provisions in relation to the loan granting activities of a banking company. The Banking
Regulation Act specifies the business activities in which a bank may engage. Banks are prohibited from engaging in
business activities other than the specified activities. No shareholder in a bank can exercise voting rights on poll in
excess of 10% of total voting rights of all the shareholders of the bank. However, the RBI may increase this ceiling
to 26% in a phased manner. Pursuant to amendments to the Banking Regulation Act in January 2013, private sector
banks are permitted to issue perpetual, redeemable or ir-redeemable preference shares in addition to ordinary equity
shares.

Further, the Banking Regulation Act, as amended, requires any person to seek prior approval of the RBI, to acquire
or agree to acquire, shares or voting rights of a bank directly or indirectly, by himself or with persons acting in
concert, wherein such acquisition (taken together with shares or voting rights held by him or his relative or associate
enterprise or persons acting in concert with him) results in aggregate shareholding of such person to be 5% or more
of the paid up capital of a bank or entitles him to exercise 5% or more of the voting rights in a bank. Further, the
RBI may, by passing an order, restrict any person holding more than 5% of the total voting rights of all the
shareholders of a banking company from exercising voting rights in excess of 5% of all the shareholders of the
banking company, if such person is deemed to be not fit and proper by the RBI.

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Further, the RBI requires the banks to create a reserve fund to which it must transfer not less than 25% of the net
profit before appropriations. Banks are required to take prior approval from the Reserve Bank before any
appropriation is made from the statutory reserve or any other reserves.

Certain amendments also permit the RBI to establish a ‘Depositor Education and Awareness Fund’, which will take
over the bank’s deposit accounts that have not been claimed or operated for a period of 10 years or more.

The amendments also confer power on the RBI (in consultation with the central government) to supersede the board
of directors of a banking company for a period not exceeding a total period of 12 months, in public interest or for
preventing the affairs of the bank from being conducted in a manner detrimental to the interest of the depositors or
any banking company or for securing the proper management of any banking company.

The RBI may impose penalties on banks and its employees in case of infringement of regulations under the Banking
Regulation Act. The penalty may be a fixed amount or may be related to the amount involved in the contravention.
The penalty may also include imprisonment. Banks are also required to disclose the penalty in their annual report.

Regulatory reporting and examination procedures

The RBI is empowered under the Banking Regulation Act to inspect a bank. The RBI monitors prudential
parameters at regular intervals. To this end and to enable off-site monitoring and surveillance by the RBI, banks are
required to report to the RBI on various aspects. The RBI conducts periodical on-site inspections on matters relating
to the bank's portfolio, risk management systems, internal controls, credit allocation and regulatory compliance, at
regular intervals. Further, the RBI also conducts on-site supervision of selected branches with respect to their
general operations and foreign exchange related transactions.

Maintenance of records

The Banking Regulation Act specifically requires banks to maintain books and records in a particular manner.
Further the Companies Act, 2013, mandates filing of specific record with the Registrar of Companies on a periodic
basis. The provisions for production of documents and availability of records for inspection by shareholders as
stipulated under the Companies Act, 2013 and the rules thereunder would apply to our Bank as in the case of any
company. The master circular on “Know Your Customer (KYC) norms/ Anti-Money Laundering (AML) Standards/
Combating of Financing of Terrorism (CFT)/ Obligation of banks under PMLA, 2002” issued by the RBI on July 1,
2014 also provides for transactional and identification records to be maintained for a minimum period of five years
from date of transaction and ten years from the cessation of relationship with the client respectively.

Regulations relating to the opening of branches

As per the “Master Circular on Branch Authorization” dated July 1, 2014 banks may open branches in Tier 1 to Tier
6 centres without permission from the RBI subject to certain conditions mentioned in the circular. Further, prior
approval from RBI is not required to shift a branch to any location within the city, town or village. Permission of the
RBI is not required for installation of on-site ATMs. Furthermore, since June 2009 the RBI has permitted
installation of off-site ATMs at centres identified by banks, without the need for permission from the RBI in each
case, provided certain stipulated conditions are met. Further, private sector banks are required to ensure that at least
25% of all the branches opened in a year are in unbanked rural centres.

Capital adequacy requirements

Banks are subject to capital adequacy requirements of the RBI which are based on the guidelines of the Basel
Committee on Banking Regulations and Supervisory Practices. Based on this practice, RBI introduced a risk asset
ratio system for banks in India as a capital adequacy measure. Under this system, the balance sheet assets, non-
funded items and other off-balance sheet exposures are assigned prescribed risk weights and banks have to maintain
unimpaired minimum capital funds equivalent to the prescribed ratio on the aggregate of the risk weighted assets
and other exposures on an on-going basis. Under the “Master Circular on Prudential Guidelines on Capital
Adequacy and Market Discipline- New Capital Adequacy Framework” dated July 1, 2014 , requires banks to
maintain unimpaired minimum capital funds equivalent to the prescribed Capital to Risk weighted Assets Ratio a

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CRAR of 9% on the aggregate of the risk weighted assets and other exposures on an on-going basis and also a Tier 1
CRAR of 6% and 7% as per Base II and III respectively.

The total capital of a banking company is classified into Tier I and Tier II capital. Tier I capital, i.e., the core capital,
provides the most permanent and readily available support against unexpected losses. It comprises paid-up capital
and reserves consisting of any statutory reserves, free reserves and capital reserve representing surplus arising out of
sale proceeds of assets as reduced by Equity investments in subsidiaries, intangible assets, and losses in the current
period and those brought forward from the previous period. A bank’s deferred tax asset is to be treated as an
intangible asset and deducted from its Tier I capital.

Tier II capital takes on characteristics similar to equity and undisclosed reserves, and comprises of the undisclosed
reserves and irredeemable cumulative perpetual fully paid-up preference shares, revaluation reserves (at a discount
of 55.0%), general provisions and loss reserves (allowed up to a maximum of 1.25% of risk weighted assets),
investment fluctuation reserve, hybrid debt capital instruments (which combine certain features of both Equity and
debt securities) and subordinated debt (excluding such debt with initial maturity of less than 5 years or remaining
maturity of less than one year). Any subordinated debt is subject to progressive discounts each year for inclusion in
Tier II capital and total subordinated debt considered as Tier II capital cannot exceed 50.0% of Tier I capital. Tier II
capital cannot exceed Tier I capital.

Banks are required to compute the Capital Adequacy ratios under Basel II and Basel III. The Basel II Framework
has three Pillars. The Pillar 1 is the minimum capital requirements while the Pillar 2 and Pillar 3 relate to the
supervisory review process (SRP) and market discipline, respectively. The Pillar 2 of the framework makes the
Basel II much more comprehensive in its coverage of the universe of various risks to which the banks are exposed
vis-à-vis the Basel I Framework of 1988, which addressed only the credit risk and market risk. While the guidelines
on Pillar 1 and Pillar 3 were issued by the Reserve Bank in April 2007, the guidelines regarding the Pillar 2,
comprising the SRP and ICAAP, were issued in March, 2008. While the basic elements of Basel II framework have
been put in place, the banks and the supervisors need to build in capabilities for adoption of advanced approaches
under Basel II.

The RBI Basel III guidelines were introduced in May 2012 and become effective from April 1, 2013 in a phased
manner. In March 2013, the RBI deferred the implementation of credit valuation adjustment risk capital charges to
January 1, 2014 due to certain issues related to introduction of mandatory forex forward guaranteed settlement
through a central counterparty. On December 31, 2013, RBI further extended the abovementioned implementation
timeline to April 1, 2014. Basel III capital regulations will be fully implemented by March 31, 2019.

Transitional Arrangements-Scheduled Commercial Banks

(% of RWAs)
Minimum capital ratios 1-Apr-13 31-Mar-14 31-Mar-15 31-Mar-16 31-Mar-17 31-Mar-18 31-Mar-19
Minimum Common Equity Tier 1 (CET1) 4.5 5 5.5 5.5 5.5 5.5 5.5
Capital conservation buffer (CCB) - - - 0.625 1.25 1.875 2.5
Minimum CET1+ CCB 4.5 5 5.5 6.125 6.75 7.375 8
Minimum Tier 1 capital 6 6.5 7 7 7 7 7
Minimum Total Capital* 9 9 9 9 9 9 9
Minimum Total Capital +CCB 9 9 9 9.625 10.25 10.875 11.5
Phase-in of all deductions from CET1 (in %) # 20 40 60 80 100 100 100
* The difference between the minimum total capital requirement of 9% and the Tier 1 requirement can be met with Tier 2 and
higher forms of capital;
# The same transition approach will apply to deductions from Additional Tier 1 and Tier 2 capital.

Liquidity coverage ratio

The Basel III Framework on Liquidity Standards introduced two liquidity ratios i.e. Liquidity Coverage Ratio (LCR)
and Net Stable Funding Ratio (NSFR) as well as liquidity risk monitoring tools. In this regard, the RBI issued draft
guidelines in November 2012, which provided enhanced guidance on liquidity, risk governance, measurement,
monitoring and reporting to the RBI on liquidity positions. Further, RBI vide Circular DBOD.BP.BC.No.120 /

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21.04.098/2013-14 dated June 9, 2014 stipulated the LCR requirement for banks which are made effective from
January 1, 2015. The time-line provided by RBI to banks is as below:

01.01.2015 01.01.2016 01.01.2017 01.01.2018 01.01.2019

Minimum LCR 60% 70% 80% 90% 100%

Prudential norms on income recognition, asset classification and provisioning pertaining to advances
(“Prudential Norms”)

In April 1992, RBI issued prudential norms on income recognition, asset classification, provisioning standards and
valuation of investments applicable to banks, applicable from the financial year 1992-93, which are revised from
time to time.

The RBI, pursuant to its “Master Circular on Prudential Norms on Income Recognition, Asset Classification and
Provisioning Pertaining to Advances” (“Prudential Norms”) issued on July 1, 2014, provides the basis for treating
various credit facilities as non-performing and the major guidelines are set forth below
NPA

A non-performing asset (NPA) is a loan or an advance where;

i. Interest and/ or instalment of principal remain overdue for a period of more than 90 days in respect of a
term loan,
ii. the account remains ‘out of order’ in respect of an Overdraft/Cash Credit (OD/CC),
iii. the bill remains overdue for a period of more than 90 days in the case of bills purchased and discounted,
iv. the instalment of principal or interest thereon remains overdue for two crop seasons for short duration
crops,
v. the instalment of principal or interest thereon remains overdue for one crop season for long duration crops,
vi. The amount of liquidity facility remains outstanding for more than 90 days, in respect of a securitisation
transaction undertaken in terms of guidelines on securitisation dated February 1, 2006.
vii. in respect of derivative transactions, the overdue receivables representing positive mark-to-market value of
a derivative contract, if these remain unpaid for a period of 90 days from the specified due date for
payment.

Once the account has been classified as a non-performing asset, the unrealized interest and other income already
debited to the account is derecognized and further interest is not recognized or credited to the income account unless
collected.

Out-of-Order

An account should be treated as 'out of order' if the outstanding balance remains continuously in excess of the
sanctioned limit/drawing power. In cases where the outstanding balance in the principal operating account is less
than the sanctioned limit/drawing power, but there are no credits continuously for 90 days as on the date of Balance
Sheet or credits are not enough to cover the interest debited during the same period, these accounts should be treated
as 'out of order'.

Asset Classification

The aforesaid circular, classifies NPAs into (i) sub-standard assets; (ii) doubtful assets; and (iii) loss assets.

1. Substandard Assets:

With effect from March 31, 2005, a substandard asset would be one, which has remained NPA for a period
less than or equal to 12 months. Such an asset will have well defined credit weaknesses that jeopardise the
liquidation of the debt and are characterised by the distinct possibility that the banks will sustain some loss,
if deficiencies are not corrected

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2. Doubtful Assets:

With effect from March 31, 2005, an asset would be classified as doubtful if it has remained in the
substandard category for a period of 12 months. A loan classified as doubtful has all the weaknesses
inherent in assets that were classified as substandard, with the added characteristic that the weaknesses
make collection or liquidation in full, on the basis of currently known facts, conditions and values, highly
questionable and improbable.

3. Loss Assets:

A loss asset is one where loss has been identified by the bank or internal or external auditors or the RBI
inspection but the amount has not been written off wholly. In other words, such an asset is considered
uncollectible and of such little value that its continuance as a bankable asset is not warranted although there
may be some salvage or recovery value.

There are separate guidelines for projects under implementation, which are based on the achievement of financial
closure and the date of approval of the project financing.

For certain category of advances, banks were permitted to continue the standard asset classification status on
successful implementation of restructuring package. This regulatory dispensation will not be available from April 1,
2015 which means that with effect from April 1, 2015, a standard account on restructuring, for reasons other than
change in Date of Commencement of Commercial Operations (DCCO), would be immediately classified as sub-
standard on restructuring.

Provisioning and Write offs:

Provisions are based on guidelines specific to the classification of the assets. The following guidelines apply to the
various asset classifications.

Standard Assets:

The provisioning requirements for all types of standard assets is to be done as below:

a. direct advances to agricultural and Small and Micro Enterprises (SMEs) sectors at 0.25 per cent;
b. advances to Commercial Real Estate (CRE) Sector at 1.00 per cent;
c. advances to Commercial Real Estate – Residential Housing Sector (CRE - RH) at 0.75 per cent
d. housing loans extended at teaser rates: the standard asset provisioning on the outstanding amount of such
loans has been increased from 0.40 per cent to 2.00 per cent in view of the higher risk associated with them.
The provisioning on these assets would revert to 0.40 per cent after 1 year from the date on which the rates
are reset at higher rates if the accounts remain ‘standard’
e. the RBI revised the “Prudential Guidelines on Restructuring of Advances by Banks and Financial
Institutions” on May 30, 2013. Pursuant to the revised guidelines the provisioning requirement has been
increased to 5% in respect of new restructured standard accounts (flow) with effect from June 1, 2013 and
in a phased manner for the stock of restructured standard accounts as of March 31, 2013 as follows:
i) 3.50 per cent - with effect from March 31, 2014 (spread over the four quarters of 2013-14)
ii) 4.25 per cent - with effect from March 31, 2015 (spread over the four quarters of 2014-15)
iii) 5.00 per cent - - with effect from March 31, 2016 (spread over the four quarters of 2015-16);
f. All other loans and advances not included above at 0.40 per cent.

Substandard asset

A general provision of 15 percent on total outstanding should be made without making any allowance for ECGC
guarantee cover and securities available. The ‘unsecured exposures’ which are identified as ‘substandard’ would
attract additional provision of 10 per cent, i.e., a total of 25 per cent on the outstanding balance.

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Doubtful asset

a) 100 percent of the extent to which the advance is not covered by the realisable value of the security to
which the bank has a valid recourse and the realisable value is estimated on a realistic basis.
b) In regard to the secured portion, provision may be made on the following basis, at the rates ranging from 25
percent to 100 percent of the secured portion depending upon the period for which the asset has remained
doubtful:

Period for which the advance has remained in ‘doubtful’ category Provision requirement (%)
Up to one year 25
One to three years 40
More than three years 100

Loss Assets:

Loss assets are to be written off. If loss assets are permitted to remain in the books for any reason, 100 percent of the
outstanding is to be provided for.

Accelerated provisioning

In cases where banks fail to report SMA status of the accounts to CRILC or resort to methods with the intent to
conceal the actual status of the accounts or evergreen the account, banks are subjected to accelerated provisioning
for these accounts and/or other supervisory actions as deemed appropriate by RBI.

Corporate debt restructuring mechanism (“CDR system”)

The institutional mechanism for restructuring has been set up through establishment of the CDR system in 2001. It is
a joint forum of all banks and financial institutions and operates as a non-judicial body. The CDR system operates
on the principle of super-majority amongst the participating banks and financial institutions for a particular advance.
The Prudential Norms as mentioned above equally apply to the accounts restructured under the CDR system.

Law relating to Recovery of NPAs

The SARFAESI Act provides for sale of financial assets by banks and financial institutions to asset reconstruction
companies. The Prudential Norms issued by the RBI describe the process to be followed for sale of financial assets
to asset reconstruction companies. The banks may not sell financial assets at a contingent price with an agreement to
bear a part of the shortfall on ultimate realisation. However, banks may sell specific financial assets with an
agreement to share in any surplus realised by the asset reconstruction company in the future. Consideration for the
sale may be in the form of cash, bonds or debentures or security receipts or pass-through-certificates issued by the
asset reconstruction company or trusts set up by it to acquire the financial assets.

Pursuant to the amendment of the SARFAESI Act in January 2013, means for recovery of assets available to banks
and financial institutions have been strengthened. Further, banks and financial institutions have been empowered to
accept immovable property in full or partial satisfaction of the bank’s claim against the defaulting borrower at times
when they cannot find a buyer for the securities. The amendment also enables banks and financial institutions to
enter into a settlement or compromise with the borrower and empowers DRTs to pass an order acknowledging any
such settlement or compromise.

Sale of Financial assets

RBI has issued a master circular detailing guidelines for sale of financial assets to SC/RC. It broadly covers the
assets which can be sold, procedure to be followed for sale, valuation norms and disclosure requirements.

Financial assets which can be sold:

A financial asset may be sold to the SC/RC by any bank where the asset is:

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i) An NPA, including a non-performing bond/ debenture.
ii) Standard Asset where:
(a) the asset is under consortium/ multiple banking arrangements,
(b) at least 75% by value of the asset is classified as nonperforming asset in the books of other banks/FIs,
and
(c) at least 75% (by value) of the banks / FIs who are under the consortium / multiple banking
arrangements agree to the sale of the asset to SC/RC, and
iii) An asset reported as SMA-2 by the bank / FI to CRILC in terms of DBOD.BP.BC.No.98/21.04.132/2013-14
February 26, 2014.

Procedure to be followed for sale of assets:

The guidelines provide for sale of financial assets on with recourse/without recourse basis in accordance with a
policy approved by the Board. Banks should ensure that subsequent to sale of the financial assets to SC/RC, they do
not assume any operational, legal or any other type of risks relating to the financial assets sold.

Banks may receive cash or bonds or debentures as sale consideration for the financial assets sold to SC/RC. Bonds/
debentures received by banks as sale consideration towards sale of financial assets to SC/RC will be classified as
investments in the books of banks.

Banks may also invest in security receipts, pass-through certificates (PTC), or other bonds/ debentures issued by
SC/RC. These securities will also be classified as investments in the books of banks. In cases of specific financial
assets, where it is considered necessary, banks may enter into agreement with SC/RC to share, in an agreed
proportion, any surplus realised by SC/RC on the eventual realisation of the concerned asset. No credit for the
expected profit will be taken by banks until the profit materializes on actual sale.

Valuation norms:

When a bank sells its financial assets to SC/ RC, on transfer the same will be removed from its books. If the sale is
at a price below the NBV, the shortfall should be debited to P&L account. Banks can also use countercyclical
provisions for meeting such shortfall. For Assets sold on or after 26.02.2014 up to 31.03.2015, Banks can spread the
shortfall over a period of two years.

For Assets sold before 26.02.2014, excess provision on account of sale should not be reversed but utilised to meet
the shortfall/loss on sale. For Assets sold on or after 26.02.2014, Banks can reverse the excess provision on sale to
P&L account. Reversal of excess provision will be limited to the extent to which cash received exceeds the NBV of
the asset.

The security receipts/PTCs shall be recognized in the books at the lower of redemption value of SR/PTC and the
NBV of the asset. The securities (bonds/debentures) offered by SC/RC should satisfy the conditions as laid down in
the circular with regard to term, rate of interest, charge on assets, prepayment, redemption and transfer to any other
party.

All instruments received by banks/FIs from SC/RC as sale consideration for financial assets sold to them and also
other instruments issued by SC/ RC in which banks/ FIs invest will be in the nature of non SLR securities.
Accordingly, the valuation, classification and other norms applicable to investment in non-SLR instruments
prescribed by RBI from time to time would be applicable to bank’s/ FI’s investment in debentures/ bonds/ security
receipts/PTCs issued by SC/ RC. However, if any of the above instruments issued by SC/RC is limited to the actual
realisation of the financial assets assigned to the instruments in the concerned scheme the bank/ FI shall reckon the
Net Asset Value (NAV), obtained from SC/RC from time to time, for valuation of such investments.

Exposure norms:

In view of the extra ordinary nature of event, banks/ FIs will be allowed, in the initial years, a relaxation on the
exposure ceiling on a case-to-case basis.

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In addition to the above, the circular also provides Guidelines on purchase/ sale of Non - Performing Financial
Assets (other than to SC/RC).

RDDBFI Act, 1993

The RDDBFI Act was enacted for adjudication of disputes pertaining to debts due to banks and financial institutions
exceeding ` 10 million. The RDDBFI Act provides for the constitution of debt recovery tribunals, before which
banks and financial institutions may file applications for recovery of debts, and such debt recovery tribunals may
pass orders for directions including recovery by the bank or financial institution of such dues as may be deemed fit
along with a recovery certificate to such effect from the presiding officer of the respective debt recovery tribunal,
directions for attachment of the properties secured towards the dues to the bank or financial institution, injunctive
orders restraining the debtors from alienating, transferring or disposing of such secured properties, appointment of
receivers and/or local commissioners with respect to such secured properties and distribution of proceeds from sale
of such secured properties towards dues payable to the applicant banks and financial institutions. Pursuant to the
recovery certificate being issued, the recovery officer of the respective debt recovery tribunal shall effectuate the
final orders of the debt recovery tribunal in the application. Unless such final orders of the debt recovery tribunal
have been passed with the consent of the parties to an application, an appeal may be filed against such final orders of
the debt recovery tribunal before the debt recovery appellate tribunal, which is the appellate authority constituted
under the RDDBFI Act. Upon enactment of the RDDBFI Act, all original suits filed before various courts and
authorities in India were transferred before the debt recovery tribunals in the same jurisdiction for adjudication and
disposal.”

Regulations relating to Making Loans

The provisions of the Banking Regulation Act govern the making of loans by banks in India. In addition, the RBI
also issues directions in relation to the loan activities of banks. Some of the major requirements that banks are to
observe are as follows:

The RBI has prescribed norms for banks’ lending to non-bank financial companies and the financing of public sector
disinvestment.

RBI introduced the ‘Base Rate’ in place of the ‘Benchmark Prime Lending Rate’ with effect from July 1, 2010. For
loans sanctioned up to June 30, 2010, BPLR would be applicable. However, for those loans sanctioned up to June
30, 2010 which comes up for renewal from July 1, 2010 onwards, Base Rate would be applicable.

With a view to providing banks greater operational flexibility, RBI has allowed banks to review the Base Rate
methodology after three years from date of its finalization instead of the current periodicity of five years.
Accordingly, banks may change their Base Rate methodology after completion of prescribed period with the
approval of their board of directors/ ALCO. Banks will, however, not be allowed to change their methodology
during the review cycle.

Section 21A of the Banking Regulation Act provides that the rate of interest charged by a bank shall not be reopened
by any court on the ground that the rate of interest charged by a bank is excessive. The Banking Regulation Act
provides for protection to banks for interest rates charged by them. Section 20 of the Banking Regulation Act
provides that banks shall not grant loans on the security of their own shares. Further, banks cannot grant loans or
advances to or on behalf of their directors.
Directed Lending

Priority sector lending

The RBI circular on “Priority Sector Lending- Targets and Classification” dated July 1, 2014 along with RBI
circulars dated July 24, 2013, August 14, 2013, November 25, 2013, January 31, 2014 and March 12, 2014 set out
the broad policy in relation to priority sector lending. In accordance with this circular, the priority sectors for all
scheduled banks are (i) agriculture; (ii) MSE; (iii) education; (iv) retail trade; (v) micro credit and (vi) housing.
While export credit is no longer a separate category under this circular, export credit for eligible activities under

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agriculture and MSE will be reckoned for priority sector lending under respective categories. Under the RBI
guidelines, the priority sector lending targets are linked to ANBC (net bank credit plus investments made by banks
in non-statutory liquidity bonds included in the Held To Maturity category and not taking into account the
recapitalisation bonds floated by the Government) or credit equivalent amount of off-balance sheet exposure,
whichever is higher, as on March 31 of the previous year. Currently, the total priority sector lending target for
domestic banks is 40% of ANBC or credit equivalent amount of off-balance sheet exposure, whichever is higher, ,
with agricultural advances required to be 18.0% of net bank credit and advances to weaker sections required to be
10.0% of net bank credit.

Export Credit

RBI also requires commercial banks to make loans to exporters at concessional rates of interest. This enables
exporters to have access to an internationally competitive financing option. Export credit is not a separate category
of Priority Sector Lending. Export credit to eligible activities under agriculture and MSE will be reckoned for
priority sector lending under respective categories.

Exposure norms

Credit Exposure: Credit exposure comprises the following elements:

(a) All types of funded and non-funded credit limits.

(b) Facilities extended by way of equipment leasing, hire purchase finance and factoring services

As a prudential measure aimed at better risk management and avoidance of concentration of credit risk, the Reserve
Bank of India has advised the banks to fix limits on their exposure to specific industry or sectors and has prescribed
regulatory limit’s on bank’s exposure to individual (15% of capital funds) and group borrowers (40% of capital
funds) in India. Credit exposure to a single borrower may exceed the exposure norm of 15 percent of the bank's
capital funds by an additional 5 percent (i.e. up to 20 percent) provided the additional credit exposure is on account
of extension of credit to infrastructure projects. However, Bank can consider enhancing the exposure to a borrower
(single as well as group) up to a further 5 percent of capital funds subject to Board’s approval and borrower’s
consent for appropriate disclosures in Annual Reports.

Relaxations are permitted in exceptional circumstances and if lending to the infrastructure sector. The total exposure
to a single NBFC has been limited to 10% of the bank’s capital funds while exposure to non-banking asset finance
company has been restricted to 15% of the bank’s capital funds. The limit may be increased to 15% and 20%,
respectively, provided that the excess exposure is on account of funds lent by the NBFC to the infrastructure sector.

The exposure limits will also be applicable to lending under consortium arrangements.

The bank should make appropriate disclosures in the ‘Notes on account’ to the annual financial statements in respect
of the exposures where the bank had exceeded the prudential exposure limits during the year.

The aggregate exposure of a bank to the capital markets in all forms (both fund based and non-fund based) should
not exceed 40% of its net worth, as on March 31 of the previous year.

In addition, banks are also required to observe certain statutory and regulatory exposure limits in respect of advances
against / investments in shares, convertible debentures /bonds, units of equity-oriented mutual funds and all
exposures to Venture Capital Funds (VCFs).

Country Risk Provisioning

Banks are required to make provision for country risk in respect of a country where its net funded exposure is one
per cent or more of its total assets.

Banks Invesment Classification and Valuation Norms

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The salient features of the RBI’s guidelines on investment classification and valuation are given below:

(i). Classification:
The entire investment portfolio is required to be classified under three categories: (a) Held to Maturity; (b)
Held for Trading; and (c) Available for Sale. Banks should decide the category of investment at the time of
acquisition. All Investments are accounted for on settlement dates. However, for disclosure in the Balance
Sheet, investments are classified under six groups – Govt. Securities, Other Approved Securities, Shares,
Debentures and Bonds, Subsidiaries/Joint Venture and Others.

(ii). Basis of Classification:

Securities that are held principally for resale within 90 days from the date of purchase are classified under the
HFT category. Investments that the bank intends to hold till maturity are classified under the HTM category.
Securities which are not classified in the above categories are classified under the AFS category. RBI has
decided to bring down the ceiling on SLR securities under the HTM category from 24 per cent of NDTL to
22 per cent (w.e.f 19.09.2015) in a graduated manner.

(iii). Transfer between categories:

Reclassification of investments from one category to the other, if done, is in accordance with the RBI
guidelines. Transfer of scrips from AFS/HFT category to HTM category is made at the lower of book value
or market value. In the case of transfer of securities from HTM to AFS/HFT category, the investments held
under HTM at a discount are transferred to AFS/HFT category at the acquisition price and investments
placed in the HTM category at a premium are transferred to AFS/HFT at the amortized cost.
Transfer of investments from AFS to HFT or vice versa is done at the book value. Depreciation carried, if
any, on such investments is also transferred from one category to another.

(iv). Valuation of Securities:

a) Investments in “Held to Maturity” category are accounted for at acquisition cost or at amortised cost, if
acquired at a premium. In case the cost is higher than the face value, the premium is amortised over the
period remaining to maturity using Constant Yield Method. Such amortisation of premium is adjusted
against income under the head “Income on Investments”. Where the face value is higher than the cost,
the discount is ignored and is accounted only on maturity date of the instrument.
b) Securities classified as “Available for Sale” are marked to market scrip-wise on a quarterly basis and
net depreciation in each category is provided for, while net appreciation is ignored.
c) Individual scrips in “Held for Trading” category are marked to market at daily intervals and net
depreciation in each category is provided for, while net appreciation is ignored.
d) Treasury Bills and Certificate of Deposits are valued at carrying cost.
e) Security receipts are valued as per the Net Asset Value (NAV) obtained from the issuing
Reconstruction Company/Securitisation Company.
f) Profit on sale of investments in ‘Held to Maturity’ category is recognised in the Profit and Loss
Account and an equivalent amount net of taxes and transfer to Statutory Reserves is appropriated to
Capital Reserve.

(v). Investments are also classified as Performing and Non Performing as per the guidelines of RBI and
provisions on Non Performing investments are made as per the provisioning norms of RBI.

Limit on Transactions through Individual Brokers

RBI specifies a limit of 5% of total transactions through brokers (both purchase and sales) entered into by a bank
during a year should be treated as the aggregate upper contract limit for each of the approved brokers.

Short-selling

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Short Sale’ is defined as sale of securities which are not owned by bank. As per the RBI guidelines banks and
primary dealers are allowed to undertake short sale of government dated securities, subject to the short position
being covered within a maximum period of three months, including the day of trade. Further, such short positions
shall be covered only by outright purchase of an equivalent amount of the same security or through a long position
in the ‘when issued market’ or allotment in primary auction.

Regulations relating to deposits

As per the Master Circular on “Interest Rates on Rupee Deposits held in Domestic, Ordinary Non-Resident (NRO)
and Non-Resident (External) (NRE) Accounts”, dated July 1, 2014, issued by RBI, banks are permitted to
independently determine rates of interest offered on Domestic/NRO Accounts (minimum period of seven days) as
well as term deposits of maturity of one year and above under NRE deposit accounts. However, interest rates offered
by banks on NRO and NRE deposits cannot be higher than those offered by them on comparable domestic rupee
depositsFurther, banks are not permitted to pay interest rates on current account deposits. In respect of savings and
time deposits accepted from employees, banks are permitted by the RBI to pay an additional interest of one per cent
over the interest payable on deposits from public.

Deposit insurance

Demand and time deposits of up to ` 100,000 accepted by Indian banks (other than primary co-operative societies)
have to be mandatorily insured with the Deposit Insurance and Credit Guarantee Corporation, a wholly-owned
subsidiary of the RBI. Banks are required to pay the insurance premium for the eligible amount to the Deposit
Insurance and Credit Guarantee Corporation on a half yearly basis. The cost of the insurance premium cannot be
passed on to the customer.

Regulations relating to Knowing the Customer and Anti-Money Laundering

Prevention of Money Laundering Act, 2002

In order to prevent money laundering activities the PMLA was enacted which seeks to prevent money laundering
and to provide for confiscation of property derived from, or involved in money laundering, and for incidental
matters connected therewith. Section 12 of the PMLA casts certain obligations on, inter alia, banking companies in
relation to preservation and reporting of customer account information. The RBI has advised all banks to go through
the provisions of the PMLA and the rules notified thereunder and to take all steps considered necessary to ensure
compliance with the requirements of section 12 of the PMLA.

Regulations relating to KYC and anti-money laundering

The RBI issued a master circular on July 1, 2014 consolidating the guidelines for KYC and anti-money laundering
procedures. With effect from April 1, 2012, banks are not permitted to make payment of cheques/drafts/pay
orders/banker’s cheques bearing that date or any subsequent date, if they are presented beyond the period of three
months from the date of such instrument. Further, banks are required to frame their KYC policies incorporating (i)
customer acceptance policy, (ii) customer identification procedures, (iii) monitoring of transactions and (iv) risk
management.

Statutory Reserve Requirements

CRR

A bank company is required to maintain, a specified percentage of its Demand and Time Liabilities, excluding
interbank deposits, by way of a balance in a current account with the RBI. At present the required CRR is 4%. The
RBI does not pay any interest on CRR balances. The CRR has to be maintained on an average basis for a fortnightly
period and should not be below 95% of the required CRR on any day of the fortnight. The RBI may impose penal
interest if CRR is not maintained as per the regulations.

SLR

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In addition to the CRR, a bank is required to maintain SLR, a specified percentage of its NDTL by way of liquid
assets like cash, gold or approved unencumbered securities. The percentage of this liquidity ratio is fixed by the RBI
from time to time, pursuant to Section 24 of the Banking Regulation Act. At present, the RBI requires banks to
maintain SLR of 21.5%. Further, the RBI has permitted banks to avail funds from the RBI on an overnight basis,
under the marginal standing facility, against their excess SLR holdings. Additionally, they can also avail themselves
of funds, on an overnight basis below the stipulated SLR, up to 1% of their respective NDTL outstanding at the end
of the second preceding fortnight. The fourth bi-monthly monetary policy 2014-15 of RBI also stipulates the facility
of liquidity up to 5 % of NDTL, in addition to MSF.

Regulations on Liquidity Risk Management

At present, RBI’s regulations for asset liability management require banks to draw up asset-liability gap statements.
These gap statements are prepared by scheduling all assets and liabilities according to the stated and anticipated re-
pricing date, or maturity date and behaviour studies that may be conducted by banks.

RBI stipulates formulating of a contingency funding plan (CFP), conduct of stress testing at regular intervals,
establishing an effective funding strategy, proper management of intra-day liquidity, etc. In relation to liquidity Risk
management, banks are also required to adhere to the regulatory limits prescribed to reduce the extent of
concentration on the liability side of the banks which includes IBL limit, call money borrowing, call money lending,
etc.

Regulations relating to authorised dealers for foreign exchange and cross-border business transactions

The foreign exchange and cross border transactions undertaken by banks are subject to the provisions of the Foreign
Exchange Management Act. All branches should monitor all non-resident accounts to prevent money laundering.
The RBI master circular on “External Commercial Borrowings and Trade Credits”, dated July 1, 2014, states that no
financial intermediary, including banks, will be permitted to raise external commercial borrowings or provide
guarantees in favour of overseas lenders for external commercial borrowings.

The RBI master circular on “Risk Management and Interbank Dealings”, dated July 1, 2014, states that all
categories of overseas foreign currency borrowings of banks, including existing external commercial borrowings
and loans or overdrafts from their head office, overseas branches and correspondents and overdrafts in nostro
accounts (not adjusted within five days), shall not exceed 100% of their unimpaired Tier I capital or USD $ 10
million (or its equivalent), whichever is higher. Overseas borrowings for the purpose of financing export credit,
subordinated debt placed by head offices of foreign banks with their branches in India as Tier II capital, capital
funds raised/ augmented by the issue of innovative perpetual debt instruments and any other overseas borrowings
with the specific approval of the RBI would continue to be outside the limit of 100%.

Prohibited Business

The Banking Regulation Act specifies the business activities in which a bank may engage. Banks are prohibited
from engaging in business activities other than the specified activities.

Declaration of dividend by banks

The payment of dividends by banks is subject to restrictions under the Banking Regulation Act. Section 15(1) of the
Banking Regulation Act states that no banking company may pay any dividend on its shares until all its capitalised
expenses (including preliminary expenses, organisation expenses, share-selling commissions, brokerage, amounts of
losses incurred and any other item of expenditure not represented by tangible assets) have been completely written
off. In addition, section 17(1) of the Banking Regulation Act requires every banking company to create a reserve
fund and, out of the balance of the profit of each year as disclosed in the profit and loss account, transfer a sum
equivalent to not less than 20% of the net profit before appropriations to the reserve fund before declaring any
dividend, (As per RBI requirements, banks should transfer not less than 25% of the net profit before appropriations
to the reserve fund.) Further, in May 2005, the RBI issued guidelines on “Declaration of Dividends by Banks”,
which prescribed certain conditions for declaration of dividends by banks.

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Appointment and Remuneration of the Chairman, Managing Director and Other Directors

Banks are required to obtain prior approval of RBI before appointing the chairman and managing director and any
other whole-time directors and fix their remuneration. RBI is empowered to remove an appointee to the posts of
chairman, managing director and whole-time directors on the grounds of public interest, interest of depositors or to
ensure our proper management. Further, RBI may order meetings of our Board of Directors to discuss any matter in
relation to us appoint observers to such meetings and in general, may make such changes to the management as it
may deem necessary and may also order the convening of a general meeting of our shareholders to elect new
directors.

Issue of Bonus Shares

Banks require a prior permission of RBI to issue bonus shares as prescribed under the Banking Regulation Act.

Secrecy obligations

A bank’s obligations relating to maintaining secrecy arise out of common law principles governing its relationship
with its customers. The practices and usages customary among bankers are to be observed by all banks subject to
certain exceptions, a bank cannot disclose any information to third parties. Further, the RBI may, in the public
interest, publish the information obtained from the bank.

Regulations and guidelines of SEBI

SEBI was established to protect the interests of public investors in securities and to promote the development of, and
to regulate, the Indian securities market. Banks are subject to SEBI regulations for equity and debt capital issuances,
banker to the issue, custodial and depositary participant activities. These regulations provide for our registration with
the SEBI for each of these activities, functions and responsibilities. Banks are required to adhere to a code of
conduct applicable for these activities.

Foreign Ownership restrictions

The total foreign ownership in a private sector bank cannot exceed 74.00% (49.00% under the automatic route and
beyond 49.00% and up to 74.00% under the approval route) of the paid-up capital subject to guidelines for setting up
branches or subsidiaries of foreign banks issued by the RBI. Shares held by FIIs/ FPIs cannot exceed 24.00% of the
paid-up capital of a bank unless approved by the board of directors as well as the bank’s shareholders by way of a
special resolution. However, FIIs/ FPIs cannot hold more than 49% of the paid-up capital of the bank. Similarly, the
aggregate shareholding of NRIs cannot exceed 10% of the paid-up capital of a bank unless approved by the board of
directors and the shareholders in special resolution.

Investments in Indian companies can be made both by non-resident and resident Indian entities. While investment
by a non-resident entity in an Indian company is considered a foreign investment, investment by resident Indian
entities could also comprise a non-resident investment. If the Indian investing company is ‘owned’ or ‘controlled’ by
non-resident entities, investments made by such an investing company into an Indian company may also be
considered as a foreign investment.

Income Tax Benefits

As a banking company, our Bank is entitled to certain tax benefits under the Income Tax Act including the
following:

(i). The bank’s dividend income is exempt from income tax. As per the provisions of Section 14A of the Income-
tax Act, no deduction is allowed in respect of any expenditure incurred in relation to such dividend income to
be computed in accordance with the method as may be prescribed under rule 8D subject to and in accordance
with the provisions contained therein.

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(ii). The bank is entitled to a tax deduction on the provisioning towards bad and doubtful debts equal to 7.50% of
the bank’s total business income, computed before making any deductions prescribed under Section
36(1)(viii)(a) of the I.T. Act, and to the extent of 10.00% of the aggregate average advances made by our
rural branches computed in the manner prescribed.

The Banking Ombudsman Scheme, 2006

The Banking Ombudsman Scheme, 2006 provides the extent and scope of the authority and functions of the
Banking Ombudsman for redressal of grievances against deficiency in banking services, concerning loans and
advances and other specified matters. On February 3, 2009, the said scheme was amended to provide for revised
procedures for redressal of grievances by a complainant under the scheme.

Payment and Settlement Systems Act

The Payment and Settlement Systems Act, 2007 was introduced to provide for the regulation and supervision of
payment systems by the RBI. The said act authorizes the RBI to permit the setting up and continuance of payment
and settlement systems, to set standards, to call for returns and information, to audit and inspect, to issue directions,
and to impose penalties and initiate prosecution for violations of the said act.

Guidelines for merger and amalgamation of private sector banks

The RBI issued the “Guidelines on Mergers and Amalgamation of Private Sector Banks” in May 2005. The
guidelines relate to: (i) an amalgamation of two banking companies; and (ii) an amalgamation of a NBFC with a
banking company. In the case of an amalgamation of two banking companies, the draft scheme of amalgamation
must be approved by the board and majority of the shareholders of each of the banking companies. Additionally,
such approved draft scheme must also be submitted to the RBI for sanction.

Where a NBFC is proposed to be amalgamated into a banking company, the banking company should obtain the
approval of the board and the RBI before it is submitted to the relevant high court for approval.

Guidelines on management of intra-group transactions and exposures

The RBI issued the “Guidelines on Management of Intra-Group Transactions and Exposures” on February 11, 2014.
Pursuant to the said guidelines, RBI has prescribed quantitative limits on financial intra-group transactions and
exposures and prudential measures for the non-financial intra-group transactions and exposures. The objective of
these guidelines is to ensure that banks engage in intra-group transactions and exposures in safe and sound manner
in order to contain concentration and contagion risks arising out of such transactions.

Capital and provisioning requirements for exposures to entities with unhedged foreign currency exposure

RBI issued a circular relating to “Capital and Provisioning Requirements for Exposures to entities with Unhedged
Foreign Currency Exposure” on January 15, 2014. Pursuant to these guidelines, RBI has introduced incremental
provisioning and capital requirements for bank exposures to entities with unhedged foreign currency exposures. The
circular also lays down the method of calculating the incremental provisioning and capital requirements. The banks
will be required to calculate the incremental provisioning and capital requirements at least on a quarterly basis. This
framework became fully effective from April 1, 2014.

Framework for revitalising distressed assets in the economy

RBI issued the framework for revitalising distressed assets in the economy on January 30, 2014 which lays down the
corrective action plan that will incentivise early identification of problem cases, timely restructuring of accounts
which are considered to be viable, and taking prompt steps by banks for recovery or sale of unviable accounts. The
salient features of this framework include, inter alia, (a) early formation of a lenders’ committee with timelines to
agree to a plan for resolution, (b) incentives for lenders to agree collectively and quickly to a plan - better regulatory
treatment of stressed assets if a resolution plan is underway, accelerated provisioning if no agreement can be
reached, and (c) independent evaluation of large value restructurings mandated, with a focus on viable plans and a

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fair sharing of losses (and future possible upside) between promoters and creditors. This framework became fully
effective on April 1, 2014.

Classification and Reporting of Fraud Cases

The RBI issued a master circular on July 1, 2014 in relation to the classification and reporting of fraud cases. The
circular classifies fraud cases into:(i) misappropriation and criminal breach of trust; (ii) fraudulent encashment
through forged instruments, manipulation of books of account or through fictitious accounts and conversion of
property; (iii) unauthorised credit facilities extended for reward or for illegal gratification; (iv) negligence and cash
shortages; (v) cheating and forgery; (vi) irregularities in foreign exchange transactions and; (vii) any other type of
fraud not coming under the specific heads as above. Information relating to frauds for the quarters ending June,
September and December may be placed before the audit committee of the board of directors during the month
following the quarter to which it pertains, irrespective of whether or not these are required to be placed before the
board/management committee in terms of the calendar of reviews prescribed by the RBI. Banks are also required to
conduct an annual review of the frauds and place a note before the board of directors for information. The reviews
for the year-ended March may be put up to the Board before the end of the next quarter i.e. for the quarter ended
June 30 and such reviews need not be sent to RBI. These may be preserved for verification by the Reserve Bank’s
inspecting officers. Further, the circular requires all banks to constitute a special committee for monitoring and
follow up of cases of frauds involving amounts of `10 million and above exclusively, while the audit committee
may continue to monitor all cases of fraud in general. The special committee is required to review such fraud cases
as and when they come to light. The special committee in case of private sector banks should consist of two
members of the audit committee of the board and two members from the Board excluding the RBI nominee.

Term Repo borrowing by banks

Repo means an instrument for borrowing funds by selling securities of the central Government or a state
Government or of such securities of a local authority as may be specified in this behalf by the Central Government
or foreign securities, with an agreement to repurchase the said securities on a mutually agreed future date at an
agreed price which includes interest for the fund borrowed. If the period is fixed and agreed in advance, it is a term
repo where either party may call for the repo to be terminated at any time although requiring one or two day’s'
notice. Term repo is a year and half old window for providing liquidity to the banking system. Through Term repo
auctions of 7-day and 14-day tenors for a combined notified amount equivalent to 0.75 per cent of NDTL of the
banking system are conducted by the Reserve Bank through variable rate auctions on every Friday, since the
beginning of October 11, 2013. Additional term repos of tenors ranging from 5-day to 28-day have also been
auctioned on the basis of periodic assessment of liquidity conditions. The notified amount and tenor of the term repo
auctions is announced prior to the dates of the auctions.

Liquidity Adjustment Facility:

RBI implemented Liquidity Adjustment Facility (LAF) from June 5, 2000. Pursuant to the recommendations of the
Narasimham Committee Report on Banking Reforms (Narasimham Committee II), it was decided in principle, to
introduce a LAF operated through repo and reverse repo. LAF is a facility extended by the RBI to the scheduled
commercial banks (excluding RRBs) and primary dealers to avail of liquidity in case of requirement or park excess
funds with the RBI in case of excess liquidity on an overnight basis against the collateral of Government securities
including State Government securities. Basically LAF enables liquidity management on a day to day basis. The
operations of LAF are conducted by way of repurchase agreements with RBI being the counter-party to all the
transactions. The interest rate in LAF is fixed by the RBI from time to time. LAF is an important tool of monetary
policy and enables RBI to transmit interest rate signals to the market.

Collateralised Borrowing and Lending Obligation:

RBI in its Mid-term Review Policy and Credit Policy for the year 2002-03, mooted for introduction of Collateralised
Borrowing and Lending Obligation (CBLO) and vide its letter No. MPD.227/07.01.279/2002-03, dated December
20, 2002 decided to permit CBLO developed by CCIL. CBLO segment was introduced with effect from January 20,
2003. CBLO is a money market instrument operated by the Clearing Corporation of India Limited (CCIL), for the
benefit of the entities who have either no access to the inter-bank call money market or have restricted access in

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terms of ceiling on call borrowing and lending transactions. CBLO is a discounted instrument available in electronic
book entry form for the maturity period ranging from one day to ninety days (up to one year as per RBI policy). By
participating in the CBLO market, CCIL members can borrow or lend funds against the collateral of eligible
securities. Borrowers in CBLO have to deposit the required amount of eligible securities with the CCIL based on
which CCIL fixes the borrowing limits. CCIL matches the borrowing and lending orders submitted by the members
and notifies them. While the securities held as collateral are in custody of the CCIL, the beneficial interest of the
lender on the securities is recognized through proper documentation.

Loans to Micro Small and Medium Enterprises (MSEs)

Pursuant to RBI’s Master Circular on Lending to Micro, Small and Medium Enterprises (MSME) Sector, dated July
1, 2014, advances to micro and small enterprises (MSE) sector shall be reckoned in computing achievement under
the overall Priority Sector target of 40 percent of Adjusted Net Bank Credit (ANBC) or credit equivalent amount of
Off-Balance Sheet Exposure, whichever is higher. Bank loans above ` 50 million per borrower / unit to Micro and
Small Enterprises engaged in providing or rendering of services and defined in terms of investment in equipment
under MSMED Act, 2006 shall not be reckoned in computing achievement under the overall above Priority Sector
targets. In terms of the recommendations of the Prime Minister’s Task Force on MSMEs, banks are advised to
achieve a 20 per cent year-on-year growth in credit to micro and small enterprises and a 10 per cent annual growth
in the number of micro enterprise accounts.

In order to ensure that sufficient credit is available to micro enterprises within the MSE sector, banks are to ensure
that, (a) 40 per cent of the total advances to MSE sector should go to micro (manufacturing) enterprises having
investment in plant and machinery up to ` 1 million and micro (service) enterprises having investment in equipment
up to ` 0.40 million; (b) 20 per cent of the total advances to MSE sector should go to micro (manufacturing)
enterprises with investment in plant and machinery above ` 1 million and up to ` 2.50 million, and micro (service)
enterprises with investment in equipment above ` 0.40 million and up to ` 1 million. Thus, 60 per cent of MSE
advances should go to the micro enterprises.

RBI’s Master Circular on Loans and Advances – Statutory and Other Restrictions, dated July 1, 2014 prescribes that
MSE units having working capital limits of up to Rupees fifty million from the banking system are to be provided
working capital finance computed on the basis of 20 percent of their projected annual turnover. The banks are
directed to adopt the simplified procedure in respect of all MSE units which includes new as well as existing.

Non – Agricultural Gold Loans

Pursuant to RBI notifications titled “Non-Agriculture Loans against Gold Ornaments and Jewelry” dated December
30, 2013, “Loans against Gold Ornaments and Jewellery for Non-Agricultural End-uses” dated July 22, 2014 and
subject to conditions specified in afore-mentioned notification, RBI has permitted bullet repayment of loan extended
against pledge of gold ornaments and jewellery for other than agricultural purposes. RBI with its another notification
titled, “Lending against Gold Jewellery”, dated January 20, 2014, prescribed a Loan to Value (LTV) Ratio of not
exceeding 75 per cent for banks’ lending against Gold jewellery (including bullet repayment loans against pledge of
gold jewelry). Therefore, loans sanctioned by banks cannot exceed 75 per cent of the value of gold ornaments and
jewellery.

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 HISTORY AND CERTAIN CORPORATE MATTERS

Brief History of our Bank

Our Bank was incorporated on November 26, 1920 under the Indian Companies Act, 1913 as ‘The Catholic Syrian
Bank Limited’. A fresh certificate of incorporation under the Companies Act, 1956 was issued by the RoC on April
14, 1987. The registration number of our Bank is 000175 and our CIN number is U65191KL1920PLC000175.

In 1964 and 1965, our Bank took over the assets and liabilities of six small and medium sized banks located in
Kerala. In August 1969, our Bank was included in the second schedule to the Reserve Bank of India Act, 1934 and
in 1975, our Bank attained the status of ‘A’ Class scheduled Bank.

Changes in our Registered Office

The Registered Office of our Bank is currently located at CSB Bhavan, Post Box 502, St. Mary’s College Road,
Thrissur 680 020, Kerala, India. Further, the RegisteredOffice of our Bank was shifted to its current location on
January 30, 1978 to facilitate operational convenience.

Major Events and Milestones

The following table illustrates the major events and milestones in the history of our Bank:

Calendar year Key events, milestones and achievements

1920 Incorporation of our Bank
1945 Our Bank celebrated its silver jubilee
1964-65 Our Bank took over the assets and liabilities of six small and medium sized banks located in Kerala
1969 Our Bank included in the second schedule to the Reserve Bank of India Act, 1934
1970 Our Bank celebrated its golden jubilee
1972 Opened our first branch in the state of Maharashtra
1973 Opened our first branch in the state of Karnataka
1980 Our Bank celebrated its diamond jubilee
1995 Our Bank celebrated its platinum jubilee
2003 Changed the logo and colour scheme to create a new image of our Bank
2004 Total business (advances plus deposits) crossed ` 50,000 million
2007 Investment of ` 332.97 million by AIF Capital Development Limited, GPE III Mauritius Direct
Investment Limited and Singuler Guff Bric Mauritius
2009 Total business (advances plus deposits) crossed ` 100,000 million
2013 Total business (advances plus deposits) crossed ` 200,000 million
Entered in to an agreement with Edelweiss Tokio Life Insurance Company Limited to distribute life
insurance products

Strike and lock-outs

In the year 2007, our Bank’s Kolkata branches (Lal Bazar and Burra Bazar) were closed for 93 days due to the strike
called for by The Catholic Syrian Bank Ltd Staff Union. Other than strikes by our unionized employees on account
of national labor strikes which affected the entire unionized banking sector, our Bank has not experienced any
strikes, lock-outs and employee unrest in the last five years.

Changes in activities of our Bank

There have been no changes in the activities of our Bank since the last five years, which may have had a material
effect on our profits or loss, including discontinuance of our lines of business, loss of agencies or markets and
similar factors.

Defaults or rescheduling of borrowings with financial institutions/banks, conversion of loans into equity by the Bank

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There have been no defaults or rescheduling of borrowings with financial institutions, other banks, conversion of
loans into equity in relation to our Bank.

Capital raising (Equity/ Debt)

Our equity issuances in the past and details of our indebtedness as on December 31, 2014 have been provided in
sections titled “Capital Structure” and “Financial Indebtedness” on pages 81 and 248, respectively.

Our Bank has not undertaken any public offering of debt instruments since its inception.

Pre-IPO Placement

Our Bank, in consultation with the BRLMs, is considering the Pre-IPO Placement of up to 12,500,000 Equity Shares
for cash consideration aggregating up to ` 1,500 million, at its discretion, prior to filing of the Red Herring
Prospectus with the RoC. If the Pre-IPO Placement is completed, the number of Equity Shares issued pursuant to the
Pre-IPO Placement will be reduced from the Issue, subject to a minimum Net Issue size of 25% of the post Issue
paid-up equity share capital being offered to the public.

Our Main Objects

Our objects as contained in our Memorandum of Association are:

Clause 3 Particulars
a) To establish and carry on the business of banking at the registered or head office of the company at Thrissur and at
such other branches, offices, departments, agencies at such places in India or abroad as may, from time to time, be
determined by the directors.
b) To carry on the business of receiving or accepting deposits of money as current, fixed, savings deposits, provident
deposits or otherwise, withdrawable by cheque, draft or order or in any other permissible manner, and to carry on
the business of a bank as referred to herein at its offices, branches and departments.
c) To borrow, raise or accept money; to lend or advance money either upon or without security or in any other way; to
draw, make, accept, discount, buy, sell, collect and deal in bills of exchange, hoondees, promissory notes, coupons,
drafts, bills of lading, railway receipts, warrants, debentures, certificates, scrips and other instruments and securities
whether transferable or negotiable or not and to advance money on the security of them; to negotiate and issue loans
and advances; to grant and issue letters of credit, traveller’s cheques and circular notes; to buy, sell and deal in silver
and gold in bullion and specie, coins or otherwise in any form, foreign exchange including foreign bank notes; to
subscribe, acquire, hold, issue on commission, underwrite and deal in stock, funds, shares, debentures, debenture
stock, bonds, obligations, securities and investments of all kinds; to purchase and sell bonds, scrips or other forms of
securities for and on behalf of constituents or others; to receive all kinds of bonds, scrips, documents and other
valuables as deposit or for safe custody or otherwise, and to provide for safe deposit vaults; to convert the movable
and immovable properties of the constituents and others into money, collect and pay them; and to collect and
transmit money, securities and instruments.
d) To act as agents for any Government or local authority or any other person or persons; and to transact all kinds of
agency business which are ordinarily transacted by banks on behalf of customers and others, and to act as attorneys
and to give discharges and receipts.
e) To effect, insure, guarantee, underwrite, and participate in managing and carrying out of any issue, public or private,
of State, municipal or other loans or of shares, stock, debentures, or debenture stock of any company, corporation or
association and to lend money for the purpose of any such issue.
f) To carry on and transact every kind of guarantee and indemnity business.
g) To promote or finance or assist in promoting or financing any business, undertaking or industry, either existing or
new, and to develop or form the same under the constitution of company or otherwise, either through the
instrumentality of syndicates or otherwise, as may be permissible under the provisions of the Banking Regulation
Act, 1949 as amended or modified from time to time or under other regulatory guidelines.
h) To undertake, create and execute trusts; and to undertake the administration of estates as executor, trustee,
administrator or otherwise.
i) To establish and support or to aid in the establishment and support of associations, institutions, funds, trusts and
conveniences calculated to benefit employees or ex-employees of the company or the dependents or connections of
such persons; to grant pensions and allowances and to make payments towards insurance; to subscribe to or
guarantee moneys for charitable or benevolent objects or for any exhibition or for any public, general or useful
object.

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 Clause 3 Particulars
j) To deposit money with other banks by way of current deposits, fixed deposits and otherwise with or without
interest, to accept bills of exchange, hundies and other negotiable instruments and to endorse the same to bankers
and to do all such banking business as are generally done by bankers with bankers and others.
k) To incur expenses of a sum not exceeding ten percent of the net profits of the company for all such matters which in
the opinion of the company are for the benefit of the banking business, for the safety of the bankers and for the
convenience of the members and for carrying out of the same.
l) To purchase, to take on kanom, lease or rent or acquire by other means any immovable property or any rights
therein as the company may think necessary or convenient, with reference to any of the objects and to construct
buildings or any other works necessary for the Bank.
m) To hold or purchase shares, stocks, debentures or other rights of such a company whose objects are similar to those
of all or some of this company or whose business can be profitably conducted by this company and accept
ownership thereof and to purchase the business of any similar company with all or some of the assets and liabilities
and amalgamate the same with the business of this company or to manage the same on special contract or as
mortgagee or in any other manner.
n) To start one or more companies with a view to purchase the properties, assets and liabilities of this company as a
whole or by part for any other matter which the company thinks will be for its benefit and to reconstruct any other
company having transaction with this company and amalgamate with it and to work as promoters, receivers &
liquidators for such purposes.
o) To promote, set-up, establish, incorporate, register or otherwise bring into existence subsidiary or associate
companies, firms, trusts or any other form of organisation either singly or in association with other Banks/Financial
Institutions for the purpose of undertaking and carrying on merchant banking activities, leasing and hire purchase
businesses, housing including housing finance, factoring and forfaiting services as may be permitted by the Reserve
Bank of India.
p) To promote, set-up, establish, incorporate, register or otherwise bring into existence subsidiary or associate
companies, joint ventures, either singly or in association with other banks/institutions/ companies/Agencies, as
provided under the Banking Regulation Act, 1949 and other relevant enactments, for the purpose of undertaking and
carrying on the activities of procurement, development, installation, provision, offering and marketing of
Information Technology enabled Banking and Financial products, solutions and services as may be permissible for
such subsidiary/ associate companies, joint ventures to engage in and carry on as per the Banking Regulation Act,
1949 or as may be permitted by Reserve Bank of India, and/or to undertake and carry on such activities in-house by
the Bank.
q) To promote, set-up, establish and administer mutual funds of all types as may be permitted by the Reserve Bank of
India, either singly or in association with other Banks/ financial institutions and/or to promote, set-up, establish,
incorporate, register or otherwise bring into existence wholly owned or partly owned subsidiary companies, firms,
trusts or any other form of organisation for the purpose of undertaking and carrying on such mutual fund businesses.
r) To promote, set up, establish, incorporate, register or otherwise bring into existence subsidiary or associate
companies, firms, trusts or any other form of organization either singly or in association with other Banks/Financial
Institutions for the purpose of carrying on any other activities/business not specifically provided in the preceding
sub clauses, including lending or financial operations of any form or nature as may be permissible for any Banking
Company to undertake/carry on as per Section 6 of the Banking Regulation Act, 1949 as may be amended/modified,
or such other activities/ businesses as may be permitted by the Reserve Bank of India, from time to time.
s) To engage in and carry on any activity of Merchant Banking as may be permissible including inter alia the business
of issue management by making arrangements regarding selling, buying, subscribing to securities and/or acting as
adviser, consultant, manager, underwriter, portfolio manager and also to engage in venture capital business,
acquisitions, mergers and amalgamations and all related merchant banking activities including loan syndication, or
rendering corporate advisory service in relation to any of such activities.
t) To undertake and carry on Credit Card business and/or business of any identical or similar nature either singly or in
association with other Banks/Financial Institutions.
u) To create, issue and allot Innovative Capital Instruments/Perpetual Debt Instruments, hybrid debt capital
instruments/subordinated debt instruments of long term maturity, whether unsecured or secured by all or some of
the assets and properties of the Company, and to provide for their liquidation, redemption, substitution, cancellation
or renewal by appropriation from profits, transfer from Reserves and/or out of the proceeds of a fresh issue of
securities/instruments.
v) To issue debentures and debenture stock on the security of all or some of the company’s properties and to make
profit by doing all kinds of insurance business by engaging in agriculture, trade, industry and others by starting or
causing others to engage in them and conducting kuries and doing all such things as the Bank deems fit.
w) To sell, realize, improve, manage, develop, let on lease, mortgage or otherwise deal with all or any of the properties
and rights of the company including those properties, rights and securities which may have come into the possession
of the company in satisfaction or part satisfaction of any of its claims, debts or dues; and to acquire and hold and
generally deal with any property or any right, title or interest in any such property which may form the security or

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Clause 3 Particulars
part of the security for any loans or advances or which may be connected with any such security.
x) To open, establish, maintain and operate currency chests and small coin depots on such terms and conditions as may
be required by the Reserve Bank of India established under the Reserve Bank of India Act, 1934 and enter into all
administrative or other arrangements for undertaking such functions with the Reserve Bank of India.
y) To do all such other things as are incidental or conducive to the promotion or advancement of the business of the
company; to undertake and carry on any other form of business which the Central Government may, by notification
in the Official Gazette, specify as a form of business in which it is lawful for a banking company to engage
z) To engage in and carry on the business of equipment leasing, hire purchase financing, factoring services or other
para-banking or other activities, operations, dealings or businesses as may be permitted by the Reserve Bank of
India.
aa) To undertake, engage in and carry on any insurance business without any risk participation by or contingent liability
for the Bank either by acting as agent of insurance company/companies on fee basis for distribution of insurance
products or by investing in the equity of insurance company/ companies for providing infrastructure and services
support OR by equity participation in one or more insurance joint venture with or without risk participation, OR in
any other manner as may be permitted by the Reserve Bank of India.

Amendments in our Memorandum of Association

Since incorporation, other than changes in our authorised share capital, which have been detailed in the section titled
“Capital Structure” on page 81, the following changes have been made to our Memorandum of Association:

Date of Amendment Details of Amendment

September 26, 1991 The following object was added to the objects clauses of our MoA:

“To open, establish, maintain and operate currency chests and small coin depots on such terms
and conditions as may be required by the Reserve Bank of India established under the Reserve
Bank of India Act, 1934 and enter into all administrative or other arrangements for undertaking
such functions with the Reserve Bank of India”
September 29, 1992 The following object was added to the objects clauses of our MoA:

“To promote, set-up, establish and administer mutual funds of all types as may be permitted by the
Reserve Bank of India, either singly or in association with other Banks/financial institutions and/
or to promote, set-up, establish, incorporate, register or otherwise bring into existence wholly
owned or partly owned subsidiary companies, firms, trusts or any other form of organisation for
the purpose of undertaking and carrying on such mutual fund businesses”
September 29, 1993 The following objects were added to the objects clauses of our MoA:

“To engage in and carry on any activity of Merchant Banking as may be permissible including
inter alia the business of issue management by making arrangements regarding selling. buying,
subscribing to securities and/or acting as adviser, consultant, manager, underwriter, portfolio
manager and also to engage in venture capital business, acquisitions, mergers and amalgamations
and all related merchant banking activities including loan syndication, or rendering corporate
advisory service in relation to any of such activities

To undertake and carry on Credit Card business and/or business of any identical or similar nature
either singly or in association with other Banks/Financial Institutions.”
October 29, 1994 The following object was added to the objects clauses of our MoA:

To engage in and carry on the business of equipment leasing, hire purchase financing, factoring
services or other para-banking or other activities, operations, dealings or businesses as may be
permitted by the Reserve Bank of India.”
July 30, 2002 The following object was added to the objects clauses of our MoA:

“To undertake, engage in and carry on any insurance business without any risk participation by or
contingent liability for the Bank EITHER by acting as agent of insurance company/companies on
fee basis for distribution of insurance products or by investing in the equity of insurance company/
companies for providing infrastructure and services support OR by equity participation in one or
more insurance joint venture with or without risk participation, OR in any other manner as may be
permitted by the Reserve Bank of India.”

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Date of Amendment Details of Amendment
September 27, 2007 The following object was added to the objects clauses of our MoA:

“To create, issue and allot Innovative Capital Instruments/ Perpetual Debt Instruments, hybrid
debt capital instruments/subordinated debt instruments of long term maturity, whether unsecured
or secured by all or some of the assets and properties of the Company, and to provide for their
liquidation, redemption, substitution, cancellation or renewal by appropriation from profits,
transfer from Reserves and/or out of the proceeds of a fresh issue of securities/instruments.”
September 29, 2011 The following object was added to the objects clauses of our MoA:

“To promote, set up, establish, incorporate, register or otherwise bring into existence subsidiary
or associate companies, firms, trusts or any other form of organization either singly or in
association with other Banks/Financial Institutions for the purpose of carrying on any other
activities/business not specifically provided in the preceding sub clauses, including lending or
financial operations of any form or nature as may be permissible for any Banking Company to
undertake/carry on as per Section 6 of the Banking Regulation Act, 1949 as may be
amended/modified, or such other activities/ business as may be permitted by the Reserve Bank of
India, from time to time.”
September 28, 2012 The following object was added to the objects clauses of our MoA, substituting existing clauses
3(a), (b), (c), (q) and (s):

“To establish and carry on the business of banking at the registered or head office of the company
at Thrissur and at such other branches, offices, departments, agencies at such places in India or
abroad as may, from time to time, be determined by the directors.”

“To carry on the business of receiving or accepting deposits of money as current, fixed, savings
deposits, provident deposits or otherwise, withdrawable by cheque, draft or order or in any other
permissible manner, and to carry on the business of a bank as referred to herein at its offices,
branches and departments.”

“To borrow, raise or accept money; to lend or advance money either upon or without security or in
any other way; to draw, make, accept, discount, buy, sell, collect and deal in bills of exchange,
hoondees, promissory notes, coupons, drafts, bills of lading, railway receipts, warrants,
debentures, certificates, scrips and other instruments and securities whether transferable or
negotiable or not and to advance money on the security of them; to negotiate and issue loans and
advances; to grant and issue letters of credit, traveller’s cheques and circular notes; to buy, sell
and deal in silver and gold in bullion and specie, coins or otherwise in any form, foreign exchange
including foreign bank notes; to subscribe, acquire, hold, issue on commission, underwrite and
deal in stock, funds, shares, debentures, debenture stock, bonds, obligations, securities and
investments of all kinds; to purchase and sell bonds, scrips or other forms of securities for and on
behalf of constituents or others; to receive all kinds of bonds, scrips, documents and other
valuables as deposit or for safe custody or otherwise, and to provide for safe deposit vaults; to
convert the movable and immovable properties of the constituents and others into money, collect
and pay them; and to collect and transmit money, securities and instruments.”

“To sell, realize, improve, manage, develop, let on lease, mortgage or otherwise deal with all or
any of the properties and rights of the company including those properties, rights and securities
which may have come into the possession of the company in satisfaction or part satisfaction of any
of its claims, debts or dues; and to acquire and hold and generally deal with any property or any
right, title or interest in any such property which may form the security or part of the security for
any loans or advances or which may be connected with any such security.”

“To do all such other things as are incidental or conducive to the promotion or advancement of the
business of the company; to undertake and carry on any other form of business which the Central
Government may, by notification in the Official Gazette, specify as a form of business in which it is
lawful for a banking company to engage.”

The following objects were added to the objects clauses of our MoA:

“To act as agents for any Government or local authority or any other person or persons; and to
transact all kinds of agency business which are ordinarily transacted by banks on behalf of
customers and others, and to act as attorneys and to give discharges and receipts.”

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Date of Amendment Details of Amendment

“To effect, insure, guarantee, underwrite, and participate in managing and carrying out of any
issue, public or private, of State, municipal or other loans or of shares, stock, debentures, or
debenture stock of any company, corporation or association and to lend money for the purpose of
any such issue.”

“To carry on and transact every kind of guarantee and indemnity business.”

“To promote or finance or assist in promoting or financing any business, undertaking or industry,
either existing or new, and to develop or form the same under the constitution of company or
otherwise, either through the instrumentality of syndicates or otherwise, as may be permissible
under the provisions of the Banking Regulation Act, 1949 as amended or modified from time to
time or under other regulatory guidelines.”

“To undertake, create and execute trusts; and to undertake the administration of estates as
executor, trustee, administrator or otherwise.”

“To establish and support or to aid in the establishment and support of associations, institutions,
funds, trusts and conveniences calculated to benefit employees or ex-employees of the company or
the dependents or connections of such persons; to grant pensions and allowances and to make
payments towards insurance; to subscribe to or guarantee moneys for charitable or benevolent
objects or for any exhibition or for any public, general or useful object.”

Shareholders

As on March 27, 2015, the total number of holders of Equity Shares is 25,602. For more details on the shareholding
of our Bank, please see the section titled “Capital Structure” on page 81.

Holding Company

As on the date of this Draft Red Herring Prospectus, our Bank does not have a holding company.

Subsidiaries and Joint Ventures

As on the date of this Draft Red Herring Prospectus, our Bank does not have any subsidiary or joint venture.

Injunction or Restraining Order

Except as disclosed below and in sections titled “Risk Factors” and “Outstanding Litigation and Material
Developments” on page 13 and 251, respectively, our Bank is not operating under any injunction or restraining
order.

Pursuant to a letter dated January 30, 2015 from RBI in relation to the broadening of capital base and listing of the
Equity Shares, the general permission to open new branches was withdrawn and our Bank was not permitted to open
any new branches without prior approval of RBI.

Business and Management

For details of our Bank’s corporate profile, business, products, marketing, the description of our activities, market
segment, the growth of our Bank, standing of our Bank in relation to prominent competitors with reference to its
services, technology, market, and geographical segment, please see the sections titled “Our Business” and
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 127 and 191,
respectively. For details of the management of our Bank and its managerial competence, please see the section titled
“Our Management” on page 172.

Details regarding acquisition of business/undertakings, mergers, amalgamation, revaluation of assets

170
Our Bank has not acquired any business or undertaken any mergers or amalgamation in the past five years. Further,
our Bank has undertaken revaluation of land and buildings during Fiscals 1991, 1994, 1999, 2005, 2007, 2008 and
2013. For further details, please see section titled “Financial Statements” on page 190.

Shareholders’ Agreement

Our Bank has not entered into any shareholders agreements.

Material Agreements

Our Bank has not entered into any material agreements other than in the ordinary course of business.

Strategic and Financial Partners

Our Bank does not have any strategic or financial partners.

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 OUR MANAGEMENT

The composition of our Board is governed by the provisions of the Companies Act, the Banking Regulation Act, and
our Articles of Association. As per the provisions of our Articles of Association, the Board shall comprise of not less
than five and not more than 12 Directors. The Directors appointed by Reserve Bank of India will not be counted for
determining the maximum strength of the Board as per Section 36AB of the Banking Regulation Act, 1949 and
hence their number will be excluded for determining the maximum number of Directors on the Board of our Bank.
We currently have 12 Directors on our Board, of which 5 Directors are Non-executive Directors and 5 Directors are
Independent Directors. Further, two Directors are RBI Nominees. The position of Managing Director and Chief
Executive Officer is now vacant on the Board of Directors of our Bank.

Further, as per the provisions of our Articles of Association, not less than 51% of the total number of Directors shall
be persons who satisfy the conditions laid down in Section 10A of the Banking Regulation Act, which requires that
at least 51% of Directors to have specialized knowledge or practical experience in one or more of the following
areas: accountancy, agriculture and rural economy, banking, cooperation, economics, finance, law, small-scale
industry and any other matter as RBI may specify. Out of the aforesaid number of Directors, not less than two
Directors are required to have specialized knowledge or practical experience in agriculture and rural economy,
cooperation or small-scale industry. Also, not less than 51% of the Directors, shall be persons who do not have
substantial interest in, or be connected with, whether as an employee, manager or managing agent, of any company
(not being a company registered under Section 25 of the Companies Act, 1956) or firm which carries on any trade,
commerce or industry which is not a small scale industrial concern, or be proprietors of any trading, commercial or
industrial concern which is not a small scale industrial concern.

Under the Banking Regulation Act, the appointment or re-appointment of part-time Chairman and whole-time
Directors requires the approval of the RBI. The RBI has also prescribed “fit and proper” criteria to be considered
when appointing or re-appointing directors of banks, with the Bank’s Directors being required to make declarations
confirming their on-going compliance with such criteria. As on date of this Draft Red Herring Prospectus, the Board
of Directors of our Bank is in compliance with the above mentioned conditions Executive functions are currently
being performed by our Committee of Directors consisting of Mr. K. Subrahmanya Sarma, Mr. C. K. Gopinathan
and Ms. Radha Unni.

The following table sets forth details regarding our Board as of the date of filing of this Draft Red Herring
Prospectus:

Name, Designation, Address, Occupation, Age Other Directorships

Nationality, Term and DIN (in years)

Mr. S. Santhanakrishnan 64  SANDS BKC Properties Private Limited

 SANDS Chembur Properties Private Limited
Designation: Part-time Chairman; Non-
 Tata Coffee Limited
executive Director
 IDBI Federal Life Insurance Limited
Address: No. 24, Unnamalai Ammai Street, T.  Extensible Business Reporting Language India
Nagar, Tamil Nadu, Chennai 600 017  Tata Realty and Infrastructure Limited
 Tata Housing Development Co. Limited
Occupation: Chartered Accountant  The Eight O’ Clock Coffee Company
 Consolidated Coffee Inc.
Nationality: Indian
 Tata Global Beverages Limited
Term: Reappointed as part-time Chairman on  ICICI Home Finance Limited
August 17, 2012 till August 16, 2015 and re-
appointed as part-time Chairman on July 17,
2014 from August 17, 2015 to January 15, 2017
which is subject to RBI approval. Reappointed
as a Director effective September 29, 2014 till
January 15, 2017 which coincides with his
tenure of appointment as part time Chairman.

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 Name, Designation, Address, Occupation, Age Other Directorships
Nationality, Term and DIN (in years)

DIN: 00032049

Mr. Ajay Lal 53  AIF Capital (India) Private Limited

 AIF Capital Partners Limited
Designation: Non-executive Director
 Famy Care Limited
Address: No. 909 B, The Aralias, DLF Golf  Bioplus Life Sciences Private Limited
Links, Gurgaon, Haryana 122 009  Century Metal Recycling Private Limited

Occupation: Service and Consultancy

Nationality: Indian

Term: Liable to retire by rotation (effective

from April 1, 2015)

DIN: 00030388

Mr. T. S. Anantharaman 66  Sree Sakthi Paper Mills Limited, Cochin

 Trichur Heart Hospital Limited, Trichur
Designation: Non-executive Director
 INBOT Properties Private Limited
Address: 27/376, Temple View, Chembukavu,  Mobme Wireless Solutions Limited
City Post Office, Kerala, Thrissur, 680 020

Occupation: Business

Nationality: Indian

Term: Reappointed on September 28, 2012,

liable to retire by rotation

DIN: 00480136

Mr. Bobby Jos C. 41  Chirakkekaran Builders Private Limited

 Keralakshemam Unique Kuries Private Limited
Designation: Non-executive independent
Director

Address: Chirakkekaran House, Bishop Palace

Road, East Fort, Kerala, Thrissur 680 005

Occupation: Business

Nationality: Indian

Term: Two years from September 26, 2014, not

liable to retire by rotation.

DIN: 03270042

Mr. C. K. Gopinathan 60  CKG Super Market Limited

Designation: Non-executive Director

Address: Chittilangat Kalam, Koottanad P.O.,

Kerala, Palakkad 679 533

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 Name, Designation, Address, Occupation, Age Other Directorships
Nationality, Term and DIN (in years)

Occupation: Business

Nationality: Indian

Term: Reappointed on September 26, 2014,

liable to retire by rotation

DIN: 01236752

Mr. K. Subrahmanya Sarma 70  Gold Stone Technologies Limited

Designation: Non-executive Director

Address: No. 8-2-677/B/1, Road No. 12, Banjara

Hills, Andhra Pradesh, Hyderabad 500 034

Occupation: Retired officer of the Indian

Administrative Services

Nationality: Indian

Term: Reappointed on September 23, 2013,

liable to retire by rotation

DIN: 01505787

Mr. Sumeer Bhasin 51  G2 Solutions (India) Private Limited

 MSS (India) Private Limited
Designation: Non-executive independent
 Veda Botanicals Private Limited
Director
 Fisource Solutions (India) Private Limited
Address: A-88, Defence Colony, New Delhi 110  Consilium Futurity Education Private Limited
024  USTRONICS.com (India) Private Limited

Occupation: Service and Consultancy

Nationality: Indian

Term: Two years from September 26, 2014, not

liable to retire by rotation.

DIN: 00952238

Ms. Radha Unni 66  Nitta Gelatine India Limited, Kochi

 Muthoot Capital Services Limited
Designation: Non-executive independent
 Sundaram BNP Paribas Home Finance Limited
Director
 Royal Sundaram Alliance Insurance Company
Address: No. 21/6,Riverview, Fourth Main Limited
Road, Gandhi Nagar, Adyar, Tamil Nadu,
Chennai 600 020

Occupation: Retired Banker

Nationality: Indian

Term: Two years from September 26, 2014, not

liable to retire by rotation.

174
 Name, Designation, Address, Occupation, Age Other Directorships
Nationality, Term and DIN (in years)

DIN: 03242769

Mr. S. Ramakrishnan 58  Shree Bharathi Cotton Mills Private Limited

Designation: Non-executive independent
Director

Address: No. 1A, Sankaram, No. 11, Rani

Annadurai Street, Raja Annamalaipuram, Tamil
Nadu, Chennai 600 028

Occupation: Chartered Accountant

Nationality: Indian

Term: Two years from September 26, 2014, not

liable to retire by rotation.

DIN: 02255401

Mr. M. Madhavan Nambiar 64  Larsen & Tourbo Infrastructure Limited

 Rediff.com India Limited
Designation: Non-executive independent
 Hotel Leelaventure Limited
Director
 Punj Lloyd Limited
Address: No. 3, Nawab Habibullah Avenue,  Loyal Textile Mills Limited
Third Street, Tamil Nadu, Chennai 600006  Kerala State Industrial Development
Corporation Limited
Occupation: Retired officer of the Indian  Air works India Engineering (Private) Limited
Administrative Services

Nationality: Indian

Term: Two years from September 26, 2014, not

liable to retire by rotation.

DIN: 03487311

Mr. K. Neethi Ragavan 58 Nil

Designation: Additional Director - RBI

Nominee

Address: Flat No. Q 206, Reserve Bank Staff

Quarters, P.H. Road, Tamil Nadu, Chennai 600
010

Occupation: General Manager, RBI, Chennai

Nationality: Indian

Term: Till May 22, 2015

DIN: 06617935

Mr. V. G. Venkatachalapathy 53 Nil

Designation: Additional Director - RBI

Nominee

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 Name, Designation, Address, Occupation, Age Other Directorships
Nationality, Term and DIN (in years)

Address: No. 2, 10th Cross Street, Indira Nagar,

Adyar, Tamil Nadu, Chennai 600 020

Occupation: General Manager, Foreign

Exchange Department, RBI, Chennai

Nationality: Indian

Term: Till March 12, 2017

DIN: 07137366

Brief Profiles of our Directors

Mr. S. Santhanakrishnan is the part-time Chairman of our Bank. He has been associated with our Bank as a
Director since January 16, 2009 and as our part-time Chairman since August 17, 2010. He holds a bachelor’s degree
in science and a bachelor’s degree in law. He has been a fellow of the Institute of Chartered Accountants of India for
over 30 years and is a practicing Chartered Accountant. He is also a member of the Council (southern region) of the
Institute of Chartered Accountants of India. He is currently associated with entities in the banking, insurance and
manufacturing sectors. He is also a member of various panels of the Ministry of Corporate Affairs. Prior to joining
our Board, he was associated with Federal Bank Limited as a director till 2009. He is also a partner of PKF Sridhar
& Santhanam, LLP, Chennai, a firm of practicing Chartered Accountants.

Mr. Ajay Lal is a non-executive Director of our Bank. He holds a bachelor’s degree in technology (chemical
engineering) from the Indian Institute of Technology, Delhi, a post graduate diploma in management from the
Indian Institute of Management, Kolkata and has completed an advanced management program at the Harvard
Business School in 2008. Mr. Lal has served as a director on the board of Yes Bank Limited and Bharti Airtel
Limited and is currently on the boards of AIF Capital (India) Private Limited and AIF Capital Partners Limited. He
has been a Director of our Bank since September 13, 2007.

Mr. T. S. Anantharaman is a non-executive Director of our Bank. He holds a bachelor’s degree in commerce from
the University of Kerala. He has been a fellow of the Indian Institute of Chartered Accountants for over 40 years and
has previously worked for the United Nations. He has been a Director of our Bank since August 28, 2009.

Mr. Bobby Jos C. is a non-executive independent Director of our Bank. He holds a bachelor’s degree in commerce
from the University of Calicut and a master’s degree in business administration from the Bharathiar University. He
has been a Director of our Bank since September 30, 2010.

Mr. C. K. Gopinathan is a currently a non-executive Director of our Bank and has been on our Board since
September 26, 2008.

Mr. K. Subrahmanya Sarma is a non-executive Director of our Bank and has been on our Board since September
30, 2010. He holds a bachelor’s degree in arts (honours), a master’s degree in arts and a master’s degree in science
all from Andhra University. He also holds a diploma in computer applications from the National Institute for
Training in Industrial Engineering, Mumbai and a diploma in development administration from the University of
Birmingham. He is a retired officer of the Indian Administrative Services, has held various administrative posts with
the Government of Andhra Pradesh and retired as the chief executive officer of Prasar Bharti in 2004.

Mr. Sumeer Bhasin is a non-executive independent Director of our Bank. He holds a bachelor’s degree in
commerce (honours) from the University of Delhi. He has been a Director of our Bank since August 28, 2009.

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Ms. Radha Unni is a non-executive independent Director of our Bank. She holds a bachelor’s degree in arts
(honours) and a master’s degree in arts both from the University of Delhi as well as a bachelor’s degree in education
from the Annamalai University. She has been a certified associate of the Indian Institute of Bankers since 1982.
Prior to joining our Bank, she held various positions at State Bank of India, including a two year deputation to SBI
Capital Markets Limited and retired as the Chief General Manger of State Bank of India. She has been a Director of
our Bank since September 29, 2011.

Mr. S. Ramakrishnan is a non-executive independent Director of our Bank and has been on our Board since
September 29, 2011. He is a partner of M/s S. Ramakrishnan Associates which is a firm of Chartered Accountants.

Mr. M. Madhavan Nambiar is a non-executive independent Director of our Bank and has been associated with our
Bank since September 23, 2013. He is a fellow of the Judge Business School, Cambridge University, has taught at
Oxford University and Columbia University and has been officer of the Indian Administrative Service since 1974.

Mr. K. Neethi Ragavan has been a nominee of the RBI on our Board since May 23, 2013. He holds a bachelor’s
degree in business administration and a master’s degree in commerce both from the Madurai Kamaraj University.
He has been an associate of the Indian Institute of Bankers for about 30 years. He is currently the General Manager
of the Reserve Bank of India at Chennai.

Mr. V. G. Venkatachalapathy has been a nominee of the RBI on our Board since March 13, 2015. He holds a
bachelor’s degree in arts (economics) and master’s degree in arts from the Madras University, a master’s degree in
science (with a major in financial markets) from the Illinois Institute of Technology, Chicago and is a certified
associate of the Indian Institute of Bankers and holds a diploma in bank management from the Indian Institute of
Bankers. He has about five years of experience in commercial banking. He is the General Manager, Foreign
Exchange Department of the RBI at Chennai.

Relationship between our Directors

None of our Directors are related to each other.

Details of directorships in companies suspended or delisted from any stock exchange

None of our Directors is or was a director of any listed company during the last five years preceding the date of
filing of this Draft Red Herring Prospectus, whose shares have been or were suspended from being traded on the
BSE or the NSE. Further, none of our Directors is or was a director of any listed company which has been or was
delisted from any stock exchange.

Remuneration of our Directors

Mr. S. Santhanakrishnan, as per RBI approval dated July 31, 2012, is entitled to a remuneration of ` 0.6 million per
annum, along with travelling and halting allowances in accordance with RBI circular dated June 10, 1998 and sitting
fees as applicable to other Directors.

Pursuant to a resolution dated November 14, 2013 and in accordance with Section 310 of the Companies Act, 1956
read with Rule 10B of the Companies (Central Government’s) General Rules & Forms, 1956 and Article 132(a) of
the AoA, the sitting fee payable to our non-executive Directors for attending meetings of the Board, Audit
Committee and Credit Committee of the Board is ` 20,000 and for meetings of the remaining committees is `
10,000. Our non-executive Directors do not receive any other remuneration, other than reimbursement of expenses
for attending meetings of our Board of the committees of our Board. Provided below are details of sitting fees paid
to our non-executive Directors for Fiscal 2014:

Name of Director Sitting fees (`)*

Mr. S. Santhanakrishnan 237,799
Mr. Ajay Lal 107,799
Mr. T. S. Anantharaman 273,397
Mr. Bobby Jos C. 325,598

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 Name of Director Sitting fees (`)*
Mr. C. K. Gopinathan 441,196
Mr. K. Subrahmanya Sarma 365,598
Mr. Sumeer Bhasin 355,598
Ms. Radha Unni 373,397
Mr. S. Ramakrishnan 355,598
Mr. M. Madhavan Nambiar 57,799
Mr. K. Neethi Ragavan^ Nil
Mr. V. G. Venkatachalapathy^ Nil
Mr. V. Seshadri 488,995
Mr. Ipe Peter 375,598
* Adjusted for TDS and service taxes.
^ Our Bank does not pay sitting fees to the nominees of the RBI on our Board.

Remuneration paid or payable from subsidiaries and associate companies

Our Bank does not have any subsidiaries or associates.

Appointment of relatives to an office or place of profit

None of the relatives of our Directors have been appointed to a place or office of profit in our Bank.

Service Contracts

There are no service contracts entered into by our Bank with any of the Directors for provision of any benefits or
payments upon termination of employment.

Shareholding of Directors

Our Directors are not required to hold any qualification shares.

For details of shareholding of our Directors in our Bank, see the section titled “Capital Structure – Shareholding of
Directors and Key Management Personnel” on page 91. Our Bank does not have any subsidiaries or associates and
consequently, none of our Directors hold any shares in subsidiaries or associates.

Changes in the Board of Directors in the Last Three Years

Name of the Director Date of Change Reason for Change

Mr. Venkataraman Krishnamurthy June 22, 2012 Resignation from Directorship
Mr. V. P. Iswardas November 30, 2012 Ceased to be the Managing Director and Chief Executive Officer
Mr. V. Seshadri January 24, 2013 Appointed as an Additional Director - RBI nominee
Mr. Rakesh Bhatia April 1, 2013 Appointed as Managing Director and Chief Executive Officer
Mr. Ranjana Sahajwala May 23, 2013 Ceased to be an Additional Director - RBI nominee
Mr. K. Neethi Ragavan May 23, 2013 Appointed as an Additional Director - RBI nominee
Mr. M. Madhavan Nambiar September 23, 2013 Appointed as a non-executive Director
Ms. Radha Unni September 26, 2014 Appointed as an non-executive independent Director*
Mr. K. Ipe Peter September 26, 2014 Appointed as an non-executive independent Director*
Mr. Sumeer Bhasin September 26, 2014 Appointed as an non-executive independent Director*
Mr. S. Ramakrishnan September 26, 2014 Appointed as an non-executive independent Director*
Mr. Bobby Jos C. September 26, 2014 Appointed as an non-executive independent Director*
Mr. M. Madhavan Nambiar September 26, 2014 Appointed as an non-executive independent Director*
Mr. K. Ipe Peter September 26, 2014 Resigned as a non-executive independent Director
Mr. Rakesh Bhatia March 20, 2015 Resigned as Managing Director and Chief Executive Officer
Mr. V. Seshadri March 13, 2015 Ceased to be an Additional Director - RBI nominee
Mr. V. G. Venkatachalapathy March 13, 2015 Appointed as an Additional Director - RBI nominee
* Pursuant to Section 149 of the Companies Act, 2013.

Borrowing Powers of Board

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In accordance with the Articles of Association and subject to the provisions of the Companies Act, 2013 and the
Companies Act, 1956, to the extent applicable, our Board is authorized, pursuant to a special resolution of the
shareholders of our Bank dated August 18, 2014, to borrow money from time to time and as and when required, in
excess of our Bank’s paid-up capital and free reserves, provided that the aggregate of such borrowings including the
money already borrowed by our Bank and outstanding at any point of time, shall not exceed ` 10,000 million over
and above its paid up capital and free reserves.

Corporate Governance

Our Bank is currently in compliance with the requirements of corporate governance contained in the Listing
Agreements, the Companies Act, 1956 and the Companies Act, 2013, as applicable, as well as applicable RBI
directions and the Banking Regulation Act, particularly in relation to the composition of our Board and the
constitution of committees.

Currently our Board has 12 Directors all of whom are non-executive including our chairman. In compliance with the
requirements of Clause 49 of the Listing Agreements and the Companies Act, 2013, our Bank has five independent
Directors.

Audit Committee

The audit committee was originally constituted by our Board pursuant to a meeting dated June 6, 1994 and was last
re-constituted on March 23, 2015. The composition of the audit committee is as follows:

Name of the Director Position on the Committee Designation

Mr. S. Ramakrishnan Chairman Non-executive independent Director
Mr. Sumeer Bhasin Member Non-executive independent Director
Mr. M. Madhavan Nambiar Member Non-executive independent Director
Mr. K. Subrahmanya Sarma Member Non-executive Director
Mr. V. G. Venkatachalapathy* Member Additional Director - RBI Nominee
Mr. K. Neethi Ragavan* Member Additional Director - RBI Nominee
* Quorum of the committee requires at least one of them to be present.

The scope and function of the audit committee and its terms of reference, in accordance with applicable RBI
directions, include the following:

1. To oversee the operations of the total audit function in the Bank, review of internal inspections/audit
functions and quality and effectiveness in terms of follow-up;
2. To review the inspection reports of specialized and extra-large branches and all branches with
unsatisfactory ratings, to obtain and review half-yearly reports from the compliance officers appointed in
the Bank, follow up on all the issues raised in the long form audit report and to follow up on all the
issues/concerns raised in the inspection reports of RBI;
3. To closely monitor the inspection/audit functions of the Bank, including the follow up and compliance of
inspection/audit reports;
4. To provide suggestions/directions to further streamline systems and procedures; and
5. To make periodical reviews of returns/statements placed before it as per the approved calendar of items.

The additional terms of reference are as under:

1. Overseeing the Bank’s financial reporting process and disclosure of its financial information to ensure that
the financial statement is correct, sufficient and credible;
2. Recommending to the Board, the appointment, re-appointment and replacement, remuneration and terms of
appointment of the statutory auditor and the fixation of audit fee;
3. Reviewing and monitoring the auditor’s independence and performance and effectiveness of audit process;

179
4. Approval of payments to the statutory auditors for any other services rendered by statutory auditors,
reviewing with the management, the quarterly, half-yearly and annual financial statements and the auditors’
report thereon before submission to the Board for approval;
5. Scrutiny of inter-corporate loans and investments;
6. Valuation of undertakings or assets of the Bank, wherever it is necessary;
7. Evaluation of internal financial controls and risk management systems;
8. Approval or any subsequent modification of transactions of the Bank with related parties;
9. Reviewing with the management, the statement of uses/application of funds raised through an issue (public
issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those
stated in the offer document/prospectus/notice and the report submitted by the monitoring agency
monitoring the utilization of proceeds of a public or rights issue and making appropriate recommendations
to the Board to take up steps in this matter;
10. Reviewing, with the management, the performance of statutory and internal auditors and adequacy of the
internal control systems;
11. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit
department, staffing and seniority of the official heading the department, reporting structure coverage and
frequency of internal audit;
12. Discussion with internal auditors any significant findings and follow up thereon;
13. Reviewing the findings of any internal investigations by the internal auditors into matters where there is
suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the
matter to the Board;
14. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well
as post-audit discussion to ascertain any area of concern;
15. Looking into the reasons for substantial defaults in the payment to the depositors, debenture holders,
shareholders (in case of non-payment of declared dividends) and creditors;
16. Approval of appointment of the chief financial officer (i.e., the whole-time finance Director or any other
person heading the finance function or discharging the function) after assessing the qualifications,
experience and background, etc. of the candidate;
17. Reviewing the functioning of the whistle blower mechanism, in case the same is existing; and
18. To have an oversight over the vigil mechanism established by the Bank and the chairman of audit
committee shall directly hear grievances of victimization of employees and directors, who used vigil
mechanism to report genuine concerns.
19. Carrying out any other functions as is mentioned in the terms of reference of the Audit Committee.

The powers of the Audit Committee include the following:

1. To investigate any activity within its terms of reference;

2. To seek information from any employees;
3. To obtain outside legal or other professional advice; and
4. To secure attendance of outsiders with relevant expertise, if it considers necessary.

The Audit Committee shall mandatorily review the following information:

1. Management discussion and analysis of financial condition and result of operations;

2. Statement of significant related party transactions (as defined by the Audit Committee), submitted by
management;
3. Management letters/ letters of internal control weaknesses issued by the statutory auditors;
4. Internal audit reports relating to internal control weaknesses;
5. The appointment, removal and terms of remuneration of the chief internal auditor; and
6. Any other terms of reference as may be included from time to time in clause 49 of the listing agreement.

Nomination and Remuneration Committee

The nomination committee and the remuneration committee were originally constituted separately pursuant to
resolutions of our Board dated August 10, 2004 and September 30, 2010, respectively, with the remuneration

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committee being re-designated as the remuneration and compensation committee pursuant to a resolution of our
Board dated March 12, 2014.

Both committees were merged and re-designated as the Nomination and Remuneration Committee of our Board,
pursuant to a resolution our Board dated March 23, 2015 in compliance with provisions of Section 178 of the
Companies Act, 2013.

The composition of the Nomination and Remuneration Committee is as follows:

Name of the Director Position on the Committee Designation

Mr. S. Ramakrishnan Chairman Non-executive independent Director
Mr. Bobby Jos C. Member Non-executive independent Director
Mr. S. Santhanakrishnan Member Part-time Chairman, Non-executive Director
Ms. Radha Unni Member Non-executive independent Director

The scope and function of the Nomination and Remuneration Committee and its terms of reference are as follows:

1. Identification of persons who are qualified to become directors and who may be appointed in senior
management in accordance with the criteria laid down;
2. Undertake the due diligence of candidates before their appointment/re-appointment as directors;
3. Recommend to the Board appointment of directors and senior management personnel and their removal;
4. Formulate the criteria for determining qualification, positive attributes and independence of a director, key
managerial personnel and other employees;
5. Recommend to the Board the policy for evaluation of directors;
6. To oversee the framing, review and implementation of the Bank's overall compensation structure and
related policies on remuneration packages payable to whole time directors, the Managing Director and
Chief Executive Officer and other staff as may be prescribed from time to time including performance
linked incentives, perquisites, stock option scheme etc. with a view to attract, motivate and retain
employees and review compensation levels;
7. To implement and administer the CSB Employees Stock Option Scheme 2013;
8. To formulate detailed terms and conditions of the scheme, administer and supervise the same and to allot
shares in compliance with the scheme, guidelines and other applicable laws;
9. To obtain necessary clearances and approvals from regulatory authorities and do such other things as may
be necessary in respect of the ESOS 2013;
10. To make suggestions to amend any stock option plans or incentive plans, provided that all amendments to
such plans shall be subject to consideration and approval of the Board;
11. To review the compensation structure/policy on a periodical basis;
12. Any other matters regarding remuneration of whole time directors, the Managing Director and Chief
Executive Officer and other staff of the Bank as may be prescribed as and when permitted by the Board;
13. Any other matters regarding compensation structure as and when permitted by the Board; and
14. To fulfill such other powers and duties as may be delegated to it by the Board.

Stakeholders’ Relationship Committee

The Stakeholders’ Relationship Committee was originally constituted as the shareholders’ /investors’ grievance
committee by the Board pursuant to a meeting dated July 2, 2002. It was subsequently reconstituted and re-
designated as the Stakeholders’ Relationship Committee pursuant to a resolution of our Board dated February 19,
2015. Its composition is as follows:

Name of the Director Position on the Committee Designation

Mr. K. Subrahmanya Sarma Chairman Non-executive Director
Mr. Bobby Jos C. Member Non-executive independent Director
Mr. S. Ramakrishnan Member Non-executive independent Director

The scope and function of Stakeholders’ Relationship and Share Transfer Committee and its terms of reference
include the following:

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1. Issue and allot shares subject to the provisions of the Section 39 of the Companies Act, 2013 read with the
Companies (Prospectus and Allotment of Securities) Rules, 2014, Section 46 of the Companies Act, 2013
read with Companies (Share Capital and Debentures) Rules, 2014 and subject to the Memorandum and
Articles of Association of the Bank, to effect the transfer, transposition and transmission of securities;
2. To consider and approve, split, consolidation and duplication of shares or other securities;
3. To approve dematerialization and re-materialization of shares;
4. To seek any information it requires from the employees, directors of the Bank in order to perform its
functions;
5. To do all such other things as are necessary thereto pursuant to and in accordance with the employee stock
option schemes and the decision of the Board in connection with allotment of shares under the schemes;
6. Investor relations and redressal of shareholders’ grievances in general and relating to non-receipt of
dividends, interest, non-receipt of balance sheet etc.;
7. To resolve the grievances of security holders of the Bank; and
8. Such other matters as may be, from time to time, required by any statutory, contractual or other regulatory
requirements to be attended to by such committee.

Interest of Directors

Our Directors, other than nominees of the RBI on our Board, may be deemed to be interested to the extent of
reimbursement of expenses and sitting fees, if any, payable to them for attending meeting of Board and committees
and to the extent of remuneration, if any, paid to them for services rendered as an officer or employee of our Bank.

Our Directors may also be regarded as interested in Equity Shares, if any, held by them or that may be subscribed by
or allotted to the companies, firms, trusts, in which they are interested as directors, members, partners, trustees and
promoters, pursuant to this Issue. All our Directors may also be deemed to be interested to the extent of any
dividend payable to them and other distributions in respect of the said Equity Shares, held by them, if any.

Our Directors may also be regarded as interested to the extent of stock options that may be granted to them from
time to time under the ESOS 2013, if any. For details of ESOS 2013, please see the section titled “Capital Structure
– Employee Stock Option and Stock Purchase Schemes” at page 92.

Interest in promotion of our Bank

None of our Directors are interested in the promotion of our Bank.

Interest in property and transaction involving acquisition of land

Except as disclosed in the section titled “Financial Statements – Related Party Transactions” on page F-178, our
Directors do not have any interest in any property acquired by or proposed to be acquired by our Bank in the two
years prior to filing of this Draft Red Herring Prospectus and are not interested in any transaction with our Bank
involving acquisition of land, construction of building or supply of any machinery.

Interest in the business of our Bank

Except as stated above, our Directors do not have any other interest in the business of our Bank.

182
 Management Organization Chart

Managing Director and

Board of Directors
Chief Executive Officer

Deputy
Company
General
Secretary Head Strategy
Head Retail Chief Compliance Manager
and Chief Financial and Chief of
Distribution Officer Vigilance
Compliance Officer Staff
Strategy (Jiz P. Audit and
Officer (P. V. Antony) (Prem Kumar
(Sekhar Rao) Kottukappally) Inspection
(Sijo Thampi)
(Thomas K.
Varghese)
George)

Head Retail Head Wholesale Head Human Business

Business Head
Marketing and Banking and Chief Credit Resources and Head Rest of
Kerala
Product Treasury Officer Operations India
(Kurian
Management (Anand (M. P. Davies) (Mohan Menon (Ajith
George)
(Bharath Mani) Krishnamurthy) T.) Prabhakar)

Our Key Management Personnel

Our Key Management Personnel are as below:

Mr. P. V. Antony, 53 years, is the Chief Financial Officer of our Bank. He holds a bachelor’s degree in commerce
from the University of Calicut and has been admitted as a certified associate of the Indian Institute of Banking and
Finance, an associate member of the Institute of Company Secretaries of India and a fellow of the Institute of Cost
Accountants of India, formerly the Institute of Cost and Works Accountants of India. He has about 31 years of
experience in the field of banking. Prior to joining our Bank, he was associated with Canara Bank. He has been
associated with our Bank since September 26, 1983 and is inter alia, responsible for finalization and reporting of
accounts, balance sheet management and profit planning, cost management, tax planning, capital adequacy planning
and management and coordinating the capital raising activities of our Bank. The total remuneration paid to Mr. P.V.
Antony in Fiscal 2014 was ` 1.16 million.

Mr. Sijo Varghese, 39 years, is the Company Secretary and Compliance Officer of our Bank. He holds a bachelor’s
degree in commerce from the University of Calicut and a bachelor’s degree in law from the Mahatma Gandhi
University. He is an associate of the Institute of Company Secretaries of India. He has about seven years of
experience in the field of banking. Prior to joining our Bank, he was associated with M/s Kerala Ayurveda Limited
as their company secretary until November 30, 2007 and has been associated with our Bank since December 2007.
He is responsible for executing the orders of our Board regarding administration of our Bank and acts as an advisor
to our Board, liaises with the RBI and other regulatory bodies, including the Registrar of Companies. The total
remuneration paid to Mr. Sijo Varghese in Fiscal 2014 was ` 0.77 million.

Mr. Anand Krishnamurthy, 46 years, is the Head of Wholesale Banking and Treasury of our Bank. He holds a
bachelor’s degree in technology (mechanical engineering) from the Indian Institute of Technology, Madras and a
post graduate diploma in management from the Indian Institute of Management, Calcutta. He has about 22 years of
experience in the field of banking having previously worked with the Hongkong and Shanghai Banking Corporation
Limited for that period. He has been associated with our Bank since April 7, 2014 and is presently responsible for
corporate banking, SME business and the integrated treasury operations of our Bank. He joined our Bank post
March 31, 2014 and accordingly no remuneration was paid to him in Fiscal 2014. He currently holds charge and

183
looks after the day to day affairs of the Bank under the supervision of the Committee of Directors who currently
perform executive functions for our Managing Director and Chief Executive Officer.

Mr. Mohan Menon T., 55 years, is the Head of Human Resources and Operations of our Bank. He holds a
bachelor’s degree in commerce from the University of Calicut and is an associate of the Indian Institute of Bankers.
He has about 33 years of experience in the field of banking. Prior to joining our Bank, he was associated with
Mohan & Mohan Associates, Chartered Accountants. He has been associated with our Bank since June 29, 1981 and
is responsible for overseeing our internal inspection and audit functions. The total remuneration paid to him in Fiscal
2014 was ` 1.11 million.

Mr. Ajith Prabhakar, 53 years, is the Business Head (Rest of India) of our Bank. He holds a bachelor’s degree in
commerce from the University of Calicut, a master’s degree in commerce from the University of Kerala and has
been an associateof the Indian Institute of Bankers since 1988. He has about 34 years of experience in the field of
banking having been associated with our Bank since July 10, 1981. He is currently responsible for overseeing our
operations in India outside of Kerala and accordingly overseeing zonal performance. The total remuneration paid to
him in Fiscal 2014 was ` 1.17 million.
Mr. Kurian George, 55 years, is the Business Head (Kerala) of our Bank. He holds a bachelor’s degree in science
from the University of Calicut, a diploma in End-User Computing and Executive Skills from the Council of
Education and Training, First Computers and is an associate of the Indian Institute of Banking and Finance. He has
been associated with our Bank since June 1, 1981 and accordingly has about 34 years of experience in the field of
banking. He is currently responsible for overseeing our operations in Kerala. The total remuneration paid to him in
Fiscal 2014 was ` 1.15 million.

Mr. Bharath Mani, 44 years, is the Head of Retail Marketing and Product Management of our Bank. He holds a
post graduate diploma in business management from the Institute of Management Technology, Ghaziabad and a
Bachelor of Arts degree in Economics from the University of Delhi. He has over 21 years around 22 years of
experience in the field of banking and financial services. Prior to joining our Bank, he was associated with The
Royal Bank of Scotland N.V. as their Senior Vice President and Head of Branch Banking - India. Prior to this, he
has worked in various capacities and geographies in ABN AMRO Bank N.V., Bank of America and Countrywide
Consumer Financial Services (Joint venture of HDFC and GE). He has been associated with our Bank since April 1,
2014 and is responsible for our Marketing and Product Strategy, Retail Assets and Gold loan portfolio, NRI business
and our priority sector businesses including agricultural loans and financial inclusion. He joined our Bank post
March 31, 2014 and accordingly no remuneration was paid to him in Fiscal 2014.

Mr. Sekhar Rao, 46 years, is the Head of Retail Distribution Strategy of our Bank. He holds a bachelor’s degree in
engineering and a master’s in business administration both from the University of Pune. He has about 11 years of
experience in the field of banking. Prior to joining our Bank, he was associated with ING Vysya Bank as their
National Sales Head – Liability Sales, Ratnakar Bank as their Regional Head and EVP – South Zone (Retail Branch
Banking) and ICICI Bank as a Deputy General Manager. He has been associated with our Bank since March 3, 2014
and is responsible for our CASA portfolio, development of our branches and ATMs and customer relations
particularly in relation to our institutional clients. The total remuneration paid to him in Fiscal 2014 was ` 0.39
million.
Mr. Prem Kumar Thampi, 54 years, is the Head of Strategy and Chief of Staff of our Bank. He holds a bachelor’s
degree in science (honours) and a master’s degree in physics both from the Banaras Hindu University and is a fellow
of the Institute of Directors. He has about 29 years of experience in the field of banking. Prior to joining our Bank,
he was associated with ICICI Bank for 14 years, State Bank of India for 11 years and with Bank M (Tanzania)
Limited as their Deputy Chief Executive Officer until June 2013. He has been associated with our Bank since March
1, 2015 and is responsible for our strategy development. He joined our Bank post March 31, 2014 and accordingly
no remuneration was paid to him in Fiscal 2014.

Mr. Jiz P. Kottukapally, 41 years, is the Chief Compliance Officer of our Bank. He holds a bachelor’s degree in
commerce from the University of Calicut, a post graduate diploma in financial advising from, and is also an
associate of the Indian Institute of Banking and Finance. He has also cleared the final examination of the Institute of
Cost Accountants of India (formerly the Institute of Cost and Works Accountants of India). He has been associated
with our Bank since January 18, 1996 and accordingly has about 19 years of experience in the field of banking. He

184
is responsible for coordinating compliances, particularly in relation to the RBI. The total remuneration paid to him in
Fiscal 2014 was ` 0.98 million.

Mr. M. P. Davies, 55 years, is the Chief Credit Officer of our Bank. He holds a bachelor’s degree in science from
the University of Calicut, is a Chartered Financial Analyst, a member of the Council of Chartered Financial Analysts
and is an associate of the Indian Institute of Bankers. He has been associated with our Bank since July 10, 1981 and
accordingly has about 34 years of experience in the field of banking. He is responsible for overseeing our credit risk
management. The total remuneration paid to him in Fiscal 2014 was ` 1.19 million.

Mr. Thomas K. George, 55 years, is the Deputy General Manager of Inspection Audit and Vigilance of our Bank.
He holds a bachelor’s degree in commerce from Kerala University. He has been associated with our Bank since
September 26, 1984 and accordingly has about 30 years of experience in the field of banking. He is responsible for
our practices related to fraud, vigilance and management of operational losses as well our inspections and audit
functions. The total remuneration paid to him in Fiscal 2014 ` 0.96 million.

Mr. P. V. Antony and Mr. Sijo Varghese are also ‘key managerial personnel’ within the meaning of Section 2(51) of
the Companies Act, 2013.

All our Key Management Personnel are permanent employees of our Bank.

Relationships among Key Management Personnel

None of our Key Management Personnel are related to each other.

Service Contracts

Apart from gratuity, pension and retirement benefits in terms of our Bank’s standard terms of employment, our Bank
has not entered into any service contract with any of the Key Management Personnel for provision of benefits or
payments of any amount upon termination of employment.

Shareholding of Key Management Personnel

For details of shareholding of our Key Management Personnel in our Bank and the stock options held by them
pursuant to the ESOS 2013, please see the section titled “Capital Structure – Shareholding of Directors and Key
Management Personnel” and “Capital Structure – Employee Stock Option and Stock Purchase Schemes” on pages
91 and 92.

Bonus or Profit Sharing Plan of the Key Management Personnel

Our Bank does not have a specific bonus or profit sharing plan for our Key Management Personnel. Our Key
Management Personnel may also be entitled to performance linked incentives as part of their remuneration.

Interests of Key Management Personnel

Other than to the extent of loans availed from our Bank, including housing loans, festival advances, overdraft
facilities, education loans (for dependents) and motor vehicle loans and to the extent of the remuneration or benefits
to which they are entitled to as per their terms of appointment, reimbursement of expenses incurred by them during
the ordinary course of business, the Key Management Personnel of our Bank do not have any other interest in our
Bank.

Except as described above, the Key Management Personnel of our Bank do not have any other interest in our Bank
other than to the extent of the remuneration or benefits to which they are entitled to as per their terms of
appointment, reimbursement of expenses incurred by them during the ordinary course of business.

Our Key Management Personnel may also be regarded as interested in the Equity Shares held by them or stock
options, if any, that may be granted to them under ESOS 2013 (including between the date of filing of this Draft Red

185
Herring Prospectus till listing and trading of the Equity Shares). Other than the above, none of the Key Management
Personnel has been paid any consideration or benefit of any nature from our Bank.

Changes in the Key Management Personnel

Changes in our Key Management Personnel, other than in relation to the post of our Managing Director and Chief
Executive Officer, in the last three years are as follows:

Name Date of change Reason

Mr. P. V. Antony March 12, 2014 Promoted to Chief Financial Officer
Mr. Mohan Menon T. March 12, 2014 Promoted to Chief Credit Officer*
Mr. Sekhar Rao March 3, 2014 Appointed as Head of Retail Distribution Strategy
Mr. Bharath Mani April 1, 2014 Appointed as Head of Retail Marketing and Product Management
Mr. Anand Krishnamurthy April 7, 2014 Appointed as Head of Wholesale Banking and Treasury
Mr. Kurian George April 12, 2014 Promoted to Business Head (Kerala)
Mr. Ajith Prabhakar March 12, 2014 Promoted to Business Head (Rest of India)
Mr. Jiz P. Kottukappaly March 12, 2014 Promotion to Chief Compliance Officer
Mr. Thomas K. George March 12, 2014 Promoted to Deputy General Manager (Inspection Audit and Vigilance)
Mr. M. P. Davies December 1, 2014 Promoted to Chief Credit Officer
Mr. Prem Kumar Thampi March 1, 2015 Appointed as Head of Strategy and Chief of Staff
* Designation changed to Head of Human Resources and Operations on January 10, 2015.

Employee Stock Options Scheme

For details of ESOS 2013, please see the section titled “Capital Structure – Employee Stock Option and Stock
Purchase Schemes” on page 92.

Arrangements and Understanding with Major Shareholders

Mr. K. Neethi Ragavan and Mr. V. G. Venkatachalapathy were appointed on our Board as nominees of the RBI in
exercise of its powers under Section 36AB(1) of the Banking Regulation Act. None of our other Directors or Key
Management Personnel have been appointed pursuant to any arrangement or understanding with our major
shareholders, customers, suppliers or others.

Payment of Benefit to Officers of our Bank (Non-Salary Related)

Except as stated in the sub-section titled “- Intersts of Key Management Personnel” on page 185, no amount of
benefit has been paid or given to any officer of our Bank within the two preceding years from the date of filing of
this Draft Red Herring Prospectus or is intended to be paid, other than in the ordinary course of their employment,
except for stock options, if any, granted under ESOS 2013.

Except statutory benefits upon termination of their employment in our Bank or superannuation, no officer of our
Bank is entitled to any benefit upon termination of such officer’s employment in our Bank or superannuation.

186
 OUR PROMOTER AND PROMOTER GROUP

Our Bank is a professionally managed company and does not have a promoter in terms of the SEBI Regulations and
the Companies Act, 2013. Consequently, it neither has a ‘promoter group’ nor any ‘group companies’ in terms of the
SEBI Regulations.

187
 RELATED PARTY TRANSACTIONS

For details on related party transactions of our Bank, see Annexure A-VII to our restated audited financial
statements, in the section titled “Financial Statements” beginning at page F-178.

188
 DIVIDEND POLICY

Our Bank does not have a formal dividend policy. The declaration and payment of dividends are governed by the
applicable provisions of the Companies Act, 2013, the Banking Regulation Act and the Articles of Association and
will depend on a number of other factors, including but not limited to the results of operations, financial condition,
restrictions imposed by RBI, capital adequacy ratio and other factors considered relevant by our Board.

Details of dividends declared by our Bank on the Equity Shares in each of Fiscals 2012, 2013 and 2014 as per our
audited financial statements are as given below.

Particulars Financial Performance

(For the Fiscal Year)
2012 2013 2014
Face value per Equity Share (in `) 10 10 10
Dividend (` in millions) 47.04* 62.77** 41.86
Dividend per Equity Share (in `) 1.50 1.50 1.00
Rate of dividend (%) 15.00 15.00 10.00
Dividend Tax (` in millions) 7.68 10.67 7.11
*
The bank has declared dividend @ 15% on the share capital for the year 2012. Before approval of financial results there had been
forfieture of shares and the proposed dividend has taken only after considering the forfeiture in the books of accounts.
**
A sum of ` 62.21 Million has been appropriated from the restated profit and loss account for the year ended on 31.03.2013. The dividend
appropriated is net of ` 0.56 million being the excess dividend proposed in the financial year 2011-12.

The amount paid as dividends in the past is not necessarily indicative of the dividend policy or dividend amount, if
any, in the future.

We may retain all our future earnings, if any, for use in the operations. As a result, we may not declare dividends in
the foreseeable future. Any future determination as to the declaration and payment of dividends will be at the
discretion of our Board and will depend on factors that our Board deem relevant, including among others, our results
of operations, financial condition, restrictions imposed by RBI, cash requirements, business prospects and any other
financing arrangements. Further, there are regulatory restrictions on banks with respect to payment of dividend. For
details, please see “Risk Factors - Our ability to pay dividends is restricted” on page 35.

In terms of the debenture trust deed executed by our Bank in favour of Indian Overseas Bank, the trustee for the
holders of the CSBL Bonds 2012, our Bank cannot, without prior consent of trustee declare dividends in any
financial year unless it has paid all dues to the holders of the CSBL Bonds 2012, or made satisfactory provisions
thereof.

189
 SECTION V – FINANCIAL INFORMATION

FINANCIAL STATEMENTS

S no. Particulars Page no.

1. Independent Auditor’s Report on Restated Financial Information F-1

2. Summary Satements of Assets & Liabilities as Restated F-5
3. Summary Statement of Restated Profit & Loss F-7
4. Statement of Cash Flows as Restated F-10

190
 INDEPENDENT AUDITORS’ REPORT ON RESTATED FINANCIAL INFORMATION

To

The Board of Directors,

The Catholic Syrian Bank Limited
CSB Bhavan
St. Mary’s College Road
Post Box No. 502
Thrissur - 680 020

We have been engaged to examine and report on the Restated Financial Information of The
Catholic Syrian Bank Limited (the “Bank”), which have been prepared in accordance with the
Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009, as amended (“SEBI ICDR Regulations”) issued by the Securities and
Exchange Board of India (“SEBI”).

The Bank proposes to undertake fresh issue of equity shares at such premium, arrived at by book
building process, as may be decided by the Board of Directors of the Bank.

The preparation and presentation of this Restated Financial Information is the responsibility of
Bank. We have examined and reported on the above statements on the basis of information and
explanations provided by the management, books and records produced to us, so as to obtain a
reasonable assurance that such statements are free of material misstatements.

We have examined the attached Restated Financial Statements of the Bank as at March 31, 2010,
March 31, 2011, March 31, 2012, March 31, 2013, March 31, 2014 and six months ended
September 30, 2014 prepared for the purpose of inclusion in the Draft Red Herring Prospectus
(“Restated Financial Information”), in connection with the proposed Issue of equity shares.
Such financial information has been approved by the Board of Directors of the Bank and prepared
by the Bank in accordance with the requirements of:

a. Sub-clause (i), (ii) and (iii) of clause (b) of Sub-section (1) of Section 26 of Chapter III of the
Companies Act, 2013 (the “Companies Act”) read with rule 4 of Companies (Prospectus and
Allotment of Securities) Rules, 2014; and

b. relevant provisions of the SEBI ICDR Regulations.

We have examined such Restated Financial Information taking into consideration:

a. the terms of our engagement agreed with you vide our engagement letter dated 22.01.2015,
requesting us to carry out work on such financial information, proposed to be included in the
Draft Red Herring Prospectus of the Bank in connection with the Issue; and

b. the Guidance Note on Reports in Company Prospectuses (Revised) issued by the Institute of
Chartered Accountants of India.

For our examination, we have placed reliance on the financial statements which comprises the
audited balance sheets as at March 31, 2010, March 31, 2011 and March 31, 2012 and the related
statement of profit and loss and the cash flow statements including summary of significant
accounting policies for each of the financial years ended March 31, 2010, March 31, 2011, March
31, 2012 prepared in accordance with Indian Generally Accepted Accounting Principles, the
Banking Regulation Act, 1949 and the Companies Act 1956 jointly audited by M/s. Essveeyar,
Chartered Accountants, Chennai and M/s. Abraham & Jose, Chartered Accountants, Thrissur. The

F-1
 1

restated financial information for the above years are based solely on the report submitted by
them.

The Restated Financial Information, expressed in Indian Rupees, in Millions, has been derived
from the audited financial statements of the Bank, as at and for the financial years ended March
31, 2010, March 31, 2011, March 31, 2012, March 31, 2013, March 31, 2014 and six months
ended September 30, 2014, all of which were expressed in Indian Rupees.

We report that the profit / loss of the Bank as restated for the financial years ended March 31,
2010, March 31,2011, March 31,2012, March 31,2013, March 31,2014 and six months ended
September 30, 2014 are as set out in Annexure A. These profit / loss have been arrived at after
making such adjustments and regroupings as in our opinion are appropriate and more fully
described in significant accounting policies and notes thereon.

We report that the assets and liabilities of the Bank as restated as at March 31, 2010, March 31,
2011, March 31, 2012, March 31, 2013, March 31, 2014 and September 30, 2014 are also as set
out in Annexure A after making such adjustments and regroupings as in our opinion are
appropriate and more fully described in significant accounting policies and notes thereon.

The Annexure A as referred to in paragraphs above consists of the following:

(a) Summary statement of Assets and Liabilities as restated (Annexure A-I).

(b) Summary statement of Restated Profit and Loss Account (Annexure A-II).
(c) Statement of Cash Flows as restated (Annexure A-III).
(d) Significant Accounting Policies and Notes to Accounts Restated for Financial Years
ended March 31, 2010, March 31, 2011, March 31, 2012, March 31, 2013, March 31,
2014 and six months ended September 30, 2014 (Annexure A-IV).
(e) Notes to adjustments carried out in the Statement of Profit and Loss and Balance
Sheet (Annexure A-V).
(f) Adjustments not carried out in the Statements of Restated Profit and Loss and Assets
and Liabilities (Annexure A-VI).
(g) Summary of significant transaction with Related Parties for the Financial Years ended
March 31, 2010, March 31, 2011, March 31, 2012, March 31, 2013, March 31, 2014
and six months ended September 30, 2014 (Annexure A-VII).
(h) Segment Reporting for the Financial Years ended March 31, 2010, March 31, 2011,
March 31, 2012, March 31, 2013, March 31, 2014 and six months ended September
30, 2014 (Annexure A-VIII).
(i) Statement of Advances (Annexure A-IX).
(j) Statement of Investments (Annexure A-X).

We report that the dividends declared by the Bank for Financial Year ended March 31, 2010,
March 31,2011, March 31,2012, March 31,2013, March 31, 2014 and six months ended
September 30, 2014 are as set out in Annexure B.

We report that the Bank does not have any subsidiary or joint venture or associates.

There are no extraordinary items which need to be disclosed separately in the attached Restated
Summary Statementsp

We have also examined the following financial information relating to the Bank proposed to be
included in the offer documents, as prepared by the management and approved by the Board of
Directors of the Bank for the Financial Years ended March 31, 2010, March 31, 2011, March 31,
2012, March 31, 2013, March 31, 2014 and six months ended September 30, 2014and annexed to

F-2
this report. In respect of the financial years ended March 31, 2010, March 31, 2011 and March 31,
2012 these information have been included based upon the reports submitted by previous auditors
M/s. Essveeyar, Chartered Accountants, Chennai and M/s. Abraham & Jose, Chartered
Accountants, Thrissur and relied upon by us.

(i) Summary of accounting ratios as restated as set out in Annexure C.

(ii) Capitalization Statement as restated as set out in Annexure D.
(iii) Statement of Tax Shelter as set out in Annexure E.
(iv) Statement of Borrowings as set out in Annexure F.
(v) Key Financial Indicators as set out in Annexure G.
(vi) Statement of Cash and Balances with RBI as set out in Annexure H.
(vii) Statement of Balance with Bank and Money at Call and Short Notice as set out in
Annexure I.
(viii) Statement of Fixed Assets as set out in Annexure J.
(ix) Statement of Other Assets as set out in Annexure K.
(x) Statement of Deposits as set out in Annexure L.
(xi) Statement of Other Liabilities and Provisions as set out in Annexure M.
(xii) Statement of Share Capital as set out in Annexure N.
(xiii) Statement of Reserves and Surplus as set out in Annexure O.
(xiv) Statement of Contingent Liabilities as set out in Annexure P.
(xv) Statement of Capital Adequacy as set out in Annexure Q.
(xvi) Statement of Non Performing Assets as set out in Annexure R.
(xvii) Statement of Other Income which exceeds 20% of NPBT as set out in Annexure S.

In our opinion, the Restated Financial Information of the Bank as stated in Annexure A-I to A-X
above, read along with the respective Significant Accounting Policies and notes thereon, prepared
after making regroupings and adjustments as were considered appropriate by us, have been
prepared in accordance with the SEBI ICDR Regulations.

Emphasis of Matter

Without qualifying our opinion, we draw attention to Note No. 8.3.2 to the restated financial
statements for the year ended 31.03.2011 and 3.3 to the restated financial statements for the years
ended 31.03.2012, 31.03.2013, 31.03.2014 and 30.09.2014, which describes deferment of pension
and gratuity liability of the bank to the extent of Rs 483.80 million, Rs. 362.80 million, Rs. 241.90
million and Rs. 121 million for the years ended 31.03.2011, 31.03.2012, 31.03.2013 and
31.03.2014 respectively and Rs. 60.50 million for the period ended 30.09.2014 pursuant to the
exemption granted by the Reserve Bank of India to the bank, from the application of the
provisions of Accounting Standard (AS) 15 relating to employee benefits vide its circular no.
DBOD.BP BC 80/21.04.018/2010-11 dated 09.02.2011 and RBI letter DBOD.BP BC
15896/21.04.018/2010-11 dated 08.04.2011 on reopening of pension option to employees of the
bank and enhancement in gratuity limits Prudential Regulatory Treatment.

This report is intended solely for your information and for inclusion in the offer document in
connection with the proposed Issue of the Bank and is not to be used, referred to or distributed for
any other purpose without our prior written consent.

F-3
 This report should neither in any way be construed as a reissuance or redrafting of any of the
previous audit reports issued by us or by other firms of chartered accountants nor construed as a
new opinion on any financial statements referred to herein.

For Sundaram & Srinivasan For Varma & Varma

Chartered Accountants Chartered Accountants
Firm Registration No: 004207S Firm Registration No: 004532S

C. Naresh C Pankajakshan
Partner Partner
M No. 028684 M No. 012948
Place: Thrissur Place: Thrissur
Date:30.03.2015 Date:30.03.2015

F-4
 THE CATHOLIC SYRIAN BANK LTD
SUMMARY OF FINANCIAL INFORMATION
Annexure A-I
Summary Statement of Assets & Liabilities as Restated
(` in Million)

Half Year
FINANCIAL YEAR ENDED 31ST MARCH
S. NO. PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
A. ASSETS
1 Cash in Hand 548.37 597.37 661.02 846.80 720.21 904.26
2 Balance with RBI 5,308.00 5,274.04 6,203.74 5,445.78 5,518.82 5,394.86
3 Balance with Banks
In India 283.78 725.90 2,436.23 3,972.86 3,637.86 327.81
Outside India 416.20 403.58 409.12 384.75 866.13 998.84
Money at Call & Short
4
Notice 499.67 - - - - -
5 Investments
Gross Investment In India 22,920.66 26,930.69 31,474.46 33,046.20 51,397.84 51,388.51
Less: Provision for NPA
Investment - - - - - -
Less: Depreciation on
Investment 26.55 28.11 23.00 35.68 81.31 58.60
Net Investment In India 22,894.11 26,902.58 31,451.46 33,010.52 51,316.53 51,329.91
Outside India - - - - - -
6 Advances
In India 44,669.38 62,200.25 76,635.43 88,515.18 87,073.62 94,303.03
Outside India - - - - - -
7 Fixed Assets 793.98 753.03 758.78 1,694.58 1,736.45 1,720.95
Less: Revaluation Reserve 401.53 395.12 387.66 1,267.12 1,253.11 1,246.45
Net Fixed Assets 392.45 357.91 371.12 427.46 483.34 474.50
8 Other Assets 1,531.09 1,445.82 1,925.91 2,353.01 2,287.90 2,463.89
Less: Deferred Tax and
Intangible Assets 417.18 310.81 339.96 470.02 250.59 702.82
Net Other Assets 1,113.91 1,135.01 1,585.95 1,882.99 2,037.31 1,761.07
TOTAL (A) 76,125.87 97,596.64 119,754.07 134,486.34 151,653.82 155,494.28

B. LIABILITIES
1 DEPOSITS
Demand Deposit
From Banks 6.05 12.19 14.49 3.88 5.32 2.51
From Others 2,914.83 3,256.80 3,464.10 3,289.67 3,309.13 3,892.52
2 Saving Deposits 14,605.94 16,242.46 17,004.97 18,340.40 20,295.38 21,553.38
3 Term Deposits from Banks 1,671.39 2,804.42 4,213.90 4,594.61 4,989.09 3,681.08
Term Deposits from others 50,585.29 64,940.82 81,351.24 97,187.70 108,139.69 112,525.53
4 Borrowings
In India 0.73 2,321.19 4,419.65 819.06 4,480.43 4,752.95
Outside India - - - - - -
Subordinate Debts(Tier-II
Bonds) 928.00 917.00 1,335.00 1,175.00 1,075.00 575.00
5
Other Liabilities & Provisions 2,391.65 2,336.70 3,000.98 3,276.28 3,161.18 2,951.96
TOTAL (B) 73,103.88 92,831.58 114,804.33 128,686.60 145,455.22 149,934.93

C. NET WORTH (A-B) 3,021.99 4,765.06 4,949.74 5,799.74 6,198.60 5,559.35

F-5
 Annexure A-I (Continued)

Summary Statement of Assets & Liabilities as Restated

(` in Million)
Half Year
S. FINANCIAL YEAR ENDED 31ST MARCH
PARTICULARS Ended
NO.
2010 2011 2012 2013 2014 30.09.2014
D. Share Capital 189.26 313.48 314.16 418.99 418.99 418.99
Equity Share Capital 189.26 313.48 314.16 418.99 418.99 418.99

E. RESERVE & SURPLUS

1 Statutory Reserve 1,219.61 1,250.05 1,314.81 1,396.47 1,463.67 1,463.67
2 Capital Reserve 305.08 311.19 315.65 397.06 529.69 529.69
3 Revaluation Reserve 401.53 395.12 387.66 1,267.12 1,253.11 1,246.45
4 Share Premium 868.05 2,217.81 2,224.42 2,906.66 2,906.66 2,906.66
5 Revenue & Other Reserve 914.69 962.89 1,098.79 1,189.20 1,108.44 1,108.44
6 Balance of Profit & Loss
Account - 20.45 21.87 - 21.74 -
TOTAL 3,708.96 5,157.51 5,363.20 7,156.51 7,283.31 7,254.91
Less: Revaluation Reserve 401.53 395.12 387.66 1,267.12 1,253.11 1,246.45
Less: Deferred Tax and
Intangible Assets 417.18 310.81 339.96 470.02 250.59 702.82
Less: Profit & Loss (Dr.) 57.52 - - 38.62 - 165.28
TOTAL (E) 2,832.73 4,451.58 4,635.58 5,380.75 5,779.61 5,140.36
NET WORTH (D+E) 3,021.99 4,765.06 4,949.74 5,799.74 6,198.60 5,559.35

The summary statement of assets and liabilities as restated should be read along with the significant
accounting policy and notes on accounts.

For Sundaram & Srinivasan For Varma & Varma

Chartered Accountants
Chartered Accountants Firm Registration No: 004532S
Firm Registration No: 004207S

C. Naresh C. Pankajakshan
M.No. 28684 M.No.012948

Place: Thrissur

Date: 30.03.2015

F-6
 Annexure A-II

Summary Statement of Restated Profit & Loss Account

(` in Million)
Half Year
Financial Year ended 31st March
S No. Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
A. INCOME
1 Interest Earned 5,779.56 7,621.32 10,756.34 13,208.64 15,039.78 7,692.34
1.1 Interest & Discount on advance/bills 4,171.31 6,007.41 8,615.04 10,743.45 11,386.97 5,762.99
1.2 Income on Investment 1,413.12 1,553.24 2,008.63 2,262.59 3,304.09 1,862.06
Interest on balance with RBI & other
1.3
Inter Bank Funds 146.75 49.76 74.27 201.21 319.84 61.81
1.4 Interest on Others 48.38 10.91 58.40 1.39 28.88 5.48
2 OTHER INCOME 739.46 744.41 851.61 945.66 1,173.18 470.40
Commission, Exchange &
2.1
Brokerage 200.28 166.26 173.03 162.60 166.93 94.70
2.2 Profit on sale of Investments(Net) 128.53 52.14 52.78 228.88 440.97 82.13
Profit on sale of land, building &
2.3
other assets (Net) (0.29) 5.33 12.27 4.57 0.88 (1.62)
2.4 Profit on exchange transaction(Net) 64.00 97.56 113.81 130.73 125.35 71.96
2.5 Miscellaneous Income 346.94 423.12 499.72 418.88 439.05 223.23
TOTAL INCOME 6,519.02 8,365.73 11,607.95 14,154.30 16,212.96 8,162.74
B. EXPENDITURE
1 Interest Expended 4,551.55 5,139.79 7,686.09 9,816.48 11,247.74 5,854.00
1.1 Interest on Deposits 4,460.44 4,963.09 7,380.10 9,502.27 10,942.40 5,661.42
Interest on RBI/Inter Bank
1.2
borrowings 0.33 31.74 65.93 73.43 115.32 111.83
1.3 Others 90.78 144.96 240.06 240.78 190.02 80.75
2 Operating Expenses 2,080.66 2,771.76 2,984.73 3,409.52 3,950.24 2,042.53
Payment to & provision for
2.1
employees 1,348.59 1,993.79 2,120.87 2,430.90 2,816.73 1,419.21
2.2 Rent, Tax & Lighting 214.47 230.11 255.06 323.41 383.84 202.81
2.3 Printing & Stationery 21.18 24.76 29.02 32.96 36.98 16.67
2.4 Advertisement & Publicity 7.66 13.14 24.28 18.11 10.77 5.25
Depreciation on Banks Properties
2.5 (net of amounts adjusted against
revaluation reserve) 107.71 104.25 85.37 74.40 73.47 53.13
Director's fees, allowances and
2.6
expenses 3.73 4.22 4.81 8.07 7.14 5.21
2.7 Auditor's Fees & Expenses 7.61 9.22 10.71 17.02 16.70 9.11
2.8 Law Charges 8.68 7.97 7.18 7.13 8.37 3.88
Postage, Telegrams, Telephones
2.9
etc. 48.37 46.45 49.28 54.81 62.45 36.63
2.1 Repairs & Maintenance 50.82 58.79 59.15 60.10 61.15 34.96
2.11 Insurance 66.69 74.59 93.25 100.06 128.61 68.59
2.12 Other Expenditure 195.15 204.47 245.75 282.55 344.03 187.08
TOTAL EXPENDITURE 6,632.21 7,911.55 10,670.82 13,226.00 15,197.98 7,896.53
Operating Profit (before Extra
C. Ordinary Items and Provision &
Contingencies) Refer Anx A II (i) (113.19) 454.18 937.13 928.30 1,014.98 266.21

F-7
 Summary Statement of Restated Profit & Loss Account Annexure A-II (Continued)
(`in Million)
Half Year
Financial Year ended 31st March
S No. Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Add/(less): Extra Ordinary Items
net of taxes - - - - - -
Less: Provisions & Contingencies
(other than Provision for Tax) 84.66 161.58 640.09 600.84 546.00 542.33
D. Profit(Loss) Before Tax (197.85) 292.60 297.04 327.46 468.98 (276.12)
Provision for Tax (135.97) 92.87 36.60 61.29 159.52 (94.65)
E. Net Profit after tax, as restated (61.88) 199.73 260.44 266.17 309.46 (181.47)
Adjustment for Profit/ (Loss)
Brought Forward 21.01 (57.52) 20.45 21.87 (38.62) 21.74
Profit / (Loss) available for
F.
appropriation (40.87) 142.21 280.89 288.04 270.84 (159.73)
a) Statutory Reserve 4.13 30.44 64.76 81.67 67.20 -
b) Capital Reserve 3.61 6.11 4.46 81.40 132.63 -
c) General Reserve 0.60 11.59 76.63 13.23 15.78 -
d) Revenue & Other Reserve 8.16 36.62 57.81 77.18 (15.78) -
e) Charity Fund 0.15 0.30 0.30 0.30 0.30 -
f) Deferred Tax Liability - - - - - -
g) Dividend (excluding dividend tax) - 31.58 47.38 62.21 41.86 -
h) Tax on Dividend - 5.12 7.68 10.67 7.11 -
Adjustment of Depreciation as per
i)
Companies Act,2013 - - - - - 5.55
j) Balance of Profit carried forward (57.52) 20.45 21.87 (38.62) 21.74 (165.28)
TOTAL (40.87) 142.21 280.89 288.04 270.84 (159.73)

The summary statement of restated profit and loss account should be read along with the significant accounting
policy and notes on accounts.

For Sundaram & Srinivasan For Varma & Varma

Chartered Accountants
Chartered Accountants Firm Registration No: 004532S
Firm Registration No: 004207S

C. Naresh C. Pankajakshan
M.No. 28684 M.No.012948

Place: Thrissur

Date: 30.03.2015

F-8
 Annexure A II (i)

(` in Million)

Half Year
S Financial Year ended 31st March
Particulars Ended
No.
2010 2011 2012 2013 2014 30.09.2014
Break up of Provisions and
Contingencies
1 Provision for Non-Performing Advances
including Write Off 90.51 134.16 459.80 391.82 596.09 571.36
Add back of eligible amount of
2 provision held in respect of Agricultural
Debts Waived (1.47) (4.62) - - - -
Depreciation on Investments/(Written
3
Back) (14.59) 1.56 (5.12) 12.69 45.63 (22.71)
4 Provision for standard Advances - 36.86 109.04 126.69 (35.80) (1.95)
5 Provision for Diminution in
Restructured Advances 18.20 (4.80) 63.85 73.41 (66.02) (2.04)
6 Others (7.99) (1.58) 12.52 (3.77) 6.10 (2.33)
Provision for Contingencies (other
than Provision for tax) 84.66 161.58 640.09 600.84 546.00 542.33
Provision for Income Tax (135.97) 92.87 36.60 61.29 159.52 (94.65)
TOTAL (51.31) 254.45 676.69 662.13 705.52 447.68

F-9
 Annexure A-III
Statement of Cash Flows as Restated
(` in Million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
Ended
PARTICULARS

2010 2011 2012 2013 2014 30.09.2014

A. CASH FLOW FROM OPERATING
ACTIVITIES
Net Profit / (Loss) before Tax (197.85) 292.60 297.04 327.46 468.98 (276.12)
Adjustments for:
Depreciation on Fixed Assets 86.03 81.50 63.20 53.12 59.13 45.26
Amortisation of Intangible Assets 21.69 22.76 22.18 21.28 14.34 7.87

Provisions and Contingencies 84.66 161.58 640.09 600.84 546.00 542.33

Interest on Tier II Bonds 76.00 74.75 74.60 111.03 110.67 35.12
Others 154.20 56.55 23.73 71.29 (32.03) 2.72
Operating Profit before working capital
changes 224.73 689.74 1,120.84 1,185.02 1,167.09 357.18

Adjustments for
Deposits 6,455.22 17,473.19 18,792.01 17,367.55 13,322.36 4,916.41

Borrowings (0.55) 2,320.46 2,098.46 (3,600.59) 3,661.37 272.52

Other Liabilities 23.97 (177.57) 490.07 63.06 (29.54) (199.14)

Investments (1,039.83) (4,010.03) (4,543.77) (1,571.74) (18,351.64) 9.32

Advances (7,939.61) (17,660.29) (14,958.81) (12,345.00) 911.48 (8,217.02)

Other Assets 43.01 (64.32) (381.95) (503.09) (50.62) 208.36

Cash (used in) / generated from Operating
Activities (2,233.06) (1,428.82) 2,616.85 595.21 630.50 (2,652.37)

Direct Taxes Paid (Net of refunds) (25.36) 37.15 (146.94) 8.88 (95.97) 174.36
Net Cash (used in) / generated from
Operating Activities (A) (2,258.42) (1,391.67) 2,469.91 604.09 534.53 (2,478.01)
B. CASH FLOW FROM INVESTING
ACTIVITIES
Purchase of Fixed Assets and Intangible
Assets (66.90) (55.32) (91.13) (127.85) (159.96) (56.21)
Sale of Fixed Assets 1.70 3.64 16.43 2.29 2.38 1.05
Net Cash used in Investing Activities
(B) (65.20) (51.68) (74.70) (125.56) (157.58) (55.16)

F-10
 Annexure A-III (Continued)
Statement of Cash Flows as Restated
(` in Million)

C. CASH FLOW FROM FINANCING

ACTIVITIES
Proceeds from issue of Equity Share
Capital 0.47 124.22 0.68 104.83 - -
Proceeds from Share Premium 5.07 1,349.76 6.61 682.24 - -
Issue / (Redemption) of Tier II Bonds - (11.00) 418.00 (160.00) (100.01) (500.00)
Interest Paid on Tier II Bonds (76.00) (74.75) (74.60) (111.03) (110.67) (35.12)
Dividend paid (including Tax on Dividend
) (25.77) - (36.70) (54.49) (73.44) (48.96)
Net Cash generated / (used in) financing
activities (C) (96.23) 1,388.23 313.99 461.55 (284.12) (584.08)
D. NET INCREASE / (DECREASE) IN
CASH AND CASH EQUIVALENTS
(A+B+C) (2,419.85) (55.12) 2,709.20 940.08 92.83 (3,117.25)
Cash and Cash Equivalents at the
beginning of the Year 9,475.87 7,056.02 7,000.90 9,710.10 10,650.18 10,743.01
Cash and Cash Equivalents at the end of
the Year 7,056.02 7,000.90 9,710.10 10,650.18 10,743.01 7,625.76
Net increase / (decrease) disclosed as
above (2,419.85) (55.12) 2,709.20 940.08 92.83 (3,117.25)

The statement of cash flows as restated should be read along with the significant accounting policy and notes
on accounts.

For Sundaram & Srinivasan For Varma & Varma

Chartered Accountants
Chartered Accountants Firm Registration No: 004532S
Firm Registration No: 004207S

C. Naresh C. Pankajakshan
M.No. 28684 M.No.012948

Place: Thrissur

Date: 30.03.2015

F-11
 Annexure A-IV

• SIGNIFICANT ACCOUNTING POLICIES

• NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2009-10

• NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2010-11

• NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2011-12

• NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2012-13

• NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2013-14

• NOTES ON ACCOUNTS FOR THE HALF YEAR ENDING 30.09.2014

F-12
 ANNEXURE A-IV
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. GENERAL

a) The financial statements have been prepared in accordance with the requirements prescribed under the Third
Schedule (Form A and Form B) of the Banking Regulation Act, 1949. The accounting and reporting policies of the
Bank used in the preparation of these financial statements confirm to Generally Accepted Accounting Principles in
India (Indian GAAP), the guidelines issued by the Reserve Bank of India (RBI) from time to time, the Accounting
Standards (AS) issued by the Institute of Chartered Accountants of India and referred to in the Companies Act,
2013 so far as they apply to the Bank and practices generally prevalent in the banking industry in India.

b) Historical cost convention and Accrual basis of accounting have been consistently applied while preparing and
presenting the financial statements, unless otherwise stated.

2. USE OF ESTIMATES

The preparation of the financial statements, in conformity with generally accepted accounting principles, requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and
expenses and disclosures of contingent liabilities at the date of the financial statements. Management believes that the
estimates used in the preparation of the financial statements are prudent and reasonable. Future results could differ from
these estimates. Any revision to accounting estimates is recognized prospectively in current and future periods.

3. TRANSACTIONS INVOLVING FOREIGN EXCHANGE

a) Monetary assets and liabilities including contingent liabilities have been translated at the exchange rates prevailing
at the close of the half year as advised by FEDAI and the effect is accounted in Profit & Loss Account.

b) Income and Expenditure items denominated in foreign currencies have been accounted at the exchange rates
prevailing on the date of transaction.

c) Outstanding foreign exchange forward contracts are revalued at the rates applicable on the closing date as advised
by FEDAI. The resultant profit/loss is taken into Profit and Loss Account.

d) Contingent Liabilities on guarantees, letters of credit, acceptances and endorsements are reported at the exchange
rates prevailing at the close of the half year.

4. INVESTMENTS

a) Accounting and classification

All Investments are accounted for on settlement dates.In terms of RBI guidelines, the entire investments portfolio
has been classified under three categories for valuation purpose, viz., “Held to Maturity”, “Available for sale” and
“Held for Trading” at the time of its purchase. However, for disclosure in the Balance Sheet, investments are
classified under six groups – Govt. Securities, Other Approved Securities, Shares, Debentures and Bonds,
Subsidiaries/Joint Venture and Others.

b) Cost of acquisition

Costs such as brokerage pertaining to investments, paid at the time of acquisition are charged to the profit and loss
account.

c) Basis of Classification

Securities that are held principally for resale within 90 days from the date of purchase are classified under the
HFT category. Investments that the bank intends to hold till maturity are classified under the HTM category.
Securities which are not classified in the above categories are classified under the AFS category.

F-13
 d) Transfer between categories

Reclassification of investments from one category to the other, if done, is in accordance with the RBI guidelines.
Transfer of scrips from AFS/HFT category to HTM category is made at the lower of book value or market value.
In the case of transfer of securities from HTM to AFS/HFT category, the investments held under HTM at a
discount are transferred to AFS/HFT category at the acquisition price and investments placed in the HTM
category at a premium are transferred to AFS/HFT at the amortized cost.
Transfer of investments from AFS to HFT or vice versa is done at the book value. Depreciation carried, if any, on
such investments is also transferred from one category to another.

e) Valuation of Securities:

i) Investments in “Held to Maturity” category are accounted for at acquisition cost or at amortised cost, if
acquired at a premium. In case the cost is higher than the face value, the premium is amortised over the period
remaining to maturity using Constant Yield Method. Such amortisation of premium is adjusted against income
under the head “Income on Investments”. Where the face value is higher than the cost, the discount is ignored
and is accounted only on maturity date of the instrument.

ii) Securities classified as “Available for Sale” are marked to market scrip-wise on a quarterly basis and net
depreciation in each category is provided for, while net appreciation is ignored.

iii) Individual scrips in “Held for Trading” category are marked to market at daily intervals and net depreciation in
each category is provided for, while net appreciation is ignored.

iv) Treasury Bills and Certificate of Deposits are valued at carrying cost.

v) Security receipts are valued as per the Net Asset Value (NAV) obtained from the issuing Reconstruction
Company/Securitisation Company.

vi) Profit on sale of investments in ‘Held to Maturity’ category is recognised in the Profit and Loss Account and
an equivalent amount net of taxes and transfer to Statutory Reserves is appropriated to Capital Reserve.

vii) Investments are also classified as Performing and Non Performing as per the guidelines of RBI and provisions
on Non Performing investments are made as per the provisioning norms of RBI.

5. ADVANCES

a) Advances are classified as Performing and Non Performing based on the relevant RBI guidelines. The amount of
advances shown in the Balance Sheet is net off provisions and interest suspense.
b) Provision on Standard Assets is maintained as per RBI guidelines and the same is included in Other Liabilities &
Provisions.

c) Amounts recovered against debts written off in earlier years are recognised as revenue.

d) The sale of financial assets (including Non Performing Advances) to Reconstruction Company (RC)/ Securitisation
Company (SC) are accounted as per the extant guidelines of Reserve Bank of India from time to time.

e) Policy on Managing Currency induced credit risk: As per Credit Policy of the bank Forward exchange cover is
insisted on all Foreign Currency loans of USD 0.25 Mio or above unless there is natural hedge by way of
export/other earnings. For foreign currency loans of less than USD 0.25 Mio, forward exchange cover is optional to
the borrower subject to furnishing of an unconditional undertaking to bear the exchange loss if any.

6. FIXED ASSETS AND DEPRECIATION

a) Fixed Assets other than premises are carried at cost less accumulated depreciation. Cost includes cost of purchase
and all directly attributable costs of bringing the asset to its working condition for its intended use.

F-14
 b) Premises are stated at revalued amount. Appreciation on revaluation of premises is credited to Revaluation
Reserve. The additional depreciation on the revalued portion of buildings is charged to Profit and Loss account
and an equivalent withdrawal is made from Revaluation Reserve Account.

c) Subsequent expenditure incurred on fixed assets put to use is capitalized only when it represents an improvement
which increases the future benefits from the existing asset beyond its previously assessed standard of performance
or an extension which becomes an integral part of the asset.

d) Depreciation on additions to fixed assets is provided on pro rata basis.

e) The useful life for computation of depreciation for various categories of Fixed Assets are as follows

Type of Fixed Asset Useful Life (Yrs) Depreciation Method

Building 58 Yrs Written Down Value
Motorcars 8 Yrs Straight Line
Furniture & Fixtures 10 Yrs Straight Line
Plant & Machinery 15 Yrs Straight Line
Servers & Networks 6 Yrs Straight Line
Other Computer Hardware 3 Yrs Straight Line
ATMs 8 Yrs Straight Line

7. INTANGIBLE ASSETS

Accounting and amortisation of Computer Software are in accordance with the provisions of Accounting Standard 26
– Intangible Assets, issued by Institute of Chartered Accountants of India (ICAI).

a) Application Software purchased is amortised over a period of 5 years on pro rata basis under Straight Line
Method.

b) Internally Generated Application Software is accounted as an intangible asset and is amortised over a period of 5
years on pro rata basis under Straight Line Method from the date the software becomes Available for Use. If the
software is still in the development phase and has not become Available for Use, no amortisation is charged to
Profit & Loss Account.

8 . NON BANKING ASSETS

In the case of Non Banking Assets, diminution in value, if any, is provided for.

9. EMPLOYEE BENEFITS

9.1 Short Term Employee Benefits

The undiscounted amount of short-term employee benefits which are expected to be paid in exchange for the services
rendered by employees are recognised during the period when the employee renders the service.

9.2 Long term Employee Benefits

a) Defined Contribution Plan

Provident Fund and New Pension Scheme (Contributory) are the defined contribution plans of the bank. In addition to
contribution for the period, shortfall, if any, in the Income and Expenditure account of the Provident Fund is charged to
Profit and Loss Account of the bank.

b) Defined Benefit Plans

F-15
 Liabilities towards Gratuity, Pension and Leave benefits to employees are defined benefit obligations and are provided
for on the basis of actuarial valuation made at the end of each financial year. Projected Unit Credit Method is used by
the actuary for valuing the obligations in case of Pension, Gratuity and Long term Compensated Absences and other
long term employee benefits. Discount rate used to arrive at the present value of estimated future cash flows is arrived
at by reference to market yields on balance sheet date on government bonds of term consistent with estimated term of
the obligations as per para 78 of AS 15 Employee Benefits. Actuarial Gains/Losses are immediately taken to the profit
and loss account and are not deferred.

Brief description of the defined benefit plans:

i) Pension - Pension is payable to the employees who have specifically opted for the same. For becoming eligible for
pension, the employee should have served the bank for a minimum period of 10 years in the case of retirement on
superannuation and 20 years in other cases. At the time of retirement or death of the pension eligible employee,
the pension trust purchases annuity from insurance company, out of the contributions made by the bank.

ii) Gratuity - Gratuity is payable to all employees on termination of employment due to retirement, death or
resignation, provided that the employee has served the bank for a minimum period of 5 years.

The net liability arising out of reopening of pension option to employees and enhancement in gratuity limits is
amortised in 5 years commencing from 2010-11as per approval of RBI (vide the RBI Circular DBOD.No. BP.
BC.80/21.04.018/2010-11 dated February 9, 2011 and RBI letter DBOD.No.BP.BC.15896/21.04.018/2010-11
dated April 08, 2011)

iii) Long term compensated absences and other long term employee benefits.

a. Privilege Leave
b. Sick leave on half pay
c. Carry forward of unavailed casual leave
d. Leave fare concession

10. RECOGNITION OF REVENUE AND EXPENDITURE

Revenue is recognised to the extent it is probable that the economic benefits will flow to the bank and the revenue can be
reliably measured.

a. Interest/discount on advances/bills is recognised on accrual basis except on non-performing assets in which case
the income is recognised as per prudential norms issued by RBI.

b. Exchange, Brokerage, Commission & Rent on lockers are recognised on cash basis.

c. Income on Investments (other than dividend on equity shares & mutual funds and income on non performing
investments) is recognised on accrual basis. Dividend income is recognised on cash basis.

d. Recovery in Non Performing Assets is first appropriated towards interest and the balance, if any, towards principal,
except in the case of Suit Filed Accounts, sale to Asset Reconstruction Companies and accounts under One Time
Settlement.

e. Legal expenses incurred on suit filed accounts are expensed in profit and loss account as per RBI guidelines. Such
amount when recovered is treated as income.

11. TAXES ON INCOME

Income tax expense is the aggregate amount of current tax and deferred tax charge. Current year taxes are determined in
accordance with the Income Tax Act, 1961. Deferred income taxes reflect the impact of current year timing differences
between taxable income and accounting income for the year and reversal of timing differences of earlier years.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the Balance Sheet
date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current tax
assets against current tax liabilities and the deferred tax assets and deferred tax liabilities relate to the taxes on income
levied by same governing taxation laws. Deferred tax assets are recognized only to the extent that there is a reasonable

F-16
 certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized.
The impact of changes in the deferred tax assets and liabilities is recognized in the Profit and Loss Account.

Deferred tax assets are recognized and reassessed at each reporting date, based upon the Management’s judgement as to
whether realisation is considered as reasonably certain. Deferred tax assets are recognized on carry forward of
unabsorbed depreciation and tax losses only if there is virtual certainty that such deferred tax asset can be realized
against future profits.

12. SEGMENT INFORMATION

Bank has adopted RBI’s revised guidelines on segment reporting issued in April 2007 and accordingly 4 business segments
viz. Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking Operations have been considered as
reportable segments. Advances classified as corporate as per Basel II norms are grouped in Corporate/Wholesale Banking
assets while all other advances are grouped as Retail Banking Assets. Deposits of 10 million and above are classified as
corporate/wholesale banking liabilities (to conform to ALM classification adopted by the bank) and all other deposits are
grouped as retail banking liabilities. Deposits of borrowers classified as corporate as per Basel II norms are treated as
wholesale deposits regardless of amount. For arriving at segment results, income and expenditure that cannot be directly
identified with a particular segment are allocated on appropriate basis.

13. IMPAIRMENT OF ASSETS

Impairment losses, if any, on Fixed Assets (including revalued assets) are recognized in accordance with the Accounting
Standard 28 ‘Impairment of Assets’ issued by Institute of Chartered Accountants of India (ICAI) and charged to Profit and
Loss Account.

14. ACCOUNTING FOR PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

As per the Accounting Standard 29, ‘Provisions, Contingent Liabilities and Contingent Assets’, issued by the Institute of
Chartered Accountants of India (ICAI), the Bank recognizes provisions only when it has a present obligation as a result of
a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation, and when a reliable estimate of the amount of the obligation can be made.

Contingent assets are not recognized in the financial statements.

15. EARNINGS PER SHARE

The bank reports basic and diluted Earnings per equity share in accordance with the Accounting Standard 20 on “Earnings
per share”. The Bank reports basic and diluted earnings per equity share in accordance with AS 20, “Earnings per share”
prescribed by the Companies (Accounting Standards) Rules, 2006. Basic Earnings per share (EPS) reported is computed by
dividing net profit after tax by the weighted average number of equity shares outstanding for the period. Diluted earnings
per equity share have been computed using the weighted average number of equity shares and dilutive potential equity
shares outstanding during the period except where the results are anti dilutive.

16. NET PROFIT

The net profit disclosed in the Profit & Loss Account is after

(i) provision for taxes

(ii) provision for standard and non performing assets as per the prudential norms.

(iii) provision for depreciation on investments

(iv) other usual and necessary provisions.

F-17
NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2009-10

1. i) On March 8, 2010, the Board of Directors of the bank has decided to call for the balance
amount of the shares offered on Rights basis in the year 2007 and fixed April 30, 2010, July 31,
2010 and September 30, 2010 respectively as the last dates for making payment of Allotment
Money, First Call and Final Call Money. The last date for payment of Allotment Money has
since been extended upto June 30, 2010.

ii) As per the direction of RBI, SVG Group (holding 24.61% of the Paid Up Capital of the bank
as on 31.03.2010) was required to divest shares in excess of 10% of the Paid Up Capital before
31.03.2010. As the same has not been completed, they have sought further extension of time
from RBI.

2. Details of provisions and contingencies debited in Profit and Loss Account during the
year

31.03.2010
(` in million)
a) Provisions towards NPA/write offs 90.51
b) Add back of eligible amount of provision
held in respect of Agricultural Debts (1.47)
Waived
c) Depreciation and write off of investments 3.38
d) Add back of excess provision for (17.97)
Depreciation on investments
e) Provision for Income tax (Including
Deferred Tax and Wealth Tax) (135.97)
f) Provision for Standard Assets 0.00

g) ) Provision for diminution on

Restructured Advances 18.20

h) Other provisions (7.99)

-------------
Total (51.31)
-------------

i) Agricultural debts waived under Agricultural Debt Waiver & Debt Relief Scheme (ADWDRS)
2008 of the Government of India during 2008-09 amounted to ` 26.million. Out of this, the bank
has received, reimbursement of ` 6.5 million from the government during the current year (in
addition to ` 11.2 million received in 2008-09). The Balance due of ` 8.3 million is included
under Advances . An amount of ` 1.9 million has been passed on to the eligible borrowers as
Debt Relief under Agricultural Debts waived under Agricultural Debt Waiver & Debt Relief
Scheme (ADWDRS) 2008.

F-18
3. Reconciliation

Initial reconciliation of inter-branch/office accounts has been completed as on 31.03.2010.

Steps have been taken to eliminate the outstanding entries and in the bank’s opinion
consequential impact on Profit and Loss Account will not be material.

4. Taxation

Income Tax assessment upto the assessment year 2007-08 has been completed. In respect of
appeals filed by the Bank, no provision is considered necessary for the disputed income tax
liability of ` 200.4 million on the basis of favourable judicial decisions and legal opinion.

5. Investments

a) The profit on sale of investments under Held to Maturity category amounting to ` 7.3
million has been taken to Profit and Loss account and a sum of ` 3.6 million, being net of
taxes and net of transfer to Statutory Reserve of such profit, has been appropriated to
Capital Reserve Account.

b) The bank has transferred securities amounting to ` 2400 million from Held To Maturity
to Available For Sale category and ` 100 million from Available For Sale to Held To
Maturity category as on 05.06.2009. The resultant depreciation of ` 1.5 million has been
charged to Profit & Loss Account.

c) In respect of Investments in Held to Maturity category, the amount of amortisation of

excess of acquisition cost over face value is ` 126.0 million (previous year ` 86.5
million) which is netted against Income on Investments.

d) Excess provisions on depreciation in the Available for Sale category investments

amounting to ` 18.0 million has been credited to Profit & Loss Account. Out of the
above, an amount of ` 8.9 million (net of taxes and net of transfer to Statutory Reserves)
has been appropriated to Investment Reserve.

e) Depreciation on investments in Available for Sale category amounted to ` 1.5 million as

on 31.03.2010 and a sum of ` 0.7 million, being net of taxes and net of Statutory
Reserves of such depreciation, has been transferred from Investment Reserve Account to
Profit and Loss Account and the same has been appropriated to General Reserve in line
with RBI guidelines.

F-19
6. Disclosures as per RBI guidelines

In terms of RBI guidelines, the following additional disclosures are made:

6.1 Capital

Items 31.03.2010

i) CRAR (%) – Basel II

10.59
ii) CRAR - Tier I capital (%) 7.84
iii) CRAR - Tier II Capital (%) 2.75

iv) Amount of subordinated debt raised as Tier- ` 928.0 Million

II capital Nil
v) Amount raised by issue of IPDI
Nil
vi) Amount raised by issue of Upper Tier II
instruments

6.2 Investments
(` in Million)
Items 31.03.2010
(1) Value of Investments
(i) Gross Value of Investments 22920.66
(a) In India 22920.66
(b) Outside India, Nil
(ii) Provisions for Depreciation 26.55
(a) In India 26.55
(b) Outside India, Nil
(iii) Net Value of Investments 22894.11
(a) In India 22894.11
(b) Outside India. Nil
(2) Movement of provisions held towards
depreciation on investments
Opening balance 42.8
(ii) Add: Provisions made during the year 01.7
(iii) Less: Write-off/ write-back of excess 17.9
provisions during the year
0.00
(iv) Less: Provision Account debited during the year
26.6
(v) Closing balance

F-20
6.2.1 Repo Transactions
(` in Million)
Minimum Maximum Daily Average Balance
outstanding outstanding outstanding as on March 31
during the during the year during the year 2010
year
Securities sold Nil Nil Nil Nil
under RBI Repo
Securities sold
under Market 150.0 150.0 1.2 Nil
Repo
Securities
purchased under 100.0 6250.0 2543.1 Nil
Reverse Repo
(RBI)
Securities
purchased under 150.0 150.0 0.4 Nil
Reverse Repo
(Market Repo)

6.2.2 Non-SLR Investment Portfolio

i) Issuer composition of Non SLR investments

(` in Million)
No. Issuer Amount Extent of Extent of Extent of Extent of
Private ‘Below ‘Unrated’ ‘Unlisted’
Placement Investment Securities Securities
Grade’
Securities
(1) (2) (3) (4) (5) (6) (7)
(i) PSUs 68.2 71.7 Nil 26.7 26.7
(ii).FIs 71.9 70.0 Nil Nil Nil
(iii).
Banks 1396.2 110.0 Nil Nil Nil
(iv).Private 98.0 7.9 Nil 7.8 7.8
Corporate
(v). Subsidiaries/ Nil Nil Nil Nil
Joint Ventures

(vi). Others 3248.0 Nil Nil Nil Nil

(RIDF, RHF,
MSME Fund)
(vii). Provision held (26.6) Nil Nil Nil Nil
towards
depreciation
Total 4855.7 259.6 0 34.5 34.5

F-21
 ii) Non performing Non-SLR investments
(` in Million)
Particulars 31.03.2010
Opening balance Nil
Additions during the year since 1st April Nil

Reductions during the above period Nil

Closing balance Nil
Total provisions held Nil

6.3 Derivatives

6.3.1 Forward Rate Agreement/ Interest Rate Swap

Nil

6.3.2 Exchange Traded Currency and Interest Rate Derivatives:

Nil

6.3.3 Disclosures on risk exposure in derivatives

Qualitative Disclosure

Nil

Quantitative Disclosures

Nil.

6.3.4 Swap Reserve

Bank has terminated Cross Currency Coupon Only Swap of notional principal ` 160.0 million on
08.06.2009. Special Reserve (Swap) of ` 5.10 million (created out of profits from the derivative
transaction in line with RBI guidelines) has been credited to General Reserve.

F-22
6.4 Asset Quality

6.4.1 Non-Performing Asset

(` in million)
Items 31.03.2010

(i) Net NPAs to Net Advances (%)

1.58%
(ii) Movement of NPAs (Gross)
(a) Opening balance 1717.8
(b) Additions during the year 534.8
(c) Reductions during the year 759.7
(d) Closing balance 1492.9
(iii) Movement of Net NPAs
(a) Opening balance 879.4
(b) Additions during the year 521.0
(c) Reductions during the year 695.2
(d) Closing balance 705.2

(iv) Movement of provisions for NPAs

(excluding provisions on standard assets)
(a) Opening balance 798.8
(b) Provisions made during the year 43.2
(c) Write-off/ write-back of excess
provisions 89.7
(d) Closing balance 752.3

F-23
6.4.2 Details of Loan Assets subjected to Restructuring
6.4.2.1 Particulars of Accounts Restructured
(` in Million)
CDR Mechanism SME Debt Restructuring Others

Balance Outstanding Balance Outstanding Balance Outstanding

All All
All Accounts
Restructured Restructured Accounts Restructure Accounts of
of the
Accounts Accounts of the d Accounts the
Borrower
Borrower Borrower

Standard No.of
Borrowers 1 1 Nil Nil 136 143
advances
Restructured Amount
Outstanding
*121.9 *127.2 Nil Nil 1247.2 1955.9
Sacrifice
(diminution in 10.5 10.5 Nil Nil 12.5 12.5
the fair value)
Sub standard No.of
Borrowers Nil Nil Nil Nil 14 14
advances
Restructured Amount
Outstanding Nil Nil Nil Nil 8.4 8.9
Sacrifice
(diminution in Nil Nil Nil Nil 0.3 0.3
the fair value)
Doubtful No.of
Borrowers
Nil Nil Nil Nil Nil Nil
advances
Restructured Amount
Outstanding Nil Nil Nil Nil Nil Nil
Sacrifice
(diminution in Nil Nil Nil Nil Nil Nil
the fair value)
TOTAL No.of
Borrowers
1 1 Nil Nil 150 157
Amount
Outstanding
121.9 127.2 Nil Nil 1255.6 1964.8
Sacrifice
(diminution in 10.5 10.5 Nil Nil 12.8 12.8
the fair value)

* Includes Cumulative Redeemable Preference Shares of Value ` 8.1 Million.

6.4.3 Details of financial assets sold to Securitisation / Reconstruction Company for Asset
Reconstruction
The Bank has not sold any financial assets to Securitisation/Reconstruction companies for Asset
Reconstruction in 2009-10 and 2008-09.

F-24
6.4.4 Details of non-performing financial assets purchased/sold

The Bank has not purchased or sold any non-performing financial assets in 2009-10 and 2008-
09.

6.4.5 Provisions on Standard Assets

(` in Million)
Item 31.03.2010

Provisions held towards Standard Assets 192.1

6.5 Business Ratio

Items 31.03.2010
(i) Interest Income as a percentage to Working Funds 7.84
(ii) Non-interest income as a percentage to Working 1.00
Funds
(0.15)
(iii) Operating Profit as a percentage to Working Funds
(iv) Return on Assets (%) (0.08)
(v) Business (Deposits plus advances) per employee
42.35
(` Million)
(vi) Profit per employee (` Million) (0.02)

F-25
6.6 Asset Liability Management
Maturity pattern of certain items of assets and liabilities (as compiled by the management and relied upon by the auditors)
(` in Million)
Day 1 2-7 Days 8 - 14 Days 15 to 28 29 days to 3 Over 3 Over 6 Over 1 year & Over 3 years & Over 5 Total
days months months & up months & up up to 3 years up to 5 years years
to 6 months to 1 year
Deposits 233.98 488.53 768.90 414.18 1920.37 1980.81 7902.46 19247.86 1543.07 35283.34 69783.50
Advances 485.32 333.27 1582.17 1198.19 2667.14 3912.41 5810.24 17835.99 5153.27 5691.38 44669.38
Investments 0 248 0 709.6 655.2 498.8 512.3 1873.4 4606.3 13790.51 22894.11
Borrowings 0.00 0.00 0.00 0.00 11.09 0.09 0.19 160.36 757.00 0.00 928.73
Foreign 527.7 31.4 22.4 209.4 258.2 567.6 252.8 71.8 0.00 0.00 1941.3
Currency assets
Foreign 109.8 9.1 71.5 12.4 104.9 188.9 333.7 360.9 27.9 0.00 1219.1
Currency
liabilities

Note: Deposits have been classified as per behavioural maturity.

F-26
6.7 Exposures

6.7.1 Exposure to Real Estate Sector (` in Million)

Category 31.03.2010

a) Direct exposure
(i) Residential Mortgages
a) Priority sector 2918.1
b) Non priority sector 147.0
c) Total 3065.1
(ii) Commercial Real Estate 1922.6
(iii) Investments in Mortgage Backed Securities
(MBS) and other securitised exposures –
a. Residential,
Nil
b. Commercial Real Estate.
Nil
b) Indirect Exposure
Fund based and non fund based exposures on National
Housing Bank (NHB) and Housing Finance Companies
Nil
(HFCs)
Total Exposure to Real Estate Sector 4987.7

6.7.2 Exposure to Capital Market (` in Million)

Items 31.03.2010

(i) Direct investment in equity shares, convertible bonds,

convertible debentures and units of equity oriented mutual
funds the corpus of which is not exclusively invested in 128.4
corporate debt
(ii) Advances against shares/bonds/debentures of other securities
or on clean basis to individuals for investment in shares 4.5
(including IPOs/ESOPs), convertible bonds, convertible
debentures and units of equity oriented mutual funds
(iii) Advances for any other purposes where shares or convertible
bonds or convertible debentures or units of equity oriented 0.2
mutual funds are taken as primary security
(iv) Advances for any other purposes to the extent secured by the
collateral security of shares or convertible bonds or
convertible debentures or units of equity oriented mutual funds
i.e. where the primary security other than shares/convertible 50.6
bonds/convertible debentures/units of equity oriented mutual
funds does not fully cover the advances
(v) Secured and unsecured advances to stockbrokers and

F-27
 guarantees issued on behalf of stockbrokers and market 5.5
makers
(vi) Loans sanctioned to corporates against the security of
shares/bonds/debentures or other securities or on clean basis
for meeting promoter’s contribution to the equity of new Nil
companies in anticipation of raising resources
(vii) Bridge loans to companies against expected equity Nil
flows/issues
(viii) Underwriting commitments taken up by the banks in respect of Nil
primary issue of shares or convertible bonds or convertible
debentures or units of equity oriented mutual funds
(ix) Financing to stock brokers for margin trading
Nil
(x) All exposures to Venture Capital Funds Nil
Total Exposure to Capital Market 189.2

6.7.3 Country Risk Exposure

(` in Million)
Risk Category Exposure (Net) Provision held as at
as at 31.03.2010 31.03.2010
Insignificant 792.6 Nil
Low 246.9 Nil
Moderate 12.6 Nil
High 5.9 Nil
Very High Nil Nil
Restricted Nil Nil
Off-Credit Nil Nil
Total 1058.0 Nil

The bank is not having exposure to any country where the net funded exposure is 1 percent or
more of the total assets and hence no provisioning is necessary for country risk, in tune with the
RBI guidelines.

6.7.4 Details of Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by
the bank.
Nil.

6.7.5 Unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights,
licenses, authority etc. are available to the bank is Nil.

F-28
6.8 Miscellaneous

6.8.1 Amount of Provisions made for Income-tax during the year

(` in Million)
31.03.2010

Provision for Income Tax (including Fringe Benefit (135.97)

Tax & Wealth tax)

6.8.2 Disclosure of Penalties imposed by RBI

Nil.

7. Disclosure Requirements as per Accounting Standards where RBI has issued guidelines
in respect of disclosure items for ‘Notes to Accounts:

7.1 Accounting Standard 5 – Net Profit or Loss for the period, Prior Period Items and
Changes in Accounting Policies
There are no material prior period income/expenditure requiring disclosure.

7.2 Accounting Standard 9 – Revenue Recognition

Income/Expenditure of certain items recognized on cash basis the effect of which on the
financial statements are not considered to be material.

7.3 Accounting Standard 15 (Revised) – Accounting for Employee Benefits in the

Financial Statements of Employers
7.3.1 Disclosures for Defined Contribution Plans – Provident Fund
Contributions to employee provident fund, debited to Profit & Loss Account during the year
amount to ` 32.9 million (previous year ` 40.0 million). There is no deficit in Income &
Expenditure Account of the Fund.

F-29
7.3.2 Disclosures for Defined Benefit Plans – Pension, Gratuity & Long term
Compensated Absences (Privilege Leave)
7.3.2.1 Amount recognised in Balance Sheet and Profit & Loss Account
The amount recognised in the balance sheet is as follows:
(` in Million)
Long term
Pension Gratuity Compensated Absences
(Privilege Leave)

2009-10 2009-10 2009-10

Present Value of Obligations - Closing 759.3 599.1 343.2

Fair Value of Plan Assets - Closing 574.1 587 N.A.

Funded Status 185.1 12.1 343.2

Unrecognised Actuarial Gains Nil Nil Nil

Net Liability recognised in Balance Sheet

(included in Other Liabilities & 185.1 12.1 343.2
Provisions)

The amount recognised in the statement of profit and loss account is as follows:
(` In Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2009-10 2009-10 2009-10

Current Service Cost 60.7 24.7 13.9

Interest Cost 52.6 45.2 24.1
Expected Return on Plan Assets
(35.1) (47.1) N.A.

Net Actuarial Loss/(Gain) recognised in the

84.6 (10.7) 24
year
Total, (included in. “Payment to and
provisions for employees”) 162.8 12.1 62

F-30
7.3.2.2 Changes in Fair Value of Plan Assets
(` in Million)
Long term
Pension Gratuity Compensated Absences
(Privilege Leave)
2009-10 2009-10 2009-10
Fair Value of Plan Assets at the beginning
438.7 588.2 N.A.
of the year
Expected Return on Plan Assets 35.1 47.1 N.A.
Contributions 292.8 Nil 41.3
Benefits Paid 192.6 46.9 41.3
Actuarial (Loss)/Gain 0.1 (1.4) N.A.
Fair Value of Plan Assets at the end of the
574.1 587.0 N.A.
year

7.3.2.3 Changes in Present Value of Obligations

(` in Million)
Long term
Compensated
Pension Gratuity
Absences (Privilege
Leave)
2009-10 2009-10 2009-10
Present Value of Obligations at the
753.8 588.2 322.5
beginning of the year
Interest Cost 52.6 45.2 24.1
Current Service Cost 60.7 24.7 13.9
Benefits Paid 192.6 46.9 41.3
Actuarial Loss/(Gain) 84.7 (12.1) 24.0
Present Value of Obligations at the end of
759.2 599.1 343.2
the year

F-31
7.3.2.4 Movement in Net Liability Recognised in Balance Sheet
(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2009-10 2009-10 2009-10

Net Liability at the beginning of the period
315.1 Nil 322.5

Add Expenses Charged to Profit & Loss

162.8 12.1 62.0
Account
Less Contributions 292.8 Nil 41.3
Net Liability at the end of the period 185.1 12.1 343.2

7.3.2.5 Actual Return on Plan Assets

(` in Million)

Long term Compensated

Pension Gratuity Absences (Privilege
Leave)

2009-10 2009-10 2009-10

Expected Return on Plan Assets 35.1 47.1 N.A.
Actuarial Gain (Loss) 0.1 (1.4) N.A.
Actual Return on Plan Assets 35.2 45.7 N.A.

7.3.2.6 Actuarial Assumptions

Long term
Compensated
Pension Gratuity
Absences
(Privilege Leave)
2009-10 2009-10 2009-10
Discount Rate (p.a.) 8.00% 8.00% 8.00%

Expected Return on Plan Assets (p.a.) 8.00% 8.00% N.A.

Future Salary Increases (p.a.) 5.00% 5.00% 5.00%

In accordance In accordance In accordance

with the standard with the standard with the standard
table LIC (1994- table LIC (1994- table LIC (1994-
Mortality 96) ultimate. 96) ultimate. 96) ultimate.

F-32
7.3.3 Other Long term Employee Benefits

As on 31.03.2010, the Bank holds provision of ` 2.93 million (previous year ` 7.5 million)
towards provision for Leave Fare Concession based on actuarial valuation.

7.4 Accounting Standard 17 – Segment Reporting

Part A: Business Segments

(` in Million)
Business Segments Treasury Corporate/Wh Retail Banking Other Banking Total
olesale Business
Banking
2009-10 2009-10 2009-10 2009-10 2009-10
Revenue 1654.90 1640.55 3060.28 163.3. 6519.03
Result -1119.85 310.54 705.52 (9.40) (113.19)
Unallocated expenses Nil
Operating profit (113.19)
Provisions other than tax 84.66
Provision for Tax (135.97)
Extraordinary profit/ loss
Nil
Net profit (61.88)
OTHER INFORMATION
Segment assets 25658.93 18647.25 26136.93 60.15 70503.26
Unallocated assets 5622.61
Total assets 76125.87
Segment liabilities 153.71 16177.42 57819.81 187.93 74338.87
Unallocated liabilities 1787.00
Total liabilities 76125.87

Part B: Geographic segments

The Bank has no branches outside India.

7.5 Accounting Standard 18 – Related Party disclosures

Key Management Personnel: Shri.V.P.Iswardas, Managing Director & Chief Executive Officer

7.6 Accounting Standard 21 - Consolidated Financial Statements

Not Applicable.

7.7 Accounting Standard 22 – Accounting for Taxes on Income

Net Deferred Tax Asset as on 31.03.2010, computed in compliance with the Accounting
Standard 22 on Accounting for Taxes on Income, amounts to ` 347.9 million

F-33
Components of Net Deferred Tax Asset as on 31.03.2010 are as follows:

(` in Million)
31.03.2010

Deferred Tax Asset

Provision for Employee Benefits (Pension & 125.9
Leave Benefits)
Provision for Standard Assets 65.3
Provision for Salary Arrears 46.5

Carry Forward Loss* 121.9

Others 14.8
Total Deferred Tax Asset 374.4

Deferred Tax Liability

Depreciation on Fixed Assets 56.1

Net Deferred Tax Asset 318.3

Add Effect of Restatement 29.6

Restated Net Deferred Tax Asset 347.9

*DTA on Carry Forward Loss is recognized, as in the opinion of the management, there is
virtual certainty of future taxable income.

7.8 Accounting Standard 23 – Accounting for Investments in Associates in

Consolidated Financial Statements
Not Applicable

7.9 Accounting Standard 24 - Discontinuing operations

Not Applicable
8. Disclosure as per Other Accounting Standards
8.1 Accounting for Fixed Assets (AS 10)
The land and buildings owned by the Bank were revalued in 1990-91, 1993-94, 1998-99, 2004-
05, 2006-07 and 2007-08 and appreciation credited to Revaluation Reserve. Depreciation for the
year on the net addition to value on such revaluation of assets of ` 6.7 million (previous year `

F-34
7.1 million) has been transferred from Revaluation Reserve to Profit and Loss Account. There
has been no revaluation of assets during this year.

8.2 Effect of Changes in Foreign Exchange Rates (AS 11)

The net profit for the year is arrived at after charging the amount of exchange differences due to
translation of monetary assets and liabilities at the closing rates.

8.3 Intangible Assets (Accounting Standard 26)

The bank has complied with AS 26 (Intangible Assets) and the disclosures required under the
Standard are as follows:
(` in Million)
31.03.2010

a) Acquired Application Software

Opening Balance at cost 31.5
Add Additions during the year 12.1
Less Disposals during the year Nil
Less Amortisation to date 20.1
Net Carrying Amount* 23.5

b) Internally Generated Software

Opening Balance at cost
73.5
Add Additions during the year
4.9
Less Disposals during the year
Nil
Less Amortisation to date
33.6
Net Carrying Amount*
44.8

*The Net carrying amount of acquired application software and internally generated
application software are included Other Assets. This includes ` 6.1 million relating to
Phase II of CBS project, which is under development stage.

8.4 Impairment of Assets (Accounting Standard 28)

In the opinion of the Bank’s management, there is no material impairment to the assets to which
Accounting Standard 28 – Impairment of Assets, applies.

8.5 Provisions, Contingent Liabilities and Contingent Assets (AS-29)

Movements in significant provisions have been disclosed at appropriate places in the Notes
forming part of the accounts.

Please refer to Note No. 2 regarding break up of provisions and contingencies debited to Profit
and Loss Account.

F-35
9. Additional Disclosures

9.1 Floating Provisions

a) Opening Balance in floating provisions account Nil

b) Quantum of floating provisions made in the accounting year Nil
c) Purpose & amount of draw down made during the accounting year Nil
d) Closing balance in floating provisions account Nil

9.2 Draw Down from Reserves

Nil.
9.3 Disclosure of complaints

A. Customer Complaints

a) No. of complaints pending at the beginning of the year 5

b) No. of complaints received during the year 96
c) No. of complaints redressed during the year 100
d) No. of complaints pending at the end of the year 1

B. Awards passed by the Banking Ombudsman

a) No. of unimplemented Awards at the beginning of the year Nil

b) No. of Awards passed by the Banking Ombudsmen during the year Nil
c) No. of Awards implemented during the year Nil
d) No. of unimplemented Awards at the end of the year Nil

9.4 Disclosure of Letter of Comforts (LOCs) issued by banks

Not applicable since the bank has no subsidiaries.

F-36
9.5 Concentration of Deposits, Advances, Exposures and NPAs

9.5.1 Concentration of Deposits

As on
31.03.2010

Total Deposits of twenty largest depositors (` in Million)

8400.2

Percentage of Deposits of twenty largest depositors to Total Deposits of the bank 12.04%

9.5.2 Concentration of Advances

As on
31.03.2010
Total Advances to twenty largest borrowers (` in million) 8609.4
Percentage of Advances to twenty largest borrowers to Total Advances of the bank 16.46%

9.5.3 Concentration of Exposures

As on
31.03.2010
Total Exposures to twenty largest borrowers/customers (` in million) 8609.4
Percentage of Exposures to twenty largest borrowers/customers to Total Exposure of the
16.34%
bank on borrowers/customers

Note: ` 1497.4 million representing bank’s CBLO (Collateralised Borrowing and Lending Obligation)
Lending repayable beyond 15 days (classified as advances in line with RBI guidelines) is not reckoned
while arriving at concentration of advances and exposures.

9.5.4 Concentration of NPAs

(` in Million)
As on
31.03.2010
Total Exposures to top four NPA Accounts (` in Million) 198.4

F-37
 9.6 Sector wise NPAs

Percentage of NPAs to Total

Sl.No. Sector Advance in that Sector (As on
31.03.2010)
1. Agriculture & allied activities 2.91%
2. Industry (Micro & small, Medium and Large) 6.80%
Services
3. 4.03%
Personal Loans
4. 1.62%

9.7 Movement of NPA

Particulars (` in Million)
Gross NPAs as on 1st April of 2009 (Opening Balance) 1717.8
Additions (Fresh NPAs) during the year 534.8
Sub-total (A) 2252.6
Less:-
(i) Upgradations 240.8
(ii) Recoveries (excluding recoveries made from upgraded accounts) 445.3
(iii) Write-offs 73.6
Sub-total (B) 759.7
Gross NPAs as on 31st March of 2010 (closing balance) (A – B) 1492.9

9.8 Provision Coverage Ratio

Provision Coverage Ratio of the bank (computed in line with DBOD

No.BP.BC.64/21.04.048/2009-10 dated December 1, 2009) as on 31.03.2010 is 70.96%.

9.9 Overseas Assets, NPAs and Revenue

(` in Million)
Particulars 31.03.2010
Total Assets (Deposits with banks outside India) 416.2
Total NPAs Nil
Total Revenues (Interest on Deposits with banks outside India) 0.4

9.10 Off-balance Sheet SPVs sponsored

Nil.

F-38
9.11 Income from Bancassurance

(` in Million)
Sl.No. Nature of Income 31.03.2010
1. From Selling Life Insurance Policies 76.45
2. From Selling Non Life Insurance Policies 3.33
3. From Selling Mutual Fund Products 0.9
4. Others Nil
5. Total 80.68

10. Comparative Figures

Previous year’s figures have been regrouped and recast wherever necessary to conform to current
year’s classification.

F-39
NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2010-11

1. Details of provisions and contingencies debited in Profit and Loss Account during the
year

(` in Million)
31.03.2011 31.03.2010
a Provisions towards NPA/write offs 134.16 90.51
b Add back of eligible amount of provision held in respect (4.62) (1.47)
of Agricultural Debts Waived
c Depreciation and write off of investments 2.56 3.38
d Add back of excess provision for Depreciation on (1.00) (17.97)
investments
e Provision for Income tax (Including Deferred Tax and 92.87 (135.97)
Wealth Tax)
f Provision for Standard Assets 36.86 00.0
g Provision for diminution on Restructured Advances (4.80) 18.20
h Other provisions (1.58) (7.99)
Total 254.45 (51.31)

Note: Claim for ` 26 Million under Debts waiver and ` 2 Million for Debt Relief under
Agricultural Debt Waiver & Debt Relief Scheme (ADWDRS) 2008 were submitted to Reserve
Bank of India and excess provision on ADWDRS to the extent of ` 4.6 Million was maintained
as directed in the scheme. Consequent to receipt of ` 10.3 Million as final settlement under
ADWDRS 2008, the excess provision of ` 4.6 Million held has been reversed.
.
2. Salary Arrears

During the year, on account of wage settlement with employees, bank has incurred an
expenditure of ` 250.67 Million towards salary arrears pertaining to the period up to 31.03.2010.
After netting provision held for salary arrears of ` 136.93 Million, the balance amount of `
113.74 Million has been charged to Profit and Loss account.

3. Share Capital

During the year, the bank has received a sum of `1474 Million (including premium of ` 1349.8
Million) as allotment money & call money towards the shares allotted on rights basis in the year
2009, and call money on shares allotted in the earlier years.

In respect of calls in arrears bank has issued a final notice for payment on or before 30.06.2011.

F-40
4. Reconciliation

Initial reconciliation of inter-branch/office accounts has been completed as on 31.03.2011.

Steps have been taken to eliminate the outstanding entries and in the bank’s opinion
consequential impact on Profit and Loss Account will not be material.

5. Taxation

a) In respect of appeals filed by the Bank, no provision is considered necessary for

the disputed income tax liability of ` 319.2 Million on the basis of favourable
judicial decisions and legal opinion.

b) Tax liability on account of Minimum Alternative Tax (MAT) has been recognized
as a liability and as an asset in line with Guidance Note on Accounting of Credit
Available in respect of Minimum Alternative Tax under the Income Tax Act,
1961, issued by ICAI.

6. Investments

a) The profit on sale of investments under Held to Maturity category amounting to ` 12.2
Million (previous year ` 7.3 Million) has been taken to Profit and Loss account and a
sum of ` 6.1 Million (previous year ` 3.6 Million), being net of taxes and net of transfer
to Statutory Reserve of such profit, has been appropriated to Capital Reserve Account.

b) In respect of Investments in Held to Maturity category, the amount of amortisation of

excess of acquisition cost over face value is ` 137.1 Million (previous year ` 126.0
Million) which is netted against Income on Investments.

c) Excess provisions on depreciation in the Held for Trading category of investments

amounting to ` 0.2 Million (previous year Nil) and excess provisions on depreciation in
the Available for Sale category of investments amounting to ` 0.9 Million (previous year
` 18 Million) has been credited to Profit & Loss Account. Out of the above, an amount of
` 0.5 Million (net of taxes and net of transfer to Statutory Reserves (previous year ` 8.9
Million) has been appropriated to Investment Reserve.

d) Further provisions on depreciation on investments in the Available for Sale category

investments amounting to ` 2.6 Million (previous year ` 1.5 Million) is debited to Profit
& Loss account. An equivalent amount of ` 1.3 Million, net of taxes and net of transfer
to Statutory Reserve, (previous year ` 0.7 Million) has been transferred from Investment
Reserve Account to Profit and Loss Account and the same has been appropriated to
General Reserve in line with RBI guidelines.

e) During 2010-11, the bank has not transferred any securities from Held to Maturity to
Available for Sale category (previous year ` 2400 Million) or from Available for Sale to
Held to Maturity category (previous year ` 100 Million).

F-41
7. Disclosures as per RBI guidelines

In terms of RBI guidelines, the following additional disclosures are made:

7.1 Capital

Items 31.03.2011 31.03.2010

i) CRAR (%) – Basel II

11.28 10.59
ii) CRAR - Tier I capital (%) 9.48 7.84
iii) CRAR - Tier II Capital (%) 1.80 2.75

iv) Amount of subordinated debt raised as ` 917 Million ` 928 Million

Tier-II capital
v) Amount raised by issue of IPDI Nil Nil
vi) Amount raised by issue of Upper Tier II Nil Nil
instruments

7.2 Investments
(` in Million)
Items 31.03.2011 31.03.2010
(1) Value of Investments
(i) Gross Value of Investments 26930.69 22920.66
(a) In India 26930.69 22920.66
(b) Outside India, Nil Nil
(ii) Provisions for Depreciation 28.11 26.55
(a) In India 28.11 26.55
(b) Outside India, Nil Nil
(iii) Net Value of Investments 26902.58 22894.11
(a) In India 26902.58 22894.11
(b) Outside India. Nil Nil
(2) Movement of provisions held towards
depreciation on investments
(i) Opening balance 26.6 42.8
(ii) Add: Provisions made during the year 2.6 1.7
(iii) Less: Write-off/ write-back of excess
provisions during the year
0.9 17.9
(iv) Less: Provision Account debited during the
year
(v) Closing balance 0.2 0.00
28.1 26.6

F-42
7.2.1 Repo Transactions (In Face Value)
(` in Million)
Daily
Minimum Maximum Balance
Average
outstanding outstanding as on
outstanding
during the during the March 31
during the
year year 2011
year
Securities sold under
repo
Nil 1850 302.3 Nil
i. Government Securities
Nil Nil Nil Nil
Ii Corporate debt
securities

Securities purchased
under reverse repo

i. Government Securities Nil 3000 136.6 Nil

Ii Corporate debt Nil Nil Nil Nil

securities

7.2.2 Non-SLR Investment Portfolio

i) Issuer composition of Non SLR investments
(` in Million)
No. Issuer Amount Extent of Extent of Extent of Extent of
Private ‘Below ‘Unrated’ ‘Unlisted’
Placement Investment Securities Securities
Grade’
Securities
(1) (2) (3) (4) (5) (6) (7)
(i) PSUs 354.2 50.0 NIL 0.00 0.00
(ii). FIs 63.6 60.0 NIL NIL 0
(iii). Banks 1655.6 110.0 NIL NIL 0
(iv). Private 108.4 7.9 7.8 0 7.8
Corporate
(v). Subsidiaries/ NIL NIL NIL NIL NIL
Joint Ventures
(vi). Others 2997.8 NIL NIL NIL NIL
(RIDF, RHF,
MSME Fund)
(vii). Provision held (28.1) NIL NIL NIL NIL
towards
depreciation
Total 5151.5 227.9 7.8 0.00 7.8

F-43
 ii) Non performing Non-SLR investments
(` in Million)
Particulars 31.03.2011 31.03.2010
Opening balance Nil Nil
Additions during the year since 1st Nil Nil
April
Reductions during the above period Nil Nil
Closing balance Nil Nil
Total provisions held Nil Nil

7.3 Derivatives

7.3.1 Forward Rate Agreement/ Interest Rate Swap

Nil.

7.3.2 Exchange Traded Currency and Interest Rate Derivatives:

Nil.

7.3.3 Disclosures on risk exposure in derivatives

Qualitative & Quantitative Disclosure

Nil.

7.4 Asset Quality

7.4.1 Non-Performing Asset

(` in Million)
Particulars 31.03.2011 31.03.2010

(i) Net NPAs to Net Advances (%)

1.74% 1.58%
(ii) Movement of NPAs (Gross)
(a) Opening balance 1492.9 1717.8
(b) Additions during the year 1078.7 534.8
(c) Reductions during the year 647.1 759.7
(d) Closing balance 1924.5 1492.9

(iii) Movement of Net NPAs

(a) Opening balance 705.2 879.4

(b) Additions during the year 938.1 521.0
(c) Reductions during the year 559.3 695.2
(d) Closing balance 1084.0 705.2

F-44
 (iv) Movement of provisions for NPAs
(v) (excluding provisions on standard assets)

(a) Opening balance 752.3 798.8

(b) Provisions made during the year 85.5 43.2
(c) Write-off/ write-back of excess
provisions 31.2 89.7
(d) Closing balance 806.6 752.3

7.4.2 Details of Loan Assets subjected to Restructuring

7.4.2.1 Particulars of Accounts Restructured
(` in Million)
CDR Mechanism SME Debt Restructuring Others

Balance Outstanding Balance Outstanding Balance Outstanding

All All
All Accounts
Restructured Restructured Accounts Restructure Accounts of
of the
Accounts Accounts of the d Accounts the
Borrower
Borrower Borrower

Standard No.of
Borrowers
1 1 Nil Nil 102 118
advances
Restructured Amount
Outstanding *106.4 *106.4 Nil Nil 781.3 1398.1
Sacrifice
(diminution in 7.5 Nil Nil Nil 10.1 Nil
the fair value)
Sub standard No.of
Borrowers
Nil Nil Nil Nil 4 7
advances
Restructured Amount
Outstanding
Nil Nil Nil Nil 61.5 72.8
Sacrifice
(diminution in Nil Nil Nil Nil 0.8 Nil
the fair value)
Doubtful No.of
Borrowers
Nil Nil Nil Nil 20 20
advances
Restructured Amount
Outstanding
Nil Nil Nil Nil 8.0 8.0
Sacrifice
(diminution in Nil Nil Nil Nil 0.2 Nil
the fair value)
TOTAL No.of
Borrowers
1 1 Nil Nil 126 145
Amount
Outstanding
106.4 106.4 Nil Nil 850.8 1478.9
Sacrifice
(diminution in 7.5 Nil Nil Nil 11.1 Nil
the fair value)

* Includes Cumulative Redeemable Preference Shares of Value ` 8.1 Million.

F-45
7.4.3 Details of financial assets sold to Securitisation / Reconstruction Company for Asset
Reconstruction

2010-11 2009-10
(i) No. of accounts 2 Nil
(ii) Aggregate value (net of provisions) of accounts 0 Nil
sold to SC/RC
(iii) Aggregate consideration
` 107.5 Million Nil
(iv) Additional consideration realized in respect of
accounts transferred in earlier years Nil Nil
(v) Aggregate gain/loss over net book value
` 107.5 Million Nil

During the year bank has sold two Non Performing Assets in DA 3 category, which were
partially written off. The aggregate principal in these accounts was ` 121.9 Million and ` 72.6
Million of this was technically written off while the balance of ` 49.3 Million was fully
provided, making the net book value zero. Bank has received aggregate consideration of ` 107.5
Million. Of this, ` 72.6 Million representing recovery of technically written off portion is
included in Miscellaneous Income of Other Income. The balance amount of ` 34.9 Million,
representing excess provision, has been retained in provision for bad debt account.

7.4.4 Details of non-performing financial assets purchased/sold (other than to

Securitisation/Reconstruction Company for Asset Reconstruction)

Nil

7.4.5 Provisions on Standard Assets

(` in Million)

Particulars 31.03.2011 31.03.2010

Provisions held towards Standard Assets 229.0 192.1

F-46
7.5 Business Ratio

Particulars 31.03.2011 31.03.2010

(i) Interest Income as a percentage to
Working Funds 8.68 7.84
(ii) Non-interest income as a percentage
0.85 1.00
to Working Funds
(iii) Operating Profit as a percentage to 0.52 (0.15)
Working Funds
(iv) Return on Assets (%) 0.23 (0.08)

(v) Business (Deposits plus advances) 53.96 42.35

per employee(` Million)
(vi) Profit per employee (` Million) 0. 07 (0.02)

F-47
7.6 Asset Liability Management

Maturity pattern of certain items of assets and liabilities (as compiled by the management and relied upon by the auditors)

(` in Million)
As on 31.03.2011 Day 1 2-7 Days 8 - 14 Days 15 to 28 29 days to 3 Over 3 Over 6 Over 1 year & Over 3 years & Over 5 Total
days months months & up months & up up to 3 years up to 5 years years
to 6 months to 1 year
Deposits 259.47 922.01 2126.66 1167.33 3940.03 5813.96 4921.75 23768.23 954.89 43382.36 87256.69
Advances 878.00 585.00 844.00 1072.00 2959.00 6200.00 8788.25 27536.00 7464.00 5874.00 62200.25
Investments 0.00 1250.20 248.70 1492.50 491.50 2.00 15.10 3130.00 5520.40 14752.18 26902.58
Borrowings 0.00 1034.10 0.00 0.00 0.09 128.25 628.34 680.95 766.46 0.00 3238.19
Foreign Currency
assets 431.72 39.34 156.87 120.12 442.9 376.73 181.08 44.46 0.00 0.00 1793.22
Foreign Currency
liabilities 96.93 0.00 159.79 22.22 87.49 195.20 500.12 365.03 45.61 0.00 1472.39

Note: Deposits have been classified as per behavioural maturity.

F-48
7.7 Exposures

7.7.1 Exposure to Real Estate Sector (` in Million)

Category 31.03.2011 31.03.2010

a) Direct exposure
(i) Residential Mortgages
a) Priority sector 2776.6 2918.1
b) Non priority sector 273.1 147.0
c) Total 3049.7 3065.1
(ii) Commercial Real Estate 2761.2 1922.6
(iii) Investments in Mortgage Backed Securities
(MBS) and other securitised exposures –
a. Residential, Nil Nil
b. Commercial Real Estate. Nil Nil
b) Indirect Exposure
Fund based and non fund based exposures on National
Housing Bank (NHB) and Housing Finance Companies
Nil Nil
(HFCs)
Total Exposure to Real Estate Sector 5810.9 4987.7

7.7.2 Exposure to Capital Market (` in Million)

Items 31.03.2011 31.03.2010

(i) Direct investment in equity shares, convertible bonds,

convertible debentures and units of equity oriented mutual
funds the corpus of which is not exclusively invested in 84.2 128.4
corporate debt
(ii) Advances against shares/bonds/debentures of other
securities or on clean basis to individuals for investment in 3.2 4.5
shares (including IPOs/ESOPs), convertible bonds,
convertible debentures and units of equity oriented mutual
funds
(iii) Advances for any other purposes where shares or
convertible bonds or convertible debentures or units of 0.1 0.2
equity oriented mutual funds are taken as primary security
(iv) Advances for any other purposes to the extent secured by
the collateral security of shares or convertible bonds or
convertible debentures or units of equity oriented mutual
funds i.e. where the primary security other than Nil 50.6
shares/convertible bonds/convertible debentures/units of

F-49
 equity oriented mutual funds does not fully cover the
advances
(v) Secured and unsecured advances to stockbrokers and
guarantees issued on behalf of stockbrokers and market
makers 4.9 5.5

(vi) Loans sanctioned to corporates against the security of

shares/bonds/debentures or other securities or on clean basis
for meeting promoter’s contribution to the equity of new Nil Nil
companies in anticipation of raising resources
(vii) Bridge loans to companies against expected equity
flows/issues
Nil Nil
(viii) Underwriting commitments taken up by the banks in respect
of primary issue of shares or convertible bonds or
convertible debentures or units of equity oriented mutual Nil Nil
funds
(ix) Financing to stock brokers for margin trading
(x) All exposures to Venture Capital Funds Nil Nil
Total Exposure to Capital Market Nil Nil
92.4 189.2

7.7.3 Risk category wise country exposure

(` in Million)
Risk Category Exposure Provision held Exposure Provision
(Net) as at as at (Net) as at held as at
31.03.2011 31.03.2011 31.03.2010 31.03.2010
Insignificant 899.8 Nil 792.6 Nil
Low 170.3 Nil 246.9 Nil
Moderate 13.8 Nil 12.6 Nil
High Nil Nil 5.9 Nil
Very High Nil Nil Nil Nil
Restricted Nil Nil Nil Nil
Off-Credit Nil Nil Nil Nil
Total 1083.9 Nil 1058.0 Nil

The bank is not having exposure to any country where the net funded exposure is 1 percent or
more of the total assets and hence no provisioning is necessary for country risk, in accordance
with the RBI guidelines.

F-50
7.7.4 Details of Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by
the bank.
(` in Million)
Investment Total Exposure
Credit Exposure as Outstanding as
Sr as on as on
Name of Borrower on 31.03.2011 on 31.03.2011
No 31.03.2011 31.03.2011
FB NFB FB NFB
1 Tamilnadu
1009.9 0.00 1009.9 0.00 0.00 1009.9
Electricity Board
2 Ajmer Vidyut
1000.0 0.00 650.0 0.00 0.00 1000.0
Vitran Nigam Ltd

7.7.5 Unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights, licenses,
authorisation etc. are available to the bank is Nil.

7.8 Miscellaneous
7.8.1 Amount of Provisions made for Income-tax during the year
(` in Million)
31.03.2011 31.03.2010

Provision for Income Tax (including Deferred Tax) 92.87 (135.97)

7.8.2 Disclosure of Penalties imposed by RBI

Nil.

8. Disclosure Requirements as per Accounting Standards where RBI has issued guidelines
in respect of disclosure items for ‘Notes to Accounts:

8.1 Accounting Standard 5 – Net Profit or Loss for the period, Prior Period Items and
Changes in Accounting Policies
There are no material prior period income/expenditure requiring disclosure.
8.2 Accounting Standard 9 – Revenue Recognition
Income/Expenditure of certain items are recognized on cash basis the effect of which on the
financial statements are not considered to be material.

F-51
8.3 Accounting Standard 15 (Revised) – Accounting for Employee Benefits in the Financial
Statements of Employers
8.3.1 Disclosures for Defined Contribution Plans – Provident Fund
Contributions to employee provident fund, debited to Profit & Loss Account during the year
amount to ` 65.8 Million (previous year ` 32.9 Million). Amount debited to Profit & Loss
Account includes ` 5.0 Million (previous year Nil) towards contribution of the bank to meet the
deficit in Income & Expenditure of the provident fund.

8.3.2 Disclosures for Defined Benefit Plans – Pension, Gratuity & Long term
Compensated Absences (Privilege Leave)
During the year the bank reopened the pension option for such of its employees (including
retirees) who had not opted for the pension scheme earlier. As a result of exercise of this option
by 1625 employees, the bank has incurred a liability of ` 673.6 Million. Further, during the year,
the limit of gratuity payable was also enhanced pursuant to the amendment to the Payment of
Gratuity Act, 1972. As a result, the gratuity liability of the Bank has increased by ` 207.4
Million.

In terms of the requirements of the Accounting Standard 15 – Employee Benefits, the entire
amount of ` 881 Million is required to be charged to the Profit & Loss Account. However, the
Reserve Bank of India has issued Cir.no.DBOD.BP. BC.80/21.04.018/2010-11 dated 9th
February 2011 on Reopening of Pension Option to Employees of Public Sector Banks and
Enhancement in Gratuity Limits – Prudential Regulatory Treatment (the circular has been made
applicable to this bank also vide DBOD.No.BP.BC.15896/21.04.018/2010-11 dated April 08,
2011). In accordance with the provisions of the said circular, the bank would amortise ` 604.8
Million (Pension ` 397.4 Million and Gratuity ` 207.4 Million), over a period of 5 years.
Accordingly, ` 121 Million (representing one-fifth of ` 604.8 Million) has been charged to
Profit & Loss Account. In terms of the requirements of the aforesaid RBI circular, the balance
amount carried forward (i.e., ` 483.8 Million) does not include any cost relating to
separated/retired employees. Pension Cost relating to separated/retired employees amounting to
` 276.2 Million has been charged fully to Profit & Loss Account.

Had such circular not been issued by the RBI, the profit before tax of the bank would have been
lower by ` 483.8 Million pursuant to application of the requirements of AS 15.

F-52
8.3.2.1 Amount recognised in Balance Sheet and Profit & Loss Account

The amount recognised in the balance sheet is as follows:

(` in Million)
Long term
Compensated
Pension Gratuity
Absences
(Privilege Leave)
2010-11
New Optees in 2009-
Old 2010-11 2009-10 2010-11 2009-10
service as on 10
Optees
31.03.2011
Present Value of
1369 816.6 759.3 838.3 599.1 394.9 343.2
Obligations - Closing
Fair Value of Plan
971.6 714 574.1 563.3 587 N.A. N.A.
Assets - Closing
Funded Status 397.4 102.6 185.1 275 12.1 394.9 343.2
Unrecognised
Nil Nil Nil Nil Nil Nil Nil
Actuarial Gains
Less Amount
unamortised and
317.9 N.A. N.A. 165.9 N.A. N.A. N.A.
carried forward as per
RBI circular
Net Liability
recognised in Balance
Sheet (included in
79.5 102.6 185.1 109.1 12.1 394.9 343.2
Others of Other
Liabilities &
Provisions)

F-53
The amount recognised in the statement of profit and loss account is as follows:
(` in Million)
Long term
Compensated
Pension Gratuity
Absences
(Privilege Leave)
2010-11
New Optees in 2009- 2010- 2009-
Old 2009-10 2010-11
service as on 10 11 10
Optees
31.03.2011
Current Service
330.9 201.6 60.7 38.0 24.7 16.1 13.9
Cost
Past Service Cost N.A. N.A. N.A. 207.4 N.A. N.A. N.A.
Interest Cost Nil 51.6 52.6 44.3 45.2 25.5 24.1
Expected Return
on Plan Assets Nil (45.9) (35.1) (46.9) (47.1) N.A. N.A.

Net Actuarial
Loss/(Gain)
1038 8.1 84.6 47.2 (10.7) 59.1 24
recognised in the
year
Amount
unamortised and
(317.9) N.A. N.A. (165.9) N.A. N.A. N.A.
carried forward as
per RBI circular
Contribution of
New Pension (971.5) N.A. N.A. N.A. N.A. N.A. N.A.
Optees
Total, (included in
Item I. “Payment
to and provisions
79.5 215.4 162.8 124.1 12.1 100.7 62
for employees” of
Operating
Expenses)

In addition to the above, Pension Cost relating to separated/retired employees amounting to `

276.2 Million has been charged fully to Profit & Loss Account. Thus, the total amount charged
on account of pension in 2010-11 is ` 571.1 Million (i.e. ` 215.4 Million for old optees, ` 79.5
Million for new optees in service as on 31.03.2011 and ` 276.2 Million for retirees) as against `
162.8 Million in 2009-10.

F-54
8.3.2.2 Changes in Fair Value of Plan Assets
(` in Million)
Long term
Compensated
Pension Gratuity
Absences
(Privilege Leave)
2010-11
New Optees in 2009- 2010- 2009-
Old 2010-11 2009-10
service as on 10 11 10
Optees
31.03.2011
Fair Value of Plan Assets
at the beginning of the Nil 574.1 438.7 587 588.2 N.A. N.A.
year
Expected Return on Plan
Nil 45.9 35.1 46.9 47.1 N.A. N.A.
Assets
Contributions 971.6 297.9 292.8 27.1 Nil 48.9 41.3
Benefits Paid Nil 228.6 192.6 89.9 46.9 48.9 41.3
Actuarial (Loss)/Gain Nil 24.7 1.0 (7.8) (1.4) N.A. N.A.

Fair Value of Plan Assets

971.6 714.0 574.1 563.3 587.0 N.A. N.A.
at the end of the year

F-55
8.3.2.3 Changes in Present Value of Obligations (` in Million)
Long term
Compensated
Pension Gratuity
Absences
(Privilege Leave)

2010-11
2009- 2010- 2009-
New Optees in 2010-11 2009-10
Old 10 11 10
service as on
Optees
31.03.2011
Present Value of
Obligations at the Nil 759.2 753.8 599.1 588.2 343.2 322.5
beginning of the year
Interest Cost Nil 51.6 52.6 44.3 45.2 25.5 24.1

Current Service Cost 330.9 201.6 60.7 38.0 24.7 16.1 13.9

Past Service Cost N.A. N.A. N.A. 207.4 N.A. N.A. N.A.
Benefits Paid Nil 228.6 192.6 89.9 46.9 48.9 41.3

Actuarial Loss/(Gain) 1038.0 32.8 84.7 39.4 (12.1) 59.1 24.0

Present Value of
Obligations at the end 1369.0 816.6 759.2 838.3 599.1 394.9 343.2
of the year

F-56
8.3.2.4 Movement in Net Liability Recognised in Balance Sheet
(` in Million)
Long term
Compensated
Pension Gratuity Absences
(Privilege
Leave)
2010-11
New Optees in 2009- 2010- 2009- 2010- 2009-
Old 10 11 10 11 10
service as on
Optees
31.03.2011
Net Liability at the
beginning of the period N.A. 185.1 315.1 12.1 Nil 343.2 322.5

Add Expenses Charged

to Profit & Loss 79.5 215.4 162.8 124.1 12.1 100.7 62.0
Account
Less Contributions N.A. 297.9 292.8 27.1 Nil 48.9 41.3
Net Liability at the end
79.5 102.6 185.1 109.1 12.1 395 343.2
of the period

8.3.2.5 Actual Return on Plan Assets

(` in Million)
Long term
Compensated
Pension Gratuity Absences
(Privilege
Leave)
2010-11
New Optees in 2009- 2010- 2009- 2010- 2009-
Old 10 11 10 11 10
service as on
Optees
31.03.2011
Expected Return on Plan
N.A. 45.9 35.1 46.9 47.1 N.A. N.A.
Assets
Actuarial Gain (Loss) N.A. 24.7 0.1 (7.8) (1.4) N.A. N.A.
Actual Return on Plan
N.A. 70.6 35.2 39.1 45.7 N.A. N.A.
Assets

F-57
8.3.2.6 Actuarial Assumptions
Long term
Compensated
Pension Gratuity
Absences (Privilege
Leave)
2010-11 2009-10 2010-11 2009-10 2010-11 2009-10
Discount Rate (p.a.) 8.00% 8.00% 8.00% 8.00% 8.00% 8.00%
Expected Return on Plan Assets (p.a.)
8.00% 8.00% 8.00% 8.00% N.A. N.A.

Future Salary Increases (p.a.) 5.00% 5.00% 5.00% 5.00% 5.00% 5.00%
Mortality In accordance with In accordance with In accordance with the
the standard table the standard table standard table LIC
LIC (1994-96). LIC (1994-96). (1994-96).

8.3.3 Other Long term Employee Benefits

As on 31.03.2011 the Bank holds provision of ` 2.73 Million (previous year ` 2.93 Million)
towards provision for Leave Fare Concession based on actuarial valuation.
8.4 Accounting Standard 17 – Segment Reporting
Part A: Business Segments

(` in Million)
Business Treasury Corporate/Wholesal Retail Banking Other Banking Total
Segments e Banking Business
2010-11 2009-10 2010-11 2009-10 2010-11 2009-10 2010-11 2009-10 2010-11 2009-10
Revenue 1653.76 1654.90 2488.25 1640.55 4075.28 3060.28 148.45 163.30 8365.74 6519.03
Result (869.33) (1119.85) 553.25 310.54 749.36 705.52 20.90 (9.40) 454.18 (113.19)
Unallocated
expenses Nil Nil
Operating profit 454.18 (113.19)
Provisions other 161.58 84.66
than tax
Provision for 92.87 (135.97)
Tax
Extraordinary
profit/ loss Nil Nil
Net profit 199.73 (61.88)
OTHER
INFORMATION
Segment assets 24314.65 25658.93 29562.15 18647.25 38097.66 26136.93 30.22 60.15 92004.68 70503.26
Unallocated 5591.96 5622.61
assets
Total assets 97596.64 76125.87
Segment 1277.79 153.71 25547.16 16177.42 68847.31 57819.81 267.35 187.93 95939.61 74338.87
liabilities
Unallocated 1657.03 1787.00
liabilities
Total liabilities 97596.64 76125.87

Part B: Geographic segments

The Bank has no branches outside India.

F-58
8.5 Accounting Standard 18 – Related Party disclosures
Key Management Personnel: Shri.V.P.Iswardas, Managing Director & Chief Executive Officer

8.6 Accounting Standard 21 - Consolidated Financial Statements

Not Applicable.

8.7 Accounting Standard 22 – Accounting for Taxes on Income

Net Deferred Tax Asset as on 31.03.2011, computed in compliance with the Accounting
Standard 22 on Accounting for Taxes on Income, amounts to ` 252.2 Million.

Components of Net Deferred Tax Asset as on 31.03.2011 are as follows:

(` in Million)
31.03.2011 31.03.2010

Deferred Tax Asset

Provision for Employee Benefits (Leave 138.3 125.9
Benefits)
Provision for Standard Assets 74.3 65.3
Provision for Salary Arrears 0.0 46.5
Carry Forward Loss* 83.5 121.9
Others 9.8 14.8

Total Deferred Tax Asset 305.9 374.4

Deferred Tax Liability

Depreciation on Fixed Assets 43.2 56.1

Net Deferred Tax Asset 262.7 318.3

Add/Less Effect of Restatement (10.4) 29.6
Net Deferred Tax Asset after Restatement 252.3 347.9

*DTA on Carry Forward Loss is recognized, as in the opinion of the management, there is virtual
certainty of future taxable income, considering the operating profit for current year and the
future prospects of the bank.

8.8 Accounting Standard 23 – Accounting for Investments in Associates in Consolidated

Financial Statements
Not Applicable

F-59
8.9 Accounting Standard 24 - Discontinuing operations
Not Applicable

9. Disclosure as per Other Accounting Standards

9.1 Accounting for Fixed Assets (AS 10)

The land and buildings owned by the Bank were revalued in 1990-91, 1993-94, 1998-99, 2004-
05, 2006-07 and 2007-08 and appreciation credited to Revaluation Reserve. Depreciation for the
year on the net addition to value on such revaluation of assets of ` 6.4 Million (previous year `
6.7 Million) has been transferred from Revaluation Reserve to Profit and Loss Account. There
has been no revaluation of assets during this year.

9.2 Effect of Changes in Foreign Exchange Rates (AS 11)

The net profit for the year is arrived at after charging the amount of exchange differences due to
translation of monetary assets and liabilities at the closing rates.

9.3 Intangible Assets (Accounting Standard 26)

The bank has complied with AS 26 (Intangible Assets) and the disclosures required under the
Standard are as follows:
` in Million)
(`
31.03.2011 31.03.2010

a) Acquired Application Software

Opening Balance at cost 42.2 31.5
Add Additions during the year 4.1 12.1
Less Disposals during the year Nil Nil
Less Amortisation to date 26.2 20.1
Net Carrying Amount* 20.1 23.5

b) Internally Generated Software

Opening Balance at cost 78.5 73.5
Add Additions during the year 0.00 4.9
Less Disposals during the year Nil Nil
Less Amortisation to date 48.9 33.6
Net Carrying Amount* 29.6 44.8

*The Net carrying amount of acquired application software and internally generated
application software are included in Other Assets.

F-60
 9.4 Impairment of Assets (Accounting Standard 28)

In the opinion of the Bank’s management, there is no material impairment to the assets to which
Accounting Standard 28 – Impairment of Assets, applies.

9.5 Provisions, Contingent Liabilities and Contingent Assets (AS-29)

Movements in significant provision heads have been disclosed at appropriate places in the Notes
forming part of the accounts.

Please refer to Note No. 2 regarding break up of provisions and contingencies debited to Profit
and Loss Account.

10. Additional Disclosures

10.1 Floating Provisions

a) Opening Balance in floating provisions account Nil

b) Quantum of floating provisions made in the accounting year Nil
c) Purpose & amount of draw down made during the accounting year Nil
d) Closing balance in floating provisions account Nil

10.2 Draw Down from Reserves

Nil.
10.3 Disclosure of complaints

A. Customer Complaints

a) No. of complaints pending at the beginning of the year 1

b) No. of complaints received during the year 141
c) No. of complaints redressed during the year 136
d) No. of complaints pending at the end of the year 6

B. Awards passed by the Banking Ombudsman

a) No. of unimplemented Awards at the beginning of the year Nil

b) No. of Awards passed by the Banking Ombudsmen during the year Nil
c) No. of Awards implemented during the year Nil
d) No. of unimplemented Awards at the end of the year Nil

10.4 Disclosure of Letter of Comforts (LOCs) issued by banks

Not applicable since the bank has no subsidiaries.

F-61
10.5 Concentration of Deposits, Advances, Exposures and NPAs

10.5.1 Concentration of Deposits

As on As on
31.03.2011 31.03.2010

Total Deposits of twenty largest depositors (` in Million) 12482.5 8400.2

Percentage of Deposits of twenty largest depositors to Total Deposits of 14.31% 12.04%

the bank

10.5.2 Concentration of Advances

As on As on
31.03.2011 31.03.2010
Total Advances to twenty largest borrowers (` in Million) 12200.9 8609.4
Percentage of Advances to twenty largest borrowers to Total Advances of
16.80% 16.46%
the bank

10.5.3 Concentration of Exposures

As on As on
31.03.2011 31.03.2010
Total Exposures to twenty largest borrowers/customers (` in Million) 12200.9 8609.4
Percentage of Exposures to twenty largest borrowers/customers to Total
16.58% 16.34%
Exposure of the bank on borrowers/customers

10.5.4 Concentration of NPAs

(` in Million)
As on As on
31.03.2011 31.03.2010
Total Exposures to top four NPA Accounts 377.4 198.4

F-62
10.6 Sector wise NPAs

Percentage of NPAs to Total Advance in

Sl.No. Sector that Sector
As on 31.03.2011 As on 31.03.2010
1. Agriculture & allied activities 1.11% 2.91%
Industry (Micro & small, Medium
2. and Large) 6.34% 6.80%
3. Services 4.14% 4.03%
4. Personal Loans 1.51% 1.62%

10.7 Movement of NPA

(` in Million)
Particulars 2010-11 2009-10
Opening Balance of Gross NPA 1492.9 1717.8
Additions (Fresh NPAs) during the year 1078.7 534.8
Sub-total (A) 2571.6 2252.6
Less:-
(i) Upgradations 212.3 240.8
(ii) Recoveries (excluding recoveries made 347.3 445.3
from upgraded accounts)
(iii) Write-offs 87.5 73.6
Sub-total (B) 647.1 759.7
Closing balance of Gross NPA (A – B) 1924.5 1492.9

10.8 Provision Coverage Ratio

As on 31.03.2011 As on 31.03.2010
Provision Coverage Ratio 61.53% 70.96%

As per RBI guidelines, all banks were required to attain Provision Coverage Ratio (PCR) of 70%
by 30.09.2010. As the PCR position had slipped below 70% as on 30.09.2010, bank had written
to RBI seeking extension of time upto 30.09.2011 for attaining PCR of 70% and the same has
been granted by RBI. Subsequently, RBI has clarified that the PCR of 70% is to be reckoned with
reference to Gross NPA position as on 30.09.2010 and the additional requirement to take the PCR
to 70% is to be segregated into an account styled “counter cyclical provisioning buffer”.
Accordingly, bank is required to build counter cyclical provision buffer of ` 178.4 Million. Bank
will be building this buffer by 30.09.2011.

10.9 Overseas Assets, NPAs and Revenue

(` in Million)
Particulars 31.03.2011 31.03.2010
Total Assets (Deposits with banks outside
403.6 416.2
India)
Total NPAs Nil Nil
Total Revenues (Interest on Deposits with
0.1 0.4
banks outside India)

F-63
 10.10 Off-balance Sheet SPVs sponsored

Nil.

10.11 Income from Bancassurance

(` in Million)
Sl.No. Nature of Income 2010-11 2009-10
1. From Selling Life Insurance Policies 28.64 76.45
2. From Selling Non Life Insurance Policies 3.74 3.33
3. From Selling Mutual Fund Products 0.29 0.90
4. Others Nil Nil
5. Total 32.67 80.68

11. Comparative Figures

Previous year’s figures have been regrouped and recast wherever necessary to conform to current
year’s classification.

F-64
NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2011-12

1. General

1.1 Capital Funds

a) During the year, the Bank has raised Tier II capital amounting to ` 418.0 Million by
issue of Lower Tier II bonds.

b) As per the directions of Reserve Bank of India , SVG Group (presently holding 18.09
% of the paid up share Capital of the bank as on 31.03.2012) was required to divest
shares in excess of 10% of the Paid up Capital before 31.03.2012. This divestment has
not been completed.

c) Calls in arrears (including premium) of ` 14.2 Million is pending in respect of the right
issues of the bank for earlier years. The bank had given several extensions/notices to the
respective shareholders. Steps are being taken for forfeiting those shares.

1.2 Investments

a) The profit on sale of investments under Held to Maturity category amounting to `

8.8 Million (previous year ` 12.2 Million) has been taken to Profit and Loss
account and a sum of ` 4.5 Million (previous year ` 6.1 Million), being net of
taxes and net of transfer to Statutory Reserve of such profit, has been appropriated
to Capital Reserve Account.

b) In respect of Investments in Held to Maturity category, the amount of

amortisation of excess of acquisition cost over face value is ` 147.2 Million
(previous year ` 137.1 Million) which is netted against Income on Investments

c) Excess provisions on depreciation in the Available for Sale category of

investments amounting to ` 19.0 Million (previous year ` 0.9 Million) has been
credited to Profit & Loss Account. Out of the above, an amount of ` 9.6 Million
net of taxes and net of transfer to Statutory Reserves (previous year ` 0.5 Million)
has been appropriated to Investment Reserve.

d) Further provisions on depreciation on investments in the Available for Sale

category investments amounting to ` 13.9 Million (previous year ` 2.6 Million) is
debited to Profit & Loss account. An equivalent amount of ` 7.0 Million, net of
taxes and net of transfer to Statutory Reserve, (previous year ` 1.3 Million) has
been transferred from Investment Reserve Account to Profit and Loss Account
and the same has been appropriated to General Reserve in line with RBI
guidelines.

e) During 2011-12, the bank has not transferred any securities from Held to Maturity
to Available for Sale category (previous year Nil).

F-65
1 .3 Reconciliation

Reconciliation of inter-bank and inter-branch transactions has been completed up to 31st

March 2012. Steps for elimination of outstanding entries are in progress. Since the
outstanding entries to be eliminated are insignificant, no material consequential effect is
anticipated.

1.4 Taxation

a) In respect of appeals filed by the Bank, no provision is considered necessary

for the disputed income tax liability of ` 154.9 Million on the basis of
favourable judicial decisions and legal opinion.

b) Tax liability on account of Minimum Alternative Tax (MAT) has been

recognized as a liability and as an asset to the extent of MAT credit
entitlement in line with Guidance Note on Accounting of Credit Available in
respect of Minimum Alternative Tax under the Income Tax Act, 1961, issued
by ICAI.

2. Disclosures in terms of Reserve Bank of India Guidelines

2.1 Capital

Particulars 31.03.2012 31.03.2011

i)CRAR (%) – Basel II 11.14 11.28
ii) CRAR - Tier I capital (%) 8.89 9.48
iii) CRAR - Tier II Capital (%) 2.25 1.80
iv)Amount of subordinated debt raised ` 1335.0 Million ` 917.0 Million
as Tier-II capital
v)Amount raised by issue of IPDI Nil Nil
vi) Amount raised by issue of Upper Nil Nil
Tier II instruments

F-66
2.2 Investments

(` in Million)
Items 31.03.2012 31.03.2011
(1) Value of Investments
(i) Gross Value of Investments 31474.46 26930.69
(a) In India 31474.46 26930.69
(b) Outside India, Nil Nil
(ii) Provisions for Depreciation 23.00 28.11
(a) In India 23.00 28.11
(b) Outside India, Nil Nil
(iii) Net Value of Investments 31451.46 26902.58
(a) In India 31451.46 26902.58
(b) Outside India. Nil Nil
(2) Movement of provisions held towards
depreciation on investments
(i) Opening balance 28.1 26.6
(ii) Add: Provisions made during the year 13.9 2.6

(iii) Less: Write-off/ write-back of excess 19.0 0.9

provisions during the year
(iv) Less: Provision Account debited Nil 0.2
during the year
(v) Closing balance 23.0 28.1

2.2.1 Repo Transactions

(In Face Value terms)
(` in Million)
Minimum Maximum
Daily Average
outstanding outstanding Outstanding as
outstanding
during the during the on 31.03.2012
during the year
year year

Securities sold under repo

i. Government Securities Nil 3000 635.5 2750
Ii Corporate debt securities Nil Nil Nil Nil
Securities purchased under reverse repo

i. Government Securities Nil 550 12.2 Nil

Ii Corporate debt securities Nil Nil Nil Nil

F-67
2.2.2 Non-SLR Investment Portfolio

i) Issuer composition of Non SLR investments

(` in Million)
No. Issuer Amount Extent of Extent of Extent of Extent of
Private ‘Below ‘Unrated’ ‘Unlisted’
Placement Investment Securities Securities
Grade’
Securities
(1) (2) (3) (4) (5) (6) (7)
(i) PSUs 330.8 50.0 Nil Nil Nil
(ii). FIs 50.0 50.0 Nil Nil 0.00
(iii). Banks 894.2 110.0 Nil Nil 0.00
(iv). Private 59.4 7.9 7.8 Nil 7.9
Corporate
(v). Subsidiaries/ Nil Nil Nil Nil Nil
Joint
Ventures
(vi). Others 2219.4 Nil Nil Nil Nil
(RIDF, RHF,
MSME
Fund)
(vii). Provision (11.3) Nil Nil Nil Nil
held towards
depreciation
Total 3542.5 217.9 7.8 0.00 7.9

2.2.3 Sale and transfers to/from HTM Category

The value of sales from HTM category in 2011-12 constituted 3.08 per cent of the book value of
investments held in HTM category at the beginning of the year.

2.3. Derivatives

2.3.1 Forward Rate Agreement/ Interest Rate Swap: Nil

2.3.2 Exchange Traded Currency and Interest Rate Derivatives: Nil

2.3.3 Disclosures on risk exposure in derivatives

Qualitative & Quantitative Disclosure: Nil

F-68
2.4. Asset Quality

2.4.1 Non-Performing Asset

(` in Million)
Particulars 31.03.2012 31.03.2011

(i) Net NPAs to Net Advances (%) 1.10% 1.74%

(ii) Movement of NPAs (Gross)
(a) Opening balance 1924.5 1492.9
(b) Additions during the year 1002.0 1078.7
(c) Reductions during the year 1097.2 647.1
(d) Closing balance 1829.3 1924.5
(iii) Movement of Net NPAs
(a) Opening balance 1084.0 705.2
(b) Additions during the year 449.9 938.1
(c) Reductions during the year 691.8 559.3
(d) Closing balance 842.1 1084.0
(iv) Movement of provisions for NPAs (excluding
provisions on standard assets)
(a) Opening balance 806.6 752.3
(b) Provisions made during the year 140.4 85.5
(c) Write-off/ write-back of excess 166.4 31.2
provisions
(d) Closing balance 780.6 806.6

2.4.2 Particulars of Accounts Restructured

(` in Million)
CDR Mechanism SME Debt Restructuring Others
Balance Outstanding Balance Outstanding Balance Outstanding

Restructured All Accounts Restructured All Restructure All

Accounts of the Accounts Accounts d Accounts Accounts of
Borrower of the the
Borrower Borrower

Standard No.of
Borrowers #3 3 Nil Nil 87 110
advances
Restructured Amount
Outstanding
* 1236.9 1289.9 Nil Nil 2167.8 3046.4
Sacrifice 8.3
(diminution in 73.5 73.5 Nil Nil 8.3
the fair value)
Sub standard No.of
Borrowers Nil Nil Nil Nil 5 5
advances
Restructured Amount
Outstanding Nil Nil Nil Nil 14.3 14.3

F-69
 Sacrifice
(diminution in Nil Nil Nil Nil 0.6 0.6
the fair value)
Doubtful No. of 17
Borrowers Nil Nil Nil Nil 17
advances
Restructured Amount
Outstanding Nil Nil Nil Nil 42.3 60.9
Sacrifice
(diminution in Nil Nil Nil Nil 0.1 0.1
the fair value)
TOTAL No. of
Borrowers
3 3 Nil Nil 109 132
Amount
Outstanding
1236.9 1289.9 Nil Nil 2224.4 3121.6
Sacrifice
(diminution in 73.5 73.5 Nil Nil 9.0 9.0
the fair value)

*Includes cumulative redeemable preference shares of value ` 7.8 Million

#Includes one account restructured by CDR cell on 01/06/2012 with cut off date as on 01.10.2011, for which Letter of
Approval is awaited.
2.4.3 Details of financial assets sold to Securitisation / Reconstruction Company for
Asset Reconstruction
2011-12 2010-11
(i) No. of accounts 58 2

(ii) Aggregate value (net of 54.1 Nil

provisions) of accounts sold to
SC/RC (` in Million)
(iii) Aggregate consideration (` in 179.0 107.5
Million)
(iv) Additional consideration Nil Nil
realized in respect of accounts
transferred in earlier years
(v) Aggregate gain/loss over net 124.9 107.5
book value (` in Million)

2.4.4 Details of non-performing financial assets purchased/sold from/to other banks

Nil.

2.4.5 Provisions on Standard Assets

(` in Million)

Particulars 31.03.2012 31.03.2011

Provisions held towards Standard Assets 338.0 229.0

F-70
2.5 Business Ratio

Particulars 31.03.2012 31.03.2011

(i) Interest Income as a percentage to Working Funds (%) 9.97 8.68

(ii Non-interest income as a percentage to Working Funds (%) 0.79 0.85

(iii) Operating Profit as a percentage to Working Funds (%) 0.87 0.52

(iv) Return on Assets (%) 0.24 0.23

(v) Business (Deposits plus advances) per employee 67.71 53.96
(` Million)
(vi) Profit per employee (` Million) 0.10 0.07

F-71
2.6 Asset Liability Management

Maturity pattern of certain items of assets and liabilities (as compiled by the management and relied upon by the auditors)

(` in Million)
As on 31.03.2012 Day 1 2-7 Days 8 - 14 Days 15 to 28 29 days to 3 Over 3 Over 6 Over 1 year & Over 3 years & Over 5 Total
days months months & up months & up up to 3 years up to 5 years years
to 6 months to 1 year
Deposits 272.90 668.70 877.80 2155.30 4578.80 8557.40 8360.30 26852.37 1175.80 52549.33 106048.70
Advances 1678.70 1240.20 1706.10 2578.00 4595.90 7480.40 13609.40 33119.40 6215.93 4411.40 76635.43
Investments 0.00 889.70 681.80 490.00 588.50 659.00 218.70 4085.40 3500.80 20337.56 31451.46
Borrowings 0.00 2980.27 0.00 0.00 160.00 128.16 128.16 1903.58 36.48 418.00 5754.65
Foreign Currency
assets 445.30 0.00 3.05 0.00 519.43 282.35 92.59 0.68 0.68 167.89 1511.97
Foreign Currency
liabilities 42.36 0.00 27.90 26.86 171.77 232.26 308.01 317.72 58.48 0.00 1185.36

Note: Deposits have been classified as per behavioural maturity.

F-72
2.7 Exposures

2.7.1 Exposure to Real Estate Sector (` in Million)

Category 31.03.2012 31.03.2011
a) Direct exposure
(i) Residential Mortgages
a) Priority sector 2684.8 2776.6
b) Non priority sector 920.8 970.7
( Of which staff housing loans) ( 692.0) (697.6)
c) Total 3605.6 3747.3
(ii) Commercial Real Estate 2679.6 2761.2
(iii) Investments in Mortgage Backed
Securities (MBS) and other securitised
exposures –
a. Residential, Nil Nil
b. Commercial Real Estate. Nil Nil
b) Indirect Exposure
Fund based and non fund based exposures on Nil Nil
National Housing Bank (NHB) and Housing
Finance Companies (HFCs)

Total Exposure to Real Estate Sector 6285.2 6508.5

2.7.2 Exposure to Capital Market (` in Million)

Sl 31.03.2012 31.03.2011
No Items
Direct investment in equity shares, convertible bonds, convertible debentures 1.3 84.2
1 and units of equity oriented mutual funds the corpus of which is not
exclusively invested in corporate debt
Advances against shares/bonds/debentures of other securities or on clean 1.8 3.2
basis to individuals for investment in shares (including IPOs/ESOPs),
2
convertible bonds, convertible debentures and units of equity oriented mutual
funds
Advances for any other purposes where shares or convertible bonds or 0.1 0.1
3 convertible debentures or units of equity oriented mutual funds are taken as
primary security
Advances for any other purposes to the extent secured by the collateral
Nil Nil
security of shares or convertible bonds or convertible debentures or units of
4 equity oriented mutual funds i.e. where the primary security other than
shares/convertible bonds/convertible debentures/units of equity oriented
mutual funds does not fully cover the advances
Secured and unsecured advances to stock brokers and guarantees issued on 5.0 4.9
5
behalf of stock brokers and market makers
Loans sanctioned to corporate against the security of
shares/bonds/debentures or other securities or on clean basis for meeting Nil Nil
6 promoter’s contribution to the equity of new companies in anticipation of
raising resources

F-73
 7 Bridge loans to companies against expected equity flows/issues Nil Nil
Underwriting commitments taken up by the banks in respect of primary issue Nil Nil
8 of shares or convertible bonds or convertible debentures or units of equity
oriented mutual funds
9 Financing to stock brokers for margin trading Nil Nil
10 All exposures to Venture Capital Funds Nil Nil
Total Exposure to Capital Market 8.2 92.4

2.7.3 Risk category wise country exposure

(` in Million)
Risk Category Exposure (Net) Provision held as Exposure (Net) Provision held
as at 31.03.2012 at 31.03.2012 as at 31.03.2011 as at 31.03.2011
Insignificant 875.6 Nil 899.8 Nil
Low 224.2 Nil 170.3 Nil
Moderate 24.3 Nil 13.8 Nil
High Nil Nil Nil Nil
Very High Nil Nil Nil Nil
Restricted Nil Nil Nil Nil
Off-Credit Nil Nil Nil Nil
Total 1124.1 Nil 1083.9 Nil

The bank is not having exposure to any country where the net funded exposure is 1 percent or
more of the total assets and hence no provisioning is necessary for country risk, in accordance
with the RBI guidelines.

2.7.4 Details of Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by
the bank.

Total Exposure as on 31.03.2012

Sl No Name of Borrower
(` in Million)

1 Ajmer Vidyut Vitran Nigam Limited 1113.5

2 TANGEDCO 866.9

2.7.5 Unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights, licenses,
authorisation etc. are available to the bank is Nil.

F-74
2.8 Miscellaneous

2.8.1 Amount of Provisions made for Income-tax during the year

(` in Million)
31.03.2012 31.03.2011

Provision for Income Tax net of MAT credit entitlement 36.6 92.87
(including Deferred Tax & wealth tax)

2.8.2 Disclosure of Penalties imposed by RBI

Nil.

3. Disclosures as per Accounting Standards where RBI has issued Guidelines in respect of
items for ‘Notes to Accounts’

3.1 Accounting Standard 5 – Net Profit or Loss for the period, Prior Period Items and
Changes in Accounting Policies
There are no material prior period income/expenditure requiring disclosure.

3.2 Accounting Standard 9 – Revenue Recognition

Income/Expenditure of certain items are recognized on cash basis the effect of which on the
financial statements are not considered to be material.

3.3 Accounting Standard 15 (Revised) – Accounting for Employee Benefits in the Financial
Statements of Employers
During financial year 2010-11, the bank re opened pension for those employees who had not
opted for the pension scheme earlier. Further during the same year the limit of gratuity payable
to the employees was also enhanced pursuant to the amendment to the Payment of Gratuity Act,
1972. In accordance with the RBI Circular DBOD.No.BP.BC.15896/21.04.018/2010-11 dated
April 08, 2011 the Bank had amortized the pension and enhanced gratuity (in the cases
mentioned above) for a period of 5 years commencing from 31.03.2011. Accordingly ` 121.0
Million (representing 1/5th of ` 604.8 Million (Pension ` 397.4 Million and Gratuity ` 207.4
Million) has been charged to the Profit and Loss account during the year. The balance amount
carried forward for future amortization is ` 362.8 Million. Had such a circular not been issued
by the RBI and accounting had been done in terms of Accounting Standard 15, the profit after
tax of the Bank for the year would have been higher by ` 81.7 Million and Reserves and Surplus
would have been lower by ` 245.1Million

F-75
3.3.1 Disclosures for Defined Contribution Plans – Provident Fund & New Pension Scheme
(Contributory)
Contributions to employee provident fund and new pension scheme (contributory), debited to
Profit & Loss Account during the year amount to ` 14.9 Million (previous year ` 65.8 Million).
There is no deficit in the Income & Expenditure of the provident fund (previous year ` 5.0
Million, which was charged to Profit & Loss account).
3.3.2 Disclosures for Defined Benefit Plans – Pension, Gratuity & Long term
Compensated Absences (Privilege Leave)

3.3.2.1 Amount recognised in Balance Sheet and Profit & Loss Account
The amount recognised in the balance sheet is as follows:
(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2011-12 2010-11 2011-12 2010-11 2011-12 2010-11

Present Value of Obligations -
2226.0 2185.6 775.2 838.3 428.4 394.9
Closing
Fair Value of Plan Assets - Closing 1481.5 1685.6 581.4 563.3 N.A. N.A.
Funded Status 744.5 500.0 193.8 275.0 428.4 394.9
Unrecognised Actuarial Gains Nil Nil Nil Nil Nil Nil
Less Amount unamortised and
carried forward as per RBI circular
DBOD.No.BP. BC. 238.4 317.9 124.4 165.9 N.A. N.A.
15896/21.04.018/2010-11 dated
April 08, 2011
Net Liability recognised in Balance
Sheet (included in Other Liabilities 506.1 182.1 69.4 109.1 428.4 394.9
& Provisions)

F-76
The amount recognised in the statement of profit and loss account is as follows:
(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2011-12 2010-11 2011-12 2010-11 2011-12 2010-11

Current Service Cost 520.0 532.5 39.1 38.0 20.3 16.1
Past Service Cost N.A. N.A. N.A. 207.4 N.A. N.A.
Interest Cost 160.3 51.6 64.3 44.3 29.4 25.5
Expected Return on Plan Assets (143.3) (45.9) (47.9) (46.9) N.A. N.A.
Net Actuarial Loss/(Gain)
14.1 1046.1 13.9 47.2 81.2 59.1
recognised in the year
Amount unamortised and carried
N.A. (317.9) N.A. (165.9) N.A. N.A.
forward as per RBI circular
Contribution of New Pension
N.A. (971.5) N.A. N.A. N.A. N.A.
Optees
Total, (included in “Payment to
and provisions for employees” of 551.1 294.9 69.4 124.1 130.9 100.7
Operating Expenses)

3.3.2.2 Changes in Fair Value of Plan Assets

(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)
2011-12 2010-11 2011-12 2010-11 2011-12 2010-11
Fair Value of Plan Assets at the
1685.6 574.1 563.3 587.0 N.A. N.A.
beginning of the year
Expected Return on Plan Assets 143.3 45.9 47.9 46.9 N.A. N.A.
Contributions 306.6 1269.5 150.6 27.1 97.4 48.9
Benefits Paid 599.3 228.6 164.7 89.9 97.4 48.9
Actuarial (Loss)/Gain (54.7) 24.7 (15.7) (7.8) N.A. N.A.
Fair Value of Plan Assets at the end of
1481.5 1685.6 581.4 563.3 N.A. N.A.
the year

F-77
3.3.2.3 Changes in Present Value of Obligations (` in Million)
Long term
Compensated
Pension Gratuity
Absences (Privilege
Leave)

2011-12 2010-11 2011-12 2010-11 2011-12 2010-11

Present Value of Obligations at the

2185.6 759.2 838.3 599.1 394.9 343.2
beginning of the year
Interest Cost 160.3 51.6 64.3 44.3 29.4 25.5
Current Service Cost 520.0 532.5 39.1 38.0 20.3 16.1
Past Service Cost N.A. N.A. N.A. 207.4 N.A. N.A.
Benefits Paid 599.3 228.6 164.7 89.9 97.4 48.9
Actuarial Loss/(Gain) (40.6) 1070.9 (1.8) 39.4 81.2 59.0
Present Value of Obligations at the
2226.0 2185.6 775.2 838.3 428.4 394.9
end of the year

3.3.2.4 Movement in Net Liability Recognised in Balance Sheet

(` in Million)
Long term
Compensated
Pension Gratuity
Absences (Privilege
Leave)
2011-12 2010-11 2011-12 2010-11 2011-12 2010-11
Net Liability at the beginning of
182.1 185.1 109.1 12.1 394.9 343.2
the period
Add Expenses Charged to Profit &
630.6 294.9 110.9 124.1 130.9 100.7
Loss Account
Less Contributions 306.6 297.9 150.6 27.1 97.4 48.9
Net Liability at the end of the
506.1 182.1 69.4 109.1 428.4 395
period

3.3.2.5 Actual Return on Plan Assets

(` in Million)

Long term
Compensated
Pension Gratuity
Absences (Privilege
Leave)

2011-12 2010-11 2011-12 2010-11 2011-12 2010-11

Expected Return on Plan Assets 143.3 45.9 47.9 46.9 N.A. N.A.
Actuarial Gain (Loss) (54.6) 24.7 (15.7) (7.8) N.A. N.A.
Actual Return on Plan Assets 88.7 70.6 32.2 39.1 N.A. N.A.

F-78
3.3.2.6 Actuarial Assumptions
Long term
Compensated
Pension Gratuity
Absences (Privilege
Leave)
2011-12 2010-11 2011-12 2010-11 2011-12 2010-11
Discount Rate (p.a.) 8.50% 8.00% 8.50% 8.00% 8.50% 8.00%
Expected Return on Plan
8.00% 8.00% 8.00% 8.00% N.A. N.A.
Assets (p.a.)
Future Salary Increases
5.00% 5.00% 5.00% 5.00% 5.00% 5.00%
(p.a.)
Mortality In accordance with In accordance with In accordance with
the standard table the standard table the standard table
LIC (1994-96). LIC (1994-96). LIC (1994-96).
3.3.2.7 Investment Percentage maintained by Pension & Gratuity Trust
Pension Gratuity
As on As on As on As on
31.03.2012 31.03.2011 31.03.2012 31.03.2011
Life Insurance Companies
32.20% 34.77% 13.33% 0.00%

Central Govt. Securities 18.46% 17.10% 33.16% 39.03%

State Govt. Securities 9.31% 11.13% 21.10% 22.55%
Other Trust Securities
(PSU)/Deposits with 40.03% 37.00% 32.41% 38.42%
Banks etc.
Total 100.00% 100.00% 100.00% 100.00%

3.3.2.8 Experience Adjustments

(` in Million)
Pension Gratuity
2011-12 2010-11 2011-12 2010-11
On Benefit Obligation (Gain+/Loss-) -89.3 -1140.6 -36.5 +12.8
On Plan Assets (Gain+/Loss-) +51.1 +12.9 -8.0 -1.3

3.3.2.9 Expected Contributions

Bank’s best estimates of contributions to the funds in 2012-13 are as follows:
Pension: ` 600 Million
Gratuity: ` 100 Million

F-79
3.3.3 Other Long term Employee Benefits
As on 31.03.2012 the Bank holds provision of ` 3.03 Million (previous year ` 2.73 Million)
towards provision for Leave Fare Concession based on actuarial valuation.
3.4 Accounting Standard 17 – Segment Reporting
Part A: Business Segments

(` in Million)
Business Treasury Corporate/Wholesal Retail Banking Other Banking Total
Segments e Banking Business
2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11 2011-12 2010-11
Revenue 2187.84 1653.76 3951.46 2488.25 5312.57 4075.28 156.08 148.45 11607.95 8365.74
Result (873.38) (869.33) 804.29 553.25 994.08 749.36 12.14 20.90 937.13 454.18
Unallocated
expenses Nil Nil
Operating profit 937.13 454.18
Provisions other 640.09 161.58
than tax
Provision for 36.60 92.87
Tax
Extraordinary
profit/ loss Nil Nil
Net profit 260.44 199.73
OTHER
INFORMATION
Segment assets 31934.33 24314.65 31354.74 29562.15 49873.17 38097.66 20.07 30.22 113182.31 92004.68
Unallocated 6571.76 5591.96
assets
Total assets 119754.07 97596.64
Segment 3304.20 1277.79 32892.73 25547.16 81137.69 68847.31 146.72 267.35 117481.34 95939.61
liabilities
Unallocated 2272.73 1657.04
liabilities
Total liabilities 119754.07 97596.64

Part B: Geographic segments

The Bank has no branches outside India.

3.5 Accounting Standard 18 – Related Party disclosures

Key Management Personnel: Shri.V.P.Iswardas, Managing Director & Chief Executive Officer

3.6 Accounting Standard 19 – Leases

The Properties taken on lease/rental basis are renewable/cancellable at the option of the Bank

3.7 Accounting Standard 21 - Consolidated Financial Statements

Not Applicable.

F-80
3.8 Accounting Standard 22 – Accounting for Taxes on Income
Net Deferred Tax Asset as on 31.03.2012, computed in compliance with the Accounting
Standard 22 on Accounting for Taxes on Income, amounts to ` 288.8 Million..

Components of Net Deferred Tax Asset as on 31.03.2012 are as follows:

(` in Million)
31.03.2012 31.03.2011
Deferred Tax Asset
Provision for Employee Benefits (Leave Benefits) 149.2 138.3

Provision for Standard Assets 109.7 74.3

Carry Forward Loss Nil 83.5
Counter Cyclical Provisioning Buffer 46.5 Nil
Others 34.6 9.8
Total Deferred Tax Asset 340.0 305.9
Deferred Tax Liability
Depreciation on Fixed Assets 40.1 43.2
Net Deferred Tax Asset 299.9 262.7
Add/Less Effect of Restatement (11.1) (10.4)
Net Deferred Tax Asset after restatement 288.8 252.3

3.9 Accounting Standard 23 – Accounting for Investments in Associates in Consolidated

Financial Statements
Not Applicable
3.10 Accounting Standard 24 - Discontinuing operations
Not Applicable

3.11 Accounting Standard 25 – Interim Financial Reporting

Bank has complied with the disclosures in connection with the half yearly review prescribed by RBI.

4 Other Accounting Standards

4.1 Accounting for Fixed Assets (AS 10)

a) The land and buildings owned by the Bank were revalued in 1990-91, 1993-94, 1998-99,
2004-05, 2006-07 and 2007-08 and appreciation credited to Revaluation Reserve. Depreciation
for the year on the net addition to value on such revaluation of assets of ` 6.0 Million (previous
year ` 6.4 Million) has been transferred from Revaluation Reserve to Profit and Loss Account.

b) Bank had sold one of its premises in 2011-12 and the amount standing in Revaluation Reserve
relating to that asset (` 1.5 Million) has been transferred to General Reserve in line with
paragraph 14.4 of AS 10.

F-81
4.2 Effect of Changes in Foreign Exchange Rates (AS 11)

The net profit for the year is arrived at after charging the amount of exchange differences due to
translation of monetary assets and liabilities at the closing rates.

4.3 Accounting Standard 20 – Earnings per Share

Particulars 2011-12 2010-11

EPS-Basic/Diluted (`) 6.99 6.43
Amount used as numerator- Profit after Tax (` in Million) 260.44 199.72
Nominal value per Equity Share (`) 10 10
Weighted Average Number of Equity Shares used as
denominator 37272385 31074926

4.4 Intangible Assets (Accounting Standard 26)

The bank has complied with AS 26 (Intangible Assets) and the disclosures required under the
Standard are as follows:
` in Million)
(`
31.03.2012 31.03.2011

a) Acquired Application Software

Opening Balance at cost 46.3 42.2
Add Additions during the year 5.5 4.1
Less Disposals during the year Nil Nil
Less Amortisation to date 34.3 26.2
Net Carrying Amount* 17.5 20.1
b) Internally Generated Software
Opening Balance at cost 78.5 78.5
Add Additions during the year 4.1 Nil
Less Disposals during the year Nil Nil
Less Amortisation to date 63.1 48.9
Net Carrying Amount* 19.5 29.6
Total Carrying Amount 37.0 49.7

*The Net carrying amount of acquired application software and internally generated
application software are included in– Other Assets.

4.5 Impairment of Assets (Accounting Standard 28)

In the opinion of the Bank’s management, there is no material impairment to the fixed assets as
at 31.03.2012 requiring recognition in terms of Accounting Standard 28 – Impairment of Assets.

F-82
 4.6 Provisions, Contingent Liabilities and Contingent Assets (AS-29)

Movements in significant provision heads have been disclosed at appropriate places in the Notes
forming part of the accounts.

5. Additional Disclosures as per RBI Guidelines

5.1 Details of provisions and contingencies debited in Profit and Loss Account during the
year

(` in Million)
31.03.2012 31.03.2011
a Provisions towards NPA/write offs & Counter Cyclical *459.80 134.16
Provision
b Add back of eligible amount of provision held in respect Nil (4.62)
of Agricultural Debts Waived
c Depreciation and write off of investments 13.90 2.56
d Add back of excess provision for Depreciation on (19.02) (1.00)
investments
e Provision for Income tax (Including Deferred Tax and 36.60 92.87
Wealth Tax)
f Provision for Standard Assets 109.04 36.86
g Provision for diminution on Restructured Advances 63.85 (4.80)
h Other provisions 12.52 (1.58)
Total 676.69 254.45
* includes ` 143.5 Million debited to P&L for creation of Counter cyclical provisioning buffer.

5.2 Floating Provisions

a) Opening Balance in floating provisions account Nil
b) Quantum of floating provisions made in the accounting year Nil
c) Purpose & amount of draw down made during the accounting year Nil
d) Closing balance in floating provisions account Nil

5.3 Draw Down from Reserves

Nil

F-83
5.4 Disclosure of complaints

A. Customer Complaints

a) No. of complaints pending at the beginning of the year 6

b) No. of complaints received during the year 167
c) No. of complaints redressed during the year 160
d) No. of complaints pending at the end of the year 13

B. Awards passed by the Banking Ombudsman

a) No. of unimplemented Awards at the beginning of the year Nil

b) No. of Awards passed by the Banking Ombudsmen during the year Nil
c) No. of Awards implemented during the year Nil
d) No. of unimplemented Awards at the end of the year Nil

5.5 Disclosure of Letter of Comforts (LOCs) issued by banks

Not applicable since the bank has no subsidiaries.

5.6 Provisioning Coverage Ratio

As on As on 31.03.2011
31.03.2012
Provisioning Coverage Ratio 61.92% 61.53%

In accordance with the guidelines issued by RBI vide their circular no

DBOD.BP.BC.87/21.04.048/2010-11 dated April 21, 2011, bank was required to build a Counter
Cyclical Provisioning Buffer of ` 178.4 Million, which has been done as on 30.09.2011.

5.7 Income from Bancassurance

(` in Million)
Sl.No. Nature of Income 2011-12 2010-11
1. From Selling Life Insurance Policies 22.0 28.7
2. From Selling Non Life Insurance Policies 4.7 3.7
3. From Selling Mutual Fund Products 0.8 0.3
4. Others Nil Nil
5. Total 27.5 32.7

F-84
5.8 Concentration of Deposits, Advances, Exposures and NPAs

5.8.1 Concentration of Deposits

As on As on
31.03.2012 31.03.2011

Total Deposits of twenty largest depositors (` in Million) 14799.4 12482.5

Percentage of Deposits of twenty largest depositors to Total Deposits of 13.97% 14.31%

the bank

5.8.2 Concentration of Advances

As on As on
31.03.2012 31.03.2011
Total Advances to twenty largest borrowers (` in Million) 12109.3 12200.9

Percentage of Advances to twenty largest borrowers to Total Advances of 13.35% 16.80%

the bank

5.8.3 Concentration of Exposures

As on As on
31.03.2012 31.03.2011
Total Exposures to twenty largest borrowers/customers (` in Million) 12145.8 12200.9

Percentage of Exposures to twenty largest borrowers/customers to Total 13.26% 16.58%

Exposure of the bank on borrowers/customers

5.8.4 Concentration of NPAs

As on As on
31.03.2012 31.03.2011
Total Exposures to top four NPA Accounts (` in Million) 402.0 377.4

F-85
5.9 Sector wise NPAs

Sl.No. Sector Percentage of NPAs to Total Advance in that

Sector
As on 31.03.2012 As on 31.03.2011
1. Agriculture & allied activities 0.60% 1.11%
2. Industry (Micro & small, 2.68% 6.34%
Medium and Large)
3. Services 2.29% 4.14%
4. Personal Loans 0.82% 1.51%

5.10 Movement of NPA

(` in Million)
Particulars 2011-12 2010-11
Opening Balance of Gross NPA 1924.5 1492.9
Additions (Fresh NPAs) during the year 1002.0 1078.7
Sub-total (A) 2926.5 2571.6
Less:-
(i) Upgradations 135.1 212.3
(ii) Recoveries (excluding recoveries made from upgraded 628.3 347.3
accounts)
(iii) Write-offs 333.9 87.5
Sub-total (B) 1097.3 647.1
Closing balance of Gross NPA (A – B) 1829.2 1924.5

5.11 Overseas Assets, NPAs and Revenue

(` in Million)
Particulars 31.03.2012 31.03.2011
Total Assets (Deposits with banks outside India) 409.1 403.6
Total NPAs Nil Nil
Total Revenues (Interest on Deposits with banks outside 0.10 0.10
India)
5.12 Off-balance Sheet SPVs sponsored
(which are required to be consolidated as per accounting norms)
Nil
5.13 Unamortised Pension and Gratuity Liabilities
(` in Million)
Particulars 2011-12 2010-11
Unamortised Pension Liability 238.4 317.9
Unamortised Gratuity Liability 124.4 165.9
Total 362.8 483.8

6. Comparative Figures
Previous year’s figures have been regrouped and recast wherever necessary to conform to current
year’s classification.

F-86
NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2012-13

1. General
1.1 Capital Funds

a) In FY 2012-13 the bank has successfully completed the issue of shares on Rights basis, which was
oversubscribed by 121.38%. On March 31, 2013, the Bank allotted 10461781 equity shares of ` 10 each at a
premium of ` 65 per share. Consequently, the Paid up Capital and Share Premium Account of the Bank have
been increased by ` 104.6 Million and ` 680.0 Million respectively.

b) As per the directions of Reserve Bank of India , SVG Group (holding 18.11 % of the paid up share
Capital of the bank as on 31.03.2013) was required to divest shares in excess of 10% of the Paid up Capital
before 31.03.2013. On March 26, 2013, the group had received approval of Reserve Bank of India for
transfer of 4.98 % of their holdings as on the date of the letter. Since their divestment has not been
completed as per the limit prescribed by RBI, the group has sought extension of time upto June 30, 2013 for
the same.

1.2 Investments

a) The profit on sale of investments under Held to Maturity category amounting to ` 160.7 Million
(previous year ` 8.80 Million) has been taken to Profit and Loss account and a sum of ` 81.4 Million
(previous year ` 4.50 Million), being net of taxes and net of transfer to Statutory Reserve of such
profit, has been appropriated to Capital Reserve Account.

b) In respect of Investments in Held to Maturity category, the amount of amortisation of excess of

acquisition cost over face value is ` 148.4 Million (previous year ` 147.2 Million) which is netted
against Income on Investments

c) Provision for depreciation on investments in the Available for Sale category amounting to ` 12.7
Million is debited to the Profit & Loss Account (Previous year ` 15.1 Million is credited to Profit &
Loss Account). An equivalent amount of ` 6.40 Million (net of taxes and net of transfer to Statutory
Reserves has been transferred from Investment Reserve to Profit & Loss Account and the same has
been appropriated to General Reserve in line with RBI guidelines (previous year ` 2.60 Million has
been transferred to Investment Reserve Account from Profit & Loss Account).

d) During 2012-13, the bank has not transferred any securities between categories. (previous year Nil).

1 .3 Reconciliation
Reconciliation of inter-bank and inter-branch transactions has been completed up to 31st March 2013. Steps
for elimination of outstanding entries are in progress. Since the outstanding entries to be eliminated are
insignificant, no material consequential effect is anticipated.

1.4 Taxation
Claims against the bank not acknowledged as debt under contingent liabilities include disputed income tax
liabilities of ` 100.6 Million which has been paid/adjusted and included under other assets. In respect of
these claims, provision for tax is not considered necessary based on various judicial decisions on such
disputes. Management does not envisage any liability in respect of such disputed issues.

Provision for income tax for the year is arrived at after due consideration of the various judicial decisions on
certain disputed issues.

F-87
2. Disclosures in terms of Reserve Bank of India Guidelines
2.1 Capital

Particulars 31.03.2013 31.03.2012

i)CRAR (%) – Basel II 12.19 11.14
ii) CRAR - Tier I capital (%) 9.52 8.89
iii) CRAR - Tier II Capital (%) 2.67 2.25
iv)Amount of subordinated debt raised as Tier-II capital(` in 1175.0 1335.0
Million)
v)Amount raised by issue of IPDI Nil Nil
vi) Amount raised by issue of Upper Tier II instruments Nil Nil

2.2 Investments
(` in Million)
Items 31.03.2013 31.03.2012
(1) Value of Investments
(i) Gross Value of Investments 33046.20 31474.46
(a) In India 33046.20 31474.46
(b) Outside India, Nil Nil
(ii) Provisions for Depreciation 35.68 23.00
(a) In India 35.68 23.00
(b) Outside India, Nil Nil
(iii) Net Value of Investments 33010.52 31451.46
(a) In India 33010.52 31451.46
(b) Outside India. Nil Nil
(2) Movement of provisions held towards depreciation on
investments
(i) Opening balance 23.0 28.1
(ii) Add: Provisions made during the year 26.3 13.9
(iii) Less: Write-off/ write-back of excess provisions during the 13.6 19.0
year
(iv) Closing balance 35.7 23.0

2.2.1 Repo Transactions

(In Face Value terms)
(` in Million)
Daily
Minimum Maximum
Average Outstanding
outstanding outstanding
outstanding as on
during the during the
during the 31.03.2013
year year
year
Securities sold under repo
i. Government Securities Nil 2750 607.9 Nil
ii Corporate debt securities Nil Nil Nil Nil
Securities purchased under
reverse repo
i. Government Securities Nil 200 12.2 Nil
ii Corporate debt securities Nil Nil Nil Nil

F-88
2.2.2 Non-SLR Investment Portfolio

i) Issuer composition of Non SLR investments

(` in Million)
No. Issuer Amount Extent of Extent of Extent of Extent of
Private ‘Below ‘Unrated’ ‘Unlisted’
Placement Investment Securities Securities
Grade’
Securities
(1) (2) (3) (4) (5) (6) (7)
(i) PSUs 330.7 30 Nil Nil Nil
(ii). FIs 40 40 Nil Nil Nil
(iii). Banks 1438 649.9 Nil Nil Nil
(iv). Private
136.2 84.7 7.8 40 47.9
Corporate
(v). Subsidiaries/
Joint Ventures Nil Nil Nil Nil Nil

(vi). Others
1552.7 Nil Nil Nil Nil
(RIDF, RHF,
MSME Fund)
(vii). Provision held
towards (35.7) Nil Nil Nil Nil
depreciation
Total 3461.9 804.6 7.8 40 47.9

ii) Non performing Non-SLR investments

(` in Million)
Particulars 31.03.2013 31.03.2012
Opening balance Nil Nil
Additions during the year Nil Nil
Reductions during the above period Nil Nil
Closing balance Nil Nil
Total provisions held Nil Nil

2.2.3 Sale and transfers to/from HTM Category

The value of sales from HTM category in 2012-13 exceeds 5% of the book value of investments held in HTM
category at the beginning of the year requiring the following disclosures:
(` in Million)
Market value of investments held in the HTM Category : 28747.2

Excess of book value over market value for which provision is 886.7
not required to be made as per RBI guidelines

F-89
2.3. Derivatives: Nil

2.3.1 Forward Rate Agreement/ Interest Rate Swap: Nil

2.3.2 Exchange Traded Currency and Interest Rate Derivatives: Nil

2.3.3 Disclosures on risk exposure in derivatives: Nil

Qualitative & Quantitative Disclosure: Not Applicable

2.4. Asset Quality

2.4.1 Non-Performing Asset

(` in Million)
Particulars 31.03.2013 31.03.2012

(i) Net NPAs to Net Advances (%) 1.12% 1.10%

(ii) Movement of NPAs (Gross)
(a) Opening balance 1829.3 1924.5
(b) Additions during the year 1713.1 1002.0
(c) Reductions during the year 1433.8 1097.2
(d) Closing balance 2108.6 1829.3
(iii) Movement of Net NPAs
(a) Opening balance 842.1 1084.0
(b) Additions during the year 1426.9 449.9
(c) Reductions during the year 1276.5 691.8
(d) Closing balance 992.5 842.1
(iv) Movement of provisions for NPAs (excluding
provisions on standard assets)
(a) Opening balance 780.6 806.6
(b) Provisions made during the year 391.8 140.4
(c) Write-off/ write-back of excess 262.2 166.4
provisions
(d) Closing balance 910.2 780.6

F-90
2.4.2 Particulars of Accounts Restructured/Rescheduled as on 31.03.2013
(` in Million)
Sl.
Type of Under SME Debt Restructuring
No Under CDR Mechanism Others Total
Restructuring Mechanism
.

Sub- Sub- Dou Sub-

Standar Dou Stand Doubtf Los Standar Sub- Doubtf
Asset classification stan Loss Total Stand btfu Loss Total Standard Standar Total Loss Total
d btful ard ul s d standard ul
dard ard l d

Details

No. of
3 - - - 3 - - - - - 87 5 17 - 109 90 5 17 - 112
Restructured borrowers
Accounts as on
Amount
1 April 1 of the 1236.9 - - - 1236.9 - - - - - 2167.8 14.3 42.3 - 2224.4 3404.7 14.3 42.3 - 3461.3
outstanding
FY (opening
figure) Provision
73.5 - - - 73.5 - - - - - 8.3 0.6 0.1 - 9 81.8 0.6 0.1 - 82.5
thereon

No. of
4 - - - 4 - - - - - 14 - - - 14 18 - - - 18
borrowers
Fresh
Amount
2 restructuring 1489.1 - - - 1489.1 - - - - - 822.3 - - - 822.3 2311.4 - - - 2311.4
outstanding
during the year.
Provision
134.7 - - - 134.7 - - - - - 7 - - - 7 141.7 - - - 141.7
thereon

No. of
- - - - - - - - - - - - - - - - - - - -
Upgradations to borrowers
restructured
Amount
3 standard - - - - - - - - - - - - - - - - - - - -
outstanding
category during
the FY. Provision
- - - - - - - - - - - - - - - - - - - -
thereon
Restructured No. of
standard 1 - - - 1 - - - - - 52 - - - 52 53 - - - 53
borrowers
4 advances which
cease to attract Amount
59.1 - - - 59.1 - - - - - 316.7 - - - 316.7 375.8 - - - 375.8
higher outstanding

F-91
 provisioning
and / or
additonal risk
weight at the
end of the FY
and hence need Provision
7.8 - - - 7.8 - - - - - 4.9 - - - 4.9 12.7 - - - 12.7
not be shown as thereon
restructured
standard
advances at the
beginning of
the next FY.
No. of
- - - - - - - - - - - 1 - - 1 - 1 - - 1
borrowers
Downgradation
s of retructured Amount
5 - - - - - - - - - - - 1.6 - - 1.6 - 1.6 - - 1.6
accounts during outstanding
the FY.
Provision
- - - - - - - - - - - 0.078 - - 0.078 - 0.078 - - 0.078
thereon

Write-offs of No. of
- - - - - - - - - - - - - - - - - - - -
restructured borrowers
6
accounts during Amount
the FY. - - - - - - - - - - - - - - - - - - - -
outstanding

No. of
7 - - - 7 - - - - - 84 6 14 - 104 91 6 14 - 111
borrowers
Restructured
acounts as on Amount
7 March 31 of the 2715.4 - - - 2715.4 - - - - - 2786.7 29.3 22.2 - 2838.2 5502.1 29.3 22.2 - 5553.6
outstanding
FY (closing
figures*)
Provision
142.5 - - - 142.5 - - - - - 12.8 0.57 0.035 - 13.4 155.3 0.57 0.035 - 155.9
thereon
*Excluding the figures of Standard Restructured Advances which do not attract higher provisioning or risk weight (if
applicable)
*Includes one restructured standard advance with outstanding balance of ` 728.3 Millions for which formalities like issuance of State Government guarantee, execution of individual documentation as required under
restructuring scheme are in progress

F-92
2.4.3 Details of financial assets sold to Securitisation / Reconstruction Company for
Asset Reconstruction
2012-13 2011-12
(i) No. of accounts Nil 58
(ii) Aggregate value (net of provisions) of accounts sold to Nil 54.1
SC/RC (` in Million)
(iii) Aggregate consideration (` in Million) Nil 179.0
(iv) Additional consideration realized in respect of accounts Nil Nil
transferred in earlier years
(v) Aggregate gain/loss over net book value (` in Million) Nil 124.9

2.4.4 Details of non-performing financial assets purchased/sold from/to other banks

Nil.

2.4.5 Provisions on Standard Assets

(` in Million)

Particulars 31.03.2013 31.03.2012

Provisions held towards Standard Assets 464.7 338.0

2.5 Business Ratio

Particulars 31.03.2013 31.03.2012

(i) Interest Income as a percentage to Working Funds 10.27 9.97

(ii) Non-interest income as a percentage to Working Funds 0.74 0.79

(iii) Operating Profit as a percentage to Working Funds 0.72 0.87

(iv) Return on Assets (%) 0.21 0.24

(v) Business (Deposits plus advances) per employee 74.04 67.71
(` in Million)
(vi) Profit per employee (` in Million) 0.09 0.10

F-93
2.6 Asset Liability Management

Maturity pattern of certain items of assets and liabilities (as compiled by the management and relied upon by the auditors)

(` in Million)
As on 31.03.2013 Day 1 2-7 Days 8 - 14 Days 15 to 28 29 days to 3 Over 3 Over 6 Over 1 year & Over 3 years Over 5 Total
days months months & up months & up up to 3 years & up to 5 years
to 6 months to 1 year years
Deposits 469.30 1017.00 1060.20 2006.00 4236.80 8219.60 12491.20 31789.26 1914.90 60212.00 123416.26
Advances 910.50 1288.50 2095.90 2283.60 6599.30 13374.30 15756.40 36359.00 5191.70 4655.98 88515.18
Investments 0.00 0.00 497.10 0.00 1425.00 100.30 224.70 5135.30 2610.00 23018.12 33010.52
Borrowings 0.00 0.00 0.00 0.00 0.00 128.16 136.48 1311.42 0.00 418.00 1994.06
Foreign Currency
assets 429.34 5.87 88.07 73.48 628.17 295.61 3.95 1.26 18.61 179.14 1723.50
Foreign Currency
liabilities 109.54 6.10 13.14 11.16 54.58 137.66 302.06 349.64 112.71 0.00 1096.59

Note: Deposits have been classified as per behavioural maturity.

F-94
2.7 Exposures

2.7.1 Exposure to Real Estate Sector (` in Million)

(As compiled by the management and relied upon by the auditors)
Category 31.03.2013 31.03.2012
a) Direct exposure
(i) Residential Mortgages
a) Priority sector 2552.7 2684.8
b) Non priority sector 1037.2 920.8
( Of which staff housing loans) (706.7) (692)
c) Total
3589.9 3605.6
(ii) Commercial Real Estate 3205.9 2679.6
(iii) Investments in Mortgage Backed
Securities (MBS) and other securitised
exposures – Nil Nil
a. Residential, Nil Nil
b. Commercial Real Estate. Nil Nil
b) Indirect Exposure Nil Nil
Fund based and non fund based exposures on Nil Nil
National Housing Bank (NHB) and Housing
Finance Companies (HFCs)

Total Exposure to Real Estate Sector 6795.8 6285.2

2.7.2 Exposure to Capital Market (` in Million)

(As compiled by the management and relied upon by the auditors)
Sl 31.03.2013 31.03.2012
No Items
Direct investment in equity shares, convertible bonds, convertible debentures 1.3 1.3
1
and units of equity oriented mutual funds the corpus of which is not
exclusively invested in corporate debt
Advances against shares/bonds/debentures of other securities or on clean
basis to individuals for investment in shares (including IPOs/ESOPs), 1.4 1.8
2
convertible bonds, convertible debentures and units of equity oriented mutual
funds
Advances for any other purposes where shares or convertible bonds or
3 convertible debentures or units of equity oriented mutual funds are taken as 0.1 0.1
primary security
Advances for any other purposes to the extent secured by the collateral
security of shares or convertible bonds or convertible debentures or units of
Nil Nil
4 equity oriented mutual funds i.e. where the primary security other than
shares/convertible bonds/convertible debentures/units of equity oriented
mutual funds does not fully cover the advances
Secured and unsecured advances to stockbrokers and guarantees issued on 6.4 5
5
behalf of stockbrokers and market makers
Loans sanctioned to corporate against the security of Nil Nil
shares/bonds/debentures or other securities or on clean basis for meeting
6
promoter’s contribution to the equity of new companies in anticipation of
raising resources

F-95
 7 Bridge loans to companies against expected equity flows/issues Nil Nil
Underwriting commitments taken up by the banks in respect of primary issue Nil Nil
8 of shares or convertible bonds or convertible debentures or units of equity
oriented mutual funds
9 Financing to stock brokers for margin trading Nil Nil
10 All exposures to Venture Capital Funds Nil Nil
Total Exposure to Capital Market 9.2 8.2

2.7.3 Risk category wise country exposure (As compiled by the management and relied upon by the
auditors)
(` in Million)
Risk Category Exposure (Net) as Provision held Exposure (Net) as at Provision held as
at 31.03.2013 as at 31.03.2012 at 31.03.2012
31.03.2013
Insignificant 432.7 Nil 875.6 Nil
Low 131 Nil 224.2 Nil
Moderate 28.5 Nil 24.3 Nil
High 4.8 Nil Nil Nil
Very High Nil Nil Nil Nil
Restricted Nil Nil Nil Nil
Off-Credit Nil Nil Nil Nil
Total 597 Nil 1124.1 Nil

The bank is not having exposure to any country where the net funded exposure is 1 percent or more of the
total assets and hence no provisioning is necessary for country risk, in accordance with the RBI guidelines.

2.7.4 Details of Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by the bank.
(` in Million)
Sl No Name of Borrower Total Exposure as on 31.03.2013
1 Ajmer Vidyut Vitran Nigam Limited 1356
2 TANGEDCO 1086.6

2.7.5 Unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights, licenses,
authorisation etc. are available to the bank is Nil.

2.8 Miscellaneous
Amount of Provisions made for Income-tax during the year
(` in Million)
31.03.2013 31.03.2012

Provision for Income Tax (including Deferred Tax & wealth 61.29 36.6
tax)

F-96
2.8.1 Disclosure of Penalties imposed by RBI

Nil.

3. Disclosures as per Accounting Standards where RBI has issued Guidelines in respect of items for
‘Notes to Accounts’

3.1 Accounting Standard 5 – Net Profit or Loss for the period, Prior Period Items and Changes in
Accounting Policies
There are no material prior period income/expenditure requiring disclosure.

3.2 Accounting Standard 9 – Revenue Recognition

Income of certain items are recognized on cash basis the effect of which on the financial statements are not
considered to be material.

3.3 Accounting Standard 15 (Revised) –Employee Benefits

During financial year 2010-11, the bank re opened pension for those employees who had not opted for the
pension scheme earlier. Further during the same year the limit of gratuity payable to the employees was also
enhanced pursuant to the amendment to the Payment of Gratuity Act, 1972. In accordance with the RBI
Circular DBOD.No. BP. BC.80/21.04.018/2010-11 dated February 9, 2011 and RBI Letter
DBOD.No.BP.BC.15896/21.04.018/2010-11 dated April 08, 2011 the Bank had amortized the pension and
enhanced gratuity (in the cases mentioned above) for a period of 5 years commencing from 31.03.2011.
Accordingly ` 121.0 Million (representing 1/5th of ` 604.8 Millions (Pension ` 397.4 Million and Gratuity
` 207.4 Million)) has been charged to the Profit and Loss account during the year. The balance amount
carried forward for future amortization is ` 241.9 Million. Had such a circular not been issued by the RBI
and accounting had been done in terms of Accounting Standard 15, the profit after tax of the Bank for the
year would have been higher by ` 81.7 Million and Reserves and Surplus would have been lower by ` 163.3
Million.

3.3.1 Disclosures for Defined Contribution Plans – Provident Fund & New Pension Scheme
(Contributory)
Contributions to employee provident fund and new pension scheme (contributory), debited to Profit & Loss
Account during the year amount to ` 20.2 Million (previous year ` 14.9 Million). There is no deficit in the
Income & Expenditure of the provident fund (previous year also no deficit).

F-97
3.3.2 Disclosures for Defined Benefit Plans – Pension, Gratuity & Long term Compensated Absences
(Privilege Leave)
3.3.2.1 Amount recognised in Balance Sheet and Profit & Loss Account
The amount recognised in the balance sheet is as follows:
(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2012-13 2011-12 2012-13 2011-12 2012-13 2011-12

Present Value of Obligations -
Closing 2491 2226 813 775.2 528.3 428.4

Fair Value of Plan Assets - Closing 1700.1 1481.5 655.7 581.4 N.A. N.A.
Funded Status 790.9 744.5 157.3 193.8 528.3 428.4
Unrecognised Actuarial Gains Nil Nil Nil Nil Nil Nil
Less Amount unamortised and
carried forward as per RBI letter
DBOD.No.BP. BC. 158.9 238.4 83 124.4 N.A. N.A.
15896/21.04.018/2010-11 dated
April 08, 2011
Net Liability recognised in Balance
Sheet (included Other Liabilities & 632 506.1 74.3 69.4 528.3 428.4
Provisions)

The amount recognised in the statement of profit and loss account is as follows:
(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2012-13 2011-12 2012-13 2011-12 2012-13 2011-12

Current Service Cost 518.5 520 34.6 39.1 30.5 20.3
Past Service Cost N.A. N.A. N.A. N.A. N.A. N.A.
Interest Cost 166.2 160.3 61.5 64.3 33.3 29.4
Expected Return on Plan Assets (125.9) (143.3) (49.4) (47.9) N.A. N.A.
Net Actuarial Loss/(Gain)
recognised in the year 73.2 14.1 27.6 13.9 109.3 81.2

Total, (included in “Payment to

and provisions for employees” of 632 551.1 74.3 69.4 173.1 130.9
Operating Expenses)

F-98
3.3.2.2 Changes in Fair Value of Plan Assets
(` in Million)
Long term
Pension Gratuity Compensated Absences
(Privilege Leave)
2012-13 2011-12 2012-13 2011-12 2012-13 2011-12
Fair Value of Plan Assets at the
beginning of the year 1481.5 1685.6 581.4 563.3 N.A. N.A.

Expected Return on Plan Assets 125.9 143.3 49.4 47.9 N.A. N.A.
Contributions 585.6 306.6 110.9 150.6 73.2 97.4
Benefits Paid 541.6 599.3 102.5 164.7 73.2 97.4
Actuarial (Loss)/Gain 48.7 (54.6) 16.5 (15.7) N.A. N.A.
Fair Value of Plan Assets at the end of
the year 1700.1 1481.5 655.7 581.4 N.A. N.A.

3.3.2.3 Changes in Present Value of Obligations (` in Million)

Long term Compensated

Pension Gratuity Absences (Privilege
Leave)

2012-13 2011-12 2012-13 2011-12 2012-13 2011-12

Present Value of Obligations at the

beginning of the year 2226 2185.6 775.2 838.3 428.4 394.9

Interest Cost 166.2 160.3 61.5 64.3 33.3 29.4

Current Service Cost 518.5 520 34.6 39.1 30.5 20.3
Past Service Cost N.A. N.A. N.A. N.A. N.A. N.A.
Benefits Paid 541.6 599.3 102.5 164.7 73.2 97.4
Actuarial Loss/(Gain) 121.9 (40.6) 44.1 (1.8) 109.3 81.2
Present Value of Obligations at the
end of the year 2491 2226 812.9 775.2 528.3 428.4

3.3.2.4 Movement in Net Liability Recognised in Balance Sheet

(` in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)
2012-13 2011-12 2012-13 2011-12 2012-13 2011-12
Net Liability at the beginning of the
period 506.1 182.1 69.4 109.1 428.4 394.9

Add Expenses Charged to Profit &

Loss Account 711.5 630.6 115.8 110.9 173.1 130.9

Less Contributions 585.6 306.6 110.9 150.6 73.2 97.4

Net Liability at the end of the period 632 506.1 74.3 69.4 528.3 428.4

F-99
3.3.2.5 Actual Return on Plan Assets
(` in Million)

Long term Compensated

Pension Gratuity Absences (Privilege
Leave)

2012-13 2011-12 2012-13 2011-12 2012-13 2011-12

Expected Return on Plan Assets 125.9 143.3 49.4 47.9 N.A. N.A.
Actuarial Gain (Loss) 48.7 (54.6) 16.5 (15.7) N.A. N.A.
Actual Return on Plan Assets 174.6 88.7 65.9 32.2 N.A. N.A.

3.3.2.6 Actuarial Assumptions

Long term Compensated
Pension Gratuity Absences (Privilege
Leave)
2012-13 2011-12 2012-13 2011-12 2012-13 2011-12
Discount Rate (p.a.) 8.50% 8.50% 8.50% 8.50% 8.50% 8.50%
Expected Return on Plan Assets (p.a.) 8.50% 8.00% 8.50% 8.00% N.A. N.A.
Future Salary Increases (p.a.) 5.00% 5.00% 5.00% 5.00% 5.00% 5.00%
In accordance with the In accordance with the In accordance with the
Mortality standard table LIC standard table LIC standard table LIC (1994-
(1994-96). (1994-96). 96).

3.3.2.7 Investment Percentage maintained by Pension & Gratuity Trust

Pension Gratuity
As on As on As on As on
31.03.2013 31.03.2012 31.03.2013 31.03.2012
Life Insurance Companies 47.12% 32.20% 31.49% 13.33%
Central Govt. Securities 16.70% 18.46% 28.75% 33.16%
State Govt. Securities 12.30% 9.31% 13.79% 21.10%
Other Trust Securities
23.88% 40.03% 25.97% 32.41%
(PSU)/Deposits with Banks etc.
Total 100.00% 100.00% 100.00% 100.00%
3.3.2.8 Experience Adjustments (` in Million)

Pension Gratuity
2012-13 2011-12 2012-13 2011-12
On Benefit Obligation (Gain+/Loss-) -121.9 -89.3 -44.1 -36.5
On Plan Assets (Gain+/Loss-) +48.7 +51.1 +16.5 -8

F-100
 3.3.2.9 Expected Contributions
Bank’s best estimates of contributions to the funds in 2013-14 are as follows:
Pension: ` 1500 Million
Gratuity: ` 200 Million

3.3.3 Other Long term Employee Benefits

a) As on 31.03.2013 the Bank holds provision of ` 3.8 Million (previous year ` 3.03 Million) towards
provision for Leave Fare Concession based on actuarial valuation.
3.4 Accounting Standard 17 – Segment Reporting (As compiled by the management and relied upon by
the auditors)

Part A: Business Segments

(` in Million)
Business Corporate/Wholesale Other Banking
Treasury Retail Banking Total
Segments Banking Business
2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12 2012-13 2011-12
Revenue 2767.89 2187.84 3865.00 3951.46 7378.92 5312.57 142.49 156.08 14154.30 11607.95
Result (943.22) (873.38) 549.99 804.29 1291.08 994.08 30.45 12.14 928.30 937.13
Unallocated
expenses Nil Nil
Operating profit 928.30 937.13
Provisions other
600.84 640.09
than tax
Provision for Tax 61.29 36.60
Extraordinary
profit/ loss Nil Nil
Net profit 266.17 260.44
OTHER
INFORMATION
Segment assets 35800.46 31934.33 29465.11 31354.74 62901.32 49873.17 19.13 20.07 128186.02 113182.31
Unallocated
6300.32 6571.76
assets
Total assets 134486.34 119754.07
Segment liabilities 304.05 3304.20 45022.87 32892.73 86426.49 81137.69 183.64 146.72 131937.05 117481.34
Unallocated
2549.29 2272.73
liabilities
Total liabilities 134486.34 119754.07

Part B: Geographic segments

The Bank has no branches outside India.

3.5 Accounting Standard 18 – Related Party disclosures

Name of the Party Nature of Relationship
Sri.V.P.Iswardas Key Management Personnel (Up to the completion
of the term of office on 29.11.2012 )
Note: In accordance with the RBI Guidelines on compliance with Accounting Standards by the Banks, the
details of transactions with Key Management Personnel have not been disclosed since there is only one
entity in the respective category of the related party.

F-101
3.6 Accounting Standard 22 – Accounting for Taxes on Income
Net Deferred Tax Asset as on 31.03.2013, computed in compliance with the Accounting Standard 22 on
Accounting for Taxes on Income, amounts to ` 421.54 Million
Components of Net Deferred Tax Asset as on 31.03.2013 are as follows:

(` in Million)
31.03.2013 31.03.2012
Deferred Tax Asset
Provision for Employee Benefits 180.9 149.2
Provision for Standard Assets 158 109.7
Counter Cyclical Provisioning Buffer 42.7 46.5
Others 61.3 34.6
Total Deferred Tax Asset 442.9 340
Deferred Tax Liability
Depreciation on Fixed Assets 41.2 40.1
Net Deferred Tax Asset 401.7 299.9
Add/Less Effect of Restatement 19.8 (11.1)
Net Deferred Tax Asset after restatement 421.5 288.8

3.7 Accounting Standard 25 – Interim Financial Reporting

Bank has complied with the disclosures in connection with the half yearly review prescribed by RBI.

4 Other Accounting Standards

4.1 Accounting for Fixed Assets (AS 10)

a) The land and buildings owned by the bank were revalued in 1990-91,1993-94,1998-99, 2004-05,2006-
07,2007-08 & 2012-13 and appropriation credited to revaluation reserve. During the year, the land and
buildings owned by the Bank were revalued as on 30.06.2012 by approved valuer and the resultant
appreciation of ` 891.8 Million has been credited to Revaluation Reserve.
b) Depreciation for the 12 month period on the net addition to value on revaluation of assets of ` 12.3
Million has been transferred from Revaluation Reserve to Profit and Loss Account.

4.2 Effect of Changes in Foreign Exchange Rates (AS 11)

The net profit for the year is arrived at after charging the amount of exchange differences due to translation
of monetary assets and liabilities at the closing rates.

4.3 Accounting Standard 19 – Leases

The Properties taken on lease/rental basis are renewable/cancelable at the option of the Bank.

F-102
4.4 Accounting Standard 20 – Earnings per Share

The Bank reports basic and diluted earnings per equity share in accordance with (AS) 20, “Earnings per
share” prescribed by the Companies (Accounting Standards) Rules, 2006. Basic Earnings per share (EPS)
reported is computed by dividing net profit after tax by the weighted average number of equity shares
outstanding for the period. Diluted earnings per equity share have been computed using the weighted
average number of equity shares and dilutive potential equity shares outstanding during the period except
where the results are anti dilutive.
Particulars 2012-13 2011-12 *
EPS-Basic/Diluted (`) 7.13 6.99
Amount used as numerator- Profit after Tax (` in Million) 266.17 260.44
Nominal value per Equity Share (`) 10 10
Weighted Average Number of Equity Shares used as
denominator 37309480 37272385

* Earnings per Share for previous year has been recast in the light of rights issue of 2012-13 in line with the
relevant provisions of AS 20

4.5 Intangible Assets (Accounting Standard 26)

The bank has complied with AS 26 (Intangible Assets) and the disclosures required under the Standard are
as follows:
` in Million)
(`
31.03.2013 31.03.2012

a) Acquired Application Software

Opening Balance at cost 51.8 46.3
Add Additions during the year 6.6 5.5
Less Disposals during the year Nil Nil
Less Amortisation to date 42.4 34.3
Net Carrying Amount* 16.0 17.5
b) Internally Generated Software
Opening Balance at cost 82.6 78.5
Add Additions during the year 7.9 4.1
Less Disposals during the year Nil Nil
Less Amortisation to date 76.2 63.1
Net Carrying Amount* 14.3 19.5
Total Carrying Amount 30.3 37.0

*The Net carrying amount of acquired application software and internally generated application
software are included in Other Assets.

4.6 Impairment of Assets (Accounting Standard 28)

In the opinion of the Bank’s management, there is no material impairment to the fixed assets as at
31.03.2013 requiring recognition in terms of Accounting Standard 28 – Impairment of Assets.

F-103
4.7 Provisions, Contingent Liabilities and Contingent Assets (AS-29)

Movements in significant provision heads have been disclosed at appropriate places in the Notes forming
part of the accounts.

4.7.1 Description of Contingent Liabilities

a) Claims against the bank not acknowledged as debts

These represent claims filed against the Bank in the normal course of business relating to various legal cases
currently in progress.

b) Guarantee given on behalf of constituents

As a part of its banking activities, the Bank issues guarantees on behalf of its customers to enhance their
credit standing. Guarantees represent irrevocable assurances that the Bank will make payments in the event
of the customer failing to fulfill its financial or performance obligation.

b) Acceptances, endorsements and other obligations

These include documentary credit issued by the bank on behalf of its customers and bills drawn by the
Bank’s customers and accepted or endorsed by the Bank.

5. Additional Disclosures as per RBI Guidelines

5.1 Details of provisions and contingencies debited in Profit and Loss Account during the year
(` in Million)
31.03.2013 31.03.2012
a Provisions towards NPA/write offs & Counter Cyclical 391.82 *459.80
Provision
b Add back of eligible amount of provision held in respect of Nil Nil
Agricultural Debts Waived
c Depreciation and write off of investments 12.69 (5.12)
d Provision for Income tax (Including Deferred Tax and 61.29 36.60
Wealth Tax)
e Provision for Standard Assets 126.69 109.04
f Provision for diminution on Restructured Advances 73.41 63.85
g Other provisions (3.77) 12.52
Total 662.13 676.69
* includes 14.35 Cr debited to P&L for creation of Counter cyclical provisioning buffer.

5.2 Floating Provisions

a) Opening Balance in floating provisions account Nil
b) Quantum of floating provisions made in the accounting year Nil
c) Purpose & amount of draw down made during the accounting year Nil
d) Closing balance in floating provisions account Nil

5.3 Draw Down from Reserves

Nil

F-104
 5.4 Disclosure of complaints

A. Customer Complaints

a) No. of complaints pending at the beginning of the year 13

b) No. of complaints received during the year 107
c) No. of complaints redressed during the year 119
d) No. of complaints pending at the end of the year 1

B. Awards passed by the Banking Ombudsman

a) No. of unimplemented Awards at the beginning of the year Nil

b) No. of Awards passed by the Banking Ombudsmen during the year Nil
c) No. of Awards implemented during the year Nil
d) No. of unimplemented Awards at the end of the year Nil

5.5 Disclosure of Letter of Comforts (LOCs) issued by banks

Not applicable since the bank has no subsidiaries.

5.6 Provisioning Coverage Ratio

As on
As on 31.03.2013
31.03.2012
Provisioning Coverage Ratio 63.28% 61.92%
5.7 Income from Bancassurance
(` in Million)
Sl.No. Nature of Income 2012-13 2011-12
1. From Selling Life Insurance Policies 3.4 22
2. From Selling Non Life Insurance Policies 5.2 4.7
3. From Selling Mutual Fund Products 0.4 0.8
4. Others Nil Nil
5. Total 9 27.5

5.8 Concentration of Deposits, Advances, Exposures and NPAs

5.8.1 Concentration of Deposits
As on
As on 31.03.2013
31.03.2012
Total Deposits of twenty largest depositors (` in Million) 20370.4 14799.4
Percentage of Deposits of twenty largest depositors to Total
16.51% 13.97%
Deposits of the bank
5.8.2 Concentration of Advances
As on 31.03.2013 As on 31.03.2012
Total Advances to twenty largest borrowers (` in Million) 11806.5 12109.3
Percentage of Advances to twenty largest borrowers to Total
11.53% 13.35%
Advances of the bank

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5.8.3 Concentration of Exposures

As on As on
31.03.2013 31.03.2012
Total Exposures to twenty largest borrowers/customers (` in Million) 11883.3 12145.8
Percentage of Exposures to twenty largest borrowers/customers to
11.50% 13.26%
Total Exposure of the bank on borrowers/customers

5.8.4 Concentration of NPAs

(` in Million)
As on As on
31.03.2013 31.03.2012
Total Exposures to top four NPA Accounts 532.6 402.0

5.9 Sector wise NPAs

Percentage of NPAs to Total
Advance in that Sector
Sl.No. Sector
As on As on
31.03.2013 31.03.2012
1. Agriculture & allied activities 1.13% 0.60%
2. Industry (Micro & small, Medium and Large) 1.30% 2.68%
3. Services 1.99% 2.29%
4. Personal Loans 0.47% 0.82%

5.10 Movement of NPA

(` in Million)
Particulars 2012-13 2011-12
Opening Balance of Gross NPA 1829.3 1924.5
Additions (Fresh NPAs) during the year 1713.1 1002
Sub-total (A) 3542.4 2926.5
Less:- 0 0
(i) Upgradations 652.9 135.1
(ii) Recoveries (excluding recoveries made from upgraded 525.2 628.2
accounts)
(iii) Write-offs 255.7 333.9
Sub-total (B) 1433.8 1097.2
Closing balance of Gross NPA (A – B) 2108.6 1829.3

5.11 Overseas Assets, NPAs and Revenue

(` in Million)
Particulars 31.03.2013 31.03.2012
Total Assets (Deposits with banks outside India) 384.7 409.1
Total NPAs Nil Nil
Total Revenues (Interest on Deposits with banks outside India) 0.1 0.1

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5.12 Off-balance Sheet SPVs sponsored
( which are required to be consolidated as per accounting norms)
Nil
5.13 Unamortised Pension and Gratuity Liabilities
(` in Million)
Particulars 2012-13 2011-12
Unamortised Pension Liability 158.9 238.4
Unamortised Gratuity Liability 83 124.4
Total 241.9 362.8

5.14 Disclosure on Remuneration

Qualitative (a) Information relating to the composition and mandate of the
disclosures Remuneration Committee.

Composition

The Remuneration Committee of the Board consist of three members,

of which one member is from Risk Management committee of the
Board. All the members of the Committee are independent directors.

Function and mandate

The Remuneration Committee of the Board would oversee framing,

review and implementation of the compensation policy on behalf of the
Board. The Committee would ensure that the cost/income ratio of the
bank supports the remuneration package consistent with maintenance of
sound capital adequacy ratio.

(b) Information relating to the design and structure of remuneration

processes and the key features and objectives of remuneration policy.

Process
The Remuneration Committee works in close co-ordination with the
Risk Management Committee of the Board to review the compensation
practices every year in order to achieve effective alignment between
remuneration and risks. . The Remuneration Committee will study the
business and industry environment, analyze and categorize the risks and
streamline the components of the compensation plan like proportion of
the total variable compensation to be paid to WTD’s, MD & CEO and
Senior executives to ensure financial stability of the organization.

The Committee would also analyze various factors to ascertain whether

cost/ income ratio supports the remuneration package provided to
WTD’s, MD & CEO and Senior Executives consistent with
maintenance of sound capital adequacy ratio.

Authority to invoke clawback arrangement

F-107
 The Remuneration Committee of the Board also have the authority to
ascertain whether the decision taken by the WTD, MD& CEO, Senior
executives (above Chief General Manager) have brought forth a
negative contribution to the Bank. The Committee will be vested with
the powers to invoke the clawback arrangement, after taking into
account relevant statutory and regulatory stipulations as applicable.
Objectives
The objectives of the remuneration policy are four fold:

• To align compensation with prudent risk taken.

• To ensure effective governance of the compensation in the

organization.

• To ensure effective supervisory oversight and stakeholder

engagement in compensation.

• To attract and retain talent.

Key features
• To actively oversee the compensation systems design and
operation.

• To monitor and review the compensation system to ensure that

the system operates as intended.

• Staff engaged in financial and risk control must be independent,

have appropriate authority, and be compensated in a manner that
is independent of the business areas they oversee and
commensurate with their key role in the firm.

• Supervisory review of compensation practices must be rigorous

and sustained and deficiencies must be addressed promptly with
supervisory action.

• Firms must disclose clear comprehensive and timely

information about their compensation practices to facilitate
constructive engagement by all stakeholders.

(c) Description of the ways in which current and future risks are taken into
account in the remuneration processes. It should include the nature and
type of the key measures used to take account of these risks.

For the purpose of effectively aligning compensation structure with risk

outcomes, the functionaries in the institution are arranged under the
following four categories.

1) MD & CEO/Whole time directors

2) Senior Executives ((Risk control and compliance staff) -Non

F-108
 IBA Package
3) Senior Executives (Chief General Manger) -Non IBA Package

4) Other officers and staff -on IBA package

Clawback Arrangement/ Compensation Recovery

A clawback arrangement or a compensation recovery is provided in

the policy [WTD’s, MD & CEO and Senior Executives- above Chief
General Manager) which will entail the Bank to recover proportionate
amount of variable compensation paid to the functionaries on account
of an act or decision taken by the official which has brought forth a
negative contribution to the bank at a prospective stage. The clawback
arrangement is subject to the relevant statutory and regulatory
stipulations as applicable.

Limit on variable pay

The variable compensation offered to an official would not exceed 70%

of the total fixed compensation.

Severance pay and guaranteed bonus

Severance pay (other than gratuity or terminal entitlements or as

entitled by statute) is not paid to any official of the organization
except in those cases where it is mandatory by statute.

Sign on bonus or joining bonus is limited to the first year and is paid
only as Employee stock options.

Hedging

No compensation scheme or insurance facility would be provided by

the Bank to employees to hedge their compensation structure to offset
the risk alignment mechanism (deferral pay and clawback
arrangements) embedded in their compensation arrangement.

Committees to mitigate risks caused by an individual decision

In order to further balance the impact of market or credit risks caused to

the organization by an individual decision taken by a senior level
executive, MD & CEO or a whole time director, the bank, as a
promoted practice, has constituted various committees to take
decisions on various aspects.
Credit limits are sanctioned by committee at different levels.

Investment decisions of the Bank are taken and monitored by

Investment Committee and there is an upper limit cut in treasury
dealings where individual decisions can be taken.

F-109
 Interest rates on Asset and liability products for different buckets are
decided and monitored by the ALCO. Banks’ exposure to liquidity
risk are also monitored by ALCO.

Compensation of risk control staff

Members of staff engaged in financial and risk control would be

compensated in a manner that is independent of the business areas they
oversee and commensurate with their key role in the bank.. The mix of
fixed and variable compensation for control function personnel should
be weighted in favour of fixed compensation.

(d) Description of the ways in which the bank seeks to link performance
during a performance measurement period with levels of remuneration.

Compensation of MD & CEO, whole time directors and senior

executives (Non IBA) , performance linkage

The compensation paid out to the referred functionaries is divided into

two components

1. The fixed compensation is determined based on the industry

standards, the exposure, skill sets, talent and qualification
attained by the official over his/her career span.

2. The variable compensation for MD & CEO and senior executives

on Non – IBA package basis are fixed based on performance
and responsibility in the bank. The Bank’s performance is based
on the various financial indicators like revenue earned, cost
deployed, profit earned, NPA position and other intangible
factors like leadership and employee development. Variable
pay is paid purely based on performance.

Approval from RBI is obtained to decide compensation for whole time

directors and MD & CEO. The payment of compensation also requires
approval of the shareholders of the Bank in the General Meeting
pursuant to the Bank’s Articles of Association read with the Section
309 (1) of the Companies Act,1956.

Compensation paid to Other Officers and staff members on IBA

package

The compensation paid to other officials that include Award staff,

Officers coming under Scale I to III and Senior executives coming
under Scale IV to VII is fixed based on the periodic industry level
settlements with Indian Bank Association. The variable compensation
paid to functionaries is based on the Performance Linked incentive

F-110
 scheme which has been formulated on the basis of performance
parameters.

(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.

Deferred compensation and Performance Linkage (Non-IBA)

In the event variable compensation paid to WTD’s, MD & CEO, Senior

executives (above Chief General Manger), the deferred period should
not be less than three years. Compensation payable under deferral
arrangements should vest no faster than on a pro rata basis.

Clawback and deferral arrangements

The provisions of clawback and deferral arrangements applicable to the
referred functionaries (above Chief General Manger) are subject to
relevant statutory and regulatory stipulations as applicable.

(f) Description of the different forms of variable remuneration (i.e. cash,

shares, ESOPs and other forms) that the bank utilizes and the rationale
for using these different forms.

Bank uses an optimum mix of cash, ESOPS and variable PLI to decide
the compensation to WTD/ MD & CEO and senior executives on Non –
IBA package. This is done to align the compensation of senior staff
with their performance, risk and responsibility taken in higher
assignments. Bank has to formulate a ESOP plan/scheme.

The Officers in Scale I-VII as well as Award staff come under the
purview of IBA package that is as per the Industry wide settlements.
The variable compensation paid to functionaries is based on the
Performance Linked incentive scheme which has been formulated on
the basis of performance parameters as may be prescribed from time to
time.

F-111
 Current Year Previous Year
Quantitative (g) Number of meetings held by the 2 1
disclosures Remuneration Committee during the
(The quantitative financial year and remuneration paid ` 40,000 ` 12,000
disclosures should to its members.
only cover Whole (h) (i) Number of employees having 1 1
Time Directors / received a variable remuneration
Chief Executive award during the financial year.
Officer / Other
Risk Takers) (ii) Number and total amount of sign-
on awards made during the
financial year. Nil Nil
(iii) Details of guaranteed bonus, if
any, paid as joining / sign on
bonus Nil Nil
(iv) Details of severance pay, in
addition to accrued benefits, if
any. Nil Nil
(i) (i) Total amount of outstanding Nil Nil
deferred remuneration, split into
cash, shares and share-linked
instruments and other forms.
(ii) Total amount of deferred
remuneration paid out in the Nil Nil
financial year.
(j) Breakdown of amount of ` 1,495,000(F) ` 1,800,000(F)
remuneration awards for the
financial year to show fixed and ` 450,000(V) ` 330,000(V)
variable, deferred and non-
deferred (on payment basis).
(k) (i) Total amount of outstanding Nil Nil
deferred remuneration and
retained remuneration exposed to
ex post explicit and / or implicit
adjustments.
(ii) Total amount of reductions
during the financial year due to
ex- post explicit adjustments. Nil Nil
(iii) Total amount of reductions
during the financial year due to Nil Nil
ex- post implicit adjustments.
5.15 Disclosures relating to Securitisation
Not applicable to the Bank

5.16 Credit Default Swaps

Nil

F-112
 6.Small and Micro 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.
There have been no reported cases of delays in payments to micro and small enterprises or of interest
payments due to delays in such payments. The above is based on the information available with the Bank
which has been relied upon by the auditors.

7. Comparative Figures

Previous year’s figures have been regrouped and recast wherever necessary to conform to current year’s
classification.

F-113
NOTES ON ACCOUNTS FOR THE FINANCIAL YEAR 2013-14

1. General

1.1 Capital Funds

As per the directions of Reserve Bank of India (RBI), Siam Vidhya Group (holding 13.13% of the
paid up share Capital of the bank as on 31.03.2014) was required to divest shares in excess of
10% of the Paid up Capital before 31.12.2013. Since their divestment has not been completed
within the time limit prescribed by RBI, the Siam Vidhya Group sought extension of time from
RBI upto June 30, 2014 and with the approval of RBI ,their share holding has been brought
down to 9.98% of the paid up capital on 06.06.2014 .

1.2 Investments

a) The profit on sale of investments under Held to Maturity category amounting to 267.9
Million (previous year 160.7 Million) has been taken to Profit and Loss account and a
sum of 132.6 Million (previous year 81.4 Million), being net of taxes and net of
transfer to Statutory Reserve of such profit, has been appropriated to Capital Reserve
Account.

b) In respect of Investments in Held to Maturity category, the amount of amortisation of

excess of acquisition cost over face value is 161.4 Million (previous year 148.4
Million) which is netted against Income on Investments

c) Provision for depreciation on investments in the Available for Sale category amounting to
45.6 Million is debited to the Profit & Loss Account (Previous year 12.7 Million). As
permitted by RBI Guidelines, a sum of 15.8 Million (previous year 6.4 Million) (net of
taxes and transfer to Statutory Reserves) was transferred from investment reserve to Profit
& Loss Account.

d) During 2013-14, the bank has transferred securities from Held to Maturity category to
Available for Sale category amounting to 7747.5 Million between categories. (previous
year Nil).
1 .3 Reconciliation

Reconciliation of inter-bank and inter-branch transactions has been completed up to 31stMarch

2014. Steps for elimination of outstanding entries are in progress. Since the outstanding entries to
be eliminated are insignificant, no material consequential effect is anticipated.

1.4Taxation

Claims against the bank not acknowledged as debt under contingent liabilities include disputed
income tax liabilities of 92.1 Million (Previous Year 100.6 Million) which has been
paid/adjusted and included under other assets. In respect of these claims, provision for tax is not
considered necessary based on various judicial decisions on such disputes. Management does not
envisage any liability in respect of such disputed issues.

Provision for income tax for the year is arrived at after due consideration of the various judicial
decisions on certain disputed issues.

F-114
1.5 Wage settlement
Pending settlement of wage revision with effect from 1-11-2012, Provision of 153.9Million has
been created during the current year on the basis estimated by the management. Bank has also
created provision of 100.0Million towards expected escalation in retirement benefit costs
pursuant to such revision.

1.6 Draw Down from Counter Cyclical Provisioning Buffer

(a)In terms of RBI circular DBOD.No.BP.95/21.04.048/2013-14 Dated February 7, 2014, Banks

are permitted to utilize up to 33% of counter cyclical provisioning buffer/floating provisions held
by them as on March,2013 for making specific provisions for non-performing assets, as per the
policy approved by their Board of Directors. Accordingly the bank has utilized an amount of
58.8 Million for making specific provision for non-performing assets as per the policy approved
by the Board of Directors in this regard.
(b) Also in terms of RBI circular DBOD.BP.BC.No.98 / 21.04.132/2013-14 dated February 26,
2014, banks are permitted to use the balance of counter cyclical provisioning buffer after
adjustments made as mentioned in (a) above, for meeting any shortfall on sale of Non Performing
Assets . Accordingly the bank has utilized an amount of 94.2 Million out of the balance
remaining in counter cyclical provisioning buffer for meeting shortfall that arose on sale of Non
Performing Assets to Assets Reconstruction Company.

(c) Balance in counter cyclical provisioning buffer after aforementioned drawals is 25.4 Million.
2. Disclosures in terms of Reserve Bank of India Guidelines
2.1 Capital

Particulars BASEL III

31.03.2014
i) Common Equity Tier 1 capital ratio (%) 9.08

ii) Tier 1 Capital ratio (%) 9.08

iii) Tier 2 Capital ratio (%) 1.92

iv) Total Capital ratio (CRAR) (%) 11.00
v) Percentage of the shareholding of the Government N.A.
of India in public sector banks
Nil
vi) Amount of equity capital raised (during the year)

vii) Amount of Additional Tier 1 capital raised (during

the year) ; of which Nil
PNCPS: Nil
PDI:

viii) Amount of Tier 2 capital raised (during the year) ;

of which
Debt capital instrument: Nil
Preference Share Capital Instruments: Nil
[Perpetual Cumulative Preference Shares (PCPS) /
Redeemable Non-Cumulative Preference Shares
(RNCPS) / Redeemable Cumulative Preference
Shares (RCPS)]

F-115
 BASEL II
Particulars
31.03.2014 31.03.2013
i) Common Equity Tier 1 capital ratio (%) 9.27 9.52
ii)Tier 1 Capital ratio (%) 9.27 9.52
iii)Tier 2 Capital ratio (%) 1.98 2.67
iv)Total Capital ratio (CRAR) (%) 11.25 12.19
Nil Nil
v)Percentage of the shareholding of the Government of India in
public sector banks Nil Nil
vi)Amount of equity capital raised during the year

vii)Amount of Additional Tier 1 capital raised (during the

year); of which
PNCPS: Nil Nil
PDI: Nil Nil

viii)Amount of Tier 2 capital raised (during the year) ;

of which
Debt capital instrument: Nil Nil
Preference Share Capital Instruments: Nil Nil
[Perpetual CumulativePreference Shares (PCPS) /
Redeemable Non-CumulativePreference Shares
(RNCPS) / Redeemable CumulativePreference Shares
(RCPS)]

2.2 Investments
( in Million)
Items 31.03.2014 31.03.2013
(1) Value of Investments
(i) Gross Value of Investments 51397.84 33046.20
(a) In India 51397.84 33046.20
(b) Outside India, Nil Nil
(ii) Provisions for Depreciation 81.31 35.68
(a) In India 81.31 35.68
(b) Outside India, Nil Nil
(iii) Net Value of Investments 51316.53 33010.52
(a) In India 51316.53 33010.52
(b) Outside India. Nil Nil
(2) Movement of provisions held towards depreciation on
investments
(i) Opening balance 35.7 23.0
(ii) Add: Provisions made during the year 45.6 26.3
(iii) Less: Write-off/ write-back of excess provisions during the NIL 13.6
year
(iv) Closing balance 81.3 35.7

F-116
2.2.1Repo Transactions
(In Face Value terms)
( in Million)
Daily
Minimum Maximum
Average Outstanding
outstanding outstanding
outstanding as on
during the during the
during the 31.03.2014
year year
year
Securities sold under repo
i. Government Securities Nil 3140.0 885.9 3140.0
ii Corporate debt securities Nil Nil Nil Nil
Securities purchased under
reverse repo
i. Government Securities Nil 300.0 13.6 Nil
ii Corporate debt securities Nil Nil Nil Nil

Note: The figures relate to LAF Repo/Term Repo/Reverse Repo only. There have been no market
repo/reverse repo transactions during the year.

2.2.2 Non-SLR Investment Portfolio

i) Issuer composition of Non SLR investments
( in Million)
Extent of
Extent of ‘Below Extent of Extent of
No. Issuer Amount Private Investment ‘Unrated’ ‘Unlisted’
Placement Grade’ Securities Securities
Securities
(1) (2) (3) (4) (5) (6) (7)
(i) PSUs* 1608.1 1307.5 Nil 387.5 1307.5*
(ii). FIs 30.0 30.0 Nil Nil Nil
(iii). Banks 9530.7 2965.2 Nil Nil Nil
Private Corporate
(iv). 136.2 84.7 7.8 40.0 47.9
Subsidiaries/ Joint
(v). Ventures Nil Nil Nil Nil Nil

Others
(vi). (RIDF, RHF, 5008.8 1206.5 Nil 1206.5 1206.5
MSME Fund, SRs)
Provision held
(vii)
towards (79.5) Nil Nil Nil Nil
.
depreciation
Total 16234.3 5593.9 7.8 1634.0 2561.9
* Includes securities issued by the government of Rajasthan amounting to 171.2 Million.

F-117
 ii)Non performing Non-SLR investments
( in Million)
Particulars 31.03.2014 31.03.2013
Opening balance 0.8 0.8
Additions during the year 47.8 Nil
Reductions during the above Nil Nil
period
Closing balance 48.6 0.8
Total provisions held 48.6 Nil

Note: Previous year figures recast to confirm to current classification.

2.2.3 Sale and transfers to/from HTM Category

The value of sales during the year from HTM category exceeds 5 per cent of the book value of
investments held in HTM category at the beginning of the year requiring the following
disclosures:
( in Million)
Market value of investments held in the HTM Category : 29766.7
Excess of book value over market value for which provision is
2495.4
not required to be made as per RBI guidelines

2.3. Derivatives: Nil

2.3.1 Forward Rate Agreement/ Interest Rate Swap: Nil

2.3.2 Exchange Traded Currency and Interest Rate Derivatives: Nil

2.3.3 Disclosures on risk exposure in derivatives: Nil

2.3.4 Qualitative & Quantitative Disclosure: Not Applicable

F-118
2.4. Asset Quality

2.4.1 Non-Performing Asset

( in Million)
Particulars 31.03.2014 31.03.2013

(i) Net NPAs to Net Advances (%) 2.22% 1.12%

(ii) Movement of NPAs (Gross)
(a) Opening balance 2108.6 1829.3
(b) Additions during the year 3903.6 1713.1
(c) Reductions during the year 2676.7 1433.8
(d) Closing balance 3335.5 2108.6
(iii) Movement of Net NPAs
(a) Opening balance 992.5 842.1
(b) Additions during the year 3200.9 1426.9
(c) Reductions during the year 2261.0 1276.5
(d) Closing balance 1932.4 992.5
(iv) Movement of provisions for NPAs (excluding
provisions on standard assets)
(a) Opening balance 910.2 780.6
(b) Provisions made during the year 655.0 391.8
(c) Write-off/ write-back of excess 213.8 262.2
provisions
(d) Closing balance 1351.4 910.2

F-119
2.4.2 Particulars of Accounts Restructured/Rescheduled as on 31.03.2014

PARTICULARS OF ACCOUNTS RESTRUCTURED/RESCHEDULED AS ON 31.03.2014

( in Million)

Sl. Type of Under SME Debt Restructuring

Under CDR Mechanism Others Total
No. Restructuring Mechanism
classificatio

Doubtful

Doubtful

Doubtful

Doubtful
Standard

Standard

Standard

Standard

Standard

Standard
standard

standard
Total
Asset

Total

Total

Total
Loss

Loss

Loss

Loss
Sub-

Sub-

Sub-

Sub-
n

Details
No. of
7 - - - 7 - - - - - 84 6 14 - 104 91 6 14 - 111
borrowers
Restructured
Accounts as on
Amount
1 April 1 of the 2715.4 - - - 2715.4 - - - - - 2786.7 29.3 22.2 - 2838.2 5502.1 29.3 22.2 - 5553.6
outstanding
FY (opening
figure)
Provision
142.5 - - - 142.5 - - - - - 12.8 0.57 0.035 - 13.4 155.3 0.57 0.035 - 155.9
thereon
No. of
- - - - - - - - - - 5 - 1 - 6 5 - 1 - 6
borrowers
Fresh
Amount
2 restructuring - - - - - - - - - - 87.6 - 6.2 - 93.8 87.6 - 6.2 - 93.8
outstanding
during the year.
Provision
- - - - - - - - - - 1.1 - 0.3 - 1.4 1.1 - 0.3 - 1.4
thereon
No. of
- - - - - - - - - - 1 - - - 1 1 - - - 1
borrowers
Upgradations to
restructured
Amount
3 standard - - - - - - - - - - 0.3 - - - 0.3 0.3 - - - 0.3
outstanding
category during
the FY.
Provision
- - - - - - - - - - 0.0 - - - 0.0 0.0 - - - 0.0
thereon

F-120
 Restructured
standard No. of
10 10 10 10
advances which borrowers
cease to attract
higher
provisioning
and / or
additional risk Amount
4 weight at the 59.1 59.1 59.1 59.1
outstanding
end of the FY
and hence need
not be shown as
restructured
standard
advances at the Provision
0.6 0.6 0.6 0.6
beginning of the thereon
next FY.

No. of
- - 1 - 1 - - - - - - 1 - - 1 - 1 1 - 2
borrowers
Downgradations
of restructured Amount
5 - - 459.9 - 459.9 - - - - - - 56.4 - - 56.4 - 56.4 459.9 - 516.3
accounts during outstanding
the FY.
Provision
- - - - - - - - - - - - - - - - - - - -
thereon
No. of
Write-offs of - - - - - - - - - - - - - - - - - - - -
borrowers
restructured
6
accounts during Amount
the FY. - - - - - - - - - - - - - - - - - - - -
outstanding

No. of
5 - 1 - 6 - - - - - 67 1 12 - 80 72 1 13 - 86
borrowers
Restructured
accounts as on
Amount
7 March 31 of the 1699.9 - 459.9 - 2159.8 - - - - - 1892.2 56.4 16.2 - 1964.8 3592.1 56.4 476.1 - 4124.6
outstanding
FY (closing
figures*)
Provision
84.3 - 0.0 - 84.3 - - - - - 4.8 0.0 0.71 - 5.51 89.1 0.00 0.71 - 89.81
thereon
*Excluding the figures of Standard Restructured Advances which do not attract higher provisioning or risk weight (if applicable)

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2.4.3 Details of financial assets sold to Securitisation / Reconstruction Company for
Asset Reconstruction
( in Million)
2013-14 2012-13
(i) No. of accounts (No) 112 Nil
(ii) Aggregate value (net of provisions) of accounts sold to 1364.2 Nil
SC/RC
(iii) Aggregate consideration 1270.0 Nil
(iv) Additional consideration realized in respect of accounts Nil Nil
transferred in earlier years
(v) Aggregate gain/(loss) over net book value (94.2) Nil

2.4.4 Details of non-performing financial assets purchased/sold from/to other banks

Nil.

2.4.5 Provisions on Standard Assets

( in Million)
Particulars 31.03.2014 31.03.2013

Provisions held towards Standard Assets 428.9 464.7

2.5 Business Ratio

Particulars 31.03.2014 31.03.2013

(i)Interest Income as a percentage to Working Funds 10.25 10.27

(ii)Non-interest income as a percentage to Working Funds 0.80 0.74

(iii)Operating Profit as a percentage to Working Funds 0.69 0.72

(iv) Return on Assets (%) 0.21 0.21

(v) Business (Deposits plus advances) per employee ( 77.56 74.04
Million)
(vi) Profit per employee ( Million) 0.11 0.09

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2.6 Asset Liability Management

Maturity pattern of certain items of assets and liabilities(as compiled by the management and relied upon by the auditors)

( in Million)
As on 31.03.2014 Day 1 2-7 Days 8 - 14 Days 15 to 28 29 days to 3 Over 3 Over 6 Over 1 year & Over 3 years Over 5 Total
days months months & up months & up up to 3 years & up to 5 years
to 6 months to 1 year years
Deposits 446.59 914.97 1625.97 1827.60 6444.53 9553.98 11039.68 31038.96 3583.96 70262.37 136738.61
Advances 229.77 1058.52 1487.90 1602.04 7466.96 6802.52 18811.63 36724.75 5410.04 7479.49 87073.62
Investments 0.00 486.10 0.00 2472.40 2086.90 5401.90 4733.30 3415.40 10611.90 22108.63 51316.53
Borrowings 0.00 3340.00 0.00 400.00 100.00 977.48 283.48 36.47 418.00 0.00 5555.43
Foreign Currency
assets 957.75 19.09 28.32 13.58 111.07 103.26 36.55 18.13 180.80 0.00 1468.55
Foreign Currency
liabilities 188.83 13.15 2.60 9.84 85.53 130.30 244.96 366.81 419.15 0.00 1461.17

Note: Deposits have been classified as per behavioural maturity.

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2.7 Exposures

2.7.1 Exposure to Real Estate Sector ( in Million)

(As compiled by the management and relied upon by the auditors)
Category 31.03.2014 31.03.2013
a) Direct exposure
(i) Residential Mortgages
a) Priority sector 2411.8 2552.7
b) Non priority sector 1273.1 1037.2
( Of which staff housing loans) (710.3) (706.7)
c) Total 3684.9 3589.9
(ii) Commercial Real Estate 4072.5 3205.9
(iii) Investments in Mortgage Backed Securities (MBS) and other
securitised exposures –

a. Residential, Nil Nil

b. Commercial Real Estate. Nil Nil
b) Indirect Exposure
Fund based and non fund based exposures on National Housing Bank Nil Nil
(NHB) and Housing Finance Companies (HFCs)

Total Exposure to Real Estate Sector 7757.4 6795.8

2.7.2 Exposure to Capital Market

( in Million)
(As compiled by the management and relied upon by the auditors)
Sl 31.03.2014 31.03.2013
No Items

1 Direct investment in equity shares, convertible bonds, convertible debentures

and units of equity oriented mutual funds the corpus of which is not 1.3 1.3
exclusively invested in corporate debt
Advances against shares/bonds/debentures of other securities or on clean 1.3 1.4
basis to individuals for investment in shares (including IPOs/ESOPs),
2
convertible bonds, convertible debentures and units of equity oriented mutual
funds
Advances for any other purposes where shares or convertible bonds or Nil 0.1
3 convertible debentures or units of equity oriented mutual funds are taken as
primary security

Advances for any other purposes to the extent secured by the collateral
Nil Nil
security of shares or convertible bonds or convertible debentures or units of
4 equity oriented mutual funds i.e. where the primary security other than
shares/convertible bonds/convertible debentures/units of equity oriented
mutual funds does not fully cover the advances
5 Secured and unsecured advances to stock brokers and guarantees issued on
behalf of stock brokers and market makers 0.2 6.4

Loans sanctioned to corporate against the security of shares/bonds/debentures Nil Nil

6
or other securities or on clean basis for meeting promoter’s contribution to
the equity of new companies in anticipation of raising resources

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 7 Bridge loans to companies against expected equity flows/issues Nil Nil

8 Underwriting commitments taken up by the banks in respect of primary issue Nil

of shares or convertible bonds or convertible debentures or units of equity
oriented mutual funds Nil
9 Financing to stock brokers for margin trading Nil Nil
10 All exposures to Venture Capital Funds (both registered and unregistered) Nil Nil
Total Exposure to Capital Market 2.8 9.2

2.7.3 Risk category wise country exposure(As compiled by the management and relied upon by the
auditors)
( in Million)
Exposure Provision held
Provision held as Exposure (Net)
Risk Category (Net) as at as at
at 31.03.2014 as at 31.03.2013
31.03.2014 31.03.2013
Insignificant 355.1 Nil 432.7 Nil
Low 152.3 Nil 131.0 Nil
Moderate 58.8 Nil 28.5 Nil
High 2.1 Nil 4.8 Nil
Very High 0.8 Nil Nil Nil
Restricted Nil Nil Nil Nil
Off-Credit Nil Nil Nil Nil
Total 569.1 Nil 597.0 Nil

The bank is not having exposure to any country where the net funded exposure is 1 percent or more of the
total assets and hence no provisioning is necessary for country risk, in accordance with the RBI guidelines.

2.7.4 Details of Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by the bank.
( in Million)

Sl As on 31.03.2014
Name of Borrower Advance Investment
No Total Exposure
Exposure Exposure
1 Ajmer Vidyut Vitran Nigam Limited 1011.1 488.4 1499.5
2 TANGEDCO 827.4 387.5 1214.9

2.7.5 Unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights, licenses,
authorisation etc. are available to the bank is Nil.

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2.8 Miscellaneous
Amount of Provisions made for Income-tax during the year
( in Million)
31.03.2014 31.03.2013

Provision for Income Tax(including Deferred Tax & wealth 159.52 61.29
tax)

2.8.1 Disclosure of Penalties imposed by RBI

Nil.
3. Disclosures as per Accounting Standards where RBI has issued Guidelines in respect of items for
‘Notes to Accounts’

3.1 Accounting Standard 5 – Net Profit or Loss for the period, Prior Period Items and Changes in
Accounting Policies
There are no material prior period income/expenditure requiring disclosure.

3.2 Accounting Standard 9 – Revenue Recognition

Income of certain items are recognized on cash basis the effect of which on the financial statements are not
considered to be material.

3.3 Accounting Standard 15 (Revised) –Employee Benefits

During financial year 2010-11, the bank re opened pension for those employees who had not opted for the
pension scheme earlier. Further during the same year the limit of gratuity payable to the employees was also
enhanced pursuant to the amendment to the Payment of Gratuity Act, 1972. In accordance with the RBI
Circular DBOD.No. BP. BC.80/21.04.018/2010-11 dated February 9, 2011 and RBI Letter
DBOD.No.BP.BC.15896/21.04.018/2010-11 dated April 08, 2011 the Bank had amortized the pension and
enhanced gratuity (in the cases mentioned above) for a period of 5 years commencing from
31.03.2011. Accordingly 121.0 Million (representing 1/5th of 604.8 Million (Pension 397.4 Million and
Gratuity 207.4 Million)) has been charged to the Profit and Loss account during the year. The balance
amount carried forward for future amortization is 121.0 Million (previous year 241.9 Million). Had such
a circular not been issued by the RBI and accounting had been done in terms of Accounting Standard 15, the
profit after tax of the Bank for the year would have been higher by 79.9 Million and Reserves and Surplus
would have been lower by 79.9 Million.

3.3.1 Disclosures for Defined Contribution Plans – Provident Fund & New Pension Scheme
(Contributory)
Contributions to employee provident fund and new pension scheme (contributory), debited to Profit & Loss
Account during the year amount to 28.1 Million (previous year 20.2 Million). There is no deficit in the
Income & Expenditure of the provident fund (previous year also no deficit).

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3.3.2 Disclosures for Defined Benefit Plans – Pension, Gratuity & Long term Compensated Absences
(Privilege Leave)

3.3.2.1 Amount recognised in Balance Sheet and Profit & Loss Account

The amount recognised in the balance sheet is as follows: ( in Million)

Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13

Present Value of Obligations -
2802.3 2491.0 819.3 813.0 494.8 528.3
Closing

Fair Value of Plan Assets - Closing 2612.2 1700.1 768.2 655.7 N.A. N.A.

Funded Status 190.1 790.9 51.2 157.3 494.8 528.3

Unrecognised Actuarial Gains Nil Nil Nil Nil Nil Nil
Less Amount unamortised and
carried forward as per RBI letter
DBOD.No.BP. BC. 79.5 158.9 41.5 83.0 N.A. N.A.
15896/21.04.018/2010-11 dated
April 08, 2011

Net Liability recognised in Balance

Sheet (included in Other Liabilities 110.6 632.0 9.6 74.3 494.8 528.3
& Provisions)

The amount recognised in the statement of profit and loss account is as follows:
( in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13

Current Service Cost 558.6 518.5 40.2 34.6 33.8 30.5
Past Service Cost N.A. N.A. N.A. N.A. N.A. N.A.
Interest Cost 190.2 166.2 67.6 61.5 43.9 33.3
Expected Return on Plan Assets (163.6) (125.9) (59.5) ( 49.4) N.A. N.A.
Net Actuarial Loss/(Gain)
200.0 73.2 19.5 27.6 (34.9) 109.3
recognised in the year
Total, (included in “Payment to
and provisions for employees” of 785.2 632.0 67.8 74.3 42.8 173.1
Operating Expenses)

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3.3.2.2 Changes in Fair Value of Plan Assets
( in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)
2013-14 2012-13 2013-14 2012-13 2013-14 2012-13
Fair Value of Plan Assets at the
1700.1 1481.5 655.7 581.4 N.A. N.A.
beginning of the year
Expected Return on Plan Assets 163.6 125.9 59.5 49.4 N.A. N.A.
Contributions 1386.1 585.6 174.0 110.9 76.3 73.2
Benefits Paid 678.2 541.6 116.5 102.5 76.3 73.2
Actuarial (Loss)/Gain 40.6 48.7 (4.5) 16.5 N.A. N.A.
Fair Value of Plan Assets at the end of
2612.2 1700.1 768.2 655.7 N.A. N.A.
the year

3.3.2.3 Changes in Present Value of Obligations ( in Million)

Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13

Present Value of Obligations at the

beginning of the year 2491.0 2226.0 813.0 775.2 528.3 428.4

Interest Cost 190.2 166.2 67.6 61.5 43.9 33.3

Current Service Cost 558.6 518.5 40.2 34.6 33.8 30.5
Past Service Cost N.A. N.A. N.A. N.A. N.A. N.A.
Benefits Paid 678.2 541.6 116.5 102.5 76.3 73.2
Actuarial Loss/(Gain) 240.7 121.9 15.0 44.2 (34.9) 109.3
Present Value of Obligations at the
end of the year 2802.3 2491.0 819.3 813.0 494.8 528.3

3.3.2.4 Movement in Net Liability Recognised in Balance Sheet

( in Million)
Long term Compensated
Pension Gratuity Absences (Privilege
Leave)

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13

Net Liability at the beginning of the
period 632.0 506.1 74.3 69.4 528.3 428.4

Add Expenses Charged to Profit &

Loss Account 864.7 711.5 109.3 115.8 42.8 173.1

Less Contributions 1386.1 585.6 174.0 110.9 76.3 73.2

Net Liability at the end of the period 110.6 632.0 9.6 74.3 494.8 528.3

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3.3.2.5 Actual Return on Plan Assets
( in Million)

Long term Compensated

Pension Gratuity
Absences (Privilege Leave)

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13

Expected Return on Plan Assets 163.6 125.9 59.5 49.4 N.A. N.A.
Actuarial Gain (Loss) 40.6 48.7 (4.5) 16.5 N.A. N.A.
Actual Return on Plan Assets 204.2 174.6 55 65.9 N.A. N.A.

3.3.2.6 Actuarial Assumptions

Long term Compensated
Pension Gratuity
Absences (Privilege Leave)

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13

Discount Rate (p.a.) 8.84% 8.50% 8.96% 8.50% 8.96% 8.50%
Expected Return on Plan Assets (p.a.) 9.62% 8.50% 9.07% 8.50% N.A. N.A.
Future Salary Increases (p.a.) 5.50% 5.00% 5.50% 5.00% 5.50% 5.00%
In accordance with the In accordance with the In accordance with the
Mortality standard table LIC standard table LIC standard table LIC (1994-
(1994-96). (1994-96). 96).

3.3.2.7 Investment Percentage maintained by Pension & Gratuity Trust

Pension Gratuity
As on As on As on As on
31.03.2014 31.03.2013 31.03.2014 31.03.2013
Life Insurance Companies 74.42% 47.12% 49.36% 31.49%
Central Govt. Securities 5.96% 16.70% 21.72% 28.75%
State Govt. Securities 7.20% 12.30% 11.34% 13.79%
Other Trust Securities (PSU)/Deposits
12.42% 23.88% 17.58% 25.97%
with Banks etc.
Total 100.00% 100.00% 100.00% 100.00%

3.3.2.8 Experience Adjustments ( in Million)

Pension Gratuity
2013-14 2012-13 2013-14 2012-13
On Benefit Obligation (Gain+/Loss-) -313.0 -121.9 -79.9 -44.1
On Plan Assets (Gain+/Loss-) 21.6 48.7 -8.3 16.5

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 3.3.2.9 Expected Contributions
Bank’s best estimates of contributions to the funds in 2014-15 are as follows:
Pension: 1100.0 Million
Gratuity: 100.0Million
3.3.3 Other Long term Employee Benefits
As on 31.03.2014 the Bank holds provision of 3.9 Million (previous year 3.8Million) towards provision
for Leave Fare Concession based on actuarial valuation.

3.4 Accounting Standard 17 – Segment Reporting(As compiled by the management and relied upon by
the auditors)
Part A: Business Segments

( in Million)
Business Treasury Corporate/Wholesale Retail Banking Other Banking Total
Segments Banking Business

2013-14 2012-13 2013-14 2012-13 2013-14 2012-13 2013-14 2012-13 2013-14 2012-13
Revenue 4100.93 2767.89 2907.98 3865.00 9051.08 7378.92 152.95 142.49 16212.94 14154.30
Result -1039.86 -943.22 67.87 549.99 1955.73 1291.08 31.24 30.45 1014.98 928.30
Unallocated Nil
expenses Nil
Operating profit 1014.98 928.30
Provisions other 546.00 600.84
than tax
Provision for Tax 159.52 61.29
Extraordinary
profit/ loss Nil Nil
Net profit 309.46 266.17
OTHER
INFORMATION
Segment assets 51849.02 35800.46 30177.70 29465.11 63654.03 62901.32 22.53 19.13 145703.28 128186.02
Unallocated 5950.54 6300.32
assets
Total assets 151653.82 134486.34
Segment 5013.63 304.05 38462.21 45022.87 105657.88 86426.49 147.83 183.64 149281.55 131937.05
liabilities
Unallocated 2372.27 2549.29
liabilities
Total liabilities 151653.82 134486.34

Part B: Geographic segments

The Bank has no branches outside India.

3.5 Accounting Standard 18 – Related Party disclosures

Name of the Party Nature of Relationship
Sri.Rakesh Bhatia Key Management Personnel
(Managing Director and CEO)
Note: In accordance with the RBI Guidelines on compliance with Accounting Standards by the Banks, the
details of transactions with parent, subsidiaries, associates, jointly controlled entity and relatives of Key
Management Personnel have not been disclosed since there is only one entity in the respective category of
the Key Management Personnel.

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3.6 Accounting Standard 22 – Accounting for Taxes on Income
Net Deferred Tax Asset as on 31.03.2014, computed in compliance with the Accounting Standard 22 on
Accounting for Taxes on Income, amounts to 181.3Million.

Components of Net Deferred Tax Asset as on 31.03.2014 are as follows:

( in Million)

31.03.2014 31.03.2013
Deferred Tax Asset
Provision for Employee Benefits 169.5 180.9
Provision for Standard Assets 145.8 158.0
Counter Cyclical Provisioning Buffer 0.0 42.7
Carry Forward Loss 293.8 0.0
Others 40.9 61.3
Total Deferred Tax Asset 650.0 442.9
Deferred Tax Liability
Depreciation on Fixed Assets 47.6 41.2
Interest accrued but not due 339.3 0.0
Special Reserve u/s 36 (1)(viii) 80.7 0.0
Total Deferred Tax Liability 467.6 41.2
Net Deferred Tax Asset 182.4 401.7
Add/Less Effect of Restatement (1.1) 19.8
Net Deferred Tax Asset after restatement 181.3 421.5

3.7 Accounting Standard 25 – Interim Financial Reporting

Bank has complied with the disclosures in connection with the half yearly review prescribed by RBI.
4 Other Accounting Standards
4.1Accounting Standard 10 – Accounting for Fixed Assets
The land and buildings owned by the bank were revalued in 1990-91,1993-94,1998-99, 2004-05,2006-
07,2007-08& 2012-13 and appropriation credited to revaluation reserve. Depreciation for the 12 month
period on the net addition to value on revaluation of assets of 14.0 Million (Previous year 12.3 Million)
has been transferred from Revaluation Reserve to Profit and Loss Account.

4.2 Accounting Standard 19 – Leases

The Properties taken on lease/rental basis are renewable/cancelable at the option of the Bank.

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4.3 Accounting Standard 20 – Earnings per Share

Particulars 2013-14 2012-13

EPS-Basic/Diluted 7.39 7.13
Amount used as numerator- Profit after Tax ( in
Million) 309.46 266.17
Nominal value per Equity Share 10 10
Weighted Average Number of Equity Shares used as
denominator 41847125 37309480

4.4Accounting Standard 26 – Intangible Assets

The bank has complied with AS 26 (Intangible Assets) and the disclosures required under the Standard are
as follows:
( in Million)
31.03.2014 31.03.2013

a) Acquired Application Software

Opening Balance at cost 58.4 51.8
Add Additions during the year 33.4 6.6
Less Disposals during the year Nil Nil
Less Amortisation to date 51.1 42.4
Net Carrying Amount* 40.7 16.0
b) Internally Generated Software
Opening Balance at cost 90.5 82.6
Add Additions during the year 8.0 7.9
Less Disposals during the year Nil Nil
Less Amortisation to date 82.0 76.2
Net Carrying Amount* 16.5 14.3
Total Carrying Amount 57.2 30.3

*The Net carrying amount of acquired application software and internally generated application software are
included in Other Assets.

4.5Accounting Standard 28 - Impairment of Assets

In the opinion of the Bank’s management, there is no material impairment to the fixed assets as at
31.03.2014 requiring recognition in terms of Accounting Standard 28 – Impairment of Assets.

4.6Accounting Standard 29- Provisions, Contingent Liabilities and Contingent Assets

Movements in significant provision heads have been disclosed at appropriate places in the Notes forming
part of the accounts.

4.6.1 Description of Contingent Liabilities

a) Claims against the bank not acknowledged as debts

These represent claims filed against the Bank in the normal course of business relating to various legal cases
currently in progress. These also include demands raised by Income tax and other statutory authorities and
disputed by the bank.

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b) Guarantee given on behalf of constituents

As a part of its banking activities, the Bank issues guarantees on behalf of its customers to enhance their
credit standing. Guarantees represent irrevocable assurances that the Bank will make payments in the event
of the customer failing to fulfill its financial or performance obligation.

c) Acceptances, endorsements and other obligations

These include documentary credit issued by the bank on behalf of its customers and bills drawn by the
Bank’s customers and accepted or endorsed by the Bank.

5. Additional Disclosures as per RBI Guidelines

5.1 Details of provisions and contingencies debited in Profit and Loss Account during the year
( in Million)
31.03.2014 31.03.2013

a Provisions towards NPA/write offs 749.19 391.82

b Drawal from Counter Cyclical Provisioning Buffer (153.03) Nil
c Depreciation and write off of investments 45.63 12.69
d Provision for Income tax (Including Deferred Tax and 159.52 61.29
Wealth Tax)
e Provision for Standard Assets (35.81) 126.69
f Provision for diminution on Restructured Advances (65.96) 73.41
g Other provisions 6.10 (3.77)
Total 705.64 662.13

5.2 Floating Provisions

a) Opening Balance in floating provisions account Nil
b) Quantum of floating provisions made in the accounting year Nil
c) Purpose & amount of draw down made during the accounting year Nil
d) Closing balance in floating provisions account Nil

5.3 Draw Down from Reserves

The bank creates Special Reserve by appropriation of profits, in order to avail tax deductions as per section
36 (1) (viii) of the Income Tax Act, 1961. The Reserve bank Of India through its circular DBOD No.
BP.BC.77/21.04.018/2013 -14 dated December 20, 2013 on Deferred Tax Liability on Special Reserve
created under section 36 (1) (viii) of the Income Tax Act, 1961 had advised banks to create deferred tax
liability on the amount outstanding in Special Reserve as a matter of prudence. In accordance with the above
said circular the bank has transferred 80.7Million from General Reserves and created deferred tax liability
for the periods upto 31.03.2013. Had this amount been charged to Profit & Loss account, the amount of
profit for the year would have been lower by such amount.

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 5.4 Disclosure of complaints

A. Customer Complaints (Other than ATM)

a) No. of complaints pending at the beginning of the year 5

b) No. of complaints received during the year 62
c) No. of complaints redressed during the year 60
d) No. of complaints pending at the end of the year 7

B. ATM Complaints

a) No. of ATMs complaints pending at the beginning of the year Nil

b) No. of ATMs complaints received during the year 3245
c) No. of ATMs complaints redressed during the year 3245
d) No. of ATMs complaints pending at the end of the year Nil

C. Awards passed by the Banking Ombudsman

a) No. of unimplemented Awards at the beginning of the year Nil

b) No. of Awards passed by the Banking Ombudsmen during the year 2
c) No. of Awards implemented during the year 2
d) No. of unimplemented Awards at the end of the year Nil

5.5 Disclosure of Letter of Comforts (LOCs) issued by banks

Not applicable since the bank has no subsidiaries.

5.6 Provisioning Coverage Ratio

As on 31.03.2014 As on 31.03.2013
Provisioning Coverage Ratio 49.28% 63.28%

5.7 Income from Bancassurance

( in Million)
Sl.No. Nature of Income 2013-14 2012-13
1. From Selling Life Insurance Policies 9.3 3.4
2. From Selling Non Life Insurance Policies 6.1 5.2
3. From Selling Mutual Fund Products 0.3 0.4
4. Others Nil Nil
5. Total 15.7 9.0

5.8 Concentration of Deposits, Advances, Exposures and NPAs

5.8.1 Concentration of Deposits

As on As on
31.03.2014 31.03.2013
Total Deposits of twenty largest depositors ( in Million) 20369.4 20370.4
Percentage of Deposits of twenty largest depositors to Total Deposits of the
14.90% 16.51%
bank

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 5.8.2 Concentration of Advances
As on As on
31.03.2014 31.03.2013
Total Advances to twenty largest borrowers ( in Million) 11567.3 11806.5
Percentage of Advances to twenty largest borrowers to Total Advances of
11.40% 11.53%
the bank
5.8.3 Concentration of Exposures
As on As on
31.03.2014 31.03.2013
Total Exposures to twenty largest borrowers/customers( in Million) 13141.5 11883.3
Percentage of Exposures to twenty largest borrowers/customers to Total
12.53% 11.50%
Exposure of the bank on borrowers/customers
5.8.4 Concentration of NPAs
( in Million)
As on As on
31.03.2014 31.03.2013
Total Exposures to top four NPA Accounts 1430.5 532.6

5.9 Sector wise NPAs

Percentage of NPAs to Total

Advance in that Sector
Sl.No. Sector
As on As on
31.03.2014 31.03.2013
1. Agriculture & allied activities 0.52% 1.13%
2. Industry (Micro & small, Medium and Large) 3.94% 1.30%
3. Services 4.85% 1.99%
4. Personal Loans 4.92% 0.47%

5.10 Movement of NPA

( in Million)
Particulars 2013-14 2012-13
Opening Balance of Gross NPA 2108.6 1829.3
Additions (Fresh NPAs) during the year 3903.6 1713.1
Sub-total (A) 6012.2 3542.4
Less:-
(i) Upgradations 446.7 652.9
(ii) Recoveries (excluding recoveries made from upgraded accounts) 2224.1 525.2

(iii) Technical/ Prudential Write-offs 0.00 249.3

(iv) Write-offs other than those under (iii) above 5.9 6.4
Sub-total (B) 2676.7 1433.8
Closing balance of Gross NPA (A – B) 3335.5 2108.6

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5.11 Movement of technical write offs and recoveries:
( in Million)

Particulars 2013-14 2012-13

Opening balance of technical/prudential written off
594.6 382.6
accounts
Add: Technical/Prudential write-offs during the year 0.0 249.3
Sub-total(A) 594.6 631.9
Less-Recoveries made from previously
technical/Prudential written offs accounts during the year 120.4 37.3
(including sale to ARCs)(B)
Closing balance (A-B) 474.2 594.6

5.12 Overseas Assets, NPAs and Revenue

( in Million)
Particulars 31.03.2014 31.03.2013
Total Assets (Deposits with banks outside India) 866.1 384.7
Total NPAs Nil Nil
Total Revenues (Interest on Deposits with banks outside
0.3 0.1
India)

5.13 Off-balance Sheet SPVs sponsored

(which are required to be consolidated as per accounting norms)
Nil
5.14 Unamortised Pension and Gratuity Liabilities
( in Million)
Particulars 2013-14 2012-13
Unamortised Pension Liability 79.5 158.9
Unamortised Gratuity Liability 41.5 83.0
Total 121.0 241.9

5.15 Disclosure on Remuneration

Qualitative (a) Information relating to the composition and mandate of the

disclosures Remuneration Committee.

Composition

The Remuneration & Compensation Committee of the Board consist of

five members. All the members of the Committee are independent
directors.

Function and mandate

The Remuneration and Compensation Committee of the Board would

F-136
 oversee framing, review and implementation of the compensation
policy on behalf of the Board. The Committee would ensure that the
cost/income ratio of the bank supports the remuneration package
consistent with maintenance of sound capital adequacy ratio.

(b) Information relating to the design and structure of remuneration

processes and the key features and objectives of remuneration policy.

Process
The Remuneration and Compensation Committee works in close co-
ordination with the Risk Management Committee of the Board to
review the compensation practices every year in order to achieve
effective alignment between remuneration and risks. . The
Remuneration and Compensation Committee will study the business
and industry environment, analyze and categorize the risks and
streamline the components of the compensation plan like proportion of
the total variable compensation to be paid to MD & CEO,WTD’s and
Senior executives to ensure financial stability of the organization.

The Committee would also analyze various factors to ascertain whether

cost/ income ratio supports the remuneration package provided to MD
& CEO, WTD’s and Senior Executives consistent with maintenance of
sound capital adequacy ratio.

Authority to invoke clawback arrangement

The Remuneration and Compensation Committee of the

Board also have the authority to ascertain whether the decision taken by
the MD& CEO, WTD, Senior executives (above Chief General
Manager) have brought forth a negative contribution to the Bank. The
Committee will be vested with the powers to invoke the clawback
arrangement, after taking into account relevant statutory and regulatory
stipulations as applicable.
Objectives

The objectives of the remuneration policy are four fold:

• To align compensation with prudent risk taken.

• To ensure effective governance of the compensation in the

organization.

• To ensure effective supervisory oversight and stakeholder

engagement in compensation.

• To attract and retain talent.

F-137
 Key features

• To actively oversee the compensation systems design and

operation.

• To monitor and review the compensation system to ensure that

the system operates as intended.

• Staff engaged in financial and risk control must be independent,

have appropriate authority, and be compensated in a manner that
is independent of the business areas they oversee and
commensurate with their key role in the firm.

• Supervisory review of compensation practices must be rigorous

and sustained and deficiencies must be addressed promptly with
supervisory action.

• Firms must disclose clear comprehensive and timely

information about their compensation practices to facilitate
constructive engagement by all stakeholders.

(c) Description of the ways in which current and future risks are taken into
account in the remuneration processes. It should include the nature and
type of the key measures used to take account of these risks.

For the purpose of effectively aligning compensation structure with risk

outcomes, the functionaries in the institution are arranged under the
following four categories.

1) MD & CEO/Whole time directors

2) Senior Executives ((Risk control and compliance staff) - Non
IBA Package
3) Senior Executives (Chief General Manger) -Non IBA Package

4) Other officers and staff -on IBA package

Clawback Arrangement/ Compensation Recovery

A clawback arrangement or a compensation recovery is provided in

the policy [MD & CEO ,WTD’s and Senior Executives- above Chief
General Manager) which will entail the Bank to recover proportionate
amount of variable compensation paid to the functionaries on account
of an act or decision taken by the official which has brought forth a
negative contribution to the bank at a prospective stage. The clawback
arrangement is subject to the relevant statutory and regulatory
stipulations as applicable.

Limit on variable pay

The variable compensation offered to an official would not exceed 70%

F-138
 of the total fixed compensation.

Severance pay and guaranteed bonus

Severance pay (other than gratuity or terminal entitlements or as

entitled by statute) is not paid to any official of the organization except
in those cases where it is mandatory by statute.

Sign on bonus or joining bonus is limited to the first year and is paid
only as Employee stock options.

Hedging

No compensation scheme or insurance facility would be provided by

the Bank to employees to hedge their compensation structure to offset
the risk alignment mechanism (deferral pay and clawback
arrangements) embedded in their compensation arrangement.

Committees to mitigate risks caused by an individual decision

In order to further balance the impact of market or credit risks caused to

the organization by an individual decision taken by a senior level
executive, MD & CEO or a whole time director, the bank, as a
promoted practice, has constituted various committees to take
decisions on various aspects.
Credit limits are sanctioned by committee at different levels.

Investment decisions of the Bank are taken and monitored by

Investment Committee and there is an upper limit cut in treasury
dealings where individual decisions can be taken.

Interest rates on Asset and liability products for different

buckets are decided and monitored by the ALCO. Banks’ exposure to
liquidity risk are also monitored by ALCO.

Compensation of risk control staff

Members of staff engaged in financial and risk control would be

compensated in a manner that is independent of the business areas they
oversee and commensurate with their key role in the bank.The mix of
fixed and variable compensation for control function personnel should
be weighted in favour of fixed compensation.

(d) Description of the ways in which the bank seeks to link performance
during a performance measurement period with levels of remuneration.

Compensation of MD & CEO, whole time directors and senior

F-139
 executives (Non IBA) , performance linkage

The compensation paid out to the referred functionaries is divided into

two components

1. The fixed compensation is determined based on the industry

standards, the exposure, skill sets, talent and qualification
attained by the official over his/her career span.

2. The variable compensation for MD & CEO and senior executives

on Non – IBA package basis are fixed based on performance and
responsibility in the bank. The Bank’s performance is based on
the various financial indicators like revenue earned, cost
deployed, profit earned, NPA position and other intangible
factors like leadership and employee development. Variable
pay is paid purely based on performance.

Approval from RBI is obtained to decide compensation for MD & CEO

and whole time directors. The payment of compensation also requires
approval of the shareholders of the Bank in the General Meeting
pursuant to the Bank’s Articles of Association read with the Section
309 (1) of the Companies Act, 1956.

Compensation paid to Other Officers and staff members on IBA

package

The compensation paid to other officials that include Award staff,

Officers coming under Scale I to III and Senior executives coming
under Scale IV to VII is fixed based on the periodic industry level
settlements with Indian Bank Association. The variable compensation
paid to functionaries is based on the Performance Linked incentive
scheme which has been formulated on the basis of performance
parameters.

(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.

Deferred compensation and Performance Linkage (Non-IBA)

In the event variable compensation paid to MD & CEO, WTD’s, Senior

executives (above Chief General Manger), the deferred period should
not be less than three years. Compensation payable under deferral
arrangements should vest no faster than on a pro rata basis.

Clawback and deferral arrangements

The provisions of clawback and deferral arrangements applicable to the
referred functionaries (above Chief General Manger) are subject to
relevant statutory and regulatory stipulations as applicable.

F-140
 (f) Description of the different forms of variable remuneration (i.e. cash,
shares, ESOPs and other forms) that the bank utilizes and the rationale
for using these different forms.

Bank uses an optimum mix of cash, ESOPS and variable PLI to decide
the compensation to MD & CEO /WTD and senior executives on Non –
IBA package. This is done to align the compensation of senior staff
with their performance, risk and responsibility taken in higher
assignments. Bank has to formulate a ESOP plan/scheme.

The Officers in Scale I-VII as well as Award staff come under the
purview of IBA package that is as per the Industry wide settlements.
The variable compensation paid to functionaries is based on the
Performance Linked incentive scheme which has been formulated on
the basis of performance parameters as may be prescribed from time to
time.

Current Year Previous Year

Quantitative (g) Number of meetings held by the Nil 2
disclosures Remuneration & Compensation
(The quantitative Committee during the financial year Nil ` 40,000
disclosures and remuneration paid to its members.
should only (h) (i) Number of employees having Nil 1
cover Whole received a variable remuneration
Time Directors / award during the financial year.
Chief Executive
Officer / Other (ii) Number and total amount of sign-
Risk Takers) on awards made during the
financial year. NIL Nil
(iii) Details of guaranteed bonus, if
any, paid as joining / sign on Nil
bonus Nil
(iv) Details of severance pay, in
addition to accrued benefits, if Nil
any. Nil
(i) (i) Total amount of outstanding Nil Nil
deferred remuneration, split into
cash, shares and share-linked
instruments and other forms.
(ii) Total amount of deferred
remuneration paid out in the
financial year. Nil Nil

(j) Breakdown of amount of ` 1,495,000(F)

remuneration awards for the ` 7,500,000 (F)
financial year to show fixed and ` 450,000(V)
variable, deferred and non- Nil
deferred (on payment basis).
(k) (i) Total amount of outstanding Nil Nil

F-141
 deferred remuneration and
retained remuneration exposed to
ex post explicit and / or implicit
adjustments.
(ii) Total amount of reductions
during the financial year due to
ex- post explicit adjustments. Nil Nil
(iii) Total amount of reductions
during the financial year due to Nil Nil
ex- post implicit adjustments.

5.16 Disclosures relating to Securitisation

Not applicable to the Bank at this stage.
5.17 Credit Default Swaps
Nil
6. Small and Micro 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.
There have been no reported cases of delays in payments to micro and small enterprises or of interest
payments due to delays in such payments. The above is based on the information available with the Bank
which has been relied upon by the auditors.
7. Comparative Figures

Previous year’s figures have been regrouped and recast wherever necessary to conform to current year’s
classification.

F-142
NOTES ON ACCOUNTS FOR THE HALF YEAR ENDED ON 30.09.2014.

1.1 Capital Infusion

On October 14, 2014, the Board of Directors of the Bank allotted 3406094 equity shares @ 180/- per share
under preferential allotment route to eleven investors. Consequent to the above, the paid up capital of the Bank
has increased to 452.5 million from 418.4 million and Share premium to 3485.6 million from
2906.7.million.

1.2 Investments

a) The loss on sale of investments under Held to Maturity category amounting to 15.2million has been
charged to Profit & Loss Account. (As against profit of 267.9million taken to Profit and Loss account
in FY 2013-14).

b) In respect of Investments in Held to Maturity category, the amount of amortisation of excess of

acquisition cost over face value is 84.2million (FY 2013-14 - 161.4 million) which is netted against
Income on Investments.

c) Excess provisions on depreciation in the Available for Sale category of investments amounting to 24.4
million (FY 2013-14– Nil) has been credited to Profit & Loss Account.

d) During the half year ended September 30, 2014, the bank has transferred securities from Held to
Maturity category to Available for Sale category amounting to 4143.1million between categories. (FY
2013-14 – 7747.5 million)

1 .3 Reconciliation

Reconciliation of inter-bank and inter-branch transactions has been completed up to 30th September 2014. Steps
for elimination of outstanding entries are in progress. Since the outstanding entries to be eliminated are
insignificant, no material consequential effect is anticipated.

1.4Taxation

Claims against the bank not acknowledged as debt under contingent liabilities include disputed income tax
liabilities of 91.7 million (FY 2013-14 – 92.1 million) which has been paid/adjusted and included under
other assets. In respect of these claims, provision for tax is not considered necessary based on various judicial
decisions on such disputes. Management does not envisage any liability in respect of such disputed issues.

Provision for income tax for the half year is arrived at after due consideration of the various judicial decisions
on certain disputed issues.

1.5 Wage settlement

Pending settlement of wage revision with effect from 1-11-2012, Provision of 83.7 million F.Y. 2013-14
153.90 million has been created during the current half year on the basis estimated by the management (Total
provision held is 298.5 million). Bank has also created a provision in FY 2013-14 of 100 million towards
expected escalation in retirement benefit costs pursuant to such revision.

F-143
1.6 Unamortised loss on sale of Financial Assets

a) In the first quarter of FY 2014-15, the bank had sold financial assets of Net Book Value of 663.6 million
to asset reconstruction companies for a consideration of 622.0 million, which resulted in a shortfall of
41.6 million. Bank has drawn the entire balance of Counter Cyclical Provisioning Buffer of 25.4 million
towards meeting this shortfall as permitted by RBI circular DBOD.BP.BC.No.98/21.04.132/2013-14 dated
February 26, 2014. The remaining loss of 16.2 million is amortised over a period of 2 years beginning in
the quarter in which the asset is sold in line with RBI guidelines. Accordingly, a sum of 4.0 million has
been amortised during the period, and the balance amount carried forward is 12.1 million.

b) In the second quarter of FY 2014-15, the bank had sold financial assets of Net Book Value of 931.7
million to asset reconstruction companies for a consideration of 467.5 million, which resulted in a
shortfall of 464.2 million. The shortfall is amortised over a period of 2 years beginning in the quarter in
which the asset is sold in line with RBI circular DBOD.BP.BC.No.98/21.04.132/2013-14 dated February
26, 2014. Accordingly, a sum of 58 million has been amortised during the period and the balance amount
carried forward is 406.2 million

c) The total unamortised loss on sale of financial assets to Asset Reconstruction Companies to be carried
forward, amounts to 418.3 million and is shown under Other Assets.

2. Disclosures in terms of Reserve Bank of India Guidelines

2.1 Capital

Basel III
Particulars
30.09.2014 31.03.2014
i) Common Equity Tier 1 capital ratio (%) 7.87 9.08

ii) Tier 1 Capital ratio (%) 7.87 9.08

iii) Tier 2 Capital ratio (%) 1.85 1.92
iv) Total Capital ratio (CRAR) (%) 9.72 11.00

v) Percentage of the shareholding of the Government of India in NA N.A.

public sector banks
vi) Amount of equity capital raised (during the half year/year) Nil Nil

vii) Amount of Additional Tier 1 capital raised (during the half

year/year); of which Nil Nil
PNCPS: Nil Nil
PDI:
viii) Amount of Tier 2 capital raised (during the half year/year) ; of
which
Debt capital instrument: Nil Nil
Preference Share Capital Instruments: Nil Nil
[Perpetual Cumulative Preference Shares (PCPS) / Redeemable
Non-Cumulative Preference Shares (RNCPS) / Redeemable
Cumulative Preference Shares (RCPS)]

F-144
 BASEL II
Particulars 30.09.2014 31.03.2014
i) Common Equity Tier 1 capital ratio (%) 7.96 9.27
ii)Tier 1 Capital ratio (%) 7.96 9.27
iii)Tier 2 Capital ratio (%) 1.91 1.98
iv)Total Capital ratio (CRAR) (%) 9.87 11.25

v)Percentage of the shareholding of the Government of India in public Nil Nil

sector banks
vi)Amount of equity capital raised during the half year/year Nil Nil

vii)Amount of Additional Tier 1 capital raised (during the half year/year);

of which
PNCPS: Nil Nil
PDI: Nil Nil

viii)Amount of Tier 2 capital raised (during the half year/year) ;

of which
Debt capital instrument:
Preference Share Capital Instruments: Nil Nil
[Perpetual Cumulative Preference Shares (PCPS) / Redeemable Nil Nil
Non-Cumulative Preference Shares (RNCPS) / Redeemable
Cumulative Preference Shares (RCPS)]

2.2 Investments
( in Million)
Items 30.09.2014 31.03.2014
(1) Value of Investments

(i) Gross Value of Investments 51388.51 51397.84

(a) In India 51388.51 51397.84
(b) Outside India, Nil Nil
(ii) Provisions for Depreciation 58.60 81.31
(a) In India 58.60 81.31
(b) Outside India, Nil Nil
(iii) Net Value of Investments 51329.91 51316.53
(a) In India 51329.91 51316.53
(b) Outside India. Nil Nil
(2) Movement of provisions held towards depreciation on investments

(i) Opening balance 81.3 35.7

(ii) Add: Provisions made during the half year(Shifting of HTM to AFS) 01.7 45.6
(iii)Less: Write-off/ write-back of excess provisions during the half 24.4 NIL
year/year
(iv) Closing balance 58.6 81.3

F-145
2.2.1Repo Transactions(In Face Value terms)
( in Million)

Daily
Minimum Maximum
Average Outstanding
outstanding outstanding
outstanding as on
during the during the
during the 30.09.2014
half year half year
half year

Securities sold under repo

i. Government Securities 320 660 325.3 340
ii Corporate debt securities Nil Nil Nil Nil

Securities purchased under reverse

repo
i. Government Securities 70 2400 93.3 2400
ii Corporate debt securities Nil Nil Nil Nil

Securities sold under Term repo

i. Government Securities 710 4600 1706.9 4250
ii Corporate debt securities Nil Nil Nil Nil

Securities sold under MSF

i. Government Securities 50 200 3.3 Nil
ii Corporate debt securities Nil Nil Nil Nil

Note: The figures relate to LAF Repo/Term Repo/Reverse Repo only. There have been no market repo/reverse
repo transactions during the half-year.

F-146
2.2.2 Non-SLR Investment Portfolio
i) Issuer composition of Non SLR investments
( in Million)
Extent of ‘Below
Extent of Extent of Extent of
Investment
No. Issuer Amount Private ‘Unrated’ ‘Unlisted’
Grade’
Placement Securities Securities
Securities
(1) (2) (3) (4) (5) (6) (7)
(i) PSUs* 1547. 1246.5 Nil 326.5 1246.5
(ii). FIs 30. 30. Nil Nil Nil
(iii). Banks 2072.5 1781.5 Nil Nil Nil
(iv). Private Corporate 118.6 67.1 7.8 40. 47.9
(v). Subsidiaries/ Joint Nil Nil Nil Nil Nil
Ventures
(vi). Others 6132.2 2194.8 Nil 2194.8 2194.8
(RIDF, RHF, MSME
Fund, SRs)
(vii). Provision held (58.6) Nil Nil Nil Nil
towards depreciation
Total 9841.7 5319.9 7.8 2561.3 3489.2
* includes securities issued by Govt. of Rajasthan amounting to 171.2 million

ii)Non performing Non-SLR investments ( in Million)

Particulars 30.09.2014 31.03.2014
Opening balance 48.6 0.8
Additions during the half year/year Nil 47.8
Reductions during the above period Nil Nil
Closing balance 48.6 48.6
Total provisions held 48.6 48.6

2.2.3 Sale and transfers to/from HTM Category

Sale from HTM category of investments is within 5% of the opening book value and hence disclosure
requirements have not been triggered.

2.3. Derivatives: Nil

2.3.1 Forward Rate Agreement/ Interest Rate Swap: Nil

2.3.2 Exchange Traded Currency and Interest Rate Derivatives: Nil

2.3.3 Disclosures on risk exposure in derivatives: Nil

2.3.4 Qualitative & Quantitative Disclosure: Not Applicable

F-147
 2.4. Asset Quality

2.4.1 Non-Performing Asset

( in Million)
Particulars 30.09.2014 31.03.2014
(i) Net NPAs to Net Advances (%) 3.76% 2.22%
(ii) Movement of NPAs (Gross)
(a) Opening balance 3335.5 2108.6
(b) Additions during the half year/year 2710.7 3903.6
(c) Reductions during the half year/year 700.5 2676.7
(d) Closing balance 5345.7 3335.5
(iii) Movement of Net NPAs
(a) Opening balance 1932.4 992.5
(b) Additions during the half year/year 2299.8 3200.9
(c) Reductions during the half year/year 689.1 2261.0
(d) Closing balance 3543.1 1932.4
(iv)Movement of provisions for NPAs (excluding provisions on standard
assets)
(a) Opening balance 1351.4 910.2
(b) Provisions made during the half year/year 560.6 655.0
(c) Write-off/ write-back of excess provisions 135.7 213.8
(d) Closing balance 1776.3 1351.4

F-148
2.4.2 PARTICULARS OF ACCOUNTS RESTRUCTURED/RESCHEDULED AS ON 30.09.2014

(`.in million)
Sl
. Type of
Under CDR Mechanism Under SME Debt Restructuring Mechanism Others Total
N Restructuring
o.

Sub-Standard

Sub-Standard
classification

Sub-standard

Sub-standard
Doubtful

Doubtful

Doubtful

Doubtful
Standard

Standard

Standard

Standard
Total
Asset

Total

Total

Total
Loss

Loss

Loss

Loss
Details
No. of
5 - 1 - 6 - - - - - 67 1 12 - 80 72 1 13 - 86
borrowers
Restructured
Accounts as on Amount
1 1699.9 - 459.9 - 2159.8 - - - - - 1892.2 56.4 16.2 - 1964.8 3592.1 56.4 476.1 - 4124.6
April 1 of the HY outstanding
(opening figure)
Provision
84.3 - - - 84.3 - - - - - 4.8 - 00.71 - 5.51 89.1 - 00.71 - 89.81
thereon

No. of
- - - - - - - - - - 2 - - - 2 2 - - - 2
borrowers

Fresh restructuring Amount

2 - - - - - - - - - - 15.7 - - - 15.7 15.7 - - - 15.7
during the half year. outstanding

Provision
- - - - - - - - - - - - - - - - - - - -
thereon

No. of
- - - - - - - - - - - - - - - - - - - -
borrowers
Upgradations to
restructured Amount
3 - - - - - - - - - - - - - - - - - - - -
standard category outstanding
during the HY.
Provision
- - - - - - - - - - - - - - - - - - - -
thereon

F-149
 No. of
- - - - - - - -
Restructured borrowers
standard advances
which cease to
attract higher
provisioning and /
or additional risk
4 weight at the end of Amount
the HY and hence - - - - - - - -
outstanding
need not be shown
as restructured
standard advances
at the beginning of
the next HY.
Provision
- - - - - - - -
thereon

No. of
- - - - - - - - - - 1 - - - 1 1 - - - 1
borrowers
Downgradations of
restructured Amount
5 - - - - - - - - - - 0.33 - - - 0.33 00.33 - - - 00.33
accounts during the outstanding
HY.
Provision
- - - - - - - - - - 0.017 - - - 0.017 0.017 - - - 0.017
thereon
Write-offs of No. of
- - - - - - - - - - - - - - - - - - - -
restructured borrowers
6
accounts during the Amount
- - - - - - - - - - - - - - - - - - - -
HY. outstanding
No. of
2 - 1 - 3 - - - - - 58 1 11 - 70 60 1 12 - 73
borrowers
Restructured
accounts as on
Amount
7 September 30 of the 649.7 - 460. - 1109.7 - - - - - 1858.8 0.33 16.1 - 1875.23 2508.5 0.33 476.1 - 2984.93
outstanding
HY (closing
figures*)
Provision
3.7 - - - 3.7 - - - - - 3.9 0.017 0.7 - 4.6 7.6 0.017 0.7 - 8.3
thereon
*Excluding the figures of Standard Restructured Advances which do not attract higher provisioning or risk weight (if applicable)

F-150
2.4.3 Details of financial assets sold to Securitisation / Reconstruction Company for
Asset Reconstruction
( in Million)
6 months ended 12 months
30.09.2014 ended
31.03.2014
(i) No. of accounts 7 112
(ii) Aggregate value (net of provisions) of 1595.2 1364.2
accounts sold to SC/RC
(iii) Aggregate consideration 1089.5 1270.0
(iv) Additional consideration realized in respect Nil Nil
of accounts transferred in earlier years
(v) Aggregate gain/(loss) over net book value (505.7) (94.2)

2.4.4 Details of non-performing financial assets purchased/sold from/to other banks

Nil.

2.4.5 Provisions on Standard Assets

( in Million)
Particulars 30.09.2014 31.03.2014
Provisions held towards Standard Assets 427.0 428.9

2.5 Business Ratio

Particulars 6 Months ended 12 months
30.09.2014 ended
(Annualised) 31.03.2014
(i)Interest Income as a percentage to Working 10.00 10.25
Funds
(ii)Non-interest income as a percentage to 0.62 0.80
Working Funds
(iii)Operating Profit as a percentage to Working 0.34 0.69
Funds
(iv) Return on Assets (%) (0.24) 0.21

(v) Business (Deposits plus advances) per 76.62 77.56

employee (` Million)
(vi) Profit /(Loss) per employee (` Million) (0.06) 0.11

F-151
2.6 Asset Liability Management

Maturity pattern of certain items of assets and liabilities(as compiled by the management and relied upon by the auditors)
( in Million)
Over 3 Over 6 Over 1 Over 3
29 days
As on 2-7 8 - 14 15 to 28 months & months year & years & Over 5 Total
Day 1 to 3
30.09.2014 Days Days days up to 6 & up to up to 3 up to 5 years
months
months 1 year years years
Deposits 418.50 811.80 1435.10 2026.20 7230.60 8854.90 11047.50 32888.01 3430.70 73511.71 141655.02
Advances 303.10 1311.40 1893.70 1859.50 8196.80 7916.50 21711.70 36790.20 7007.00 7313.13 94303.03
Investments 2900.00 2557.30 4262.00 3243.50 135.90 514.00 3620.20 624.30 180.90 33291.81 51329.91
Borrowings 1180.00 1250.00 2250.00 0.00 157.00 36.48 36.47 0.00 418.00 0.00 5327.95
Foreign
Currency assets 899.50 43.36 35.84 46.80 380.05 125.79 41.05 12.35 401.38 0.00 1986.12
Foreign
Currency
liabilities 68.92 4.02 4.71 18.55 91.62 116.39 395.81 419.64 443.58 0.00 1563.24

Note: Deposits have been classified as per behavioural maturity.

F-152
 2.7 Exposures
2.7.1 Exposure to Real Estate Sector ( in Million)
(As compiled by the management and relied upon by the auditors)

Category 30.09.2014 31.03.2014

a) Direct exposure
(i) Residential Mortgages
a) Priority sector 2450.3 2411.8
b) Non priority sector 1451.9 1273.1
( Of which staff housing loans) (711.8) (710.3)
c) Total 3902.2 3684.9
(ii) Commercial Real Estate 5284.0 4072.5
(iii) Investments in Mortgage Backed Securities (MBS) and
other securitised exposures –

a. Residential, Nil Nil

b. Commercial Real Estate. Nil Nil
b) Indirect Exposure
Fund based and non fund based exposures on National
Housing Bank (NHB) and Housing Finance Companies
(HFCs) Nil Nil

Total Exposure to Real Estate Sector 9186.2 7757.4

2.7.2 Exposure to Capital Market ( in Million)

(As compiled by the management and relied upon by the auditors)

Sl No Items 30.09.2014 31.03.2014

Direct investment in equity shares, convertible bonds, convertible
debentures and units of equity oriented mutual funds the corpus of which is 1.3 1.3
1
not exclusively invested in corporate debt

Advances against shares/bonds/debentures of other securities or on clean

basis to individuals for investment in shares (including IPOs/ESOPs), 0 1.3
2 convertible bonds, convertible debentures and units of equity oriented
mutual funds

Advances for any other purposes where shares or convertible bonds or

convertible debentures or units of equity oriented mutual funds are taken as Nil Nil
3
primary security

Advances for any other purposes to the extent secured by the collateral Nil Nil
security of shares or convertible bonds or convertible debentures or units of
equity oriented mutual funds i.e. where the primary security other than
4
shares/convertible bonds/convertible debentures/units of equity oriented
mutual funds does not fully cover the advances

Secured and unsecured advances to stockbrokers and guarantees issued on 0 0.2

5 behalf of stockbrokers and market makers

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 Loans sanctioned to corporate against the security of
shares/bonds/debentures or other securities or on clean basis for meeting Nil Nil
6 promoter’s contribution to the equity of new companies in anticipation of
raising resources

7 Bridge loans to companies against expected equity flows/issues Nil Nil

Underwriting commitments taken up by the banks in respect of primary Nil Nil

8 issue of shares or convertible bonds or convertible debentures or units of
equity oriented mutual funds

9 Financing to stock brokers for margin trading Nil Nil

10 All exposures to Venture Capital Funds (both registered and unregistered) Nil Nil
Total Exposure to Capital Market 1.3 2.8

2.7.3 Risk category wise country exposure(As compiled by the management and relied upon by the auditors)
( in Million)
Exposure (Net) as Provision held as Exposure (Net) as Provision held as
Risk Category
at 30.09.2014 at 30.09.2014 at 31.03.2014 at 31.03.2014
Insignificant 358.4 Nil 355.1 Nil
Low 122.4 Nil 152.3 Nil
Moderate 22.1 Nil 58.8 Nil
High 00.5 Nil 2.1 Nil
Very High Nil Nil 0.8 Nil
Restricted Nil Nil Nil Nil
Off-Credit Nil Nil Nil Nil
Total 503.4 Nil 569.1 Nil

The bank is not having exposure to any country where the net funded exposure is 1 percent or more of the total
assets and hence no provisioning is necessary for country risk, in accordance with the RBI guidelines.

2.7.4 Details of Single Borrower Limit (SGL), Group Borrower Limit (GBL) exceeded by the bank.
( in Million)

Sl As on 30.09.2014
Name of Borrower Investment
No Advance Exposure Total Exposure
Exposure
1 Ajmer VidyutVitran Nigam Ltd 1034.1 488.4 1522.5
Tamil Nadu Generation and
2 828.3 326.5 1154.8
Distribution Corporation

2.7.5 Unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights, licenses, authorisation etc.
are available to the bank is Nil.

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2.8 Miscellaneous
Amount of Provisions made for Income-tax during the half year
( in Million)
30.09.2014 31.03.2014

Provision for Income Tax(including Deferred Tax & wealth tax) (94.65) 159.52
2.8.1 Disclosure of Penalties imposed by RBI -Nil.

3. Disclosures as per Accounting Standards where RBI has issued Guidelines in respect of items for ‘Notes
to Accounts’

3.1 Accounting Standard 5 – Net Profit or Loss for the period, Prior Period Items and Changes in
Accounting Policies
In terms of section 123 and Schedule II of the Companies Act ,2013 (the Act) applicable with effect from
01.04.2014, depreciation for the half year ended 30.09.2014 has been provided on the basis of the useful life as
prescribed in Schedule II of the Act. As a result, the depreciation charged for the half year ended 30.09.2014 is
higher by 12.6 million. An amount of 5.6 million (net of Deferred Tax 2.9 million) has been adjusted
against the opening balance of Retained Earnings in respect of the assets which have no remaining useful life
as per the transitional provisions specified in Schedule II of the Act.

3.2 Accounting Standard 9 – Revenue Recognition

Income of certain items are recognized on cash basis the effect of which on the financial statements are not
considered to be material.
3.3 Accounting Standard 15 (Revised) –Employee Benefits

During financial year 2010-11, the bank re opened pension for those employees who had not opted for the
pension scheme earlier. Further during the same year the limit of gratuity payable to the employees was also
enhanced pursuant to the amendment to the Payment of Gratuity Act, 1972. In accordance with the RBI
Circular DBOD.No. BP. BC.80/21.04.018/2010-11 dated February 9, 2011 and RBI Letter
DBOD.No.BP.BC.15896/21.04.018/2010-11 dated April 08, 2011 the Bank had amortized the pension and
enhanced gratuity (in the cases mentioned above) for a period of 5 years commencing from
31.03.2011. Accordingly 60.5 million (representing 50% of 1/5th of 604.8 million (Pension 39.8 million
and Gratuity 20.8 million)) has been charged to the Profit and Loss account during the half year (FY 2013-14
- 121. million). The balance amount carried forward for future amortization is 60.5 million (FY 2013-14-
121 million). Had such a circular not been issued by the RBI and accounting had been done in terms of
Accounting Standard 15, the loss for the half year would have been lower by 39.9 million and Reserves and
Surplus would have been lower by 39.9 million.

3.3.1 Disclosures for Defined Contribution Plans – Provident Fund & New Pension Scheme
(Contributory)
Contributions to employee provident fund and new pension scheme (contributory), debited to Profit & Loss
Account during the half year amount to 19.3 million(FY 2013-14- 28.1 million). There is no deficit in the
Income & Expenditure of the provident fund.

F-155
 3.3.2 Disclosures for Defined Benefit Plans – Pension, Gratuity & Long term Compensated Absences
(Privilege Leave)
3.3.2.1 Amount recognised in Balance Sheet and Profit & Loss Account
The amount recognised in the balance sheet is as follows: ( in million)
Long term Compensated
Pension Gratuity
Absences (Privilege Leave)
HY 14-15 2013-14 HY 14-15 2013-14 HY 14-15 2013-14
Present Value of Obligations - Closing 2834.6 2802.3 827.5 819.3 495.7 494.8
Add: Adhoc provision for expected
escalation in retirement benefits due to wage 90. 90. 10. 10. N.A. N.A.
revision*
Fair Value of Plan Assets - Closing 2965.8 2612.2 812.4 768.2 N.A. N.A.
Funded Status (41.1) 280.1 25.1 61.1 495.7 494.8
Unrecognised Actuarial Gains Nil Nil Nil Nil Nil Nil
Less Amount unamortised and carried
forward as per RBI letter DBOD.No.BP. BC.
39.8 79.5 20.8 41.5 N.A. N.A.
15896/21.04.018/2010-11 dated April 08,
2011
Net Liability (Asset) recognised in Balance
(80.9) 200.6 4.3 19.6 495.7 494.8
Sheet

* Bank had funded 100 millions of adhoc provision towards expected escalation in retirement benefits
created in FY 2013-14.
The amount recognised in the statement of profit and loss account is as follows:
( in million)

Long term Compensated

Pension Gratuity
Absences (Privilege Leave)

HY 14-15 2013-14 HY 14-15 2013-14 HY 14-15 2013-14

Current Service Cost 273.3 558.6 25.0 40.2 34.1 33.8
Past Service Cost N.A. N.A. N.A. N.A. N.A. N.A.
Interest Cost 111.3 190.2 34. 67.6 20.8 43.9
Expected Return on Plan Assets (112.5) (163.6) (33.1) (59.5) N.A. N.A.
Net Actuarial Loss/(Gain) recognised in the
61.5 200. 13. 19.5 (28.7) (34.9)
half year
Total, (included in “Payment to and
provisions for employees” of Operating 333.6 785.2 38.9 67.8 26.2 42.8
Expenses)

F-156
3.3.2.2 Changes in Fair Value of Plan Assets ( in Million)
Long term Compensated
Pension Gratuity
Absences (Privilege Leave)
HY 14-15 2013-14 HY 14-15 2013-14 HY 14-15 2013-14
Fair Value of Plan Assets at the
2612.2 1700.1 768.1 655.7 N.A. N.A.
beginning of the year

Expected Return on Plan Assets 112.5 163.6 33.1 59.5 N.A. N.A.

Contributions 654.9 1386.1 75. 174. 25.3 76.3

Benefits Paid 433.8 678.2 58.6 116.5 25.3 76.3
Actuarial (Loss)/Gain 20. 40.6 (5.2) (4.5) N.A. N.A.
Fair Value of Plan Assets at the end of
2965.8 2612.2 812.4 768.2 N.A. N.A.
the half year/year

3.3.2.3 Changes in Present Value of Obligations ( in Million)

Long term Compensated

Pension Gratuity
Absences (Privilege Leave)

HY 14-15 2013-14 HY 14-15 2013-14 HY 14-15 2013-14

Present Value of Obligations at the
2802.3 2491. 819.3 813.0 494.8 528.3
beginning of the year
Interest Cost 111.3 190.2 34.0 67.6 20.8 43.9
Current Service Cost 273.3 558.6 25. 40.2 34.1 33.8
Past Service Cost N.A. N.A. N.A. N.A. N.A. N.A.
Benefits Paid 433.8 678.2 58.6 116.5 25.3 76.3
Actuarial Loss/(Gain) 81.5 240.7 7.8 15. (28.7) (34.9)
Present Value of Obligations at the end
2834.6 2802.3 827.5 819.3 495.7 494.8
of the half year/ year

3.3.2.4 Movement in Net Liability Recognised in Balance Sheet ( in Million)

Long term Compensated
Pension Gratuity
Absences (Privilege Leave)

HY 14-15 2013-14 HY 14-15 2013-14 HY 14-15 2013-14

Net Liability at the beginning of the
200.6 632.0 19.6 74.3 494.8 528.3
period
Add Expenses Charged to Profit & Loss
373.4 954.7 59.7 119.3 26.2 42.8
Account
Less Contributions 654.9 1386.1 75. 174. 25.3 76.3
Net Liability (Asset) at the end of the
(80.9) 200.6 4.3 19.6 495.7 494.8
period

F-157
3.3.2.5 Actual Return on Plan Assets ( in Million)

Long term Compensated

Pension Gratuity
Absences (Privilege Leave)

HY 14-15 2013-14 HY 14-15 2013-14 HY14-15 2013-14

Expected Return on Plan
112.5 163.6 33.1 59.5 N.A. N.A.
Assets
Actuarial Gain (Loss) 20. 40.6 (5.2) (4.5) N.A. N.A.
Actual Return on Plan Assets 132.5 204.2 27.9 55. N.A. N.A.

3.3.2.6 Actuarial Assumptions

Long term Compensated
Pension Gratuity Absences (Privilege Leave)

HY 14-15 2013-14 HY 14-15 2013-14 HY 14-15 2013-14

Discount Rate (p.a.) 8.61% 8.84% 8.61% 8.96% 8.61% 8.96%
Expected Return on Plan 8.61% 9.62% 8.61% 9.07% N.A. N.A.
Assets (p.a.)
Future Salary Increases (p.a.) 5.50% 5.50% 5.50% 5.50% 5.50% 5.50%
Mortality In accordance with the In accordance with the
In accordance with the
standard table LIC standard table LIC (1994-
standard table LIC (1994-96).
(1994-96). 96).

3.3.2.7 Investment Percentage maintained by Pension & Gratuity Trust

Pension Gratuity
As on As on As on As on
30.09.2014 31.03.2014 30.09.2014 31.03.2014
Life Insurance Companies 81.44% 74.42% 55.98% 49.36%
Central Govt. Securities 3.82% 5.96% 21.92% 21.72%
State Govt. Securities 6.45% 7.20% 10.68% 11.34%
Other Trust Securities (PSU)/Deposits
8.29% 12.42% 11.42% 17.58%
with Banks etc.
Total 100.00% 100.00% 100.00% 100.00%

F-158
 3.3.2.8 Experience Adjustments ( in Million)
Pension Gratuity
HY 14-15 2013-14 HY 14-15 2013-14
On Benefit Obligation (Gain+/Loss-) +45.2 -313. -09.5 -79.9
On Plan Assets (Gain+/Loss-) +33. +21.6 -03.4 -08.3
3.3.2.9 Expected Contributions
Bank’s best estimates of contributions to the funds in second half year of 2014-15 are as follows:
Pension: 300.Million
Gratuity: 50.Million
3.3.3 Other Long term Employee Benefits
As on 30.09.2014 the Bank holds provision of 4.1Million (FY 2013-14 - 3.9 Million) towards provision for Leave
Fare Concession based on actuarial valuation.

3.4 Accounting Standard 17 – Segment Reporting (As compiled by the management and relied upon by the auditors)

Part A: Business Segments

( in Million)
Business Treasury Corporate/Wholesale Retail Banking Other Banking Total
Segments Banking Business

HY 2013-14 HY 2013-14 HY 2013-14 HY 2013-14 HY 2013-14

2014-15 2014-15 2014-15 2014-15 2014-15
Revenue 2006.55 4100.93 1743.95 2907.98 4330.72 9051.08 81.52 152.95 8162.74 16212.94
Result -754.56 -1039.86 -18.78 67.87 1030.20 1955.73 9.35 31.24 266.21 1014.98
Unallocated
Nil Nil
expenses
Operating
266.21 1014.98
profit
Provisions
542.33 546.00
other than tax
Provision for
(94.65) 159.52
Tax
Extraordinary
Nil Nil
profit/ loss
Net
(181.47) 309.46
profit/(Loss)
OTHER
INFORMATIO
N
Segment assets 51799.97 51849.02 32192.51 30177.70 65498.96 63654.03 19.36 22.53 149510.80 145703.28
Unallocated
5983.48 5950.54
assets
Total assets 155494.28 151653.82
Segment
5239.22 5013.63 40445.71 38462.21 107508.20 105657.88 150.39 147.83 153343.52 149281.55
liabilities
Unallocated
2150.76 2372.27
liabilities
Total liabilities 155494.28 151653.82

Part B: Geographic segments

The Bank has no branches outside India.

F-159
3.5 Accounting Standard 18 – Related Party disclosures

Name of the Party Nature of Relationship

Sri.Rakesh Bhatia Key Management Personnel
(Managing Director and CEO)

3.6 Accounting Standard 21 - Consolidated Financial Statements (CFS)

Not Applicable

3.7 Accounting Standard 22 – Accounting for Taxes on Income

Net Deferred Tax Asset as on 30.09.2014, computed in compliance with the Accounting Standard 22 on Accounting for
Taxes on Income, amounts to 278.8 Million, which is included in Other Assets.

Components of Net Deferred Tax Asset as on 30.09.2014 are as follows:

( in Million)

30.09.2014 31.03.2014
Deferred Tax Asset
Provision for Employee Benefits 169.9 169.5
Provision for Standard Assets 156.9 145.8
Carry Forward Loss 277.8 293.8
Others 22.8 40.9
Total Deferred Tax Asset 627.4 650
Deferred Tax Liability
Depreciation on Fixed Assets 43.4 47.6
Interest accrued but not due 283.2 339.3
Special Reserve u/s 36 (1)(viii) 80.7 80.7
Total Deferred Tax Liability 407.3 467.6
Net Deferred Tax Asset 220.1 182.4
Add/Less Effect of Restatement 58.7 (1.1)
Net Deferred Tax Asset after restatement 278.8 181.3

3.8 Accounting Standard 23 - Accounting for Investments in Associates in Consolidated Financial Statements

Not Applicable

3.9 Accounting Standard 24 - Discontinuing Operations

Not Applicable

F-160
4 Other Accounting Standards
4.1Accounting Standard 10 – Accounting for Fixed Assets

The land and buildings owned by the bank were revalued in 1990-91,1993-94,1998-99, 2004-05, 2006-07, 2007-08
& 2012-13 and appropriation credited to revaluation reserve. Depreciation for the 6 month period on the net addition
to value on revaluation of assets of 6.7 Million (FY 2013-14 - 14. Million) has been transferred from Revaluation
Reserve to Profit and Loss Account.

4.2 Accounting Standard 19 – Leases

The Properties taken on lease/rental basis are renewable/cancelable at the option of the Bank.

4.3 Accounting Standard 20 – Earnings per Share

Particulars 30.09.2014 2013-14

EPS-Basic/Diluted ( 4.34) 7.39
Amount used as numerator- Profit / (Loss)after Tax ( in Million) (181.47) 309.46
Nominal value per Equity Share 10 10
Weighted Average Number of Equity Shares used as denominator 41847125 41847125

4.4Accounting Standard 26 – Intangible Assets

The bank has complied with AS 26 (Intangible Assets) and the disclosures required under the Standard are as follows:
( in Million)
30.09.2014 31.03.2014

a) Acquired Application Software

Opening Balance at cost 91.8 58.4
Add Additions during the half year/year 01.8 33.4
Less Disposals during the half year/year Nil Nil
Less Amortisation to date 56.9 51.1
Net Carrying Amount* 36.7 40.7
b) Internally Generated Software
Opening Balance at cost 98.4 90.5
Add Additions during the half year/year 7.2 8.0
Less Disposals during the half year/year Nil Nil
Less Amortisation to date 83.9 82.0
Net Carrying Amount* 21.7 16.5
Total Carrying Amount 58.4 57.2
*The Net carrying amount of acquired application software and internally generated application software are included in
Other Assets.

4.5Accounting Standard 28 - Impairment of Assets

In the opinion of the Bank’s management, there is no material impairment to the fixed assets as at 30.09.2014 requiring
recognition in terms of Accounting Standard 28 – Impairment of Assets.

4.6Accounting Standard 29- Provisions, Contingent Liabilities and Contingent Assets

Movements in significant provision heads have been disclosed at appropriate places in the Notes forming part of the
accounts.

F-161
4.6.1 Description of Contingent Liabilities

a) Claims against the bank not acknowledged as debts

These represent claims filed against the Bank in the normal course of business relating to various legal cases currently in
progress. These also include demands raised by Income tax and other statutory authorities and disputed by the bank.

b) Guarantee given on behalf of constituents

As a part of its banking activities, the Bank issues guarantees on behalf of its customers to enhance their credit standing.
Guarantees represent irrevocable assurances that the Bank will make payments in the event of the customer failing to
fulfill its financial or performance obligation.

c) Acceptances, endorsements and other obligations

These include documentary credit issued by the bank on behalf of its customers and bills drawn by the Bank’s customers
and accepted or endorsed by the Bank.

5. Additional Disclosures as per RBI Guidelines

5.1 Details of provisions and contingencies debited in Profit and Loss Account during the Half Year
( in Million)
30.09.2014 31.03.2014
a Provisions towards NPA/write offs 596.73 749.19
b Drawal from Counter Cyclical Provisioning Buffer (25.37) (153.03)
c Depreciation and write off of investments (22.71) 45.63
d Provision for Income tax (Including Deferred Tax and Wealth Tax) ((94.64)) 159.52
e Provision for Standard Assets (1.95) (35.81)
f Provision for diminution on Restructured Advances (2.04) (65.96)
g Other provisions (2.33) 6.10
Total 447.69 705.64

5.2 Floating Provisions

a) Opening Balance in floating provisions account Nil
b) Quantum of floating provisions made in the accounting half year/year Nil
c) Purpose & amount of draw down made during the accounting half year/year Nil
d) Closing balance in floating provisions account Nil

5.3 Draw Down from Reserves

Bank has not drawn from Reserves any amount other than from profit and loss account balance as detailed in para 3.1.

5.4 Disclosure of complaints

A. Customer Complaints (Other than ATM)

a) No. of complaints pending at the beginning of the half year 7

b) No. of complaints received during the half year 66
c) No. of complaints redressed during the half year 61
d) No. of complaints pending at the end of the half year 12

F-162
 B. ATM Complaints

a) No. of ATMs complaints pending at the beginning of the half year Nil
b) No. of ATMs complaints received during the half year 1809
c) No. of ATMs complaints redressed during the half year 1809
d) No. of ATMs complaints pending at the end of the half year Nil

C. Awards passed by the Banking Ombudsman

a) No. of unimplemented Awards at the beginning of the half year Nil

b) No. of Awards passed by the Banking Ombudsmen during the half year Nil
c) No. of Awards implemented during the half year Nil
d) No. of unimplemented Awards at the end of the half year Nil

5.5 Disclosure of Letter of Comforts (LOCs) issued by banks

Not applicable since the bank has no subsidiaries.
5.6 Provisioning Coverage Ratio

As on As on
30.09.2014 31.03.2014
Provisioning Coverage Ratio 39.11% 49.28%

5.7 Income from Bancassurance

( in Million)
Sl.No. Nature of Income 6 months ended 12 months ended
30.09.2014 31.03.2014
1. From Selling Life Insurance Policies 9.6 9.3
2. From Selling Non Life Insurance Policies 2.3 6.1
3. From Selling Mutual Fund Products 0.00 0.3
4. Others Nil Nil
5. Total 11.9 15.7

5.8 Concentration of Deposits, Advances, Exposures and NPAs

5.8.1 Concentration of Deposits

As on As on 31.03.2014
30.09.2014
Total Deposits of twenty largest depositors ( in Million) 19336.7 20369.4
Percentage of Deposits of twenty largest depositors to Total Deposits
13.65% 14.90%
of the bank

5.8.2 Concentration of Advances

As on As on
30.09.2014 31.03.2014
Total Advances of twenty largest borrowers ( in Million) 11345.5 11567.3
Percentage of Advances to twenty largest borrowers to Total 10.40% 11.40%
Advances of the bank

F-163
 5.8.3 Concentration of Exposures

As on As on
30.09.2014 31.03.2014
Total Exposures to twenty largest borrowers/customers ( in Million) 13704.1 13141.5
Percentage of Exposures to twenty largest borrowers/customers to
Total Exposure of the bank on borrowers/customers 12.06% 12.53%

5.8.4 Concentration of NPAs

( in Million)
As on As on
30.09.2014 31.03.2014
Total Exposures to top four NPA Accounts 2158.2 1430.5

5.9 Sector-wise advances

(As compiled by the management and relied upon by the auditors)
(` in Million)

As on 30.09.2014
Percentage of Gross
Sector Outstanding
Gross NPAs to Total
Total
NPAs Advances in that
Advances
sector

A Priority Sector
1 Agriculture and allied activities 6481.1 66.3 1.02
Advances to industries sector eligible
2
as priority sector lending 15466.8 524.2 3.39
3 Services 6620.4 940.5 14.21
4 Personal loans 3571.9 237.8 6.66
Sub-total (A) 32140.2 1768.8 5.50

B Non Priority Sector

1 Agriculture and allied activities 0 0 0
2 Industry 13101.2 2874.3 21.94
3 Services 22485.9 372.1 1.65
4 Personal loans 28360.3 330.5 1.16
Sub-total (B) 63947.4 3576.9 5.59

Total (A+B) 96087.6 5345.7 5.56

F-164
5.10 Movement of NPA
( in Million)
Particulars HY 2014-15 2013-14
Opening Balance of Gross NPA 3335.5 2108.6
Additions (Fresh NPAs) during the half year/year 2710.7 3903.6
Sub-total (A) 6046.2 6012.2
Less:-
(i) Upgradations 114.1 446.7
(ii) Recoveries (excluding recoveries made from upgraded accounts) 583.0 2224.1
(iii) Technical/ Prudential Write-offs 0.00 0.00
(iv) Write-offs other than those under (iii) above 3.4 5.9
Sub-total (B) 700.5 2676.7
Closing balance of Gross NPA (A – B) 5345.7 3335.5

5.11 Movement of technical write offs and recoveries:

( in Million)

Particulars HY 2014-15 2013-14

Opening balance of technical/prudential written off accounts 474.2 594.6
Add: Technical/Prudential write-offs during the half year/year 0.00 0.00

Sub-total(A) 474.2 594.6

Less-Recoveries made from previously technical/Prudential written offs 0.7 120.4
accounts during the half year/year (including sale to ARCs)(B)
Closing balance (A-B) 473.5 474.2

5.12 Overseas Assets, NPAs and Revenue

( in Million)
Particulars 30.09.2014 31.03.2014
Total Assets (Deposits with banks outside India) 998.8 866.1
Total NPAs Nil Nil
Total Revenues (Interest on Deposits with banks outside India) 0.5 0.3

5.13 Off-balance Sheet SPVs sponsored

(which are required to be consolidated as per accounting norms)
Nil
5.14 Unamortised Pension and Gratuity Liabilities
( in Million)
Particulars 30.09.2014 2013-14
Unamortised Pension Liability 39.8 79.5
Unamortised Gratuity Liability 20.8 41.5
Total 60.6 121.

F-165
5.15 Disclosure on Remuneration

Qualitative (a) Information relating to the composition and mandate of the

disclosures Remuneration & Compensation Committee.

Composition

The Remuneration & Compensation Committee of the Board consist of

five members. All the members of the Committee are independent
directors.

Function and mandate

The Remuneration and Compensation Committee of the Board would

oversee the framing, review and implementation of compensation
policy including ESOS of the bank on behalf of the Board. The
Committee should also ensure that the cost/income ratio of the bank
supports the remuneration package consistent with maintenance of
sound capital adequacy ratio.

(b) Information relating to the design and structure of remuneration

processes and the key features and objectives of remuneration policy.

Process
The Remuneration and Compensation Committee works in close co-
ordination with the Risk Management Committee of the Board to
review the compensation practices every year in order to achieve
effective alignment between remuneration and risks. The
Remuneration and Compensation Committee will study the business
and industry environment, analyze and categorize the risks and
streamline the components of the compensation plan like proportion of
the total variable compensation to be paid to MD & CEO,WTD’s and
Senior executives to ensure financial stability of the organization.

The Committee would also analyze various factors to ascertain whether

cost/ income ratio supports the remuneration package provided to MD
& CEO, WTD’s and Senior Executives consistent with maintenance of
sound capital adequacy ratio.

Authority to invoke clawback arrangement

The Remuneration and Compensation Committee of the
Board also have the authority to ascertain whether the decision taken by
the MD& CEO, WTD, Senior executives/ officers (Non IBA Package)
have brought forth a negative contribution to the Bank. The Committee
will be vested with the powers to invoke the clawback arrangement,
after taking into account relevant statutory and regulatory stipulations
as applicable.

Objectives

F-166
 The objectives of the remuneration policy are four fold:

• To align compensation with prudent risk taken.

• To ensure effective governance of the compensation in the

organization.

• To ensure effective supervisory oversight and stakeholder

engagement in compensation.

• To attract and retain talent.

Key features
• To actively oversee the compensation systems design and
operation.

• To monitor and review the compensation system to ensure that

the system operates as intended.

• Staff engaged in financial and risk control must be independent,

have appropriate authority, and be compensated in a manner that
is independent of the business areas they oversee and
commensurate with their key role in the firm.

• Supervisory review of compensation practices must be rigorous

and sustained and deficiencies must be addressed promptly with
supervisory action.

• Firms must disclose clear comprehensive and timely

information about their compensation practices to facilitate
constructive engagement by all stakeholders.

(c) Description of the ways in which current and future risks are taken into
account in the remuneration processes. It should include the nature and
type of the key measures used to take account of these risks.

For the purpose of effectively aligning compensation structure with risk

outcomes, the functionaries in the institution are arranged under the
following four categories.

1) MD & CEO/Whole time directors

2) Senior Executives ((Risk control and compliance staff) -Non
IBA Package
3) Senior Executives (Chief General Manger) -Non IBA Package

4) Senior / Other Officers - Non IBA Package

5) Other officers and staff -on IBA package

Clawback Arrangement/Compensation Recovery

A clawback arrangement or a compensation recovery is providedin the

F-167
policy[MD & CEO ,WTD’s and Senior executives/ officers (Non IBA
Package) which will entail the Bank to recover proportionate amount
of variable compensation paid to the functionaries on account of an act
or decision taken by the official which has brought forth a negative
contribution to the bank at a prospective stage. The clawback
arrangement is subject to the relevant statutory and regulatory
stipulations as applicable.

Limit on variable pay

The variable compensation offered to an official would not exceed 70%

of the total fixed compensation.

Severance pay and guaranteed bonus

Severance pay (other than gratuity or terminal entitlements or as

entitled by statute) is not paid to any official of the organization except
in those cases where it is mandatory by statute.

Sign on bonus or joining bonus is limited to the first year and is paid
only as Employee stock options.

Hedging

No compensation scheme or insurance facility would be provided by

the Bank to employees to hedge their compensation structure to offset
the risk alignment mechanism (deferral pay and clawback
arrangements) embedded in their compensation arrangement.

Committees to mitigate risks caused by an individual decision

In order to further balance the impact of market or credit risks caused to

the organization by an individual decision taken by a senior level
executive, MD & CEO or a whole time director, the bank, as a
promoted practice, has constituted various committees to take
decisions on various aspects.
Credit limits are sanctioned by committee at different levels.

Investment decisions of the Bank are taken and monitored by

Investment Committee and there is an upper limit cut in treasury
dealings where individual decisions can be taken.

Interest rates on Asset and liability products for different

buckets are decided and monitored by the ALCO. Banks’ exposure to
liquidity risk are also monitored by ALCO.

Compensation of risk control staff

Members of staff engaged in financial and risk control would be

compensated in a manner that is independent of the business areas they

F-168
 oversee and commensurate with their key role in the bank.. The mix of
fixed and variable compensation for control function personnel should
be weighted in favour of fixed compensation.

(d) Description of the ways in which the bank seeks to link performance
during a performance measurement period with levels of remuneration.

Compensation of MD & CEO, whole time directors and senior

executives (Non IBA) , performance linkage

The compensation paid out to the referred functionaries is divided into

two components

1. The fixed compensation is determined based on the industry

standards, the exposure, skill sets, talent and qualification
attained by the official over his/her career span.

2. The variable compensation for MD & CEO and senior executives

on Non – IBA package basis are fixed based on performance and
responsibility in the bank. The Bank’s performance is based on
the various financial indicators like revenue earned, cost
deployed, profit earned, NPA position and other intangible
factors like leadership and employee development. Variable
pay is paid purely based on performance.

Approval from RBI is to be obtained to decide compensation for MD &

CEO/ whole time directors. The payment of compensation also requires
approval of the shareholders of the Bank in the General Meeting
pursuant to the Bank’s Articles of Association read with the Section
197 of the Companies Act, 2013.

Compensation paid to Other Officers and staff members on IBA

package

The compensation paid to other officials that include Award staff,

Officers coming under Scale I to III and Senior executives coming
under Scale IV to VII is fixed based on the periodic industry level
settlements with Indian Bank Association. The variable compensation
paid to functionaries is based on the Performance Linked incentive
scheme which has been formulated on the basis of performance
parameters.

(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.

Deferred compensation and Performance Linkage (Non-IBA)

In the event variable compensation paid to MD & CEO, WTD’s,

Senior/other executives (Non IBA Package) ), the deferred period

F-169
 should not be less than three years. Compensation payable under
deferral arrangements should vest no faster than on a pro rata basis.

Clawback and deferral arrangements

The provisions of clawback and deferral arrangements applicable to the
referred functionaries (Non IBA Package) are subject to relevant
statutory and regulatory stipulations as applicable.

(f) Description of the different forms of variable remuneration (i.e. cash,

shares, ESOPs and other forms) that the bank utilizes and the rationale
for using these different forms.

Bank uses an optimum mix of cash, ESOPS and variable pay to decide
the compensation to MD & CEO /WTD and senior executives on Non –
IBA package. This is done to align the compensation of senior staff
with their performance, risk and responsibility taken in higher
assignments. Bank has to formulate a ESOP plan/scheme.

The Officers in Scale I-VII as well as Award staff come under the
purview of IBA package that is as per the Industry wide settlements.
The variable compensation paid to functionaries is based on the
Performance Linked incentive scheme which has been formulated on
the basis of performance parameters as may be prescribed from time to
time.

Current Year Previous Year

(upto Sept 14) (FY 2013-14)
Quantitative (g) Number of meetings held by the 2 Nil
disclosures Remuneration & Compensation Committee
(The quantitative during the half year and remuneration paid ` 100,000 Nil
disclosures should to its members.
only cover Whole (h) (i) Number of employees having Nil Nil
Time Directors / received a variable remuneration
Chief Executive award during the half year.
Officer / Other
Risk Takers) (ii) Number and total amount of sign-
on awards made during the half
year. Nil Nil

(iii) Details of guaranteed bonus, if Nil

any, paid as joining / sign on
bonus Nil
(iv) Details of severance pay, in Nil
addition to accrued benefits, if
any. Nil
(i) (i) Total amount of outstanding Nil Nil
deferred remuneration, split into
cash, shares and share-linked
instruments and other forms.
(ii) Total amount of deferred
remuneration paid out in the half
year. Nil Nil

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 (j) Breakdown of amount of remuneration
awards for the half year to show fixed ` 3.6 Million ` 7.5 Million
and variable, deferred and non-deferred
(on payment basis). Nil Nil

(k) (i) Total amount of outstanding Nil Nil

deferred remuneration and
retained remuneration exposed to
ex post explicit and / or implicit
adjustments.
(ii) Total amount of reductions
during the financial year due to
ex- post explicit adjustments. Nil Nil
(iii) Total amount of reductions
during the financial year due to Nil Nil
ex- post implicit adjustments.

5.16 Disclosures relating to Securitisation - Not applicable to the Bank at this stage.
5.17 Credit Default Swaps – Nil
5.18 Intra-Group Exposures - NA

5.19 Transfers to Depositor Education and Awareness Fund (DEAF)

Unclaimed liabilities where amount due has been transferred to DEAF is reflected as "Contingent
Liability - Others, items for which the bank is contingently liable" of the financial statements.
(` in Million)
Particulars 30.09.2014 31.03.2014
Opening balance of amounts transferred to DEAF Nil Nil
Add : Amounts transferred to DEAF during the half year 92.9 Nil
Less : Amounts reimbursed by DEAF towards claims Nil Nil
Closing balance of amounts transferred to DEAF 92.9 Nil

5.20 Unhedged Foreign Currency Exposure

(A) Provisioning
In terms of RBI Circular DBOD No.BP.BC.85/21.06.200/2013-14 dated 15th January 2014 and
subsequent clarification vide circular DBOD No.BP.BC.116/21.06.200/2013-14 dated 3rd June 2014,
the bank has estimated the liability of ` 8.1Million on Unhedged Foreign Currency Exposures. As
permitted in the said circular, bank has charged ½ of the same (` 4 Million) during the half year and the
remaining will be charged in the next half year.

(B) Capital Held

In terms of the aforementioned circulars, no additional capital is required to be held towards unhedged
foreign currency exposures.

F-171
6. Small and Micro 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.
There have been no reported cases of delays in payments to micro and small enterprises or of interest payments
due to delays in such payments. The above is based on the information available with the Bank which has been
relied upon by the auditors.
5. Comparative Figures

The figures for the previous period relates to the figures as at/ year ending 31st March 2014 and hence are not
comparable. The previous year’s/period’s figures have been regrouped and recast wherever necessary to
conform to current period’s classification.

F-172
 Annexure A-V
NOTES TO ADJUSTMENTS CARRIED OUT IN THE STATEMENT OF PROFIT & LOSS AND BALANCE SHEET

1. Wage Settlement

a. During the financial year 2010-11 the actual amount payable on account of wage settlement with employees
pertaining to the financial years 2007-08 to 2009-10, was crystallized at ` 345 million. As against this, aggregate
provision of ` 231.30 million was held comprising of ` 160 million for financial year 2008-09 and ` 71.30
million for the year 2009-10. The balance amount of ` 113.70 million after netting off the provision held, was
debited to the profit and loss account in the financial year 2010-11. This has been given effect to in the re-stated
profit and loss account in the respective financial years i.e. 2008-09 and 2009-10.

b. During the financial year 2013-14, on account of settlement of wage revision with employees which was due
with effect from 01.11.2012, a sum of ` 214.80 million was provided for as expenditure in the profit and loss
account. A sum of ` 60.90 million which was pertaining to the financial year 2012-13 (out of the said sum of `
214.80 million) was re-stated in the profit loss account for the financial year 2012-13.

2. Sick Leave and Unavailed Casual Leave

A sum of ` 29.33 million towards the provision for sick leave and ` 1.61 million towards unavailed casual leave
upto 31.03.2012 was provided for in the accounts upto 31.03.2012. In the financial year 2012-13 the said sum
was written back as the sick leave and unavailed casual leave was non encashable. In the re-stated profit and loss
accounts this has been given effect to in the financial years 2009-10, 2010-11, 2011-12 and 2012-13.

3. Business promotion expenses

Incentives paid to employees towards business promotion up to the financial year 2011-12 were grouped under
Payments to and Provision for Employees under Item 1 of Operating Expenditure. From the financial year 2012-
13 such expenditure was grouped under Item 9 – other expenditure of Operating Expenditure. In order to maintain
uniformity, the said amounts were restated as Other expenditure instead of Payments to and Provision for
Employees in the restated profit and loss account.

4. Matured Investments

Matured investments were grouped under ‘investments’ up to the financial year 2011-12. Corresponding
provision for depreciation of such investments were also grouped under the same heading. From the financial year
2012-13 the said investments were grouped under Other assets and the said provision under Other liabilities.
Accordingly in the re-grouped Statement of assets and liabilities the Matured investments and corresponding
provision has been re-stated under other assets and other liabilities up to the financial year 2011-12.

5. CEOs’ Travelling expenses

In the audited financial statements for the year 2013-14 travelling expenses of CEOs’ were grouped under Item 9
– other expenditure of Operating Expenditure. Up to the financial year 2012-13 the said travelling expense were
grouped under item 6 - Directors fees allowances and expenses of Operating Expenditure. Accordingly, in the
restated Profit & Loss account up to 2012-13 the travelling expenses of CEOs’ has been regrouped under other
expenditure instead of Directors fees allowances and expenses.

6. Reserves on Revaluation of Fixed assets

Balance in the Revaluation reserve being the amount of revaluation of fixed assets have been deducted from the
net fixed assets and Revaluation Reserves in the restated Statement of assets and liabilities as at 31.03.2010,
31.03.2011, 31.03.2012, 31.03.2013,31.03.2014 and as at 30th September 2014.

F-173
7. Change in the method of depreciation on Motor Vehicle.

The accounting policy on charging depreciation on motor vehicles was changed from Written Down Value
Method to Straight Line Method, with effect from 1.4.2014. Accordingly the financial results for the year ended
31.03.2010, 31.03.2011, 31.03.2012, 31.03.2013 and 31.03.2014 have been restated along with its corresponding
effect on account of profit/loss on sale of assets and depreciation.

8. Adjustment for Qualifications by Auditors in H1 of FY 2014-15

For H1 of Financial year 2014-15, Auditors had qualified the Auditors Report for not classifying two advance
accounts (aggregating to ` 1161.9 Million) as Non Performing Assets based on the RBI AFI of 31st March 2014,
requiring provision for NPA of ` 165 Million and interest reversal of ` 61.9 Million. While restating the
financials effect has been given to the qualification. Accordingly, loss for the period is higher by ` 114 Million
and deferred tax asset higher by ` 58.6 Million with consequential impact on Gross NPA and Net NPA.

F-174
 Annexure A-V (Continued)
(` in Million)
Table reflecting reconciliation of Audited Profit with Restated Profit

Half Year
Financial Year ended 31st March
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Net Profit after tax as per audited financial
16.54 121.76 259.01 326.66 268.80 (65.48)
statements
Increase / (decrease) in profit as a result of
adjustment for:
Adjustment of Wage Revision Arrears in the
respective years for which it relates based on
the actual calculation made after (82.08) 113.74
crystallization of the liability during the year
ended 31-03-2011
Adjustment of Wage Revision Arrears in the
respective years for which it relates based on (60.90) 60.90
the provision made for each year.
Adjustment for reversal of provision made (37.12) 4.39 2.37 (30.94)
for sick leave and unavailed casual leave
Adjustment in Depreciation due to change in
0.58 0.54 0.55 0.54 0.85 (2.97)
Depreciation method
Adjustment in Profit on sale of land, building
(0.18) (0.65) (0.81) (0.18) (0.15) (0.13)
& other assets
Adjustment on account of giving effect to
(172.63)
qualifications by auditors
Provision for taxes on account of restatement
40.38 (40.05) (0.68) 30.99 (20.94) 59.74
of financial statements.
Adjusted / Restated Net profit after tax (61.88) 199.73 260.44 266.17 309.46 (181.47)

F-175
 Annexure A-V (Continued)
(` in Million)
Table reflecting reconciliation of Audited profits available for appropriation with Restated profits
available for appropriation.

Half Year
Financial Year ended 31st March
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Opening Accumulated Profit available for
0.10 - - - - 19.70
appropriation as per audited financial statements
Increase / (decrease) in Opening Accumulated Profit
on account of arrears of wage revision, reversal of
provision made for sick leave and unavailed casual 20.91 (57.52) 20.45 21.87 (38.62) 2.04
leave, change in depreciation method and provision
for taxes on account of restatement of financial
statements as per current practice in r/o tax provisions
Add : current year profit available for appropriation as
16.54 121.76 259.01 326.66 268.80 (65.48)
per Audited Balance sheet
Increase / decrease in provisions and
appropriations as a result of adjustments for -
Adjustment of Wage Revision Arrears in the
respective years for which it relates based on the
(82.08) 113.74
actual calculation made after crystallization of the
liability during the year ended 31-03-2011
Adjustment of Wage Revision Arrears in the
respective years for which it relates based on the (60.90) 60.90
provision made for each year.
Adjustment for reversal of provision made for sick
leave and unavailed casual leave as per Auditors (37.12) 4.39 2.37 (30.94)
comment
Adjustment in Depreciation due to change in
0.58 0.54 0.55 0.54 0.85 (2.97)
Depreciation method
Adjustment in Profit on sale of land, building & other (0.18) (0.65) (0.81) (0.18) (0.15) (0.13)
assets
Adjustment on account of giving effect to (172.63)
qualifications by auditors
Provision for taxes on account of restatement of 40.38 (40.05) (0.68) 30.99 (20.94) 59.74
financial statements.
Adjusted / Restated balance of Accumulated Profit (40.87) 142.21 280.89 288.04 270.84 (159.73)
available for appropriation

F-176
 Annexure A-VI
Adjustments not carried out in the Statement of Restated P&L and Assets and Liabilities

1. Various guidelines / circulars / instructions and directions have been issued by The Reserve Bank of India
from time to time. Such guidelines / circulars / instructions have prescribed the effective date, method of
compliance, reporting, provisioning norms, disclosures etc. These being mandatory and statutory in nature,
have been given effect to in the financial statements as prescribed / directed from the date of its applicability.

2. In financial year 2010-2011, Bank had reopened the pension option for such of its employees (including
retirees) who had not opted for the pension scheme earlier. Also, in financial year 2010-11, the limit of
gratuity payable was also enhanced pursuant to the amendment to the Payment of Gratuity Act, 1972. In line
with RBI guidelines on the matter (as contained in RBI Cir.No.DBOD.BP.BC.80/21.04.018/2010-11 dated 9th
February 2011 on Reopening of Pension Option to Employees of Public Sector Banks and Enhancement of
Gratuity Limits – Prudential Regulatory Treatment, made applicable to the bank vide DBOD
No.BP.BC.15896/21.04.018/2010-11 dated April 08, 2011) Bank has done the following accounting in this
regard:

a. Pension cost relating to retired/separated employees amounting to ` 276.2 million has been fully
charged to Profit & Loss account of financial year 2010-11.
b. Pension cost relating to other employees amounting to ` 397.4 million is being amortised over a
period of 5 years starting from financial year 2010- 11.
c. Effect of enhancement in gratuity limit amounting to ` 207.4 million has been amortised over a period
of 5 years starting from financial year 2010-11.

Adjustments have not been done for the above while drawing the restated profit and loss account and balance
sheet.

3. In the financial statements of Financial year 2012-13, out of 408 branches / offices, 55 branches / offices have
not been audited and in respect of which the central statutory auditors carried out necessary review procedures
considered adequate by them. Approval of the Central Government as required u/s 228 of the Companies Act
1956 has not yet been obtained.

F-177
 Annexure A-VII
Summary of Significant Transaction with Related Parties (AS-18)
As per para 8.3.1 of RBI cir no DBOD.No.BP. BC. 89 /21.04.018/2002-03 dated March 29, 2003 -Guidelines on
compliance with Accounting Standards (AS) by banks, where the disclosures under the Accounting Standards are not
aggregated disclosures in respect of any category of related party i.e., where there is only one entity in any category of
related party, banks need not disclose any details pertaining to that related party other than the relationship with that
related party. Accordingly the following disclosures are made:

Financial Category of Period of

Sl No Name Designation
Year Related Party Relationship

Chairman & Chief Key Management 01.04.2009 to

1. Sr.R.Venkataraman 2009-10
Executive Officer Personnel 30.11.2009

Managing Director
Key Management 30.11.2009 to
2. Sri.V.P.Iswardas & Chief Executive 2009-10
Personnel 31.03.2010
Officer

Managing Director
Key Management 01.04.2010 to
3. Sri.V.P.Iswardas & Chief Executive 2010-11
Personnel 31.03.2011
Officer

Managing Director
Key Management 01.04.2011 to
4. Sri.V.P.Iswardas & Chief Executive 2011-12
Personnel 31.03.2012
Officer

Managing Director
Key Management 01.04.2012 to
5. Sri.V.P.Iswardas & Chief Executive 2012-13
Personnel 29.11.2012
Officer

Managing Director
Key Management 01.04.2013 to
6. Sri.Rakesh Bhatia & Chief Executive 2013-14
Personnel 31.03.2014
Officer

Managing Director
First Half Key Management 01.04.2014 to
7. Sri.Rakesh Bhatia & Chief Executive
of 2014-15 Personnel 30.09.2014
Officer

F-178
 Annexure- A-VIII

SEGMENT
REPORTING
PART A: BUSINESS
SEGMENT (` in Million)
FINANCIAL YEAR ENDED 31ST MARCH Half Year
ended
S. No. PARTICULARS 2010 2011 2012 2013 2014 30.09.2014
1 Segment Revenue
a) Treasury Operations 1654.90 1653.76 2187.84 2767.89 4100.93 2006.55
b) Corporate Banking 1640.55 2488.25 3951.46 3865.00 2907.98 1743.95
c) Retail Banking 3060.28 4075.28 5312.57 7378.92 9051.09 4330.72
d) Other Banking Operations 163.30 148.45 156.08 142.49 152.96 81.52
2 Segment Results
a) Treasury Operations (1119.85) (869.33) (873.38) (943.22) (1039.86) (754.56)
b) Corporate Banking 310.54 553.25 804.29 549.99 67.87 (18.78)
c) Retail Banking 705.52 749.36 994.08 1291.08 1955.73 1030.20
d) Other Banking Operations (9.40) 20.90 12.14 30.45 31.24 9.35
TOTAL (113.19) 454.18 937.13 928.30 1014.98 266.21
Unallocated expenses
Operating Profit (113.19) 454.18 937.13 928.30 1014.98 266.21
Provisions & Contingencies 84.66 161.58 640.09 600.84 546.00 542.33
Profit Before Tax (197.85) 292.60 297.04 327.46 468.98 (276.12)
Tax Provision (135.97) 92.87 36.60 61.29 159.52 (94.65)
Extra Ordinary Profit/ Loss
Net Profit (61.88) 199.73 260.44 266.17 309.46 (181.47)
3 Segment Assets
a) Treasury Operations 25658.93 24314.65 31934.33 35800.46 51849.02 51799.97
b) Corporate Banking 18647.25 29562.15 31354.74 29465.11 30177.70 32192.51
c) Retail Banking 26136.93 38097.66 49873.17 62901.32 63654.03 65498.96
d) Other Banking Operations 60.15 30.22 20.07 19.13 22.53 19.36
Unallocated Assets 5622.61 5591.96 6571.76 6300.32 5950.54 5983.48
Total Assets 76125.87 97596.64 119754.07 134486.34 151653.82 155494.28
4 Segment Liabilities
a) Treasury Operations 37.81 1076.00 3052.35 53.70 4330.04 4661.02
b) Corporate Banking 14463.07 22656.96 30022.31 41605.63 35232.01 37497.45
c) Retail Banking 56628.07 67174.23 79310.23 84294.34 103373.07 105475.30
d) Other Banking Operations 187.93 267.35 146.72 183.64 147.83 150.39
Unallocated Liabilities 1787.00 1657.04 2272.72 2549.29 2372.27 2150.77
Total Outside Liabilities 73103.88 92831.58 114804.33 128686.60 145455.22 149934.93
Net Worth 3021.99 4765.06 4949.74 5799.74 6198.60 5559.35

PART B: Geographic Segments

The Bank has no branches outside India.

F-179
 Annexure: A-IX

STATEMENT OF ADVANCE (Net)

(` in Million)
HALF
PARTICULARS FINANCIAL YEAR ENDED 31ST MARCH YEAR
ENDED
2010 2011 2012 2013 2014 30.09.2014
A [i] Bills Purchased & discounted 757.20 1,091.68 1,949.48 2,547.67 4,742.53 8,013.19
[ii] Cash Credit, Overdraft and
demand Loans 27,771.73 38,314.14 50,888.97 63,679.57 57,132.34 61,335.57
[iii] Term Loans 16,140.45 22,794.43 23,796.98 22,287.94 25,198.75 24,954.27
TOTAL 44,669.38 62,200.25 76,635.43 88,515.18 87,073.62 94,303.03

B [i] Secured by tangible assets

(Includes advances against book debts) 39,142.89 55,108.76 71,781.36 82,827.90 78,969.26 83,574.72
[ii] Covered by Bank/Government
guarantees 607.64 1,359.32 1,845.01 2,567.36 4,919.63 6,601.57
[iii] Unsecured 4,918.85 5,732.17 3,009.06 3,119.92 3,184.73 4,126.74
TOTAL 44,669.38 62,200.25 76,635.43 88,515.18 87,073.62 94,303.03
C. I. Advances in India
[i] Priority sector 15,056.31 21,514.23 25,886.23 19,138.16 25,579.92 31,029.18
[ii] Public sector 600.25 2,480.15 2,912.83 2,877.73 2,795.29 2,759.70
[iii] Banks - - 1,652.74 40.08 - -
[iv] Others 29,012.82 38,205.87 46,183.63 66,459.21 58,698.41 60,514.15
TOTAL 44,669.38 62,200.25 76,635.43 88,515.18 87,073.62 94,303.03
II. Advances outside India - - - - - -
GRAND TOTAL ( C.I and II) 44,669.38 62,200.25 76,635.43 88,515.18 87,073.62 94,303.03

F-180
 Annexure: A-X
STATEMENT OF INVESTMENT
(` in Million)
Financial Year ended 31st March
Sl. Half year
Particulars
No. 2010 2011 2012 2013 2014 ended
30.09.2014
Book Book Book Book Book Book
A Investments(Unquoted) Value Value Value Value Value Value
SLR Securities - - - - - -
Non SLR Securities - - - - - -
1 PSU Bonds 26.70 20.00 20.00 - 1,307.50 1,075.30
2 Mutual Fund( Debt Oriented) - - - - - -
Rural Infrastructure Development
3 Fund (RIDF) and Other Funds 3,248.00 2,997.80 2,219.40 1,552.70 3,802.30 3,937.50
4 Securities issued by ARC'S - - - - 1,206.50 2,194.80
5 Share 8.20 10.70 8.30 8.30 9.10 9.10
6 Other Securities - - - 40.00 40.00 40.00
Total (A) 3,282.90 3,028.50 2,247.70 1,601.00 6,365.40 7,256.70
B Investments (Quoted)
SLR Securities
1 GOI Treasury bills 1,301.80 2,232.70 2,146.40 245.50 2,832.80 5,919.80
2 GOI Securities(Dated) 16,121.60 18,875.70 24,937.40 28,157.70 30,381.80 30,856.10
3 State Govt. Securities(Dated) 587.30 637.10 836.80 1,145.50 1,869.40 2,312.30
4 Other approved Securites 27.66 5.60 - - - 2,400.00
Non SLR Securities
1 PSU Bonds 205.00 420.90 410.80 420.70 380.60 551.70
2 Bank Certificate of Deposits 1,266.40 1,247.70 493.30 987.00 9,059.80 1,601.50
3 Share 128.00 81.30 0.80 37.60 36.80 19.20
4 All others - 401.19 401.26 451.20 471.24 471.21
Total (B) 19,637.76 23,902.19 29,226.76 31,445.20 45,032.44 44,131.81
Total Gross Investment 22,920.66 26,930.69 31,474.46 33,046.20 51,397.84 51,388.51
Less: Prov. For Dep on
26.55 28.11 23.00 35.68 81.31 58.60
Investment
Total Net Investment 22,894.11 26,902.58 31,451.46 33,010.52 51,316.53 51,329.91
Investment ( Quoted) Mkt Value Mkt Value Mkt Value Mkt Value Mkt Value Mkt Value
SLR Securities
1 Treasury Bills 1,301.80 2,232.70 2,146.40 245.50 2,832.80 5,919.80
2 Central Govt. Securities 15,097.10 17,675.00 23,328.40 27,268.20 28,007.10 29,105.70
3 State Govt. Securities 564.10 609.10 809.30 1,151.50 1,761.00 2,230.40
4 Other Approved 28.70 5.80 - - - -
Non SLR Securities
1 PSU Bonds 217.70 424.00 409.50 415.20 365.00 553.30
2 Bank Certificate of Deposits 1,266.40 1,247.70 493.30 987.00 9,059.80 1,601.50
3 Share 107.90 62.20 - 12.10 11.60 9.30
4 All Others - 400.40 396.80 457.00 467.10 474.60
TOTAL 18,583.70 22,656.90 27,583.70 30,536.50 42,504.40 39,894.60

F-181
 ANNEXURE - B

STATEMENT OF DIVIDENDS DECLARED BY THE BANK ON EQUITY CAPITAL

(` in Million)

Financial Year ended Rate of Dividend (%) Total Dividend Paid

31.03.2010 Nil Nil
31.03.2011 10 31.58
31.03.2012 15 *47.04
31.03.2013 15 #62.77

31.03.2014 10 41.86
30.09.2014 Nil Nil

* The bank has declared dividend @ 15% on the share capital for the year 2012. Before approval of financial
results there had been forfieture of shares and the proposed dividend has taken only after considering the forfeiture
in the books of accounts.

# A sum of ` 62.21 Million has been appropriated from the restated profit and loss account for the year ended on
31.03.2013. The dividend appropriated is net of ` 0.56 million being the excess dividend proposed in the financial year
2011-12.

F-182
 ANNEXURE-C

SUMMARY OF ACCOUNTING RATIOS AS RESTATED

FINANCIAL YEAR ENDED 31ST MARCH Half year

PARTICULARS ended
2010 2011 2012 2013 2014 30.09.2014
Earnings per share ( Basic ) (`) (2.47) 6.43 6.99 7.13 7.39 (4.34)*
Earnings per share ( Diluted ) (`) (2.47) 6.43 6.99 7.13 7.39 (4.34)*
Return on net worth % (2.05%) 4.19% 5.26% 4.59% 4.99% (3.26%)*
Net asset value per equity share (`) 159.67 152.00 157.55 138.59 148.13 132.85
Weighted average number of equity shares
outstanding during the year / period (` in
Million) 25.04 31.07 37.27 37.31 41.85 41.85
Total number of shares outstanding at the end
of the year / period (` in Million) 18.93 31.35 31.42 41.85 41.85 41.85
* Not Annualized

The ratios have been computed as below:

Earnings per share (Rs) = Net profit / (Net loss) available to equity shareholders (after extra-ordinary items)
/ Weighted average number of equity shares outstanding during the year/period

Earnings per share calculations are done in accordance with Accounting Standard 20 ―Earnings per Share
notified under ―Companies (Accounting Standards) Rules, 2006

Return on net worth (%) = Net profit / (Net loss) after tax (after extra- ordinary items) / Net worth excluding
revaluation reserve at the end of the year/period

Net asset value per equity share (Rs) = Net worth excluding revaluation reserve, Deferred Tax Asset and
intangible assets at the end of the year/period / Number of equity shares outstanding at the end of the
year/period

F-183
 Annexure – D
CAPITALISATION STATEMENT AS RESTATED
(` in Million)

Pre Issue (As on 30th

PARTICULARS Post Issue#
September 2014)
Short Term Debt 4590.00 4590.00
Long Term Debt 739.40 739.40
Total Debt 5329.40 5329.40
Share Holders‘ Funds
Share Capital @ 418.99 [0]
- Reserves & Surplus * @ 5254.32 [0]
Total Shareholders‘ fund 5673.31 [0]
Long Term Debt / Share Holder Funds 0.13 : 1 [0]
Total Debt / Share Holder Funds 0.94 : 1 [0]

*Reserves & Surplus are arrived at after excluding the Revaluation Reserve & Deferred Tax Assets / Deferred
Revenue Expenditure.

@ After 30.09.2014 the bank has received an amount of ` 34.06 million as share capital on preferential allotment of
equity shares and ` 579.04 million towards share premium of the same. The bank has also undertaken rights issue of
equity shares and has received an amount of ` 150.84 million as share capital and ` 980.49 million towards share
premium of right shares. The share capital and reserves and surplus of the bank has increased to that extent after
30.09.2014.

# The corresponding post issue figures will be updated after completion of book building process.

F-184
 STATEMENT OF TAX SHELTER Annexure - E

As per Income Tax Return – Non Restated (` in Million)

Amount in Millions
Half Year
PARTICULARS Financial Year ended 31st March
Ended
2010 2011 2012 2013 2014 30.09.2014
Net Profit before Tax as per Audited
Statements (A) (79.05) 174.59 294.93 418.95 407.37 (100.39)
Normal Applicable Tax Rates (%) (B) 33.99 33.22 32.45 32.45 33.99 33.99
Tax as per actual rate on profits (C=A*B) - 57.99 95.69 135.93 138.47 -

ADJUSTMENTS
Permanent Difference
Deduction claimed u/s 36(1)(viii) of the Income
Tax Act - 37.40 55.22 83.62 - -

Total permanent difference (D) - 37.40 55.22 83.62 - -

Timing Difference
i) Difference between Tax and Book
Depreciation (10.57) (31.94) (21.71) (1.07) 19.97 (2.91)
ii) Provision for Bad and doubtful debts/Bad
debts written off 88.71 30.90 6.69 249.36 - -
iii) Interest accrued but not due on Investment - - 998.19 (165.00)
iv) Provision for leave benefits 21.01 (55.94) (36.19) (69.68) 33.42 (1.15)
v) Provision for Standard /restructured Assets - (36.86) (172.89) (200.09) 101.86 29.16
vi) Others 196.15 150.49 (2.49) (6.82) 120.90 (10.36)

Total timing difference (E) 295.30 56.65 (226.59) (28.30) 1,274.34 (150.26)
Total Adjustments (F=D+E) 295.30 94.05 (171.37) 55.32 1,274.34 (150.26)
Tax Saving thereon (G=F*B/100) 100.37 31.24 (55.60) 17.95 433.15 (51.07)
Taxable Profit (H=A-F) (374.35) 80.54 466.30 363.63 (866.97) 49.87
Carry Forward of Losses adjusted (I) - 80.54 293.81 - - 49.87
Net Taxable Profit (J=H-I) (374.35) - 172.49 363.63 (866.97) (0.00)
Total tax as per return (K=J*B) - - 55.96 117.98 - -
Carried Forward Business losses 276.63 196.26 - - 772.68 722.81
Carried Forward Unabsorbed Depreciation 97.72 97.55 - - 94.29 94.29
Total Carried Forward loss and unabsorbed
depreciation as per Return 374.35 293.81 - - 866.97 -

F-185
 STATEMENT OF BORROWINGS
Annexure-F
(` in Million)

Half Year
Financial Year ended 31st March
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Reserve Bank of India 250.00 2980.00 4190.00 4590.00
Under Repo
Other Banks/ CBLO 784.14 0.27
SIDBI / IDBI Refinance 0.73 0.36
NABARD Refinance 786.69 530.38 274.06 109.43 90.00
Others - NHB 500.00 909.00 545.00 181.00 72.95
Sub Total 0.73 2321.19 4419.65 819.06 4480.43 4752.95
Subordinated Debt for Tier II Capital 928.00 917.00 1335.00 1175.00 1075.00 575.00
Total 928.73 3238.19 5754.65 1994.06 5555.43 5327.95

F-186
 Annexure- G
Key Financial Indicators

(In Percentage unless otherwise stated)

S.No. PARTICULARS FINANCIAL YEAR ENDED 31ST MARCH HALF YEAR
2010 2011 2012 2013 2014 ENDED30.09.2014
1 Interest income/ Average working funds (AWF) 7.84% 8.68% 9.97% 10.27% 10.25% 5.00% *
2 Interest expenses/ AWF 6.18% 5.85% 7.13% 7.63% 7.66% 3.81% *
3 Interest spread/AWF 1.67% 2.83% 2.85% 2.64% 2.58% 1.20% *
4 Non Interest Income/AWF 1.00% 0.85% 0.79% 0.74% 0.80% 0.31% *
5 Operating Expenses/AWF 2.82% 3.16% 2.77% 2.65% 2.69% 1.33% *
6 Cost Income Ratio 105.75% 85.92% 76.11% 78.60% 79.56% 88.47%
7 Operating Profit/AWF -0.15% 0.52% 0.87% 0.72% 0.69% 0.17% *
8 Return on assets -0.08% 0.23% 0.24% 0.21% 0.21% -0.12% *
9 Yield on Advances 11.58% 11.52% 12.90% 13.03% 13.07% 6.40% *
10 Cost of Deposit 6.90% 6.45% 7.88% 8.47% 8.49% 4.18% *
11 Dividend pay out ratio (Including Corporate Dividend Tax) 0.00% 18.38% 21.14% 27.59% 15.82% 0.00%
12 Credit Deposit Ratio 65.12% 72.23% 73.25% 72.73% 64.75% 67.83%
Capital Adequacy Ratio
(BASEL II) 10.59 11.28 11.14 12.19 11.25 9.87
Tier I 7.84 9.48 8.89 9.52 9.27 7.96
13 Tier II 2.75 1.8 2.25 2.67 1.98 1.91
(BASEL III) 11.00 9.72
Tier I 9.08 7.87
Tier II 1.92 1.85
14 No. of employees 2681 2733 2651 2817 2840 3055
15 No. Of Branches 364 364 372 390 430 431
16 Business per employee (` in Million) 42.35 53.96 67.71 74.04 77.56 76.62
17 Operating Profit per employee (` in Million) -0.04 0.17 0.35 0.33 0.36 0.09 *
18 Net Profit / (loss) per employee (` in Million) -0.02 0.07 0.10 0.09 0.11 -0.06 *
19 Business per branch (` in Million) 311.95 405.13 482.52 534.81 512.29 543.06
20 Operating profit per branch (` in Million) -0.31 1.25 2.52 2.38 2.36 0.62 *
21 Net profit / (loss) per branch (` in Million) -0.17 0.55 0.70 0.68 0.72 -0.42 *
* Not Annualized

F-187
Definitions of Key Ratios
1 Interest income/ Average working funds (AWF)=Interest income as a percentage to monthly average of total assets
2 Interest expense/ Monthly average working funds (AWF)=Interest expense as a percentage to monthly average of total assets
3 Net interest margin/AWF =Net interest income(interest income- interest expense) as a percentage to monthly average of total assets
4 Non interest income/AWF =Non interest income as a percentage of monthly average of total assets
5 Operating expenses/Monthly AWF=Operating expenses as a percentage of monthly average of total assets
6 Cost income ratio=Operating expense as a percentage of net operating income i.e net interest income + other income
7 Gross( Operating profit)/Average working fund=Operating profit as percentage to monthly average working fund
8 Return on assets = Net profit as a percentage to monthly average working fund
9 Yield on advances=Interest received on advances as a percentage to fortnightly average of advance
10 Cost of deposit=Interest paid on deposits as a percentage to fortnightly average of deposits
11 Dividend pay out ratio (Including corporate dividend tax)= (Amount required for dividend + Tax)as a percentage to net profit
12 Credit deposit ratio=Gross advance/Deposit
13 CRAR = Capital funds percentage to risk weighted assets
16 Business per employee =(Deposits less interbank deposits + Advances) divided by no of employees less temporary employees)
17 Gross profit per employee =Gross profit divided by no of employees less temporary employees
18 Net profit per employee =Net profit/No of employees less temporary employees
19 Business per branch =Total business less inter bank deposits divided by no of branches
20 Gross profit per branch =Gross profit divided by no of branches
21 Net profit per branch = Net profit divided by no of branches

F-188
 Annexure H

Statement of Cash and Balances with RBI

(` in Million)

FINANCIAL YEAR ENDED 31ST MARCH Half Year

Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Cash in hand(including foreign currency notes) 548.37 597.37 661.02 846.80 720.21 904.26
Balances with Reserve Bank of India
[i] in Current Account 5308.00 5274.04 6203.74 5445.78 5518.82 5394.86
[ii] in Other Accounts 0.00 0.00 0.00 0.00 0.00 0.00
Total 5856.37 5871.41 6864.76 6292.58 6239.03 6299.12

F-189
 Annexure I

Statement of Balance with Bank and Money at Call and Short Notice
(` in Million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
I. In India
[i]Balances with banks
(a) in Current Accounts 133.78 180.90 111.23 147.86 137.36 127.39
(b) in Other Deposit Accounts 150.00 545.00 2325.00 3825.00 3500.50 200.42
Sub Total (i) 283.78 725.90 2436.23 3972.86 3637.86 327.81
[ii]Money at call and short notice
(a) with banks 0.00 0.00 0.00 0.00 0.00 0.00
(b) with other Institutions 499.67 0.00 0.00 0.00 0.00 0.00
Sub Total (ii) 499.67 0.00 0.00 0.00 0.00 0.00
TOTAL (i and ii) 783.45 725.90 2436.23 3972.86 3637.86 327.81
II. Outside India
(i) in Current Accounts 416.20 403.58 409.12 384.75 866.13 504.84
(ii) in Other Deposit Accounts 0.00 0.00 0.00 0.00 0.00 494.00
(iii) Money at call and short notice 0.00 0.00 0.00 0.00 0.00 0.00
TOTAL 416.20 403.58 409.12 384.75 866.13 998.84
GRAND TOTAL (I and II) 1199.65 1129.48 2845.35 4357.61 4503.99 1326.65

F-190
 Annexure J

Statement of Fixed Assets

(` in Million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Premises
At cost as on 31 st March of the preceding year 67.59 70.55 70.55 68.35 68.96 69.46
Appreciation on revaluation 458.46 458.46 458.46 1350.27 1350.27 1350.27
Additions during the year 2.96 0.00 0.40 0.60 0.51 0.19
Deductions during the year 0.00 0.00 2.59 0.00 0.00 0.00
Depreciation to date 86.92 95.35 102.17 116.35 132.15 139.67
Total 442.09 433.66 424.65 1302.87 1287.59 1280.25
Other Fixed Assets (including furniture and
fixtures)
At cost as on 31st March of the preceding year 811.45 849.36 869.35 932.01 1025.77 1108.16
Additions during the year 46.92 51.22 81.22 112.76 118.13 46.99
Deductions during the year 9.01 17.29 18.56 19.00 35.74 12.05
Depreciation to date 497.47 563.92 597.88 634.06 659.30 702.40
Total 351.89 319.37 334.13 391.71 448.86 440.70

Grand Total 793.98 753.03 758.78 1694.58 1736.45 1720.95

F-191
 Annexure K

Statement of Other Assets

(` in Million)

Half Year
FINANCIAL YEAR ENDED 31ST MARCH
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Interest accrued 443.83 480.99 706.18 713.68 1176.79 889.66
Tax paid in advance/tax deducted at source 348.66 314.30 388.10 185.16 281.05 106.69
Stationery and stamps 12.00 11.25 10.62 10.57 10.91 10.59
Non-banking assets acquired in satisfaction of
claims 15.95 15.19 110.95 119.04 164.72 165.51
Others 710.65 624.09 710.06 1324.56 654.43 1291.44
Total 1531.09 1445.82 1925.91 2353.01 2287.90 2463.89

F-192
 Annexure L

Statement of Deposits
(` in Million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
Demand Deposit 2,920.88 3,268.99 3,478.59 3,293.55 3,314.45 3,895.03
From Banks 6.05 12.19 14.49 3.88 5.32 2.51
From Others 2,914.83 3,256.80 3,464.10 3,289.67 3,309.13 3,892.52

Savings Deposits 14,605.94 16,242.46 17,004.97 18,340.40 20,295.38 21,553.38

Term Deposits 52,256.68 67,745.24 85,565.14 101,782.31 113,128.78 116,206.61

From Banks 1,671.39 2,804.42 4,213.90 4,594.61 4,989.09 3,681.08
From Others 50,585.29 64,940.82 81,351.24 97,187.70 108,139.69 112,525.53

Total Deposits 69,783.50 87,256.69 106,048.70 123,416.26 136,738.61 141,655.02

F-193
 Annexure M

Statement of Other Liabilities and Provisions

(` in Million)

Half Year
FINANCIAL YEAR ENDED 31ST MARCH
PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
I. Bills payable 187.93 267.35 146.72 183.64 147.83 150.39
II. Inter-office adjustments (net) 447.72 292.80 299.80 145.04 217.61 225.75
III. Interest accrued 416.74 412.31 581.53 549.02 641.07 650.79
IV. Others(including provisions) 1,339.26 1,364.24 1,972.93 2,398.58 2,154.67 1,925.03
Total 2,391.65 2,336.70 3,000.98 3,276.28 3,161.18 2,951.96

F-194
 Annexure N

Statement of Share Capital

(` in Million)

Half Year
FINANCIAL YEAR ENDED 31ST MARCH
PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
Authorized Capital :
8,00,00,000 Equity shares of Rs 10/- each
(`) 800.00 800.00 800.00 1000.00 1000.00 1000.00
20,00,000 Preference Shares of Rs.100/-
each (`) 200.00 200.00 200.00 200.00 200.00 200.00
Total 1000.00 1000.00 1000.00 1200.00 1200.00 1200.00
Issued and Subscribed Capital
Equity shares of Rs 10/- each (`) 315.79 315.79 315.79 418.47 418.47 418.47
Equity shares of Rs 10/- each (Nos) 31.58 31.58 31.58 41.85 41.85 41.85

Called-up Capital
Equity shares of Rs 10/- each (`) 315.79 315.79 315.79 418.47 418.47 418.47
Equity shares of Rs 10/- each (Nos) 31.58 31.58 31.58 41.85 41.85 41.85

Less: Calls in arrears 0.81 2.31 1.63 0.00 0.00 0.00

Less : Called up but not due 125.72 0.00 0.00 0.00 0.00 0.00
Add : Forfieted Shares 0.52 0.52 0.52

Share Capital 189.26 313.48 314.16 418.99 418.99 418.99

F-195
 Annexure O

Statement of Reserves and Surplus

(` in Million)
Half Year
FINANCIAL YEAR ENDED 31ST MARCH
PARTICULARS Ended
2010 2011 2012 2013 2014 30.09.2014
I Statutory Reserves
Opening balance 1215.48 1219.61 1250.05 1314.81 1396.47 1463.67
Additions during the year 4.13 30.44 64.76 81.66 67.20 0.00
Deductions during the year 0.00 0.00 0.00 0.00 0.00 0.00
Total 1219.61 1250.05 1314.81 1396.47 1463.67 1463.67
II Capital Reserves
Opening balance 301.47 305.08 311.19 315.65 397.06 529.69
Additions during the year 3.61 6.11 4.46 81.41 132.63 0.00
Deductions during the year 0.00 0.00 0.00 0.00 0.00 0.00
Total 305.08 311.19 315.65 397.06 529.69 529.69
III Revaluation Reserves
Opening balance 408.27 401.53 395.12 387.66 1267.12 1253.11
Additions during the year 0.00 0.00 0.00 891.81 0.00 0.00
Deductions during the year 6.74 6.41 7.46 12.35 14.01 6.66
Total 401.53 395.12 387.66 1267.12 1253.11 1246.45
IV Share Premium
Opening balance 862.98 868.05 2217.81 2224.42 2906.66 2906.66
Additions during the year 5.07 1349.76 6.61 682.24 0.00 0.00
Deductions during the year 0.00 0.00 0.00 0.00 0.00 0.00
Total 868.05 2217.81 2224.42 2906.66 2906.66 2906.66
V Revenue and other Reserves
Opening balance 905.94 914.69 962.89 1098.79 1189.20 1108.44
Additions during the year 14.59 49.52 142.93 96.83 15.79 0.00
Deductions during the year 5.84 1.32 7.03 6.42 96.55 0.00
Total 914.69 962.89 1098.79 1189.20 1108.44 1108.44
VI Balance in Profit and Loss
Account (57.52) 20.45 21.87 (38.62) 21.74 (165.28)

SUB TOTAL 3651.44 5157.51 5363.20 7117.89 7283.31 7089.63

Less: Revaluation Reserve 401.53 395.12 387.66 1267.12 1253.11 1246.45
Less: Deffered Revenue and
Issue Expenditure 417.18 310.81 339.96 470.02 250.59 702.82
TOTAL 2832.73 4451.58 4635.58 5380.75 5779.61 5140.36

F-196
 Annexure P

Statement of Contingent Liabilities

(` in Million)

FINANCIAL YEAR ENDED 31ST MARCH Half Year Ended

S.NO.
PARTICULARS 2010 2011 2012 2013 2014 30.09.2014
Claims against
the Bank not
1
acknowledged as
debt 40.82 39.36 50.16 52.26 56.01 72.57
Liability on
account of
2 outstanding
forward exchange
contracts 5,093.06 5,939.84 6,536.79 5,294.08 8,335.98 5,406.24
Guarantees given
3 on behalf of
constituents: - - - - - -
In India 985.05 1,495.40 2,169.10 2,496.31 2,081.02 2,096.30
Outside India - - - - - -
Acceptance,
4 Endorsement &
other obligations 525.67 630.66 850.18 621.56 812.62 1,037.70
Other Items for
which the Bank is
5
contingently
liable 200.41 320.96 158.40 102.84 94.89 187.36
TOTAL (F) 6,845.01 8,426.22 9,764.63 8,567.05 11,380.52 8,800.17
Bills for
G.
collection 792.77 725.28 754.39 809.20 721.29 763.54

F-197
 Annexure Q

Statement of Capital Adequacy

( In Percentage)
FINANCIAL YEAR ENDED 31ST MARCH Half Year
Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
(BASEL II) 10.59 11.28 11.14 12.19 11.25 9.87
Tier I 7.84 9.48 8.89 9.52 9.27 7.96
Tier II 2.75 1.80 2.25 2.67 1.98 1.91

(BASEL III) 11.00 9.72

Tier I 9.08 7.87
Tier II 1.92 1.85

F-198
 Annexure R

Statement of Non Performing Assets

(` in Million)

FINANCIAL YEAR ENDED 31ST MARCH Half Year

Particulars Ended
2010 2011 2012 2013 2014 30.09.2014
Gross NPA 1492.99 1924.55 1829.26 2108.69 3335.54 5345.77
Gross NPA (%) 3.29 3.05 2.35 2.35 3.77 5.56
Net NPA 705.20 1084.03 842.11 992.59 1932.42 3543.12
Net NPA (%) 1.58 1.74 1.10 1.12 2.22 3.76

F-199
 Annexure S

Statement of Other Income which exceeds 20% of NPBT

(` in Million)

Half Year
PARTICULARS FINANCIAL YEAR ENDED 31ST MARCH
Ended
Source of Income 2010 2011 2012 2013 2014 30.09.2014
Commission, Exchange & Brokerage 200.28 166.26 173.03 162.60 166.93 94.70
Profit on Sale of Investments (net) 128.53 52.14 52.78 228.88 440.97 82.13
Profit on Sale of Land, Buildings &
Other Assets (0.29) 5.33 12.27 4.57 0.88 (1.62)
Profit on Exchange Transactions 64.00 97.56 113.81 130.73 125.35 71.96
Miscellaneous Income 346.94 423.12 499.72 418.88 439.05 223.23
Total 739.46 744.41 851.61 945.66 1173.18 470.40

Break up of Miscellaneous Income

Bad Debts Written Off Recovered 44.21 95.14 151.95 38.60 34.43 0.91
Locker Rent Received 13.68 14.74 15.67 25.21 32.06 16.18
Rent Received(on Building Only) 0.19 0.25 0.22 0.22 0.24 0.10
Lease Rental Income 1.15 0.00 1.67 5.11 0.00 0.00
Processing Fee 110.22 140.19 141.10 129.12 162.77 101.46
Incidental Charges 91.60 90.77 103.01 120.91 118.13 75.10
Folio and Service Charges 81.41 75.81 80.33 78.77 81.88 29.19
Other Charges 4.48 6.22 5.77 20.94 9.54 0.29
Total 346.94 423.12 499.72 418.88 439.05 223.23
Note: Items mentioned here are generally recurring in nature and derived from normal business activities

F-200
 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS OF OUR BANK

You should read the following discussion and analysis of our Bank’s financial condition and results of operations
together with our audited financial statements, as restated, including the notes and schedules thereto included in the
section titled “Financial Information” on page 190. You should also read the section titled “Risk Factors” on page
13, which discusses a number of factors and contingencies that could impact our financial condition and results of
operations, and the sections titled “Our Business” and “Selected Statistical Information” on pages 127 and 221
which presents important statistical and other information about our Bank’s business.

This discussion contains forward-looking statements and reflects the current views of our Bank with respect to
future events and financial performance. Actual results may differ materially from those anticipated in these
forward-looking statements as a result of certain factors such as those set forth in the sections titled “Forward-
Looking Statements” and “Risk Factors” on pages 12 and 13, respectively. In this section, references to “we” and
“our” are to our Bank.

Our financial statements included in this Draft Red Herring Prospectus are prepared in accordance with Indian
GAAP, the Banking Regulation Act and guidelines issued by the RBI from time to time which differs in certain
material respects from IFRS and U.S. GAAP. Accordingly, the degree to which the financial statements in this Draft
Red Herring Prospectus will provide meaningful information to a prospective investor in countries other than India
is entirely dependent on the reader’s level of familiarity with Indian accounting processes.

The following discussion is based on our audited financial information as restated as of and for the fiscal years
ended March 31,2012, 2013, 2014 and the six months ended September 30, 2014.Our Bank does not have any
subsidiaries or affiliates and hence there are no separate consolidated financial information.

Our fiscal year ends on March 31 of each year, so all references to a particular “fiscal year” and “Fiscal” are to
the 12-month period ended March 31 of that fiscal year.

Overview

We are one of the oldest private sector banks in India with a history of over 94 years, and a strong base in Kerala
along with significant presence in Tamil Nadu, Karnataka and Maharashtra. We offer a wide range of products and
services, with particular focus on small and medium enterprises (“SME”), retail and NRI customers. We deliver our
products and services to our customers through multiple channels, including 431 branches (comprising five service
branches) and 232 ATMs spread across 15 states and four union territories and cater to an overall customer base of
1.61 million as on December 31, 2014.

While our Bank has a long operating history as a traditional bank, we are currently focusing on initiatives to
transform ourselves into a full service contemporary bank. To this end, we have recently undertaken a number of
initiatives to enhance our business focus by upgrading processes, technology and human resources. As part of our
transformation, we are in the process of organizing our operations under focused business areas; re-aligning,
training and incentivizing employees; creating new products and services; increasing sales and marketing efforts;
investing in technology and strengthening our monitoring and risk management policies.

We have four principal business areas, namely, (a) SME banking, (b) retail banking, (c) corporate banking, and (d)
treasury operations.

Under our SME banking business, we cater to small and medium manufacturing units, services and trading
companies, with borrowing needs up to ` 250 million. We offer a wide range of products including term loans, cash
credit, working capital finance, foreign currency loans, export credit, bill discounting, letters of credit and bank
guarantees. We believe that lending to SME customers enables us to diversify our credit risk due to relatively
smaller individual exposures. SMEs offer comparatively higher yields, cross-selling and associated business
opportunities, along with higher degree of secured and collateralized loans and also enable us to meet our priority
sector targets. As on December 31, 2014, our Bank has 382 branches in metro, urban and semi urban locations,
which we believe are conveniently located in close proximity to a large proportion of our existing and target SME

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customer base. Further, in order to reduce our turnaround time, we have decentralized our credit process by
establishing eight regional credit hubs for proposals within the lending power of the branches and zonal offices and
one central credit hub for proposals under the head quarter lending powers. As a percentage of our total advances,
loans to SME customers accounted for 33.41%, 40.40% and 43.18% as on March 31, 2013, March 31, 2014 and
September 30, 2014, respectively.

Under our retail banking business, we offer a wide range of loan and deposit products to our retail and NRI
customers, such as gold loans, loans against properties, personal loans, housing loans and agricultural loans, and
deposit products such as current accounts, savings accounts, term deposits and cumulative deposit accounts. Gold
loan advances constituted 38.31%, 32.04% and 29.54% of our total advances as on March 31, 2013, March 31, 2014
and September 30, 2014 and continues to be a mainstay for our Bank on the retail advances side. On the deposits
side, NRI deposits have been a stable source of funding for our Bank constituting 13.47%, 17.27% and 18.50% of
our total deposits as on March 2013, 2014 and September 30, 2014, and has grown at a CAGR of 33.43% during the
last three Fiscals. For facilitating fund transfer services required by our NRI customers, we have remittance and
rupee drawing arrangements with 14 exchange houses in the Middle East. We also have tie ups with major money
transfer agents including Wall Street Finance Limited, MoneyGram Payment Systems Inc, Weizmann Forex Ltd and
UAE Exchange & Financial Services Ltd, which enhances our capability to provide international remittance services
and strengthens our NRI business.

Our retail banking business also includes financial inclusion products, as well as fee income from distribution of
third-party products such as life insurance and general insurance. We distribute life insurance products of Edelweiss
Tokio Life Insurance Company Limited, and are in the process of finalizing an agreement with a leading general
insurance company for distributing general insurance products. As a percentage of our total advances, retail banking
advances accounted for 50.79%, 45.57%, and 43.66%, as on March 31, 2013, March 31, 2014 and September 30,
2014, respectively.

Under our corporate banking business, we cater to companies with an annual turnover of over ` 1,000 million (with
credit requirement of above ` 250 million). As a percentage of our total advances, corporate banking advances
accounted for 15.80%, 14.03%, and 13.16% as on March 31, 2013, March 31, 2014 and September 30, 2014,
respectively.

Our treasury operations primarily consist of statutory reserves management, liquidity management, investment and
trading, and money market and foreign exchange activities. Our treasury operations are aimed at maintaining an
optimum level of liquidity, while complying with the RBI mandated cash reserve ratio and the statutory liquidity
ratio. We maintain SLR through a portfolio of central Government, state Government, corporate debt and trustee
securities that we actively manage to optimize yield and benefit from price movements. We are also involved in the
trading of securities and foreign exchange, and invest in sovereign debt instruments, commercial papers, mutual
funds, certificates of deposits, floating rate instruments, bonds and debentures to manage short-term surplus liquidity
and further optimize yield and to generate profits thereon.

As on December 31, 2014, we have a network of 431 branches and 232 ATMs. Out of our 431 branches, 55
branches are in metropolitan cities, 102 branches in urban areas, 225 branches in semi-urban and 49 branches in
rural areas. For efficient administration, we have organized all our branches under nine zonal offices. We deliver
our products and services through multiple delivery channels that include branches, ATMs, internet and mobile
banking.

Our total assets have increased from ` 119,754.07 million as on March 31, 2012 to ` 134,486.34 million as on
March 31, 2013, to ` 151,653.82 million as on March 31, 2014, at a CAGR of 12.53%. Our total deposits have
increased from ` 106,048.70 million as on March 31, 2012 to ` 123,416.26 million as on March 31, 2013, to `
136,738.61 million as on March 31, 2014, at a CAGR of 13.55%. During the same period, our total advances have
increased from ` 77,676.90 million as on March 31, 2012 to ` 89,759.71 million as on March 31, 2013, and
decreased slightly from this level to ` 88,540.20 million as on March 31, 2014, at a CAGR of 6.76%. Our total
assets, total deposits and total advances as on September 30, 2014 are ` 155,494.28 million, ` 141,655.02 million
and ` 96,087.65 million respectively.

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Our total income (interest income plus other income) increased from ` 11,607.95 million in Fiscal 2012, to `
14,154.30 million in Fiscal 2013 to ` 16,212.96 million in Fiscal 2014, at a CAGR of 18.18%. During the same
period, our net profit after tax increased from ` 260.44 million in Fiscal 2012, to ` 266.17 million in Fiscal 2013, to
` 309.46 million in Fiscal 2014, at a CAGR of 9.01%. Our total income and net profit after tax for the six months
ended September 30, 2014 are ` 8,162.74 million and ` (181.47) million respectively. As on September 30, 2014,
our CRAR, Tier 1 Capital and Tier 2 Capital was 9.87%, 7.96% and 1.91% respectively as per Basel – II, and
9.72%, 7.87% and 1.85% respectively as per Basel – III. In order to augment our capital base, we raised ` 613.10
million through preferential allotment of Equity Shares to investors, in October 2014, followed by rights issue to
existing Shareholders in March 2015, where we raised Equity capital to the tune of ` 1,131.33 million.

Factors affecting our Financial Results

Our Bank’s asset portfolio, financial condition and results of operations have been, and are expected to be,
influenced by numerous factors, including but not limited to those described below. These are expected to affect the
overall growth prospects of our Bank, including its ability to expand its deposit base, the quality of its assets, the
level of credit disbursed by our Bank, the value of its asset portfolio and its ability to implement its strategy.

The Indian economy and credit environment

As a bank with principal business operations in the domestic Indian market, our financial condition and results of
operations are influenced by the general economic conditions prevailing in India. A slowdown in the Indian
economy could adversely affect our business and our borrowers, especially if such a slowdown were to be continued
and prolonged.

As reported by the RBI in its Financial Stability Report for December 2014, the growth of the Indian banking sector
moderated during Fiscal 2014. Profitability declined on account of higher provisioning on banks’ delinquent loans
and slow credit growth. The aggregate balance sheet of scheduled commercial banks in Fiscal 2014 registered a
decline in growth in total assets and credit for the fourth consecutive year. This decline could be attributed to several
factors including slower economic growth, de-leveraging, continuing pressure on asset quality leading to increased
risk aversion among banks as well as increasing recourse by corporates to non-bank financing including commercial
papers and external commercial borrowings.

In its 6th Bi-Monthly Monetary Policy Statement of February 2015, the RBI stated that domestic economic activity
was likely to have remained subdued in the third quarter of Fiscal 2015, reflecting shortfall in the kharif harvest
relative to the last year. Agricultural growth was forecasted to grow in the last quarter of Fiscal 2015. While there
was a broad based improvement in industrial activity in November 2014, continuing contraction in consumer goods
production was analysed to underscore the persisting weakness in consumption demand. Retail inflation, measured
by year-on-year changes in the CPI edged up in December 2014 on the expected reversal of favourable base effects
that had tempered upside pressures since June. In the fuel category, prices of constituents such as electricity, coal
and cooking gas remained stable in the absence of administered revisions. Consequently, the CPI registered a
monthly decline for the first time since February 2014.

Active liquidity management operations under the revised framework adopted in early September ensured that
liquidity conditions generally remained comfortable. Money market rates evolved in close alignment with the policy
repo rate, excluding occasional pressures around days of advance tax outflows and quarter-end tightness. Overnight
variable rate repo/reverse repo auctions announced early in the day give markets advance intimation of the RBI’s
assessment on system-wide liquidity needs for the day, allowing fine tuning of liquidity. The average daily net
borrowings under the LAF (including term repos, reverse repos and marginal standing facility) were around `850
billion in December and January.

In terms of RBI’s “Result of the Survey of Professional Forecasters on Macroeconomic Indicators (32 nd Round)”
(released on February 3, 2015), the forecast of real GDP growth (at factor cost) was 5.4% for Fiscal 2015, while the
real GDP growth forecast for Fiscal 2016 was estimated to be 6.4%. Money supply growth for Fiscal 2015 is
expected to be 13.2% in Fiscal 2015 and expected to grow to 14.00% in Fiscal 2016. Bank credit is expected to
grow by 13.9% and 15.00% in Fiscals 2014 and 2015, respectively. In terms of long term forecasts, average GDP
growth from Fiscal 2015 to Fiscal 2019 is expected to grow to 6.8% in the next five years. The gross domestic

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saving rate is projected to be at 30.70% of the GDP in Fiscal 2015 and is expected to improve to 31.30% in Fiscal
2016. The repo rate is projected to be at a median of 7.75% in Fiscal 2015 and 7.25% in Fiscal 2016. Additionally,
the bank credit of scheduled commercial banks is projected to grow at a median of 13.9% in Fiscal 2015 and 15.00%
in Fiscal 2016.

According to the Monthly Economic Report for January 2015 prepared by the Department of Economic Affairs,
Ministry of Finance, Government of India, the average WPI inflation rate for the last 12 months (February 2014 to
January 2015) was 3.4% as compared to 6.1% during the corresponding period in Fiscal 2013. There is no assurance
that inflation will not further increase in the future. In periods of high rates of inflation, our costs, such as operating
expenses, may increase, which could have an adverse effect on our results of operations.

Inflation may also have a bearing on the overall interest rates which may adversely affect our net interest income.
High rates of inflation in the Indian economy have impacted and could continue to impact our Bank’s ability to
sustain profitable net interest margins because it could lower the demand for loans or require the Bank to increase
the costs of its deposits. In response to elevated inflation, in Fiscals 2011 and 2012, the RBI increased its policy
rates 13 times, announcing gradual increases in the repo rate from 5.00% on March 31, 2010 to a peak of 8.50%
with effect from October 25, 2011. The repo rate was however been reduced to 7.50% with effect from March 13,
2015. The reverse repo rate has been pegged at 1.0% below the repo rate since March 2011 and thus has followed a
similar trend since that time and was 6.50% with effect from March 13, 2015.

The growth prospects of our business, including the quality of our assets and our ability to grow our asset portfolio
and implement our strategy, are influenced by the growth rate of the economy as a whole, the economic cycle and
the health of the capital markets. The level of credit disbursed, recovery of loans and demand for loans are all
affected by these factors. Any slowdown in the growth of the Indian economy or the economies of other countries,
coupled with inflationary pressures, could adversely impact our business, the business sectors that we are targeting
as growth areas and the financial standing and growth plans of our borrowers and contractual counterparties.

Regulations governing the Indian banking industry

Our operations are regulated extensively by the RBI. The RBI is actively involved in the management of the Indian
economy. Accordingly, we are subject to:

 Two categories of statutory reserve requirements: Cash Reserve Ratio (“CRR”) and Statutory Liquidity
Ratio (“SLR”). Under these requirements, all banks are required to maintain a certain stipulated proportion
of their net demand and time liabilities (“NDTL”) in the form of cash, gold, balances with RBI, current
account balances with other banks and unencumbered Government and/or other approved securities. The
basic objective of the CRR and the SLR requirements is to ensure that banks hold sufficient liquid
resources to meet any unexpected contingencies. At present the required CRR is 4%, while the stipulated
SLR is 21.50%. Further, in December 2011, the RBI has permitted banks to avail funds from the RBI on an
overnight basis, under the marginal standing facility, against their excess SLR holdings. Additionally, they
can also avail themselves of funds, on an overnight basis below the stipulated SLR, up to 2% of their
respective NDTL outstanding at the end of the second preceding fortnight. Any increase in the CRR and/or
the SLR requirements from the current levels could affect our ability to deploy our funds or make
investments, which could in turn have a negative impact on our results of operations.

 Requirements to lend to certain priority sectors: In terms of the RBI’s Master Circular on Priority Sector
Lending – Targets and Classifications dated July 1, 2014 (“Priority Lending Circular”), priority sectors
for scheduled banks are: (i) agriculture; (ii) micro and small enterprises; (iii) education; (iv) micro credit;
(v) housing; (vi) export credit; and (vii) certain other loans as specified in the Priority Lending Circular.
Each of the priority sectors has associated sub-limits. Under the Priority Lending Circular, the priority
sector lending targets are linked to ANBC (net bank credit plus investments made by banks in non-statutory
liquidity bonds included in the Held To Maturity category and not taking into account the re-capitalisation
bonds floated by the Government) or credit equivalent amount of off-balance sheet exposure, whichever is
higher, as on March 31 of the previous year. Currently, the total priority sector lending target for domestic
banks is 40% of ANBC or credit equivalent amount of off-balance sheet exposure, whichever is higher.

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 Requirements restricting lending in certain specified sectors, including

(i) real estate: the RBI stipulates that the borrower obtains prior permission from the central
government/ local government/ other statutory authority over the relevant real estate project prior
to lending to a real estate project;
(ii) commodities: the RBI stipulates specific restrictions on bank advances against specified sensitive
commodities, such as food grains, selected major seed oils, raw cotton, sugar/ gur and cotton
textiles, including restrictions in relation to minimum margin, valuation of commodity stocks,
interest rates and other operational stipulations; and
(iii) capital markets: the RBI stipulates numerous restrictions, including uniform margin for financing
of capital markets transactions, minimum cash margins for guarantees and restrictions relating to
loans sanctions to companies against the security of shares.

 RBI's prudential norms in respect of income recognition, asset classification and provisioning: Any changes
in the regulatory framework regarding provisioning for NPAs could adversely affect our profitability and
consequently our net worth. For further details, see the section titled “Regulations and Policies –
Prudential norms on income recognition, asset classification and provisions pertaining to advances” on
page 152.

The Government’s monetary policy is heavily influenced by the condition of the Indian economy, and changes in
the monetary policy affect the interest rates of our advances and deposits. The RBI responds to fluctuating levels of
economic growth, liquidity concerns and inflationary pressures in the economy by adjusting the monetary policy. A
monetary policy designed to combat inflation typically results in an increase in RBI lending rates. Further, in
addition to having gradually established more stringent capital adequacy requirements, the RBI has also instituted
several prudential measures to moderate credit growth including increase in risk weights for capital adequacy
computation and general provisioning for various asset classes. For further information, see the section titled
“Regulation and Policies” on page 149.

Interest rates and cost of funds

Our interest income is a significant component of our revenues. Interest income represents the interest earned from
interest-bearing assets (advances/bills, balances with the RBI and other inter-bank funds and investments). In the six
months ended September 30, 2014, and for Fiscal 2014, income from interest earned was ` 7,692.34 million and `
15,039.78 million, respectively, which constituted 94.23% and 92.76% of our total income in such periods. Changes
in interest rates affect the rates we earn on our interest-bearing assets and that we pay on our interest-bearing
liabilities. Since July 2010, the RBI implemented a new base rate mechanism designed to move Indian banks closer
to a market-based interest rate regime, with each bank in India required to publicly disclose its own minimum rate,
or “base rate,” for all new and existing loans and advances which are due for re-pricing, subject to certain limited
exceptions. Under this new base rate system, banks must review and revise their base rates at least once per quarter.

Indian banks generally follow the direction of interest rates set by the RBI and adjust both their deposit rates and
lending rates upwards or downwards accordingly, subject to a published minimum base rate. Decreases in the RBI
policy rates would signal Indian banks to re-examine their base rate and lending rates which could affect our interest
income. Conversely, increases in the RBI policy rates could affect the ability of potential borrowers to avail loans
despite partly mitigating higher deposit costs. For further details, please see sections titled “Risk Factors – Our
business is vulnerable to interest rate and investment related risks. Volatility in interest rates, value of investments
and other market conditions could adversely affect our net interest margin, the value of our fixed income portfolio,
our security receipts, our income from treasury operations, the quality of our loan portfolio and our financial
performance” and “Selected Statistical Information” on pages 18 and 221, respectively.

In addition, yields on government and approved investments, as well as yields on our other interest earning assets
are dependent on interest rates. In case of a sharp and sustained increase in interest rates, we could be adversely
affected by the decline in the market value of our government securities portfolio and other fixed income securities.
A fall in interest rates, on the other hand, would enhance the market value of our government securities portfolio and
other fixed income securities.

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Our primary interest-bearing liability is our deposit base. Our ability to offer lower interest rates for our customers’
deposit accounts depends significantly on our ability to provide such customers with convenient banking services
that make up for lower returns on deposits. To continue to source low-cost funding through deposits, we must,
among other things, focus on increasing our brand recall, continuing to develop innovative products to serve
customers, enact marketing strategies that support these products, continue to develop our information technology
systems to offer modern banking services and develop products and services to distinguish ourselves in an
increasingly competitive industry. However, the increasing competition for funding, increasing interest rates and
changes to the RBI’s liquidity and reserve requirements may increase the rates that we pay on our deposits and in
turn affect our profitability.

Competition in the Indian banking industry

We operate in a highly competitive environment, and face competition from public and private sector Indian
commercial banks and foreign commercial banks in all our products and services. We also face competition in some
or all of our products and services from NBFCs, post office savings schemes, exchange houses, micro-financing
institutions, co-operative banks and other entities operating in the financial sector.

Further liberalization of the Indian financial sector could also lead to a greater presence or new entries of Indian and
foreign banks offering a wider range of products and services, which could adversely affect our competitive
environment. For instance, the RBI has come out with a set of guidelines for licensing of new banks in the private
sector in February 2013. The process of licensing culminated with the granting of “in-principle” approval to two
applicants to set up new banks in the private sector within a period of 18 months.

Additionally, the RBI is working on a policy of having various categories of “differentiated” bank licenses which
will allow a wider pool of entrants into banking. Guidelines for licensing of entities as payment banks and small
finance banks have been issued in November 2014 to enhance financial inclusion. Our business and operations could
be significantly impacted by the increasing registration of small finance banks and payment banks.

We also compete with foreign banks with operations in India. In November 2013, the RBI released a framework for
the setting up of wholly owned subsidiaries in India by foreign banks. The framework encourages foreign banks to
establish a presence in India by granting rights similar to those received by Indian banks, subject to certain
restrictions and safeguards. Under the current framework, wholly owned subsidiaries of foreign banks are allowed to
raise rupee resources through issue of non-equity capital instruments. Further, wholly owned subsidiaries of foreign
banks may be allowed to open branches in Tier 1 to Tier 6 centres (except at a few locations considered sensitive on
security considerations) without having the need for prior permission from RBI in each case, subject to certain
reporting requirements. The guidelines may result in increased competition from foreign banks.

Our future success will depend in large part on our ability to respond in an effective and timely manner and our
ability to compete effectively. Increased competitive pressure may have an adverse impact on our business, financial
condition and results of operations.

Growth in the SME and retail segment

We have traditionally targeted the SME and the retail segments. Lending to the SME sector enables us to diversify
our credit risk profile due to the smaller individual exposure reducing systemic risks. SMEs offer comparatively
higher yields, associated business/ cross-selling opportunities and higher degree of secured/ collateralised loans. Our
advances to SME customers have grown from ` 29,986.10 million in Fiscal 2013 to ` 35,770.63 million in Fiscal
2014 which constituted 33.41% and 40.40% of our total advances for the same periods.

In the retail segment, we have a significant gold loan portfolio and NRI deposit portfolio. Gold loans constituted
29.99%, 38.31%, 32.04% and 29.54% of our total advances in Fiscals 2012, 2013, 2014 and for six months ended
September 30, 2014. Apart from being safer products by virtue of the liquidity of the underlying security, gold loans
offer other benefits such as easy lending and less operational cost. Further, NRI deposits have been a stable source
of funding for the Bank over the years, growing at a CAGR of 33.43% over the last three Fiscals.

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Our network has also been selectively augmented to focus on the SME and retail segments. Going forward, we
expect a significant portion of our business and revenues to continue to be derived from our exposure to the SME
and retail segment, and consequently, any downturn in these segments, occasioned by macro or micro-economic
circumstances, deterioration of asset quality, low recoveries or any other circumstances may adversely affect our
interest income.

Ability to manage credit, market and operational risk

Our ability to continue to reduce or contain the level of our gross and net NPAs may be affected by a number of
factors that are beyond our control, such as increased competition, a recession in the economy, including in respect
of specific industries to which we are exposed, decreases in agricultural production, decline in commodity prices,
adverse fluctuations in interest and exchange rates or adverse changes in the Government of India’s policies, laws or
regulations. In addition, the expansion of our business may also cause the level of our NPAs to increase. Future
increases in NPAs may have an adverse effect on our business, prospects, financial condition and results of
operations.

The credit quality of our loan portfolio is a key driver of our results of operations, as quality loans help reduce the
risk of losses from loan impairment. Our net NPAs were ` 842.11 million, ` 992.59 million, ` 1,932.42 million and
` 3,543.12 million for Fiscals, 2012, 2013, 2014 and for six month ended September 30, 2014, respectively, while
our gross NPAs were ` 1,829.26 million, ` 2,108.69 million, ` 3,335.54 million and ` 5,345.77 million,
respectively, for Fiscals, 2012, 2013, 2014 and for six month ended September 30, 2014. Our Net NPAs to Net
Advances ratios were 1.10%, 1.12%, 2.22% and 5.56% as of March 31, 2012, 2013 and 2014 and the six months
ended September 30, 2014, respectively, while our gross NPA ratio was 2.35%, 2.35%, 3.77% and 3.76% for the
same periods.

The level of our NPAs is a function of the credit quality of our loans, which is further dependent upon the credit
appraisal processes and recovery procedures adopted by us. We have enterprise-wide risk management systems to
manage credit risk, market risk and operational risk. We monitor credit risk at the transaction level as well as the
portfolio level. Our ability to reduce or contain the level of our gross and net NPA ratios may be impacted by a
number of factors beyond our control, such as increased competition, depressed economic condition, including with
respect to specific industries to which we are exposed, decreases in agricultural production, increases or decreases in
commodity prices, adverse fluctuations in interest and exchange rates or adverse changes in Indian policies, laws or
regulations and also on our ability to manage our risk.

Basel III implementation

The RBI has extended the end date for full implementation of Basel III capital regulations by one year (to March 31,
2019) to provide some lead time to banks on account of potential stresses on asset quality and consequential impact
on the performance and profitability of the banks. With such extension, full implementation of Basel III in India will
slightly exceed the internationally agreed end date of January 1, 2019. With regard to the introduction of
countercyclical capital buffers (“CCCB”) in India, the RBI notified the final guidelines in February 2015. While the
framework for CCCBs is already in effect, the activation of CCCBs are expected to be implemented under
appropriate circumstances.

Ability to increase our income from commission, exchange and brokerage, processing fees, incidental charges
and folio and other service charges

Our ability to improve profitability will depend, among other factors, on our success in increasing our non fund
based income from existing and new customers. In order to grow our other income, we distribute third-party
investment products, such as insurance products. We distribute life insurance products of Edelweiss Tokio Life
Insurance Company Limited, and are in the process of finalizing an agreement with a leading general insurance
company for distributing general insurance products. We intend to improve our non-fund-based portfolio, including
letters of credit and bank guarantees and to improve our foreign exchange-related products and services portfolio.
Our income from commission, exchange and brokerage, processing fees, incidental charges and folio and service
charges constituted 58.42%, 51.96%, 45.15% and 63.87% of our total other income for Fiscals 2012, 2013, 2014 and
for six month ended September 30, 2014, respectively.

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We intend to continue to bring innovative products to the market and improve cross-selling efforts in order to
enhance fee based income. However, the increasing sophistication of our customers, offerings of similar products
and services by our competitors and changes in the regulatory environment could adversely impact our ability to
grow our fee based income.

Our ability to manage costs and expenses

Our ability to control costs is important to our overall profitability. In the recent past, the growth in our operating
costs was higher due to expenditures like increase in dearness allowances for employees, provision for salary arrears
towards expected wage revisions and additional provisions towards expected escalation in retirement benefits of
employees. The average age of our employees is 42 years, and consequently, we are likely to incur higher costs for
payments and providing for retirement benefits for our employees. Further, as interest expenditure is one of the main
costs, we have formulated strategies to improve our CASA balances and are making continuous efforts to reduce our
cost of deposits and cost of borrowings by reviewing the asset liability mismatches through our ALCO by suitably
adjusting the interest rates where possible. We will also be making efforts to improve employee productivity and
effecting improvements in our infrastructure and technology platform and centralizing processing of our operations
in select areas. We will continue, however, to face many challenges in controlling our costs as we continue to
increase our distribution network, add new products/services and increase our business volume. Additionally, we
expect our operating expenses on account of payment to and provision for employees to increase significantly after
the implementation of the 10th Bipartite Wage Revision Settlement between the management of A Class Scheduled
Banks like us (represented by the IBA) and their workmen (represented by various labour unions and officers’
associations) (“10th Bipartite Settlement”). As at February 2015, the terms of the 10 th Bipartite Settlement as
mutually agreed between the parties include a 15% annual wage increase in salary and allowances for employees of
A Class Scheduled Banks (on salary slip components) effective (when implemented) from November 1, 2012 and
every second and fourth Saturday to be designated as a holiday, and the other Saturdays designated as full working
days. An inability to effectively manage such cost and expense escalations could affect our income and profitability.

Significant Accounting Policies

1. General

a) Our financial statements have been prepared in accordance with the requirements prescribed
under the Third Schedule (Form A and Form B) of the Banking Regulation Act, 1949. The
accounting and reporting policies of our Bank used in the preparation of these financial statements
confirm to Generally Accepted Accounting Principles in India (Indian GAAP), the guidelines
issued by the Reserve Bank of India (RBI) from time to time, the Accounting Standards (AS)
issued by the Institute of Chartered Accountants of India and referred to in the Companies Act,
2013 so far as they apply to our Bank and practices generally prevalent in the banking industry in
India.

b) Historical cost convention and Accrual basis of accounting have been consistently applied while
preparing and presenting the financial statements, unless otherwise stated.

2. Use of estimates

The preparation of our financial statements, in conformity with generally accepted accounting principles,
requires management to make estimates and assumptions that affect the reported amounts of assets and
liabilities, revenues and expenses and disclosures of contingent liabilities at the date of the financial
statements. Our management believes that the estimates used in the preparation of the financial statements
are prudent and reasonable. Future results could differ from these estimates. Any revision to accounting
estimates is recognized prospectively in current and future periods.

3. Transactions involving foreign exchange

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 a) Monetary assets and liabilities including contingent liabilities have been translated at the
exchange rates prevailing at the close of the half year as advised by FEDAI and the effect is
accounted in Profit & Loss Account.

b) Income and Expenditure items denominated in foreign currencies have been accounted at the
exchange rates prevailing on the date of transaction.

c) Outstanding foreign exchange forward contracts are revalued at the rates applicable on the closing
date as advised by FEDAI. The resultant profit/loss is taken into Profit and Loss Account.

d) Contingent Liabilities on guarantees, letters of credit, acceptances and endorsements are reported
at the exchange rates prevailing at the close of the half year.

4. Investments

a) Accounting and classification

All Investments are accounted for on settlement dates. In terms of RBI guidelines, the entire
investments portfolio has been classified under three categories for valuation purpose, viz., “Held
to Maturity”, “Available for sale” and “Held for Trading” at the time of its purchase. However,
for disclosure in the Balance Sheet, investments are classified under six groups – Govt. Securities,
Other Approved Securities, Shares, Debentures and Bonds, Subsidiaries/Joint Venture and Others.

b) Cost of acquisition

Costs such as brokerage pertaining to investments, paid at the time of acquisition are charged to
the profit and loss account.

c) Basis of Classification

Securities that are held principally for resale within 90 days from the date of purchase are
classified under the HFT category. Investments that our Bank intends to hold till maturity are
classified under the HTM category. Securities which are not classified in the above categories are
classified under the AFS category.

d) Transfer between categories

Reclassification of investments from one category to the other, if done, is in accordance with the
RBI guidelines. Transfer of scrips from AFS/HFT category to HTM category is made at the lower
of book value or market value. In the case of transfer of securities from HTM to AFS/HFT
category, the investments held under HTM at a discount are transferred to AFS/HFT category at
the acquisition price and investments placed in the HTM category at a premium are transferred to
AFS/HFT at the amortized cost. Transfer of investments from AFS to HFT or vice versa is done at
the book value. Depreciation carried, if any, on such investments is also transferred from one
category to another.

e) Valuation of Securities

(i) Investments in “Held to Maturity” category are accounted for at acquisition cost or at
amortised cost, if acquired at a premium. In case the cost is higher than the face value,
the premium is amortised over the period remaining to maturity using Constant Yield
Method. Such amortisation of premium is adjusted against income under the head
“Income on Investments”. Where the face value is higher than the cost, the discount is
ignored and is accounted only on maturity date of the instrument.

(ii) Securities classified as “Available for Sale” are marked to market scrip-wise on a

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 quarterly basis and net depreciation in each category is provided for, while net
appreciation is ignored.

(iii) Individual scrips in “Held for Trading” category are marked to market at daily intervals
and net depreciation in each category is provided for, while net appreciation is ignored.

(iv) Treasury Bills and Certificate of Deposits are valued at carrying cost.

(v) Security receipts are valued as per the Net Asset Value (NAV) obtained from the issuing
Reconstruction Company/Securitisation Company.

(vi) Profit on sale of investments in ‘Held to Maturity’ category is recognised in the Profit
and Loss Account and an equivalent amount net of taxes and transfer to Statutory
Reserves is appropriated to Capital Reserve.

(vii) Investments are also classified as Performing and Non Performing as per the guidelines
of RBI and provisions on Non Performing investments are made as per the provisioning
norms of RBI.
5. Advances

a) Advances are classified as Performing and Non Performing based on the relevant RBI guidelines.
The amount of advances shown in the Balance Sheet is net off provisions and interest suspense.

b) Provision on Standard Assets is maintained as per RBI guidelines and the same is included in
Other Liabilities & Provisions.

c) Amounts recovered against debts written off in earlier years are recognised as revenue.

d) The sale of financial assets (including Non Performing Advances) to Reconstruction Company
(RC)/ Securitisation Company (SC) are accounted as per the extant guidelines of Reserve Bank of
India from time to time.

6. Fixed assets and depreciation

a) Fixed Assets other than premises are carried at cost less accumulated depreciation. Cost includes
cost of purchase and all directly attributable costs of bringing the asset to its working condition for
its intended use.

b) Premises are stated at revalued amount. Appreciation on revaluation of premises is credited to

Revaluation Reserve. The additional depreciation on the revalued portion of buildings is charged
to Profit and Loss account and an equivalent withdrawal is made from Revaluation Reserve
Account.

c) Subsequent expenditure incurred on fixed assets put to use is capitalized only when it represents
an improvement which increases the future benefits from the existing asset beyond its previously
assessed standard of performance or an extension which becomes an integral part of the asset.

d) Depreciation on additions to fixed assets is provided on pro rata basis.

e) The useful life for computation of depreciation for various categories of Fixed Assets are as
follows:

Type of Fixed Asset Useful life (Yrs) Depreciation Method

Building 58 Yrs Written Down Value
Motorcars 8 Yrs Straight Line
Furniture & Fixtures 10 Yrs Straight Line

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 Type of Fixed Asset Useful life (Yrs) Depreciation Method
Plant & Machinery 15 Yrs Straight Line
Servers & Networks 6 Yrs Straight Line
Other Computer Hardware 3 Yrs Straight Line
ATMs 8 Yrs Straight Line

7. Intangible Assets

Accounting and amortisation of Computer Software are in accordance with the provisions of Accounting
Standard 26 – Intangible Assets, issued by Institute of Chartered Accountants of India (ICAI).

a) Application Software purchased is amortised over a period of 5 years on pro rata basis under
Straight Line Method.
b) Internally Generated Application Software is accounted as an intangible asset and is amortised
over a period of 5 years on pro rata basis under Straight Line Method from the date the software
becomes Available for Use. If the software is still in the development phase and has not become
Available for Use, no amortisation is charged to Profit & Loss Account.

8. Non Banking Assets

In the case of Non Banking Assets, diminution in value, if any, is provided for.

9. Employee Benefits

9.1 Short Term Employee Benefits

The undiscounted amount of short-term employee benefits which are expected to be paid in exchange for
the services rendered by employees are recognised during the period when the employee renders the
service.

9.2 Long term Employee Benefits

a) Defined Contribution Plan Provident Fund and New Pension Scheme (Contributory) are the
defined contribution plans of our Bank. In addition to contribution for the period, shortfall, if any,
in the Income and Expenditure account of the Provident Fund is charged to Profit and Loss
Account of our Bank.

b) Defined Benefit Plans Liabilities towards Gratuity, Pension and Leave benefits to employees are
defined benefit obligations and are provided for on the basis of actuarial valuation made at the end
of each financial year. Projected Unit Credit Method is used by the actuary for valuing the
obligations in case of Pension, Gratuity and Long term Compensated Absences and other long
term employee benefits. Discount rate used to arrive at the present value of estimated future cash
flows is arrived at by reference to market yields on balance sheet date on government bonds of
term consistent with estimated term of the obligations as per para 78 of AS 15 Employee Benefits.
Actuarial Gains/Losses are immediately taken to the profit and loss account and are not deferred.

Brief description of the defined benefit plans:

i) Pension - Pension is payable to the employees who have specifically opted for the same.
For becoming eligible for pension, the employee should have served our Bank for a
minimum period of 10 years in the case of retirement on superannuation and 20 years in
other cases. At the time of retirement or death of the pension eligible employee, the
pension trust purchases annuity from insurance company, out of the contributions made
by our Bank.

ii) Gratuity - Gratuity is payable to all employees on termination of employment due to

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 retirement, death or resignation, provided that the employee has served our Bank for a
minimum period of 5 years. The net liability arising out of reopening of pension option to
employees and enhancement in gratuity limits is amortised in 5 years commencing from
2010-11as per approval of RBI (vide the RBI Circular DBOD.No.BP.
BC.80/21.04.018/2010-11 dated February 9, 2011 and RBI letter
DBOD.No.BP.BC.15896/21.04.018/2010-11 dated April 08, 2011).

iii) Long term compensated absences and other long term employee benefits.

a. Privilege Leave.
b. Sick leave on half pay.
c. Carry forward of unavailed casual leave.
d. Leave fare concession.

10. Recognition of revenue and expenditure

Revenue is recognised to the extent it is probable that the economic benefits will flow to our Bank and the
revenue can be reliably measured.

a) Interest/discount on advances/bills is recognised on accrual basis except on non-performing assets

in which case the income is recognised as per prudential norms issued by RBI.

b) Exchange, Brokerage, Commission & Rent on lockers are recognised on cash basis.

c) Income on Investments (other than dividend on equity shares & mutual funds and income on non
performing investments) is recognised on accrual basis. Dividend income is recognised on cash
basis.

d) Recovery in Non Performing Assets is first appropriated towards interest and the balance, if any,
towards principal, except in the case of Suit Filed Accounts, sale to Asset Reconstruction
Companies and accounts under One Time Settlement.

e) Legal expenses incurred on suit filed accounts are expensed in profit and loss account as per RBI
guidelines. Such amount when recovered is treated as income.

11. Taxes on income

Income tax expense is the aggregate amount of current tax and deferred tax charge. Current year taxes are
determined in accordance with the Income Tax Act, 1961. Deferred income taxes reflect the impact of
current year timing differences between taxable income and accounting income for the year and reversal of
timing differences of earlier years.

Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the
Balance Sheet date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right
exists to set off current tax assets against current tax liabilities and the deferred tax assets and deferred tax
liabilities relate to the taxes on income levied by same governing taxation laws. Deferred tax assets are
recognized only to the extent that there is a reasonable certainty that sufficient future taxable income will
be available against which such deferred tax assets can be realized. The impact of changes in the deferred
tax assets and liabilities is recognized in the Profit and Loss Account.

Deferred tax assets are recognized and reassessed at each reporting date, based upon the Management’s
judgement as to whether realisation is considered as reasonably certain. Deferred tax assets are recognized
on carry forward of unabsorbed depreciation and tax losses only if there is virtual certainty that such
deferred tax asset can be realized against future profits.

12. Segment Information

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 Bank has adopted RBI’s revised guidelines on segment reporting issued in April 2007 and accordingly 4
business segments viz. Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking
Operations have been considered as reportable segments. Advances classified as corporate as per Basel II
norms are grouped in Corporate/Wholesale Banking assets while all other advances are grouped as Retail
Banking Assets. Deposits of 10 million and above are classified as corporate/wholesale banking liabilities
(to conform to ALM classification adopted by our Bank) and all other deposits are grouped as retail
banking liabilities. Deposits of borrowers classified as corporate as per Basel II norms are treated as
wholesale deposits regardless of amount. For arriving at segment results, income and expenditure that
cannot be directly identified with a particular segment are allocated on appropriate basis.

13. Impairment of assets

Impairment losses, if any, on Fixed Assets (including revalued assets) are recognized in accordance with
the Accounting Standard 28 ‘Impairment of Assets’ issued by Institute of Chartered Accountants of India
(ICAI) and charged to Profit and Loss Account.

14. Accounting for provisions, contingent liabilities and contingent assets

As per the Accounting Standard 29, ‘Provisions, Contingent Liabilities and Contingent Assets’, issued by
the Institute of Chartered Accountants of India (ICAI), our Bank recognizes provisions only when it has a
present obligation as a result of a past event, it is probable that an outflow of resources embodying
economic benefits will be required to settle the obligation, and when a reliable estimate of the amount of
the obligation can be made.

Contingent assets are not recognized in the financial statements.

15. Earnings per share

Our Bank reports basic and diluted Earnings per equity share in accordance with the Accounting Standard
20 on “Earnings per share”. Our Bank reports basic and diluted earnings per equity share in accordance
with AS 20, “Earnings per share” prescribed by the Companies (Accounting Standards) Rules, 2006. Basic
Earnings per share (EPS) reported is computed by dividing net profit after tax by the weighted average
number of equity shares outstanding for the period. Diluted earnings per equity share have been computed
using the weighted average number of equity shares and dilutive potential equity shares outstanding during
the period except where the results are anti dilutive.

16. Net profit

The net profit disclosed in the Profit & Loss Account is after

(i) provision for taxes

(ii) provision for standard and non performing assets as per the prudential norms.

(iii) provision for depreciation on investments

(iv) other usual and necessary provisions.

Results of Operations

The table below sets forth a summary of our financial results containing significant items of our income and
expenditure for Fiscal 2012, 2013, 2014 and six months ended September 30, 2014, based on our restated financial
statements included in the section titled “Financial Information” on page 190.

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 (in ` million, except percentages)
Particulars Fiscal 2012 Fiscal 2013 Fiscal 2014 Six months ended
September 30, 2014
Income Amount % of Amount % of Amount % of Amount % of
total total total total
Income Income Income Income
Interest earned (A) 10,756.34 92.66 13,208.64 93.32 15,039.78 92.76 7,692.34 94.24
Interest expended (B) 7,686.09 66.21 9,816.48 69.35 11,247.74 69.37 5,854.00 71.72
Net Interest Income (C= 3,070.25 26.45 3,392.16 23.97 3,792.04 23.39 1,838.34 22.52
A-B)
Other income (D) 851.61 7.34 945.66 6.68 1,173.18 7.24 470.40 5.76
Total income (E = A+D) 11,607.95 100.00 14,154.30 100.00 16,212.96 100.00 8,162.74 100.00
Operating expenses (F) 2,984.73 25.71 3,409.52 24.09 3,950.24 24.36 2,042.53 25.02
Total expenditure 10,670.82 91.93 13,226.00 93.44 15,197.98 93.74 7,896.53 96.74
(excluding provisions and
contingencies) (G = B+F)
Provisions and 640.09 5.51 600.84 4.24 546.00 3.37 542.33 6.64
contingencies (other than
provisions for tax) (H)
Provision for tax (I) 36.60 0.32 61.29 0.43 159.52 0.98 (94.65) (1.16)
Net profit/ (loss) after tax 260.44 2.24 266.17 1.88 309.46 1.91 (181.47) (2.22)
(E-G-H-I)

Components of Income and Expenditure

Income

Our income consists of interest earned and other income.

Interest earned includes interest and discounts on advances and bills made to our customers, income on investments,
interest on balances with the RBI and other inter-bank funds and other interest income (which primarily includes
interest income received from refunds of income tax). Our investment portfolio consists primarily of dated central
government and state government securities, other approved securities, bonds issued by public sector undertakings,
RIDF (and other funds), security receipts issued by asset restructuring companies, bank certificate of deposits,
equity shares and other deposits. We meet our SLR requirements through investments in dated central government,
treasury bills and other approved securities.

Our other income consists of commission, exchange and brokerage fees, profit from sale of investments, profit from
sale of land, buildings and other assets (including from sale of non-bank assets), profits from exchange transactions
and miscellaneous income. Our miscellaneous income consists primarily of recovery of bad debts written off, locker
rents, building rentals, lease rental income, processing fees on our banking products and other charges such as
incidental charges (including charges for non-maintenance of minimum balance) and folio and service charges.

Expenditure

Our expenditure consists of interest expended and operating expenses.

Our interest expended consists of the interest paid on deposits, interest paid on borrowings from the RBI and other
inter-bank counterparties/financial institutions and other interest expenses (including interest paid on CBLO
borrowings and tier II bonds issued by us).

Our non-interest expenditure consists principally of operating expenses, which includes payments to and provisions
for employees, rent, taxes and lighting, printing and stationery, depreciation on our Bank’s properties, directors’ and
auditors’ fees, law charges, repairs and maintenance, insurance, postage and telecommunications, advertising and
publicity, and other expenses, which consist primarily of travelling and inspection expenses, business promotion
expenses, expenses on security and watchmen, clearing house expenses, wages paid to temporary labour and facility
management charges.

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Provisions and contingencies

Provisioning for standard (performing) assets, non-performing assets, depreciation on investments, diminution in
restructured standard advances are included in provisions and contingencies.

Six months ended September 30, 2014

Summary of performance

(in ` million)
Particulars For six months ended September
30, 2014
Net Interest Income 1,838.34
Other Income 470.40
Operating Expenses 2,042.53
Provisions and Contingencies (other than provisions for tax) 542.33
Provision for Tax (94.65)
Net loss after tax (181.47)

Net Interest Income

Our net interest income for the six months ended September 30, 2014 was ` 1,838.34 million.

(in ` million)
Particulars For six months ended September
30, 2014
Interest/ discount on advances/ bills 5,762.99
Income on investments 1,862.06
Interest on balance with RBI and other inter-bank funds 61.81
Interest on others 5.48
Interest earned 7,692.34
Interest on deposits 5,661.42
Interest on RBI/ inter-bank borrowings 111.83
Others 80.75
Interest expended 5,854.00
Net interest income 1,838.34

Interest earned

Our interest earned for the six months ended September 30, 2014 was ` 7,692.34 million. Our interest earned
comprised primarily of the following:

 Our income on interest and discount of advance/ bills of ` 5,762.99 million. The average yield on our
advances portfolio was 12.72% (annualized) for the six months ended September 30, 2014; and

 Our interest earned on investments was ` 1,862.06 million. These investments primarily included government
securities, bank certificate of deposits, securities issued by asset restructuring companies, the RIDF, treasury
bills and PSU bonds.

Interest expended

Our interest expended for the six months ended September 30, 2014 was 5,854.00 million. Our interest expended
comprised primarily of the following:

 Interest paid on deposits for the six months ended September 30, 2014 was ` 5,661.42 million. The average
cost of our deposits was 8.36% (annualized) as at September 30, 2014; and

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 Interest paid on RBI borrowings was ` 111.83 million.

Other income

Our other income for the six months ended September 30, 2014 was ` 470.40 million; consisting of commission,
exchange and brokerage income of ` 94.70 million; net profit on the sale of investments of ` 82.13 million; net
profit on exchange transactions of ` 71.96 million; and miscellaneous income of ` 223.23 million, which primarily
included income from processing fees of ` 101.46 million, income from incidental charges (such as penalties for
non-maintenance of minimum balances in bank accounts) of ` 75.10 million and income from folio and service
charges of ` 29.19 million; and was partly offset by losses on the sale of land, buildings and other assets of ` 1.62
million.

Operating expenses

Our operating expenses for the six months ended September 30, 2014 were ` 2,042.53 million. This was primarily
impacted by the payment and provisions made to the employees pursuant to revision in dearness allowances. Other
key contributing factors to the operating expenses were payment for rent, tax and lighting expenses of ` 202.81
million, premium of ` 68.59 paid on insurance policies and other expenditure ` 187.08 million which primarily
included travelling and inspection expenses of ` 57.38 million, expenses towards security arrangements of our
branches and ATMs of ` 26.48 million, wages paid to temporary labour of ` 15.12 million and facility management
charges of ` 12.50 million.

Provisions and contingencies (other than provision for tax)

Our provisions and contingencies (other than provision for tax) for the six months ended September 30, 2014 were `
542.33 million. Provisions and contingencies for the six months ended September 30, 2014 include provision for
NPAs including write off of ` 571.36 million which have been partially offset primarily by depreciation on
investments/(written back) of ` (22.71) million and provisions for standards assets of ` (1.95) million.

Provisions for tax

Our provisions for tax for the six months ended September 30, 2014 were ` (94.65) million.

Losses after tax

Our net losses after tax for the six months ended September 30, 2014 were ` 181.47 million. This was primarily on
account of provisioning for NPAs including write-offs to the tune of ` 571.36 million and due to adjustments of `
172.63 million carried out by our Auditors to give effect to the qualification made in the audit report on our financial
statements for the six months ended September 30, 2014 on account of non-classification of two advance accounts
as NPAs based on the RBI’s AFI Report for Fiscal 2014 requiring provisions and interest reversal.

Results for Fiscal 2014 compared with Fiscal 2013

Summary of Performance
(in ` million, except percentages)
Particulars Fiscal 2013 Fiscal 2014 % Change

Net interest income 3,392.16 3,792.04 11.79

Other income 945.66 1,173.18 24.06
Operating expenses 3,409.52 3,950.24 15.86
Provisions and contingencies (other than provisions for tax) 600.84 546.00 (9.12)
Provision for tax 61.29 159.52 160.27
Net profit/(loss) after tax 266.17 309.46 16.26

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Net Interest Income

Our net interest income increased by 11.79% from ` 3,392.16 million in Fiscal 2013 to ` 3,792.04 million in Fiscal
2014. The following table sets forth the main components of our Bank’s net interest income for the periods
indicated.

(in ` million, except percentages)

Particulars Fiscal 2013 Fiscal 2014 % Change
Interest/ discount on advances/ bills 10,743.45 11,386.97 5.99
Income on investments 2,262.59 3,304.09 46.03
Interest on balance with RBI and other inter-bank funds 201.21 319.84 58.96
Interest on others 1.39 28.88 1,977.70
Interest earned 13,208.64 15,039.78 13.86
Interest on deposits 9,502.27 10,942.40 15.16
Interest on RBI/ inter-bank borrowings 73.43 115.32 57.04
Others 240.78 190.02 (21.08)
Interest expended 9,816.48 11,247.74 14.58
Net interest income 3,392.16 3,792.04 11.79

Interest earned

Our interest earned increased by 13.86% from ` 13,208.64 million in Fiscal 2013 to ` 15,039.78million in Fiscal
2014. The increase in interest earned was primarily due to the following:

 Our interest earned from advances and discounts on bills increased by 5.99% from ` 10,743.45 million in
Fiscal 2013 to ` 11,386.97 million in Fiscal 2014, primarily due to an increase in average advances from
` 82,879.90 million in Fiscal 2013 to ` 86,915.40 million in Fiscal 2014. The increase in average advances
was primarily due to the increase in our average gold loans from ` 28,799.47 million in Fiscal 2013 to
` 30,183.99 million in Fiscal 2014.

 Our income on investments increased by 46.03% from ` 2,262.59 million in Fiscal 2013 to ` 3,304.09 million
in Fiscal 2014 primarily due to increase in our investments in bank certificate of deposits and other short term
investments carrying higher yield as compared to other components of our investment portfolio. As a result of
the foregoing, our yield on investments increased from 6.88% in Fiscal 2013 to 7.26% in Fiscal 2014.

 Our interest on balances with RBI and other inter-bank funds increased by 58.96% from ` 201.21 million in
Fiscal 2013 to ` 319.84 million in Fiscal 2014 primarily due to increase in average inter-bank deposits from
` 2,072.92 million in Fiscal 2013 to ` 3,128.33 million in Fiscal 2014, and increase in the interest rate for
inter-bank deposits.

 Our other interest earned increased by 1,977.70% from ` 1.39 million in Fiscal 2013 to ` 28.88 million in
Fiscal 2014, primarily due to receipt of ` 27.87 million of interest on our income tax refunds and ` 0.91
million of interest on reverse repo lending.

Interest Expended

Our interest expended increased by 14.58% from ` 9,816.48 million in Fiscal 2013 to ` 11,247.74 million in Fiscal
2014. The increase in interest expended was primarily due to the following:

 Our interest expense on deposits increased by 15.16% from ` 9,502.27 million in Fiscal 2013 to ` 10,942.40
million in Fiscal 2014 primarily due to increase in average term deposits from ` 92,013.34 million in Fiscal
2013 to ` 107,059.80 million in Fiscal 2014.

 Interest expense on RBI and inter-bank borrowings increased by 57.04% from ` 73.43 million in Fiscal 2013
to ` 115.32 million in Fiscal 2014 primarily due to increase in average borrowings from RBI from ` 1,041.67
million in Fiscal 2013 to ` 1,693.33 million in Fiscal 2014.

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 Such increase was partially offset by a decrease in the interest expenditure on our other borrowings by
21.08% from ` 240.78 million in Fiscal 2013 to ` 190.02 million in Fiscal 2014 primarily due to decrease in
average borrowings from NABARD and NHB from ` 1,202.87 million in Fiscal 2013 to ` 617.66 million in
Fiscal 2014, and decrease in the average amounts outstanding on tier II bonds (on account of redemption of
tier II bonds) from ` 1,188.33 million in Fiscal 2013 to ` 1,150.77 million in Fiscal 2014.

Other Income

Our other income increased by 24.06% from ` 945.66 million in Fiscal 2013 to ` 1,173.18 million in Fiscal
2014.The increase in other income was primarily due to the following:

 Our profit on sales of investments increased by 92.66% from ` 228.88 million in Fiscal 2013 to ` 440.97
million in Fiscal 2014 primarily due to profit from sale of government securities in light of increase in the
price of government securities.

 Our miscellaneous income increased by 4.82% from ` 418.88 million in Fiscal 2013 to ` 439.05 million in
Fiscal 2014 primarily due to an increase in processing fee earned for loans and other credit facilities from `
129.12 million in Fiscal 2013 to ` 162.77 million in Fiscal 2014 on account of increase in the volume of loans
and other credit facilities disbursed by us.

 Such increase was partially offset by a decrease on net profit on exchange transactions by 4.12% from `
130.73 million in Fiscal 2013 to ` 125.35 million in Fiscal 2014 primarily due to volatility in the rupee
exchange rate.

Operating expenses

Our operating expenses increased by 15.86%from ` 3,409.52 million in Fiscal 2013 to ` 3,950.24 million in Fiscal
2014. The increase in our operating expenses was primarily due to the following:

 Our expenses related to payments and provisions for employees increased by 15.87% from ` 2,430.90 million
in Fiscal 2013 to ` 2,816.73 million in Fiscal 2014, primarily due to increase in dearness allowance for
employees, provision for salary arrears towards expected wage revisions and additional provisions towards
expected escalation in retirement benefits of employees.

 Rent, taxes and lighting expenses increased by 18.69% from ` 323.41 million in Fiscal 2013 to ` 383.84
million in Fiscal 2014 primarily due to renewal of lease agreements for existing branches and the setting up of
40 new branches in Fiscal 2014.

 Our insurance related expenses increased by 28.53% from ` 100.06 million in Fiscal 2013 to ` 128.61 million
in Fiscal 2014 primarily due to increase in the amount of deposit insurance premium paid by our Bank to the
DICGC from ` 95.33 million in Fiscal 2013 to ` 123.20 million in Fiscal 2014, necessitated by increase in
our deposits required to be covered by deposit insurance.

 Our other operating expenditure increased by 21.76% from ` 282.55 million in Fiscal 2013 to ` 344.03
million in Fiscal 2014 primarily due to increase in travelling and inspection expenses from ` 82.35 million in
Fiscal 2013 to ` 110.02 million in Fiscal 2014 and increase in expenses towards security arrangements of our
branches and ATMs from ` 39.42 million in Fiscal 2013 to ` 51.04 million in Fiscal 2014.

 Such increase was partially offset by the decrease in advertising and publicity expenses by 40.53% from `
18.11 million in Fiscal 2013 to ` 10.77 million in Fiscal 2014, primarily due to reduction in advertisements.

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Provisions and contingencies (other than provision for tax)

Provisions and contingencies (other than provision for tax) decreased by 9.12% from ` 600.84 million in Fiscal
2013 to ` 546.00 million in Fiscal 2014 primarily due to decrease in provisioning in standard assets and reversal of
provision for diminution in advances to customers which have been restructured. Our provision coverage ratio was
maintained at 49.28% as on March 31, 2014. Our gross NPA ratio increased from 2.35% as at March 31, 2013 to
3.77% as at March 31, 2014, and our net NPA ratio increased from 1.12% as at March 31, 2013 to 2.22% as at
March 31, 2014.

Provision for tax (including deferred tax)

Provision for tax increased by 160.27% from ` 61.29 million in Fiscal 2013 to ` 159.52 million in Fiscal 2014
primarily due to increase in profit before tax.

Net profit after tax

As a result of the factors mentioned above, our net profits after tax increased by 16.26% from ` 266.17 million in
Fiscal 2013 to ` 309.46 million in Fiscal 2014.

Results for Fiscal 2013 compared with Fiscal 2012

Summary of Performance
(in ` million, except percentages)
Particulars Fiscal 2012 Fiscal 2013 % Change
Net Interest income 3,070.25 3,392.16 10.48
Other income 851.61 945.66 11.04
Operating expenses 2,984.73 3,409.52 14.23
Provisions and Contingencies (other than provisions for tax) 640.09 600.84 (6.13)
Provision for Tax 36.60 61.29 67.46
Net profit/(loss) after tax 260.44 266.17 2.20

Net Interest Income

Our net interest income increased by increased by 10.48% from ` 3,070.25 million in Fiscal 2012 to ` 3,392.16
million in Fiscal 2013. The following table sets forth the main components of our Bank’s net interest income for the
periods indicated.
(in ` million, except percentages)
Particulars Fiscal 2012 Fiscal 2013 % Change
Interest/ discount on advances/ bills 8,615.04 10,743.45 24.71
Income on investments 2,008.63 2,262.59 12.64
Interest on balance with RBI and other inter-bank funds 74.27 201.21 170.92
Interest on others 58.40 1.39 (97.62)
Interest earned 10,756.34 13,208.64 22.80
Interest on deposits 7,380.10 9,502.27 28.76
Interest on RBI/ inter-bank borrowings 65.93 73.43 11.38
Others 240.06 240.78 0.30
Interest Expended 7,686.09 9,816.48 27.72
Net interest income 3,070.25 3,392.16 10.48

Interest earned

Our interest earned increased by 22.80% from ` 10,756.34 million in Fiscal 2012 to ` 13,208.64 million in Fiscal
2013. The increase in interest earned was primarily due to the following:

 Our interest earned from advances and discounts on bills increased by 24.71% from ` 8,615.04 million in
Fiscal 2012 to ` 10,743.45 million in Fiscal 2013 primarily due to increase in average advances from `

209
 67,248.17 million in Fiscal 2012 to ` 82,879.90 million in Fiscal 2013 and increase in yield on advances. The
increase in average advances was primarily due to the increase in our average gold loan advances from `
17,738.77 million in Fiscal 2012 to ` 28,799.47 million in Fiscal 2013. Furthermore, our yield on advances
increased from 12.81% in Fiscal 2012 to 12.96% in Fiscal 2013.

 Our income on investments increased by 12.64% from ` 2,008.63 million in Fiscal 2012 to ` 2,262.59 million
in Fiscal 2013 primarily due to increase in average investments by ` 2,612.55 million. Such increase was
primarily on account of increase in average investments in government securities from ` 25,343.62 million in
Fiscal 2012 to ` 28,877.27 million in Fiscal 2013 and increase in our yield on investments from 6.64% in
Fiscal 2012 to 6.88% in Fiscal 2013.

 Our interest on balances with the RBI and other inter-bank funds increased by 170.92% from ` 74.27 million
in Fiscal 2012 to ` 201.21 million in Fiscal 2013. This increase was primarily due to increase in inter-bank
term deposits from ` 610.42 million in Fiscal 2012 to ` 2,072.92 million.

 Such increase was partially offset by decrease in other interest earned by 97.62% from ` 58.40 million in
Fiscal 2012 to ` 1.39 million in Fiscal 2013 primarily due to decrease in interest on income tax refunds.

Interest Expended

Our interest expended increased by 27.72% from ` 7,686.09 million in Fiscal 2012 to ` 9,816.48 million in Fiscal
2013. The increase in interest expended was primarily due to the following:

 Our interest on deposits increased by 28.76% from ` 7,380.10 million in Fiscal 2012 to ` 9,502.27 million in
Fiscal 2013 primarily due to increase in average term deposits and increase in the cost of deposits. Average
term deposits by customers and banks increased from ` 74,886.73 million in Fiscal 2012 to ` 92013.34
million in Fiscal 2013. Further the cost of term deposits increased from 8.97% in Fiscal 2012 to 9.55% in
Fiscal 2013 primarily due to increase in interest rates on domestic and NRE term deposits (following
deregulation of NRE interest rates by the RBI in December 2011, the full impact of which was felt in Fiscal
2013).

 Interest expense on RBI and inter-bank borrowings increased by 11.38% from ` 65.93million in Fiscal 2012
to ` 73.43 million in Fiscal 2013 primarily due to increase in average RBI borrowings from ` 577.51 million
in Fiscal 2012 to ` 1,041.67 million in Fiscal 2013.

Other Income

Our other income increased by 11.04% from ` 851.61 million in Fiscal 2012 to ` 945.66 million in Fiscal 2013. The
increase in other income was primarily due to the following:

 Our profit on sale of investments increased by 333.65% from ` 52.78 million in Fiscal 2012 to ` 228.88
million in Fiscal 2013 primarily due to profit from sale of government securities in light of increase in the
price of government securities.

 Our net profit on exchange transactions increased by 14.87% from ` 113.81 million in Fiscal 2012 to `
130.73 million in Fiscal 2013 primarily due to the increase in foreign exchange transactions by our customers
and increase in remittance business.

 Such increase was partially offset by the decrease in our miscellaneous income by 16.18% from ` 499.72
million in Fiscal 2012 to ` 418.88 million in Fiscal 2013 primarily due to a decrease in the recovery of bad
debts written off by ` 113.35 million in Fiscal 2013.

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Operating expenses

Our operating expenses increased by 14.23% from ` 2,984.73 million in Fiscal 2012 to ` 3,409.52 million in Fiscal
2013. The increase in our operating expenses was primarily due to the following:

 Our expenses related to payments and provisions for employees increased by 14.62% from ` 2,120.87 million
in Fiscal 2012 to ` 2,430.90 million in Fiscal 2013. This was primarily due to increase in dearness allowance
for employees and provision of ` 60.90 million towards salary arrears towards expected wage revisions.

 Rent, taxes and lighting expenses increased by 26.80% from ` 255.06 million in Fiscal 2012 to ` 323.41
million in Fiscal 2013 primarily due to renewal of lease agreements for existing branches and the setting up of
18 new branches.

 Our insurance related expenses increased by 7.30% from ` 93.25 million in Fiscal 2012 to ` 100.06 million in
Fiscal 2013 primarily due to increase in the amount of deposit insurance premium paid by our Bank to the
DICGC from ` 88.47 million in Fiscal 2012 to ` 95.33 million in Fiscal 2013, necessitated by increase in our
deposits required to be covered by deposit insurance.

 Our other operating expenditure increased by 14.97% from ` 245.75 million in Fiscal 2012 to ` 282.55
million in Fiscal 2013 primarily due to increase in expenses towards expenses towards security arrangements
of our branches and ATMs from ` 29.71 million in Fiscal 2012 to ` 39.42 million in Fiscal 2013.

Provisions and contingencies (other than provision for tax):

Provisions and contingencies (other than provision for tax) decreased by 6.13% from ` 640.09 million in Fiscal
2012 to ` 600.84 million in Fiscal 2013 primarily due to decrease in NPA provisioning from ` 459.80 million in
Fiscal 2012 to ` 391.82 million in Fiscal 2013. Our provision coverage ratio was maintained at 63.28% as on March
31, 2013. Our gross NPA ratio remained at 2.35% as at March 31, 2012 and as at March 31, 2013 and our net NPA
ratio increased from 1.10% as at March 31, 2012 to 1.12% as at March 31, 2013.

Provision for tax (including deferred tax):

Provision for tax increased by 67.46% from ` 36.60 million in Fiscal 2012 to ` 61.29 million in Fiscal 2013
primarily due to increase in profit before tax.

Net profit after tax

As a result of the factors mentioned above, our net profit after tax increased by 2.20% from ` 260.44 million in
Fiscal 2012 to ` 266.17 million in Fiscal 2013.

Financial Condition

Assets

The following table sets forth the principal components of the assets as of March 31, 2012, 2013, 2014 and
September 30, 2014.

(in ` million)
Particulars As at March 31, 2012 As at March 31, 2013 As at March 31, 2014 As at September 30,
2014
Amount % of Amount % of Amount % of Amount % of
total total total total
assets assets assets assets
Cash in hand 661.02 0.55 846.80 0.63 720.21 0.47 904.26 0.58
Balance with the RBI 6,203.74 5.18 5,445.78 4.05 5,518.82 3.64 5,394.86 3.47
Balances with banks in 2,436.23 2.03 3,972.86 2.95 3,637.86 2.40 327.81 0.21

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 Particulars As at March 31, 2012 As at March 31, 2013 As at March 31, 2014 As at September 30,
2014
Amount % of Amount % of Amount % of Amount % of
total total total total
assets assets assets assets
India
Balances with banks 409.12 0.34 384.75 0.29 866.13 0.57 998.84 0.64
outside India
Net Investments in 31,451.46 26.26 33,010.52 24.55 51,316.53 33.84 51,329.91 33.01
India
Advances 76,635.43 63.99 88,515.18 65.82 87,073.62 57.42 94,303.03 60.65
Net fixed assets (less: 371.12 0.31 427.46 0.32 483.34 0.32 474.50 0.31
revaluation reserve)
Net other assets (less: 1,585.95 1.32 1,882.99 1.40 2,037.31 1.34 1,761.07 1.13
deferred tax and
intangible assets)
Total 119,754.07 100.00 134,486.34 100.00 151,653.82 100.00 155,494.28 100.00

Total assets increased by 12.30% from ` 119,754.07 million as of March 31, 2012 to ` 134,486.34 million as of
March 31, 2013, by 12.77% from ` 134,486.34 million as of March 31, 2013 to ` 151,653.82 million as of March
31, 2014 and further to ` 155,494.28 million as of September 30, 2014. The increase was primarily due to increase
in investments and advances.

Our cash in hand increased by 28.11% from ` 661.02 million as of March 31, 2012 to ` 846.80 million as of March
31, 2013 and decreased by 14.95% from ` 846.80 million as of March 31, 2013 to ` 720.21 million as of March 31,
2014. Our cash in hand as of September 30, 2014was ` 904.26 million.

Our balances with RBI decreased by 12.22% from ` 6,203.74 million as of March 31, 2012 to ` 5,445.78 million as
of March 31, 2013. However it increased by 1.34% from ` 5,445.78million as of March 31, 2013 to ` 5,518.82
million as of March 31, 2014. Such decrease and increase was on account of treasury management activities by our
Bank in the ordinary course of business, taking into account prevailing CRR requirements.

Our balances with banks in India increased by 63.07% from ` 2,436.23 million as of March 31, 2012 to ` 3,972.86
million as of March 31, 2013. However they decreased by 8.43% from ` 3,972.86million as of March 31, 2013 to `
3,637.86 million as of March 31, 2014. Such increase and decrease was on account of treasury management
activities by our Bank in the ordinary course of business. Our balances with banks in India, as of September 30,
2014 were ` 327.81million.

Our balances with banks outside India decreased by 5.96% from ` 409.12 million as of March 31, 2012 to ` 384.75
million as of March 31, 2013. However, they increased by 125.12% from ` 384.75 million as of March 31, 2013 to
` 866.13 million as of March 31, 2014 primarily on account of FCNR (B) deposits and decrease in deployments of
foreign currency loans. Our balance with banks outside India as of September 30, 2014 was ` 998.84 million.

Our investments increased by 4.96% from ` 31,451.46 million as of March 31, 2012 to ` 33,010.52 million as of
March 31, 2013, by 55.46% from ` 33,010.52 million as at March 31, 2013 to ` 51,316.53 million as of March 31,
2014 and further to ` 51,329.91 million as of September 30, 2014. The increase in investments in Fiscal 2014 was
primarily on account of reduction in advances from ` 88,515.18 million in Fiscal 2013 to ` 87,073.62 million in
Fiscal 2014 combined with increase in deposits from ` 123,416.26 million in Fiscal 2013 to ` 136,738.61 million in
Fiscal 2014, leading to higher investments in government securities and high yielding short term instruments such as
bank certificate of deposit.

Our advances increased by 15.50% from ` 76,635.43 million as of March 31, 2012 to ` 88,515.18 million as of
March 31, 2013 primarily due to increase in our gold loan portfolio from ` 23,296.13 million in Fiscal 2012 to `
34,387.48 million in Fiscal 2013. However, our advances decreased by 1.63% from ` 88,515.18 million as at March
31, 2013 to ` 87,073.62 million as of March 31, 2014 due to a decrease in our gold loan portfolio from ` 34,387.48
million in Fiscal 2013 to ` 28,365.32 million in Fiscal 2014. Our advances were ` 94,303.03 million as of
September 30, 2014.

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Our net fixed assets increased by 15.18% from ` 371.12 million as of March 31, 2012 to ` 427.46 million as of
March 31, 2013, by 13.07% from ` 427.46 million as of March 31, 2013 to ` 483.34 million as of March 31, 2014.
The increase was primarily due to increase in furniture and fixtures and purchase of fixed assets for our offices,
branches and ATMs. As of September 30, 2014, out net fixed assets were `474.50 million.

Our net other assets increased by 18.73% from ` 1,585.95 million as of March 31, 2012 to ` 1,882.99 million as of
March 31, 2013 primarily on account of application monies for investment in PSU bonds pending allotment. Our net
other asset increased by 8.20% from ` 1,882.99 million as of March 31, 2013 to ` 2,037.31 million as of March 31,
2014 primarily on account of increase in other assets from ` 713.68 million in Fiscal 2013 to ` 1,176.79 million in
Fiscal 2014. As of September 30, 2014, our net other assets were ` 1,761.07 million.

Liabilities and shareholder’s equity

The following table sets forth the principal components of capital and liability as of March 31, 2012, 2013 and 2014:

(in ` million)
Particulars As at March 31, As at March 31, As at March 31, As of September
2012 2013 2014 30, 2014
Share Capital (A) 314.16 418.99 418.99 418.99
Reserves and surplus (B) 4,635.58 5,380.75 5,779.61 5,140.36
Shareholders’ funds (A+B) 4,949.74 5,799.74 6,198.60 5,559.35
Deposits 106,048.70 123,416.26 136,738.61 141,655.02
Borrowings 5,754.65 1,994.06 5,555.43 5,327.95
Other liabilities and provisions 3,000.98 3,276.28 3,161.18 2,951.96
Total liabilities and shareholder funds 119,754.07 134,486.34 151,653.82 155,494.28

As of September 30, 2014, our total shareholders’ funds were ` 5,559.35 million, consisting of share capital of `
418.99 million and reserves and surplus (consisting of statutory reserve, capital reserve, share premium and revenue
and other reserves) of ` 5,140.36 million. Further, our total deposits (consisting of demand deposits from banks and
others, savings deposits, term deposits from banks and term deposits from others) constituted ` 141,665.02 million,
our total borrowings (consisting of borrowings in India and subordinated tier II bonds) constituted ` 5,327.95
million and we had other liabilities and provisions amounting to ` 2,951.96 million.

Total shareholders’ funds increased by 6.88% from ` 5,799.74 million as of March 31, 2013 to ` 6,198.60 million
as of March 31, 2014 primarily due to appropriation of profits to capital reserves and statutory reserves. Total
shareholders’ funds increased by 17.17% from ` 4,949.74 million as of March 31, 2012 to ` 5,799.74 million as of
March 31, 2013 primarily due to a rights issue of Equity Shares amounting to ` 784.63 million and appropriation of
profits to various reserves.

Our deposits (comprising of demand deposits from banks and others, savings deposits and term deposits from banks
and other institutions) increased by 10.79% from ` 123,416.26 million as of March 31, 2013 to ` 136,738.61 million
as of March 31, 2014, and by 16.38% to ` 123,416.26 million as of March 31, 2013 from ` 106,048.70 million as of
March 31, 2012, primarily due to increase in term deposits from ` 101,782.31 million in Fiscal 2013 to ` 113,128.78
million in Fiscal 2014 and by an increase in term deposits from ` 85,565.15 million in Fiscal 2012 to ` 101,782.31
million in Fiscal 2013.

Our borrowings (comprising of borrowings within India and subordinated tier II bonds) increased by 178.60% from
` 1,994.06 million as of March 31, 2013 to ` 5,555.43 million as of March 31, 2014, primarily due to increase in
borrowings from the RBI. While our Bank did not have any borrowings from the RBI in Fiscal 2013, it had
borrowings from the RBI of ` 4,190.00 million in Fiscal 2014. Borrowings decreased by 65.35% from ` 5,754.65
million as of March 31, 2012 to ` 1,994.06 million as of March 31, 2013, primarily due to decrease in borrowings
from the RBI from ` 577.51 million in Fiscal 2012 to ` 1,041.67 million in Fiscal 2013 on account of higher repo
borrowings from the RBI. Our borrowings are actively managed by the treasury department of our Bank keeping in
mind the business needs of our Bank, the comparative cost dynamics and tenor of the funding. Further, the level of
money market borrowings and inter-bank borrowings do fluctuate dynamically based on needs of the business.

213
Our other liabilities and provisions decreased by 3.51% from ` 3,276.28 million as of March 31, 2013 to ` 3,161.18
million as of March 31, 2014 and increased by 9.17% from ` 3,000.98 million as of March 31, 2012 to ` 3,276.28
million as of March 31, 2013.

Liquidity, capital resources and capital adequacy

We regularly monitor our funding levels to ensure we are able to satisfy the requirements of our loan disbursements
and those that would arise upon maturity of our liabilities. Further, since we are regulated by RBI, we need to
comply with various liquidity guidelines and ratios as prescribed by RBI from time to time. We maintain diverse
sources of funding and liquid assets to facilitate flexibility in meeting our liquidity requirements. Liquidity is
provided principally by deposits and borrowings from banks and financial institutions, deposits from customers and
retained earnings. Surplus funds, if any, are invested in accordance with our Investment Policy.

In addition, we monitor and manage our asset-liability gap with respect to our maturing assets and liabilities. As of
September 30, 2014, our liabilities in the nature of deposits, borrowing and foreign currency liabilities maturing
within 28 days exceeded our assets in the nature of advances, investments and foreign currency assets maturing
within the same period by ` 9,816.49 million. Our assets maturing in 29 days to 1 year, one to three years and three
years to five years exceeded our liabilities maturing within the same period by ` 16,856.15 million, ` 5,883.69
million and ` 3,367.60 million respectively. Our liabilities maturing over five years exceeded our assets maturing
within the same period by ` 35,548.83 million.

We are also subject to the capital adequacy requirements of the RBI. As per capital adequacy guidelines under Basel
III framework, by March 31, 2019, we are required to maintain a minimum capital adequacy ratio of 11.5%
(including 2.5% of Capital Conservation Buffer (CB)), with minimum Common Equity Tier III (CET I) CAR of
5.5% (8% including CB). These guidelines on Basel III framework are to be implemented in a phased manner. The
minimum CAR required to be maintained by our Bank for Fiscal 2014 is 9% with minimum CET I of 5%.

Our capital adequacy ratios are as follows.

Particulars As at March 31 As of
2012 2013 2014 September 30,
2014
(Basel II)
Risk weighted assets (` million) 54,874.87 59,940.58 66,886.48 69,094.25
Total Capital (` million) 6,113.04 7,306.96 7,525.81 6,822.98
Tier-I Capital (` million) 4,877.56 5,706.87 6,198.61 5,500.71
Tier-II Capital (` million) 1,235.47 1,600.09 1,327.21 1,322.27
Total CRAR 11.14% 12.19% 11.25% 9.87%
Tier I CRAR 8.89% 9.52% 9.27% 7.96%
Tier II CRAR 2.25% 2.67% 1.98% 1.91%
(Basel III)
Risk weighted assets (` million) N.A. N.A. 66,955.53 69,168.99
Total Capital (` million) N.A. N.A. 7,364.81 6,722.48
Tier-I Capital (` million) N.A. N.A. 6,077.61 5,440.21
Tier-II Capital (` million) N.A. N.A. 1,287.21 1,282.27
Total CRAR N.A. N.A. 11.00% 9.72%
Tier I CRAR N.A. N.A. 9.08% 7.87%
Tier II CRAR N.A. N.A. 1.92% 1.85%

Basel III capital regulations has been implemented by the RBI from April 1, 2013 in India in phases, with the full
implementation of Basel III capital regulations by March 31, 2019. See the section titled “Regulations and Policies”
on page 149 for details on the required minimum capital ratios for scheduled commercial banks as stipulated by the
Basel III Capital Regulations. The data for Fiscal 2014 in the above table is in accordance with Base III framework,
while the data for Fiscal 2013 and Fiscal 2012 is in accordance with Base II framework.

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Cash flows

Cash Flow Data

The following table sets forth certain information about our cash flows, as restated for the periods indicated.

(in ` million)
Particulars Six For the year ended March 31
months ended 2014 2013 2012
September 30,
2014
Net cash from / (used in) operating activities (2,478.01) 534.53 604.09 2,469.91
Net cash from / (used in) investing activities (55.16) (157.58) (125.56) (74.70)
Net cash from / (used in) financing activities (584.08) (284.12) 461.55 313.99
Cash and cash equivalents at end of period 7,625.76 10,743.01 10.650.18 9,710.10

For the six months ended September 30, 2014

As of September 30, 2014, we had cash and cash equivalents of ` 7,625.76 million.

Our restated losses before taxation was ` 276.12 million for six months ended September 30, 2014. This amount was
adjusted for non-cash items and non-operating expenses including ` 45.26 million for depreciation on fixed assets, `
7.87 million for amortisation of intangible assets, ` 542.33 million for provisions and contingencies, ` 35.12 million
for interest on tier II bonds and `2.72 million for other adjustments. Our operating profit before working capital
changes was ` 357.18 million. We also generated cash from working capital changes including ` 4,916.41 million
from deposits, ` 272.52 million from borrowings, ` 9.32 million from investments and ` 208.36 million from other
assets, which was offset by advances of ` 8,217.02 million and working capital changes for other liabilities of `
199.14 million. Further we have generated ` 174.36 million from refund of taxes. As a result of the foregoing, net
cash used in operating activities was ` 2,478.01million for six months ended September 30, 2014.

For the six months ended September 30, 2014, net cash used in investing activities was ` 55.16 million. This was
primarily due to ` 56.21 million used for purchase of fixed assets and intangible assets, partially offset by the
generation of ` 1.05 million from the sale of fixed assets.

Net cash used in financing activities was ` 584.08 million for the six months ended September 30, 2014. This
was primarily due to ` 500 million being used for redemption of tier II bonds by our Bank, ` 35.12 million used to
pay interest on tier II bonds and ` 48.96 million used for payment of dividends (including taxes on dividends).

Fiscal year ended March 31, 2014

As at March 31, 2014, we had cash and cash equivalents of ` 10,743.01 million.

Our restated profit before taxation was ` 468.98 million for Fiscal 2014. This amount was adjusted for non-cash
items and non-operating expenses including ` 59.13 million for depreciation on fixed assets, ` 14.34 million for
amortisation of intangible assets, ` 546.00 million for provisions and contingencies, ` 110.67 for interest on tier II
bonds and partially offset by the use of ` 32.03 million for other adjustments. Our operating profit before working
capital changes was ` 1,167.09 million. We also generated cash from working capital changes including `
13,322.31 million from deposits, ` 3,661.37 million from borrowings and ` 911.48 million from advances, which
was offset by working capital changes for other liabilities of ` 29.54 million and investments of ` 18,351.64 million
and other assets of ` 50.62 million. Further we have paid taxes worth ` 95.97million. As a result of the foregoing,
net cash generated from operating activities was ` 534.53million for Fiscal 2014.

For Fiscal 2014, net cash used in investing activities was ` 157.58 million. This was primarily due to ` 159.96
million used for purchase of fixed assets and intangible assets, partially offset by the generation of ` 2.38
million from the sale of fixed assets.

215
Net cash used in financing activities was ` 284.12 million for Fiscal 2014. This was primarily due to ` 100.01
million being used for redemption of tier II bonds by our Bank, ` 110.67 million used to pay interest on tier II bonds
and ` 73.44 million used for payment of dividends (including taxes on dividends).

Fiscal year ended March 31, 2013

As at March 31, 2013, we had cash and cash equivalents of ` 10,650.18 million.

Our restated profit before taxation was ` 327.46 million for Fiscal 2013. This amount was adjusted for non-cash
items and non-operating expenses including ` 53.12million for depreciation on fixed assets, ` 21.28 million for
amortisation of intangible assets, ` 600.84 million for provisions and contingencies, ` 111.03 million for interest on
tier II Bonds and ` 71.29 million for other adjustments. Our operating profit before working capital changes was `
1,185.02 million. We also generated cash from working capital changes including ` 17,367.55 million from
deposits, ` 63.06 million from other liabilities, which was offset by working capital changes of borrowings of `
3,600.59 million, investments of ` 1,571.74 million, advances of ` 12,345.00 million and other assets of ` 503.09
million. Further we have generated ` 8.88 million from refund of taxes. As a result of the foregoing, net cash
generated from operating activities was ` 604.09 million for Fiscal 2013.

For Fiscal 2013, net cash used in investing activities was ` 125.56million. This was primarily due to ` 127.85
million used for purchase of fixed assets and intangible assets, partially offset by the generation of ` 2.29
million from the sale of fixed assets.

Net cash generated in financing activities was ` 461.55 million for Fiscal 2013. This was primarily due to
issuance of Equity Share capital of ` 104.83 million, share premium gained from issuance of Equity Shares of `
682.24 million, which was partially offset by ` 160.00 million used for redemption of tier II bonds by our Bank, `
111.03 million used to pay interest on tier II bonds and ` 54.49 million used for payment of dividends (including
taxes on dividends).

Fiscal year ended March 31, 2012

As at March 31, 2012, we had cash and cash equivalents of ` 9,710.10 million.

Our restated profit before taxation was ` 297.04 million for Fiscal 2012. This amount was adjusted for non-cash
items and non-operating expenses including ` 63.20 million for depreciation on fixed assets, ` 22.18 million for
amortisation of intangible assets, ` 640.09 million for provisions and contingencies, ` 74.60 million for interest on
tier II Bonds and ` 23.73 million for other adjustments. Our operating profit before working capital changes was `
1,120.84 million. We also generated cash from working capital changes including borrowings of ` 2,098.46
million, ` 18,792.01 million from deposits and ` 490.07 million from other liabilities, which was offset by working
capital changes of investments of ` 4,543.77 million, advances of ` 14,958.81million and other assets of ` 381.95
million. Further we also paid taxes of ` 146.94 million. As a result of the foregoing, net cash generated from
operating activities was ` 2,469.91 million for Fiscal 2012.

For Fiscal 2012, net cash used in investing activities was ` 74.70 million. This was primarily due to ` 91.13million
used for purchase of fixed assets and intangible assets, partially offset by the generation of ` 16.43 million
from the sale of fixed assets.

Net cash generated in financing activities was ` 313.99 million for Fiscal 2013. This was primarily due to
issuance of Equity Share capital of ` 0.68 million, share premium gained from issuance of Equity Shares of ` 6.61
million, ` 418.00 million from issuance of tier II bonds by our Bank, which was partially offset by ` 74.60 million
used to pay interest on tier II bonds and ` 36.70 million used for payment of dividends (including taxes on
dividends).

Qualitative Disclosure about Risk and Risk Management

216
Interest rate risk

Since a substantial portion of our rupee liabilities are fixed rate bearing and we have a mix of floating and fixed-rate
assets (with rupee advances substantially floating rate bearing and investments wholly fixed rate bearing),
movements in domestic interest rates constitute the main source of interest rate risk. We assess and manage the
interest rate risk on our balance sheet through the process of asset-liability management. Our Market Risk
Management Policy and Liquidity Management Policy, which has been approved and adopted by our Board of
Directors, sets forth the broad guidelines for asset liability management activities. The asset liability management
function, inter alia, categorizes all rate sensitive assets and liabilities into various time period categories according
to interest rate sensitivity. We follow RBI guidelines for managing our asset and liability position. Our cost of
borrowings has been and will be negatively impacted by an increase in interest rates. Exposure to fluctuations in
interest rates is measured primarily by way of gap analysis, providing a static view of the maturity profile of our
assets and liabilities. An interest rate sensitivity report is prepared by classifying all assets and liabilities into various
categories according to interest rate sensitivity for reporting on a monthly basis to the ALCO. The difference
between the amounts of assets and liabilities maturing in any maturity category provides a measure of the extent to
which we are exposed to the risk of potential changes in the margins on new assets and liabilities.

Our asset and liability management committee meets on a monthly basis and reviews the interest rate and liquidity
gap positions on the book, formulates a view on interest rates, reviews the business profile and its impact on asset
liability management and determines the asset liability management strategy, in light of the then-current and
expected business environment.

Liquidity risk

Liquidity risk arises from the absence of liquid resources, when funding loans, and repaying deposits and
borrowings. This could be due to a decline in the expected collection, or our inability to raise adequate resources at
an appropriate price. This risk is minimized through a mix of strategies, including reducing reliance on bulk
deposits, maintaining adequate stock of liquid assets and following a forward-looking borrowing programme based
on projected loans and maturing obligations. We monitor liquidity risk through our asset liability management
function aided by liquidity gap reports. This involves the categorization of all assets and liabilities in different
maturity profiles, and evaluating them for any mismatches in any particular maturities, especially in the short term.
Our Liquidity Management Policy is based on RBI guidelines and the ALCO’s guidelines and establishes the
maximum allowed mismatches in the various maturities.

Exchange rate risk

The majority of our assets are financed in rupees and, therefore, we do not have any significant exchange rate risk
on our asset portfolio. We do not directly hedge exposures individually, though we manage our foreign currency
positions on a portfolio basis. As a financial intermediary, we are exposed to exchange rate risk on our merchant and
proprietary transactions, which we manage through methods such as maintaining currency wise intra-day and
overnight limits on uncovered positions specified by our Board of Directors. Some of these transactions also result
in credit exposure on counterparties, which is managed by setting suitable counterparty limits. Notwithstanding the
above, changes in exchange rates, including between the Rupee and the U.S. Dollar or any other foreign currency,
can affect the general economy, which could have an adverse impact on our business.

Indebtedness, contractual obligations, commitments, contingent liabilities and off-balance sheet arrangements

The following table summarizes our indebtedness, contractual obligations and commitments to make future
payments as of September 30, 2014, and the effect that such obligation and commitments are expected to have on
liquidity and cash flow in future periods.

(in ` million)
Particulars Fiscal 2015 Fiscal 2016 Fiscal2017 Post Fiscal 2017
Refinance from NABARD/NHB 126.48 36.48 Nil Nil
Repo borrowing 4,590 Nil Nil Nil
Tier II bonds 157 Nil Nil 418

217
 Particulars Fiscal 2015 Fiscal 2016 Fiscal2017 Post Fiscal 2017
Total Contractual Obligations 4,873.48 36.48 Nil 418

Contingent liabilities

As of September 30, 2014, we had the following contingent liabilities which have not been provided for in our
financial information.

(in ` million)
Particulars For the six
months ended
September 30, 2014
Claims against our Bank not acknowledged as debt 72.57
Liability on account of outstanding forward exchange contracts 5,406.24
Guarantees given on behalf of constituents
In India 2,096.30
Outside India -
Acceptance, Endorsement & other obligations 1,037.70
Other Items for which our Bank is contingently liable 187.36
Total 8,800.17
Bills for collection 763.54

Off-balance sheet arrangements

We do not have any other off-balance sheet arrangements, derivative instruments or other relationships with other
entities that have been established for the purpose of facilitating off-balance sheet arrangements.

Related Party Transactions

For details on related party transactions, please see the section titled “Related Party Transactions” on page F-178.

Information required as per Item IX(E) of Part A of Schedule VIII of the SEBI ICDR Regulations

Significant developments after September 30, 2014 that may affect our future results of operations

Except as stated below, there are no developments subsequent to September 30, 2014 that we believe is expected to have
a material impact on the reserves, profits/(losses), earnings/(losses) per share and book value of our Bank.

(i) We have received an amount of ` 34.06 million as share capital on preferential allotment of Equity Shares
and ` 579.04 towards share premium in respect of the Equity Shares allotted. See the section titled “Capital
Structure” on page 81.

(ii) We have undertaken a rights issue of Equity Shares and received an amount of ` 150.84 million as share
capital and ` 980.49 million towards share premium in respect of the Equity Shares allotted. See the section
titled “Capital Structure” on page 81.

(iii) One of our corporate advances amounting to ` 530.43 million turned into an NPA with a total adverse
impact of ` 290.57 million (` 191.81 after tax) in our profit and loss account, being ` 78.40 million on
account of interest reversal and ` 212.17 million on account of NPA provisioning.

(iv) Upon the finalisation and implementation of the 10th Bipartite Settlement employees of our Bank may get a
15% annual wage increase in salary and allowances (on salary slip components) effective from November 1,
2012. See the sub-section titled “ – Factors Affecting our Financial Results - Our ability to manage costs and
expenses” on page 193. We have, till September 30, 2014, provided for such expected wage revision estimating
the wage increase at 10%.

218
(v) Mr. Rakesh Bhatia resigned as our MD and CEO on March 20, 2015. See the section titled “Our Management”
on page 172.

Unusual or infrequent events or transactions

There have been no unusual or infrequent transactions that have taken place during the last three Fiscals years and
the six months ended September 30, 2014.

Significant economic changes that materially affected or are likely to affect income from continuing operations

Except as disclosed in this section, there are no significant economic changes that materially affected or are likely to
affect our income from continuing operations.

Known trends or uncertainties

Other than as described in the section titled “Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” on pages 13 and 191 respectively, to our knowledge there are no
known trends or uncertainties that have or had or are expected to have a material adverse impact on revenues or
income from continuing operations.

Future changes in relationship between costs and revenues

Other than as described in the section titled “Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” on pages 13 and 191respectively, to our knowledge there are no
future relationship between costs and revenues that have or had or are expected to have a material adverse impact on
our operations and finances.

The extent to which material increases in net sales or revenue are due to increased sales volume, introduction of
new products or services or increased sales prices.

Changes in income from operations during the last three Fiscal years are as explained in this section titled
“Management’s Discussion and Analysis of Financial Conditions and Results of Operations” on page 191.

Total turnover of each major industry segment in which the issuer operates

For details of the total turnover, please refer to the section titled “Financial Statements” on page 190.

New products or business segment

Except as stated in the section titled “Our Business” on page 127, we have not entered into any agreements for new
products or business segments or publicly announced introduction of any new products or services.

Seasonality of business

Our business is not seasonal in nature.

Significant dependence on single supplier /customer

See the section titled “Risk Factors – We have regional concentration in southern India, especially Kerala. Any
adverse change in the economic condition of Kerala and other states in southern India can impact our results of
operations. Additionally, we may not be successful in expanding our operations to other parts of India” and “Risk
Factors – We have a concentration of deposits from certain depositors, which exposes us to liquidity risk, the
crystallization of which could materially and adversely affect our business, financial conditions, result of operations
and prospects” on pages 14 and 23, respectively.

Competitive conditions

219
For details of our competitors, please refer to the discussions of our competition in the sections titled “Risk Factors”
and “Our Business” on pages 13 and 127.

220
 SELECTED STATISTICAL INFORMATION

The following information should be read together with our financial statements included in this Draft Red Herring Prospectus as well as the section titled “Management’s
Discussion and Analysis of Financial Condition and Results of Operation.” The amounts presented in this section are based on our financial statements prepared in accordance
with Indian GAAP and internally generated statistical data. These amounts do not give effect to the adjustment to our net profits as a result of their statement of our
unconsolidated financial statements in connection with this Issue.

Average Balance Sheet and Net Interest Margin

(` in million)
Year ending March 31, 2010 Year ending March 31, 2011 Year ending March 31, 2012
Interest
Income/ Interest Interest Average
Assets (Interest Average Interest Average Average Income/Interest Average Average Income/Interest yield/ cost
Earning) Balance expense yield/cost (%) Balance expense yield/cost(%) Balance expense (%)
Advances 36190.76 4171.31 11.53 52837.28 6007.41 11.37 67248.17 8615.04 12.81
Investments 27164.29 1413.12 5.20 26037.40 1553.24 5.97 30254.73 2008.63 6.64
Others 2807.50 195.13 6.95 774.42 60.67 7.83 835.83 132.67 15.87
Total Interest
Earning Assets
(Other than Interest
Bearing) 66162.55 5779.56 8.74 79649.10 7621.32 9.57 98338.73 10756.34 10.94
Fixed assets (
Including
Revaluation
reserve) 942.34 844.35 794.75
Other assets 6601.04 7347.18 8712.98
Total Assets 73705.93 5779.56 7.84 87840.63 7621.32 8.68 107846.46 10756.34 9.97
Less: Revaluation
Reserves 404.85 398.32 391.39
Net Total Assets 73301.08 5779.56 7.88 87442.31 7621.32 8.72 107455.07 10756.34 10.01
Liabilities
(Interest Bearing)
Deposits 64634.82 4460.44 6.90 77219.73 4963.09 6.43 94654.49 7380.10 7.80
of which:-
Demand 2881.78 0.00 0.00 2986.23 0.00 0.00 3060.67 0.00 0.00
Saving 13879.14 419.76 3.02 15667.93 546.50 3.49 16707.09 659.38 3.95
Term 47873.90 4040.68 8.44 58565.57 4416.59 7.54 74886.73 6720.72 8.97
Borrowings 1349.96 91.11 6.75 2050.29 176.70 8.62 3110.56 305.99 9.84
Borrowings ( Other
than Tier-II Bonds) 431.13 11.02 2.56 1131.46 85.93 7.59 2193.56 230.39 10.50
Tier- II Bonds 918.83 80.09 8.72 917.00 90.77 9.88 917.00 75.60 8.24
Total Interest
bearing Liabilities 65984.78 4551.55 6.90 79268.19 5139.79 6.48 97765.05 7686.09 7.86

221
Capital & Reserves 3867.88 4869.86 5511.06
Other Liabilities 3853.27 3702.58 4570.35
Total Liabilities 73705.93 87840.63 107846.46
Net Interest Income 1228.01 2481.53 3070.25
Net Interest
Income/Average
Net Total assets 1.68 2.84 2.86
Net profit before tax -197.85 292.60 297.04
Net profit After tax -61.88 199.73 260.44

Average Balance Sheet and Net Interest Margin

(` in million
Year ending March 31, 2013 Year ending March 31, 2014 Half Year ending September 30, 2014*
Interest Interest Interest
Income/ Income/ Income/
Average Interest Average Average Interest Average Average Interest Average
Assets ( Interest Earning) Balance expense yield/cost Balance expense yield/cost Balance expense yield/cost
Advances 82879.90 10743.45 12.96 86915.40 11386.97 13.10 90629.63 5762.99 12.72
Investments 32867.28 2262.59 6.88 45498.11 3304.09 7.26 50903.68 1862.06 7.32
Others 2192.73 202.60 9.24 3295.00 348.72 10.58 808.33 67.29 16.65
Total Interest Earning Assets (Other
than Interest Bearing) 117939.91 13208.64 11.20 135708.51 15039.78 11.08 142341.64 7692.34 10.81
Fixed assets ( Including Revaluation
reserve) 1255.43 1749.10 1792.25
Other assets 9451.71 9342.00 9630.90
Total Assets 128647.05 13208.64 10.27 146799.61 15039.78 10.25 153764.79 7692.34 10.00
Less: Revaluation Reserves 827.39 1260.12 1249.78
Net Total Assets 127819.66 13208.64 10.33 145539.49 15039.78 10.33 152515.01 7692.34 10.09
Liabilities ( Interest Bearing)
Deposits 113050.54 9502.27 8.41 129439.90 10942.40 8.45 135488.80 5661.42 8.36
of which:-
Demand 3111.87 0.00 0.00 3098.29 0.00 0.00 3468.64 0.00 0.00
Saving 17925.33 713.91 3.98 19281.81 768.33 3.98 20915.90 419.06 4.01
Term 92013.34 8788.36 9.55 107059.80 10174.07 9.50 111104.26 5242.36 9.44
Borrowings 3465.97 314.21 9.07 3639.88 305.34 8.39 4837.67 192.58 7.96
Borrowings ( Other than Tier-II Bonds) 2277.64 200.95 8.82 2489.88 194.66 7.82 4212.67 157.45 7.48
Tier- II Bonds 1188.33 113.26 9.53 1150.00 110.67 9.62 625.00 35.12 11.24
Total Interest bearing Liabilities 116516.51 9816.48 8.42 133079.78 11247.73 8.45 140326.47 5853.99 8.34
Capital & Reserves 6276.21 7792.06 7814.19
Other Liabilities 5854.33 5927.77 5624.13
Total Liabilities 128647.05 146799.61 153764.79
Net Interest Income 3392.16 3792.02 1838.34
Net Interest Income/Average Net Total 2.65 2.61 2.41

222
assets
Net profit before tax 327.46 468.98 -276.12
Net profit After tax 266.17 309.46 -181.47
* Annualized

Analysis of Changes In Interest Income & Interest Expense Volume And Rate Analysis

The following table sets forth, for the periods indicated, the allocation of the changes in our interest income and interest expense between average volume and changes in average
rates. The changes in net interest income between periods have been reflected as attributed either to volume or rate changes. For the purposes of this table, changes that are due to
both volume and rate have been allocated solely to changes in rate.
(` in million)
Fiscal 2011 Vs Fiscal 2010 Fiscal 2012 Vs Fiscal 2011 Fiscal 2013 Vs Fiscal 2012 Fiscal 2014 Vs Fiscal 2013
Net Net
Changes Changes Change Changes
Net Change due to in Change Changes Net due to Changes in Change Changes
Changes in due to change Interest due to due to Changes in change due to Interest due to due to
Interest change in in income change in change in Interest in change in income change in change in
income or average average or average average income or average average or average average
expense rate volume expense rate volume expense rate volume expense rate volume
Interest Income : 1841.76 123.03 1718.73 3135.02 1240.16 1894.86 2452.30 60.91 2391.39 1831.14 336.67 1494.47
Advances 1836.10 -82.56 1918.66 2607.63 969.16 1638.47 2128.41 125.86 2002.55 643.52 120.41 523.11
Investments 140.12 198.74 -58.62 455.39 203.81 251.58 253.96 80.51 173.45 1041.50 171.99 869.51
Others -134.46 6.85 -141.31 72.00 67.19 4.81 69.93 -145.46 215.38 146.12 44.27 101.85
Interest Expense : 588.24 -386.01 974.25 2546.30 1198.56 1347.73 2130.39 514.08 1616.31 1431.25 -74.95 1506.20
Deposits 502.65 -453.85 956.50 2417.01 1149.94 1267.07 2122.17 537.07 1585.10 1440.13 -51.01 1491.14
Demand Deposits 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Saving Deposits 126.74 72.64 54.10 112.88 76.63 36.25 54.53 6.45 48.08 54.42 0.40 54.02
Term Deposits 375.91 -526.49 902.40 2304.13 1073.30 1230.83 2067.64 530.61 1537.03 1385.71 -51.40 1437.11
Borrowings 74.91 57.00 17.90 144.46 63.80 80.66 -29.44 -38.27 8.83 -6.29 -25.00 18.71
Tier-II Bonds 10.68 10.84 -0.16 -15.17 -15.17 0.00 37.66 15.29 22.37 -2.59 1.07 -3.65
Net Interest Income 1253.51 507.58 745.94 588.72 43.97 544.76 321.90 -453.18 775.07 399.89 411.61 -11.75

Yields, Spreads And Margins

(` in million)
For the Period ended 2010 2011 2012 2013 2014 30.09.2014
1).Interest Income 5779.56 7621.32 10756.34 13208.64 15039.78 7692.34
2)Average Interest earning Assets 66162.55 79649.10 98338.73 117939.91 135708.51 142341.64
3)Interest Expense 4551.55 5139.79 7686.09 9816.48 11247.73 5853.99
4)Average interest bearing Liabilities 65984.78 79268.19 97765.05 116516.51 133079.78 140326.47
5)Net Interest Income ( 1-3 ) 1228.01 2481.53 3070.25 3392.16 3792.04 1838.34
6)Net Profit After Tax -61.88 199.73 260.44 266.17 309.46 -181.47
7)Average Net Total assets (Net of Revaluation 73301.08 87442.31 107455.07 127819.66 145539.49 152515.01
Reserve)

223
8)Average Share Capital & Reserves (Net of 3463.03 4471.54 5119.67 5448.82 6531.94 6564.41
Revaluation Reserve)
9)Average interest earning assets as % of average 90.26% 91.09% 91.52% 92.27% 93.25% 93.33%
net total assets ( 2 / 7 )
10)Average interest bearing liabilities as % of 90.02% 90.65% 90.98% 91.16% 91.44% 92.01%
average net total assets ( 4 / 7 )
11)Average interest earning assets as % of 100.27% 100.48% 100.59% 101.22% 101.98% 101.44%
average interest bearing liabilities [ 2 / 4 ]
12)Yield ( 1 / 2 ) 8.73% 9.57% 10.94% 11.20% 11.08% 10.81%*
13)Average Cost of Loan Funds ( 3 / 4 ) 6.90% 6.48% 7.86% 8.42% 8.45% 8.34%*
14)Spread [ 13-14 ] 1.83% 3.09% 3.08% 2.78% 2.63% 2.47%
15)Net Interest Income/Average earning assets 1.86% 3.12% 3.12% 2.88% 2.79% 2.58%*
(5/2) / 2)
16)Return on average net total assets [ 6 / 7 ] -0.08% 0.23% 0.24% 0.21% 0.21% -0.24%*
17)Average Share Capital & Reserves to Average 4.72% 5.11% 4.76% 4.26% 4.49% 4.30%
Total Net Assets [ 8 / 7 ]
18)Profit Available for Equity shareholders to -1.79% 4.47% 5.09% 4.88% 4.74% -5.53%*
Average Equity Share Holders fund
* Annualized

Total Deposits
(` in million)
As on 31.03.2010 As on 31.03.2011 As on 31.03.2012 As on 31.03.2013 As on 31.03.2014 As on 30.09.2014
Balance % of Balance % of Balance % of Balance % of Balance % of Balance % of
O/S Total O/S Total O/S Total O/S Total O/S Total O/S Total
Demand Deposit
(A) 2920.88 4.19% 3268.99 3.75% 3478.59 3.28% 3293.55 2.67% 3314.45 2.42% 3895.03 2.75%
From Banks 6.05 0.01% 12.19 0.01% 14.49 0.01% 3.88 0.00% 5.32 0.00% 2.51 0.00%
From Others 2914.83 4.18% 3256.80 3.73% 3464.10 3.27% 3289.67 2.67% 3309.13 2.42% 3892.52 2.75%
Savings Deposits
(B) 14605.94 20.93% 16242.46 18.61% 17004.97 16.04% 18340.40 14.86% 20295.38 14.84% 21553.38 15.22%
CASA(A+B) 17526.82 25.12% 19511.45 22.36% 20483.56 19.32% 21633.95 17.53% 23609.83 17.27% 25448.41 17.97%
Term Deposits 52256.68 74.88% 67745.24 77.64% 85565.14 80.68% 101782.31 82.47% 113128.78 82.73% 116206.61 82.03%
From Banks 1671.39 2.40% 2804.42 3.21% 4213.90 3.97% 4594.61 3.72% 4989.09 3.65% 3681.08 2.60%
From Others 50585.29 72.49% 64940.82 74.43% 81351.24 76.71% 97187.70 78.75% 108139.69 79.08% 112525.53 79.44%
Total Deposits 69783.50 100.00% 87256.69 100.00% 106048.70 100.00% 123416.26 100.00% 136738.61 100% 141655.02 100.00%

Break-up of Deposits
Break-up of Deposits of the Bank for the last 5 years is as under.
(` in million)
Particulars 31-Mar-10 31-Mar-11 31-Mar-12 31-Mar-13 31-Mar-14 30-Sep-14
Demand Deposits (Including 2920.88 3268.99 3478.59 3293.55 3314.45 3895.03

224
Demand Deposit From
Banks)
Saving Bank Deposits 14605.94 16242.46 17004.97 18340.40 20295.38 21553.38
Term Deposits 52256.68 67745.24 85565.14 101782.31 113128.78 116206.61
Bulk (accepted under DRI –
Other than Card Rate) 8698.2 16464.1 20495 27240.7 28966.40 29090.60
Retail 43558.48 51281.14 65070.14 74541.61 84162.38 87116.01

Total 69783.50 87256.69 106048.70 123416.26 136738.61 141655.02

Maturity Profile of Deposits (Behavioural maturity of Deposits)

Maturity profile of deposits at the end of last 5 Fiscal years and as of Half year ended 30 September 2014 is as under:
(` in million)
Year ended 31-Mar-10 31-Mar-11 31-Mar-12 31-Mar-13 31-Mar-14 30-Sep-14
Amount % Amount % Amount % Amount % Amount % Amount %
Upto 1 year 13709.2 19.65% 19151.3 21.95% 25471.2 24.02% 29500.1 23.90% 31853.4 23.30% 31824.54 22.47%
1 year to 3 years 19247.9 27.58% 23768.2 27.24% 26852.4 25.32% 31789.4 25.76% 31039 22.70% 32887.96 23.22%
3 years to 5 years 1543.1 2.21% 954.9 1.09% 1175.7 1.11% 1914.9 1.55% 3584 2.62% 3430.66 2.42%
Over 5 years 35283.3 50.56% 43382.3 49.72% 52549.4 49.55% 60211.9 48.79% 70262.2 51.38% 73511.86 51.89%
Total 69783.5 100.00% 87256.7 100.00% 106048.7 100.00% 123416.3 100.00% 136738.6 100.00% 141655.02 100.00%

Break up of Gross Advances

(` in million)
As on 31.03.2010 As on 31.03.2011 As on 31.03.2012 As on 31.03.2013 As on 31.03.2014 As on 30.09.2014
Asset Classification Amount % Amount % Amount % Amount % Amount % Amount %
Standard Assets 43952.20 96.71% 61101.00 96.95% 75847.60 97.64% 87651.1 97.65% 85204.70 96.23% 90741.9 94.44%
NPA 1492.90 3.29% 1924.50 3.05% 1829.30 2.36% 2108.60 2.35% 3335.50 3.77% 5345.8 5.56%
Of which
Sub Standard 368.20 0.81% 811.40 1.29% 612.70 0.80% 894.00 1.00% 938.70 1.06% 2895.8 3.01%
Doubtful 1038.90 2.29% 1025.80 1.63% 1135.50 1.46% 1156.80 1.29% 2339.00 2.64% 2389.7 2.49%
Loss 85.80 0.19% 87.30 0.13% 81.10 0.10% 57.80 0.06% 57.80 0.07% 60.3 0.06%
Total 45445.10 100.00% 63025.50 100.00% 77676.90 100.00% 89759.70 100.00% 88540.20 100.00% 96087.7 100.00%

Non Performing Assets after restating provisions

(` in million)
Item As on
2010 2011 2012 2013 2014 30.09.2014
Net NPAs to Net Advances (%) 1.58% 1.74% 1.10% 1.12% 2.22% 3.76%
ii)Movement of NPAs (Gross)
a) Opening Balance 1717.80 1492.90 1924.50 1829.30 2108.60 3335.50

225
b) Additions during the year 534.80 1078.70 1002.00 1713.10 3903.60 2710.70
c) Reductions during the year 759.70 647.10 1097.20 1433.80 2676.70 700.50
d) Closing Balance 1492.90 1924.50 1829.30 2108.60 3335.50 5345.70
iii)Movement of Net NPAs 0.00 0.00 0.00 0.00 0.00 0
a) Opening Balance 879.40 705.20 1084.00 842.10 992.50 1932.40
b) Additions during the year 521.00 938.10 449.90 1426.90 3200.90 2299.80
c) Reductions during the year 695.20 559.30 691.80 1276.50 2261.00 689.10
d) Closing Balance 705.20 1084.00 842.10 992.50 1932.40 3543.10
iv)Movement of provisions for NPA 0.00 0.00 0.00 0.00 0.00 0.00
(Excluding provisions on standard Assets) 0.00 0.00 0.00 0.00 0.00 0.00
a) Opening Balance 798.80 752.30 806.6 780.60 910.20 1351.40
b) Additions during the year 43.20 85.50 140.4 391.80 655.00 560.60
c) Reductions during the year 89.70 31.20 166.4 262.20 213.80 135.70
d) Closing Balance 752.30 806.60 780.6 910.20 1351.40 1776.30

Restructured Assets
(` in million)
For the period ending
CDR Restructured Assets 31.03.2010 31.03.2011 31.03.2012 31.03.2013 31.03.2014 30.09.2014
Standard Assets 121.90 106.40 1236.90 2715.40 1699.90 649.70
Sub-standard Assets 0.00 0.00 0.00 0.00 0.00 0.00
Doubtful Assets 0.00 0.00 0.00 0.00 459.90 460.00
Loss Assets 0.00 0.00 0.00 0.00 0.00 0.00
Total CDR Restructured Assets 121.90 106.40 1236.90 2715.40 2159.80 1109.70
Others Restructured Assets
Standard Assets 1247.20 781.30 2167.80 2786.70 1892.20 1858.80
Sub Standard Assets 8.40 61.50 14.30 29.30 56.40 0.33
Doubtful Assets 0.00 8.00 42.30 22.20 16.20 16.10
Loss Assets 0.00 0.00 0.00 0.00 0.00 0.00
Total Others Restructured Assets 1255.60 850.80 2224.40 2838.20 1964.80 1875.23
Total Restructured Assets 1377.50 957.20 3461.30 5553.60 4124.60 2984.93

Statement of 10 largest Gross Non Performing Assets

The followingtables sets forth our 10 largest gross non-performing assets. Together these borrowers constitute 59.01% of our gross NPAs as on September 30,2014
(` in million)
31.03.2010 31.03.2011 31.03.2012 31.03.2013 31.03.2014 30.09.2014
Provision Provision Provision Provision Provision Provision
Borrower GNPA held GNPA held GNPA held GNPA held GNPA held GNPA held

Borrower-1 79.90 16.00 175.90 17.60 170.00 0.00 202.70 30.40 577.86 144.50 600.00 90.00
Borrower-2 75.20 0.00 82.30 35.80 104.20 104.20 170.00 170.00 480.00 192.00 577.86 231.14

226
Borrower-3 63.50 63.50 79.90 24.00 89.80 0.00 100.00 25.00 202.70 50.70 500.00 75.00

Borrower-4 58.40 58.40 71.70 7.20 51.60 0.00 59.90 9.00 170.00 170.00 480.44 72.07

Borrower-5 52.80 52.80 52.80 52.80 38.10 0.00 53.40 8.00 166.40 25.00 480.10 192.04

Borrower-6 50.00 10.00 45.10 0.00 33.20 0.00 46.00 9.20 114.70 17.20 170.01 170.01

Borrower-7 43.80 21.30 43.80 21.30 27.80 0.00 38.20 4.50 91.60 13.70 134.66 20.20

Borrower-8 17.60 5.30 33.30 0.00 22.40 0.00 33.20 0.00 57.50 8.60 114.91 28.73

Borrower-9 16.80 3.40 28.10 2.80 20.30 0.00 31.50 4.70 45.80 6.90 48.68 7.30

Borrower-10 13.50 13.50 24.40 2.40 19.30 9.80 27.80 5.60 44.20 10.60 48.06 7.21

Statement of 10 Largest Single Exposure

(` in million)
As on 31.03.2010 As on 31.03.2011 As on 31.03.2012
%of %of %of %of %of %of
%of total Capit Tota %of total Capit Tota %of total Capit Tota
outstandi al l Asset outstandi al l Asset outstandi al l Asset
Borrow Exposu ng Fund Asse Classificat Exposu ng Fund Asse Classificat Exposu ng Fund Asse Classificat
er re exposure s ts ion re exposure s ts ion re exposure s ts ion
Borrow 14.95 0.79 Standard 18.02 1.03 Standard 18.22 0.93 Standard
er-I 601.51 0.70% % % 1009.94 0.91% % % 1113.54 0.81% % %
Borrow 14.91 0.79 Standard 17.84 1.02 Standard 14.18 0.72 Standard
er -II 600.00 0.70% % % 1000.00 0.91% % % 866.87 0.63% % %
Borrow 13.34 0.70 Standard 12.62 0.72 Standard 12.37 0.63 Standard
er -III 536.60 0.62% % % 707.45 0.64% % % 756.15 0.55% % %
Borrow 12.55 0.66 Standard 12.47 0.72 Standard 11.58 0.59 Standard
er -IV 504.88 0.59% % % 698.85 0.63% % % 708.07 0.52% % %
Borrow 12.43 0.66 Standard 11.26 0.65 Standard 9.84 0.50 Standard
er -V 500.00 0.58% % % 631.30 0.57% % % 601.61 0.44% % %
Borrow 12.43 0.66 Standard 10.82 0.62 Standard 9.11 0.47 Standard
er -VI 500.00 0.58% % % 606.63 0.55% % % 557.11 0.41% % %
Borrow 12.43 0.66 Standard 10.77 0.62 Standard 10.14 0.52 Standard
er -VII 500.00 0.58% % % 603.75 0.55% % % 619.65 0.45% % %
Borrow 12.43 0.66 Standard 10.71 0.61 Standard 10.06 0.51 Standard
er -VIII 500.00 0.58% % % 600.16 0.54% % % 615.27 0.45% % %
Borrow 12.43 0.66 Standard 7.91 0.45 Standard 9.91 0.51 Standard
er -IX 500.00 0.58% % % 443.45 0.40% % % 605.69 0.44% % %

227
Borrow 9.94 0.53 Standard 10.70 0.61 Standard 9.10 0.46 Standard
er -X 400.01 0.46% % % 600.00 0.54% % % 556.12 0.41% % %

(` in million)
As on 31.03.2013 As on 31.03.2014 As on 30.09.2014
%of %of %of %of %of
%of total %of total %of %of total
Capit Tota Asset Tota Asset Capit Tota Asset
Borrow Exposu outstandi Exposu outstandi Capit Exposu outstandi
al l Classificat l Classificat al l Classificat
er re ng re ng al re ng
Fund Asse ion Asse ion Fund Asse ion
exposure exposure Fund exposure
s ts ts s ts
Borrow 18.56 1.01 Standard 20.36 0.99 Standard 22.65 0.98
er - I 1356.02 0.88% % % 1499.52 0.93% % % 1522.47 0.93% % % Standard
Borrow 10.88 0.59 Standard 16.50 0.80 Standard 17.18 0.74
er -II 794.81 0.52% % % 1214.87 0.76% % % 1154.79 0.71% % % Standard
Borrow 9.95 0.54 Standard 10.85 0.53 Standard 14.27 0.62
er -III 727.21 0.47% % % 798.86 0.50% % % 959.47 0.59% % % Standard
Borrow 8.92 0.48 Standard 10.86 0.53 Standard 11.97 0.52
er -IV 651.44 0.42% % % 800.00 0.50% % % 804.91 0.49% % % Standard
Borrow 9.38 0.51 Standard 9.69 0.47 Standard 10.41 0.45
er -V 685.46 0.45% % % 713.79 0.45% % % 700.00 0.43% % % Standard
Borrow 650.35 0.42% 8.90 0.48 Standard 620.58 0.39% 8.43 0.41 Standard 600.00 0.37% 8.93 0.39 NPA
er -VI % % % % % %
Borrow 8.36 0.45 Standard 8.86 0.43 Standard 9.46 0.41
er -VII 611.17 0.40% % % 652.36 0.41% % % 635.71 0.39% % % Standard
Borrow 7.82 0.42 Standard 7.85 0.38 NPA 8.60 0.37
er -VIII 571.33 0.37% % % 577.86 0.36% % % 577.86 0.35% % % NPA
Borrow 7.27 0.40 Standard 7.06 0.34 NPA 7.74 0.33
er -IX 531.55 0.35% % % 519.98 0.32% % % 520.10 0.32% % % NPA
Borrow 7.25 0.39 Standard 7.47 0.36 Standard 7.44 0.32
er -X 530.00 0.35% % % 550.24 0.34% % % 500.00 0.31% % % NPA

Statement of 10 largest Group Exposure

(` in million)
As on 31.03.2010 As on 31.03.2011 As on 31.03.2012
%of %of %of %of %of %of
%of total %of total %of total
Capit Tota Asset Capit Tota Asset Capit Tota Asset
Borrow Exposu outstandi Exposu outstandi Exposu outstandi
al l Classificati al l Classificati al l Classificati
er re ng re ng re ng
Fund Asse on Fund Asse on Fund Asse on
exposure exposure exposure
s ts s ts s ts
Group I 842.05 0.98% 20.93 1.11 Standard 903.30 0.82% 16.12 0.93 Standard 999.40 0.73% 16.35 0.83 Standard
% % % % % %
Group 765.81 0.89% 19.03 1.01 Standard 796.90 0.72% 14.22 0.82 Standard 759.40 0.55% 12.42 0.63 Standard
II % % % % % %
Group 587.33 0.68% 14.60 0.77 Standard 704.30 0.64% 12.57 0.72 Standard 729.60 0.53% 11.94 0.61 Standard

228
III % % % % % %
Group 468.15 0.54% 11.64 0.61 Standard 495.30 0.45% 0.51 Standard 618.20 0.45% 10.11 0.52 Standard
IV % % 8.84% % % %
Group 324.29 0.38% 0.43 Standard 487.50 0.44% 0.50 Standard 562.20 0.41% 0.47 Standard
V 8.06% % 8.70% % 9.20% %
Group 299.04 0.35% 0.39 Standard 437.60 0.40% 0.45 Standard 543.50 0.40% 0.45 Standard
VI 7.43% % 7.81% % 8.89% %
Group 273.35 0.32% 0.36 Standard 436.70 0.40% 0.45 Standard 528.00 0.38% 0.44 Standard
VII 6.79% % 7.79% % 8.64% %
Group 270.00 0.31% 0.35 Standard 328.80 0.30% 0.34 Standard 510.40 0.37% 0.43 Standard
VIII 6.71% % 5.87% % 8.35% %
Group 267.30 0.31% 0.35 Standard 295.60 0.27% 0.30 Standard 488.70 0.36% 0.41 Standard
IX 6.64% % 5.27% % 7.99% %
Group 266.50 0.31% 0.35 Standard 288.30 0.26% 0.30 Standard 459.90 0.34% 7.52% 0.38 Standard
X 6.62% % 5.14% % %

(` in million)
As on 31.03.2013 As on 31.03.2014 As on 30.09.2014
%of %of %of %of %of %of
%of total %of total %of total
Capit Tota Asset Capit Tota Asset Capit Tota Asset
Borrow Exposu outstandi Exposu outstandi Exposu outstandi
al l Classificat al l Classificat al l Classificat
er re ng re ng re ng
Fund Asse ion Fund Asse ion Fund Asse ion
exposure exposure exposure
s ts s ts s ts
862.80 0.56% 11.81 0.64 Standard 2358.00 1.47% 32.02 1.55 Standard 2327.4 1.43% 34.62 1.50 Standard
Group I
% % % % % %
Group 778.00 0.51% 10.65 0.58 Standard 907.30 0.57% 12.32 0.60 Standard 907.8 0.56% 13.50 0.58 Standard
II % % % % % %
Group 656.60 0.43% 8.99 0.49 Standard 814.80 0.51% 11.06 0.54 Standard 595.3 0.37% 8.86 0.38 Standard
III % % % % % %
Group 507.50 0.33% 6.95 0.38 Standard 758.90 0.47% 10.30 0.50 Standard 529.2 0.32% 7.87 0.34 Standard
IV % % % % % %
Group 499.80 0.33% 6.84 0.37 Standard 558.20 0.35% 7.58 0.37 Standard 455 0.28% 6.77 0.29 Standard
V % % % % % %
Group 451.50 0.29% 6.18 0.34 Standard 446.20 0.28% 6.06 0.29 Standard 380.1 0.23% 5.65 0.24 Standard
VI % % % % % %
Group 420.50 0.27% 5.75 0.31 Standard 379.30 0.24% 5.15 0.25 Standard 379 0.23% 5.64 0.24 Standard
VII % % % % % %
Group 404.00 0.26% 5.53 0.30 Standard 378.30 0.24% 5.14 0.25 Standard 370.3 0.23% 5.51 0.24 Standard
VIII % % % % % %
Group 385.00 0.25% 5.27 0.29 Standard 374.30 0.23% 5.08 0.25 Standard 346.7 0.21% 5.16 0.22 Standard
IX % % % % % %
Group 365.00 0.24% 5.00 0.27 Standard 317.70 0.20% 4.31 0.21 Standard 322.7 0.20% 4.80 0.21 Standard
X % % % % % %

229
Loan Portfolio (Facility-wise)-Gross Advance
(` in million)
Category As of March 31, 2010 As of March 31,2011 As of March 31, 2012 As of March 31,2013 As of March 31, 2014 As on September 30,2014
Amount % Amount % Amount % Amount % Amount % Amount %
Bills 784.94 1.73% 1095.25 1.74% 1949.47 2.51% 2547.67 2.84% 4742.52 5.36% 8014.61 8.34%
Demand Loans 28171.73 61.99% 38423.14 60.96% 50905.13 65.53% 63826.72 71.11% 57328.17 64.75% 61775.60 64.29%
Term loans 16488.41 36.28% 23507.09 37.30% 24822.30 31.96% 23385.32 26.05% 26469.51 29.90% 26297.44 27.37%
Total 45445.08 100.00% 63025.48 100.00% 77676.90 100.00% 89759.71 100.00% 88540.20 100.00% 96087.65 100.00%

Loan Portfolio (Sector-wise)-Gross Advance

(` in million)
Category As of March 31, 2010 As of March 31, 2011 As of March 31, 2012 As of March 31, 2013 As of March 31, 2014 As of Sept. 30, 2014
Amount % Amount % Amount % Amount % Amount % Amount %
Housing &
Retail 5355.10 11.78% 6294.00 9.99% 6573.50 8.46% 5075.60 5.65% 5024.80 5.68% 5880.90 6.12%
Corporate * 17851.75 39.28% 27358.17 43.41% 29591.10 38.10% 28184.65 31.40% 28202.47 31.85% 31253.43 32.75%
Others 22238.23 48.93% 29373.31 46.61% 41512.30 53.44% 56499.46 62.95% 55312.93 62.47% 58953.32 61.13%
Total 45445.08 100.00% 63025.48 100.00% 77676.90 100.00% 89759.71 100.00% 88540.20 100.00% 96087.65 100.00%
* Definition of corporate as per Basel II guidelines

Priority Sector Lending

Details of sector-wise distribution of Gross Priority Sector advances for the last 5 years are given below:
(` in million)
Reporting date 31-Mar-10 31-Mar-11 31-Mar-12 31-Mar-13 31-Mar-14 30-Sep-14
Total Priority Sector Advances 14,810.40 2,1750.5 2,5320.60 1,9134.5 25,666.90 32,140.20
Total Agricultural Advances 5,512.00 9,285.20 11,464.60 4,9787.0 4,283.20 6,481.10
Weaker Section Advances 143.10 8,090.00 10,324.00 4,102.80 2,644.10 5,485.20

Loan Portfolio (Security-wise)-Gross Advance

(` in million)
As of March 31, As of March 31, As of March 31, As on September
Category 2010 As of March 31,2011 2012 As of March 31,2013 2014 30,2014
Amount % Amount % Amount % Amount % Amount % Amount %
Secured by tangible
assets(includes advances
against book debts 39810.41 87.60% 55566.62 88.17% 72260.26 93.03% 83623.76 93.16% 80149.83 90.52% 84822.02 88.28%
Covered by Bank/
Government Guarantees 607.64 1.34% 1359.32 2.16% 1845.01 2.38% 2567.36 2.86% 4919.63 5.56% 6601.57 6.87%
Unsecured 5027.03 11.06% 6099.54 9.68% 3571.63 4.60% 3568.59 3.98% 3470.74 3.92% 4664.06 4.85%
Total 45445.08 100.00% 63025.48 100.00% 77676.90 100.00% 89759.71 100.00% 88540.20 100.00% 96087.65 100.00%

230
Industry wise Total Outstanding and Outstanding of Top 10 Companies in respective Industry
(` in million)
As on 31.03.2010 As on 31.03.2011 As on 31.03.2012
Funded Funded Funded
Funded Outstanding Funded Outstanding Funded Outstanding
Outstanding to top ten Outstanding to top ten Outstanding to top ten
Funded to top ten companies Funded to top ten companies Funded to top ten companies
Industry
Outstanding companies as a % of Outstanding companies as a % of Outstanding companies as a % of
in the outstanding in the outstanding in the outstanding
industry to the industry to the industry to the
industry industry industry
All engineering 912.04 678.27 74.37 1449.27 1082.75 74.71 2157.86 1603.06 74.29
Automobiles 891.69 850.64 95.40 1747.96 1589.95 90.96 1794.58 1662.30 92.63
Cement 24.20 14.61 60.37 227.56 215.35 94.63 37.35 22.54 60.35
Chemicals 2283.79 1898.97 83.15 3151.16 2704.38 85.82 2656.11 2212.80 83.31
Coal 4.89 4.89 100.00 5.76 5.75 99.84 4.40 4.40 100.00
Construction 1143.96 625.87 54.71 2805.38 1676.91 59.77 2907.12 1622.93 55.83
Food 657.63 307.63 46.78 1241.25 621.70 50.09 1318.53 537.06 40.73
Infrastructure 2573.32 2196.03 85.34 4192.68 3513.57 83.80 4352.52 3647.24 83.80
Iron and steel 44.83 43.40 96.81 57.45 52.67 91.68 53.33 45.85 85.97
Jewelleries 50.60 39.73 78.51 101.80 70.99 69.73 161.29 107.20 66.46
Leather 95.69 54.24 56.68 86.74 47.72 55.01 64.34 42.78 66.49
Mining 143.55 137.01 95.44 297.53 230.43 77.45 368.46 257.92 70.00
NBFC 571.69 485.91 85.00 593.46 520.46 87.70 1350.86 1323.06 97.94
Oil 71.98 68.27 94.84 133.42 127.14 95.29 54.56 51.00 93.47
Other Industries 1063.13 593.15 55.79 1129.73 452.25 40.03 1398.14 478.80 34.25
Other metals and metal products 450.59 377.76 83.84 410.83 306.72 74.66 494.54 362.82 73.37
Paper 187.30 139.19 74.31 285.14 202.57 71.04 293.08 193.47 66.01
Petroleum 9.15 9.15 100.00 20.59 20.59 100.00 21.83 21.83 100.00
Rubber 89.12 67.78 76.06 178.23 125.04 70.15 211.33 137.25 64.95
Software 17.21 15.21 88.38 133.90 129.64 96.82 152.06 145.97 95.99
Sugar 2.35 2.35 100.00 2.06 2.06 100.00 0.15 0.15 100.00
Tea 1.18 1.18 100.00 40.70 40.70 100.00 49.22 49.22 100.00
Textiles 4728.63 967.84 20.47 6307.13 1770.56 28.07 5215.61 1551.98 29.76
Tobacco and Beverages 288.96 287.52 99.50 282.38 280.49 99.33 134.80 133.53 99.06
Total 16307.48 9866.60 1905.75 24882.11 15790.39 1896.58 25252.07 16215.16 1834.66

231
 (` in million)
As on 31.03.2013 As on 31.03.2014 As on 30.09.2014
Funded Funded Funded
Funded Outstanding Funded Outstanding Funded Outstanding
Outstanding to top ten Outstanding to top ten Outstanding to top ten
Funded to top ten companies Funded to top ten companies Funded to top ten companies
Industry
Outstanding companies as a % of Outstanding companies as a % of Outstanding companies as a % of
in the outstanding in the outstanding in the outstanding
industry to the industry to the industry to the
industry industry industry
All engineering 1340.22 871.17 65.00 973.11 580.69 59.67 1104.57 677.62 61.35
Automobiles 1349.81 1133.60 83.98 1102.34 1003.24 91.01 1022.35 908.45 88.86
Cement 49.28 29.99 60.86 65.01 37.78 58.11 64.18 35.42 55.19
Chemicals 2533.56 2107.35 83.18 2437.78 2158.18 88.53 1588.98 1454.51 91.54
Coal 2.08 2.08 100.00 1.99 1.99 100.00 2.99 2.99 100.00
Construction 3166.40 1789.82 56.53 3541.41 1819.85 51.39 4207.58 2278.11 54.14
Food 1805.65 772.61 42.79 1707.54 797.86 46.73 2561.60 1290.96 50.40
Infrastructure 4209.92 3125.27 74.24 3505.51 2580.13 73.60 4055.03 2661.87 65.64
Iron and steel 137.88 120.85 87.65 160.77 142.11 88.39 161.67 146.02 90.32
Jewelleries 155.70 106.08 68.13 772.29 666.36 86.28 732.47 598.83 81.75
Leather 78.09 54.80 70.18 154.44 124.23 80.44 134.58 104.35 77.54
Mining 356.89 239.39 67.08 418.07 263.37 63.00 406.16 260.35 64.10
NBFC 1499.60 1451.01 96.76 744.93 723.79 97.16 742.28 691.94 93.22
Oil 59.18 54.46 92.02 58.07 54.96 94.64 64.35 62.30 96.81
Other Industries 2129.73 1130.39 53.08 2296.81 1168.98 50.90 2033.82 907.86 44.64
Other metals and metal products 502.59 382.21 76.05 484.93 331.13 68.28 518.53 338.05 65.19
Paper 310.06 192.54 62.10 291.86 180.11 61.71 308.77 182.55 59.12
Petroleum 19.70 19.70 100.00 21.01 21.01 100.00 22.45 22.45 100.00
Rubber 201.84 135.40 67.08 253.85 179.14 70.57 284.79 200.93 70.56
Software 146.71 143.76 97.99 47.43 44.94 94.75 50.43 47.27 93.73
Sugar 0.14 0.14 100.00 0.05 0.05 100.00 0.05 0.05 100.00
Tea 45.25 45.25 100.00 46.36 46.36 100.00 49.14 49.14 100.00
Textiles 5422.40 1726.42 31.84 5239.70 1718.94 32.81 5081.56 1569.55 30.89
Tobacco and Beverages 21.07 20.83 98.86 26.59 26.10 98.16 22.95 22.70 98.91
Total 25543.75 15655.12 1835.40 24351.85 14671.30 1856.13 25221.28 14514.27 1833.90

232
ASSETS - LIABILITIES GAP

The following table sets forth our asset - liability as on March 31, 2010
(` in million)
OUTFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1. Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 189.26 189.26
2. Reserves& Surplus 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2832.73 2832.73
3[i] Current Deposit 147.90 190.44 269.54 0.00 0.00 0.00 0.00 2271.21 0.00 41.79 2920.88
3[ii] Savings Deposit 42.36 111.01 157.74 0.00 0.00 0.00 0.00 14294.83 0.00 0.00 14605.94
3[iii] Term Deposit. 43.72 187.08 341.62 414.18 1920.37 1980.81 7902.46 2681.82 1543.07 35241.55 52256.68
3[iv] Certificate of Deposit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[I] Borrowing 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[ii]Inter-Bank Term 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[iii]Refinances 0.00 0.00 0.00 0.00 0.09 0.09 0.19 0.36 0.00 0.00 0.73
4[iv] Others 0.00 0.00 0.00 0.00 11.00 0.00 0.00 160.00 757.00 0.00 928.00
5 [I] Bills Payable 50.98 134.88 2.07 0.00 0.00 0.00 0.00 0.00 0.00 0.00 187.93
5[ii] Inter-office Adjustment 305.02 0.00 0.00 0.00 128.58 14.12 0.00 0.00 0.00 0.00 447.72
5[iii] Provisions 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 685.02 685.02
5[iv] Others 0.00 0.00 0.00 0.00 334.10 0.00 0.00 44.95 0.00 275.19 654.24
6 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
7 Unavailed Cash Credit/over drafts 94.27 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 94.27
8 Letter of Credit& Guarantees 34.32 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 34.32
9 Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Bills Rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.Swaps 166.90 417.40 3.10 3.90 565.40 987.90 2.30 0.00 0.00 0.00 2146.90
12. Interest Payable 1.27 5.59 7.28 13.71 54.85 70.00 164.14 87.05 10.44 2.41 416.74
13. Event cash outflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-Total outflows 886.74 1046.40 781.35 431.79 3014.39 3052.92 8069.09 19540.22 2310.51 39267.95 78401.36
INFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1.Cash 548.37 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 548.37
2.Balance with RBI 1316.60 0.00 0.00 118.00 127.07 127.80 427.72 1090.70 145.56 1954.55 5308.00
3[I]. Balance with Banks- Current
Deposits 549.25 0.00 0.00 0.00 0.00 0.00 0.00 0.73 0.00 0.00 549.98
3[ii] Balance with Banks-Call &
Term 0.00 499.67 0.00 0.00 150.00 0.00 0.00 0.00 0.00 0.00 649.67
4. Investments 0.00 248.00 0.00 709.60 655.20 498.80 512.30 1873.40 4606.30 13790.51 22894.11
5[I] Advances- Bills Purchased&
Discounted 112.48 62.89 222.95 280.19 45.96 0.00 0.00 0.00 0.00 0.00 724.47
5[ii] Advances- Cash CreditOver 369.41 240.07 1318.01 752.23 2027.84 3032.55 3954.31 12193.34 37.65 23.76 23949.17

233
Drafts
5[iii] Advances- Term Loans 3.43 30.31 41.21 165.77 593.34 879.86 1890.25 5736.92 5115.62 4926.97 19383.68
6 NPA Advances& Investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 740.65 740.65
7 Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 392.45 392.45
8[I] Inter Office adjustments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[ii] Leased assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[iii] Other Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 670.08 670.08
9. Reverse Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Swaps 165.90 612.40 0.00 2.50 1071.70 1093.60 0.00 0.00 0.00 0.00 2946.10
11 Bills rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12 Interest receivable 24.69 2.00 14.50 106.60 125.40 151.50 1.95 0.00 0.00 17.19 443.83
13 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14 ExportRefinance from RBI 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
15. Event cash inflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
B-Total inflows 3090.13 1695.34 1596.67 2134.89 4796.51 5784.11 6786.53 20895.09 9905.13 22516.16 79200.56
C-Mismatch [B-A] 2203.39 648.94 815.32 1703.10 1782.12 2731.19 -1282.56 1354.87 7594.62 -16751.79 799.20
D. CumulativeMis- match 2203.39 2852.33 3667.65 5370.75 7152.87 9884.06 8601.50 9956.37 17550.99 799.20 799.20
394.43
E. C as % to A 248.48% 62.02% 104.35% % 59.12% 89.46% -15.89% 6.93% 328.70% -42.66% 1.02%

The following table sets forth our asset - liability as on March 31, 2011
(` in million)
OUTFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1. Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 313.48 313.48
2. Reserves& Surplus 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4451.58 4451.58
3[i] Current Deposit 135.05 250.84 354.46 0.00 0.00 0.00 0.00 2487.09 0.00 41.55 3268.99
3[ii] Savings Deposit 45.48 120.19 168.92 0.00 0.00 0.00 0.00 15907.87 0.00 0.00 16242.46
3[iii] Term Deposit. 78.94 550.98 1603.28 1167.33 3940.03 5813.96 4921.75 5373.27 954.89 43340.81 67745.24
3[iv] Certificate of Deposit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[I] Borrowing 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[ii]Inter-Bank Term 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[iii]Refinances 0.00 250.00 0.00 0.00 0.09 128.25 628.34 420.95 109.42 0.00 1537.05
4[iv] Others 0.00 784.14 0.00 0.00 0.00 0.00 0.00 260.00 657.00 0.00 1701.14
5 [I] Bills Payable 30.40 77.80 110.03 0.00 0.00 0.00 0.00 49.12 0.00 0.00 267.35
5[ii] Inter-office Adjustment 292.80 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 292.80
5[iii] Provisions 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 708.24 708.24
5[iv] Others 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 656.00 656.00
6 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
7 Unavailed Cash Credit/over drafts 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

234
8 Letter of Credit & Guarantees 2.89 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2.89
9 Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Bills Rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.Swaps 84.00 345.40 0.20 23.70 1463.80 644.80 226.00 0.00 0.00 0.00 2787.90
12. Interest Payable 0.99 6.50 12.88 13.59 60.57 63.95 87.42 145.71 12.35 8.35 412.31
13. Event cash outflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-Total outflows 670.55 2385.85 2249.77 1204.62 5464.49 6650.96 5863.51 24644.01 1733.66 49520.01 100387.43
INFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1.Cash 597.37 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 597.37
2.Balance with RBI 195.04 0.00 0.00 215.00 243.00 339.00 315.00 1375.00 81.00 2511.00 5274.04
3[I]. Balance with Banks- Current
Deposits 584.48 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 584.48
3[ii] Balance with Banks-Call &
Term 0.00 0.00 0.00 515.00 30.00 0.00 0.00 0.00 0.00 0.00 545.00
4. Investments 0.00 1250.20 248.70 1492.50 491.50 2.00 15.10 3130.00 5520.40 14752.18 26902.58
5[I] Advances- Bills Purchased &
Discounted 83.00 35.00 147.00 601.00 104.00 0.00 0.00 0.00 0.00 0.00 970.00
5[ii] Advances - Cash CreditOver
Drafts 791.00 511.00 649.00 378.00 2195.00 5053.00 6298.00 18974.00 65.00 21.00 34935.00
5[iii] Advances - Term Loans 4.00 39.00 48.00 93.00 660.00 1147.00 2493.14 8562.00 6665.00 5470.00 25181.14
6 NPA Advances& Investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 734.00 383.00 1117.00
7 Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 357.91 357.91
8[I] Inter Office adjustments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[ii] Leased assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[iii] Other Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 654.02 654.02
9. Reverse Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Swaps 81.00 580.00 1.00 50.00 1461.00 749.00 231.00 0.00 0.00 0.00 3153.00
11 Bills rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12 Interest receivable 0.00 3.00 16.00 109.00 170.00 112.99 7.00 17.00 0.00 46.00 480.99
13 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14 ExportRefinance from RBI 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
15. Event cash inflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
B-Total inflows 2335.89 2418.20 1109.70 3453.50 5354.50 7402.99 9359.24 32058.00 13065.40 24195.11 100752.53
C-Mismatch [B-A] 1665.34 32.35 -1140.07 2248.88 -109.99 752.03 3495.73 7413.99 11331.74 -25324.90 365.10
D. CumulativeMis- match 1665.34 1697.69 557.62 2806.50 2696.51 3448.54 6944.27 14358.26 25690.00 365.10 365.10
186.69
E. C as % to A 248.35% 1.36% -50.67% % -2.01% 11.31% 59.62% 30.08% 653.63% -51.14% 0.36%

The following table sets forth our asset - liability as on March 31, 2012

235
 (` in million)
OUTFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1. Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 314.16 314.16
2. Reserves& Surplus 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4635.58 4635.58
3[i] Current Deposit 122.30 188.40 266.30 0.00 0.00 0.00 0.00 2859.40 0.00 42.19 3478.59
3[ii] Savings Deposit 49.30 130.90 185.40 0.00 0.00 0.00 0.00 16639.37 0.00 0.00 17004.97
3[iii] Term Deposit. 101.30 349.40 426.10 2155.30 4578.80 8557.40 8360.30 7353.60 1175.80 52507.14 85565.14
3[iv] Certificate of Deposit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[I] Borrowing 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[ii]Inter-Bank Term 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[iii]Refinances 0.00 230.00 0.00 0.00 0.00 128.08 128.20 1146.60 36.50 0.00 1669.38
4[iv] Others 0.00 0.27 0.00 0.00 0.00 0.00 0.00 260.00 657.00 418.00 1335.27
5 [I] Bills Payable 16.40 43.40 61.40 0.00 0.00 0.00 0.00 25.52 0.00 0.00 146.72
5[ii] Inter-office Adjustment 286.40 0.00 0.00 0.00 10.00 3.40 0.00 0.00 0.00 0.00 299.80
5[iii] Provisions 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 869.34 869.34
5[iv] Others 0.00 0.00 0.00 0.00 780.50 0.00 0.00 323.09 0.00 0.00 1103.59
6 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
7 Unavailed Cash Credit/over drafts 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8 Letter of Credit & Guarantees 5.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5.50
9 Repos 0.00 2750.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2750.00
10. Bills Rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.Swaps 21.10 302.20 27.50 141.30 1512.50 652.50 117.50 0.00 0.00 0.00 2774.60
12. Interest Payable 1.30 5.60 6.20 20.10 142.10 135.60 134.30 110.00 14.60 11.73 581.53
13. Event cash outflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-Total outflows 603.60 4000.17 972.90 2316.70 7023.90 9476.98 8740.30 28717.58 1883.90 58798.14 122534.17
INFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1.Cash 661.02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 661.02
2.Balance with RBI 1306.54 0.00 0.00 121.80 286.00 386.50 410.40 1245.60 76.00 2370.90 6203.74
3[I]. Balance with Banks- Current
Deposits 520.35 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 520.35
3[ii] Balance with Banks-Call &
Term 0.00 750.00 0.00 515.00 1030.00 30.00 0.00 0.00 0.00 0.00 2325.00
4. Investments 0.00 889.70 681.80 490.00 588.50 659.00 218.70 4085.40 3500.80 20337.56 31451.46
5[I] Advances- Bills Purchased &
Discounted 123.80 75.70 287.80 1026.10 103.20 0.00 0.00 0.00 0.00 0.00 1616.60
5[ii] Advances - Cash CreditOver
Drafts 1549.60 1126.40 1364.10 1457.00 3845.40 6432.30 10397.80 24153.50 54.33 39.00 50419.43
5[iii] Advances - Term Loans 5.30 38.10 54.20 94.90 647.30 1048.10 3217.10 8965.90 5717.60 3946.90 23735.40
6 NPA Advances& Investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 444.00 425.50 869.50

236
7 Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 371.12 371.12
8[I] Inter Office adjustments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[ii] Leased assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[iii] Other Assets 15.40 0.00 0.00 0.00 5.20 0.00 0.00 389.10 0.00 470.07 879.77
9. Reverse Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Swaps 0.00 470.30 0.00 0.00 2361.90 755.40 174.60 0.00 0.00 0.00 3762.20
11 Bills rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12 Interest receivable 2.30 21.10 115.60 124.50 202.50 125.30 6.80 18.30 0.00 89.78 706.18
13 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14 ExportRefinance from RBI 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
15. Event cash inflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
B-Total inflows 4184.31 3371.30 2503.50 3829.30 9070.00 9436.60 14425.40 38857.80 9792.73 28050.83 123521.77
C-Mismatch [B-A] 3580.71 -628.87 1530.60 1512.60 2046.10 -40.38 5685.10 10140.22 7908.83 -30747.31 987.60
D. CumulativeMis- match 3580.71 2951.84 4482.44 5995.04 8041.14 8000.76 13685.86 23826.08 31734.91 987.60 987.60
E. C as % to A 593.23% -15.72% 157.32% 65.29% 29.13% -0.43% 65.04% 35.31% 419.81% -52.29% 0.81%

The following table sets forth our asset - liability as on March 31, 2013
(` in million)
OUTFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1. Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 418.99 418.99
2. Reserves& Surplus 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5380.75 5380.75
3[i] Current Deposit 149.70 208.40 294.80 0.00 0.00 0.00 0.00 2593.36 0.00 47.29 3293.55
3[ii] Savings Deposit 49.50 130.20 183.40 0.00 0.00 0.00 0.00 17977.30 0.00 0.00 18340.40
3[iii] Term Deposit. 270.10 678.40 582.00 2006.00 4236.80 8219.60 12491.20 11218.60 1914.90 60164.71 101782.31
3[iv] Certificate of Deposit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[I] Borrowing 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[ii]Inter-Bank Term 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[iii]Refinances 0.00 0.00 0.00 0.00 0.00 128.16 36.50 654.40 0.00 0.00 819.06
4[iv] Others 0.00 0.00 0.00 0.00 0.00 0.00 0.00 757.00 0.00 418.00 1175.00
5 [I] Bills Payable 23.00 60.90 86.20 0.00 0.00 0.00 0.00 13.54 0.00 0.00 183.64
5[ii] Inter-office Adjustment 141.90 0.00 0.00 0.00 3.14 0.00 0.00 0.00 0.00 0.00 145.04
5[iii] Provisions 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1099.97 1099.97
5[iv] Others 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1298.61 1298.61
6 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
7 Unavailed Cash Credit/over drafts 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8 Letter of Credit & Guarantees 4.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4.50
9 Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Bills Rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.Swaps 0.00 635.90 0.90 53.60 951.80 584.40 66.60 0.00 0.00 0.00 2293.20

237
12. Interest Payable 2.40 8.30 8.20 19.20 54.60 92.10 152.80 190.50 11.82 9.10 549.02
13. Event cash outflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-Total outflows 641.10 1722.10 1155.50 2078.80 5246.34 9024.26 12747.10 33404.70 1926.72 68837.42 136784.04

INFLOWS Next 2-7 days 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days <3M <6M
1.Cash 846.80 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 846.80
2.Balance with RBI 681.30 0.00 0.00 122.30 236.90 356.70 483.50 1220.08 93.20 2251.80 5445.78
3[I]. Balance with Banks- Current
Deposits 532.61 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 532.61
3[ii] Balance with Banks-Call &
Term 0.00 0.00 250.00 765.00 2780.00 30.00 0.00 0.00 0.00 0.00 3825.00
4. Investments 0.00 0.00 497.10 0.00 1425.00 100.30 224.70 5135.30 2610.00 23018.12 33010.52
5[I] Advances- Bills Purchased &
Discounted 671.70 158.50 513.20 1113.30 0.00 0.00 0.00 0.00 0.00 0.00 2456.70
5[ii] Advances - Cash CreditOver 12600.8
Drafts 234.60 1099.60 1538.90 1097.20 6134.00 0 13655.80 27323.60 16.50 55.38 63756.38
5[iii] Advances - Term Loans 4.20 30.40 43.80 73.10 465.30 773.50 2105.10 9035.40 4610.70 4145.80 21287.30
6 NPA Advances& Investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 564.50 454.80 1019.30
7 Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 427.46 427.46
8[I] Inter Office adjustments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[ii] Leased assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[iii] Other Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1169.31 1169.31
9. Reverse Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Swaps 0.00 708.00 0.00 1.10 1415.40 760.10 116.30 0.00 0.00 0.00 3000.90
11 Bills rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12 Interest receivable 0.00 3.60 16.40 115.90 406.50 171.28 0.00 0.00 0.00 0.00 713.68
13 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14 ExportRefinance from RBI 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
15. Event cash inflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14792.6
B-Total inflows 2971.21 2000.10 2859.40 3287.90 12863.10 8 16585.40 42714.38 7894.90 31522.67 137491.74
C-Mismatch [B-A] 2330.11 278.00 1703.90 1209.10 7616.76 5768.42 3838.30 9309.68 5968.18 -37314.75 707.70
18906.2
D. CumulativeMis- match 2330.11 2608.11 4312.01 5521.11 13137.87 9 22744.59 32054.27 38022.45 707.70 707.70
E. C as % to A 363.45% 16.14% 147.46% 58.16% 145.18% 63.92% 30.11% 27.87% 309.76% -54.21% 0.52%

The following table sets forth our asset - liability as on March 31, 2014
(` in million)
Outflows Next Day 2-7 days 8-14 days 15-28 days 29d-<3M 3M-<6M 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total

238
1. Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 418.99 418.99
2. Reserves& Surplus 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5779.61 5779.61
3[i] Current Deposit 196.27 265.29 375.07 0.00 0.00 0.00 0.00 2428.05 0.00 49.77 3314.45
3[ii] Savings Deposit 62.92 168.45 237.46 0.00 0.00 0.00 0.00 19826.55 0.00 0.00 20295.38
3[iii] Term Deposit. 187.40 481.23 1013.44 1827.60 6444.53 9553.98 11039.68 8784.36 3583.96 70212.60 113128.78
3[iv] Certificate of Deposit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[I] Borrowing 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[ii]Inter-Bank Term 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[iii]Refinances 0.00 0.00 0.00 0.00 0.00 977.48 126.48 36.47 0.00 0.00 1140.43
4[iv] Others 0.00 200.00 0.00 400.00 100.00 0.00 157.00 0.00 418.00 0.00 1275.00
5 [I] Bills Payable 19.29 51.06 77.48 0.00 0.00 0.00 0.00 0.00 0.00 0.00 147.83
5[ii] Inter-office Adjustment 212.95 0.00 0.00 0.00 4.66 0.00 0.00 0.00 0.00 0.00 217.61
5[iii] Provisions 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 974.47 974.47
5[iv] Others 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1180.20 1180.20
6 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
7 Unavailed Cash Credit/over drafts 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8 Letter of Credit & Guarantees 12.08 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 12.08
9 Repos 0.00 3140.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 3140.00
10. Bills Rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.Swaps 0.00 2496.40 0.00 119.00 1141.80 81.50 19.40 69.20 74.20 0.00 4001.50
12. Interest Payable 2.57 8.84 12.74 25.22 82.17 139.57 183.96 159.48 16.17 10.35 641.07
13. Event cash outflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-Total outflows 693.48 6811.27 1716.19 2371.82 7773.16 10752.53 11526.52 31304.11 4092.33 78625.99 155667.40

INFLOWS Next 2-7 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days days <3M <6M
1.Cash 720.21 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 720.21
2.Balance with RBI 202.72 0.00 0.00 147.33 271.28 384.29 467.17 1266.80 164.99 2614.24 5518.82
3[I]. Balance with Banks- Current Deposits 106.55 890.00 0.00 0.00 0.00 0.00 0.00 0.70 0.00 6.24 1003.49
3[ii] Balance with Banks-Call & Term 0.00 0.50 500.00 500.00 2500.00 0.00 0.00 0.00 0.00 0.00 3500.50
10611.9
4. Investments 0.00 486.10 0.00 2472.40 2086.90 5401.90 4733.30 3415.40 0 22108.63 51316.53
5[I] Advances- Bills Purchased &
Discounted 13.21 184.04 347.70 719.65 2937.54 512.00 0.00 0.00 0.00 0.00 4714.14
17108.4 30327.8
5[ii] Advances - Cash CreditOver Drafts 213.53 850.10 1107.35 823.08 4138.31 5616.44 9 2 39.15 54.18 60278.45
5[iii] Advances - Term Loans 3.03 24.38 32.85 59.31 391.11 674.08 1715.22 6396.93 4451.45 6386.71 20135.07
6 NPA Advances& Investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 919.44 1038.60 1958.04
7 Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 483.34 483.34
8[I] Inter Office adjustments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

239
8[ii] Leased assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[iii] Other Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 860.52 860.52
9. Reverse Repos 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
10. Swaps 0.00 2530.20 0.00 172.40 1506.70 125.20 0.00 0.00 0.00 0.00 4334.50
11 Bills rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12 Interest receivable 0.00 52.10 84.40 196.60 416.17 260.60 64.21 18.17 0.00 84.54 1176.79
13 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14 ExportRefinance from RBI 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
15. Event cash inflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14248.0 12974.5 24088.3 41425.8 16186.9 156000.4
B-Total inflows 1259.25 5017.42 2072.30 5090.77 1 1 9 2 3 33637.00 0
- 12561.8 10121.7 12094.6 -
C-Mismatch [B-A] 565.77 1793.85 356.11 2718.95 6474.85 2221.98 7 1 0 44988.99 333.00
- 10543.8 23105.6 33227.3 45321.9
D. CumulativeMis- match 565.77 1228.08 -871.97 1846.98 8321.83 1 8 9 9 333.00 333.00
- 108.98 295.54
E. C as % to A 81.58% 26.34% 20.75% 114.64% 83.30% 20.66% % 32.33% % -57.22% 0.21%

The following table sets forth our asset - liability as on September 30, 2014
(` in million)
Outflow Next 2-7 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days days <3M <6M
1. Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 418.99 418.99
2. Reserves& Surplus 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5140.36 5140.36
3[i] Current Deposit 195.20 266.80 377.30 0.00 0.00 0.00 0.00 3055.73 0.00 0.00 3895.03
21102.8
3[ii] Savings Deposit 60.30 161.70 228.50 0.00 0.00 0.00 0.00 8 0.00 0.00 21553.38
11047.5 116206.6
3[iii] Term Deposit. 163.00 383.30 829.30 2026.20 7230.60 8854.90 0 8729.40 3430.70 73511.71 1
3[iv] Certificate of Deposit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[I] Borrowing 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[ii]Inter-Bank Term 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
4[iii]Refinances 90.00 0.00 0.00 0.00 0.00 36.50 36.45 0.00 0.00 0.00 162.95
4[iv] Others 0.00 0.00 0.00 0.00 157.00 0.00 0.00 0.00 418.00 0.00 575.00
5 [I] Bills Payable 23.50 62.10 64.79 0.00 0.00 0.00 0.00 0.00 0.00 0.00 150.39
5[ii] Inter-office Adjustment 214.55 0.00 0.00 0.00 11.20 0.00 0.00 0.00 0.00 0.00 225.75
5[iii] Provisions 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 966.30 966.30
5[iv] Others 921.00 2.10 0.00 0.00 0.00 0.00 0.00 1.90 33.20 0.53 958.73
6 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
7 Unavailed Cash Credit/over drafts 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8 Letter of Credit & Guarantees 70.70 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 70.70

240
9 Repos 1090.00 1250.00 2250.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 4590.00
10. Bills Rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
11.Swaps 433.70 59.80 0.00 46.80 1263.70 247.50 320.70 69.20 74.20 0.00 2515.60
12. Interest Payable 2.50 8.40 10.80 23.90 98.90 115.60 218.40 144.50 15.60 12.19 650.79
13. Event cash outflows 75.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 75.90
11623.0 33103.6 158156.4
A-Total outflows 3340.35 2194.20 3760.69 2096.90 8761.40 9254.50 5 1 3971.70 80050.08 8
INFLOWS Next 2-7 8-14 15-28 29d- 3M- 6M-<1Y 1-<3Y 3-<5 Y > 5 Yr Total
Day days days days <3M <6M
1.Cash 904.26 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 904.26
2.Balance with RBI 0.00 0.00 0.00 127.00 286.90 348.00 438.00 1254.40 151.40 2789.16 5394.86
3[I]. Balance with Banks- Current Deposits 119.30 504.85 0.00 0.00 0.00 0.00 0.00 0.70 0.00 7.38 632.23
3[ii] Balance with Banks-Call & Term 0.00 359.00 200.42 0.00 135.00 0.00 0.00 0.00 0.00 0.00 694.42
4. Investments 500.00 2557.30 4262.00 3243.50 135.90 514.00 3620.20 624.30 180.90 33291.81 48929.91
5[I] Advances- Bills Purchased &
Discounted 0.00 303.00 530.20 1136.10 4695.80 908.90 0.00 0.00 0.00 0.00 7574.00
20157.6 30056.4
5[ii] Advances - Cash CreditOver Drafts 299.90 978.80 1325.30 620.20 3020.60 6251.60 0 0 44.90 58.90 62814.20
5[iii] Advances - Term Loans 3.20 29.60 38.20 103.20 480.40 756.00 1624.80 6733.80 4574.00 6073.63 20416.83
6 NPA Advances& Investments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2388.10 1180.60 3568.70
7 Fixed Assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 474.50 474.50
8[I] Inter Office adjustments 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[ii] Leased assets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
8[iii] Other Assets 0.00 4.70 0.00 0.00 49.20 0.00 0.00 299.60 0.00 517.91 871.41
9. Reverse Repos 2400.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2400.00
10. Swaps 243.20 169.20 0.00 26.70 1757.60 371.40 322.60 0.00 0.00 0.00 2890.70
11 Bills rediscounted 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
12 Interest receivable 1.00 35.00 100.40 83.10 403.60 189.30 27.70 18.10 0.00 31.46 889.66
13 Lines of Credit 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
14 ExportRefinance from RBI 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
15. Event cash inflows 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 75.90 75.90
10965.0 26190.9 38987.3 158531.5
B-Total inflows 4470.86 4941.45 6456.52 5339.80 0 9339.20 0 0 7339.30 44501.25 8
14567.8 -
C-Mismatch [B-A] 1130.51 2747.25 2695.83 3242.90 2203.60 84.70 5 5883.69 3367.60 35548.83 375.10
12020.0 12104.7 26672.6 32556.3 35923.9
D. CumulativeMis- match 1130.51 3877.76 6573.59 9816.49 9 9 4 3 3 375.10 375.10
125.21 125.34
E. C as % to A 33.84% % 71.68% 154.65% 25.15% 0.92% % 17.77% 84.79% -44.41% 0.24%

Note to ALM – Slotting Criteria for Daily Structural Liquidity Statement

Heads of Account Criteria for Slotting

241
A. OUTFLOWS
1. Capital Over 5 year time bucket
2. Reserves& Surplus Over 5 year time bucket
3. Deposits
3[i] Current Deposits Volatile portion of current deposits (other than overdue term deposits) in first 3 time buckets and core portion in 1-3 year bucket.

Volatility to be estimated based on empirical study covering daily data of 1 year.1 day volatility to be equated to the standard deviation of the daily
percentage changes observed over the 1 year period. Assuming normal distribution, 7 day and 14 day volatility is to be arrived at by multiplying the 1
day standard deviation % with square root of 7 and square root of 14 respectively.

Overdue term deposits should be separately analysed to find out the core and volatile portions. The composition of the overdue term deposit portfolio as
on two dates should be analysed to gauge the percentage that is getting renewed (i.e. volatile) and the percentage that remains as overdue (i.e. core).
Slotting should be based on the results of the study.
3[ii] Savings Deposits Volatile portion in first 3 time buckets and core portion in 1-3 year bucket.

Volatility to be estimated based on empirical study covering daily data of 1 year.1 day volatility to be equated to the standard deviation of the daily
percentage changes observed over the 1 year period. Assuming normal distribution, 7 day and 14 day volatility is to be arrived at by multiplying the 1
day standard deviation % with square root of 7 and square root of 14 respectively.
3[iii] Term Deposits Wholesale Deposits
Deposits of ` 1 crore and above are to be treated as wholesale and slotted in respective time buckets based on residual maturity, adjusted for premature
withdrawal. Retail Deposits-Deposits less than ` 1 croreare to be treated as retail. Behavioural maturity should be arrived at based on renewal pattern
and premature withdrawal pattern estimated empirically.
Retail Deposits
Deposits less than ` 1 crore are to be treated as retail. Behavioural maturity should be arrived at based on renewal pattern and premature withdrawal
pattern estimated empirically.
4 Borrowings Respective maturity buckets.
5 Other Liabilities
5 [I] Bills Payable Volatile portion in first 3 time buckets and core portion in 1-3 year bucket.

Volatility to be estimated based on empirical study covering daily data of 1 year.1 day volatility to be equated to the standard deviation of the daily
percentage changes observed over the 1 year period. Assuming normal distribution, 7 day and 14 day volatility is to be arrived at by multiplying the 1
day standard deviation % with square root of 7 and square root of 14 respectively.
5[ii] Inter-office Based on empirical study
Adjustments
5[iii] Provisions Above 5 years
5[iv] Others Respective time buckets.
6 Unavailed Cash Estimated Amount of unavailedcashcredits/overdrafts (arrived at based on empirical studies) to be placed in first time bucket.
Credits/Overdrafts
7 Letter of Credit & Incidence of devolvement to be estimated based on empirical studies and the likely devolvement to be placed in first time bucket.
Guarantees
8 Export Credit Refinance Respective maturity bucket of underlying assets
Availed
9 Others Respective time buckets.

242
B.INFLOWS
1.Cash Day 1 bucket
2.Balance with RBI Excess balance over the required CRR in Day 1 bucket, Statutory balances distributed among various time buckets corresponding to maturity profile of
Demand & Time Liabilities with a time lag of 14 days.
3. Balance with Banks
3[I]. Bal Banks – CD Non withdrawable portion on account of minimum balance stipulation shown in Over 1-3 years bucket and remaining balance in Day 1 bucket.
3[ii] Do- Call & Term Respective maturity buckets
4 Investments* Contractual residual maturity buckets.
5 Loans & Advances
5[I] Bills Purchased & Respective Maturity Buckets
Discounted
5[ii] Cash Credits, Volatile portion in first 3 time buckets and core portion in 1-3 year bucket.
Overdrafts, Packing
Credit & Other WC limits Volatility to be estimated based on empirical study covering daily data of 1 year.1 day volatility to be equated to the standard deviation of the daily
percentage changes observed over the 1 year period. Assuming normal distribution, 7 day and 14 day volatility is to be arrived at by multiplying the 1
day standard deviation % with square root of 7 and square root of 14 respectively.
5[iii] Term Loans Respective maturity buckets
6 NPA Advances & Substandard: 3-5 year bucket, Doubtful & Loss: Above 5 year bucket
Investments
7 Fixed Assets Over 5 years
8 Other Assets Respective maturity buckets. Intangible assets and assets not representing cash receivables in Over 5 year time bucket.

* For internal MIS purpose investments are classified as i) SLR Securities HTM-In over 5 year bucket. ii) Treasury Bills- Treasury Bills needed to meet SLR to be put in ‘Over 5
year bucket’. Rest of the Treasury Bills are assumed to be available to meet the liquidity requirements in periods upto 3 months, with the bulk of these placed in Day 1 time
bucket.iii) Shares-50% in 2-7 days time bucket and 50% deducted from Reserves & Surplus (Haircut portion as per RBI guidelines) iv) Mutual Funds/Certificate of Deposits-
Assumed to be available to meet the liquidity requirements in periods upto 3 months. v) Long Dated securities in Trading Book (AFS & HFT category)- Assumed to be available
to meet the liquidity requirements in periods upto 3 months subject to a haircut of 1% vi) All Others- Respective Maturity Buckets

Following table sets forth, as of September 30 2014, an analysis of the residual maturity profile of our investments in coupon-bearing securities.
The amounts indicate the book value (i.e. the acquisition cost) of the securities and are gross of depreciation.

RESIDUAL MATURITY OF COUPON BEARING SECURITIES AS ON 30TH SEPTEMBER 2014**

` In million
Next 2-7 8 - 14 15-28 29 d - 3 3 M- 6 M- 1 5-7 7 - 10 10 - >15
1-3 Yr 3-5 Yr Total
Day days days days M 6M Y Yr yrs 15 yrs yrs*
i. Approved Securities: 0 0 0 0 313.90 0 949.77 3196.4 7398.17 3212.5 7771.64 6706.3 3790.91 33339.59
Government Securities
(Central & State) Treasury
Bills & Other Approved
Securities(including NonSLR
SGS ` 171.20 mio 10-15
bucket) 0 0 0 0 313.90 0 949.77 3196.4 7398.17 3212.5 7771.64 6706.3 3790.91 33339.59

243
ii. Other Debt Securities: 0 0 10.00 0 0 0 110.00 60.91 1276.23 400 69.87 0 40.00 1967.01
Corporate debts & bonds PSU
bonds, Call Deposits,
Commercial Papers
&Certificate of Deposits 0 0 10 0 0 0 110.00 60.91 1276.23 400 69.87 0 40.00 1967.01
Security Receipts
Preference Shares,Equity
Shares 7.82
TOTAL COUPON 1059.7
BEARING SECURITIES 0 0 10 0 313.9 0 7 3265.13 8674.4 3612.5 7841.51 6706.3 3830.91 35314.42
TOTAL MARKET VALUE
OF COUPON BEARING 1042.1 3459.5 6324.9
SECURITIES 0 0 9.99 313.23 0 8 3154.07 8240.6 3 7531.18 5 3375.1 33450.83

*
Including NPA investments of Bharathi Shipyard ` 40.00 million in the more than 15 year bucket
**
Reverse Repo ` 2400 million not included in the above investments
Key Financial Information
The performance of the Bank over last five years and for half year ended September 30, 2014 is summarized in the following table:
(` in million)
Net Divi
Profit/(Net dend No. of No. of
Year Networth Deposits Net Advances Total Income Loss) Paid (%) Branches* Employees #
2009-10 3021.99 69,783.50 44,669.38 6,519.03 (61.88) Nil 364 2696
2010-11 4765.06 87,256.69 62,200.25 8,365.74 199.73 10.00% 364 2820
2011-12 4949.74 106,048.70 76,635.43 11,607.95 260.44 15.00% 372 2729
2012-13 5799.74 123,416.26 88,515.18 14,154.29 266.17 15.00% 390 2882
2013-14 6198.60 136,738.61 87,073.62 16,212.96 309.46 10.00% 430 2896
HYE Sep 2014 5559.35 141,655.02 94,303.03 8,162.74 (181.47) 431 3108
Nil
* Including Service branches
# Including Permanent part-time employees

Demographic Network of Branches

Demographic network of branches as on March 31, 2014, September, 2014, is stated as under:

244
 No. of Branches
Type 31-Mar-14 30-Sep-14
Metro 55 55
Rural 48 49
Semi Urban 225 225
Urban 102 102
Total 430 431

State Wise Distribution of Branches

Geographical distribution of the branches of the Bank as on March 31, 2014 and September 30, 2014 is given as under:

March 31,2014 September 30,2014

State/Union Territory No of Branches* No of ATMs No of Branches* No of ATMs
Andhara Pradesh 9 3 9 3
Chandigarh 1 1 1 1
Dadra Nagar Haveli 2 2 2 2
Delhi 5 4 5 4
Goa 2 2 2 2
Gujarat 6 4 6 5
Haryana 2 2 2 2
Himachal Pradesh 1 1 1 1
Karnataka 16 9 16 10
Kerala 281 108 282 112
Madhya Pradesh 1 1 1 1
Maharashtra 30 26 30 26
Orissa 1 1 1 1
Pondicherry 1 1 1 1
Punjab 3 3 3 3
Rajasthan 4 4 4 4
Tamil Nadu 58 46 58 46
Uttar Pradesh 4 4 4 4
West Bengal 3 2 3 2
TOTAL 430 230 431 232
* Including Service branches

245
State Wise Distribution of Business (Deposit & Advances)

State-wise break-up of the spread of branches and business in terms of deposits and advances as of March 31, 2010, 2011, 2012, 2013, 2014 and September 30, 2014, is stated as
under:
(Amount in Millions except for branch numbers)
March 31,2010 March 31,2011 March 31,2012
State No. ofBranches Deposit Advance No. of Branches Deposit Advance No. ofBranches Deposit Advance
Andhra Pradesh 9 1086.19 1368.36 9 1534.10 1420.69 9 1477.70 1694.01
Chandigarh 1 156.64 1288.35 1 205.40 1682.06 1 327.81 1790.80
Dadra and Nagar Haveli 0 0.00 0.00 0 0.00 0.00 0 0.00 0.00
Delhi 4 1996.98 1125.48 4 2598.10 1412.34 4 3496.32 1491.38
Goa 2 559.78 145.07 2 682.74 198.11 2 1177.71 276.54
Gujarat 4 441.95 245.23 4 545.95 336.75 4 627.77 379.48
Haryana 2 244.65 244.12 2 281.15 327.88 2 525.79 535.17
Himachal Pradesh 0 0.00 0.00 0 0.00 0.00 0 0.00 0.00
Karnataka 15 2675.80 1733.64 15 4275.43 2438.60 15 6435.79 3462.40
Kerala 240 43871.61 18776.28 240 52824.88 25096.88 242 64317.63 32455.02
Madhya Pradesh 0 0.00 0.00 0 0.00 0.00 0 0.00 0.00
Maharashtra 23 6840.96 5619.75 23 9954.49 8576.83 23 11159.90 8486.25
Orissa 1 96.41 125.41 1 110.12 168.28 1 156.77 179.54
Pondicherry 1 220.36 179.59 1 273.27 275.13 1 281.46 748.51
Punjab 3 291.26 198.08 3 424.26 646.02 3 532.56 671.62
Rajasthan 1 106.72 546.63 1 178.43 1184.18 2 232.76 1718.05
Tamilnadu 49 10702.44 13486.31 49 12648.64 18843.40 53 14330.02 23254.01
Uttar Pradesh 1 83.17 164.75 1 119.55 171.58 2 175.85 214.34
West Bengal 3 408.58 198.03 3 600.18 246.75 3 792.86 319.78
Total 359 69783.50 45445.08 359 87256.69 63025.48 367 106048.70 77676.90

246
 (Amount in Millions except for branch numbers)
March 31,2013 March 31,2014 September 30,2014
No. of No. of No. of
State Deposit Advance Deposit Advance Deposit Advance
Branches Branches Branches
Andhra
Pradesh 9 1649.43 2181.05 9 1800.87 2192.38 9 1870.23 2155.18
Chandigarh 1 986.10 1623.18 1 946.63 1710.06 1 1063.00 1169.05
Dadra and
Nagar Haveli 2 10.21 31.37 2 40.10 53.90 2 51.11 88.43
Delhi 4 4222.63 1759.34 4 4859.72 957.36 4 4686.03 1425.84
Goa 2 1341.02 401.83 2 1255.03 380.06 2 1061.92 365.84
Gujarat 6 733.11 485.77 6 813.59 695.46 6 798.96 1356.07
Haryana 2 579.93 581.97 2 551.49 484.20 2 495.24 530.35
Himachal
Pradesh 1 34.21 3.62 1 47.18 4.76 1 54.82 14.57
Karnataka 15 7357.33 4764.13 16 7332.45 4851.30 16 7790.36 4990.14
Kerala 245 73229.96 35605.09 279 83825.79 34647.70 280 87306.33 37748.29
Madhya
Pradesh 1 20.54 1.23 1 120.12 11.50 1 168.06 24.56
Maharashtra 27 12761.10 8868.86 29 12539.47 9416.75 29 13173.95 8875.25
Orissa 1 259.69 210.69 1 274.03 268.44 1 225.99 241.70
Pondicherry 1 294.39 1347.05 1 341.12 1108.14 1 363.82 962.13
Punjab 3 665.64 635.22 3 1174.12 445.99 3 1459.94 538.62
Rajasthan 3 285.35 2044.00 4 506.93 1620.26 4 466.54 1660.25
Tamilnadu 55 17825.72 28625.28 57 18376.85 29080.57 57 19306.98 32997.88
Uttar Pradesh 4 298.35 221.09 4 922.00 244.20 4 443.70 499.25
West Bengal 3 861.55 368.94 3 1011.12 367.17 3 868.04 444.25
Total 385 123416.26 89759.71 425 136738.61 88540.20 426 141655.02 96087.65

247
 FINANCIAL INDEBTEDNESS

As on December 31, 2014, our Bank had secured and unsecured borrowings, including borrowings from the RBI,
refinance assistance from NABARD and non-convertible debentures amounting to ` 4,102.86 million. Set forth
below is a brief summary of our outstanding financial arrangements as on December 31, 2014.

A. Secured borrowings of our Bank

As on December 31, 2014, our Bank had secured borrowings, consisting of short term repo borrowings from the
RBI, liquidity adjusted facility repo from the RBI and collateralized borrowing and lending obligation (“CBLO”)
borrowings amounting to ` 3,410.46 million. Such borrowings are secured by various government securities held by
us in our investment portfolio. For the regulatory framework governing term repo, liquidity adjusted facility repo
borrowings and CBLO borrowings by banks in India, see the section titled “Regulations and Policies” on page 149.

Set forth is a brief description of our secured borrowings as on December 31, 2014.

(All amounts in ` million, except percentages)

Sl. Nature of Borrowing Amount Amount Date of Coupon/ Security provided
No. sanctioned outstanding Maturity Yield
as on (%)
December
31, 2014
Term repo borrowings from the RBI
1. Term Repo (Issue reference 500.00 500.00 January 9, 2015 8.16% (i) 11.43% Government
2014/12361) Security 2015 (ISIN:
IN0020000090)

(ii) 6.90% Government

Stock 2019 (ISIN:
IN0020090042)

350.00 350.00 January 9, 2015 8.14% (i) 5.64% Government

Stock 2019 (ISIN:
IN002003097)

(ii) 7.49% Government

Stock 2017 (ISIN:
IN0020020031)

250.00 250.00 January 9, 2015 8.11% (i) 6.83% Government

Stock 2039 (ISIN:
IN0020080050)

(ii) 6.90% Government

Stock 2019 (ISIN:
IN0020090042)

2. Term Repo (Issue reference 300.00 300.00 January 13, 8.13% 6.05% Government
2014/12362) 2015 Stock 2019 (ISIN:
IN0020080068)

500.00 500.00 January 13, 8.16% 7.80% Government

2015 Stock 2020 (ISIN:
IN0020100015)

3. Term Repo (Issue reference 250.00 250.00 January 6, 2015 8.15% 7.38% Government
2014/12294) Security 2015 (ISIN:
IN0020020130)

500.00 500.00 January 6, 2015 8.16% (i) 5.64% Government

248
Sl. Nature of Borrowing Amount Amount Date of Coupon/ Security provided
No. sanctioned outstanding Maturity Yield
as on (%)
December
31, 2014
Stock 2019 (ISIN:
IN0020030097)

(ii) 7.80% Government

Stock 2020 (ISIN:
IN0020100015)

4. Term Repo (Issue reference 250.00 250.00 January 2, 2015 8.16% 7.80% Government
2014/12293) Stock 2020 (ISIN:
IN0020100015)
Liquidity adjusted facility repo from the RBI
1. Liquidity adjusted facility 340.00 340.00 January 1, 2015 8.00% 6.05% Government
Repo (Issue reference Stock 2019 (ISIN:
2014/12375) IN0020080068)
CBLO borrowings
1. CBLO issued on December 49.99 49.99 January 1, 2015 8.31% 6.05% Government
31, 2014 29.99 29.99 January 1, 2015 8.40% Stock 2019 (ISIN NO.
39.99 39.99 January 1, 2015 8.28% IN0020030048)
20.00 19.99 January 1, 2015 8.36%
30.49 30.49 January 1, 2015 8.50%

B. Unsecured borrowings of our Bank

As on December 31, 2014, our Bank has unsecured borrowings, consisting of subordinated non-convertible
debentures, export credit refinance assistance from the RBI and refinance assistance from NABARD amounting to `
692.40 million. For the regulatory framework governing export credit refinance borrowings by banks in India, see
the section titled “Regulations and Policies” on page 149.

Set forth is a brief description of our unsecured borrowings as on December 31, 2014.

(i) Non-convertible debentures

Set forth is a brief description of unsecured non-convertible debentures issued by us as on December 31, 2014.

(All amounts in ` million except percentages)

Sl. Nature of Borrowing Date of Deemed Amount Amount Date of Coupon (%)
No. allotment date of issued outstanding Maturity/
allotment as on Redemption
December
31, 2014
Non-convertible debentures
1. CSBL Bonds 2012 (Series – 1)(1) March 31, March 31, 418.00 418.00 March 30, 11.70%
2012 2012 2019
Deep discount bonds(2)
2. Deep discount bonds due January 12, December 0.37 0.37 January 12, 12.93%(3)
December 2028 2000 1, 1999 2029
3. Deep discount bonds due January 31, January 3, 0.48 0.48 January 30, 12.93%(3)
January 2029 2000 2000 2029
4. Deep discount bonds due April April 3, April 3, 0.60 0.60 April 2, 2029 12.93%(3)
2029 2000 2000
(1)
In the nature of unsecured redeemable lower Tier II subordinated non-convertible debentures of face value of ` 1 million each,
with coupons payable semi-annually and were allotted on private placement basis on March 31, 2012. These debentures are
listed on the wholesale debt market platform of the NSE.
(2)
In the nature of unsecured, redeemable, non-convertible subordinated debentures of face value of ` 150 each free of restrictive
clauses, issued on a private placement basis, with tenor of 29 years from the deemed date of allotment of the debentures, bearing

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a coupon rate of 12.93% compounded quarterly, payable along with the redemption proceeds.
(3)
The effective annual rate of return on these instruments is 13.57%.

Some of the significant conditions of the CSBL Bonds 2012 (Series – 1) are as follows:

(i) The CSBL Bonds 2012 (Series – 1) can be redeemed prior to their maturity upon the occurrence of an event
of default, if required by the debenture trustee, with prior approval of the RBI.

(ii) In terms of the debenture trust deed executed by our Bank in favour of Indian Overseas Bank, the trustee
for the holders of the CSBL Bonds 2012, our Bank cannot, without prior consent of trustee, declare
dividends in any financial year unless it has paid all dues to the holders of the CSBL Bonds 2012, or made
satisfactory provisions thereof.

(ii) Export credit re-finance

Set forth is a brief description of export credit re-finance assistance from the RBI availed by our Bank as on
December 31, 2014. For the regulatory framework governing export credit re-finance assistance taken by banks in
India, see the section titled “Regulations and Policies” on page 149.

(All amounts in ` million, except percentages)

Nature of Amount Date of Amount outstanding Date of Maturity Interest
Borrowing sanctioned availment as on December 31, (%)
2014
Export credit 250.00 October 13, 200.00 On demand, subject to a 8.00%**
*
refinance assistance 2014 maximum tenor extending till 180
from RBI days from the date of availment*
*
In terms of the RBI’s master circular on Export Credit Refinance Facility dated July 1, 2014 (“Master Circular on Export
Credit Refinance”).
**
In terms of the Master Circular on Export Credit Refinance, the export credit refinance facility is available at the Repo rate
applicable to LAF, which was 8% as on December 31, 2014.

(iii) Re-finance assistance from NABARD

Set forth is a brief description of re-finance assistance taken from NABARD availed by our Bank as on December
31, 2014.

(All amounts in ` million, except percentages)

Nature of Amount Year of Amount outstanding Repayment schedule Coupon
Borrowing sanctioned availment as on December 31, (%)
2014
Refinance 914.85 2010 72.95 Repayable in 10 bi-annual 8.25%
assistance from installments commencing on January
NABARD 31, 2011 and ending on July 31,
2015

In terms of the loan agreement dated January 22, 1979 and the Agricultural Refinance Corporation (subsequently
NABARD), NABARD may, in respect of refinance facilities obtained by our Bank from time to time, inter alia:

(i) Levy a pre-payment penalty of 1% on all sums pre-paid by our Bank to NABARD during the period from
the date of pre-payment till the actual date of repayment, or six months, whichever is longer, except where
such pre-payment is effected out of genuine recoveries by our Bank or if our Bank provides one month’s
prior notice of its intention to make such pre-payment prior to the due date for repayment of such sums; and

(ii) Charge commitment charges of 0.33% per annum over any part of the sanctioned refinance amount not
drawn by our Bank during any periods during which such drawal was to be made.

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 SECTION VI – LEGAL AND OTHER INFORMATION

OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS

Except as stated herein below, as at March 24, 2015, (i) there are no winding up petitions, outstanding litigations,
suits, criminal proceedings, civil proceedings, statutory or legal proceedings, including those for economic offences,
tax liabilities, show cause notices or legal notices pending against our Bank, Directors, or against any other company
whose outcome could have a materially adverse effect on the business, operations or financial position of our Bank,
and (ii) there are no defaults including non-payment or overdue of statutory dues, over-dues to banks or financial
institutions, defaults against banks or financial institutions or rollover or rescheduling of loans or any other liability,
defaults in dues payable to holders of any debentures, bonds and fixed deposits or arrears on cumulative preference
shares issued by our Bank, defaults in creation of full security as per the terms of issue or other liabilities,
proceedings initiated for economic, civil or any other offences (including past cases where penalties may or may not
have been awarded and irrespective of whether they are specified under paragraph (a) of Part I of Schedule V of the
Companies Act, 2013) other than unclaimed liabilities of our Bank except as stated below, and (iii) no disciplinary
action has been taken by SEBI or any stock exchange against our Bank or our Directors.

Further, (i) neither our Bank nor our Directors, have been declared as wilful defaulters by the RBI or any other
governmental authority and, (ii) there are no violations of securities laws committed by them or penalties imposed
on them there under in the past or pending against them, and no adverse findings regarding compliance with
securities laws. For details of entitities declared as wilful defaulters, with which our Directors are or have been
associated, see the section titled “Litigation involving the Directors of our Bank - Directors on the list of wilful
defaulters of the RBI” on page 329.

We have summarized information in relation to outstanding civil proceedings, including civil recovery proceedings
and consumer complaints, legal proceedings under the Negotiable Instruments Act, 1881 and notices which have
been received by our Bank. Details of civil proceedings or notices thereof, where the aggregate claim against us is,
or the potential financial implication is estimated to be ` 10 million or higher have been disclosed on an individual
basis.

Unless stated to the contrary, the information provided below is as of March 24, 2015.

I. Litigations involving our Bank

A. Outstanding litigations involving our Bank

Cases against our Bank

Criminal proceedings

As on March 24, 2015, there are five criminal proceedings pending against us. These complaints, being criminal
complaints, have been filed against individuals who were or are associated with our Bank in capacities as mentioned
hereinafter, at the time of the alleged acts or omissions. Any liability in these matters will accrue to the individuals
against whom the cases have been filed. Some of these also may be filed against the Directors or name the Directors
as a party to such complaints. For details, see the section titled “- Litigations involving the Directors of our Bank –
Outstanding litigation against our Directors” on page 328. Details of the other complaints are as follows:

1. Mr. K.M. Johny, proprietor of M/s. Rini Engineers, a customer of our Bank, filed a criminal complaint (R.C.C.
143/2003) dated November 29, 2002, before the Court of Judicial Magistrate First Class, Pimpri, Pune, against
our Bank and others, in relation to a loan of ` 2 million, on account of certain loan applications which had
allegedly been fabricated by accused. In the complaint it was alleged that that our Bank, along with the other
accused persons, created a loan in the name of the complainant and transferred the proceeds to the account of
M/s. Shalaka Enterprise, an accused in the said complaint. Pursuant to an order dated April 4, 2003, the court
issued process against our Bank. Our Bank has also filed a complaint before the Magistrate Court, Pune against

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 Mr. K.M. Johny and certain delinquent members of the staff of our Bank for alleged acts of cheating and
misappropriation of money against our Bank. The matters are currently pending.

2. Ms. P. Rajamani, treasurer of the Tamilnadu Technical Education Foundation, filed a criminal complaint (C.C.
No. 1074/2013) before the Court of Judicial Magistrate – II, Coimbatore, against Dr. P.V. Ravi and others,
including the branch manager of our Karumathampatty branch, in relation to certain alleged acts of cheating,
forgery, misappropriation of funds and assets of the trust, false fabrication of documents and criminal breach of
trust with regard to improper accounts being opened and operated in a manner contrary to the provisions of the
trust deed. Ms. P. Rajamani had earlier filed a complaint on May 11, 2011 before the Deputy Inspector General
of police, Coimbatore; however, the complaint was not registered by the police. Ms. P. Rajamani filed a petition
(Crl. O.P. 5356/2012) before the High Court of Judicature seeking a direction to register the complaint, which
was allowed by an order of the High Court dated March, 12, 2012. Ms. P. Rajamani furnished the order copy
before the police on March 23, 2012, however no action was initiated. Ms. P. Rajamani then furnished a notice
dated April 23, 2012 to register the complaint, failing which she would initiate contempt proceedings.
Thereafter, an FIR (No. 10/2012) was registered, however on account on lack of material averments in the FIR
the complainant filed a criminal contempt petition (C.C.P No. 1131/2012) before the High Court of Judicature.
Summons was issued against the concerned branch manager in the criminal complaint (C.C. No. 1074/2013).
The matter is currently pending.

3. Mr. Thomas Panjikkaran, a former shareholder of our Bank, filed a criminal complaint (C.M.P. 6428/2005)
before the Chief Judicial Magistrate, Thrissur in June 2006, against Mr. R.P. Joshua, the former chairman of our
Bank, the erstwhile principal secretary of our Bank and others in relation to certain alleged irregularities in the
conduct of the banking business during the period 1994-95, including inadequate action against defaulters and
failure to fix staff responsibilities. Pursuant to the directions of the Chief Judicial Magistrate, Thrissur, a police
investigation was conducted, wherein it was observed that allegations in the complaint were of a purely civil
nature and there was no case for initiation of criminal proceedings in the matter. Mr. Thomas Panjikkaran filed
a criminal miscellaneous petition (Crl. M.P. No. 3585/2006) before the Chief Judicial Magistrate, Thrissur
against the police investigation report, and pursuant to an ex-parte order of the court an enquiry was directed
into the matter. Subsequently, our Bank filed a criminal miscellaneous case (Crl. M.C. No.541 of 2007) before
the High Court of Kerala challenging the order of the Chief Judicial Magistrate, Thrissur, which was dismissed
by the High Court pursuant to an order dated March 1, 2007. Seeking a direction for quashing the complaint,
our Bank filed a special leave petition (Crl. No. 1853/2007) (“SLP”) before the Supreme Court, which was
admitted and a stay was granted in the matter pursuant to an order dated August 24, 2008.

Mr. Thomas Panjikkaran filed a writ petition (W.P. No. 2168/2008) before the High Court of Kerala, without
including our Bank as a party, wherein the Court passed an order for the completion of enquiry in the matter
within three weeks from the date of the order. Subsequently, our Bank and one of our erstwhile directors, Mr.
C.F. John, filed memoranda of writ appeals (W.A. Nos. 740/2008 and 741/2008, respectively) challenging the
order passed in W.P. No. 2168 of 2008. The division bench of the High Court, in a common judgment dated
April 3, 2008, dismissed the appeals. Our Bank then filed a criminal miscellaneous petition (Crl. M.P. No.
6813/2008) in the ongoing SLP, seeking further stay on the order passed by the High Court, which was granted
on April 24, 2008. Our Bank also filed a special leave petition (Crl. No. 4120/2008) before the Supreme Court
against the judgment and order dated April 3, 2008, passed by the High Court in W.A. Nos. 740/2008 and
741/2008. The matters are currently pending.

4. Mr. K. Ashraf, a businessman engaged in the business of wholesale grocery and carrying operations in the name
of M/s. Canara Traders, filed a criminal miscellaneous petition (C.M.P. No. 1358/2012) dated August 23, 2012
against Mr. T.K. Sashidharan, the erstwhile senior manager of the Kannur branch of our Bank and others, in
relation to certain property which had been mortgaged to secure a loan availed by the complaint, and had
allegedly been extended to loans taken by M/s Kerala Traders, an unassociated third party, without due
authorisation. Upon being informed of such mortgage by a newspaper advertisement regarding outstanding dues
of M/s. Kerala Traders and intended action of our Bank to take possession of the secured assets, Mr. Ashraf
filed the complaint stating that he had not guaranteed, nor executed a loan agreement, nor availed a loan, nor
created mortgage by deposit of title deeds in relation to the loan availed by M/s. Kerala Traders. Mr. K. Ashraf
had earlier filed a complaint (Cr. No. 804/2011) before the Kannur Police Station and on being dissatisfied with

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 police investigation, he filed the present complaint to summon the officials from our Bank. However, no
summons has been served upon the relevant officials yet. The matter is currently pending.

Civil proceedings

As on March 24, 2015, there are 61 civil suits pending against us before various courts in India, and the aggregate
amount claimed against us, to the extent quantifiable, is approximately ` 44.13 million. Details of the civil suits filed
against us, where the potential financial implication is over ` 10 million or where the potential financial implication
is not quantifiable, are as follows:

1. Apparel Export Promotion Council, a non–profit company sponsored by the Ministry of Textiles,
Government of India, filed a civil suit (CS (OS) 2361/2011) before the High Court of Delhi against its
concerned employees and others, in relation to the alleged fraudulent encashment of cheques and drafts in
the name of Apparel Export Promotion Council, by using fictitious names similar to its name. Several
banks, including our Bank, where the relevant bank accounts of the plaintiff were affected or the fictitious
accounts were opened, have been named as co-defendants in the suit. Apparel Export Promotion Council
filed the suit for recovery of ` 12.15 million, along with applicable interest. Our Bank submitted a written
statement dated February 22, 2011, stating that the loss was caused to the Apparel Export Promotion
Council on account of its own negligence and laxity in accepting the impugned cheques and drafts in
abbreviated names, and hence our Bank should not be held liable. The matter is presently pending.

2. Mr. N. Bhageerathan filed a writ petition (W.P. (C) No. 10053/2014) dated April 2, 2014 before High
Court of Kerala, Ernakulam, against the RBI and others, including our Bank, in relation to certain financial
accommodation obtained by the petitioner at the Kollam branch of our Bank. The petitioner in his writ
petition contended that in relation to his outstanding dues, which as on November 25, 2013 amounted to `
38.80 million, he had offered to settle his outstanding account for ` 12.50 million. However, our Bank had
sold his outstanding account to the Asset Reconstruction Company (India) Limited (“ARCIL”) for a sum
of ` 7.9 million and taken proportionately, the account was sold for ` 1.4 million, thereby ignoring the plea
to settle for ` 12.50 million. It was further stated in his petition that the assignment to ARCIL was in
contravention of the provisions of the SARFAESI Act and by his representation letter dated February 21,
2014, the petitioner had sought the RBI’s intervention to enquire into the matter. Since allegedly no action
had been taken by the RBI, Mr. N. Bhageerathan filed the present writ petition, including our Bank as a
respondent. The petition is currently pending.

3. Mr. Satheesh Kumar, legal heir of a deceased account holder of the Pattikkad branch of our Bank, filed an
original suit (O.S. No. 181 0f 2014) dated July 5, 2014 before the Sub-Court, Thrissur against Mr. Santhosh
Kumar and others, including our Bank. Mr. Satheesh Kumar sought the partition of the assets of the
deceased account holder, including fixed deposits aggregating to ` 1 million held with our Bank. The suit is
currently pending.

4. Ms. Lalitha Dharman, guarantor to a priority sector loan availed by Mr. Bhavish K. from the Pattikkad
branch of our Bank, filed an original suit (O.S. No. 3969 of 2014) dated June 18, 2014 before the Munsif
Court, Thrissur, against Deputy Tehsildar, (RR) Thaluk Office, Chavakkad and others, including our Bank.
The plaintiff stated that the revenue recovery authorities were not entitled to proceed against her and her
assets for recovery of the said loan, and sought a permanent injunction restraining the recovery authorities
from proceeding against the plaintiff and the relevant assets. Our Bank has been included as a defendant in
the suit as it is a necessary party, however no relief has been sought against us. The case is currently
pending.

5. Mr. Vattakandiyil Prabhakaran Nair, Mr. Vattakandiyil Sadanandan and Mr. Vattakandiyil Sivasankaran,
life interest holders in certain property mortgaged to avail a credit facility from the Kovoor branch of our
Bank, filed an original suit (O.S. No. 609 of 2013) dated December 16, 2013 before the Munsif Court,
Calicut, against our Bank and others. Our Bank had initiated proceedings under the SARFAESI Act with
respect to the said property, and issued a sale notice dated November 17, 2013 fixing the sale for December
20, 2013. The plaintiff sought a permanent injunction to restrain our Bank from proceeding with proposed
public auction of secured property. The matter is currently pending.

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6. M/s Silver Tower, a registered partnership firm and a former lessor of the Mysore branch of our Bank, filed
an original suit (O.S. No. 373/2008) dated March 4, 2008 before the First Additional Civil Judge (Junior
Division), Mysore, against our Bank, stating that the tenancy in favour of our Bank stood terminated and
sought to evict our Bank from the said premises. Further, M/s Silver Tower claimed mesne profits for the
period post termination of the tenancy. Pursuant to an order dated October 14, 2008, the court directed us to
vacate the property and hand over possession of the property within three months and issued instructions
for a separate enquiry for mesne profits from the date of the suit till the date of handover over of possession
of the property. The said order is currently un-initiated by the M/s Silver Tower.

Our Bank filed a regular appeal (R.A. 361/2009) dated November 17, 2008 before the Court of Civil Judge
(Senior Division), Mysore, to set aside the decree dated October 14, 2008. The appeal is currently pending.

7. Ozanam Home Society filed a civil original suit ((CS) (OS) No. 564 of 2014) dated February 21, 2014
before the High Court of Delhi, against Mr. Joseph Noronha and others, including our Bank. Ozanam
Home Society sought relief for restraining the defendants from disturbing the peaceful possession of the
office bearers of the society and further sought a mandatory and permanent injunction against our Bank to
de-freeze an account held by the society at our Bank. Pursuant to an interim order dated February 25, 2014
in I.A. 3689/2014, the High Court directed our Bank to permit withdrawal of an amount not exceeding `
70,000 for certain specified purposes. The matter is currently pending.

8. Mr. Vijay Dogra and others, lessors of premises of the Gurgaon branch of our Bank, filed a suit for eviction
(CS No. 4/2009) dated October 26, 2009 before the Rent Controller, Gurgaon against our Bank, stating that
one of the petitioners wanted to open a restaurant/hotel on the premises and had accordingly issued a legal
notice dated November 3, 2008 for termination of our lease. Pursuant to a decree dated May 29, 2014, the
suit was decided in favour of plaintiffs, and our Bank was directed to vacate the premises. Our Bank filed
an appeal (CA No. 104/2014) dated July 10, 2014 before District Judge, Gurgaon, to set aside the order of
eviction passed by the Rent Controller, wherein a stay on the operation of impugned decree of the Rent
Controller was granted. The appeal filed by our Bank is currently pending.

9. Mr. M. Matthew, the chairman and managing director of Muthoot Mercantile Limited, an NBFC, filed a
writ petition (W.P. (C) No. 31023/2014) dated November 18, 2014 before the High Court of Kerala,
Ernakulam against the Union of India, RBI and certain banks, including our Bank. Mr. M. Matthew sought
an investigation into operations of the banks with regard to floating of agricultural gold loan products
pursuant to the Scheme of Interest Subvention introduced by the RBI and prayed before the Court to
declare the said scheme as ultra vires the Constitution of India. The matter is currently pending.

10. Muthoot Mercantile Limited filed an appeal dated March 9, 2015 before the Competition Appellate
Tribunal, New Delhi against the Competition Commission of India and others, including our Bank,
challenging an order dated December 30, 2014 passed by Competition Commission of India wherein the
claim of Muthoot Mercantile Limited regarding conducting enquiry into cartelization by the respondent
banks with respect to the launch of agricultural gold loan products at the rate of 4% was dismissed. The
appellant has stated that this allegedly caused an appreciable adverse effect on competition, causing
detriment to the business of the appellant and other NBFCs dealing in gold loans. The matter is currently
pending.

11. Mr. A. Murthy Raju, a customer of the Vijaywada branch of our Bank, filed a writ petition (W.P. No.
3509/2010) before the High Court of Andhra Pradesh against the Union of India and others, including our
Bank, seeking a direction for extension of the Agricultural Debt Waiver and Debt Relief Scheme, 2008
with respect to a loan availed by him from our Bank and urged for a declaration that the inaction by the
respondents is ultra vires the provisions of the Constitution of India. The High Court issued a show cause
notice dated February 17, 2010, wherein our Bank was directed to not take any coercive steps for
recovering the loan amount. The matter is currently pending.

12. Mr. Alla Appa Rao, a customer of the Vijaywada branch of our Bank, filed a writ petition (W.P. No.
4424/2009) dated February 13, 2009 before the High Court of Andhra Pradesh, against our Bank and

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 others, seeking a declaration that inaction to waive interest on an agricultural loan availed by him was ultra
vires the Constitution of India, in the light of Circular No. RBI 2006-07/156/RPCD PLFS No. BC 31-05-
04-02-2006-07 dated October 18, 2006 and Circular No. 24/13.05.2000/20.06.2007 dated December 26,
2006. The High Court of Andhra Pradesh issued a show cause notice dated March 14, 2009, wherein our
Bank was instructed to not take any coercive steps for recovering the loan amount and Mr. Alla Appa Rao
was directed to make a representation before our Bank in light of aforesaid circulars. The matter is
currently pending.

13. Ms. Snigdha Ghosh and another filed a title suit (T.S. No. 97of 2013) dated May 13, 2003 before the Civil
Judge (Junior Division) – II, Baruipur, South 24 Paraganas, against Mr. Susanta Chandra and our Bank,
represented by the senior manager of the Burra Bazar, Kolkata branch of our Bank. The plaintiffs
contended that Mr. Susanta Chandra had agreed to sell them certain property which already stood
mortgaged to our Bank in connection with a credit facility availed by Mr. Joydeb Kumar Haldar, the
previous owner of the property. The plaintiffs further contended that the Mr. Susanta Chandra forced them
to vacate the said property, despite placing them in possession after the receipt of part consideration. The
plaintiffs sought a declaration that they are the legal occupiers of the property having paid part of the
consideration. The plaintiffs also sought an injunction against the forcible eviction by Mr. Susanta Chandra
and our Bank. The matter is currently pending.

14. Mr. Ramesh Babu filed an original suit (O.S. 4266 of 2014) dated July 22, 2014 before the Court of City
Civil Court, Chennai, against our Bank and others, asserting absolute ownership of certain property which
stood mortgaged in favour of our Bank in connection with a credit facility availed by one of the defendant
from the Puducherry branch of our Bank. Mr. Ramesh Babu alleged that the concerned defendant, being the
holder of his power of attorney, had without any prior intimation, assigned the said property and therefore
the said sale as well as the subsequent mortgage would not be binding upon him. Mr. Ramesh Babu sought
an injunction restraining the defendants, including our Bank, from causing interference with the peaceful
possession of the property. The matter is currently pending.

15. Mr. C.J. Joseph Kutty, lessor of the premises of the Thottakad branch of our Bank, filed an original suit
(O.S. No. 352 of 2012) dated November 8, 2012 before the Munsif Court, Changanacherry, against our
Bank, seeking a decree of eviction on account of the expiration of our lease on February 1, 2010 pursuant
to a lease agreement dated May 17, 2005. Mr. C.J. Joseph Kutty also claimed future mesne profits for the
use and occupation of the property post such expiration. Our Bank submitted a written statement on April
2, 2013. The matter is currently pending.

16. M/s. St. Joseph’s Press, a customer of the Palayam branch of our Bank, filed an original suit (O.S. 720 of
2012) dated May 29, 2012 before the Thiruvanathapuram Sub-Court against M/s Rajhans Enterprises and
our Bank, stating that M/s. St. Joseph’s Press had availed a term loan of ` 1.80 million for the purchase of a
second hand printing machine from M/s Rajhans Enterprises, two bank guarantees aggregating to ` 6.00
million were issued in favour of M/s Rajhans Enterprises. Contending that the said machinery was
defective and sold to him based on misrepresented facts, the plaintiff sought a decree for recovery of ` 15
million from M/s Rajhans Enterprises along with future interest of 12 % p.a. A decree of permanent
prohibitory injunction was also sought to restrain our Bank from honouring a partial claim of the bank
guarantee of ` 3.00 million made by the M/s Rajhans Enterprises. Our Bank received a legal notice dated
July 24, 2012 from M/s. St. Joseph’s Press and by our reply dated July 30, 2012, our Bank informed M/s.
St. Joseph’s Press that the payment of impugned bank guarantee had been made on June 4, 2012 in the
absence of a stay order of the court. The matter is currently pending.

17. Ms. Nimmy John, legal heir of a customer of the Market Road, Ernakulam branch of our Bank, filed a writ
petition (W.P. (C) No. 1070/2006) dated January 10, 2006 before the High Court of Kerala, Ernakulam
against our Bank and others, challenging an auction sale conducted by the Debt Recovery Tribunal
pursuant to recovery proceedings in a transfer application (T.A. 1295/1997) which had been instituted by
our Bank for recovery of loan dues amounting to ` 2.73 million. The matter is currently pending.

18. Ms. Nimmy John, legal heir of a customer of the Market Road, Ernakulam branch of our Bank, filed an
original suit (O.S. No. 279/2014) dated October 25, 2014, before the Subordinate Court, Ernakulam,

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 against our Bank and others seeking a decree for redemption of mortgage and to recover possession of the
property mortgaged in favour of our Bank by her predecessor in title, stating that that the concerned debt
facility had been fully satisfied. The matter is currently pending.

19. Mr. Porinju and others, legal heirs of a customer of the Poochinipadam branch of our Bank, filed an
original suit (O.S. No. 199 of 2009) dated January 15, 2009 before the Munsif Court, Thrissur, against Mr.
George and others, including our Bank, in relation to the alleged right claimed by the plaintiffs over certain
deposit accounts which were held by their predecessor in title, on the strength of a will (No. 163/2002)
registered before the Sub-Registrar, Cherpu, Kerala, apprehending that Mr. George would unlawfully
withdraw the fixed deposit. The plaintiffs sought a declaration of their sole right over the said fixed
deposits and a direction restraining our Bank from releasing the fixed deposit amounts in favour of Mr.
George. The original suit was dismissed pursuant to an order of the court dated July 31, 2010, against
which the plaintiffs filed an appeal (A.S. No. 374/2010) dated November 26, 2010, before the Principal
District Court, Thrissur. Pursuant to an interim order dated November 29, 2010 in I.A. No. 3957/2010, the
appellate court directed our Bank to maintain status quo with respect to impugned order in the civil suit.
The matter is currently pending.

20. Ms. Beevathu, filed an original suit (O.S. No. 45/2014) before the Chavakkad Munsif Court against Mr.
Shamsuddin and others, including our Bank, claiming ownership over certain property which stood
mortgaged in favour of our Bank for availing credit facilities by Mr. Shamsuddin and Mr. Mohammad
Iqbal, the defendants. Pursuant to an order passed in a recovery suit (O.S. 774 of 2002) filed by our Bank
with respect to the said property, the property had been auctioned and post bidding, the sale had been
confirmed in favour of our Bank, thereby rendering it as a non–banking asset of our Bank. Ms. Beevathu
has, in the original suit, sought declaration of her ownership over the property on account of a subsequent
sale deed (No. 168/2010) dated January 21, 2010, alleging that the auction sale in favour of our Bank is not
binding upon her. The matter is currently pending.

21. Ms. Rosamma Joseph, a customer of our Bank, filed a writ petition (W.P. (C) No. 35093/2005) dated
November 25, 2005 before the High Court of Kerala, Ernakulam, against the Mukkoottuthara branch of our
Bank and the Banking Ombudsman, Thiruvananthapuram, challenging an order of the Banking
Ombudsman, Thiruvananthapuram wherein her claim for refund of excess interest allegedly charged by our
Bank on her loan account had not been considered. The matter is currently pending.

22. Mr. A. Antony John and another filed an original suit (O.S. No. 162/2014) dated February 27, 2014 before
the Additional District Munsif Court, Alandur, against our Bank and others. The plaintiffs, along with two
of the defendants to the suit, are directors of M/s Corrium Trading Limited and had availed cash credit
limits from our Bank which had been secured by collateral security of certain immovable properties.
Thereafter, due to difference of opinion and dispute between the directors of M/s Corrium Trading Limited
in relation to the plaintiffs’ apprehended misuse of the title deeds, the plaintiffs sent a letter dated April 18,
2013 addressed to our Bank, requesting our Bank to not release the title deeds without the written consent
of the plaintiffs. On December 27, 2013, the other defendant banks named in the suit refused to accept the
request, and on January 4, 2014, the plaintiffs issued a notice in the matter. The plaintiffs have sought a
permanent injunction restraining our Bank from misusing the title deeds in any manner. The matter is
currently pending.

23. Mr. Jacob Cherian, director of M/s Corrium Trading Limited, in his personal capacity, filed an original suit
(O.S. No. 6036/2014) before the Court of City Civil Judge, Chennai, against our Bank, seeking a direction
to restrain our Bank by way of a permanent injunction from selling gold ornaments pledged by him to avail
gold loans amounting to ` 0.88 million from our Bank. The matter is currently pending.

24. M/s. Corrium Trading Limited, represented by its managing director, Mr. Jacob Cherian, filed an original
suit (O.S. 3879/2013) dated July 15, 2013 before the Court of City Civil Judge, Chennai, against our Bank,
contending that some of its directors were attempting to take possession of title deeds which were deposited
to at the Guindy branch of our Bank for availing certain credit facilities. As two of directors of M/s.
Corrium Trading Limited withdrew the guarantee, by a letter dated April 23, 2013 our Bank had informed
them that the concerned accounts had been frozen. M/s. Corrium Trading Limited sought to declare the

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 abovementioned letter as null and void, and the release of title deeds in their favour. Injunctions to restrain
our Bank from proceeding for recovery and for allowing their normal operations to continue have also been
sought. The matter is currently pending.

25. M/s. Corrium Trading Limited, represented by its managing director Mr. Jacob Cherian, filed an original
suit (O.S. 5530/2013) dated September 19, 2014, before the Court of City Civil Judge, Chennai, against our
Bank, contending that our Bank had frozen certain accounts held at the Guindy branch of our Bank on
account of the withdrawal of guarantees by two of its directors, as informed by a letter of our Bank dated
April 23, 2013. M/s. Corrium Trading Limited alleged that despite a communication received from our
Bank stating that the accounts would become operational after payment of interest dues and furnishing of
additional security, and payment of such interest and an offer to provide further security, our Bank did not
agree to defreeze their account. M/s. Corrium Trading Limited therefore sought, inter alia, a mandatory
injunction against us to consider security offered by them and further sought for renewal of the existing
cash credit facilities as well as a permanent injunction restraining our Bank from declaring the account of
M/s. Corrium Trading Limited as a non-performing asset and urged the court to restrain our Bank from
charging the interest to the frozen account. The matter is currently pending.

26. Mr. Dattatreya C. Surti, a customer of the Panaji branch of our Bank, filed a regular civil suit (No.
46/2014/C) dated April 4, 2014 before the Court of Civil Judge, Junior Division C., Panaji, against our
Bank, contending that for renewal of certain gold loans availed by him from our Bank, he had offered to
pay accrued annual interest and expressed non-inclination towards payment of differences on account of
fluctuations in gold prices, as required to be paid in light of the gold loan norms of our Bank. Mr.
Dattatreya C. Surti sought an injunction restraining our Bank from selling the pledged gold ornaments
pursuant to a public auction. The court granted an interim stay in the matter by an order dated April 8,
2014, wherein our Bank was directed not to proceed with the auction. The matter is currently pending.

27. Ms. Kanta Rani Nayyar and others filed a civil suit (C.S. No. 3213/2014) before the Court of Civil Judge
Junior Division, Amritsar, against Mr. Kamal Bawa and others, including our Bank, contending that Mr.
Kamal Bawa had allegedly unlawfully availed a loan from our Bank by mortgaging the plaintiffs’ property
in favour of our Bank by a mortgage deed dated August 4, 2012. The plaintiffs sought a declaration that the
mortgage deed dated August 4, 2011 allegedly executed by Mr. Kamal Bawa in favour of the Chandigarh
branch of our Bank is illegal and void and liable to be rescinded. The matter is currently pending.

28. Ms. Kanta Rani Nayyar and others filed a civil suit before the Civil Judge Senior Division, Chandigarh,
against our Bank and Mr. Kamal Bawa, contending to be the owners in possession of certain property
which was mortgaged in favour of our Bank for availing a loan facility by Mr. Kamal Bawa and others. The
plaintiffs sought a declaration of ownership and their possession, while seeking a permanent injunction
restraining the defendants from taking any action on the property based upon the mortgage. The matter is
currently pending.

29. Mr. V. M. James, a customer of the Keerampara branch of our Bank, filed an original suit (O.S. No.
21/2014) against the State Government of Kerala and others, including our Bank, contending that despite
the alleged repayment of entire loan amount with respect to a credit grant of ` 15, 000 availed by him from
our Bank, recovery authorities continued to pursue the claim against him for outstanding dues amounting to
` 19,962. Mr. V. M. James sought an injunction restraining recovery authorities and our Bank from
proceeding with revenue recovery actions. The matter is currently pending.

30. M/s. ATV Projects India Limited filed a writ petition (W.P. No. (C) 4226/2013) dated June 26, 2013 before
the High Court of Delhi, against Punjab National Bank and others, including our Bank, challenging a
common order dated May 14, 2013 passed by the Appellate Authority of Industrial and Financial
Reconstruction dismissing Appeal nos. 324/2002 and 117/2004 filed by M/s ATV Projects India Limited in
relation to a rehabilitation scheme preferred by the company, on account of one of the secured creditors
disapproving an offer for one-time settlement, rejecting the contention of M/s. ATV Projects India Limited
that consent of all secured creditors would be required. M/s. ATV Projects India Limited, in the writ
petition, has sought, inter alia, a declaration that the one-time settlement is binding upon the defendant
banks. The matter is currently pending.

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31. Mr. Anil Kumar, a customer of the Ponkunnam branch of our Bank, filed an original Suit (O.S. No.
133/2014) dated April 5, 2014 before the Munsif Court, Kanjirapally, against our Bank, challenging the
alleged escalation in interest from 13.25% p.a. in 2008 to 19.25% p.a. in 2010 by our Bank without his
consent, on loans amounting to ` 1.90 million availed by him and alleging that our Bank demanded an
additional amount of ` 0.38 million to liquidate the loans. Mr. Anil Kumar sought a permanent injunction
restraining our Bank from charging interest over 13.25% p.a. The matter is currently pending.

32. Mr. Neeraj Kishore filed an original suit (O.S. No. 213/2008) dated March 1, 2008 before the Subordinate
Court, Thiruvananthapuram, against our Bank and others, contending that he is the lawful owner of certain
property settled in his favour by his deceased father and that our Bank personnel tried to trespass into the
said property claiming a right over the land which is situated appurtenant to the said property. Mr. Neeraj
Kishore sought a perpetual injunction prohibiting our Bank from trespassing onto the said property. The
matter is currently pending.

33. Mr. Joy Ambooken filed an appeal (Company Appeal No. 3/2013) dated March 4, 2013 before the High
Court of Judicature of Kerala, against our Bank and Mr. Ajay Lal, our Director, challenging an order of the
Company Law Board, Chennai dated December 27, 2012, dismissing the company law petition (CP No.
68/2009) which had been filed by the appellant. Mr. Joy Ambookan filed a company petition (C.P. No.
68/2009) before the Company Law Board, Chennai (“CLB”) against our Bank and others, seeking a
direction to our Bank to set aside the allotment of 3.21 million equity shares of our Bank made on a rights
basis in 2008 to members of Siam Vidhya Group (“SVG”), and the dismissal of concerned directors of our
Bank, and an order for re-casting of balance-sheet made up to March 31, 2009, after repayment of amount
paid by the members of SVG towards acquisition of the equity shares. Mr. Joy Ambookan additionally
sought an order for the issuance of 3.21 million equity shares to those shareholders who subscribed for the
said rights issue as per allotment list as on February 2, 2009 for a consideration of ` 120 per share and
sought investigation into the affairs of our Bank.

34. Mr. Antony C. Sakri and others filed a writ petition (W.P. No. 102686/2015) dated March 5, 2015 before
the High Court of Karnataka at Dharward, against our Bank and others, in relation to an overdraft facility
of ` 1 million availed by the petitioners in April 2002, for starting a BSNL franchise. On account of closure
of BSNL franchisee scheme, the loan account of the petitioners had been declared as a non-performing
asset of our Bank. The petitioners stated that an offer for one-time settlement by payment of ` 1.40 million
had not been accepted by our Bank and that our Bank had initiated proceedings under the SARFAESI Act
against them. The petitioners sought a writ of mandamus, directing our Bank to accept the offer for one-
time settlement and settle their loan account. The petitioners also sought a direction to restrain our Bank
from proceeding further under the provisions of SARFAESI Act. The matter is currently pending.

35. Mr. Mattupalli Kiran and Ms. Mattupalli Kusuma Kumari filed an original suit (O.S. 253/2011) before the
Court of District Judge, Guntur, against Mr. Mattupalli Siva Naga Srinivasa Rao and others, including our
Bank. The plaintiffs, being legal heirs of Mr. Mattupalli Siva Naga Visweswara Rao, the deceased lessor of
the premises of the Guntur branch of our Bank, filed the suit against Mr. Mattupalli Siva Naga Srinivasa
Rao and others, seeking a declaration that they are absolute owners of the said property, which includes our
Branch premises and an injunction restraining Mr. Mattupalli Siva Naga Srinivasa Rao from causing
interference with peaceful possession of the property by the plaintiffs, along with their claim for other
reliefs. Further, Mr. Mattupalli Kiran and Ms. Mattupalli Kusuma Kumari alleged that our Bank expressed
difficulty, in the absence of a court direction, to pay rents in favour of plaintiffs because the first defendant,
being the brother of the deceased lessor, was also claiming rent from our Bank. The matter is currently
pending.

36. Mr. Mattupalli Siva Naga Srinivasa Rao filed an original suit (O.S. 89/2012) dated January 27, 2012 before
the Court of Senior Principal Civil Judge, Guntur against our Bank, represented by the branch manager of
the Guntur branch of our Bank. Mr. Mattupalli Siva Naga Srinivasa Rao stated that Mr. Mattupalli Siva
Naga Visweswara Rao, the deceased lessor of the premises of the Guntur branch of our Bank, had executed
a registered gift deed (No. 10355/2010) dated October 21, 2010, conveying the property, including the
premises leased out to our Bank, in favour of the plaintiff. The plaintiff contended that our Bank had not

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 replied to a notice dated June 8, 2011 furnished by him, requesting for the rent to be paid directly to him.
Mr. Mattupalli Siva Naga Visweswara Rao’s wife also filed a suit (O.S. No. 253/2011) before the
Additional Judge - III, Guntur, seeking declaration of title in respect of the property. Mr. Mattupalli Siva
Naga Srinivasa Rao thereafter filed a suit (O.S. 346/2011) before the Court of Senior Civil Judge, Guntur,
seeing a permanent injunction restraining the wife of Mr. Mattupalli Siva Naga Visweswara Rao from
interfering with the possession and enjoyment of the properties conveyed to him. Further, Mr. Mattupalli
Siva Naga Srinivasa Rao alleged that our Bank willfully avoided payment of rent due to him despite a
notice furnished by him to our Bank on December 10, 2011 requesting for payment of rent dues, and for the
termination of tenancy with effect from December 31, 2011 and vacation of property by January 1, 2012.
The plaintiff had mentioned in the notice that upon failure to vacate the said premises by January 1, 2012,
our Bank would be liable to pay damages at the rate of ` 5,000 per day for use and occupation of the
premises. The plaintiff stated that our Bank had allegedly failed to comply with the notice, and hence
sought a decree of eviction of our Bank from the premises of our Guntur branch and recovery of dues
amounting to ` 0.27 million, along with subsequent interest of 24% p.a. till the date of realization. The
matter is currently pending.

Consumer cases

As on March 24, 2015, there are 27 consumer proceedings pending against our Bank, which have been filed before
the national and various state and district consumer dispute redressal forums. These proceedings primarily relate to
delay in disbursement of loans, non-payment of adequate interest on deposits, excess interest charged on loans and
fraudulent transfers of amounts from the bank accounts of customers, account holders etc. The aggregate amount
claimed in such proceedings against our Bank, to the extent quantifiable, is approximately ` 29.87 million. Details
of the consumer proceedings initiated against us, where the potential financial implication is over ` 10 million, or
where the potential financial implication is not quantifiable, are as follows:

1. Mr. Sebastian Karimpil and Ms. Rosamma Sebastian, joint-account holders of a NRE Account with the Kaloor
branch of our Bank, filed a consumer complaint (C.C. No. 80 of 2013) dated September 13, 2013, before the
Kerala State Consumer Disputes Redressal Commission, Thiruvananthapuram, against our Bank, the managing
director/ chief executive officer of our Bank and our part-time Chairman, claiming a compensation of ` 10
million for alleged negligence and deficiency in services by our Bank, which resulted in hacking of their
registered customer email account and consequent fraudulent withdrawal of ` 4.30 million from their bank
account. The complainants sought compensation for loss sustained by them for an amount of ` 4.30 million,
along with bank interest from the date of loss of the amount till the date of filing the complaint and thereafter at
the rate of 18% p.a. till realization of the amount, compensation from our Bank for an amount of ` 5 million
with interest at the rate of 18% p.a. and a sum of ` 0.5 million towards costs of the complaint. Our Bank filed a
reply dated January 21, 2014, stating that due procedure was followed pursuant to National Electronic Fund
Transfer instructions received from the registered email accounts of the complainants and there was no
deficiency in service as alleged in the complaint.

With respect to the above-mentioned incident, our Bank also filed a complaint dated May 25, 2013 before the
Ernakulum North Police station, subsequently registered as an FIR (FIR No. 711/2013) dated May 26, 2013,
investigation therein is currently is process. Mr. Sebastian Karimpil, also filed a complaint dated June 17, 2013
before the Banking Ombudsman, which was subsequently rejected on July 16, 2013. The consumer complaint is
currently pending.

2. Mr. Manu Kamal and others filed a consumer complaint (C.C. No. 87 of 2014) before the Kerala State
Consumer Disputes Redressal Commission, Thiruvanathapuram, against our Bank, in relation to certain gold
loans for an amount of ` 4.75 million availed by the complainants from the Nemom, Thiruvanathapuram branch
of our Bank, against the pledge of gold ornaments. The complainants have alleged that they were forced to pay
` 1.06 million towards the security on account of fluctuation of gold prices, and that our Bank refused to accept
an offer made by the complainants for remittance of interest amount of ` 0.60 million. The complainants sought
a direction to our Bank to accept interest for gold loans as offered by them and to allow renewal of their gold
loans. The Kerala State Consumer Dispute Redressal Commission, Thiruvanathapuram, pursuant to an interim
order dated September 26, 2014 in I.A. No. 906/2014, stayed auction proceedings initiated by our Bank with
respect to the pledged gold held by our Bank. The matter is currently pending.

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Proceedings before the Banking Ombudsman

There are three complaints which have been filed against our Bank before the Banking Ombudsman, details of
which are as follows:

1. Sudhir Enterprises, an account holder of our Bank, submitted a complaint through an email dated December 29,
2014 before the Banking Ombudsman, Thiruvananthapuram, with respect to the alleged delay in realization of a
demand draft for USD 6,400, which had been presented by the complainant at our Bank. The complainant has
sought for the authority to help ascertain the reason for the alleged delay and direct our Bank to credit the
proceeds of the demand draft, along with interest, to the account of the complainant for the delayed period.
Pursuant to a letter dated March 14, 2015 addressed to our Bank, the complainant sought an amount of ` 19,200
towards the rate difference on USD during the period of delay, along with interest at the rate of 10% for 30
days, amounting to ` 3,300, as well as legal expenses. The complaint is currently pending.

2. Ms. Mary Varghese submitted a complaint dated February 18, 2015 before the Banking Ombudsman,
Trivandrum, with respect to the deduction of ` 2,635 toward tax from the maturity value of ` 62,660 for a fixed
deposit held by the complainant at our Bank. The complainant has sought for the authority to help recover the
amount deducted towards tax. The complaint is currently pending.

3. Mr. Babu submitted a complaint dated February 23, 2015 before the Banking Ombudsman,
Thiruvananthapuram, in relation to an education loan for his daughter. The complainant alleged that he had
submitted requisite documents required by our Bank for the year 2013-14, and had a meeting with the branch
manager of the Puthiyakavu branch of our Bank on August 16, 2014, during which the branch manager
promised to give him the loan. The complainant tried for the loan frequently, but the loan was not granted. The
branch manager has now sought requisite papers for the year 2014-15. The complainant has sought for the
authority to ensure steps are taken by our Bank to sanction the education loan and for the continuation of such
loan.

Labour Proceedings

As on March 24, 2015, there are 34 cases filed against our Bank by various former or current employees of our Bank
before various tribunals and courts. These proceedings primarily relate to claims for allegedly wrongful termination
of service, reinstatement along with back wages, promotions, transfers, claims pertaining to terminal benefits and
disciplinary actions taken against them. Details of the proceedings currently pending are as follows:

Industrial disputes

1. The Catholic Syrian Bank Staff Association (“CSB Staff Association”) filed a complaint dated July 6, 2012
before the Assistant Labour Commissioner (Central), Kochi (“ALC, Kochi”), against our Bank in relation to the
alleged non-payment of special pay benefits to cashiers handling additional duties, in violation of the terms of
bipartite settlements entered into between the Indian Banks’ Association and workmen. Our Bank submitted
written statements on November 9, 2012 and April 24, 2013. The ALC, Kochi, initiated conciliation
proceedings, and on March 4, 2013, directed our Bank to pay the difference in pay of ` 280 for the additional
services. Subsequently, the matter was referred as an industrial dispute (I.D. 38/2013) before the Central
Government Industrial Tribunal cum Labour Court, Ernakulam. Our Bank submitted a written statement on May
13, 2014. The matter is currently pending.

2. Mr. A.J. Varghese filed a petition (C.P. 3 of 2011) on April 24, 2011 before the Central Government Industrial
Tribunal cum Labour Court, Ernakulam, against our Bank, in relation to special allowances which he was
allegedly entitled to post his promotion, that is, from sub staff cadre to clerical cadre. The petitioner sought a
direction to our Bank for the payment of such special allowances, amounting to ` 0.19 million, or as may be
declared as payable by the court. Our Bank submitted a counter statement praying for the dismissal of the
petition on October 3, 2011, and the petitioner submitted a rejoinder on January 4, 2012. Pursuant to an order
dated October 15, 2012, the petition was dismissed due to non-appearance of the petitioner. The petitioner filed a

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 petition for restoration of C.P. 3 of 2011 on October 29, 2012, to which our Bank filed a counter on April 18,
2013. The matter is currently pending.

3. The CSB Staff Association filed a complaint dated September 13, 2010 before the ALC, Kochi, against our Bank
in relation to the allegedly wrongful dismissal of Mr. Manu Jose, a member of the subordinate staff of our Bank,
in June 2010, and imposition of compulsory retirement with superannuation benefits as a consequence of certain
alleged acts of misconduct committed by him. Our Bank submitted a written statement on November 1, 2010.
The matter was subsequently referred as an industrial dispute (I.D. 26 of 2011) before the Central Government
Industrial Tribunal cum Labour Court, Ernakulam .The CSB Staff Association sought a declaration by the court
that the dismissal was wrong and unjust, and a direction to our Bank to reinstate Mr. Manu Jose with full back
wages, continuity of services and other benefits, along with payment of costs of the litigation, and filed a
statement of claims dated August 3, 2011. Our Bank submitted a written statement on February 25, 2012. The
mater is currently pending.

4. Mr. Sitangshu Bhusan Mazumdar submitted a representation before the Assistant Labour Commissioner
(Central), Kolkata, challenging disciplinary action taken by our Bank against him with respect to an alleged
shortage in the remittance of certain amount of money to another bank for which he was responsible in his
capacity as the cashier in charge of the Lal Bazar branch, Kolkata. Pursuant to an order dated September 28,
2004 of the disciplinary authority of our Bank, compulsory retirement with superannuation benefits was imposed
as a penalty on Mr. Mazumdar. Conciliation proceedings on the dispute were declared as failed and pursuant to a
report of the conciliation officer dated May 25, 2006, the matter was refered as an industrial dispute (I.D.
26/2006) before the Central Government Industrial Tribunal, Kolkata. Mr. Mazumdar filed a statement of claims
dated November 28, 2006, seeking a direction to set aside the order dated September 28, 2004, along with a
direction to reinstate him into service with full benefits. Our Bank filed a written statement on March 6, 2007.
Evidence has been submitted by Mr. Mazumdar on January 10, 2012. The matter is currently pending.

5. Mr. Tapan Kumar Das submitted a representation dated March 11, 2010 before the Assistant Labour
Commissioner (Central), Kolkata, challenging disciplinary action taken by our Bank against him with respect to
alleged fraudulent withdrawals from accounts for which he was responsible in his capacity as the clerk cum
cashier of the Burra Bazar branch, Kolkata. Pursuant to an order dated August 5, 2008 of the disciplinary
authority of our Bank, lowering of one stage of employment scale in salary for a period of two years was
imposed as a penalty on Mr. Das, which was confirmed by the appellate authority on October 25, 2008.
Conciliation proceedings on the dispute were declared as failed and pursuant to a report of the conciliation
officer dated March 28, 2011, the matter was refered as an industrial dispute (I.D. 5/2011) before the Central
Government Industrial Tribunal cum Labour Court, Kolkata. Mr. Das filed a statement of claims dated
November 8, 2011, seeking a direction to set aside the penalty imposed, along with a direction to restore his
increment and pay back all consequential benefits and award reasonable costs. Our Bank filed a written
statement on November 30, 2011. Evidence has been submitted by Mr. Das on January 10, 2012. The matter is
currently pending.

Conciliation proceedings before the Assistant Labour Commissioner

1. The CSB Staff Association filed a complaint dated October 8, 2014 before the ALC, Kochi, in relation to the
transfer of Mr. Shoby Arimboor, a member of the award staff of our Bank, allegedly in violation of the transfer
policy of our Bank being an individual transfer between general transfers. The CSB Staff Association sought a
direction that the violation of the transfer policy be rectified, or else prosecution under section 29 of the
Industrial Disputes Act be initiated. Our Bank submitted a written statement to the ALC, Kochi on February 4,
2015, stating that the complaint was frivolous and would not come within the purview of an industrial dispute as
defined under the Industrial Disputes Act, as Mr. Arimboor was not a member of the CSB Staff Association, and
that the conciliation proceedings were unwarranted. The matter is currently pending.

2. The CSB Staff Association filed a complaint dated May 19, 2014 before the ALC, Kochi, in relation to the denial
of a transfer application of Ms. Neetha Antony, who had been employed on compassionate grounds by our Bank.
The CSB Staff Association sought a direction to our Bank to transfer Ms. Neetha Antony to any branch near
Palakkad. Conciliation proceedings were initiated by the ALC, Kochi pursuant to a letter dated May 27, 2014.
Further to proceedings held on February 13, 2015, the parties failed to reach a settlement and the conciliation

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 proceedings were declared as failed and proceedings were closed for reference to the Central Government in
accordance with the Industrial Disputes Act. Our Bank is yet to receive any further intimation with respect to the
matter.

3. The CSB Staff Association had initially filed an industrial dispute (I.D. 7/2006 and 8/2006) before the Central
Government Industrial Tribunal cum Labour Court, Ernakulam, against our Bank in relation to the alleged non-
disbursement of computer allowance arrears to eligible employees, in accordance with the bipartite settlement
agreement of our Bank with the employees. Pursuant to an award dated July 18, 2006 of the Labour Court and
subsequent dismissal of our petition by the High Court of Kerala at Enrakulam on July 31, 2009, our Bank was
directed to pay computer allowance to all the computer operators of our Bank. Subsequently, the CSB Staff
Association filed a complaint dated June 18, 2014 before the ALC, Kochi alleging our Bank had not yet
disbursed the allowance to all eligible employees in accordance with the directions of the ALC, Kochi. Our Bank
submitted a written statement on August 8, 2014, praying for the dismissal of the complaint. The matter is
currently pending.

4. The CSB Staff Association filed a complaint dated December 1, 2013 before the ALC, Kakkanad, challenging a
notice issued by our Bank under section 9A of the Industrial Disputes Act to effect certain changes to the
existing transfer policy of our Bank which had been instituted pursuant to a tripartite agreement between the
management of our Bank and staff unions of our Bank. Our Bank submitted a written statement to the ALC,
Kakkanad on March 24, 2014, to which the CSB Staff Association replied on April 25, 2014. Further to
proceedings held on May 19, 2014, our Bank was directed to provide an explanation regarding the proposed
changes, which was provided on October 9, 2014. The ALC, Kakkanad directed our Bank to cancel the notice
issued under Section 9A and and to hold a joint discussion with the unions on the issues being faced with the
existing policy. Subsequently, the conciliation proceedings were disposed of on November 14, 2014 with a
direction to our Bank to comply with the minutes dated October 9, 2014, and the CSB Staff Association to file a
complaint in case of failure by our Bank to comply with the directions.

Criminal disciplinary proceedings

1. The CSB Staff Association had initially filed an industrial dispute (I.D. 268/2006) before the Central
Government Industrial Tribunal cum Labour Court, Ernakulam, against our Bank in relation to non-
implementation of certain special allowances post promotions from sub staff cadre to clerical cadre, and the
alteration of dates of increment post such promotions. The industrial dispute was disposed of pursuant to an
award of the court dated July 6, 2007, directing our Bank to implement the special allowances and salary payouts
for the impugned staff members. Subsequently, the Labour Enforcement Officer (Central), Kochi, filed a
criminal complaint (C.C. 2485/2011) before the Judicial Magistrate – First Class, Thrissur, in relation to the
alleged failure by our Bank to implement the award under the industrial dispute.

Our Bank, through Mr. V.P. Iswardas, our erstwhile Managing Director and CEO and Mr. Sijo Varghese our
Company Secretary and Compliance Officer, filed a criminal miscellaneous case (Cri. M.C. No. 1998/2012)
against the Labour Enforcement Officer (Central), Kochi, and the State of Kerala through the Public Prosecutor,
High Court of Kerala, seeking a direction to quash the C.C. 2485/2011. Pursuant to an order dated May 31, 2012,
the High Court admitted the petition and granted an interim stay for three weeks in the matter. The Labour
Enforcement Officer (Central), Kochi submitted a written statement on August 6, 2012. Pursuant to a judgment
dated September 29, 2014, the High Court dismissed the criminal miscellaneous case filed by our Bank. Our
Bank is yet to file an appeal against the judgment. The criminal complaint is currently pending.

Civil disciplinary proceedings

1. Ms. Geetha Ramachandran filed a civil suit (O.S. 937/2013) before the Subordinate Judge’s Court - II, Thrissur
against our Bank in relation to the disciplinary action and subsequent allegedly wrongful termination of her
services in 2006. Ms. Geetha Ramachandran had earlier filed a complaint before the Kerala State Women’s
Commission in December 2007, against the disciplinary action which had been taken by our Bank, and the
Commission had, pursuant to an order dated November 1, 2008, directed our Bank to reinstate Ms. Geetha
Ramachandran. Against this direction, a writ petition (WP(C) No. 1498 of 2009) was filed before the High Court
of Kerala, and the order of the Commission was set aside on May 24, 2010 on account of lack of jurisdiction.

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 Ms. Geetha Ramachandran has now filed this civil suit, and sought a direction for re-instatement and payment of
damages of ` 3.56 million along with interest at the rate of 9% p.a. for loss of salary and allowance, loss of
provident fund and gratuity benefits and mental agony, defamation as well as litigation costs. Alternatively, in
case it is declared that she is entitled to pension and not provident fund benefits, then arrears of pension from
April 1, 2013 should be paid. Our Bank has submitted a written statement on January 15, 2014. The matter is
currently pending. Ms. Geetha Ramachandran has also filed a criminal miscellaneous petition (Cri. Misc. No.
611/2014) against the part-time Chairman of our Bank before the Chief Judicial Magistrate, Thrissur. For details
see the section titled “- Litigations involving the Directors of our Bank – Outstanding litigation against our
Directors” on page 328.

2. Mr. M.A. Jose filed an indigent original petition (I.O.P. 1/2014) before the Subordinate Court, Kannur, against
our Bank and certain employees of our Bank in relation to his dismissal from service on account of acts of
misconduct. The plaintiff has sought compensation of ` 6.68 million, along with interest at the rate of 10% p.a.
for loss of salary, leave salary, provident fund contribution, loss of pension and for mental agony, as well as the
litigation costs. The matter is currently pending.

3. Mr. P.V. Paul filed a petition (W.P. (C) No. 29878/2014) dated November 11, 2014 before the High Court of
Kerala at Ernakulam, against our Bank and certain officials of our Bank in relation to his allegedly wrongful
dismissal from service. The petitioner has sought a direction to our Bank to consider and dispose of the appeal
filed before the General Manager of our Bank against the order for dismissal from service. A counter affidavit
was submitted by the Additional General Manager (Operations) of our Bank on February 23, 2015. The matter is
currently pending.

4. Mr. T.P. Varghese filed a petition (W.P.(C) No. 32785/2014) dated December 2, 2014 before the High Court of
Kerala at Ernakulam, against the ALC, Kochi and our Bank in relation to his allegedly wrongful dismissal from
service. Our Bank had ordered the dismissal from service and initiated criminal action against the plaintiff for
theft of ornaments under custody at the Nellore Branch, which was subsequently dismissed by the Court of
Judicial Magistrate, First Class, Nellore on December 13, 2010. The petitioner subsequently filed an application
before the ALC, Kochi, under the Industrial Disputes Act on November 11, 2013. The ALC, Kochi, pursuant to
an order dated October 15, 2014, directed for the matter to be transferred before the Assistant Labour
Commissioner (Central), Vijayawada (“ALC, Vijayawada”). A notice to appear before the ALC, Vijayawada
on November 24, 2014 was issued on November 6, 2014, which was allegedly received by the petitioner on
November 29, 2014. The petitioner has sought a writ of certiorari vide a petition dated December 2, 2014, calling
for records leading to the issuance of the order of ALC, Kochi directing the transfer to the ALC, Vijayawada,
and the notice to appear, and a direction to quash the order and notice, respectively. He has also sought a writ of
mandamus for a direction to our Bank to complete the conciliation proceedings before the ALC, Kochi within
two months of the plaint and for award of the costs of the petition. Pursuant to an order dated December 8, 2014,
the High Court stayed the notice to appear before the ALC, Vijayawada for one month. The matter is currently
pending.

Mr. T.P. Varghese had also filed a civil suit before the Principal Sub Court, Thrissur, claiming compensation of
an amount of ` 5 million from our Bank for malicious prosecution. However, pursuant to an order dated January
25, 2012, the suit was returned on account of being barred by limitation. Against the afore-mentioned order, Mr.
Varghese filed O.P 809/12 before the High Court of Kerala, wherein the High Court directed the trial court to
hear and dispose of the petition, if any, filed by the petitioner. Consequently, Mr. Varghese filed C.M.P. 7/12
dated January 24, 2012 before the Principal Sub Court, Thrissur, claiming compensation of ` 5 million as
damages with interest at the rate of 12% from the date of the suit to the date of realization along with costs of the
suit. Further to an objection filed by our Bank on July 26, 2012 C.M.P. 7/12 was rejected by the trial court on
account of being barred by limition. Subsequently, Mr. Varghese filed an appeal (F.A.O. 36 of 2014) before the
High Court of Kerala at Ernakulam on February 2, 2014, which is currently pending.

Other civil proceedings

1. Mr. I.V. Devies filed a civil suit (O.S. 4950/2013) before the Munsiff Court, Thrissur, against our Bank for the
alleged non-payment of pension post his dismissal from service on account of acts of misconduct, and stated that
he was entitled to pension as he had remitted the amount required to avail the option under the CSB Employees’

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 (Pension) Regulations, 1993, as amended. He has sought for a direction to our Bank to pay the pension allegedly
due to him, or alternatively refund the amount of ` 90,720 paid by him for availing the pension, along with
interest at the rate of 12% p.a. from October 2010, along with costs of the litigation. Our Bank submitted a
written statement on October 20, 2014. The matter is currently pending.

2. Mr. M.D. Johnson filed a civil suit (O.S. 546/2013) dated March 25, 2013 before the Subordinate Court,
Thrissur, against our Bank for the non-furnishing of details, and non-payment of, pension to which the plaintiff
was allegedly entitled under a pension scheme initiated by our Bank under the Indian Banks’ Association regime
for voluntary retirement. The plaintiff sought a direction to our Bank to furnish information regarding the
amount of pension which would be remitted to him and to pay the litigation costs to the plaintiff. Our Bank
submitted a written statement on July 22, 2013. The matter is currently pending.

3. Mr. Baby Joseph Alappat filed a civil suit (O.S. 547/2013) dated March 25, 2013 before the Subordinate Court,
Thrissur, against our Bank for the non-furnishing of details, and non-payment of, pension to which the plaintiff
was allegedly entitled under a pension scheme initiated by our Bank under the Indian Banks’ Association regime
for voluntary retirement. The plaintiff sought a direction to our Bank to furnish information regarding the
amount of pension which would be remitted to him and to pay the litigation costs to the plaintiff. Our Bank
submitted a written statement on July 22, 2013. The matter is currently pending.

4. Mr. John Davis Thottan filed a civil suit (O.S. 548/2013) dated March 25, 2013 before the Subordinate Court,
Thrissur, against our Bank for the non-furnishing of details, and non-payment of, pension to which the plaintiff
was allegedly entitled under a pension scheme initiated by our Bank under the Indian Banks’ Association regime
for voluntary retirement. The plaintiff sought a direction to our Bank to furnish information regarding the
amount of pension which would be remitted to him and to pay the litigation costs to the plaintiff. Our Bank
submitted a written statement on July 19, 2013. The matter is currently pending.

5. Mr. Jose Kavalakkat filed a civil suit (O.S. 549/2013) dated March 25, 2013 before the Subordinate Court,
Thrissur, against our Bank for the non-furnishing of details, and non-payment of, pension to which the plaintiff
was allegedly entitled under a pension scheme initiated by our Bank under the Indian Banks’ Association regime
for voluntary retirement. The plaintiff sought a direction to our Bank to furnish information regarding the
amount of pension which would be remitted to him and to pay the litigation costs to the plaintiff. Our Bank
submitted a written statement on July 22, 2013. The matter is currently pending.

6. Mr. P.K. Jose filed a writ petition dated June 26, 2007 before the High Court of Kerala at Ernakulam against the
Union of India, RBI, Indian Bankers’ Association, our Bank and the chairman of our Bank at that time,
challenging the constitutionality of letter dated November 26, 1998 issued by the Ministry of Finance. The
petitioner’s contention was that the said letter granted ex-gratia payment to those persons who retired from
service on or before December 31, 1985 after completing 20 years of service, whereas denied ex-gratia payment
to those who resigned from service on or before December 31, 1985 after completing 20 years of continuous
service. The matter is currently pending.

7. Resigned Bank Employees’ Welfare Association (“RBEW Association”) filed a petition (W.P.(C) 7413/2011)
dated March 23, 2011 before the High Court of Delhi, against the Ministry of Finance, Indian Banks’
Association and certain banks, including our Bank, in relation to benefits under a settlement in the form of a
memorandum of understanding dated October 29, 1993 entered into between the Indian Banks’ Association and
unions of certain nationalised and private sector banks, the Bank Employees’ Pension Regulations, 1995 and a
settlement dated April 27, 2010 between United Forum of Bank Employees Unions and Indian Banks’
Association, allowing certain benefits which were allegedly not made available to employees of the banks who
had resigned on the same terms as employees in service of the banks or employees who had retired under the
voluntary retirement scheme or the golden handshake scheme. The RBEW Association sought a direction to the
respondents to give the benefit of the settlement dated April 27, 2010 to the resignees who ceased to be in
service on or after September 29, 1995 in case of nationalised banks after rendering service for a minimum
period of 15 years, a direction to the respondents to give option of pension to the resignees and pay the litigation
costs. The matter is currently pending.

Writ petitions filed by labour unions

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1. The Catholic Syrian Bank Officers Association (“CSB Officers Association”) filed a writ petition (W.P. No.
8118/2011) before the High Court of Judicature at Madras against the Union of India, Central Board of Direct
Taxes (“CBDT”), Chief Commissioner of Income Tax and our Bank. The CSB Officers Association prayed for
a writ quashing the letter (S/1845/2011) wherein our Bank disallowed the request of the CSB Officers
Association to not deduct tax at source, and to retrain our Bank from deducting tax in relation to the amount that
was being appropriated towards the pension fund corpus of our Bank out of the salary and arrears of salary paid
by our Bank to the members of CSB Officers Association. The High Court passed an interim order dated June
24, 2011, restraining our Bank from deducting tax at source, and if already deducted, to not disburse the same to
the petitioners. The matter is currently pending.

2. The Catholic Syrian Bank Staff Federation (“CSB Staff Federation”) filed a writ petition (W.P. (C) No 10499
of 2011) dated March 31, 2011 before the High Court of Kerala at Ernakulam, against the Union of India;
Secretary to Government, Ministry of Finance and our Bank. The CSB Staff Federation prayed for a writ
declaring that the amount appropriated towards the pension fund corpus of our Bank from arrears of salary due
to employees is not “salary” under the Income Tax Act and is therefore, not taxable, and a direction prohibiting
our Bank from deducting tax at source on the pension corpus fund that was being appropriated. The High Court
passed an interim order dated April 7, 2011, restraining our Bank from deducting tax at source, and if already
deducted, to not disburse the same to the petitioners. The matter is currently pending.

3. The CSB Officers Association filed a writ petition (W.P. No. 10052 of 2008) dated April 16, 2008 before the
High Court of Judicature at Madras against the Union of India, CBDT, Chief Commissioner of Income Tax and
our Bank. The CSB Officers Association challenged the validity of the amendment to Section 17(2) of Income
Tax Act, as amended by Finance Act, 2007, and the circular issued by our Bank pursuant to the which the rent-
free allowance offered to employees was made taxable. Pursuant to an interim application filed by the CSB
Officers Association, the High Court through an order dated March 4, 2008 granted an interim injunction
restraining our Bank from collecting levying or deducting tax from the petitioners. The matter is currently
pending.

4. The Catholic Syrian Bank Officers Federation (“CSB Officers Federation”) filed a writ petition (W.P. No.
4529/2010) before the High Court of Judicature at Madras against the Union of India, CBDT, Chief
Commissioner of Income Tax and our Bank. The CSB Officers Association challenged the validity of the
amendment to Section 17(2) of Income Tax Act, as amended by Finance Act, 2007, and the circular issued by
our Bank pursuant to the same whereby the rent-free allowance offered to employees was made taxable.
Pursuant to an interim application filed by the CSB Officers Association, the High Court through an order dated
April 23, 2008 and following its order in M.P. No. 1 of 2009 in W.P. No. 4775 of 2009, gave an interim
direction to the respondents to extend the benefit to the petitioner. The matter is currently pending.

5. The Catholic Syrian Bank Executives Forum (“CSB Executives Forum”) filed a writ petition (W.P. No.
5888/2011) before the High Court of Judicature at Madras against the Union of India, CBDT, Chief
Commissioner of Income Tax and our Bank. The CSB Executives Forum challenged the validity of the
amendment to Section 17(2) of Income Tax Act as amended by Finance Act, 2007 and the circular issued by
our Bank pursuant to which the rent-free allowance offered to employees was made taxable. The matter is
currently pending.

6. The CSB Officers Federation filed a writ petition (W.P. No. 5154/2010) before the High Court of Judicature at
Madras against the Union of India, CBDT, Chief Commissioner of Income Tax and our Bank. The CSB
Officers Federation prayed for a writ declaring Rule 3(7)(i) of the Income Tax Rules and a part of the circular
issued by our Bank pursuant to the Income Tax Rules, relating to the taxability of concessional loans, and the
amendment to Rule 3(7)(i) which required interest rate on concessional loans to be charged at the rate charged
by State Bank of India, are null and void. Pursuant to an interim application filed by the petitioner, the High
Court passed an interim order dated March 15, 2010 restraining our Bank from levying, collecting or deducting
tax at source. The matter is currently pending.

7. The CSB Staff Federation filed a writ petition (W.P. No. 5885/2011) before the High Court of Judicature at
Madras against the Union of India, CBDT, Chief Commissioner of Income Tax and our Bank. The CSB Staff

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 Federation prayed for a writ declaring Rule 3(7)(i) of the Income Tax Rules and a part of the circular issued by
our Bank pursuant to the Income Tax Rules, relating to the taxability of concessional loans, and the amendment
to Rule 3(7)(i) which required interest rate on concessional loans to be charged at the rate charged by State
Bank of India, are ultra vires the Income Tax Act, unconstitutional, and therefore null and void. Pursuant to an
interim application filed by the petitioner, the High Court passed an interim order dated March 9, 2011
restraining our Bank from levying, collecting or deducting tax at source. The matter is currently pending.

8. The CSB Officers Federation filed a writ petition (W.P. No. 4528/2010) before the High Court of Judicature at
Madras against the Union of India, CBDT, Chief Commissioner of Income Tax and our Bank. The CSB
Officers Federation prayed for a writ declaring Rule 3(7)(i) of the Income Tax Rules and a part of the circular
issued by our Bank pursuant to the Income Tax Rules, relating to the taxability of concessional loans, and the
amendment to Rule 3(7)(i) which required interest rate on concessional loans to be charged at the rate charged
by State Bank of India, are ultra vires the Income Tax Act, unconstitutional, and therefore null and void.
Pursuant to an interim application filed by the CSB Officers Association, the High Court through an order dated
March 4, 2008 and following its order in M.P. No. 1 of 2009 in W.P. No. 4775/2009 gave interim direction to
the respondents to extend the benefit to the petitioner therein. The matter is currently pending.

9. The CSB Executives Forum filed a writ petition (W.P. No. 5889/2010) before the High Court of Judicature at
Madras against the Union of India, CBDT, Chief Commissioner of Income Tax and our Bank. The CSB
Executives Forum prayed for a writ declaring Rule 3(7)(i) of the Income Tax Rules and a part of the circular
issued by our Bank pursuant to the Income Tax Rules, relating to the taxability of concessional loans, and the
amendment to Rule 3(7)(i) which required interest rate on concessional loans to be charged at the rate charged
by State Bank of India, are ultra vires the Income Tax Act, unconstitutional, and therefore null and void. The
matter is currently pending.

Tax proceedings

Direct tax matters

Appeals by the Income Tax Department

1. Our Bank received an assessment order and demand notice dated January 24, 2005 from the Assistant
Commissioner of Income Tax, Circle 1(1), Trichur (“ACIT”) with respect to assessment year (“AY”) 2002-03.
Pursuant to the order, certain deductions claimed by our Bank including inter alia deduction of interest on tax
free bonds and dividend income, bad debt claims, written off debts, were disallowed. Our Bank filed an appeal
before the Commissioner of Income Tax (Appeals), Trichur (“CIT (A)”) which was partly allowed through an
order dated April 7, 2006. Subsequently, our Bank filed an appeal before the ITAT against the disallowance of
` 8.59 million towards interest on tax-free bonds and dividend income. The CIT filed an appeal before the ITAT
against the deduction of ` 126.60 million allowed by the CIT (A). The ITAT through an order dated April 16,
2007 allowed our Bank’s claim and dismissed that of the CIT. Against the deduction of ` 8.59 million allowed
by the ITAT, the CIT filed an appeal before the High Court of Kerala at Ernakulam, which was allowed through
an order dated November 22, 2010. Our Bank has filed a special leave petition dated February 28, 2011,
challenging the order of the High Court on the disallowance.

Pursuant to the direction issued by the Commissioner of Income Tax, Trichur (“CIT”) to the ACIT, the ACIT
passed a revised assessment order dated December 10, 2007. Against the revised assessment order, our Bank
filed another appeal before the Income Tax Appellate Tribunal, Cochin (“ITAT”) against inter-alia the
disallowance of deduction of ` 14.58 million towards lease equalization charges, and ` 7.89 million as loss on
revaluation of unquoted securities. The ITAT pursuant to an order dated August 6, 2009 allowed the aforesaid
two deductions claimed by our Bank. Subsequently, a revised assessment order dated March 19, 2010 was
issued by the ACIT in order to give effect to the order dated August 6, 2009 of the ITAT. Thereafter, the CIT
filed an appeal on January 4, 2010 before the High Court of Kerala at Ernakulum, against the order dated
August 6, 2009 with respect to the above-mentioned two deductions allowed by the ITAT. In relation to the
deduction of ` 126.60 million for bad debts, the CIT preferred several appeals before the High Court against
orders of the ITAT allowing the said deduction. The High Court through its order dated December 16, 2009
allowed the appeal of the CIT. Against the said order of the High Court, our Bank preferred an appeal before the

266
 Supreme Court of India. The Supreme Court through its order dated February 17, 2012 allowed our Bank’s
claim for deduction towards provision for bad debts and directed the assessing officer to re-compute the taxable
income. Pursuant to the said order, the ACIT issued a revised assessment order dated March 30, 2012 giving
effect to the order of the Supreme Court.

Furthermore, our Bank received a notice dated February 28, 2003 under Section 143(1) of the Income Tax Act
with respect to AY 2002-03, denying the payment of interest under Section 244A of the said Act on refund of `
49.92 million. Against the same, our Bank filed an appeal before the CIT (A), which was dismissed through an
order dated June 14, 2004. Thereafter, our Bank filed an appeal before the ITAT. The ITAT through an order
dated July 28, 2006 allowed our appeal. Against the said order of the ITAT, the CIT has filed an appeal before
the High Court.The matters are currently pending.

2. Our Bank received an assessment order and demand notice dated November 30, 1992 from the ACIT with
respect to AY 1990-91. Pursuant to the order, certain deductions claimed by our Bank including inter-alia bad
debt claims, penal interest paid to RBI, travelling expenses, were disallowed. Our Bank filed an appeal before
the CIT (A), which was partly allowed through an order dated February 26, 1993. Thereafter, the CIT filed an
appeal before the ITAT, against inter-alia: a) deduction of ` 0.53 million allowed towards penal interest paid to
RBI, b) deduction of ` 12.36 million allowed towards bad debts written off, c) deduction of ` 8.15 million
allowed as provision for bad debts while computing book profits. The ITAT through an order dated February
14, 2003 allowed the first two above-mentioned deductions and in relation to the third deduction directed the
assessing officer to recomputed the book profit and a deduction towards provision made for bad debts was
permissible. The CIT has filed an appeal dated June 19, 2003 against our Bank before the High Court of Kerala
at Ernakulam, challenging the order passed by the ITAT in relation to the afore-mentioned three deductions. In
relation to the claim of deduction for provision for bad debts, the CIT preferred several appeals before the High
Court against orders of the ITAT allowing the said deduction. The High Court through its order dated December
16, 2009 allowed the appeal of the CIT. Against the said order of the High Court, our Bank preferred an appeal
before the Supreme Court of India. The Supreme Court through its order dated February 17, 2012 allowed our
Bank’s claim for deduction towards provision for bad debts and directed the assessing officer to re-compute the
taxable income. Pursuant to the said order, the ACIT issued a revised assessment order dated March 29, 2012
giving effect to the order of the Supreme Court. The matter is currently pending with respect to the other two
deductions claimed by our Bank.

3. Our Bank received an assessment order dated January 31, 1994 and demand notice dated February 11, 1994
from the ACIT with respect to AY 1992-93. Pursuant to the order, certain deductions claimed by our Bank
including inter-alia bad debts written off, business promotion expenses, depreciation of government securities,
were disallowed. Our Bank filed an appeal before the CIT, which was partly allowed through an order dated
March 30, 1994. The CIT filed an appeal before the ITAT, against inter-alia, the deduction of ` 3.53 million
allowed towards written off bad debts, and the deduction of ` 35.84 million allowed as depreciation in the value
of government securities. The ITAT through an order dated February 14, 2003 dismissed the claim of the CIT in
relation to the said deduction of ` 35.84 million. With respect to the deduction of ` 3.53 million, the ITAT
ordered the assessing officer to redo the assessment in consonance with the order dated August 9, 2002 passed
by the special bench of the ITAT holding that bad debts actually written off and which do not arise out of rural
advances are not limited by Section 36(1)(vii) of the Income Tax Act. The CIT has filed an appeal dated June
19, 2003 before the High Court of Kerala at Ernakulam against the order passed by the ITAT in relation to the
afore-mentioned two deductions. In relation to the claim of deduction for bad debts, the CIT preferred several
appeals before the High Court against orders of the ITAT allowing the said deduction. The High Court through
its order dated December 16, 2009 allowed the appeal of the CIT. Against the said order of the High Court, our
Bank preferred an appeal before the Supreme Court of India. The Supreme Court through its order dated
February 17, 2012 allowed our Bank’s claim for deduction towards provision for bad debts and directed the
assessing officer to re-compute the taxable income. Pursuant to the said order, the ACIT issued a revised
assessment order dated March 30, 2012 giving effect to the order of the Supreme Court. The matter is currently
pending with respect to the other two deductions claimed by our Bank.

Furthermore, the ACIT through the said assessment order dated March 30, 2012 allowed interest of ` 3.88
million under Section 244A of the Income Tax Act on refund due to us. Thereafter, the ACIT issued a notice
dated December 26, 2012 proposing to withdraw excess interest granted under Section 244 A. Our Bank has

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 filed reply dated January 14, 2013 stating that we are eligible for payment of more interest. The matter is
currently pending.

4. Our Bank received an assessment order and demand notice dated March 19, 1999 from the ACIT with respect
to AY 1996-97. Pursuant to an appeal filed by our Bank before the CIT (A), the assessment was revised and our
Bank received another assessment order and demand notice dated March 28, 2002. Certain deductions claimed
by our Bank including inter-alia depreciation on investments, amortization on premium paid on permanent
securities, broken period interest, excess interest tax collected by our Bank, were disallowed. Our Bank filed an
appeal before the CIT (A), which was partly allowed through order dated November 10, 2003. Our Bank filed
an appeal before the ITAT, against inter-alia the following deductions: a) ` 0.28 million towards amortization
of premium paid on permanent category of investments, b) ` 1.92 million towards broken period interest, c) `
3.01 million of excess interest tax collected by our Bank. The ITAT allowed the first two deductions claimed by
our Bank and disallowed deduction of ` 3.01 million through an order dated August 8, 2007. Subsequently, the
CIT filed an appeal before the High Court of Kerala at Ernakulam, against the two deductions allowed by the
ITAT, which was dismissed through an order dated August 12, 2009. Against the said order, the CIT has filed a
special leave petition dated January 21, 2011 before the Supreme Court of India, against the said deductions
allowed by the High Court. In relation to the deduction of ` 3.01 million that was disallowed by the ITAT, our
Bank filed an appeal before the High Court, that was dismissed through an order dated March 22, 2011.
Thereafter, our Bank has filed a review petition dated July 18, 2011 before the High Court, against the order
dated March 22, 2011. The review petition was dismissed by the High Court on November 17, 2014. Our Bank
filed a special leave petition dated February 16, 2015 before the Supreme Court challenging the dismissal of the
review petition. The said petition was dismissed by an order dated March 9, 2015. The matter is currently
pending in relation to the special leave petition preferred by the CIT.

5. Pursuant to a revision of the original assessment dated January 28, 2004, our Bank received a revised
assessment order and demand notice dated December 18, 2006 from the ACIT with respect to AY 1999-2000.
Pursuant to the order, certain deductions claimed by our Bank including inter-alia lease equalization charges,
pension contribution fund, amortization of premium on permanent investments, were disallowed. Our Bank
filed an appeal before the CIT (A), which was partly allowed through an order dated September 11, 2007.
Thereafter, our Bank filed an appeal before the ITAT, against the disallowance of: a) ` 7 million towards claim
of pension contribution fund, b) ` 17.28 million towards lease equalization charges. The ITAT through an order
dated June 30, 2009 allowed our claims with respect to the afore-mentioned two deductions. Thereafter, the CIT
filed an appeal dated November 12, 2009 against our Bank before the High Court of Kerala at Ernakulam,
against the aforesaid two deductions allowed by the ITAT. The matter is currently pending.

6. Pursuant to a revision of the original assessment dated January 28, 2004, our Bank received a revised
assessment order and demand notice dated December 18, 2006 from the ACIT with respect to AY 1999-2000.
Pursuant to the order, certain deductions claimed by our Bank including inter-alia broken period interest, lease
equalization charges, bad debts claims, were disallowed. Our Bank filed an appeal before the CIT (A) which
was partly allowed through an order dated June 14, 2004. Thereafter, our Bank filed an appeal before the ITAT,
against the disallowance of ` 86.15 million towards provision for bad debts while calculating book profit. The
ITAT through an order dated June 30, 2009, allowed our claim. Subsequently, the CIT has filed an appeal dated
November 12, 2009 against our Bank before the High Court of Kerala at Ernakulam, challenging the order
passed by the ITAT, Cochin, allowing the said deduction of ` 86.15 million. The matter is currently pending.

7. Our Bank received an assessment order and demand notice dated September 30, 2002 from the ACIT with
respect to AY 2000-01. Pursuant to the order, certain deductions claimed by our Bank including inter-alia
broken period interest, bad debts written off, were disallowed. Our Bank filed an appeal before the CIT(A),
which was partly allowed through an order dated November 10, 2003. The CIT filed an appeal before the ITAT,
against inter-alia: a) deduction of ` 7.67 million allowed towards broken period interest, b) deduction of `
33.27 million allowed towards bad debts written off. The ITAT upheld the said deductions through an order
dated November 29, 2006. Thereafter, the CIT has filed an appeal dated April 10, 2007 against our Bank before
the High Court of Kerala at Ernakulam, challenging the order passed by the ITAT, allowing the aforesaid two
deductions. The matter is currently pending. In relation to the claim of deduction for bad debts, the CIT
preferred several appeals before the High Court against orders of the ITAT allowing the said deduction. The
High Court through its order dated December 16, 2009 allowed the appeal of the CIT. Against the said order of

268
 the High Court, our Bank preferred an appeal before the Supreme Court of India. The Supreme Court through
its order dated February 17, 2012 allowed our Bank’s claim for deduction towards provision for bad debts and
directed the assessing officer to re-compute the taxable income. Pursuant to the said order, the ACIT issued a
revised assessment order dated March 30, 2012 giving effect to the order of the Supreme Court. The matter is
currently pending with respect to the other two deductions claimed by our Bank.

8. Our Bank received a revised assessment order and demand notice from the ACIT dated December 18, 2006
with respect to AY 2000-01. Pursuant to the order, certain deductions claimed by our Bank including inter-alia
lease equalization charges, expenditure in earning tax-free income, depreciation on revaluation of investments,
loss on amortization on permanent securities, were disallowed. Our Bank filed an appeal before the CIT (A),
which was partly allowed through an order dated October 29, 2007. Thereafter, our Bank filed an appeal before
the ITAT, against inter-alia the disallowance of lease equalization charges of ` 26.54 million, and the CIT filed
an appeal before the ITAT against inter-alia the deduction of ` 0.05 million towards loss on amortization on
securities. The ITAT through an order dated August 6, 2009 allowed our claim and disallowed the appeal filed
by the CIT. Subsequently, the CIT filed two appeals dated January 5, 2010 before the High Court of Kerala at
Ernakulam, challenging the ITAT order, against the allowance of deductions of ` 26.54 million and ` 0.05
million respectively. Furthermore, in relation to the said AY, our Bank filed an appeal before the ITAT against
the disallowance of ` 13.44 million towards expenditure incurred in earning tax-free income. The ITAT through
its order dated November 29, 2006 allowed the said appeal. The CIT filed an appeal against the order of the
ITAT before the High Court. The High Court through its order dated October 21, 2010, in principle upheld the
disallowance and restored the matter to the assessing officer to reasonably estimate the expenditure incurred on
earning tax-free income. Thereafter, our Bank has filed a special leave petition dated February 28, 2011 before
the Supreme Court of India, challenging the said order passed by the High Court. The matters are currently
pending.

9. Our Bank received an assessment order and demand notice dated September 30, 2002 from the ACIT with
respect to AY 2001-02. Pursuant to the order, certain deductions claimed by our Bank including inter-alia
broken period interest, bad debts written off, were disallowed. Our Bank filed an appeal before the CIT (A),
which was partly allowed through an order dated November 10, 2003. Subsequently, the CIT filed an appeal
before the ITAT, against inter-alia the following deductions: a) deduction of ` 52.34 million allowed towards
interest for the broken period paid at the time of purchase of securities, b) deduction of ` 106.10 million
towards bad debts written off. The ITAT through an order dated February 23, 2006 dismissed the appeal of the
CIT. Thereafter, the CIT has filed an appeal dated June 29, 2006 against our Bank before the High Court of
Kerala at Ernakulam, challenging the order passed by the ITAT. In relation to the claim of deduction for bad
debts, the CIT preferred several appeals before the High Court against orders of the ITAT allowing the said
deduction. The High Court through its order dated December 16, 2009 allowed the appeal of the CIT. Against
the said order of the High Court, our Bank preferred an appeal before the Supreme Court of India. The Supreme
Court through its order dated February 17, 2012 allowed our Bank’s claim for deduction towards provision for
bad debts and directed the assessing officer to re-compute the taxable income. Pursuant to the said order, the
ACIT issued a revised assessment order dated March 30, 2012 giving effect to the order of the Supreme Court.
The matter is currently pending with respect to the other deduction claimed by our Bank.

10. Our Bank received an assessment order and demand notice dated December 15, 2006 from the ACIT with
respect to AY 2001-02. Pursuant to the order, certain deductions claimed by our Bank including inter-alia claim
of depreciation/ loss on revaluation of unquoted shares, lease equalization charges, writing off of investments,
were disallowed. Our Bank filed an appeal before the CIT (A) which was partly allowed through an order dated
October 29, 2007. Thereafter, our Bank filed an appeal before the ITAT, against inter-alia the disallowance of `
27.40 million allowed towards lease equalization charges and disallowance of ` 30.50 million towards
investments written off. The CIT filed an appeal before the ITAT, against inter-alia the deduction of ` 7.46
million allowed towards loss on revaluation of unquoted securities, the cancellation of the payment of interest
of ` 0.03 million by our Bank under Section 234C, Income Tax Act. The ITAT through an order dated August
6, 2009 allowed our claims and disallowed the aforesaid two claims of the CIT. The CIT has filed two appeals
dated January 5, 2010 before the High Court of Kerala at Ernakulam, challenging the order dated August 6,
2009 with respect to the afore-mentioned deductions allowed. Furthermore, our Bank had filed another appeal
before the ITAT claiming deduction of ` 11.41 million towards expenditure incurred in earning tax-free income
in relation to AY 2001-02. The ITAT through its order dated November 29, 2006 allowed the said appeal. The

269
 CIT filed an appeal before the High Court which through its order dated October 21, 2010, upheld the
disallowance of ` 11.41 million in principle. Thereafter, our Bank has filed a special leave petition dated
February 28, 2011 before the Supreme Court of India, challenging the order passed by the High Court. The
matters are currently pending.

11. Our Bank received an assessment order and demand notice dated March 28, 2006 from the ACIT with respect
to AY 2003-04. Pursuant to the order, certain deductions claimed by our Bank including inter-alia bad debts
claims, lease equalization charges, appreciation/ depreciation of investments, payment of pension to retired
employees, and loss on amortization on permanent securities were disallowed. Our Bank filed an appeal before
the Commissioner of Income Tax (Appeals), Cochin (“CIT (A)”) against the said assessment order, which was
partly allowed pursuant to an order dated March 19, 2007. Subsequently, our Bank filed an appeal before the
ITAT against inter-alia the disallowance of lease equalization charges of ` 11.32 million. The CIT filed an
appeal before the ITAT against inter-alia a) deduction of ` 121.93 million allowed towards bad debts written
off in excess under Section 36(1)(vii) of the Income Tax Act, b) deletion of the addition of ` 14.11 million
made by the assessing officer towards appreciation in value of securities, c) deduction of ` 18 million allowed
towards depreciation in value of securities, d) deduction of ` 0.66 million allowed towards loss on amortization
on permanent securities. The ITAT through an order dated August 6, 2009 allowed our Bank’s appeal in
relation to the deduction of ` 11.32 million and disallowed the claim of the CIT in relation to the aforesaid four
deductions. Thereafter, the CIT filed two appeals dated January 4, 2010 against our Bank before the High Court
of Kerala at Ernakulam, against the order dated August 6, 2009 passed by the ITAT, Cochin with respect to the
above-mentioned five deductions. The matters are currently pending.
12. Our Bank received an assessment order and demand notice dated March 28, 2006 from the ACIT with respect
to AY 2004-05. Pursuant to an order dated January 18, 2007 passed by the ACIT under Section 154 of the
Income Tax Act, the assessment was rectified. Pursuant to the said assessment orders, certain deductions
claimed by our Bank inter-alia bad debts claims, expenditure towards tax-free bonds, appreciation/ depreciation
on investments, lease equalization charges, were disallowed. Our Bank filed an appeal before the CIT (A)
which was partly allowed through an order dated July 11, 2007. Thereafter, the CIT filed an appeal before the
ITAT, challenging inter-alia the deduction of ` 7.17 million allowed towards expenditure incurred for earning
tax-free bonds. Our Bank filed an appeal before the ITAT, challenging the disallowance of ` 1.74 million
claimed towards lease equalization charges. The ITAT through an order dated August 6, 2009 allowed the
appeals of our Bank and the CIT (A) with respect to the two deductions above-mentioned. Subsequently, the
CIT filed an appeal dated January 5, 2010 before the High Court of Kerala at Ernakulam, against the deduction
allowed by the ITAT towards lease equalization charges. Further, the CIT filed another appeal dated January 5,
2010 before the High Court challenging the ITAT order in relation to the following items: a) deduction of `
201.75 million allowed towards bad debts written off, b) deletion of the addition of ` 31.28 million made by the
assessing officer towards appreciation in value of securities, c) deduction of ` 2 million allowed towards
depreciation in value of securities, d) deduction of ` 1.09 million allowed towards loss on amortization on
permanent securities, e) deduction of ` 1.74 million towards lease equalization charges. In relation to the
aforesaid disallowance of ` 7.17 million, our Bank filed an appeal before the High Court which through its
order dated October 21, 2010, upheld the said disallowance in principle. Thereafter, our Bank has filed a special
leave petition dated February 28, 2011 before the Supreme Court of India, challenging the order passed by the
High Court. The matters are currently pending.
13. Our Bank received an assessment order and dated November 17, 2009 and demand notice dated December 9,
2009 from the ACIT with respect to AY 2007-08. Pursuant to the assessment order, certain deductions claimed
by our Bank including inter-alia bad debt claims, exempt dividend income, depreciation on held to maturity
(“HTM”) category of investments, surplus on sale of jewellery, excess cash, amortization on premium on
permanent category of investments, were disallowed. Subsequently, our Bank filed an appeal before the CIT
(A) which was partly allowed through an order dated June 2, 2011. Thereafter, our Bank filed an appeal before
the ITAT against inter-alia the following disallowances: a) ` 24.65 million towards depreciation on HTM
category of investments, b) ` 2.15 million towards exempted dividend income from investment in shares, c) `
0.13 million of excess cash found in our branches, d) ` 0.39 million in relation to surplus realised on sale of
jewellery, e) ` 119.98 million towards bad debts. In relation to the deductions of ` 24.65 million and ` 119.98
million claimed by our Bank, the ITAT through an order dated March 8, 2013 directed the assessing officer to
examine the issue afresh by duly considering certain decision of the High Court and the Supreme Court. The
other three deductions claimed by our Bank were disallowed by the ITAT. The CIT and our Bank have filed

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 appeals dated August 2, 2013 and July 29, 2013 respectively before the High Court of Kerala at Ernakulam,
challenging the order passed by the ITAT. Furthermore, in relation to the deduction of ` 1.61 million claimed
by our Bank towards bad debts, our Bank received an order dated May 26, 2014 from the ACIT giving effect to
the order dated March 8, 2013 passed by the ITAT and disallowing the said deduction. Our Bank has filed an
appeal before the CIT (A), against the said disallowance. The matters are currently pending.

Appeals filed by the Bank

1. Our Bank received an assessment order and demand notice dated March 28, 2013 and March 30, 2013
respectively from the Additional Commissioner of Income Tax (“Ad.CIT”) with respect to AY 2010-11.
Pursuant to the assessment order, the Ad.CIT disallowed the following deductions claimed by our Bank: a)
`88.81 million towards bad debts written off in non-rural branches, b) ` 41.81 million towards provision for bad
and doubtful debts in rural branches, c) deletion of demand of ` 3.74 million in relation to wrongly adjusted
dividend distribution tax. Our Bank has filed an appeal dated April 25, 2013 before the CIT (A), challenging the
said assessment order. The matter is currently pending.

2. Our Bank received an intimation dated July 31, 2013 under Section 143(1) of the Income Tax Act with respect
to AY 2011-12, determining refund and interest under Section 244A of the said Act. Against the same, our
Bank has filed an appeal dated May 15, 2014 before the CIT (A). Thereafter, our Bank received an assessment
order and demand notice dated March 31, 2014 from the Income Tax Officer, Ward-1, Thrissur (“ITO”)
wherein interest under Section 244A was not allowed. In addition, the, the ITO also disallowed the following
claims of our Bank: a) deduction of ` 5.83 million - disallowed under Section 14A of the Income Tax Act, b)
dividend income of ` 1.27 million as exempted income, c) deduction of `85.46 million towards provision for
bad debts, d) ` 37.40 million towards bad debts under Section 36(1)(viii) of Income Tax Act, e) ` 30.90 million
towards bad debts written off in non- rural branches, f) ` 243.74 million of brought forward loss, g) ` 3.80
million towards TDS credit, h) refund of ` 1 million paid as advance tax, ` 31.50 million as self assessment tax
along with interest under Section 244A of the Income Tax Act. Our Bank has filed an appeal dated April 24,
2014 before the CIT (A), challenging the assessment order passed by the ITO. Subsequently, our Bank received
a revised assessment order and demand notice dated April 29, 2014 from the ITO allowing deduction to the
extent of ` 1.27 million in relation to dividend income and ` 158.32 million with respect to brought forward
losses. The matter is currently pending.

3. Our Bank received an intimation dated July 31, 2013 under Section 143(1) of the Income Tax Act with respect
to AY 2012-13. Pursuant to the same, interest of ` 5.07 million was determined to be due on refund. Against the
same, our Bank filed an appeal dated May 15, 2014 before the CIT (A), Kochi. Thereafter, our Bank received
an assessment order dated March 18, 2015 from ACIT. whereby the following deductions claimed by our Bank
were disallowed and no refund was determined to be due to us: a) ` 2.82 million towards expenditure incurred
in earning dividend income, b) ` 158.34 million towards provision for bad and doubtful debt under Section
36(1)(vii)(a) of Income Tax Act, c) ` 55.22 million towards bad debts claim under Section 36(1)(viii), d) `
132.27 million towards bad debts written off. We are in the process of filing an appeal against the said
deductions disallowed by the ACIT.

4. Our Bank received an assessment order and demand notice dated January 29, 1998 from the Deputy
Commissioner of Income Tax, Ernakulam (“DCIT”) with respect to AY 1995-96. Thereafter, the assessment
was revised on several occasions and assessment orders dated March 19, 1998, July 12, 1999, March 31, 2000,
November 17, 2004, February 17, 2009, and March 3, 2009 were issued to us. Pursuant to the order, certain
deductions claimed by our Bank including inter-alia valuation of permanent category of investments, and
dividend income from units of Unit Trust of India, were disallowed. Our Bank filed an appeal before the CIT
(A), which was allowed through an order dated September 22, 2010. Thereafter, the CIT filed an appeal before
the ITAT, against the order of the CIT(A) holding that ` 2.80 million charged as interest by the assessing officer
under Section 234D of the Income Tax Act was not applicable to the said AY. The ITAT through an order dated
July 5, 2012 directed the assessing officer to re-compute the interest under Section 234 D of the Income Tax
Act in accordance with the decision of the High Court of Kerala in 323 ITR 584. Our Bank has filed an appeal
dated November 9, 2012 before the High Court of Kerala against the said order dated July 5, 2012 of the ITAT.
The matter is currently pending.

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5. Our Bank received an assessment order and demand notice dated December 28, 2007 from the ACIT with
respect to AY 2005-06. Pursuant to the order, certain deductions claimed by our Bank including inter-alia bad
debt written off, payment of pension, lease equalization charges, amortization on premium, expenditure
incurred in earning tax-free income, excess cash received by our Bank’s branches, surplus cash received by
Bank on pledge of gold ornaments, were disallowed. Our Bank filed an appeal dated January 10, 2008 before
the CIT (A), which was partly allowed through an order dated October 14, 2008. Thereafter, our Bank filed an
appeal before the ITAT, against inter-alia the a) disallowance of ` 0.70 million as expenditure incurred in
earning tax-free income, b) the disallowance of ` 0.95 million as excess cash our branches, c) disallowance of `
2.76 million as surplus received from the pledge of gold ornaments. The said deductions claimed by us were
dismissed by the ITAT through an order dated February 11, 2011. Subsequently, our Bank filed an appeal
before the High Court of Kerala at Ernakulam. The High Court through two orders dated March 20, 2012
upheld the disallowance with respect to the aforesaid three deductions. Our Bank has thus, filed a special leave
petition dated August 16, 2012 before the Supreme Court, challenging the order of the High Court with respect
to the deductions which were disallowed. The matter is currently pending.

6. Our Bank received an assessment order and demand notice dated October 6, 2008 from the Ad.CIT, Thrissur
with respect to AY 2006-07. Pursuant to the said order, certain deductions claimed by our Bank including inter-
alia surplus cash received from pledge of gold ornaments, excess cash collected at our branches, expenditure
incurred in earning tax-free income, were disallowed. Our Bank filed an appeal dated November 10, 2008
before the CIT (A), which was partly allowed through an order dated September 22, 2010. Thereafter, our Bank
filed an appeal before the ITAT, against the disallowance of ` 0.07 million towards excess cash collected at our
branches, and the disallowance of ` 0.32 million towards expenditure incurred in earning tax-free dividend
income. The CIT filed an appeal before the ITAT, against the disallowance of ` 0.25 million towards surplus
cash received from the pledge of gold ornaments. The ITAT through its order dated July 5, 2012 dismissed the
claims of our Bank and allowed the claim of the CIT. Our Bank has thus, filed two appeals dated November 9,
2012 before the High Court of Kerala at Ernakulam, challenging the order of the ITAT against the
disallowances of aforesaid three deductions of ` 0.07 million and ` 0.32 million, 0.25 million, respectively.

Furthermore, the DCIT passed an order dated March 31, 2014 under Section 254 of Income Tax Act giving
effect to the above-mentioned ITAT order and allowing interest of ` 31.54 million on refund due to us. Against
the same, our Bank has filed an appeal dated June 9, 2014 before the CIT (A). Thereafter, our Bank received a
notice dated September 30, 2014 under Section 154 of Income Tax Act proposing withdrawal of allegedly
excess interest that had been granted to us through order dated March 31, 2014. Against the said notice, our
Bank has filed a reply dated October 23, 2014 stating that there has been a shortage in interest granted to us.
The matters are currently pending.

7. Our Bank received an assessment order and demand notice dated December 27, 2010 from the JCIT, Thrissur
with respect to AY 2008-09. Pursuant to the order, certain deductions claimed by our Bank including inter-alia
excess cash received by branches, surplus cash realised on sale of gold jewellery pledged to our Bank, expenses
incurred in earning tax-free income, unclaimed balances on overdue deposits, were disallowed. Our Bank filed
an appeal dated January 27, 2011 before the CIT(A), which was partly allowed, through an order dated
February 19, 2014. Thereafter, our Bank filed an appeal before the ITAT, against inter-alia a) disallowance of `
0.76 million in relation to expenditure incurred on tax-free income that was disallowed under Section 14A of
the Income Tax Act, b) ` 0.44 million towards excess cash received by our branches, c) ` 1.20 million towards
surplus cash received from the sale of gold jewellery. The ITAT through an order dated October 17, 2014
disallowed our claims in relation to the aforesaid three deductions. Our Bank has filed an appeal dated March 5,
2015 before the High Court of Kerala at Ernakulam, against the order of the ITAT. The matter is currently
pending.

8. Our Bank received an assessment order and demand notice dated December 23, 2011 from the JCIT, Thrissur
with respect to AY 2009-10. Pursuant to the order certain deductions, namely, payment of pension and
expenditure incurred in earning tax-free income, were disallowed. Our Bank filed an appeal dated January 2012
before the CIT (A) that was partly allowed pursuant to order dated February 19, 2014. Our Bank filed an appeal
dated June 20, 2014 before the ITAT against the disallowance of ` 0.60 million claimed towards expenses
incurred in earning tax-free income. The ITAT through an order dated October 17, 2014, disallowed the said
deduction claimed by our Bank. Our Bank has filed an appeal dated March 5, 2015 before the High Court of

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 Kerala at Ernakulam, against the afore-mentioned four disallowances by the ITAT. The matter is currently
pending.

9. Our Bank received a revised assessment order dated March 3, 2009 from the ACIT with respect to AY 1997-98
disallowing inter-alia interest under Section 244A of the Income Tax Act on refund due to our Bank. Against
the said disallowance, our Bank filed an appeal dated May 19, 2009 before the CIT (A), Thrissur. The matter is
currently pending.

10. In relation to AY 2001-02, the ACIT issued revised assessment orders on several occasions including orders
dated August 6, 2010 and November 30, 2010. Thereafter, the ACIT issued notice dated March 8, 2012 under
Section 154 of the Income Tax Act, proposing withdrawal of excess interest allowed under Section 244A of the
said Act. The matter is currently pending.

11. Our Bank received a notice dated December 26, 2012 under Section 154 of Income Tax Act proposing the
withdrawal of excess interest under Section 244 A of Income Tax Act and credit of minimum alternate tax
(“MAT”) of ` 3.71 granted to us from ACIT in relation to AY 2000-01. Against the same, we filed a reply
dated January 14, 2013 stating that interest and credit of MAT should be allowed as per law. Subsequently, in
relation to interest under Section 244A, we received a revised assessment order dated June 11, 2014 allowing
interest of ` 26.07 million only on refund due to us. Our Bank has filed an appeal dated September 15, 2014
against the said assessment order claiming that the calculation interest by the assessing officer is erroneous. The
matter is currently pending.

12. Our Bank’s branch office at Mananthavady, Kozhikode received a TRACES intimation dated June 8, 2014
under Section 200A of the Income Tax Act from DCIT, Central Processing Cell- TDS, imposing late filing fees
of ` 0.10 million for the alleged late filing of TDS statement for the third quarter of financial year 2012-13. Our
Bank has filed an appeal dated July 19, 2014 before the CIT (A), Kochi for the deletion of the said demand as
the late filing was not deliberate. Further, we have also filed a petition for condonation of delay in filing the
appeal. The matter is currently pending.

13. Our Bank’s branch office at Kalyan branch received a notice dated January 21, 2013 from Additional
Commissionr of Income Tax, Thane asking us to show cause as to why penalty should not be imposed under
Section 272(A)(k) of Income Tax Act for delay in submitting TDS statement for the fourth quarter of financial
year 2009-10. Our Bank filed a reply dated February 7, 2013, stating that it was due to an inadvertent error on
the part of its staff. Thereafter, the ACIT passed an order dated May 10, 2013 imposing a penalty of ` 0.03
million. Subsequently, our Bank filed an appeal dated June 20, 2013 against the said order, stating that the error
was inadvertent and that we have showed reasonable cause. Further, our Bank also filed a petition dated June
20, 2013 before the CIT, Thane for waiver of penalty imposed. The matter is currently pending.

14. Pursuant to spot inspections conducted at our Patturaikkal branch, the ITO (TDS) issued orders dated August
12, 2013, July 19, 2013, and August 12, 2013, for AY 2010-11, 2011-12, and 2012-13, respectively, under
Section 201(1) and 201(1A) of Income Tax Act, demanding ` 2.77 million towards tax deductible at source as
the 15G/H forms maintained by our Bank were improper. The ITO has also sought the payment of interest
payable on such tax. The matter is currently pending.

15. Pursuant to spot inspections conducted at our Kurumpilavu branch, the ITO (TDS) issued orders dated July 23,
2013, July 23, 2013, July 23, 2013, and July 23, 2013 for AY 2010-11, 2011-12, and 2012-13, and AY 2013-14
respectively, under Section 201(1) and 201(1A) of Income Tax Act, demanding of ` 4.92 million towards tax
deductible at source as the 15G/H forms maintained by our Bank were improper. The ITO also sought the
payment of interest on such tax. Subsequently, our Bank received four revised assessment orders dated
February 7, 2014, demanding an aggregate sum of ` 0.51 million for the aforementioned assessment years.
Against the orders dated February 7, 2014, we have filed four appeals dated March 14, 2014 before the CIT (A).
The matter is currently pending.

Pending Tax Notices against our Bank

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1. Our Bank has received a TRACES TDS Reconciliation Analysis and Correction Enabling System
(“TRACES”) notice dated November 28, 2014 from DCIT, Central Processing Cell- TDS in relation to the
following consolidated defaults of various Tax Deduction Account Numbers (“TAN”) belonging to us as on
October 23, 2014 from FY 2007: a) short deduction (including interest) of ` 46.08 million, b) short payment
(including interest) of ` 46.80 million, c) late payment interest of ` 3.16 million, d) late deduction interest of `
0.1 million, e) other interest of ` 469.50, f) late filing fee of ` 4.34 million, aggregating to a total demand of `
100.47 million.

2. In relation to AY 2001-02, the ACIT issued a notice dated March 8, 2012 under Section 154 of the Income Tax
Act to our Bank, proposing withdrawal of excess interest allowed under Section 244A of the said Act. The
matter is currently pending.Pursuant to spot inspections conducted at our Guntur branch, the ITO (TDS), Guntur
issued orders dated March 25, 2013 for AY 2010-11, 2011-12, and 2012-13, respectively, under Section 201(1)
and 201(1A) of Income Tax Act, demanding ` 0.49 million towards tax payable due to improper 15G/H forms
maintained by our Bank, and interest payable on such tax. Our Bank has filed a reply dated December 3, 2014
and submitted certain documents. The matter is currently pending.

Indirect Taxation

1. Our Bank received a notice dated June 21, 2010 from the Additional Commissioner of Central Excise and
Service Tax, Trichur (“ACCE”) requiring us to show cause as to why it is not liable to pay certain sums for
failure to correctly assess and pay service tax on the amount credited to its “VISA Commission Received
Account” and for willfully suppressing actual value of taxable service provided during the period from April 1,
2006 to June 30, 2009. The matter relates to the alleged liability of our Bank to pay service tax on the amounts
collected by our Bank from our customers who utilize the ATMs of other banks. Pursuant to the personal
hearing provided to our Bank, the ACCE passed an order dated November 19, 2012 holding that our Bank was
liable to pay service tax, education cess, and secondary and higher education cess on taxable value of services
of ` 12.52 million under Section 65 (33a) of the Finance Act, 1994. Our Bank was directed to pay the following
sums: a) ` 1.46 million towards service tax, ` 0.03 million towards education cess, ` 0.01 million towards
secondary and higher education cess, b) interest of ` 1.05 million under Section 75 of the Finance Act, 1994 c)
` 0.15 million, ` 5,000 and ` 1.51 million as penalties under Sections 76, 77 and 78 of the Finance Act.
Subsequently, our Bank filed an appeal dated December 24, 2012 before the Commissioner of Central Excise
(Appeals) (“CCE (A)”), against the order dated November 19, 2012 passed by the ACCE. Our Bank has also
preferred a petition dated December 24, 2012 before the CCE (A) to waive the pre-deposit of the above-
mentioned penalties imposed by the ACCE. The matter is currently pending.

2. Our Bank received a notice dated September 2, 2008 from the Joint Commissioner of Central Excise, Customs
and Service Tax (“JCCE”) requiring us to show cause as to why our Bank was not liable for the failure to
discharge service tax liability in relation to banking and other services received by our Bank from foreign banks
and agencies incorporated outside India for the period from September 2004 to September 2007. After affording
a personal hearing, the JCCE passed an order dated September 9, 2010 holding that our Bank was liable to pay
service tax for the afore-mentioned taxable service only for the period after April 18, 2006, and directing the
payment of the following sum for the period between April 2006 and September 2007: a) service tax of ` 0.86
million towards service tax, ` 0.02 million towards education cess, ` 2,663 towards secondary and higher
education cess appropriated from amount paid by us on April 29, 2008 that was appropriated from the amount
that was already paid by us; b) interest as applicable under Section 75 of the finance Act for the period from
April 18, 2006 to September 30, 2007; c) ` 0.88 million towards penalty under Section 78 or ` 0.22 million if
the balance under a) and b) were paid within 30 days from the communication of the said order; d) penalty of `
1000 under Section 77 of the said Act. Our Bank has filed an appeal dated December 2, 2010 before the CCE
(A), against the imposition of the penalty of ` 0.88 million imposed by the JCCE along with a petition to waive
the pre-deposit of penalties imposed under Sections 77 and 78. Furthermore, pursuant to the receipt of the order
dated September 9, 2010 holding that our service tax liability arose only for the period after April 18, 2006, our
Bank filed a claim dated September 24, 2010, claiming refund of ` 0.57 million for service tax paid for the
period from September 2004 to March 2006. Our Bank had previously filed the said claim earlier which was
rejected through an order dated August 9, 2010 passed by the ACCE as it was premature and that the show
cause notice dated September 2, 2008 was pending adjudication. Our Bank filed an appeal before CCE (A)
against the order of the ACCE rejecting the said refund claim. Subsequently, our Bank received a show cause

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 notice dated December 8, 2010 from the ACCE requiring us to show cause as to why refund claim should not
be rejected. We filed a reply dated December 20, 2010 stating that our Bank, as a service recipient, had paid the
service tax from its own sources and had not passed on the incidence of service tax to anyone, and were
therefore, eligible for the refund. The matters are currently pending.

3. Our Bank received a notice dated May 19, 2014 from the JCCE requiring us to show cause as to why we should
not be made liable to pay the following: a) ` 0.82 million towards service tax, ` 0.02 million towards education
cess, ` 8,169 towards secondary and higher education cess, aggregating to ` 0.84 million short paid for the
period between April, 2012 and March 2013, b) interest on the aforesaid amount at the applicable rate under
Section 75 of the Finance Act, c) penalty under Section 76 of the said Act, d) penalty under Section 77(2) of the
said Act for failure to correctly assess and pay service tax by not including discounts received on collateralized
borrowing and lending obligation. Our Bank has filed its reply dated June 13, 2014 stating that the income
received by the Bank by way of discount is exempt from service tax. The matter is currently pending.

Proceedings before the Board for Industrial and Financial Reconstruction (“BIFR”)

1. Surya Pharmaceuticals Limited filed a reference dated August 5, 2013 before BIFR under section 15(1) of the
Sick Industrial Companies (Special Provisions) Act, 1985 (“SICA”) for declaration as a sick company under the
provisions of SICA. Pursuant to the reference, case number 85 of 2013 was allotted by BIFR, and our Bank,
being a secured creditor in relation to a loan facility availed at our Chandigarh branch, was made a defendant to
the matter, along with other creditors of Surya Pharmaceuticals Limited and certain third parties. On November
19, 2014, BIFR heard certain miscellaneous applications filed by other defendants to the matter, and directed
our Bank to file our objection to the sickness of Surya Pharmaceuticals Limited. Our Bank is yet to file an
objection. The amount involved in the matter with respect to our Bank is approximately of ` 841.45 million.
The matter is currently pending.

Our Bank, along with the other lenders of the consortium, had initiated proceedings against Surya
Pharmaceuticals Limited under the SARFAESI Act on August 8, 2013, which was challenged by Surya
Pharmaceuticals Limited before the High Court of Jammu and Kashmir. Pursuant to an order dated October 9,
2013, the High Court stayed the proceedings, consequent to which the SARFAESI proceedings were withdrawn
by the lenders and the stay was subsequently vacated. Fresh notices under the SARFAESI Act were issued by
the lenders on December 8, 2014. The matter is currently pending.

2. United Ukraine Technologies Private Limited (“UUTPL”) filed a reference submitted on January 10, 2014, ,
before BIFR under section 15(1) of SICA for declaration as a sick company under the provisions of SICA.
Pursuant to the reference, case number 21 of 2014 was allotted by BIFR, and our Bank, being a secured creditor
in relation to a loan facility availed at our Ashok Vihar, New Delhi branch, was made a defendant to the matter,
along with certain government authorities. Our Bank is yet to file an objection to the reference. Our Bank has
assigned our exposure in UUTPL pursuant to an assignment deed dated December 31, 2013 to Phoenix Asset
Reconstruction Company Private Limited, Mumbai. However, the asset reconstruction company is yet to file a
substitution petition and the objection to the reference. The matter is currently pending.

3. Butterfly Spinning Mills Private Limited filed a reference dated April 26, 2007 before BIFR under section 15(1)
of SICA for declaration as a sick company under the provisions of SICA. Pursuant to the reference, case
number 100 of 2006 was allotted by BIFR, and our Bank, being a secured creditor in relation to a loan facility at
our IFB Coimbatore branch, was made a defendant to the matter, along with certain government authorities.
Our Bank received a notice from BIFR dated October 30, 2006, and we appeared before BIFR on May 23,
2007, in accordance with the notice, and subsequent hearing on May 30, 2007 dismissing the reference filed by
the company. The amount involved in the matter with respect to our Bank is approximately ` 25 million, which
was paid as a one-time settlement to our Bank pursuant to a compromise proposal dated October 23, 2009, as
sanctioned by our Bank on December 23, 2009. Butterfly Spinning Mills Private Limited filed an appeal (228 of
2007) before the AAIFR on August 3, 2007 against the dismissal dated May 30, 2007. Our Bank filed a reply to
the appeal, and subsequently pursuant to an order dated December 31, 2008 of the AAIFR, the impugned order
was set aside and the matter was remanded to BIFR. On March 9, 2009, BIFR directed our Bank to carry out a
special investigative audit within two months and Butterfly Spinning Mills Private Limited was directed to pay
the actual expenses of the audit. The audit report was filed by our Bank, and Butterfly Spinning Mills Private

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 Limited was directed by BIFR on February 24, 2010 to file a reply to the audit report and also reconcile its
outstanding dues with the EPF department. On June 30, 2010, our Bank was appointed as the operating agency
in relation to the proceedings. Subsequently, a draft rehabilitation scheme was submitted by Butterfly Spinning
Mills Private Limited, which the BIFR directed to the monitoring board to examine on March 19, 2013. During
a hearing dated June 14, 2013, Lakshmi Sai Cotton Traders filed a miscellaneous application seeking the
dismissal of the reference to enable continuation of execution proceedings filed by the company before the
District Court, Erode. Further, post hearings on August 12, 2013 and October 14, 2013, Butterfly Spinning
Mills Private Limited was directed to submit a revised draft rehabilitation scheme. A joint meeting was held on
January 31, 2014 as per directions of BIFR dated December 10, 2013. On February 18, 2014, our Bank was
directed to submit a fully tied draft rehabilitation scheme with the BIFR for circulation by the board. The matter
is currently pending.

4. Tutticorin Alkalies Chemicals & Fertilizers Limited (“TACFL”) filed a reference on February 19, 2009, as
revised on June 26, 2009, before BIFR under section 15(1) of SICA for declaration as a sick company under the
provisions of SICA. Pursuant to the reference, case number 09 of 2009 was allotted by BIFR, and our Bank,
being a secured creditor in relation to a loan facility at our Chennai-I branch, was made a defendant to the
matter, along with other creditors and certain government authorities. The amount involved in the matter with
respect to our Bank is approximately ` 10.95 million. Our Bank represented before the BIFR that the account of
TACFL at our Bank is in relation to a working capital facility and the account is regular. Our Bank has not yet
filed any objection to the reference. The matter is currently pending.

5. Thanikkudam Bhagawati Mills Limited (“TBML”) and Today’s Writing Products Limited (“TWPL”) had,
pursuant to two separate references in 2006 and 2011, respectively before the BIFR under section 15(1) of
SICA, sought to be declared as a sick company under the provisions of SICA. Our Bank, being a secured
creditor in relation to a facilities sanctioned to TBML and TWPL, was made a defendant to the aforesaid
references before the BIFR. Subsequently, our Bank had assigned our exposure in both TBML and TWPL to
Asset Reconstruction Company (India) Limited (“ARCIL”) and our Bank has been substituted by ARCIL in
relation to the aforesaid references before the BIFR. However, we continued to receive intimations in the
aforesaid matters post substitution as well. We have not responded to such intimations.

Cases filed by our Bank

Criminal proceedings

In the ordinary course of our banking business, we experience numerous frauds which are committed at our Bank,
by either the employees of our Bank, our customers or third parties. While our Bank is required to report each
instance of frauds committed to the RBI in the prescribed format (Form FMR-1), we also undertake internal
investigations and departmental inquiries, as well as initiate legal action against the responsible parties in certain
cases. Details of frauds committed against our Bank, and the actions taken by our Bank with respect to each fraud, is
as follows:

S. Nature and Relevant Amount Internal action Legal action initiated, if any
No. description of fraud dates involved taken
(`
million)
1. Pledge of spurious Fraud 1.30  Internal  First information report (FIR No.
gold ornaments by committed investigation and 1605) dated October 11, 2014
Radhalakshmi, on March departmental filed by our Bank against
against loans 5, 2013, enquiry Radhalakshmi at the Tripunithra
amounting to ` 1.30 detected conducted and Police Station, before the
million availed by on July 10, completed on Additional Chief Judicial
her at the Tripunithra 2014. June 27, 2014. Magistrate, Ernakulum.
branch of our Bank.  Form FMR-1 Investigation is pending and the
dated July 25, charge-sheet is yet to be filed.

276
 2014, submitted
to the RBI (Ref.
No. CASY1403-
0001).
 Disciplinary
action against
branch manager
referred to staff
department and
is pending.
 Letter of caution
served to the
other concerned
members of the
staff.
 Insurance claim
filed on January
2, 2015.
2. Fraudulent transfer Fraud 0.60  Internal  Complaint filed with the City
of funds from an committed investigation and Police Commissioner,
account maintained on departmental Thiruvananthapuram on March
at the Kowdiar February enquiry 26, 2014, which was forwarded
branch of our Bank 18, 2014, conducted and to the Superintendent of Police,
by hacking into the detected completed on Cyber Police Station, Pattom,
email account of the on April March 21, 2014. Thiruvananthapuram.
account holder. 23, 2014.  Form FMR-1  First information report (FIR No.
dated April 28, 2505) dated April 17, 2014 filed
2014, submitted against unknown at the
to the RBI (Ref. Peroorkada Police Station.
No. CASY1402- Investigation is currently
0001). pending.
 Letter of
‘caution’ served
to the other
concerned
members of the
staff.
3. Fraudulent credit of Fraud 1.00  Internal  Complaint filed with the
the proceeds of a committed investigation and Superintendent of Police,
forged demand draft on March departmental Thanjavur on April 2, 2013,
drawn by Al 15, 2013 enquiry which was subsequently
Muzaini Exchange and conducted and withdrawn and a fresh complaint
Company at the detected completed on was filed with the Superintendent
Thanjavur branch of on March June 13, 2013. of Police, Thiruvarur on April 25,
our Bank. 28, 2013  Form FMR-1 2013.
dated July 19,  Concurrently, a criminal petition
2013 submitted filed by the Thanjavur branch
to the RBI (Ref. manager of our Bank before the
No. CAY1303- High Court of Tamil Nadu at
0001). Chennai on April 26, 2013.
 International  First information report (FIR No.
Banking 8/2013) dated July 30, 2013 was
Division was filed against Ali Maideen VMJ
cautioned post and others at the Thiruvarur
recommendation Police Station. Investigation is

277
 of the erstwhile currently in process.
MD&CEO.
 Insurance claim
filed on May 5,
2014.
4. Loan availed at our Fraud 0.45  Internal  Criminal complaint (P.C. No. 23
Mangalore branch by occurred investigation and of 2013) filed before the
Gulzar M.S., the on May 6, departmental Additional Chief Judicial
customer, based on 2004, enquiry Magistrate, Mangalore – II on
forged property detected conducted and May 3, 2013 for registering the
documents for on April 8, completed on complaint for investigation.
furnishing security, 2013 April 24, 2013.  First information report (FIR No.
which could not be  Form FMR-1 0178/2013) dated September 5,
enforced once the dated July 23, 2013 filed against Gulzar M.S. at
loan became an 2013 submitted the Mangalore North Police
NPA. to RBI (Ref. No. Station.
CASY1303-  Recovery suit (O.S. 81/2012)
0004). dated June 16, 2012, was filed by
 Pay scale of the us against Gulzar M.S. and his
relevant senior wife Zareena Gulzar, before the
and chief court of Sub-judge of kasaragod,
managers on June 16, 2012. The suit was
lowered, and a decreed in favour of our Bank on
single increment September 27, 2102. Execution
withheld of a proceedings are currently
chief manager. pending.
 Insurance claim
filed on May 5,
2014.
5. Fraudulent credit of Fraud 0.53  Internal  Complaint filed on December 17,
the proceeds of a committed investigation and 2012 at the Ernakulum and
forged demand draft on departmental Vanrai, Mumbai Police Stations.
drawn by Habib November enquiry  First information report (FIR No.
Qatar International 8, 2012, conducted and 136/13) dated May 6, 2013 filed
Exchange Limited at detected completed on against Arun Joshi at the Vanrai,
the Ernakulam on May 23, 2012. Mumbai Police Station.
branch of our Bank. December  Form FMR – 1  No civil suit has been filed till
5, 2012 dated August 8, date.
2013 and  Suraj Norohna and Rita Toras,
corrected FMR – filed a consumer complaint
1 dated (68/2014) filed before District
September 27, Consumer Dispute Redressal
2013 submitted Forum, Mangalore against our
to RBI (Ref. No. Bank. Case is pending.
CASY1303-
0007).
 Advisory letter
served to the
relevant assistant
general manager,
core banking
systems.
 System used to
fill in payee
details upgraded.

278
  Insurance claim
filed on May 5,
2014.
6. Fraudulent transfer Fraud 0.10  Internal  Complaint filed on May 25, 2013
of funds from an committed investigation at the Kaduthuruthy Police
account maintained on April conducted and Station.
at the Kaduthuruthy 25, 2013, completed on  First information report (FIR No.
branch of our Bank detected May 24, 2013. 526/13) dated June 6, 2013 filed
by hacking into the on May 1,  Form FMR – 1 against HDFC Bank, Gurgaon
email account of the 2013 dated July 22, Branch, Esther Lalsiamkimi,
account holder. 2013 submitted Amaltas Retail Private Limited
to RBI (Ref. No. and Lush & Fresh Hand Made
CASY1303- Cosmetics at the Kaduthuruthy
0001). Police Station.
 Circulars issued
with respect to
email
instructions and
internet banking.

7. Gold items pledged Fraud 0.68  Internal  Complaint filed with the
against certain loans committed investigation and Commissioner of Police, Chennai
taken were found on June 7, departmental on July 12, 2013.
missing at the time 2013, enquiry  First information repost (FIR No.
of release at the detected conducted and 930/13) dated September 12,
Mount Road, on June 7, completed on 2013 filed against unknown at the
Chennai branch of 2013 July 12, 2013. F1 Chintadripet Police Station.
our Bank.  Form FMR – 1  Police submitted a report on
dated July 27, September 12, 2014, stating that
2013 submitted the there is no evidence to fix the
to RBI (Ref. No. accused for the offence.
CASY1303-
0006).
 The relevant
probationary
assistant
managers and
assistant
managers were
suspended and
were later re-
instated.
 Insurance claim
filed on April 11,
2014.
8. Equitable mortgage Fraud 50.85  Internal  Matter was reported to the SFIO
created out of forged committed investigation and on October 11, 2013.
title deeds at the Lal on August departmental  First information report (FIR No.
Bazar, Kolkata 18, 2011, enquiry 299) dated July 9, 2014 filed
branch. detected conducted and against Pushpesh Baid, Kokila
on July 3, completed on Devi Baid, Padmini Jewellers
2013 July 26, 2013. Private Limited and Anurag
 Form FMR – 1 Merchants Private Limited at the
dated September Bow Bazar Police Station.
9, 2013  Civil suit (O.A. No. 475 of 2012)

279
 submitted to RBI filed before the Debt Recovery
(Ref. No. Tribunal against Padmini
CASY1303- Jewellers Private Limited, dated
0008). December 17, 2012.
 Monetary  Case is currently pending.
penalty of ` 0.4
million imposed
on the relevant
General Manager
and ` 0.06
million has been
imposed on the
concerned
Deputy Zonal
Manager.
 Insurance claim
filed on October
25, 2014.
9. Fraudulent transfer Fraud 4.30  Internal  Complaint filed on May 25, 2013
of funds from an committed investigation with the Cyber Cell (Kochi City).
account maintained on May conducted and  First information report (FIR No.
at the Kaloor branch 16, 2013, completed on 711) dated May 26, 2013, filed
of our Bank by detected May 28, 2013. against unknown at the
hacking into the on May  Form FMR – 1 Ernakulum Town Police Station.
email account of the 24, 2013. dated July 20,  Consumer complaint (C.C. No.
account holder 2013 and revised 80 of 2013) filed on September
FMR-1 dated 13, 2013 by Sebastian Karampil,
September 13, the customer, against our Bank
2013 submitted before the State Consumer
to RBI (Ref. No. Dispute Redressal Commission,
CASY1303- Thiruvananthapuram, claiming
0002). the amount transferred along with
 Circulars issued compensation. The matter is
with respect to currently pending.
email
instructions and
internet banking.

10. Mortgage created out Fraud 2.50  Internal  Criminal complaint filed on
of forged title deeds committed investigation and August 4, 2014.
at the Lal Bazar, on April departmental  First information report (FIR No.
Kolkata branch. 26, 2011, enquiry 372) dated August 18, 2014 filed
detected conducted and against Haripada Datta, Probal
on April completed on Roy and Zircon Food and Agro,
23, 2014 November 22, partnership firm, at the Bow
2013. Bazar Police Station.
 Form FMR – 1  Civil suit (O.A. No. 129 of 2014)
dated April 30, filed before the Debt Recovery
2014 and Tribunal, Kolkata on April 11,
submitted to RBI 2014, against Zircon Food and
(Ref. No. Agro and other.
CASY1402-  Case is currently pending.
0002).
 The concerned
Assistant

280
 General Manager
suspended on
November 7,
2013.
 Insurance claim
filed on October
25, 2014.
11. Irregularities/ Fraud 138.53  Internal  Matter was reported to the SFIO
fraudulent practices committed investigation and on October 21, 2010.
in the disbursal of on departmental  First information report (FIR No.
funds and post February enquiry 804) dated July 5, 2011 was filed
lending management 25,2010, conducted and by Ashraf against T K Sasidharan
of certain loans at detected completed on and Bincy (bank staff), at the
the Kannur branch. on October November 3, Kannur town police station,
5, 2010 2010. alleging fraudulent extension of
 Form FMR – 1 mortgage property.
dated October  Criminal complaint filed before
20, 2010 Judicial First Class Magistrate –
submitted to RBI I, Kannur, against (i) M.A. Jose,
(Ref. No. CASY former senior manager of our
1004-0002). Bank, and others, being
 The relevant complaint number (C.M.P.
senior manager 2028/2014) dated May 7, 2014
was dismissed (ii) M.A. Jose, former senior
from the service manager of our Bank, and
on September Rafeek, being complaint number
29, 2010. (C.M.P. 2029/2014) dated May 7,
2014 (iii) M.A. Jose, former
senior manager of our Bank, and
K. Maharoof, being complaint
number (C.M.P. 2030/2014)
dated May 7, 2014 (iv) M.A.
Jose, former senior manager of
our Bank, and K.P Riyas, being
complaint number (C.M.P.
2031/2014) dated May 7, 2014
(v) M.A. Jose, former senior
manager of our Bank, and Haris
Cherattayadan and other, being
complaint number (C.M.P.
2032/2014) dated May 7, 2014
(vi) M.A. Jose, former senior
manager of our Bank, and Ansar
Cherattayadan, Managing Partner
of M/s K.M. Stone Crusher and
others, being complaint number
(C.M.P. 2033/2014) dated May 7,
2014 and Ansar Cherattayadan,
Managing Partner of M/s K.M.
Stone Crusher and others. Cases
are currently pending.
 Recovery suit (O.A. No. 97 of
2013) filed on February 21, 2013,
before DRT Kerala and
Lakshadweep at Ernakulum

281
 against M/s K.M. Stone Crusher
and others. Case is currently
pending.
12. Inferior quality Fraud 4.04  Departmental  Criminal complaint filed on June
ornaments were committed enquiry was 2, 2011.
pledged to avail gold on conducted.  First information report (FIR No.
loan from Tiruvallur December  Form FMR – 1 13/2011) dated June 2, 2011 filed
branch. 18, 2009, dated May 23, against Dilip Kumar Jain, at the
detected 2011 submitted Tiruvallur police station.
on May to RBI (Ref. No. Investigation is currently
11, 2011 CASY 1102- pending.
0001).
 Staff
accountability
aspects were
examined.
 There is no
outstanding
amount because
the borrower has
closed all
irregular gold
loan accounts
with total
outstanding as
on March 31,
2011. This
matter was
reported to the
police
authorities,
Tiruvallur.
13. Inferior quality Fraud 33.59  Departmental  Matter was reported to the SFIO
ornaments were committed enquiry on February 2, 2011.
pledged to avail gold on conducted and  First information report (FIR No.
loan from Pervallur November detailed 278/2011) dated July 6, 2011
branch. 22, 2010, investigation was filed against George Fernandes,
detected conducted by Vennila Fernandes, Raju Daniel
on January February 19, and Sankar Narayan, at the
27, 2011. 2011. Central Crime branch, Egmore –
 Form FMR – 1 Chennai, police station.
dated February Investigation is still in process.
3, 2011  Civil suit (O.A. No. 31 of 2012)
submitted to RBI filed on February 01, 2012,
(Ref. No. CASY before the DRT -III Chennai
1101-0001). against Vennila George
 The concerned Fernandes and others.
Principal Officer  Civil suit (O.A. No. 32 of 2012)
was dismissed filed on February 1, 2012, before
from service on the DRT-III Chennai against H.
February 2, George Fernandes and others.
2011. The  Both civil suits were transferred
concerned to DRT-II, Chennai and were re-
Assistant numbered (O.A. 217 and 218 of
Manager was 2013, respectively). Both civil

282
 suspended on suits were decreed in favour of
February 2, our Bank.
2011; however
he was thereafter
appointed in the
service as
Probationary
Assistant
Manager
 Insurance claim
filed on February
16, 2011 and
February 21,
2011.
14. Loans availed from Fraud 5.39  Detailed Recovery suit (O.A. No. 111 of
the Avanshi branch committed investigation was 2009) was filed before DRT,
on security of on completed by Coimbatore, against Mr. G. Ganesh
equitable mortgage November December 31, and others. The case was decreed in
of land, title deeds of 16, 2006, 2010. favour of our Bank.
which were also detected  Form FMR – 1
mortgaged to and on October dated October
taken possession of 11, 2010 27, 2010
by UCO Bank. submitted to RBI
(Ref. No. CASY
1004-0003).
 The concerned
Chief Manager
of branch,
against whom
lapse was noted,
voluntarily
retired from
bank’s service
and bank
decided to not to
proceed against
him.
 A stay order has
been obtained
from the court
based on the
contention that
title deeds with
our Bank were
original.
 Vigilance
department
instructed branch
to conduct
investigation and
to scrupulously
follow up the
cases in the court
of law and also
to try for out of

283
 court settlement
to recover the
dues.
 Insurance claim
filed on
November 6,
2011.
15. Inferior quality Fraud 1.95  Internal No legal action has been initiated
ornaments pledged committed investigation and because amount has been fully
for 29 gold loan on July 26, departmental recovered.
accounts at the 2010, enquiry
Puthenpeedika detected conducted and
branch. on October completed on
5, 2010 October 6, 2010.
 Form FMR – 1
dated October
18, 2010
submitted to RBI
(Ref. No. CASY
1004-0001).
 The concerned
Senior Manager
and the
concerned
Assistant
Manager were
suspended from
the service on
October 7, 2010.
 Subsequently,
the concerned,
Senior Manager
was imposed the
punishment of
compulsory
retirement and
the concerned,
Assistant
Manager was
reinstated in
service.

16. Misappropriation Fraud 9.40  Internal  For the loan account of M/s T.
and criminal breach committed investigation and Jayaram & Sons, suit filed at
of trust by staff and on June departmental DRT Chennai and case was
customer in one 21, 1996 enquiry transferred to DRT, Coimbatore
agricultural loan detected conducted and (O.A. 17527978).
account of on completed on  For the loan account of M/s Sri
Singanallur branch, September January 21, Sukra International, suit filed at
cash withdrawals of 27, 1997 1998. DRT Chennai (O.A. 1422/98)
large amounts  Form FMR – 1 against R. Krishnaswamy
allowed without dated March 31, (proprietor of Sri Sukhra
ensuring end use of 1998 submitted International) and case
funds with respect to to RBI (Ref. No. transferred to DRT Coimbatore.
certain loans. CASY9602- Decreed on February 25, 2006.

284
 0001).  Writ petition (W.P. 6587/2009)
 The concerned, filed inter alia against our Bank
branch manager was filed by M/s. T. Jayarama &
grade was Sons and others before High
lowered from II Court of Judicature at Madras.
to I and was also
punished with
stoppage of 3
increments.

17. Cheating and forgery Fraud 1.50  Internal  Police complaint No. 125/96 filed
by customer for a committed investigation and on July 5, 1996.
loan by depositing on March departmental  First information report dated
forged title deeds at 5, 1996 enquiry was September 21, 2011 filed with
the Feroke branch. detected conducted. Judicial First Class Magistrate
on May  Form FMR – 1 Court, Kozhikode on September
30, 1996 dated June 20, 21, 2001.
1996 submitted  Civil suit (SR 716) filed at DRT
to RBI (Ref. No. Chennai, against M/s. Prestige
CASY 9601- Surgicals and others decreed on
0001). August 29, 2000. Since there are
 Circular issued no assets, our Bank was not able
regarding the to continue with the proceedings.
precaution to be
exercised while
accepting
collateral
security
documents.
 The concerned,
branch manager
was punished
with lowering of
4 stages of
increment.

18. Misappropriation Fraud 7.76  Internal  Criminal complaint (CMP

and criminal breach committed investigation and 6004/2000) filed on November
of trust by staff and on May departmental 14, 2000, before the Judicial First
customers at the 16, 1995 enquiry Class Magistrate Court,
Kozhikode Bazar detected conducted and Kozhikode – I.
branch on August completed on  Civil suit filed before Debt
23, 1996 September 29, Recovery Tribunal, Ernakulum
1998. (O.A. No. 127 of 1997).
 Form FMR – 1
dated August 23,
1996 submitted
to RBI (Ref. No.
CASY 9502-
0003).
 The concerned,
branch manager
was dismissed
from service.
 Guidelines

285
 issued to all
offices.
 Insurance claim
has not been
filed.
19. Equitable mortgage Fraud 0.7  Internal  Civil suit filed on December 15,
created on properties committed investigation and 2003.
already mortgaged in on departmental  Legal notice dated June 11, 2013
favour of the State February enquiry from SBI inter alia against our
Bank of India to 19, 2001, conducted and Bank was issued.
secure certain loans detected completed on  Civil suit filed against inter alia
at the Erode branch. on July 16, August 30, 2004. against our Bank by
2004  Form FMR – 1 Rangaswamy and R. Jayalakshmi
dated July 28, before the court of the District
2004 submitted Munsif of Trichengode, under
to RBI (Ref. No. O.S. No. 133/2003.
CASY 0403-  Civil suit filed by our Bank (C.S.
0001). No 277 of 2003) against M/s
 Bank issued G.N.M. Paper Boards and others,
circulars to before the Court of the
prevent such subordinate judge of Bhavani,
type of incidents. Tamil Nadu.
 Insurance claim  Complaint lodged by S.P.
filed on August Narayanasamy before the district
9, 2004. Superintendent of Police, Erode
on April 29, 2004.
20. Inspection of a Fraud 0.89  Internal  Criminal complaint against Zakia
machinery loan committed investigation Zabeen Syed and others filed in
account at the on April completed on the court of Additional Chief
Hyderabad branch 24, 2007 October 10, Metropolitan Magistrate – II,
revealed that the detected 2009. Nampally. Criminal case (crime
relevant machine had on  Form FMR – 1 no. 161/2010) was instituted
not been bought. September dated October dated May 30, 2010.
29, 2009 16, 2009,  Account has been closed.
submitted to RBI
(Ref. No.
CASY0904-
0001).
 Bank issued
specific circulars
in this regard.
 Staff
accountability
aspects were
examined.
 Insurance claim
filed on October
5, 2009.
21. Branch Manager of Fraud 4.21  Internal  Criminal complaint (93/2003),
Market Road committed investigation and dated January 31, 2003, against
Ernakulum branch, on March departmental Thottungal Corporation and
disbursed an 30, 2001 enquiry others was lodged with Central
overdraft on detected conducted and Police Station, Ernakulum.
mortgage against on July 26, completed on  Account is closed.
property which were 2002 October 1, 2002.

286
 subsequently found  Form FMR – 1
to be fictitious. dated October
29, 2002,
submitted to RBI
(Ref. No. CASY
0101-0001).
 Bank’s approved
valuer was
removed from
panel.
 Insurance claim
filed on January
2, 2004.
22. Cash credit limits Fraud 4.8  Internal  Criminal complaint dated August
secured against committed investigation and 12, 2009, against M/s
forged title deeds of on March departmental Subramania Agencies, lodged
properties already 11, 2008, enquiry with Commissioner of Police
mortgaged in favour detected conducted and Greater Chennai, Egmore.
of the Corporation on June completed on  FIR (No. 466/2009) dated
Bank at the 22, 2009 May 14, 2009. September 26, 2009 filed before
Kodambakkom  Form FMR – 1 the Central Crime Branch,
branch. dated July 3, Chennai against Mr. V.
2009, submitted Subramaniam and others.
to RBI (Ref. No.  Recovery suit (O.A. No. 55/09)
CASY 0903- filed at DRT, Chennai, and was
0001). decreed in favour of our Bank.
 Bank has issued  Recovery certificate issued on
specific circulars November 16, 2010 vide DRC
in this regard. 293/2010.
 Staff
accountability
aspects were
examined.
 Insurance claim
filed on June 30,
2009.
23. Housing loan Fraud 0.4  Internal  Criminal complaint (CMP No.
granted on equitable committed investigation and 5000/2009) dated August 11,
mortgage of property on departmental 2009 filed against Zakir Hussain
based on forged title December enquiry at the Judicial First Class
deeds at the 17, 2004 conducted and Magistrate Court, Kollam.
Mukathala branch. detected completed on  The court referred the case to
on June July 2, 2009.  First information report (FIR No.
29, 2009  Form FMR – 1 972/2009) was filed before the
dated July 16, Kottiyam Police Station against
2009 submitted Mr. Zakir Hussain and others.
to RBI (Ref. No.  Civil suit (O.S. No. 764/2009)
CASY 0903- dated October 8, 2009 was filed
0002). before the Subordinate Court,
 Bank has issued Kollam.
specific circulars
in this regard.
 Insurance claim
filed on July 16,
2009.

287
24. Branch manager of Fraud 8.54  Internal  First information report (FIR
the Mulund Mumbai committed investigation and 150/2003) dated June 13, 2003
branch granted loans on departmental lodged in the Mulund Police
against spurious gold December enquiry Station against Mr. N.
ornaments etc. 10, 2001 conducted and Krishnamoorthy and others.
without any sanction and completed on  Criminal complaint (C.C. No.
and proper detected July 22, 2002. 149/PW/05) dated July 21, 2005
documentation/ on May  Form FMR – 1 was filed against Mr. N.
reporting to higher 13, 2002 dated August 13, Krishnamoorthy, then branch
authorities and is 2002, submitted manager of the Mulund branch of
also charged with to RBI (Ref. No. our Bank.
conversion of CASY 0104-
property. 0001).
 The officer
concerned was
suspended
pending legal
action.
 Insurance claim
filed on
December 4,
2013.
25. Branch manager of Fraud 14.5  Internal  Criminal complaint dated August
M.G. Road, Pune committed investigation and 9, 2002 was filed with the Pune
issued certain inland on April departmental police station against (1) Mr. T.J.
letters of credit 22, 2002, enquiry Thomas, (2) Ms. Daisy Cyriac,
without proper detected conducted and (iii) Mr. K.M. Johny, and (iv) Mr.
authority, on July 24, completed on B. Chandran.
documentation and 2002 November 11,  Criminal complaint (R.C.C. 143
without accounting 2002. of 2003) dated January 29, 2002,
transactions at the  Form FMR – 1 was filed against our Bank was
branch. dated August 13, filed by Mr. K.M. Johny, before
2002 submitted Judicial Magistrate First Class,
to RBI (Ref. No. Pune.
CASY 0202-  Civil case (O.A. No. 136/2002)
0001). against M/s. Rini Engineering has
 The concerned been decreed in favour of our
Branch Manager Bank. Execution proceedings are
and the pending before DRT, Pune.
concerned  Civil case against Mr. Chandran
Assistant Pillai has been transferred to
Manager were DRT, Kerala (T.D. R.C. 42/2014)
suspended. and is currently pending.
 Insurance claim
filed on October
27, 2005.
26. Unauthorised credit Fraud 4.15  Internal  Criminal complaint (C.C.
facility extended for committed investigation and 58/2010) dated September 23,
illegal gratification on August departmental 2010 filed with the Metropolitan
(U.C.F.), fraud 11, 2001 enquiry Magistrate Court, Ahmedabad.
committed by detected conducted and  Recovery suit (O.A. No.
customer and on May completed on 67/2010) filed on July 7, 2010 at
outsiders- the branch 19, 2003 May 19, 2003. DRT Ahmedabad.
manager of  Form FMR – 1  Asset has been assigned to
Ahmedabad branch dated June 6, ARCIL on March 30, 2013.

288
 discounted certain 2003 submitted
LC’s. The collecting to RBI (Ref. No.
bank returned the CASY 0103-
accepted bills with 0001).
relevant lorry  Staff
receipts. The goods accountability
were not available at aspects were
the lorry office; the examined and
borrower colluded finalised.
with the transport  Insurance claim
company and filed on February
cheated the bank. 4, 2010.
27. Loans availed from Fraud 50.00  Form FMR – 1  Matter was reported to the SFIO
various banks committed dated February on February 10, 2006.
against the same on January 10, 2006  Criminal case No. 111/M filed in
property offered as 14, 2003, submitted to RBI the court of Additional
security by detected (Ref. No. CASY Metropolitan Magistrate at 38,
producing forged on 0601-0001). Ballard Pier, Mumbai on June 13,
title documents of February  Insurance claim 2006. Matter is currently
the property at the 6, 2006. filed on February pending.
Fort, Mumbai 22, 2006, an  Recovery suit filed before DRT –
branch. amount of ` I, Mumbai (O.A. No. 10/2005)
22,448,095 against M/s Soundcraft Industries
received from Limited and others and was
ECGC being decreed in favour of our Bank on
WTPSG claim. September 10, 2009. Recovery
certificate is currently pending.
 The account of M/s Sound Craft
Industries Limited is under
investigation by various agencies
like Income Tax Department,
Economic Offences Wing and
Serious Fraud Investigation
Office, Ministry of Corporate
Affairs, New Delhi.
28. Overdraft facility Fraud 4.00  Internal  Civil suit (Civil Case No.
availed on committed investigation and 8279/2005) filed against our
hypothecation limit on July 22, departmental Bank before Court of City Civil
by creating equitable 2003, enquiry Judge - IV, Chennai on October
mortgage based on detected conducted and 24, 2005. The case was dismissed
forged title deeds at on October completed on by the order dated August 3,
the Royapettah 31, 2005 October 31, 2007.
branch. 2005.  O.A. No. 146/06 filed at DRT,
 Form FMR – 1 Chennai dated April 13, 2007.
dated November Final orders were received and
14, 2005 recovery certificate has not been
submitted to RBI obtained (D.RC. No. 157/2007).
(Ref. No. Our Bank has not been able to
CASY0504- continue with the proceedings
0001). since there are no known assets.
 Staff  Criminal case filed (Cri. O.P.
accountability 16607/2006) was filed dated
aspects were January 24, 2006, before XVIII
examined. Metropolitan Magistrate,
 Insurance claim Saidapet Chennai, our bank

289
 filed on May 21, thereafter filed an appeal before
2004. the High Court of Madras (Cri.
O.P. No. 16607 of 2006), to set
aside the order passed by
Metropolitan Magistrate and to
direct the court to take
cognisance of the complaint, the
appeal was allowed.
29. Loan advanced to a Fraud 12.87  Internal  Criminal complaint (P.C.R. No.
proprietary concern committed investigation and 5466/2008) was lodged in the
against equitable on departmental Court of Additional Chief
mortgage of property December enquiry Metropolitan Magistrate - IV at
based on forged title 13,1996 conducted and Bangalore on March 27, 2008,
deeds at the detected completed on against Ashu Gupta and others.
Bangalore City on April 5, April 5, 2005.  Civil suit (O.A. No. 153 of 2006)
branch. 2005  Form FMR – 1 was filed by our Bank for
dated April 22, recovery of dues on January 27,
2005 submitted 2006.
to RBI (Ref. No.  IA No. 1031/ 2010 filed by our
CASY 0502- Bank was dismissed by DRT,
0001). Bangalore on June 22, 2010.
 Staff  Account was closed on March 31,
accountability 2012.
aspects were  Asset was sold to ARCIL, on
examined. March 30, 2012.
 The concerned,
empanelled
valuer was
removed.
 Insurance claim
filed on May 3,
2005.
30. A partnership firm Fraud 4.00  Internal  Criminal case filed by our Bank
availed overdraft committed investigation and at Saidapet Court on September
facilities and inland on July 12, departmental 13, 2004 (C.C. 5880/04).
letter of credit limit 2002, enquiry  Civil suit filed by our Bank on
against equitable detected conducted and January 27, 2005, OA. 13/05.
mortgages based on on April completed on Recovery certificate obtained to
forged title deeds 28, 2004 April 28, 2004. attach the property of Mr.
and documents at the  Form FMR – 1 Balasundaram.
Royapettah branch. dated May 17,  Recovery suit (O.A. No. 13 of
2004 submitted 2005) filed before DRT – I,
to RBI (Ref. No. Chennai, against M/s Vox
CASY 0402- Automax and others and on April
0001). 10, 2006, case was decreed in
 Bank has issued favour of our Bank. Recovery
circular to certificate has been received by
prevent this type our Bank (DRC No. 179 of
of incidents. 2006), however our Bank is not
 Staff able to continue the proceedings,
accountability since there are no known assets.
aspects were  The account was compromised
examined. by the order of DRT-I, Chennai
 Insurance claim in the memorandum of
filed. compromise and record of

290
 settlement dated January 8, 2014,
with our Bank accepting ` 12.55
million as full and final
settlement of the account.
31. Unauthorised Fraud 0.75  Internal  Criminal complaint filed against
removal of gold committed investigation and N. Suresh, Assistant Manager,
loans securities on January departmental before the superintendent of
pledged to our Bank 10, 2003, enquiry police on February 29, 2008 and
by customers, pledge detected conducted and was registered as Crl. M.P. No.
of inferior quality of on completed on 166/08
gold ornaments, inter February February 17,  Post investigation, the matter was
branch transfers of 3, 2003 2003. considered to be of civil nature,
foreign currencies  Form FMR – 1 against which our Bank filed a
and availing of dated February protest complaint. Accused is
housing loan on the 6, 2003, absconding, the case is pending.
pretext of purchasing submitted to RBI  Suit filed by our Bank against
house by the (Ref. No. CASY Mr. N. Suresh (O.S. 159/05)
assistant manager of 0301-0001). dated December 20, 2005, after
the Kottayam  Service of the sale amount of ` 0.21 million was
branch. concerned, realised. The matter is pending
Assistant for adjudication.
Manager, was  Our Bank vide letter dated March
terminated. 9, 2004 requested RBI,
 Staff Thiruvananthapuram branch, for
accountability permission to delete references to
aspects were the case from on-going
examined. statements.
 RBI, Thiruvananthapuram
branch, however, vide letter dated
March 27, 2004, advised our
Bank to continue reporting the
case to RBI till the completion of
the recovery of the housing loan
availed by him.
32. Disbursal of various Fraud 12.48  Internal  Criminal complaint filed with
term loans for committed investigation and Ernakulum South Police Station.
personal interest and on May departmental  Civil suit (O.S. No. 1342/1996)
without proper 13, 1992 enquiry filed before Munsif Court of
sanction from the detected conducted and Ernakulum, against Mr. C.R.
head office by the on completed on Thomas and others.
branch manager of September October 7, 1995.  Civil suit filed (O.S.No. 1544/96)
the Valanjambalam 18, 1995  Form FMR – 1 before Munsif Court of
branch. dated January 2, Ernakulum, against Mr. N.K.
1996 submitted Sashidharan and others.
to RBI (Ref. No.  Civil suit (O.S. No. 1102/1997)
CASY 9202- filed before Munsif Court of
0002). Ernakulum, against Mr. P.J.
 Staff Joseph and others.
accountability  Civil suit (O.S. No. 1104/1997)
aspects were filed before Munsif Court of
examined. Ernakulum, against Mr. P.
Krishnakumar and others.
 Civil suit (O.S. No. 814/1997)
filed before Munsif Court of
Ernakulum, against Mr. M.K.

291
 Anil Kumar and others.
 Civil suit (O.S. No. 2220/1997)
filed before Munsif Court of
Ernakulum, against Mr. Abdul
Salam and others.
 Civil suit (O.S. No. 161/1998)
filed before Munsif Court of
Ernakulum, against Mr. M.
Sivdas and others.
 Civil suit filed (O.S. 736/98)
before Munsif Court of
Ernakulum, against Ms. Isha
Beevi and others.
 Civil suit (O.S. No. 828/1997)
filed before Munsif Court of
Ernakulum, against Mr. K.K.
Thomas and others.

33. Grant of over 350 Fraud 6.44  Internal RBI, Thiruvananthapuram branch,
unauthorised loans committed investigation and vide its letter dated November 19,
under the “Own on June departmental 1993 advised our Bank to file a
Today Scheme” by 11, 1992, enquiry police complaint against the officer
the branch manager detected conducted was who is involved in this fraud.
of the Madurai on April completed However, the board incorporating
branch, without 10, 1993  Form FMR – 1 the opinion of Chief Manager
proper sanction and dated May 10, (Law) resolved not to file police
with the help of 1993, submitted complaint and vide its letter dated
colluding suppliers. to RBI (Ref. No. March 23, 1994 informed RBI
CASY 9202- accordingly. Thereafter RBI vide
0001). another letter dated April 23, 1994
 Bank has issued advised our Bank to lodge police
various circulars. complaint immediately against the
 The concerned concerned officer.
staff was
demoted from
Grade IV to III
and power of
attorney kept in
abeyance for 5
years.
34. Senior Manager of Fraud 1.99  Internal  Recovery suit filed on January
the Yelahanka committed investigation and 20, 2007.
branch during his on departmental  Suit filed (O.S. no. 688/07)
tenure granted January, 9, enquiry against Mr. Nagaraj. S and his
various credit 2005 conducted and wife, Ms. D.K. Vedavalii on
facilities, amongst detected completed on January 20, 2007.
which seven were on March March 8, 2007.  Suit filed (0.S. 629/07) against
later reported as 8, 2007  Form FMR – 1 Mr. A.G. Shiv Kumariah and his
fraud, as several title dated March 16, wife Ms. Bhagyama on January
deeds, salary 2007 submitted 20, 2007.Suit filed against Mr.
certificates and to RBI (Ref. No. Jagadisha and Ms. Sobha (O.S.
recovery certificates CASY 0701- No. 6398/2007).
submitted to avail 0001).  Suit filed (O.S. 2149/07) against
the facility were  Our Bank Mr. Rajamonoharan R., Mr. N.V.
forged/fabricated. received a letter Gopalakrishnan, Mr.

292
 from RBI dated, Vasanthakumar and Mr.
April 7, 2007 Renjithkumar on March 14, 2007.
enquiring about  Criminal complaint (P.C.R. No.
staff 7277/2007) filed before the Court
accountability of Chief Metropolitan Magistrate
measures taken. at Bangalore, against Mr. A.G.
 Staff Mr. Shiv Kumariah, Ms.
accountability Bhagyamma and Ms.
aspects were Lakshmamma.
examined.  Criminal complaint (P.C.R. No.
 Insurance claim 0603/2007) was filed against Mr.
filed on March Raj Manoharan, Mr. N.V.
15, 2007. Gopalakrishnan, Mr.
Vasanthakumar, Mr.
Renjithkumar and Mr. Jayaraj.
Criminal complaint was filed also
against Mr. Jagadisha and Ms.
Shobha.
35. Nahur branch Fraud 0.44  Form FMR – 1  Criminal complaint filed against
granted a loan under committed dated February Shanthanu Parasuram Parab with
the “Own Your on April 28, 2005 Mulund Police Station, dated
Dream House” 21, 2004 submitted to RBI January 31, 2005.
scheme, against detected (Ref. No. CASY  First information report (FIR No.
equitable mortgage on 0501-0002). 218/2006) was filed before
to a person who February  Staff Mulund Police Station, dated
according to a police 24, 2005 accountability May 5, 2006 by the branch
report is allegedly a aspects were manager of our Mulund branch
part of a gang who examined. against Mr. Shantanu Parshuram
have cheated many  Insurance claim Parab.
banks in Mulund. filed on March  Accused was arrested and then
10, 2005. released on a bail.
 The Senior Inspector of police,
Crime Branch, CID, Mumbai,
have taken a statement from the
Branch Manager on July 22,
2005. Date of next hearing/
posting December 19, 2014 for
production of evidence
 Civil suit filed on October 4,
2005 – case is pending with High
Court, Mumbai (No. 2761/05).
36. Irregularities in Fraud 15.69  Internal  Criminal case filed under No.
foreign exchange committed investigation and 62/2000 at Criminal Court,
transactions by on October departmental Tuticorn. The case is currently
customers at the 28, 1996, enquiry pending.
Tuticorn branch detected conducted and  Case (O.A. No. 1850/2001)
on March completed on before DRT II Chennai was filed
9, 1998 March 9, 1998. by our bank against M/s Prathap
 Form FMR – 1 Timbers Private Limited.
dated March 20,  Recovery certificate (DRC No.
1998 submitted 89/2005) was issued in O.A. No.
to RBI (Ref. No. 1850/2001
CASY 9604-  First information report (FIR No.
0001). 18/2006) filed on November 7,
 Advised credit 2006 before District Crime

293
 department to be Branch Tuticorin, against M/s
more vigilant Prathap Timbers Private Limited
while processing and others has been filed in
proposals for vernacular, case pending due to
major limits. non-genuineness of the deeds.
 Account closed by compromise
settlement.
37. Unauthorised credit Fraud 70.48  Internal  A criminal complaint filed filed
facility extended for committed investigation and against Mr. K. Sakthikumar, M/s
illegal gratification, on October departmental Jem Ispat (Private) Limited and
by the branch 6, 1993, enquiry was its directors under C. No.
manager of the detected conducted. 86/1998, dated May 6, 1998,
Baroda branch, on August  Form FMR – 1 
including through 8, 1997 dated November  Recovery suit is filed (C.S. No.
discounted bills by 5, 1997, 1014/1999) dated October 29,
using fake letter of submitted to RBI 1999 at Civil Court, Baroda.
credits, without (Ref. No. CASY
entering bank 9304-0001).
records, discounting  In order to
of accommodation streamline the
cheques etc. Internal Control
mechanism at
branches, bank
has now
introduced the
system of Snap
Inspection
directly by the
vigilance
department.
Issued Circulars
315/97, 81/98
and 188/98.
 The concerned,
branch manager
was dismissed
from service and
concerned,
Assistant
Manager was
punished with
lowering of 1
stage of
increment in the
scale of pay.
 Insurance claim
filed on March
31, 1998.
38. Housing loan Fraud 2.10  Form FMR – 1  Civil suit (O.A. 67 of 2010)
granted by the committed dated February against Mr. Sriram Zaveri was
Ahmedabad branch on 3, 2010 filed on July 7, 2010 and others
based on forged and December submitted to RBI before DRT – I, Ahmedabad and
fabricated title deeds 6, 2004 (Ref. No. CASY case was decreed on May 22,
and documents, and detected 1001-0003). 2012. The possession of property
the account on January  Staff was already taken by Vijaya

294
 subsequently became 18, 2010 accountability Bank.
a non-performing aspects were  Recovery proceedings (R.P.
asset. examined. 48/12) pending at DRT-I,
 Extant guidelines Ahmedabad.
and instructions  Criminal complaint No. 58/2010
are clear. Bank was filed before Chief
has issued Metropolitan Magistrate,
specific circulars Ahmedabad, against Mr. Shriram
in this regard. Zaveri and others dated
 Insurance claim September 23, 2010.
filed on February
4, 2010.
39. Vadakara branch Fraud 1.16  Internal  First information report was
granted personal committed investigation and lodged at Vadakara Police
loans to 12 on August departmental Station, on March 6, 2009 (No.
employees of the 28, 2008, enquiry 191/2009) against Mr. Shahji
“Kerala Road and detected conducted and M.T. and others.
Bridges Surveyor’s on completed on  Original suit (O.S. No. 824/2009)
Limited” allegedly a December December 10, was filed against Mr. Shahji M.T.
fictitious 10, 2008 2008. and others on November 5, 2009
Government  Form FMR – 1 and was decreed on February 8,
undertaking, based dated December 2013.
on fabricated salary 22, 2008
certificates and submitted to RBI
guarantees. (Ref. No. CASY
0804-0001).
 Bank has issued
specific
instructions
regarding the
granting and
supervision of
term loans.
 Staff
accountability
aspects were
examined.
 Insurance claim
filed on
December 22,
2008.
40. Branch manager of Fraud 6.10  Internal  Criminal complaint made against
the Kanjirapally committed investigation and Mr. Joy Dominic and others
branch granted gold on January departmental before Kanjirapally Police
loans against inferior 1, 2008, enquiry Station dated June 10, 2008.
quality of gold detected conducted and  Civil suit nos. O.A. 85, 86 and 87
ornaments pledged on June completed on of 2009 filed before DRT.
by various parties. 27, 2008 June 27, 2008.  Original suits (O.S. 149/2009 and
 Form FMR – 1 O.S. 150/2009) filed before the
dated July 9, court of the Subordinate Judge,
2008, submitted Pala, against Mr. Mercy Joy, Mr.
to RBI (Ref. No. Joy Dominic and others. Appeal
CASY 0803- has been filed.
0001).
 Extant guidelines

295
 are clear Bank
has issued
specific circulars
in this regard.
 Concerned staff
members were
suspended and
were
subsequently
reinstated.
 Insurance claim
filed on July 8,
2008.
41. Cheating and forgery Fraud 1.17  Internal  Criminal complaint filed before
by customer – committed investigation and the Judicial Magistrate - III,
Advance payments on departmental Salem, dated March, 12, 2003,
granted in an February enquiry against Mr. S. Arumugam.
overdraft and 18, 1998 conducted and  Civil suit filed at DRT,
mortgage limit based detected completed on Coimbatore (O.A. 1509/2003)
on fraudulent work on December 24, dated May 26, 2003.
orders allegedly December 2002.
issued by the Tamil 24, 2002  Form FMR – 1
Nadu Electricity dated January 8,
Board at the Salem 2003 submitted
branch. to RBI (Ref. No.
CASY 9801-
0002).
 Staff
accountability
aspects were
examined.
 Insurance claim
filed on January
2, 2004.
42. Housing loan Fraud 5.18  Form FMR – 1  Recovery suit (O.A. No.
granted by the committed dated July 26, 240/2008) against M/s Harkirat
Ludhiana branch on 2010 submitted Traders (Proprietor being Mr.
based on forged and September to RBI (Ref. No. Amarjit Singh) filed at DRT-II,
fabricated title deeds 19, 2005, CASY 1003- Chennai dated April 19, 2008,
and documents, of detected 0002). which was decreed in favour of
property which had on July 22,  Extant guidelines our Bank on November 19, 2008.
already been sold by 2010 and instructions
legal heirs of the are clear.
property holders.  Bank has issued
a circular
(Circular No.
241/2010 dated
October 28, 2010
on “Fraud in
Title Deeds”).
 Insurance claim
filed on July 26,
2010.
43. Machinery loan and Fraud 1.14  Form FMR – 1  Civil suit against M/s A.K.
an overdraft committed dated July 15, enterprises was decreed.

296
 mortgage limit on January 2010, submitted  Criminal complaint dated
availed from the 19, 2006, to RBI (Ref. No. December was filed before Chief
Faridabad branch detected CASY 1003- Judicial Magistrate, Faridabad
based on title deeds on June 0001). and first information report (FIR
and documents to a 29, 2010  Staff No. 369/2010) dated December
property which had accountability 13, 2010 was filed before
been registered in aspects were Faridabad Kotwali against Mr.
the name of his heirs examined.Extant Jagdish Kumar and others.
pursuant to certain guidelines and  The account was compromised,
civil legal instructions are with receipt of amount of ` 1.05
proceedings. clear. million as full settlement.
 Insurance claim
filed on July 16,
2010.
44. Housing loan Fraud 0.85  Form FMR – 1  Criminal complaint against
granted by the committed dated June 12, Prince George and others was
Kayamkulam branch on June 2010 submitted filed on January 31, 2011 before
based on forged and 15, 2004, to RBI (Ref. No. JFCM, Kayamkulam Police
fabricated title deeds detected CASY 1002- Station.
and documents, of on May 0001).  First information report (FIR No.
property already 25, 2010  Staff 213/2011) was filed at
taken over by other accountability Kayamkulam Police Station
secured creditors. aspects were dated March 01, 2011 against
examined. Prince George and others.
 Insurance claim Investigation is in process.
filed on June 14,  Civil Suit (O.S. No. 318/2010)
2010. dated November 17, 2010 filed
before Sub Court, Mavelikara,
against Mr. Prince George and
others.
 Civil suit was decreed on January
31, 2012

45. Fraudulent Fraud 0.10  Form FMR – 1  Criminal complaint (No.

encashment/ committed dated January 27/SDOT/GL-PTN/2010) dated
manipulation of on 14, 2010, January 13, 2010, lodged with the
books and accounts September submitted to RBI police.
and conversion of 10, 2009, (Ref. No. CASY  First information report (FIR No.
property by customer detected 1001-0001). 55/2010) dated January 15, 2010
resulting in on January  Extant guidelines filed with Tirur Police Station.
unauthorised 1, 2010 and instructions
withdrawals from the are clear.
account of an  Insurance claim
account holder at the filed on February
Tirur branch. 16, 2011.
46. Unauthorised Fraud 0.26  Form FMR – 1  First information report (FIR No.
withdrawal from the committed dated October 0216/2009) lodged before Ashok
account of a savings on May 5, 26, 2009 Nagar police station, Bangalore
account holder of the 2009, submitted to RBI City against Mr. Ramesh and Mr.
Brigade Road, detected (Ref. No. Ranganathan dated June 6, 2009.
Bangalore branch, on October CASY0904-  Bank recovered ` 0.13 million
on four occasions. 12, 2009 0002). from the terminal benefits of Mr.
 Staff Thomas K.I., Senior Manager,
accountability and ` 0.14 million was written
aspects were off.

297
 examined.
 Extant guidelines
and instructions
are clear.
 Insurance claim
was filed on
February 16,
2011.
47. Housing loan Fraud 1.20  Internal  The branch served a notice under
granted by the committed investigation and SARFAESI Act on April 20,
Thirumala branch on August departmental 2007
based on forged and 18, 2004 enquiry  Criminal complaint (No.
fabricated title deeds detected conducted and 216/2008) filed on August 4,
and documents, and on May completed on 2008 before Sub-inspector of
the account 19, 2008 May 19, 2008. police, Poojapura,
subsequently became  Form FMR – 1 Thiruvananthapuram.
a non-performing dated June 5,  Civil suit (O.A. No. 106/09) was
asset. 2008 submitted filed before the DRT, Ernakulum
to RBI (Ref. No. against Mr. Reji Mani and others
CASY 0802- dated March 19, 2009 and it was
0002). ordered in favour of our Bank on
 Staff September 24, 2009. The suit has
accountability been adjourned sin-dine for want
aspects were of assets.
examined.
 Extant guidelines
and instructions
are clear. Bank
has issued
specific circulars
in this regard.
 Insurance claim
filed on June 5,
2008.
48. Overdraft on Fraud 1.68  Form FMR – 1  First information report (FIR No.
hypothecation limit committed dated January 22/1997) was filed with Central
and machinery loan on May, 18, 1997, Crime Branch, Tiruppur, on July
granted to a 19, 1995, submitted to RBI 7, 1997 and was dismissed by
borrower at the detected (Ref. No. CASY JFMC-I, Tirupur (Crl. M.P.
Tirupur branch, on July 25, 9502-0002). 139/99) decided on April 20,
collaterally secured 1996  Staff 2000.
by immovable accountability  Recovery filed with DRT,
properties, and aspects were Chennai on April 23, 1998 under
subsequently examined. O.A. No. 956/98, against
ascertained that most  Head office Prakash, proprietor of M/s Vester
of the machinery instructions Apparels and transferred to DRT,
secured was second- regarding Coimbatore (Transfer
hand and that bills granting of Application No. 603 of 2012).
and invoices were Machinery Final order has been passed on
forged. Loans are clear. March 16, 2007 and was decreed
in favour of our Bank.

298
49. Overdraft on Fraud 3.28  Departmental  First information report (FIR No.
mortgage facility committed enquiry 302/1999) was filed at Palakkad
granted to a on May conducted and Police Station, on May 11, 1999
contractor of the 27, 1991, completed on against Mr. A.M.M. Basheer and
public works detected June 5, 1999. Mr. Moiden Kunji Beary.
department on on March  Form FMR – 1  Criminal complaint (C.C. No.
encumbered land 11, 1999 dated June 30, 461/2001) lodged on April 13,
based on forged title 1999 submitted 1999 before CJM Court,
deeds of the property to RBI (Ref. No. Palakkad, which was then
at the Palakkad CASY 9102- transferred to CJFCM-I, Palakkad
branch. 0004). (C.C. No. 1/02006). Accused was
 Branch circular acquitted following the order of
issued in the JMFC M-I, Palakkad dated
matter of August 27, 2014.
registration of  Following the order of the DRT
Power of in I.A. No 680/99, an amount of
Attorney from approximately ` 3.90 million due
Government for payment to the contractor
Department and from the Government
verification of Departments, by obtaining an
encumbrance attachment order from DRT on
certificate. The March 30, 1999.
concerned  Original application (O.A. no.
branch Manager 290 of 1999) filed before DRT,
was punished Ernakulum, against Mr. A.M.M.
with lowering of Basheer and others was decreed
2 stages in the on March 12, 2001.
existing scale of
pay. Other
concerned staff
member was
cautioned.
 Bank empanelled
valuer was
removed from
panel.
50. Fraudulent transfer Fraud 0.25  Internal  No legal action has been initiated
from a current committed investigation and by us hitherto. However, a
account held by a co- on April departmental criminal complaint has been filed
operative society at 23, 2013, enquiry by Mr. Ramesh R. Dhamapukar
the Bandra West detected conducted and against M/s Rishab Co-operative
branch based on on completed on Society is pending before the
forged withdrawal December December 30, Judicial First Class Magistrate,
vouchers for certain 30, 2014 2014. Kalyan, Mumbai.
demand drafts.  Form FMR – 1
dated February
5, 2015,
submitted to RBI
(Ref. No. CASY
1501-0002).
 Our Bank had
already issued
revised circular,
dated March 17,
2014, titled:

299
 “Collection of
Account Payee
Cheques-
Prohibition on
Crediting to third
party accounts”,
based upon the
instructions of
RBI.
 Staff
accountability
aspects are to be
examined.
51. Fraudulent Fraud 0.42  Internal No legal action has been instituted.
encashment/ committed investigation and
manipulation of on departmental
books of account and November enquiry
conversion of 1, 2012 conducted and
property by staff by detected completed on
the branch manager on March April 15, 2013.
at the Service 15, 2013  Form FMR – 1
branch, Chennai. dated July 23,
2013 submitted
to RBI (Ref. No.
CASY 1303-
0005).
 Staff
accountability
aspects were
examined.
52. Shortage of cash Fraud 0.05  Departmental  A criminal complaint was
noticed in ATMs committed enquiry was instituted before the Court of
post replenishing of on conducted. Metropolitan Magistrate - XVIII,
cash by bank December  Form FMR – 1 Maypur at Kukatpally, dated
officials at the 2, 2009, dated December December 21, 2009. The
Kukatpally, detected 12, 2009 complaint has been dismissed by
Hyderabad branch. on submitted to RBI the court on March 5, 2012, and
December (Ref. No. the amount was fully recovered.
3, 2009 CASY0904-
0002). Extant
guidelines and
instructions in
this regard are
clear.
 Staff
accountability
aspects were
examined.
53. 22 gold loans availed Fraud 2.39  Internal  Criminal complaint lodged before
against pledge of committed investigation and the Circle Inspector of Police,
spurious gold on June 6, departmental Munnar dated December 10,
ornaments mixed up 2014, enquiry 2014.
with genuine gold detected conducted and  First information report (FIR No.
ornaments at the on completed on 1169) was lodged with Munnar
Munnar branch. December December 20, Police Station dated December

300
 10, 2014 2014. 11, 2014. The accused was
 Form FMR – 1 arrested and detained in police
dated January custody on December 18, 2014.
29, 2015, The investigation is pending.
submitted to RBI
(Ref. No.
CASY1501-
0001).
 Bank’s extant
guidelines are
clear in this
regard.
 Staff
accountability
aspects are to be
examined.

54. Opening of an Fraud 0.03  Internal  First information report (FIR No.
illegitimate savings committed investigation and 89/2011) was lodged on February
bank account by the on April 4, departmental 18, 2011 at Pandalam Police
Principal officer of 2009, enquiry Station against Mr. I.V. Davis,
the Thattayil branch detected conducted and former branch manager of the
by transferring tax on completed on Thattayil branch of our Bank.
deducted at source September September 17,  No civil suit was filed as the
on term deposits. He 17, 2010 2010. entire amount was recovered.
also entered/  Form FMR – 1
authenticated dated September
fraudulent 28, 2010
transactions in the submitted to RBI
account. (Ref. No.
CASY1003-
1001).
 Staff
accountability
aspects were
examined.
 The concerned,
Manager was
dismissed from
the service.
 The extant
guidelines and
instructions were
clear.
 Insurance claim
filed on
September 28,
2010.
55. Fraudulent Fraud 0.02  Departmental  Criminal complaint (31-5D)
transactions in the committed enquiry was dated April 1, 2010, was
staff overdraft on July 7, conducted. registered on April 7, 2010 and is
account of the 2009,  Form FMR – 1 under investigation. As the full
probationary detected dated November amount was recovered, no civil
assistant manager of on October 24, 2009, suit was filed.
the Gurgaon 28, 2009 submitted to RBI

301
 branch, in relation to (Ref. No.
the credit of discount CASY0904-
charges earned by 0001).
the branch to his  The extant
personal account guidelines and
instead of being instructions were
credited to the profit clear.
and loss account of  The concerned,
the branch. Probationary
Assistant
Manager was
dismissed.
 Staff
accountability
aspects were
examined.
 .
56. Fraudulent transfer Fraud 0.06  Internal  Criminal complaint (599/DPC-
of funds from the committed investigation R/Comp/PTN/12/R) was filed on
account of an on May completed on June 14, 2012 at District Police
account holder based 16, 2012, June 6, 2012. Chief (Rural), Thrissur.
on instructions detected  Form FMR – 1
received from an on June 6, dated June 12,
allegedly hacked 2012 2012, submitted
email account at the to RBI (Ref. No.
Wadakkancherry CASY1202-
branch. 0001).
 Staff
accountability
aspects were
examined.

57. 11 gold loans Fraud 1.71  Internal No legal action has been instituted.
extended to a committed investigation and
savings account on July 31, departmental
holder at the 2012, enquiry
Mulund, Mumbai detected conducted and
branch against on August completed on
pledge of genuine 7, 2014 July 18, 2014.
and spurious gold  Form FMR – 1
ornaments. dated September
26, 2014
submitted to RBI
(Ref. No.
CASY1403-
0002).
 Staff
accountability
aspects are to be
examined against
the Branch
Manager.
 Letter of caution
has been issued
to other officer’s.

302
  Bank’s extant
guidelines are
clear in this
regard.
58. Two term-loans for Fraud 200.00  Internal  Matter was reported to SFIO on
acquisition of committed investigation and October 15, 2013.
machinery and on October departmental  Criminal complaint (SR 4570 of
equipments granted 14, 2009, enquiry 2014) dated December 29,
at the Secunderabad detected conducted and 2014was instituted against M/s
branch. In violation on completed on Jupiter Bioscience Limited and
of sanction terms September September 29, others before the Additional
which resulted in the 29, 2013 2013. Chief Metropolitan Magistrate -
account becoming  Form FMR – 1 X, Secunderabad. The matter is
unsecured and dated September currently pending.
diversion of funds, 30, 2013  A suit (OA No. 524/2012), a suit
as well as non- submitted to RBI was filed in DRT, Hyderabad
confirmation of end (Ref. No. against M/s Jupiter Bioscience
use and no- CASY1303- Limited, to rover the dues. The
observance of due 0009). matter is currently pending.
diligence.  Training for
awareness of
fraud to be
conducted for
principal officers
of branches
along with
executives.
 Staff
accountability
aspects were
examined.
 The principal
officer was
awarded the
punishment of
lowering of 4
stages in the
existing scale of
pay.
 The concerned
General Manager
was awarded the
punishment of
recovery of `
0.6 million.
 Insurance claim
has not been
filed.
59. Misappropriation of Fraud 0.01  Departmental  No complaint was filed because
amount for cheque committed enquiry was the amount involved was less
payment and on August conducted. than ` 10, 000.
payment of gold loan 27, 2012,  Form FMR – 1
by the cashier of the detected dated February
Karukachal branch. on January 18, 2013,
23, 2013 submitted to RBI

303
 (Ref. No.
CASY1301-
0001).
 Amount was
recovered from
cashier.
 Staff
accountability
aspects were
examined.
60. Unauthorised credit Fraud 2.53  Internal  Recovery suit was filed (O.A.
facilities extended to committed investigation and No. 578 of 1995) before DRT,
members of the on June 1, departmental New Delhi, against M/s. Anchal
Anchal group, 1991, enquiry was Silk Mills.
collaterally secured detected conducted.  Account was assigned to ARCIL.
by mortgage of on  Form FMR – 1
immovable November dated December
properties in the 4, 1992 1, 1992
name of the submitted to RBI
guarantor, but (Ref. No.
actually acquired by CASY9102-
Government by the 0001).
branch manager at  Bank has issued
the New Delhi various circulars
branch. The regarding quality
borrower had also of advances.
availed finance from  The concerned l,
the Central Bank of Branch Manager
India. was dismissed.
 Staff
accountability
aspects were
examined.
61. Unauthorised credit Fraud 0.25  Internal Recovery suit (527/1993) was filed
facility as an committed investigation and on April 23, 1993.
overdraft of on April, departmental
hypothecation 1, 1991 enquiry was
facilities extended detected conducted. Form
for allegedly illegal on FMR – 1 dated
gratification to November December 1,
borrowers who were 4, 1992 1992 submitted
reported to to RBI (Ref. No.
unlicensed CASY9102-
contractors holding 0002).
non-operational  The concerned l,
accounts at the New Branch Manager
Delhi branch. was dismissed.
 Staff
accountability
aspects were
examined.
62. Unauthorised credit Fraud 0.12  Internal Civil suit (No. 838/1993) was filed
facility as a personal committed investigation and on July 17, 1993 against M/s Kent
credit line against on July 9, departmental Expo Corporation and others.
letter of credit 1991 enquiry

304
 extended for detected conducted and
allegedly illegal on completed on
gratification at the November date is N.A.
New Delhi branch 4, 1992  Form FMR – 1
by the branch dated December
manager, with due 1, 1992
enquiry and submitted to RBI
insurance. (Ref. No.
CASY9103-
0001).
 Bank has issued
various circulars
regarding quality
of advances.
 The concerned,
Branch Manager
was dismissed.
63. Spurious gold Fraud 0.19  Internal  First information report (FIR
ornaments were committed investigation No. 186/2011) dated February
detected in four on October conducted and 11, 2011 filed before
credit facilities 16, 2009 completed on Thiruvalla Police Station,
availed from the detected date is February against Mr. Devdas. The
Vallamkulam branch on 21, 2011. investigation is currently
of our Bank. February  Form FMR – 1 pending.
21, 2011 dated March 8,  Our Bank filed an original suit
2011 submitted (O.S. 15/2012) before the
to RBI (Ref. No. Subordinate Court, Thiruvalla
CASY1101- against Mr. Devdas, seeking a
0002). decree for recovery of loan
 Staff amount. The matter is currently
accountability pending.
aspects were
examined and
departmental
enquiry was
conducted.
 Extant
instructions on
advance against
pledge of gold is
clear.
64. Loans against the Fraud 1.08  Internal  No legal action has been
pledge of inferior committed investigation initiated.
gold were availed by on conducted and
the relatives of then February completed on
Assistant Manager of 17, 2014 May 1, 2014.
our Vellore branch. detected  Form FMR – 1
on August dated March 18,
1, 2014 2015 submitted
to RBI (Ref. No.
CASY1501-
0004).
 Staff
accountability
aspects were

305
 examined.
 The amount was
fully recovered
and the liability
was closed on
July 9, 2014.
65. A co-operative credit Fraud 8.10  Internal  First information report (FIR
society having a committed investigation No. 216/2014) filed before
current account with on January conducted and Gamdevi Police Station against
Bhayander branch of 3, 2014 completed on miscreants by the relevant
our Bank, detected date is February department of Air India airlines
fraudulently on 26, 2015. and the chairman of the co-
encashed two drafts, February  Form FMR – 1 operative society was arrested.
using fake 26, 2015 dated February  No legal action has been
endorsements of Air 27, 2015 initiated by our Bank.
India officials. submitted to RBI
(Ref. No.
CASY1501-
0003).
 Staff
accountability
aspects were
examined.
 The concerned
branch manager
was suspended
on March 23,
2015.

Other than the matters disclosed above, details of criminal proceedings initiated by our Bank are as follows:

1. Our Bank filed a criminal case (C.M.P. No. 1162B/2012) dated September 20, 2012 before the Chief Judicial
Magistrate Court, Thrissur which was subsequently taken cognisance of and reclassified as calendar case (C.C.
No. 357/2013) against Mr. P.K. Balasubramanian, Ms. Shobhana Balasubramanian and Mr. Bharath
Balasubramanian, being directors of M/s Srivari Trading Company Private Limited and Ms. C.A. Parvathy
Ammal as a guarantor under the relevant loan facility, in relation to the alleged acts of cheating, dishonest
misappropriation and conversion of properties secured for the eight loans availed by the accused persons from
our Bank in January 2010, with cash credit facilities aggregating to ` 199.10 million and machinery loans
amounting to ` 23.90 million on behalf of the company and its subsidiaries. The accused persons hypothecated
certain machinery, stock-in-trade and mortgaged certain immovable properties to avail the loans. The accused
persons allegedly did not operate the credit facilities properly and also defaulted in repayments towards the
machinery loans. On June 30, 2010, all accounts of the company became irregular and by September 30, 2010,
all accounts became non-performing accounts. Our Bank initiated recovery proceedings and securitisation
proceedings, consequent to which certain loan facilities were closed, resulting in an outstanding amount of
` 111.73 million as on October 15, 2012. Meanwhile, the accused persons had allegedly removed,
misappropriated and converted the entire machinery hypothecated in favour of our Bank in their favour, and our
Bank filed the complaint against such actions. The matter is currently pending.

On June 27, 2014, Mr. Bharath B. and Mr. P.K. Balasubramanian and other directors of M/s Srivari Trading
Company Private Limited filed criminal miscellaneous cases (Crl. M.C. No. 3517/2014 and 3518/2014,
respectively), before the High Court of Kerala at Ernakulam, seeking quashing of C.C. No. 357/2013 instituted
by our Bank, which was disallowed by the High Court pursuant to an order dated August 22, 2014. As such,
C.C. No. 357/2013 is currently pending.

2. Our Bank filed a criminal complaint (C.C. No. 404/2011) dated June 21, 2011 before the Judicial Magistrate

306
 First Class, Pune Cantonment, against Mr. Abdul Kadir Jaffari and Mr. Imtiyaz Mohammad Jaffari, contending
that Mr. Abdul Kadir Jaffari misrepresented to our Bank, as being the owner of our earlier Pune branch
premises and induced us to enter into a leave and license agreement on two occasions, dated July 1, 1996 and
December 7, 2006, whereas the property was already transferred by him in favour of Mr. Imtiyaz Mohammad
Jaffari in the year 1994 by oral partition, which was duly recorded in a memorandum and confirmed by a deed
of confirmation dated January 28, 2002. In the complaint, our Bank contended that Mr. Abdul Kadir Jaffari
required our Bank to furnish ` 0.66 million as security deposit, a refund of which was claimed by our Bank
upon shifting out of the said premises, which was not returned. Our Bank filed a complaint with police on June
16, 2011. However, since no action was taken, our Bank filed the present criminal case seeking cognizance and
trial of offences committed by the accused persons. The matter is currently pending.

3. Our Bank filed a first information report (FIR No. 37 of 2014) dated May 21, 2014 before the Sub-Inspector of
Police, Control Crime branch, Madurai, against Mr. R. Ramar, a customer of Madurai branch of our Bank and
against Mr. Manoj Kumar, Partner, M/s Shimmavahani Motors. In our complaint, our Bank stated that Mr. R.
Ramar availed a motor vehicle loan of ` 1.20 million on February 6, 2013 and the proceeds of the said loan
were issued by demand draft, in favour of M/s Shimmavahani Motors, which was subsequently encashed.
Thereafter, the borrower did not submit requisite post disbursal documents with our Bank. Our Bank issued a
legal notice seeking requisite post disbursal documents, however, the said notice was not complied with.
Further, in our complaint, our Bank stated that the borrower had defaulted in the repayment of the credit
facility. Our Bank filed a criminal complaint against accused for the offence of cheating against our Bank and
misappropriating the proceeds of loan for the purposes other than availed for. The investigation is currently
pending.

4. Our Bank lodged a first information report (FIR No. 1488/2014) dated November 4, 2014 before the Sector 14
Gurgaon Police Station, against Mr. Surya Prakash who had intentionally damaged the screen of an ATM of our
Bank on October 26, 2014, resulting in a loss of ` 45,000 to our Bank. The investigation is currently pending.

5. The branch manager of the Thatttayil branch of our Bank lodged a first information report (FIR No. 920/2009)
dated November 18, 2009 with the Pandalam Police Station, regarding an attempted theft at the branch. Certain
unknown suspects had entered into our branch premises by breaking grills, gates and attempted theft at our
branch. The investigation is currently pending.

Recovery proceedings

Notices issued under the SARFAESI Act

The SARFAESI Act provides banks and other lenders increased powers in the recovery of the collateral underlying
NPAs in accordance with RBI guidelines. Under the provisions of the SARFAESI Act, our Bank, as a secured
creditor may, in respect of loans classified as NPAs, issue a written notice (“SARFAESI Notice”) to the relevant
borrowers, requiring it to discharge its liabilities within 60 days, failing which the our Bank may take possession of
the assets constituting the security for the loan, and exercise management rights in relation thereto, including the
right to sell or otherwise dispose of the assets. As on March 24, 2015, there are 311 outstanding notices which our
Bank has issued under the SARFAESI Act, involving an aggregate amount, to the extent quantifiable, of ` 3,224.68
million. There are 43 such notices, which involve an amount equal to or above ` 10 million. Details of such notices
are provided under the section titled “ – Cases filed by our Bank – Recovery proceedings - Proceedings before debt
recovery tribunals and civil recovery suits” beginning at page 312 and below:

1. Our Bank issued a demand notice dated October 15, 2014 under Section 13(2) of the SARFAESI Act against
M/s Arjun Associates, its partners, and others, seeking the repayment of amount due under cash credit facility
sanctioned by our Bank to Arjun Associates, failing which our Bank would take recourse to remedies under
Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 51.21 million with interest at 20.25%
p.a. with monthly rests and penal interest at 1% from October 1, 2014, and charges and costs of the proceedings
till repayment. The matter is currently pending.

2. Our Bank issued a demand notice dated January 30, 2013 under Section 13(2) of the SARFAESI Act against
Ms. E.R. Bindumol, proprietor of M/s Deawoo Trading Company, Mr. K.P. Manoj Kumar, proprietor of M/s

307
 Deawoo and Sundek Industries, and Mr. E.R. Behesh as the guarantor, seeking the repayment of amount due
under two overdraft and two machinery loan facilities sanctioned by our Bank to the two proprietary concerns,
failing which our Bank would take recourse to remedies under Section 13(4) of the SARFAESI Act. The
amount of claim involved is ` 13.16 million as on December 31, 2012 with further interest at 17.75% p.a. on `
2.95 million, 19.75% p.a. on ` 2.21 million, 18.50% p.a. on ` 3.48 million, 16.75% p.a. on ` 4.51 million
respectively with monthly rests and penal interest at 1% p.a. from January 1, 2013 till repayment, with costs and
expenses. The matter is currently pending.

3. Our Bank issued a demand notice dated July 30, 2014 under Section 13(2) of the SARFAESI Act against Sree
Tirumala Traders (“Tirumala”) through its proprietor, Mr. Jaikumar N; Ms. B.S. Lakshmi and Mr. K.P.
Selvaraj as guarantors, seeking the repayment of amount due under cash credit facility and adhoc limits
sanctioned by our Bank to Tirumala, failing which our Bank would take recourse to remedies under Section
13(4) of the SARFAESI Act. The amount of claim involved is ` 48.75 million with interest at 20.75% p.a. with
monthly rests and penal interest at 1% from July 1, 2014, and costs till repayment. The matter is currently
pending.

4. Our Bank issued a demand notice dated March 20, 2015 under Section 13(2) of the SARFAESI Act against M/s
Amala Trading Company (“Amala”); Mr. Wilson Thomas, the proprietor of Amala; Mr. P.M. Joseph and Ms.
Rajani Thomas as guarantors, and others, seeking the repayment of amount due under cash credit facility
sanctioned by our Bank to Amala, failing which our Bank would take recourse to remedies under Section 13(4)
of the SARFAESI Act. The amount of claim involved is ` 44.45 million with interest at 14.50% p.a. with
monthly rests and penal interest at 1% p.a. from March 1, 2013 till repayment, and costs of proceedings till
repayment. The matter is currently pending.

5. Our Bank issued a demand notice dated August 26, 2014 under Section 13(2) of the SARFAESI Act against
Monu Mia Plantations Private Limited (“MMPL”), and others, seeking the repayment of amount due under
working capital, term loan and agricultural term loan facilities sanctioned by our Bank to MMPL, failing which
our Bank would take recourse to remedies under Section 13(4) of the SARFAESI Act. The amount of claim
involved is ` 37.60 million with interest at 18.75% p.a. with monthly rests, penal interest of 1% from August 1,
2014 till repayment and costs of proceedings till repayment. The matter is currently pending.

6. Our Bank issued a demand notice dated January 13, 2015 under Section 13(2) of the SARFAESI Act against
M/s Dee Cee Hospitalities (“DCH”), a partnership firm, its partners, seeking the repayment of amount due
under term loan facility sanctioned by our Bank to DCH, failing which our Bank would take recourse to
remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 33.88 million as on
December 31, 2014 with future interest at 15.50% p.a. with monthly rests and penal interest at 2% from January
1, 2015 till repayment. The matter is currently pending.

7. Our Bank issued a demand notice dated October 21, 2014 under Section 13(2) of the SARFAESI Act against
Niumec Engineering Corporation (“NEC”) and Mr. Baldeep Kaur Mander, seeking the repayment of amount
due under cash credit and bank guarantee facilities sanctioned by our Bank to NEC, failing which our Bank
would take recourse to remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is `
30.57 million as on September 30, 2014 with interest at 15.50% p.a. with monthly rests and penal interest at 1%
from October 1, 2014 till repayment. The matter is currently pending.

8. Our Bank issued a demand notice dated October 10, 2014 under Section 13(2) of the SARFAESI Act against
M/s Soundarya Corporate, a partnership, its partners, and others, seeking the repayment of amount due under
cash credit facility sanctioned by our Bank to Soundarya Corporate, failing which our Bank would take recourse
to remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 28.94 million with
interest at 20.25% p.a. with monthly rests and penal interest at 1% from October 1, 2014, and other charges and
costs till the date of repayment. The matter is currently pending.

9. Our Bank issued a demand notice dated October 17, 2014 under Section 13(2) of the SARFAESI Act against
Mr. C. Venkatesan and Mr. C. Vivekanandan as borrowers, and guarantors, seeking the repayment of amount
due under lease rental discounting facility sanctioned by our Bank, failing which our Bank would take recourse
to remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 28.15 million with

308
 interest at 20.75% p.a. with monthly rests and penal interest at 1% from October 1, 2014, and costs of
proceedings till repayment. The matter is currently pending.

10. Our Bank issued a demand notice dated October 31, 2014 under Section 13(2) of the SARFAESI Act against
M/s Alvenia Exports, seeking the repayment of amount due under packing credit limit, cash credit and
machinery term loan facilities sanctioned by our Bank to Alvenia, failing which our Bank would take recourse
to remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 27.05 million with
interest at 21.75% p.a. with monthly rests towards packing credit limit and interest at 20.75% p.a. with monthly
rests towards cash credit and machinery term loan limit from October 1, 2014, and costs, till repayment. The
matter is currently pending.

11. Our Bank issued a demand notice dated June 16, 2014 under Section 13(2) of the SARFAESI Act against P.P.
Advertisers and Printers Private Limited and others, seeking the repayment of amount due under machinery
loans and cash credit limits sanctioned by our Bank, failing which our Bank would take recourse to remedies
under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 22.36 million with interest at
14.25% on the cash credit limits and 15% on the machinery loans with monthly rests from June 1, 2014 till
repayment. The matter is currently pending.

12. Our Bank issued a demand notice dated September 12, 2014 under Section 13(2) of the SARFAESI Act against
Trueik Engineering Private Limited and others, seeking the repayment of amount due under machinery loan,
mortgage loan and cash credit facilities sanctioned by our Bank, failing which our Bank would take recourse to
remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 15.31 million with
interest at 14% with monthly rests from September 1, 2014 till repayment. The matter is currently pending.

13. Our Bank issued a demand notice dated December 15, 2014 under Section 13(2) of the SARFAESI Act against
M/s Meicko Granites (“Meicko”), its partners, and others seeking the repayment of amount due under packing
credit limit facility sanctioned by our Bank, failing which our Bank would take recourse to remedies under
Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 13.69 million with future interest at
20% p.a. with quarterly rests and penal interest at 2% from December 1, 2014 till the date of repayment. The
matter is currently pending.

14. Our Bank issued a demand notice dated January 22, 2015 under Section 13(2) of the SARFAESI Act against
Faces Family Saloons Private Limited, and others seeking the repayment of amount due under overdraft facility
sanctioned by our Bank, failing which our Bank would take recourse to remedies under Section 13(4) of the
SARFAESI Act. The amount of claim involved is ` 13.20 million with future interest at 16.25% p.a. with
monthly rests and penal interest at the rate of 1% from January 1, 2015 till repayment. The matter is currently
pending.

15. Our Bank issued a demand notice dated October 21, 2014 under Section 13(2) of the SARFAESI Act against
M/s Rajesh Steel and Furniture, Mr. Rajesh Lakshamsi Maru, Ms. Sureka Rajesh Maru, and Mr. Priyank Rajesh
Maru, seeking the repayment of amount due under cash credit facility sanctioned by our Bank, failing which our
Bank would take recourse to remedies under Section 13(4) of the SARFAESI Act. The amount of claim
involved is ` 13.14 million with interest at 14.05% p.a. with monthly rests and penal interest at 2% from
October 1, 2014, and costs of proceedings till repayment. The matter is currently pending.

16. Our Bank issued a demand notice dated January 29, 2015 under Section 13(2) of the SARFAESI Act against
M/s Jhajj Rent A Cab, seeking the repayment of amount due under overdraft and motor vehicle loan facilities
sanctioned by our Bank, failing which our Bank would take recourse to remedies under Section 13(4) of the
SARFAESI Act. The amount of claim involved is ` 12.44 million with interest at 17.50% on the overdraft limit
of ` 2 million, 12.25% and 12.50% on the motor vehicle loan limits of ` 8.50 million and ` 1.94 million,
respectively, till repayment. The matter is currently pending.

17. Our Bank issued a demand notice dated January 30, 2013 under Section 13(2) of the SARFAESI Act against
Hebron Aqua and Food Private Limited and others, seeking the repayment of amount due under cash credit,
adhoc limits and term loan facilities sanctioned by our Bank, failing which our Bank would take recourse to
remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 12.40 million as on

309
 December 31, 2012 with further interest at 17.75% p.a. with monthly rests and penal interest at 1% p.a. from
January 1, 2013 till repayment, and other costs and expenses. The matter is currently pending.

18. Our Bank issued a demand notice dated July 16, 2014 under Section 13(2) of the SARFAESI Act against M/s
Apex Constructions, Mr. Siju Nicholas, the proprietor, and Ms. Leena Saju seeking the repayment of amount
due under overdraft facilities on mortgage sanctioned by our Bank, failing which our Bank would take recourse
to remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 10.89 million as on
June 30, 2014 with future interest at 20.25 % p.a. with monthly rests and penal interest at 1% from July 1, 2014
till repayment. The matter is currently pending.

19. Our Bank issued a demand notice dated August 6, 2014 under Section 13(2) of the SARFAESI Act against M/s
Premier Yarn Textiles, Mr. A. Vasudevan, and Ms. V. Saraswathi seeking the repayment of amount due under
cash credit limit facility sanctioned by our Bank, failing which our Bank would take recourse to remedies under
Section 13(4) of the said Act. The amount of claim involved is ` 10.23 million as on July 31, 2014with interest
at 18.25% p.a. with monthly rests and penal interest at 2% from August 1, 2014, and costs till repayment. The
matter is currently pending.

20. Our Bank issued a demand notice dated October 31, 2014 under Section 13(2) of the SARFAESI Act against
M/s View Cube Digital Media, Mr. P.M. Niyas, Mr. Hanish Babu and others, seeking the repayment of amount
due under overdraft facilities sanctioned by our Bank, failing which our Bank would take recourse to remedies
under Section 13(4) of the said Act. The amount of claim involved is ` 10.22 million as on October 31, 2014
with further interest at 17.75% p.a. with monthly rests and penal interest at 1% p.a. from November 1, 2014 till
repayment , and other costs and expenses. The matter is currently pending.

21. Our Bank issued a demand notice dated October 31, 2014 under Section 13(2) of the SARFAESI Act against
M/s Pranavam Cashew Company, Mr. S. Sreekumar, and Ms. V. Vijayarani, seeking the repayment of amount
due under cash credit facilities sanctioned by our Bank, failing which our Bank would take recourse to remedies
under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 27.36 million as on October 31,
2014 with further interest at 17.75% p.a. with monthly rests and penal interest at 1% p.a. from November 1,
2014 till repayment, and other costs and expenses. The matter is currently pending.

Proceedings filed by our Bank pursuant to the SARFAESI Notices

Further to the SARFAESI Notices, our Bank may initiate proceedings for the possession of the properties and other
assets constituting the security furnished with respect to the outstanding borrowings. As on March 24, 2015, our
Bank has initiated 26 civil proceedings which are pending and the aggregate amount, to the extent quantifiable, is
approximately ` 118.31 million. Symbolic possession has been obtained in most of the proceedings. There are three
such proceedings, which involve an amount equal to or above ` 10 million. Details of such proceedings involving an
amount equal to or above ` 10 million are provided under the section titled “ – Cases filed by our Bank – Recovery
proceedings - Proceedings before debt recovery tribunals and civil recovery suits” beginning at page 312 and
below:
1. Our Bank issued a demand notice dated October 15, 2013 under Section 13(2) of the SARFAESI Act against
M/s Flora Technologies, a partnership firm, and its partners, seeking the repayment of amount due under a cash
credit facility sanctioned by our Bank, failing which our Bank would take recourse to remedies under Section
13(4) of the said Act. The amount of claim involved was ` 26.48 million as on September 20, 2013 with further
interest at 16.25% p.a. with monthly rests and penal interest at 1% p.a. from October 1, 2013 till repayment, and
costs and expenses. Pursuant to the same, our Bank filed a miscellaneous petition dated March 16, 2015 beofre
the Chief Metropolitan Magistrate, Ernakulam for: a) appointment of a commissioner to take physical
possession of security properties and direction to the commissioner to hand over the said properties to our Bank,
b) police assistance to be provided to allow the commissioner to take physical possession. The amount of claim
involved is ` 26.48 million with further interest at 16.25% p.a. with monthly rests and penal interest at 1% p.a.
from October 1, 2013 till repayment, and costs and expenses. The matter is currently pending.
Proceedings filed against our Bank pursuant to the SARFAESI Notices

Further to the SARFAESI Notices, the relevant borrowers may also initiate legal proceedings challenging the notice

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issued for recovery of outstanding borrowings. Currently there are 47 civil proceedings which are pending and the
aggregate amount, to the extent quantifiable, is approximately ` 665.51 million. There are nine such proceedings,
which involve an amount equal to or above ` 10 million. Details of such proceedings involving an amount equal to
or above ` 10 million are provided under the section titled “ – Cases filed by our Bank – Recovery proceedings -
Proceedings before debt recovery tribunals and civil recovery suits” beginning at page 312, and below:

1. Our Bank issued a notice dated September 30, 2013 under Section 13(2) of SARFAESI Act against M/s Devus
Trading Company, the proprietary concern of Mr. K. Suresh, and others seeking the repayment of an overdraft
facility sanctioned by our Bank, failing which our Bank would take recourse to the remedies under Section
13(4) of the SARFAESI Act. The amount of claim involved was ` 10.97 million as on August 31, 2013 with
further interest at 15.50% p.a. with monthly rest and penal interest at 1% p.a. from September 1, 2013 till
repayment, and costs and expenses. Thereafter, Mr. A.R. Unnikrishnan, in his capacity as a guarantor,
approached the High Court of Kerala at Ernakulam on many occasions for permission to pay in installments and
for extension of time. Pursuant to one such writ petition dated December 6, 2014, the High Court of Kerala at
Ernakulam passed an order dated February 13, 2015 holding that the petition seeking further grant of
installments cannot be maintained. Further, Mr. A.S. Fazil filed a writ petition dated February 5, 2015 before
the High Court against our Bank and others in relation to the property that was purchased by him from Mr. K.
Suresh and that was also a security property under the overdraft facility sanctioned by our Bank. Mr. Fazil has
prayed for appropriate writs to be issued: a) quashing the auction sale notice in relation to the said property, b)
directing our Bank to not proceed against the said property before proceeding against the other properties
offered as security to our Bank. Mr. Fazil also filed an interim application for the stay of proceedings pursuant
to auction sale notice of the property, which was granted by the High Court through an order dated February 13,
2015. The matter is currently pending.

2. Our Bank issued a notice dated July 29, 2014 under Section 13(2) of SARFAESI Act against M/s Sylcon
Trading Establishment (“Sylcon”), a partnership firm, its partners and others, seeking the repayment of cash
credit and term loan facilities sanctioned by our Bank, failing which our Bank would take recourse to the
remedies under Section 13(4) of the SARFAESI Act. The amount of claim involved is ` 29.34 million as on
July 26, 2014 with further interest at 20.75% p.a. with monthly rest and penal interest at 1% p.a. from July 1,
2014 till repayment, and costs and expenses. Against the said notice, Sylcon and Mr. Shiraz K.V., managing
partner of Sylcon, filed a securitisation application dated February 15, 2014 before the DRT, Ernakulam for a
declaration that the proceedings initiated under the SARFAESI Act by our Bank are illegal. The matter is
currently pending. Sylcon and Mr. Shiraz also filed an interim application dated December 15, 2014 for a stay
of all further proceedings under the SARFAESI Act and in pursuance of the possession notice dated December
4, 2014 issued by our Bank. The DRT through an order dated December 17, 2014 directed our Bank to defer
coercive possession of the security property if and only if a sum of ` 2.5 million is remitted thrice by Sylcon
and Mr. Shiraz on or before December 31, 2014, January 26, 2014, and February 28, 2014, respectively.
Thereafter, Sylcon and Mr. Shiraz filed another interim application dated January 22, 2015 praying for an
advance hearing in relation to the securitization application and for enlargement of time. The DRT passed an
order dated February 13, 2015 granting time till March 31, 2015 for payment of ` 7 million.

3. Our Bank issued a notice dated July 29, 2014 under Section 13(2) of SARFAESI Act against M/s Neha Leather
(“NL”), a partnership firm, its partners and others, seeking the repayment of cash credit, term loan and vehicle
loan facilities sanctioned by our Bank, failing which our Bank would take recourse to the remedies under
Section 13(4) of the said Act. The amount of claim involved is ` 50.63 million as on July 26, 2014 with further
interest at 20.75% p.a. on ` 45.94 and ` 0.76 million and at 12.25% p.a. on ` 3.93 million with monthly rest and
penal interest at 1% p.a. from July 1, 2014 till repayment, and costs and expenses. Against the said notice, NL
and Mr. Shiraz K.V., managing partner of NL filed a securitization application dated December 15, 2014 before
the DRT, Ernakulam for a declaration that the proceedings initiated under the SARFAESI Act by our Bank are
illegal. NL and Mr. Shiraz also filed an interim application dated December 15, 2014 for a stay of all further
proceedings under the SARFAESI Act and in pursuance of the possession notice dated December 4, 2014
issued by our Bank. The DRT through an order dated December 17, 2014 directed our Bank to defer coercive
possession of the security property if and only if: a) ` 3 million is remitted on or before December 31, 2014, b)
` 3 million is remitted on or before January 26, 2015, c) ` 4 million is remitted on or before February 28, 2015.
Thereafter, NL and Mr. Shiraz filed another interim application dated January 22, 2015 praying for an
enlargement of time for compliance with the second and third conditions in the interim order dated December

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 17, 2014. The DRT passed an order dated February 13, 2015 granting time till March 31, 2015 for payment of `
7 million. The matter is currently pending.

4. Our Bank issued a notice dated July 31, 2014 under Section 13(2) of SARFAESI Act against M/s Joy Luck
Men’s Hub (“JLMH”), M/s Joy Luck Vivah Silks (“JLVS”), M/s Joy Luck Agencies (“JLA”), and their
proprietors, seeking the repayment of amount due under facilities sanctioned by our Bank, failing which our
Bank would take recourse to the remedies under Section 13(4) of the said Act. The amount of claims involved
are as follows:
a) against the proprietor of JLMH, ` 44.33 million as on July 31, 2014 with further interest at 17.25% p.a.
with monthly rest from August 1, 2014 till date of repayment
b) against the proprietors of JLVS and JLA, ` 95 million as on July 31, 2014 with further interest at 15.5%
p.a. on ` 94.20 million and 18.75% p.a. on ` 0.80 million with monthly rests from August 1, 2014 till
repayment, and
c) 1% penal interest on the balances outstanding
Against the said notice, Mr. Joy Manthra, proprietor of M/s Joy Luck Vivah Silks, has filed a securitization
application dated December 13, 2014 before the DRT, Ernakulam, seeking an order inter-alia for: a) declaration
that our Bank is not entitled to proceed against the secured asset, b) declaration that our Bank is entitled to
realize interest at 15% only, c) award of costs. The matter is currently pending.

Proceedings before debt recovery tribunals and civil recovery suits

In the ordinary course of our banking business, we have initiated numerous legal proceedings for recovery of debts,
which are at various stages of adjudication, and partial recovery has been effectuated in certain proceedings. Parties
may also initiate proceedings before various forums, and under different acts or regulations, for recovering the same
dues, details of which have been provided hereinbelow. As on March 24, 2015, there are 3,302 pending proceedings
for recovery of debts filed by our Bank, and the aggregate claim, to the extent quantifiable, is approximately `
1,962.87 million. There are 27 recovery proceedings which involve an amount of ` 10 million or more. Details of
such proceedings for recovery of debts, which involve an amount of ` 10 million or more are as follows:

1. Our Bank sanctioned a cash credit facility of ` 20 million to M/s Well Worth Plastics (“Well Worth”), a
partnership firm. Since Well Worth violated certain terms and conditions of the said cash credit facility and
defaulted in its repayment, our Bank issued a notice dated November 15, 2011 under Section 13(2) of the
SARFAESI Act and subsequently took possession of secured assets and sold the same.

Our Bank also filed an original application dated March 27, 2013 under the RDDBFI Act against Well Worth
and its partners before the DRT, Ernakulam, seeking the recovery of ` 26.80 million the defendants along with
future interest at the rate of 15.5% p.a. with monthly rests and penal interest at the rate of 1% p.a. from March
26, 2013 till realization, and costs from the defendants, their properties, and the properties mortgaged with our
Bank. Our Bank also prayed for an interim injunction restraining the defendants and their men from alienating
the mortgaged property and from committing any waste/ damage till the disposal of the application. Pursuant to
the same, the DRT passed an interim order dated April 12, 2013 allowing the said original application. The said
order of injunction was made absolute on May 29, 2014. Thereafter, the DRT passed an order dated September
16, 2014 holding that: a) our Bank was entitled to recover ` 26.65 million with interest on the sum of ` 26.43
million at 12% p.a. from March 27, 2013 till the date of the final order and thereafter at 11% p.a. till realization,
and proportionate costs from the defendants jointly and severally and their assets, b) our Bank shall credit `
10.21 million on June 3, 2013 and sum of ` 15.66 million on December 14, 2013 realized from the aforesaid
sale of assets, c) vacating the injunction granted under order dated April 12, 2013 as our Bank had proceeded
under SARFAESI Act and sold those properties in respect of which interim injunction was prayed for. The
matter is pending for recovery.

2. Our Bank sanctioned a term loan of ` 600 million to M/s. Surya Pharmaceuticals Limited (“SPL”). SPL
defaulted in repayment of the said term loan and subsequently it was classified as a NPA. SPL filed a reference
dated August 5, 2013 before BIFR for a declaration as a sick company. Furthermore, our Bank filed an original
application dated May 22, 2014 under the RDDBFI Act before the DRT-I, Chandigarh against SPL, Mr. Rajiv
Goyal and Ms. Alka Goyal as guarantors, and others for the recovery of ` 775.71 million, and pendenlite future
interest at 14.5% p.a. from May 26, 2014 till the date of the realization of the said amount. In addition, our Bank

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 has prayed for: a) sale of mortgaged property, the proceeds of which shall be appropriated towards the amount
due from SPL, b) in the event of insufficiency of such proceeds, an order directing the payment of such
deficient sum or the sale out of the personal assets of the defendants, and c) award of costs. Further, our Bank
also prayed for interim reliefs: a) restraining SPL from disposing or parting with the possession of the properties
of the guarantors that were charged with the Bank by way of hypothecation or mortgage b) attachment and sale
of the properties of the guarantors, c) appointment of a receiver to manage and take custody of the mortgaged
and hypothecated properties.

Our Bank initiated proceedings against SPL by serving a demand notice under Section 13(2) of SARFAESI Act
on August 8, 2013, which was challenged by SPL before the High Court of Jammu and Kashmir. Pursuant to an
order dated October 9, 2013, the High Court stayed the proceedings, consequent to which the SARFAESI
proceedings were withdrawn and the stay was subsequently vacated. A fresh notice was issued under Section
13(2) of the SARFAESI Act on December 8, 2014. The matters are currently pending.

3. Our Bank sanctioned certain overdraft facilities and machinery loans for an amount of ` 686.40 million to Mr.
P. Senthil Kumar, the proprietor of M/s Iswari Spinning Mills. Since Mr. Kumar defaulted in repayment of the
said credit facilities, our Bank issued a demand notice dated December 23, 2014 under Section 13(2) of the
SARFAESI Act, seeking repayment within 60 days of the date of notice, failing which our Bank would take
recourse to rights under Section 13(4) of the SARFAESI Act.

Further, our Bank filed an original application dated January 12, 2015 under of the RDDBFI Act before DRT,
Madurai against Mr. Senthil Kumar and Ms. P.Saraswathy, in her capacity as guarantor. Our Bank prayed for
the recovery of : a) ` 416.31 million towards overdraft facility as on December 31, 2014 with further interest at
13% p.a. with monthly rests plus 1% penal interest from January 1, 2015 till its realization with costs; b) `
78.98 million towards machinery loans as on December 31, 2014, further interest at 13.50% p.a. with monthly
rests, and 1% penal interest from January 1, 2015 till its realization with costs; Additionally, our Bank also
prayed for: a) sale of hypothecated or mortgaged properties towards satisfaction of debt, in case of insufficiency
of sale proceeds, b) direction that the defendants pay the deficit with interest at 13.50% p.a. compounded
monthly and penal interest at 1% p.a. till realization, out of their assets, and out of the estate of late Mr.
Palaniswamy (father of Mr. Kumar and previously, a guarantor to certain facilities availed by Mr. Kumar).
Further, our Bank filed an interim application for: a) an injunction restraining the defendants and their agents
from alienating any of the mortgaged properties, pending disposal of the application; b) an injunction
restraining Mr. Kumar from operating any other bank account or making any deposit of money from his
business transactions, c) an injunction restraining defendants from fleeing the country by impounding their
passports, d) appointment of a receiver for the business of the proprietary concern of Mr. Kumar, and e)
appointment of a commissioner to take inventory of hypothecated machineries. The matter is currently pending.

4. Our Bank sanctioned an industrial loan of ` 80 million to M/s. Jupiter Bioscience Limited (“Jupiter”) and a
term loan of ` 120 million to Jupiter and Mr.Venkat Kalavakolanu. on October 15, 2009 to M/s. Jupiter
Bioscience Limited (“Jupiter”). Due to defaults committed in repayment, our Bank filed an original application
dated July 24, 2012 under the RDDBFI Act before the DRT, Hyderabad against Jupiter, Mr. Venkat
Kalavakolanu and others. Our Bank has prayed for: a) recovery of ` 263.61 million as on July 17, 2012 by
Jupiter and Mr. Kalavakolanu with interest at 13.5% p.a. payable monthly plus additional interest of 2%, costs
and expenses till the date of realisation, b) direction to Jupiter and Mr. Kalavakolanu to pay all their dues in
terms of the guarantee obligation, c) sale and realization of their assets by public auction or otherwise, d)
direction for enquiry, investigation, examination, attachment and realization of assets of Jupiter and Mr.
Kalavakolanu, f) appointment of a receiver to take possession of properties of Jupiter and Mr. Kalavakolanu.
Further, our Bank also prayed for the following interim reliefs: a) interim injunction restraining Jupiter and Mr.
Kalavakonu or their agents from transferring, alienating or disposing of the properties mortgaged to our Bank,
and appointment of a receiver in relation to such properties, b) direction to Jupiter and Mr. Kalavakolanu to
provide details about their properties and to allow our Bank to investigate if necessary about the same, c) order
impounding passport of Mr. Kalavakolanu.

Our Bank shared charge over the secured assets in relation to the aforesaid facilities with IFCI Limited
(“IFCI”) and other banks. Pursuant to a request from IFCI, our Bank through a letter dated March 27, 2013
consented to share the sale proceeds realized by sale of the said secured assets under SARFAESI Act.

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 Subsequently, Jupiter was ordered to be wound up through an order dated January 10, 2014 by the High Court
of Karnataka and an official liquidator was appointed. The official liquidator through a letter dated September
16, 2014 directed IFCI to deposit the sale proceeds of ` 65.94 million from sale of secured assets of Jupiter.
IFCI has defended its action under SARFAESI Act through a letter dated October 1, 2014 to the official
liquidator. The matters are currently pending.

5. Punjab National Bank Limited (being the consortium leader), our Bank and seven others (“Applicants”), being
consortium lenders under a lending consortium, filed an original application dated March 28, 2014 under the
RDDBFI Act before the DRT, Chennai against M/s. DFL Infrastructure Finance Limited (“DFL”). The matter
relates to the default in repayment of amount due under various facilities aggregating to ` 1300 million
sanctioned by the consortium members to DFL. Our Bank sanctioned ` 850 million out of the said aggregate.
DFL was offered corporate debt restructuring (“CDR”) package. Due to default committed by DFL in
complying with the terms and conditions of the CDR package, the CDR package could not be implemented.
The Applicants preferred this application before the DRT. In relation to our Bank, the application sought for: a)
recovery of ` 159.82 million as on February 28, 2014 with subsequent interest at 18.25% p.a. with monthly
rests towards the overdraft account from the date of application till realization and, award of costs thereon.
Further, the applicants also prayed for the following reliefs: a) in the event of failure to pay, sale of properties
and allow the adjustment of the proceeds towards the outstanding amounts due from the defendants, and
permitting the applicants to proceed against DFL, b) recovery of pendenlite and further interest at the
contracted rates, c) directions for inquiry, investigations, examination. The applicants also prayed for an interim
injunction restraining the defendants or their agents from in any way encumbering, alienating, transferring or
otherwise disposing of the mortgaged properties till the disposal of the application.

Further, the consortium leader also issued a notice dated February 4, 2015 under Section 13(2) of the
SARFAESI Act seeking repayment of the amount due to various consortium members, failing which the
consortium would take recourse to remedies available under Section 13(4) of the SARFAESI Act. An amount
of ` 187.09 million along with further interest and charges was due to our Bank under the said notice. The
matters are currently pending.

6. Our Bank had sanctioned a cash credit facility of ` 155 million and a term loan of ` 15.98 million to M/s Srivari
Trading Company (“Srivari”), as well as additional loans of approximately ` 52.09 million to certain other
members of the Srivari group. The loan facilities became irregular and NPAs. Our Bank issued a demand notice
dated August 10, 2011 under Section 13(2) of the SARFAESI Act, consequent to which the sale proceeds were
adjusted, resulting in an outstanding amount of ` 111.73 million as on October 15, 2012. Srivari filed a
securitization application on December 6, 2012 and an application for interim stay of the proceedings,
challenging the securitization proceedings undertaken by our Bank, and sought a direction to quash the transfer
of secured properties in favour of our Bank, and all further transfers envisaged pursuant to the notices issued
under the securitization proceedings. We understand that a partition suit has been instituted by Mr. Bharat
Balasubramaniam in respect of family property including security property, however, our Bank has not yet
received a formal intimation or notice in this matter.

Thereafter, our Bank filed an application dated October 18, 2012, under the RDDBFI Act before the DRT,
Ernakulam against Srivari, Mr. P.K. Balasubramanian, Ms. Shobhana Balasubramanian and Mr. Bharath
Balasubramanian as directors of the company and Ms. C.A. Parvathy Ammal and M/s Ekadandha Petro
Products (P) Limited as guarantors under the loan facility, for recovery of the outstanding amount along with
interest at the rate of 15.5% p.a. penal interest at the rate of 1% p.a. and costs, along with the issuance of a
recovery certificate by the tribunal to the Recovery Officer. Further, our Bank also filed an interim application
dated October 18, 2012 for attachment before judgment of the amount lying in the fixed deposit account of
Srivari pending disposal of the original application. The DRT passed an order dated November 2, 2012 granting
an attachment before judgment of fixed deposit of ` 0.84 million belonging to one of the defendants with
interest accrued, subject to the prior existing lien on the fixed deposit account. The matters are currently
pending.

7. Our Bank sanctioned various facilities aggregating to ` 70 million to Malabar Sand and Stones Private Limited
(“MSSPL”). Since MSSPL defaulted in repayment, our Bank initiated securitisation proceedings pursuant to
demand notice dated March 16, 2012 issued to MSSPL under Section 13(2) of the SARFAESI Act. Against the

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 same, Mr. Haris Cherattiadan, managing director of MSSPL, filed a securitisation application dated December
19, 2012 before the DRT, Ernakulam for: a) declaration that possession of secured assets of MSSPL by our
Bank is illegal, an order setting aside all the steps taken by our Bank under the SARFAESI Act, and for
payment of compensation to MSSPL for the losses suffered due to the alleged illegal acts of our Bank. The
DRT passed an interim order dated September 10, 2013 directing MSSPL to pay ` 20 million in four
installments. After the payment of the first installment, MSSPL approached the DRAT for stay of further
conditions imposed by the DRT in relation to repayment. The DRAT through an order dated October 28, 2013
directed the payment of a sum of ` 15.70 million on or before December 31, 2013. Against the said order of the
DRAT, MSSPL approached the High Court on various occasions. The High Court through an order dated
September 24, 2014 condoned the delay and pursuant to the said order, the DRAT stayed further conditions
imposed in order dated September 10, 2013.

Furthermore, our Bank filed an original application dated August 13, 2012 under RDDBFI Act against MSSPL,
two of its directors, the guarantors and others, seeking: a) payment of a ` 88.94 million and expenses incurred
or to be incurred in the recovery of the debts, b) participation in the auction proceedings without depositing the
earnest money deposit, c) declaration that our Bank as a secured creditor shall have priority over the sale
proceeds of the mortgaged property, d) defendants be held personally liable for the claim amount along with
interest and costs, f) direction to the defendants to pay contingent liabilities like insurance premium, costs, and
other expenses that may be incurred subsequent to the date of filing of the application. Our Bank also prayed for
an interim injunction restraining the defendants and their agents from transferring or alienating or otherwise
disposing of the mortgaged or hypothecated properties. The matters are currently pending.

8. Our Bank sanctioned a cash credit facility of ` 50 million to Padmini Jewellers Private Limited (“PJPL”). Since
PJPL defaulted in its repayment, the account of PJPL became a NPA. Thereafter, our Bank filed an original
application dated December 17, 2012 under RDDBFI Act against PJPL, , and its directors and guarantors, and
others before the DRT-I, Kolkata, seeking inter-alia: a) the recovery of ` 55.76 million, b) payment of interim
interest and interest upon the aforesaid amount at 20.75% p.a. and penal interest at 2% p.a. from December 13,
2012 with monthly rests till realization, c) declaration that our Bank has first and paramount charge over the
assets hypothecated or mortgaged to us, d) injunction restraining the defendants from encumbering, dealing
with, or disposing off the said assets, e) direction for sale of the said assets and for the proceeds therefrom to be
made over to our Bank for protanto satisfaction of our claims, f) appointment of a receiver or special officer for
the said assets, g) attachment of hypothecated and mortgaged assets, h) award of costs. Further, our Bank also
prayed for: a) an injunction restraining the defendants and their agents from encumbering, disposing off,
alienating, or transferring the assets, b) appointment of a receiver or special officer to make inventory of the
assets. The matter is currently pending.

9. Our Bank sanctioned an overdraft facility of ` 50 million to Univision Health Care Limited (“Univision”).
Thereafter, the account of Univision became irregular due to repayment defaults. Therefore, our Bank issued a
demand notice dated September 1, 2010 under SARFAESI Act and took possession of certain properties
belonging to Univision and Mr. Hiren Sangharajka, a director of Univision. The proceeds from the sale of the
said properties were adjusted towards the amount due to our Bank.

Thereafter, our Bank also filed an original application dated September 17, 2012 under the RDDBFI Act against
Univision, Mr. Arvind Sangharajka and Mr. Hiren Sangharajka in their capacity as directors of Univision, and
another before the DRT-I, Ahemdabad., seeking: a) recovery of ` 54.63 million with further interest at 18.25%
p.a. with monthly rests from the date of filing of the application till satisfaction of the dues from the person and
property of the defendants, b) the defendants be permanently restrained from leaving the country till the
satisfaction of dues, d) award of costs of this application. Further, our Bank prayed for the following interim
reliefs: a) direction to the defendants to disclose full details of their other movable and immoveable assets
whether held by them individually or jointly with any other person. Pursuant to order dated September 17, 2014
of company petition number 167/2010 of the High Court of Gujarat, Univision was ordered to be wound up
Earlier, our Bank filed an application dated July 14, 2014 for impleading the liquidator as a necessary party to
the aforesaid original application dated September 17, 2012, and for amendment of original application. The
matter is currently pending.

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10. Our Bank sanctioned certain working capital facilities amounting to ` 60 million to Soundcraft Industries
Limited (“SCL”). Since SCL defaulted in its repayment, our Bank filed an original application dated February
1, 2005 under the RDDBFI against SCL, Mr. Rajkumar Basanthani, Ms. Seema Basanthani in their capacity as
directors of SCL (together with SCL, “Defendants 1-3” respectively) and others before the DRT-I, Mumbai.
Our Bank prayed for: a) recovery of ` 54.55 million with interest of 15% p.a. compounded at quarterly basis
from the date of filing of the application till realization, b) attachment and sale of assets of defendants 1-3
towards realization of dues towards our Bank. Further, our Bank also prayed for interim reliefs: a) directing
defendants 1-3 to deposit the aforesaid sum pending the disposal of the application and to disclose their assets
on oath, b) an injunction restraining defendants 1- 3 from disposing of or creating any third party rights in their
assets. Thereafter, the DRT passed an order dated September 10, 2009 holding that: a) our Bank is entitled to a
recovery certificate for a sum of ` 54.55 million with further interest of 10% p.a. from the date of application
till realization with costs, b) in the event of default in payment, our Bank is entitled to sell the hypothecated or
mortgaged properties and adjust the proceeds towards due, c) if the sale proceeds are insufficient for the
satisfaction of the debt due, Mr. Rajkumar Basanthani and Ms. Seema Basanthani would be personally liable to
pay the deficiency with interest till realisation. The matter is pending for recovery.

11. Our Bank sanctioned working capital limits of ` 54 million to Chemox Chemical Industries Limited
(“Chemox”) on March 19, 1996. Since Chemox defaulted in its repayment, our Bank filed a recovery suit
against Chemox and others before the High Court at Mumbai on November 24, 1998. Our Bank prayed for the
following reliefs: a) recovery of ` 53.50 million with further interest at 22.75% from date of suit till the
judgment and thereafter at the same rate or at a rate decided by the court, b) declaration that the hypothecation
and mortgage of movable and immoveable properties in our favour is valid, c) direction to Chemox to hand
over possession of goods and hypothecated moveable assets for sale by our Bank and to allow appropriation of
proceeds towards the claim amount, d) direction that book-debts of Chemox may be appropriated towards the
realization of the claim amount, e) personal assets of guarantors be attached and sold, f) pending disposal of the
suit, appointment of a receiver in relation to all hypothecated and mortgaged properties, g) award of costs.
Pursuant to an order in company petition number 544 of 1998, Chemox was ordered to be wound up and an
official liquidator of the High Court was appointed as liquidator of Chemox. Thereafter the matter was
transferred to DRT-I, Mumbai which passed an order dated May 11, 2004: a) directing issue of recovery
certificate for ` 52.31 million with interest at 15.27% p.a. quarterly from the date of application till payment
with costs, b) declaring charge for the aforesaid aggregate amount on hypothecated or mortgaged property in
favour of our Bank and the members of the consortium but subject to the rights of paripassu charge-holders, c)
holding that the right of redemption will extinguished four months after the date of the order. The matter is
currently pending for recovery.

12. Our Bank sanctioned an overdraft cash credit limit of ` 22.50 million on January 30, 2010 and an adhoc cash
credit limit of ` 4.50 million to Mr. K.P. Riyas, proprietor of M/s S.R. Traders (“SRT”). Since Mr. Riyas
defaulted in their repayment, our Bank filed an original application under the RDDBFI Act against Mr. K.P.
Riyas, Ms. Fathima Hashir, Ms. Sheeja Abbas, in their capacity as guarantors before the DRT, Ernakulam. Our
Bank prayed for: a) recovery of ` 41.84 million and pendenlite and future interest at 20.75% p.a. with monthly
rests on ` 41.34 million and penal interest at 1% p.a. on ` 41.34 million from the date of application till
realization, and the award of costs b) sale of immoveable properties after recording our charge and to allowing
the application of sale proceeds towards realization, c) direction to the defendants to pay expenses incurred or to
be incurred in the recovery of debts or during the sale procedure, d) participation of our Bank in the auction
proceedings to be conducted by the recovery officer without depositing earnest money deposit, e) order that our
Bank shall have priority over the sale proceeds of the mortgaged property, f) direction for payment of
contingent liabilities like insurance premium, costs, and other expenses that may be incurred after the filing of
the application. Further, our Bank also prayed for an injunction restraining the defendants or their agents from
transferring, alienating, or otherwise disposing off the immoveable properties. The DRT passed an ex-parte
order dated October 7, 2013 allowing the recovery of a sum of ` 41.84 million with further interest at 18.25%
p.a. on ` 41.34 million with monthly rests from November 27, 2012 till realization, and costs from the
defendants jointly and severally. Mr. Riyas filed an application dated January 12, 2014 to set aside the said ex-
parte order. The matter is currently pending for recovery.

13. Our Bank sanctioned a mortgage loan of ` 16 million, machinery loan of ` 3.60 million, and an overdraft
facility of ` 5 million to M/s K.M. Stone Crusher (“KMSC”), a partnership firm. Since KMSC defaulted in

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 their repayment, our Bank initiated proceedings through the issue of a notice dated December 28, 2010 under
Section 13(2) of the SARFAESI Act.

Our Bank filed an application dated February 21, 2013 under the RDDBFI Act before the DRT, Ernakulam
against KMSC, Mr. C. Ansar, Ms. K.P. Jabeera, and Mr. K. Divakaran, as partners of KMSC. Our Bank prayed
for: a) recovery of ` 41.34 million with future interest at the rate of 20.75% p.a. with monthly rests for the entire
amount and penal interest at 1% p.a. and costs of the proceedings from the defendants, their properties. Further,
our Bank also prayed for an interim injunction restraining the defendants and their men from alienating the
mortgaged properties and from committing waste/ damage till the disposal of the application. The defendants
were declared ex-parte on July 25, 2013. The DRT passed a final order dated September 26, 2013 for: a)
recovery of ` 27.84 million under mortgage loan account with further interest at 18% p.a. on the sum of `
27.34 million with monthly rests from February 22, 2013 till realization from defendants jointly and severally
and by sale of secured assets, b) recovery of ` 5.43 million under machinery loan account with further interest
at 18% p.a. with monthly rests on the sum of ` 5.33 million from February 22, 2013 till realization from
defendants jointly and severally and by sale of secured assets, c) recovery of ` 7.90 million under overdraft
account with further interest at 18% p.a. on the sum of ` 7.76 million with monthly rests from February 22,
2013 till realization from defendants jointly and severally and by sale of secured assets, d) proportionate costs
from the defendants jointly and severally and by the sale of mortgaged properties. Pursuant to a petition dated
January 12, 2014 filed by the defendants and the deposit of ` 2.5 million the DRT passed an order dated June
19, 2014 setting aside the ex-parte order dated September 26, 2013 The matters are currently pending.

14. Our Bank provided a cash credit facility of ` 23 million and a machinery loan of ` 0.70 million to M/s
Kozhikkadan Modern Rice Mill (“KMRM”). Since KMRM defaulted in their repayment and the account of
KMRM became a NPA, our Bank issued a demand notice dated October 15, 2013 under Section 13(2) of the
SARFAESI Act to KMRM, Mr. K.O. Antony, Mr. K.A. Poly, and Mr. K.A. Crawly (partners of KMRM),
seeking repayment within 60 days from the date of notice, failing which our Bank would take recourse to the
remedies under Section 13(4) of the SARFAESI Act. Thereafter, KMRM filed a securitisation application dated
February 19, 2014 before DRT, Ernakulam against our Bank and others seeking: a) preliminary decree
dissolving KMRM in accordance with the Indian Partnership Act, 1932, b) appointment of a receiver to take
over the estate of KMRM and their allotment, c) declaration that all proceedings initiated by our Bank are null
and void, c) recovery of ` 50 million from us for loss, damages and injury, and compensatory costs d)
proceedings to be initiated against our Bank by RBI under Section 27 and 28 of the SARFAESI Act. Further,
KMRM filed an interim application dated February 19, 2014 for the stay of auction sale of mortgaged properties
till the disposal of the application. The DRT passed an interim order dated September 1, 2014 with respect to
one item of security property, permitting the scheduled sale to go on, and ordering us to await its order for
confirmation of sale. The confirmation of sale is pending in respect of this item. Thereafter, another interim
order dated February 3, 2015 was passed in relation to another item of security property, allowing the sale, and
requiring our Bank to await further orders with respect to confirmation of sale if and only if a sum of ` 5 million
each is paid by KMRM on or before February 28, 2015 and on or before March 31, 2015, respectively. Our
Bank also filed a miscellaneous petition dated November 11, 2014 before the Chief Metropolitan Magistrate,
Ernakulam for: a) appointment of a commissioner to take physical possession of the security property and hand
it over to us within 15 days of appointment, b) necessary police assistance to be provided to the said
commissioner. We understand that Mr. Garvasi and others have filed a partition suit in respect of the security
property. However, we have not received any official intimation or notice in this regard.

Furthermore, our Bank filed an original application dated August 21, 2014 under the RDDBFI Act before the
DRT, Ernakulam against KMRM, Mr. K.O. Antony, Mr. K.A. Poly, and Mr. K.A. Crawly in their capacity as
partners of KMRM, seeking: a) recovery of ` 28.53 million with future interest at the rate of 15.25% p.a. with
monthly rests and penal interest at the rate of 1% p.a. from August 21, 2014 till realization, and costs, from the
defendants, their properties and properties mortgaged with our Bank. Further, pursuant to an interim application
dated August 21, 2014 preferred by our Bank, the DRT passed an order on September 4, 2014 granting a
temporary injunction restraining the defendants and their men from transferring, alienating, encumbering or
disposing of the mortgaged or hypothecated properties. The matters are currently pending.

15. Our Bank sanctioned an overdraft facility for a sum of ` 27 million to M/s Sharada Constructions Company
(“Sharada”). Since Sharada defaulted in repayment and the account of Sharda became a NPA, our Bank issued

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 a demand notice dated October 29, 2011 under Section 13(2) of the SARFAESI Act, seeking repayment within
60 days from the date of notice, failing which our Bank would take recourse to remedies under Section 13(4) of
the SARFAESI Act. Thereafter, our Bank filed a miscellaneous application number 345/ 2013 in September,
2013 before the Chief Metropolitan Magistrate, Mumbai, and a securitisation application before the District
Magistrate of Thane for: a) the handing over of the physical possession of security properties through the
registrar of the court, b) direction to the police authorities to provide adequate security to the registrar.

In addition, our Bank filed an original application dated May 6, 2013 under the RDDBFI Act before DRT-III,
Mumbai against Sharada, Mr. Shashikant Rahate, Mr. Sanjay Rahate, and guarantors to the facility, seeking: a)
recovery of ` 26.70 million as on May 6, 2013, further interest at 20.75% p.a. penal interest at 2% p,a, with
monthly rests from the date of filing of the application till realisation, and all costs, charges, expenses required
to be incurred by our Bank for the preservation of the hypothecated or mortgaged property, b) direction to
defendants to disclose all moveable and immoveable properties belonging to them and furnish security for the
amount of claim under the application, c) in the event of failure to furnish security, order for attachment before
judgment of the said properties, d) sale and in the event of insufficiency of the sale proceeds, a personal decree
against the defendants. Further, our Bank also prayed for the following interim reliefs: a) appointment of a
receiver in relation to the hypothecated or mortgaged properties, and the other properties disclosed by the
defendants, with the power to sell and hand over the proceeds to us, b) injunction restraining the defendants and
their agents from dealing with, transferring, disposing of, or parting with the possession of the said properties,
c) attachment of properties owned by Mr. Rahate and certain guarantors, d) direction to the defendants to
disclose all their moveable and immoveable assets and to furnish a security, e) in the event of failure to furnish
security, attachment before judgment of the properties belonging to the defendants, sale and to hand over the
proceeds to us, f) pending disposal of this application, the defendants be restrained from leaving India without
the permission of the DRT. The matters are currently pending.

16. Our Bank sanctioned a cash credit limit of ` 10 million and a term loan of ` 3.41 million to M/s Dakshin Agro
Tech Private Limited (“Dakshin”). Since Dakshin defaulted in repayment, our Bank issued a demand notice
dated June 30, 2011 under Section 13(2) of the SARFAESI Act, seeking repayment within 60 days of the date
of notice, failing which our Bank would take recourse to remedies under Section 13(4) of the SARFAESI Act.
Thereafter, Mr. Ajay Chandran, managing director of Dakshin, filed a securitisation application dated May 7,
2012 for an order quashing the proceedings pursuant to demand notice dated June 30, 2011 issued by our Bank
and also prayed for an interim order staying all proceedings of recovery under the SARFAESI Act in respect of
immoveable properties which form the subject matter of CMP 3492/2011, pending disposal of the securitization
application.

Furthermore, our Bank filed an original application dated February 16, 2012 under the RDDBFI Act before the
DRT, Ernakulam against Dakshin, Mr. K.C. Chandrasekhar, Mr. Ajay Chandran, Mr. Arun Chandran, Mr. Devi
Prasad R. (directors of Dakshin), Ms. P. Radhamma, in their capacity of guarantors. Our Bank prayed for: a)
recovery of ` 25.16 million with further interest at 17.25% p.a. and penal interest at 1% p.a. with monthly rests,
along with charges and costs, b) direct the recovery officer to recover the amount under the recovery certificate
by sale of hypothecated and mortgaged moveable and immoveable properties, c) direction that the assets of the
defendants shall be liable in the event of deficiency of the sale proceeds, d) direction to the defendants to pay
costs and charges to us. Pursuant to an interim application filed by our Bank, the DRT through an order dated
February 22, 2012 restrained the guarantors from alienating, transferring or in any way encumbering the
security property. The matter is currently pending.

17. Our Bank sanctioned 47 gold loans to Mr. George Fernandes in 2010. Since there was a default committed in
repayment of the loans, our Bank issued a demand notice dated June 30, 2011 under Section 13 (2) of the
SARFAESI Act, seeking repayment within 60 days from the date of notice, failing which our Bank would take
recourse to remedies under Section 13(4) of the SARFAESI Act.

Thereafter, our Bank filed an original application dated February 1, 2012 under the RDDBFI Act against Mr.
George Fernandes, Ms. S. Sujatha, the guarantor, and State Bank of Hyderabad (“SBH”). Our Bank prayed for:
a) direction to Mr. Fernandes to pay an amount of ` 22.22 million with interest at 14% p.a. with monthly rests
from the date of application till realisation and costs, b) sale of mortgaged properties in the event of a default in
payment and allow the proceeds to be applied towards the debt, interest and costs, c) payment to be made out of

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 the personal assets of Mr. Fernandes in the event of insufficiency of proceeds with interest at 14% with monthly
rests till realisation. Further, our Bank also prayed for a temporary injunction to be awarded restraining Mr.
Fernandes from transferring, alienating or encumbering the mortgaged property. The DRT through an order
dated December 22, 2014: a) allowing recovery of a sum of ` 22.22 million by our Bank with interest at 6% p.a.
from the date of institution of the application till realisation, and costs from Mr. Fernandes personally and
through sale of properties mortgaged, b) dismissing our application against SBH. The matter is currently
pending for recovery.

18. Our Bank sanctioned certain credit facilities including cash credit limit, machinery loan and packing credit limit
to M/s Guru Apparels (“GA”). Since GA defaulted in their repayment, our Bank issued a demand notice dated
January 22, 2013 under Section 13(2) of SARFAESI Act, seeking repayment within 60 days of the date of
notice, failing which our Bank would take recourse to remedies under Section 13(2) of the SARFAESI Act.
Subsequently, our Bank took possession and sold the secured property.

Further, our Bank filed an original application dated October 17, 2014 under the RDDBFI Act before the DRT,
Coimbatore against GA and its partners for: a) recovery of ` 5.82 million with interest at 20.75% p.a. towards
cash credit facility, ` 14.56 million with interest at 21.75% p.a. towards packing credit limit, ` 0.50 million with
interest at 20.75% p.a. towards machinery loan, aggregating to ` 20.88 million with subsequent interest accrued
from October 20, 2014 till realization, b) sale of mortgaged properties and appropriation of proceeds towards
the amount due in the event of failure to pay, c) in the event of insufficiency of sale proceeds, direction to the
defendants to personally pay the balance, d) award of costs. Further, our Bank also prayed for the following
interim reliefs: a) direction to the defendants to pay rent and receivables from the properties hypothecated or
mortgaged to us, b) interim injunction restraining defendants from alienating or encumbering personal
properties, c) allow our Bank to take possession of properties hypothecated with our Bank and to sell the same
through a public auction or private sale and realize the sale proceeds towards the claim amount. The matters are
currently pending.

19. Our Bank, as part of a consortium arrangement led by Indian Bank, extended overdraft and letter of credit
facilities to M/s Hifazat Chemical Limited (“Hifazat”). Since Hifazat defaulted in repayment, our Bank filed an
original application dated April 10, 2000 under the RDDBFI Act before DRT-II, New Delhi against Hifazat,
other consortium members, and financial institutions as creditors of Hifazat. Our Bank prayed inter-alia for: a)
direction to Hifazat to pay ` 18.64 million due as on April 10, 2000 along with future interest at 21.42% p.a.
compounded with quarterly rests from the said date till realisation, and direction to Hifazat to pay the above
aggregate sum, b) sale of hypothecated securities and current assets of Hifazat towards adjustment of claim
amount, c) sale of entire fixed assets of Hifazat. Further, our Bank also prayed for interim reliefs: a) to restrain
Hifazat from selling, transferring and parting with certain immoveable property during the pendency of the
application, b) attachment and sale of hypothecated goods and current assets of Hifazat towards the satisfaction
of the dues, c) direction to certain defendant-financial institutions to not sell the fixed assets of Hifazat without
our consent.

Subsequently, Hifazat was ordered to be wound up pursuant to an order dated August 26, 2003 of the Calcutta
High Court and a liquidator was appointed. Indian Bank, the consortium leader also filed an original application
dated July 17, 2006 for the recovery of a sum of ` 83.18 million from the erstwhile directors of Hifazat, and to
allow proceeding against the security property forming part of the consortium facility security.

In relation to our application, the DRT passed an ex-parte order dated December 7, 2007: a) for issuance of
recovery certificate for ` 19.64 million with pendenlite and future interest at 15% p.a. compounded with
quarterly rests from the date of filing of this application till realization, b) granting an injunction restraining
HCL, through the official liquidator, from transferring or alienating or creating any third party rights in the
mortgaged or hypothecated property, c) in the event of failure to pay, holding that our Bank would be entitled to
sell all mortgaged and hypothecated property of Hifazat through the official liquidator. The matter is pending.

20. Our Bank sanctioned a cash credit limit of ` 6 million, term loan of ` 3.39 million, machinery loan of ` 1.15
million, term loan of `1.69 million, and mortgage loan of ` 1.51 million to M/s We one Tiles (“WOT”), a
partnership consisting of Mr. Anilkumar and Mr. S. Gururajalingam as partners, with Ms. Shyna Anilkumar and
Ms. Baby Rani as guarantors. Further, our Bank also sanctioned a housing loan of ` 0.60 million and car loan of

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 ` 0.5 million to Mr. Anilkumar with Ms. Shyna Anilkumar and Mr. S. Gururajalingam as guarantors
respectively. Due to defaults in repayment, our Bank issued a demand notice dated October 2, 2011 under
Section 13(2) of SARFAESI Act, seeking repayment within 60 days of the date of notice, failing which our
Bank would take recourse to remedies under Section 13(2) of the SARFAESI Act.

Furthermore, our Bank filed an original application under the RDDBFI Act against WOT, Mr. Anilkumar, Mr.
S. Gururajalingam,, Ms. Shyna Anilkumar and Ms. Baby Rani. Our Bank has prayed for: a) recovery of ` 17.46
million and pendentlite and future interest at 16.25% p.a. with monthly rests on ` 17.02 million and penal
interest at the rate of 1% p.a. on ` 17.02 million from the date of application till realisation, and costs of this
application, in relation to term loan, machinery loan and cash credit limit b) recovery of ` 0.84 million from Mr.
Anilkumar and Ms. Shyna Anilkumar and pendenlite and future interest at 16.25% p.a. with monthly rests on `
0.82 million and penal interest at the rate of 1% p.a. on ` 0.82 million from the date of application till
realization, and costs of this application, in relation to housing loan c) recovery of ` 0.65 million from Mr.
Anilkumar and Mr. Gururajalingam and pendenlite and future interest at 16.25% p.a. with monthly rests on `
0.63 million and penal interest at 1% p.a. on ` 0.63 million from the date of application till realization and costs
of this application, d) sale of hypothecated / mortgaged property after recording our charge over them for
recovering the ` 17.46 million plus interest and costs and allowing the application of proceeds towards the debt
due, e) sale of immoveable property owned by Mr. Anilkumar application of proceeds towards debt due, f)
recovery of ` 0.65 million from Mr. Anilkumar and Mr. Gururajalingam with interest and costs and sale of the
hypothecated car, g) direction for the payment of expenses incurred or to be incurred during the debt recovery,
h) allowing our Bank to participate in the auction proceedings to be conducted by the recovery officer without
the payment of earnest money deposit, i) order that our Bank shall have priority over the sale proceeds of the
mortgaged property, k) contingent liabilities like insurance premia, costs and expenses that may be incurred by
us after the filing of the application. The matter is currently pending.

21. Our Bank sanctioned cash credit/ letter of credit facility for ` 15 million to Corium Trading Limited
(“Corium”) on October 12, 2009, which was later enhanced to ` 30 million on February 25, 2013. Two
guarantors, namely Mr. Anthony John and Ms. Sakila Balaguru, later revoked their guarantee to the said facility
through a letter received by our Bank on April 12, 2013. Corium defaulted in the repayment of the said
facilities. Therefore, our Bank filed an original application dated December 22, 2014 under the RDDBFI Act
before the DRT-II, Chennai against Corium, Mr. John and Ms. Balaguru, seeking inter-alia for: a) recovery of
` 18.36 million with interest at 20.75% p.a. with monthly rests from the date of application till realization and
costs, b) in the event of failure to pay, sale of the mortgaged properties and the application of the sale proceeds
towards the realization, c) in the event of insufficiency of proceeds, direction for the payment of the deficit out
of the defendants’ personal assets with interest at 20.75% p.a. with monthly rests and 2% p.a. towards penal
interest till realization. Further, our Bank prayed for an interim injunction restraining the defendants from
transferring, alienating, encumbering or transferring the hypothecated or mortgaged properties during the
pendency of the application. The matter is currently pending.

22. Our Bank had sactioned 35 gold loans to Ms. Vennila George Fernandes on November 23 and 24 of 2010.
Since she defaulted in their repayment, our Bank issued a demand notice dated August 30, 2011 under Section
13(2) of SARFAESI Act, seeking repayment within 60 days of notice, failing which our Bank would take
recourse to remedies under Section 13(4) of the SARFAESI Act.

In addition, our Bank filed an original application dated February 1, 2012 under the RDDBFI Act before the
DRT-II, Chennai against Ms. Vennila George Fernandes and Repco Home Finance Limited (“Repco”), for: a)
direction to Ms. Fernandes to pay an amount of ` 18.23 million with interest at 14% p.a. with monthly rests
from the date of application till realisation and costs, b) in the event of default of payment of the claim, sale of
mortgaged properties and application of proceeds towards payment of the aforesaid amount, c) in the event of
insufficiency of the said proceeds, direction to Ms. Fernandes to pay the deficit with interest at 14% p.a. with
monthly rests till realization from her personal assets. Further, our Bank also prayed for a temporary injunction
restraining Ms. Fernandes from transferring, alienating, encumbering or transferring possession of the
mortgaged properties till the disposal of this application. The DRT through an order dated December 22, 2014:
a) allowed our Bank to recover ` 18.23 million with interest at 6% p.a. from the date of filing of application till
realization, and costs from Ms. Fernandes and through sale of mortgaged properties, b) held that our Bank is

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 entitled to the house and premises forming part of security property subject to the first charge held by Repco on
the same. The matter is currently pending and we are yet to receive a recovery certificate.

23. Our Bank had provided a bank guarantee of ` 10.80 million and a packing credit loan of ` 2.50 million in April
2000 to late Mr. K.R. Srinivasan, proprietor of M/s Photomax Sales and Service (“Photomax”). Due to default
committed in repayment, our Bank filed an original application dated October 8, 2001 under the RDDBFI Act
before DRT, Bangalore against Mr. K.R. Srinivasan, and others including the guarantors, seeking inter-alia: a)
order for payment of ` 16.7 million with interest at 20% p.a. from October 8, 2001 till realisation with quarterly
rests along with an order for costs and, b) issue a recovery certificate for the said sum of ` 16.7 million in
favour of our Bank with costs and interest at the rate of 20% p.a. with quarterly rests from October 8, 2001, c)
pass an order for sale of moveable and immoveable properties. The DRT, Bangalore passed an order dated May
15, 2009: a) directing the legal representatives of Mr. Srinivasan to jointly and severally pay a sum of ` 16.69
million along with costs and interest at 20% p.a. with quarterly rests from the date of the application till
realisation, b) holding that our Bank could recover the said amount from them as well as from the properties
mortgaged with us, c) in case of non-recovery allowing our Bank to recover the aforesaid sum from the
concerned officers who were responsible for lending to Mr. Srinivasan, d) dismissing the application against the
other defendants. Against the said order of the DRT, our Bank filed an appeal dated September 19, 2009 before
the DRAT, Chennai inter-alia for: a) dismissal of the application against certain defendants (defendant numbers
5-11 under the application) to be set aside, b) direction for recovery of the balance from the concerned officers
of our Bank who were responsible for lending to Mr. Srinivasan,. The DRAT passed an order dated March 4,
2013: a) confirming the dismissal of the application against Ms. R.L. Saroja and releasing one of the security
properties said to have been mortgaged to us, b) setting aside the dismissal of the application against defendant
numbers certain defendants who are guarantors to the original application, c) setting aside the order in so far as
it directed recovery against concerned officers of our Bank. The matter is currently pending.

24. Our Bank sanctioned an overdraft facility of ` 6.70 million to M/s Ayodhya Machine Chains (“AMC”). Since
AMC defaulted in its repayment, its loan account was classified as a NPA. Our Bank issued a demand notice
dated November 15, 2011 under Section 13(2) of the SARFAESI Act, failing which our Bank would take
recourse to remedies under Section 13(4) of the SARFAESI Act. Thereafter, our Bank filed an original
application dated March 10, 2014 before DRT, Ernakulam against AMC and Mr. Deepak Patel, Mr. Bhaskar
Pawar (in their capacity as partners of AMC), Mr. Pandit Pawar in his capacity as guarantor, and another. Our
Bank has prayed for: a) recovery of ` 11.72 million with interest at 20.75% p.a. with monthly rest accruing
from March 10, 2014 till realization from the defendants jointly and severally and by the sale of moveable and
immoveable assets, b) confirmation that the immoveable properties mortgaged to our Bank are charged for the
aforesaid amount along with interest and costs, c) sale of the mortgaged immoveable properties and realisation
through the appointment of a receiver, d) award of costs, insurance charges and charges payable towards
receiver and commissioner The matter is currently pending.

25. Our Bank sanctioned letter of credit facilities of ` 6 million and ` 4 million to Mr. Chandavan Pillai and Mr,
Kaluveetil Johnny who also stood as a guarantor for Mr. Pillai’s facility. Due to default committed in
repayment under both facilities, our Bank filed an original application dated August 22, 2005 before the DRT,
Pune against Mr. Chandavan Pillai and Mr. Kaluveettil Johnny. Our Bank prayed for: a) recovery of ` 11.50
million by issuing a recovery certificate, b) payment of interest and costs from the date of the application till
realisation, d) interim injunction restraining the defendants from alienating or creating third party interest in the
moveable and immoveable properties hypothecated and mortgaged in favour of our Bank, e) appointment of a
receiver to receive amounts receivable, control inventory, purchase raw materials and sell finish products, f) that
certain moveable and immoveable properties be attached and sold through the recovery officer, g) direction to
the defendants to pay insurance premia for the hypothecated properties during the pendency of the application.
The DRT passed a final order dated August 29, 2005: a) directing the issue of a recovery certificate in our
favour for the recovery of ` 11.50 million together with future interest at 15% p.a. from the date of the
application till the realisation and cost of the application from the defendants, b) holding that our Bank had
charge on the hypothecated or mortgaged property for the said amount and that our Bank could sell the
mortgaged property after two months from the date of the order. The matter is currently pending for recovery.

26. Our Bank sanctioned a term loan of ` 1.88 million and an overdraft limit of ` 5.75 million to Mr. Jojo Thomas
(proprietor of Manjima Wedding Centre) with Ms. Lissieu Jojo acting as a guarantor. Due to the irregularities

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 and defaults committed in repayment by Mr. Thomas, Our Bank issued a demand notice dated December 16,
2009 under Section 13(2) of the SARFAESI Act, failing which our Bank would take recourse to remedies under
Section 13(4) of the SARFAESI Act. Subsequent to this, our Bank took possession of the secured asset and sold
the same. Our Bank filed an original application dated January 21, 2010 under the RDDBFFI Act before the
DRT, Ernakulam against Mr. Jojo Thomas and Ms. Lissieu Jojo for: a) recovery of ` 0.91 million with
pendenlite and future interest at 17.75% p.a. with monthly rests on ` 0.90 million and penal interest at 1% p.a.
on ` 0.90 million from the date of application till realization and costs, in respect of the term loan, b) recovery
of ` 10.45 million with pendenlite and future interest at 18.25% p.a. with monthly rests on ` 10.37 million and
penal interest at 1% p.a. on ` 10.37 million from the date of application till realization and costs, in respect of
the overdraft facility availed by Mr. Johnson, c) sale of immoveable property and for allowing us to apply the
proceeds towards the claim amount, d) order that our Bank shall have priority over the sale proceeds, e)
direction to the defendants to pay the contingent liabilities like insurance premium, costs and other expenses
that may be incurred after the filing of the application f) award of costs of the application. The DRT, Ernakulam
passed a final order dated December 20, 2010 allowing us to recover ` 11.36 million with further interest of
12% p.a. on the sum of ` 11.27 million from January 21, 2010 till realization, and costs from the defendants
jointly and severally and by the sale of certain immoveable property of Mr. Thomas charged to the Bank. The
matter is currently pending for recovery.

27. Our Bank sanctioned an overdraft facility of ` 9 million to M/s. Bismi Plastic House (“Bismi”), a proprietary
concern of late Ms. K.M. Subaida. Since Bismi defaulted in the repayment of the amount due under the facility,
our Bank issued a demand notice dated April 27, 2011 under Section 13(2) of the SARFAESI Act. Our Bank
filed an original application dated November 7, 2011 under the RDDBFI Act before the DRT, Ernakulam
against Bismi, and others, for the recovery of a sum of ` 11.09 million under an overdraft loan account with
further interest at 16% p.a. with monthly rests and penal interest of 1% p.a. from the defendants jointly and
severally. The DRT passed a final order dated September 24, 2012 allowing recovery of ` 11.09 million with
further interest of 14% p.a. on ` 11.09 million from November 8, 2011 till realization and proportionate costs
(less the sums already recovered by our Bank under SARFAESI Act) from the guarantors jointly and severally,
and from the assets of the legal heirs of Ms. Subaida, who shall be personally liable to the extent of the value of
the assets. The matter is currently pending for recovery.

28. Our Bank sanctioned overdraft facilities of ` 5 million to Supreme Chemi-Plast Piping Private Limited
(“Supreme”) and ` 3 million to Mr. Simon Joseph. Since Supreme and Simon defaulted in repayment, our
Bank filed an original application on July 19, 2000 under the RDDBFI Act before the DRT, Chennai against
Supreme and Mr. Simon Joseph, Mr. Simlee Simon, Ms. Prabha Manuel, Ms. Leela Simon as guarantors. The
matter was subsequently transferred to DRT-II, Chennai and order dated December 7, 2011 was passed for: a)
the issue of a recovery certificate for a sum of ` 10.92 million (restricted to a sum of ` 6.48 million in relation
to Supreme) with interest at 23% p.a. compounded with quarterly rests from the date of filing of the application
till the date of the realisation, costs and the sale of the immoveable properties charged to our Bank, b) ` 1
million paid by defendants as part payment towards one-time settlement to be appropriated towards the
outstanding balance. Thereafter, Punjab and Sind Bank (“PSB”) filed an interim application before the recovery
officer claiming mortgage rights over certain security property and praying for their release from attachment.
The said application was dismissed by the recovery officer on September 21, 2012. Aggrieved by the same,
PSB filed an appeal before the DRT-II, Chennai, which was dismissed through an order dated September 4,
2013. The matter is currently pending for recovery.

29. Our Bank sanctioned an overdraft on mortgage facility of ` 8 million to Mr. N.R. Johnson, proprietor of M/s
Janatha Traders on March 22, 2012. Since Mr. Johnson defaulted in its repayment and his account became a
NPA, our Bank issued a demand notice dated October 15, 2013 under Section 13(2) of SARFAESI Act, seeking
repayment within 60 days of the notice, failing which our Bank would take recourse to remedies under Section
13(4) of the SARFAESI Act. Thereafter, M/s Janatha Traders, through its proprietor, filed a securitisation
application dated January 12, 2014 against the securitisation proceedings initiated by our Bank.

Further, our Bank has filed an original application dated July 15, 2014 under the RRDBFI Act before the DRT,
Ernakulam against Mr. N.R. Johnson and Ms. Limna Johnson as guarantor for the said facility Our Bank has
prayed for: a) recovery of ` 10.32 million, pendenlite and future interest at 19.25% p.a. with monthly rests on `
10.30 million, penal interest of 1% p.a. on ` 10.30 million from the date of the application till the date of

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 realization, b) sale of immoveable properties mortgaged under the facility and to allow us to apply the sale
proceeds towards the realisation of the amount of ` 10.32 million, c) direction to the defendants to pay the
expenses of recovery and sale of properties, d) order allowing our Bank to participate in the auction
proceedings to be conducted by the recovery officer without the payment of earnest money deposit, e) priority
over the sale proceeds of the property to be realized by the recovery officer, f) that the defendants shall be
personally liable for the amount due, g) direction to the defendants to pay contingent liabilities like insurance
premium, costs and other expenses that may be incurred by us subsequent to the filing of this application. Our
Bank has also prayed for a temporary injunction restraining the defendants from transferring or alienating or
otherwise disposing of the immoveable property mortgaged under the loan. The matters are currently pending.

30. Our Bank sanctioned a machinery loan of ` 11.64 million and a bank guarantee limit of ` 46.30 million to M/s
RPR Fab (“Fab”), a partnership firm,. Since Fab defaulted in repayment of the said facilities, our Bank issued a
demand notice dated April 11, 2012 under Section 13(2) of SARFAESI Act, seeking repayment within 60 days
from the date of notice, failing which our Bank would take recourse to remedies under Section 13(4) of the
SARFAESI Act. Fab, its partners, and another filed a securitisation application dated December 17, 2013 for: a)
an order setting aside the auction sale that was scheduled to be held on December 30, 2013 and consequently,
the sale notice, b) award of costs of the proceedings. Fab also filed an interim application seeking a temporary
injunction restraining our Bank from proceeding under SARFAESI Act.

Further, our Bank filed an original application dated November 15, 2012 under the RDDBFI Act before the
DRT, Coimbatore against Fab and others for: a) recovery of ` 10.26 million along with future interest of
20.75% with monthly rests from the date of the application till the date of realisation, b) award of costs of the
application, c) sale of the hypothecated and mortgaged properties, d) proceeding against the other assets of the
defendants in case of insufficiency of the sale proceeds. The matter is currently pending.

31. Our Bank sanctioned a cash credit facility of ` 97 million and a term loan of ` 4.5 million to Milan Steel Homes
Private Limited (“Milan”). On May 24, 2013 our Bank granted an adhoc cash credit limit of ` 14.50 million to
Milan. Since Milan defaulted in repayment of the said facilities, the account of Milan was classified as a NPA.
Our Bank issued a demand notice dated March 30, 2014 under Section 13(2) of the SARFAESI Act to Milan,
Mr. Devendra Shah, and Ms. Shilpa Shah, in their capacity as guarantors, seeking repayment within 60 days of
the date of notice, failing which our Bank would take recourse to remedies under Section 13(4) of the
SARFAESI Act. We understand that a securitization application has been filed by Milan before the DRT-III,
Mumbai. However, we have not received any official intimation in this regard.

Further, our Bank filed an original application dated December 26, 2014 under the RDDBFI Act before the
DRT-III, Mumbai against Milan, Mr. Devendra Shah, and Ms. Shilpa Shah. Our Bank prayed for: a) recovery
of a sum of ` 133.40 million with interest at 21% p.a. compounded at monthly basis from the date of filing of
the application till realization, b) declaration that immoveable properties, fully paid stock, and outstanding
book-debts were validly mortgaged or hypothecated to our Bank, c) the said moveable and immoveable
properties be sold and the proceeds be adjusted towards the claim amount, d) personal assets of Mr. Devendra
Shah be attached and sold to realize the claim amount. Further, our Bank filed an interim application for: a)
pending disposal of the application, an injunction restraining the defendants and their men from in any way
transferring, alienating or creating third party rights in the immoveable properties mortgaged to us, immoveable
properties forming personal properties of Mr. Shah, fully paid stock and outstanding book-debts of Milan, b)
direction to the individual defendants to disclose their assets on oath, c) pending disposal of the application, that
Mr. Shah and Ms. Shah be restrained from disposing of or creating third party rights in their assets. The matters
are currently pending.

Recovery proceedings for loans advanced under priority sector lending schemes

In addition to the recovery proceedings as described hereinabove, we also organize recovery camps with the
assistance of government bodies to increase the recovery of loans made under government sponsored schemes and
other loans in priority sector to reduce our NPAs. As on March 24, 2015, there are 3,026 such recovery proceedings,
and the aggregate amount involved, to the extent quantifiable, in such proceedings is ` 75.75 million.

Civil proceedings

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In addition to the recovery proceedings as described hereinabove, our Bank has also initiated certain civil suits in
relation to eviction of tenants from our Bank’s owned premises, recovery of security deposit due from lessors of our
erstwhile branch premises and declaration of title over mortgaged property in the favour of our Bank. As on March
24, 2015, there are eight civil suits pending before various courts in India, and the aggregate amount claimed, to the
extent quantifiable, is approximately ` 5.53 million. Details of the civil suits filed by us, where the potential
financial implication is over ` 10 million, or where the financial impact cannot be quantified, are as follows:

1. Our Bank filed an original suit (O.S. No. 87/2013) dated May 20, 2013, before the Subordinate Judge’s Court
Nedumangad against Ms. Sulochana and Mr. Deepak Patel. Mr. Deepak Patel availed two credit facilities
aggregating to ` 7.22 million from Kozhikode branch of our Bank secured against equitable mortgage of
property created in favour of our Bank. The loan accounts were not conducted properly and were subsequently
classified as non–performing assets. Ms. Sulochna, being the legal heir of the earlier owner of the properties in
question, in a separate original suit (O.S. No. 597/2010) filed by her before the Munsif Court, Nedumangad
against Mr. Deepak Patel, obtained an ex-parte decree dated August 21, 2011, wherein the court conferred her
title and ownership over the property mortgaged to our Bank. Our Bank filed an original petition (O.P. (C) No.
1544/2013) before the High Court of Kerala for quashing and setting aside the judgment and decree passed in
O.S. No. 597/2010. The High Court of Kerala by its judgment dated April 12, 2013 directed our Bank to
approach the civil court, consequent to which our Bank filed the present suit for setting aside the order. The
matter is currently pending.

2. Our Bank filed four rent control appeals (R.C.A. Nos. 148, 149 151 and 152 of 2011) dated July 11, 2014
before the Rent Control Appellate Authority, Trichur against Ms. Sasi Anto and others, Mr. Iyappan P.J., Mr.
Roy Emmatty and Mr. N.R. Janaky and others respectively. The aforementioned appeals were filed against the
common judgment dated April 11, 2014 passed by the Rent Control Court, Thrissur in rent control petitions
(R.C.P. 34, 35, 36 and 37 of 2009) filed by our Bank, wherein the Rent Controller, while passing the judgment
under Kerala Buildings (Lease and Rent Control) Act, 1965 allowed the reconstruction of premises owned by
our Bank, however the Rent Controller disallowed the relief sought for eviction of tenants from our Bank’s
premises situated at Swaraj Road, Thrissur, on grounds of bona fide need. These appeals are currently pending.

One of the respondents of the appeal (R.C.A. 149/2011) has also filed an appeal (R.C.A. 143/2011) dated July
8, 2011, before the Rent Control Appellate Authority, Trichur, seeking to set aside the order in R.C.P. 35/2009
of the Rent Controller allowing for reconstruction of premises. The appeal is currently pending.

Cases under Section 138, Negotiable Instruments Act

Our Bank has filed various complaints for recovering amounts due from various entities on account of dishonouring
of cheques issued by such entities. As on March 24, 2015, there are 9 such complaints pending before various
courts. The total amount involved in such cases is approximately ` 20.48 million. There is one such complaint which
involves an amount equal to or above ` 10 million, filed against Jupiter Bioscience Limited for an amount of ` 10.83
million.

B. Material frauds committed against our Bank

Our Bank has an anti-fraud committee, namely the Committee for Monitoring Large Value Frauds, which monitors
and reviews all frauds against our Bank involving an amount of ` 10 million or more, in accordance with RBI
master circular on classification and reporting of frauds dated July 1, 2014. For details, please refer to section titled
“Regulations and Policies - Classification and Reporting of Fraud Cases” on page 163.

For details of the material frauds committed against our Bank, see the section titled “ – Cases filed by our Bank –
Criminal proceedings” on page 276.

C. Proceedings initiated against our Bank for economic offences

Except as stated below, there are and have been no proceedings initiated against our Bank for any economic
or civil offences:

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 1. Senior Inspector of Police, Economic Offences Wing, CB-CID, Mumbai issued a notice dated March 7,
2015 to our Bank’s Mumbai branch, stating that two accounts maintained by Ms. Padmavati Pathapedi
and Mr. Hirachand Jain with the Bhayandar branch of our Bank had been used to siphon funds emanating
out of fraudulent transactions of an amount of ` 55.97 million, as alleged in a complaint filed by the
General Manager of Satara Sahakari Bank Limited, Mumbai. The noticee directed our Bank to freeze the
account of M/s. Padmavati Sahakari Pathapedi Limited (“PSPL”) and its office bearers, Mr. Hirachand
Hasmukh Shah, Ms. Pushpa Hirachand Saha and Mr. Ankush Hirachand Shah. Our Bank has been
additionally directed to freeze the fixed deposit held in the name of office bearers of PSPL. Further, the
noticee has instructed our Bank to furnish documents such as account statements, KYC records, certified
copies of fixed deposits held in the name of PSPL and its said office bearers, maintained with the
Bhayandar branch of our Bank.

D. Past penalties imposed on our Bank

1. A penal interest of ` 0.36 million was imposed by RBI on our Bank in AY 1988-89 for failure to
maintain the statutory liquidity ratio, as prescribed under the Banking Regulation Act.
2. A penal interest of ` 0.18 million was imposed by RBI on our Bank in AY 1989-90 for failure to
maintain the statutory liquidity ratio, as prescribed under the Banking Regulation Act.
3. A penal interest of ` 0.53 million was imposed by RBI on our Bank in AY 1990-91 for failure to
maintain the statutory liquidity ratio, as prescribed under the Banking Regulation Act.
4. In July 2007, RBI imposed a penalty of ` 1 million on our Bank, being a penalty of ` 0.5 million for non-
adherence to KYC norms and AML standards while opening and operating certain accounts, and of ` 0.5
million for failure of the internal control systems in detecting irregularities.
5. RBI issued a show cause notice dated July 9, 2002 to our Bank in relation to failure of our Bank to
comply with the instructions and guidelines prescribed under the Banking Regulation Act and RBI
circulars dated June 21, 1999 and September 20, 1995, for opening accounts and maintaining records of
cash deposits and withdrawals of amounts exceeding ` 1 million. Our Bank submitted a reply dated July
16, 2002. Pursuant to an order dated August 21, 2002, RBI imposed a penalty of ` 0.5 million on our
Bank for the afore-mentioned non-compliances.

E. Pending Notices against our Bank

As on March 24, 2015, there are 37 legal notices pending against us, and the aggregate amount claimed
against us, to the extent quantifiable, is approximately ` 21.70 million. Details of legal notices against us,
where the potential financial implication is over ` 10 million or where the potential financial implication is
not quantifiable are as follows:

1. Ms. Vijaykumari R, one of the recipients of family pension served a notice dated July 2, 2014 to our
Bank asserting that she is the sole successor/legal heir of late Mr. Unnikrishnan, a deceased employee of
our Bank and based on the succession certificate issued by the Court of Principal Munsiff,
Thiruvanathapuram, claimed her sole entitlement to receive entire pension related benefits. She also
sought our Bank to close a housing loan account, which was outstanding in the name of her deceased
husband.

2. The Registrar (Subordinate Judiciary) of the High Court of Kerala served a notice dated June 18, 2014
against our Bank, seeking a report regarding an anonymous petition received in the registry of the High
Court, wherein allegations of retention of original certificates of employees of our Bank after joining in
service had been made. Our Bank submitted a report dated August 30, 2014 to the Registrar (Subordinate
Judiciary) of the High Court of Kerala, denying such allegations.

3. The RBI on July 9, 2014 forwarded a complaint from Ministry of Finance Government of India, which in
turn forwarded a complaint from National Human Rights Commission, which had also received an email,
originally sent to our Managing Director on February 2, 2014 by Ms. Aradhna Jha, who claimed to be an
employee of our Bank and alleged retention of her original certificates of employees and the practice of
bonded labour in our Bank. The Chief Minister’s Public Grievance Redressal Cell, Thiruvanthapuram by

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 a letter dated August 4, 2014 had also forwarded the grievance of Ms. Aradhna Jha. Our Bank informed
RBI and the Chief Minister’s Public Grievance Redressal Cell by a letter dated September 1, 2014 that
upon an attempt to send an email response to Ms. Aradhna Jha, it was found that there is no employee in
our Bank with such name and allegations of practice of bonded labour in our Bank were denied. Our
Bank also stated in the reply that our Bank had not detained certificates of any employee so as to cause
any inconvenience or prejudice to them.

4. The ALC, Ernakulam issued three notices dated March 6, 2015 against our Bank seeking clarification
regarding implementation of awards in certain industrial disputes between our Bank and the CSB Staff
Association, being industrial dispute (I.D. No. 268/2006) concerning non-consideration of special
allowance for the purpose of fitment, industrial dispute (I.D. No. 17/2007) dated June 26, 2009,
concerning settlement in terms of full and final satisfaction of claims to tiny deposit collectors and
industrial dispute (I.D. No. 7 and 8/2006 dated July 18, 2006) concerning the payment of allowance to
computer operators.

5. The ALC, Ernakulam issued a notice dated March 9, 2015 against our Bank seeking clarification
regarding implementation of awards in an industrial dispute (I.D. No. 135/1999) dated November 6,
2000, between our Bank and the CSB Staff Association, concerning the transfer policy of our Bank.

6. Mr. Devesh Kumar, clerk cum cashier of the New Delhi branch of our Bank issued a notice dated July 23,
2014 to our Bank, stating that he was sent to Tihar jail and remained in judicial custody for a period of 13
months and after release despite his frequent requests was not permitted to rejoin the services of our
Bank. He has sought for his reinstatement and payment of back wages since November 2012.

7. M/s Instrument Techniques Private Limited represented by its director, Mr. S. Ravi has issued a legal
notice to our Bank dated October 18, 2014, stating that prudential norms were allegedly not followed
while categorizing an account of the company maintained with the Abid Road, Hyderabad branch of our
Bank, as a non-performing asset and has expressed dissatisfaction over assignment of the loan account to
Peagasus Assset Reconstruction Private Limited. Documents in relation to assignment of his loan account
to Peagasus Assset Reconstruction Private Limited have been sought for the purposes of issuing a fresh
detailed notice.

8. Mr. N. Bhageerathan, proprietor of M/s. Soney Cashew Company and the erstwhile lessor of the premises
of our Kollam branch issued a legal notice to our Bank, claiming arrears of rent since October 1986,
amounting to ` 9.40 million, and interest payable on the arrears from the date of accrual each month till
payment at the relevant bank rate as applicable from time to time. Further, Mr. N. Bhageerathan has
claimed additional damages of ` 2.00 million from our Bank for allegedly improper usage of the premise,
and the damage and destruction caused to it.

9. Mr. Sainudeen, a customer of our Bank, issued a legal notice dated December 3, 2014 expressing doubts
over closure of certain of his fixed deposit accounts maintained with the Thiruvananthapuram main
branch of our Bank. He had earlier also sought information regarding the same and stated that concerned
branch had allegedly not responded to his queries. He alleged that such acts are contrary to the provisions
of banking laws and that we had intentionally committed deficiency in services. He has called upon our
Bank to supply him requisite information regarding the closure of his fixed deposit account, failing which
he would initiate legal actions against our Bank.

10. Dr. V. Thomas Varghese and Ms. Susan Varghese, lessors of the Palarivattom, Cochin branch of our
Bank issued a notice dated March 19, 2015 stating that our lease would expire on August 14, 2015 and
wanted to bring to the knowledge of our Bank that the premises would have to be vacated upon expiry of
the period of lease on August 14, 2015.

11. Our Bank received a notice dated January 2, 2015 from the Court of Assistant Civil Judge - V, City Civil
Court, Chennai in relation to an original suit (O.S. No. 3671 of 2014) filed by Andhra Bank before the
court against Mr. N.G. Ravichandran and others, alleging diverting of loan amounts for purposes other
than for which a loan was availed. Andhra Bank filed an interlocutory application in the original suit,

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 seeking to implead our Bank as a defendant to the recovery suit, alleging that our Bank negligently
opened an account for an impersonated identity, which facilitated the fraud committed against their bank.
However, no order for impleading our Bank as a party has been passed till date.

12. Brahmapur Police Station issued a notice dated September 11, 2014 to the manager of the Gulbarga
branch of our Bank, calling for documents in relation to a complaint filed by State Bank of India
concerning the account of Mr. G. Rathod, who was also a customer of the Vapi branch of our Bank.

Our Bank also received a notice dated March 7, 2015 from the Senior Inspector of Police, Economic Offences
Wing, CB-CID, Mumbai. For details, see the section titled “- Proceedings initiated against our Bank for
economic offences” on page 324.

F. Material developments since the last balance sheet date

Except as disclosed in the section titled “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” beginning at page 191, in the opinion of our Board, there have not arisen, since the
date of the last financial information disclosed in this Draft Red Herring Prospectus, any circumstances that
materially or adversely affect or are likely to affect our profitability taken as a whole or the value of its assets
or its ability to pay its material liabilities within the next 12 months.

G. Outstanding dues to small scale undertaking(s) or any other creditors

Under the Micro Small and Medium Enterprises Development Act, 2006 which came into force from October
02, 2006, certain disclosures are required to be made relating to micro, small and medium enterprises. There
have been no reported cases of delays in payments to micro and small enterprises or of interest payment due
to delays in such payments.

H. Outstanding litigation against other companies whose outcome could have an adverse effect on our
Bank

Except as stated in this section, there is no outstanding litigation against other companies whose outcome
could have an adverse effect on our Bank.

I. Adverse findings against our Bank and any persons or entities connected with our Bank as regards non
compliance with securities laws

There have been no adverse findings against our Bank or any other persons or entities connected with our
Bank as regards non compliance with securities laws.

J. Disciplinary action taken by SEBI or stock exchanges against our Bank

There have been no disciplinary actions taken by SEBI or other stock exchanges against our Bank.

K. Litigations or defaults, etc. pertaining to matters likely to affect the operations and finances of our
Bank

Except as stated in this section, there are no litigation or defaults, etc. pertaining to matters likely to affect the
operations and finances of our Bank.

L. Inquiries, Inspections or Investigations initiated with respect to our Bank

There has been no inquiry, inspection or investigation initiated or conducted under the Companies Act or any
previous companies law in the case of our Bank in the last five years.

M. Other investigations

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 As part of an ongoing investigation against two income tax officials who were arrested in relation to certain
allegations of bribery, two officials from the Central Bureau of Investigation visited the Head Office of our
Bank at Thrissur on March 26, 2014, and informed certain officials of our Bank that during a raid conducted
on the concerned officials, certain gold items were found allegedly wrapped in gift paper of our Bank.
However, the investigating officials subsequently informed that it had been confirmed during the course of
investigation that the impugned gold items were not purchased by our Bank, and hence officials of our Bank
were not required to appear before the investigating officer. This matter was noted by our Board on April 8,
2014.

N. Prosecutions, fines or compounding of offences by our Bank

Except as disclosed in this section, there have been no prosecutions filed, fines imposed or offences
compounded in the case of our Bank in the last five years.

II. Litigation involving the Directors of our Bank

A. Outstanding litigations against our Directors

In addition to consumer proceedings of an amount over ` 10 million involving our Directors, to which our
Bank is a party as well, and details of which are given under the sections titled “ - Litigations involving our
Bank - Outstanding litigations involving our Bank - Consumer cases” on page 259, respectively, details of
litigations involving our Directors are as follows:

Mr. S. Santhanakrishnan

1. Ms. Geetha Ramachandran filed a criminal complaint (C.M.P. No. 611/2014) dated February 11, 2014
before the Chief Judicial Magistrate, Thrissur, against Mr. S. Santhanakrishnan, the part-time Chairman
of our Board, in relation to an alleged act of cheating committed. The complainant had worked as a chief
manager at the Purasawalkam branch of our Bank and had been dismissed for advancing of loans in
violation of our Bank’s lending norms during her tenure at the branch. Ms. Geetha Ramachandran had
earlier approached the Kerala Women's Commission in relation to the dismissal. The Kerala Women’s
Commission, pursuant to an order dated January 1, 2008, had directed our Bank to reinstate the
complainant with all benefits. However, in a writ petition (W.P. (C) No. 1498/2009) filed by our Bank
before the High Court of Kerala, the direction of the Kerala Women's Commission was quashed pursuant
to an order of the High Court dated May 24, 2010 on account of lack of jurisdiction. In the criminal
complaint, Ms. Geetha Ramachandran alleged that our part-time Chairman had instructed her to take
personal interest in recovering the said loans which had been advanced during her tenure, and assured to
reinstate her in service if the recovery of loans was assured through her efforts. Ms. Geetha
Ramachandran had earlier also instituted a criminal complaint (C.M.P. No. 8540/2013) before Chief
Judicial Magistrate, Thrissur and lodged an FIR (No. 2547/2013) dated October 15, 2013 at the Town
East police station, Thrissur, which had been declared as false post investigation, pursuant to which she
has filed the current criminal complaint. No accused summons has been served on Mr. Santhanakrishnan
in this matter till date and pre-cognizance evidence is ongoing in this matter.

2. Mr. K.N. Unnikrishnan, a customer of the College Road branch, filed a consumer complaint (C.C.
381/2011) against our Bank and our part-time Chairman, in relation to certain cheques presented by him
for clearance through ECS, which were returned on account of an alleged error in the ECS memorandum,
consequent to which the complainant had to pay a penalty of ` 1,650. The complainant has claimed
compensation of ` 0.05 million on account of mental agony and loss of repute. The matter is currently
pending.

3. Mr. Mathai, landlord of the premises of the Puthoor branch of our Bank, filed an original suit (O.S.
28/2015) before Munsiff Court, Kottarakara, seeking a decree to enhance the rent of the said premises
from ` 6,250 to ` 32,500 per month, and to realise arrears of rent amountinf to ` 32,500, on account of
increase in importance of the locality and hence the value of the property since the inception of tenancy
of our Bank at the premises.

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 4. Mr. K.M. Talera filed a writ petition (W.P. No. 3011/2007) before the High Court of Bombay, against
Institute of Chartered Accountants of India (“ICAI”), the Union of India, members of the 19 th Council of
ICAI (“19th Council”), including Mr. S. Santhanakrishnan and Mr. P.C. Parmar and Mr. J.P. Parmar,
chartered accountants, in relation to disciplinary proceedings No. 25-CA(15)/2005 initiated on an
allegation that Mr. P. C. Parmar and Mr. J.P. Parmar had entered into certain legal contracts for
conducting business other than the profession of chartered accountants, in violation of Sections 21 & 22
of the Chartered Accountants Act, 1949. Pursuant to a meeting of the 19 th Council held in February 2006,
they were found not guilty of the offences alleged and the decision of the 19 th Council was
communicated to the parties on April 12, 2006. The writ petition has been filed against the above
decision, wherein Mr. K.M. Talera has sought for quashing the decision and is currently pending.

Mr. Ajay Lal

1. A criminal case has been lodged before the Additional Chief Judicial Magistrate, Vadodara, Gujarat
against Mr. Ajay Lal, in his capacity as director of GPT Steel Industries Limited, with respect to a cheque
issued by the management of GPT Steel Industries Limited, which was returned. The complainant has
arrayed Mr. Ajay Lal as a co-accused, along with all other directors and several members, forming part of
the erstwhile management of the company. The case is currently pending.

2. Mr. Joy Ambooken, a shareholder of our Bank, had filed a petition before the Company Law Board,
Chennai, with respect to a rights issue of equity shares in 1998. The Company Law Board, Chennai
dismissed the petition against which Mr. Joy Ambooken filed an appeal before the High Court of Kerala,
Ernakulam. The case is currently pending. For further details of the matter, in which our Bank is also a
respondent, see the section titled “ - Litigations involving our Bank - Outstanding litigations involving
our Bank - Cases against our Bank – Civil proceedings” on page 253.

B. Outstanding litigation initiated by our Directors

There is no outstanding litigation initiated by our Directors.

C. Past penalties imposed on our Directors

There have been no past penalties imposed on our Directors.

D. Proceedings outstanding against our Directors for economic offences

There are no proceedings outstanding against our Directors for economic offences.

E. Tax proceedings outstanding against our Directors

There are no tax proceedings outstanding against our Directors.

F. Directors on the list of wilful defaulters of the RBI

Except for Mr. Ajay Lal, who was also a director on the board of GPT Steel Industries Limited which has
been declared as a wilful defaulter, none of our Directors or any entity with which our Directors are or have
been associated as director, promoter, partner and/or proprietor have been declared wilful defaulters by the
RBI.

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 GOVERNMENT AND OTHER APPROVALS

In view of the approvals listed below, our Bank can undertake this Issue and its current business activities and no
further material approvals from any Government authority are required to undertake the Issue or continue its current
business activities. Certain approvals have lapsed or may lapse in their normal course and the Bank has either
already made an application to the appropriate authorities for renewal of such licences and/or approvals or is in the
process of making such applications.

Approvals for the Issue

Corporate approvals

1. Our Board has, pursuant to its resolutions passed at a meeting held on December 22, 2014, approved the Issue.

2. Our shareholders have, pursuant to a resolution passed at an EGM held on February 19, 2015, approved the
Issue.

Regulatory approvals

The RBI has, through its letter DBR. PSBD. No. 11621/16.01.060/2014-15, dated February 4, 2015, granted its
approval for the Issue, subject to the compliance with applicable laws.

Material Approvals received and applied for, in relation to our business

Corporate and regulatory approvals

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
Companies Act
1. Certificate of Incorporation RoC 175 of 1920 April 14, 1987 -
under Section 610(1)(b) of
the Companies Act, 1956
Banking Regulation Act
1 License to carry on business Deputy Chief Tri/17 June 19, 1969 -
of banking under Section 22 Officer,
Department of
Banking
Operations and
Development,
RBI, Trivandrum
2. Permission for setting up one Assistant General DBOD.No.BL.8624/22.03. December 17, -
central processing centre for Manager, 033/2012-13 2012
back office functions at Department of
Kochi under Section 23 Banking
Operations and
Development,
RBI, Mumbai
3. Permission for setting up an Deputy Chief DBOD(T)No.BL.1112/2(31 March 22, 1982 -
international banking division Officer, )-82
at Ernakulam (Kochi) under Department of
Section 23 Banking
Operations and
Development,

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S. Approval/ License Issuing authority Reference No. Date of issuance Validity
No.
RBI, Trivandrum
4. Permission for setting up a Assistant Chief DBOD.No.BL.7057/NC.19 August 16,1982 -
staff training college at Officer, (C)-82
Alwaye under Section 23 Department of
Banking
Operations and
Development,
RBI, Mumbai

RBI Act
1. Inclusion in Schedule II to Deputy Chief DBOD(M)No.Bks.2662/Sc September 17, -
RBI Act as per Sub-clause Officer, h.11-69, and RBI 1969, with effect
(iii) of clause (a) of sub- Department of notification No. from August 30,
DBOD.No.90/Incl/C:102-
Section (6) of Section 42 Banking 1969
69 dated August 18, 1969
Operations and
Development,
RBI, Chennai
2. Grant of real term gross General Manager, DAD/CA/RTGS/203/2004- August 12, 2004 -
settlement system RBI, Mumbai 05
membership (Type A) under
Regulation 4.1 of RTGS
Systems Regulations, 2013
4. Membership of negotiated Regional Director, PDO/SGL/NDS- June 15, 2004 -
dealing system (No. Public Debt MEM/3988/2003-04
BYA00150) Office, RBI,
Mumbai
5. Membership of SWIFT - Bank identifier code: October 10, 2003 -
CSYBIN55
6. Approval to establish a Assistant Chief 4654/CC.3(CSB)-92/93 January 28, 1993
currency chest and small coin Officer,
depot at Ernakulam Department of
Currency
Management, RBI,
Mumbai
7. Approval to establish a ‘B’ Deputy General DCM(CC)/1104/03.06.14./ June 27, 2003 -
class currency chest and Manager, 2002-03
small coin depot at Department of
Coimbatore Currency
Management, RBI,
Mumbai
8. Authorisation to commence Deputy General DPSS.CO.AD/2201/02.23.0 March 24, 2011 -
and operate mobile banking Manager, RBI, 03/2010-11
services under Section 5(1) of Mumbai
the Payment and Settlement
Systems Act, 2007 and
Regulation 3(1) of the
Payment and Settlement
Systems Regulations, 2008
9. Admission for participation Assistant General DPSS(CO)No.238/04.03.02 August 23, 2006 -
in the RBI NEFT system Manager, /2006-07
Department of

331
S. Approval/ License Issuing authority Reference No. Date of issuance Validity
No.
Payment &
Settlement
Systems, RBI,
Mumbai

10. Grant of centralised fund General Manager, DAD/CFMS/716/24.16.01/ December 26, -

management system Deposit Accounts 2006-07 2006
membership Department, RBI,
(CFMS) Mumbai

11. Grant of INFINET Assistant General MUM ITC 713/02.90/2001- June 7, 2002 -
membership Manager, 2002
Information
Technology Cell,
RBI, Mumbai

FEMA
1. Authorisation to deal in Exchange Control EC.CHN.FMID.3/75 April 10, 2001 -
foreign exchange under Department, RBI,
Section 10(1) Kochi
2. Permission for continuing Assistant General F.E.CHN.FMID/779 October 8, 2013 October 7, 2016
cross-border inward money Manager, RBI
transfer services under the
Money Transfer Service
Scheme in association with
M/s. MoneyGram Payment
Systems, Inc. USA

We have pursuant to a letter dated February 14, 2015 applied for renewal of permission for carrying on cross-border
inward money transfer services under the Money Transfer Service Scheme in association with Royal Exchange
(USA) Inc. to the RBI.

Securities and Exchange Board of India (Merchant Bankers) Regulations

1. Registration as a merchant SEBI MB/INM000002863 March 15, 2012 -
banker (Category I) under
Regulation 8A

Pursuant to a circular issued by the RBI on July 20, 2005, no prior approval of the RBI is required for offering
internet banking services.

Our importer exporter code number 04080 02972, was granted pursuant to a certificate from the Foreign Trade
Development Officer, Ministry of Commerce, on April 17, 2008.

Other memberships and registrations

S. Membership Issuing authority Reference No. Date of issuance Validity

No.
1. License to act as a corporate Chairperson, EDT 1243508 February 22, 2013, June 15, 2015
agent for procuring or Insurance and with effect from June
soliciting insurance business Regulatory 16, 2012
for both life and general Development

332
 insurers under Regulation 3 Authority
of IRDA (Licensing of
Corporate Agents)
Regulations 2002
3. Membership of Fixed FIMMDA FIMGN/2005-06/699 December 2, 2005 -
Income Money Market and
Derivatives Association of
India (“FIMMDA”)
4. Registration with Clearing Credit Corporation CCIL membership ID: June 21, 2002 -
Corporation of India of India Limited CCBPCSBL0132
Limited and Clearcorp
Dealing Systems (India)
Limited
5. Membership of Banking CEO, BCSBI - October 1, 2010 -
Code and Standards Board
of India (“BCSBI”)
6. License to act as a corporate Chairperson, EDT 1243508 February 22, 2013 June 15, 2015
agent under the Insurance IRDA
Act, 1938

Our registration for distributing third-party mutual fund products pursuant to SEBI circular No.
MFD/CIR/20/23230/2002 dated November 28, 2002, issued by the Association of Mutual Funds of India (Reference
No. ARN – 18031) on March 24, 2009, expired on March 23, 2014 and we are yet to apply for renewal of this
registration.

Taxation approvals

S. Registration Issuing authority Reference No. Date of issuance Validity

No.
1. Permanent Account Number Commissioner of AABCT0024D - -
Income Tax,
Cochin
2. Tax Deduction and Department of
Collection Account Number Income Tax,
Ministry of
Finance,
Government of
India
3. Service tax registration at Superintendent of 146/ST/TCR- October 18, 2004 -
Thrissur under Section 69 of Central Excise, V/2004/BFS
the Finance Act, 1994 Department of
Revenue, Ministry
of Finance,
Government of
India
4. Service tax registration Central Excise AABCT0024DST009 April 7, 2008 -
under Section 69 of the Officer, Office of
Finance Act, 1994 for the Assistant
banking and financial Commissioner of
services, credit card related Central Excise and
services and renting of Customs, Thrissur
immovable property Division
5. Service tax centralised Joint C.No.IV.16/14/2002- December 29, 2004

333
 registration under Service Commissioner, ST/PN/116
Tax Rules, 1994 Office of the
Commissioner of
Central Excise &
Customs, Calicut
Commissionerate
7. Registration under the Assistant TIN: 29561192901 May 6, 2014, with -
Karnataka Value Added Tax Commissioner of effect from March 6,
Act, 2003 Commercial 2014
Taxes, Bangalore,

Further, we have made application for renewal of our registration under the Kerala Value Added Tax Rules, 2005 on
April 9, 2014.

Branch licenses

Pursuant to RBI Circular No. DBOD.No.BAPD.BC.54/22.01.001/2013-14 dated September 19, 2013, domestic
scheduled commercial banks (other than RRBs) are permitted to open branches in Tier 2 to Tier 6 centres and in the
rural semi-urban and urban centres in northern states and Sikkim, without any permission from RBI in each case,
subject to certain conditions. The general permission has been extended to branches in Tier 1 centres as well, subject
to fulfilment of criteria laid down under the circular.

Details of the key licenses obtained by our top 25 branches, identified on the basis of total business (advances and
deposits) as on September 30, 2014, are as given below:

1. Kodambakkam

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.T.112/80 May 21, 1980 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
-3
2. Tax Deduction and CHET00973A
Collection Account
Number

2. Bangalore - Brigade Road

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.(T)11/73 March 31, 1973 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
-3
2. Tax Deduction and BLRT00179E

334
 Collection Account
Number

3. Coimbatore - Raja Street

S. Approval/ License Issuing Reference No. Date of Validity

No. authority issuance
1. Registration under Assistant DBS(Che)BL/5236/02.05.01/2004- May 24, 2005* -
Section 23 of the General 05
Banking Regulation Manager,
Act Department of
Banking
Supervision,
RBI, Chennai
2. Tax Deduction and CMBT03195D
Collection Account
Number
*
This letter dated May 24, 2005 has been received in lieu of the original license which had been issued with respect to the branch and which
was subsequently not traceable.

4. Thrissur - College Road

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Joint Chief BL. 2/89 February 17, 1989 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
–3
2. Tax Deduction and CHNC00225B
Collection Account
Number

5. Chennai-1 Beach Road

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.T.54/73 October 23, 1973 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations, RBI,
Trivandrum – 3
2. Tax Deduction and CHET07911B
Collection Account
Number

6. Ernakulam - Market Road

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

335
No.
1. Registration under Section RBI Branch Code Part I – November 15, 1928 -
23 of the Banking 6070026; Part II
Regulation Act* 9700008
2. Tax Deduction and CHNC00458D
Collection Account
Number
*
The license is not traceable, the details provided herein are based on a search conducted on the website of the Database of Indian
Economy maintained by the RBI

7. Fort, Mumbai

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Section Assistant Chief BL.T.4/77 January 11, 1977, as -
23 of the Banking Officer, amended on
Regulation Act Department of October 16, 1987
and November 18,
Banking
2004
Operations, RBI,
Trivandrum
2. Tax Deduction and MUMT10570A
Collection Account
Number

8. Kollam

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy General BL(T)21/72 March 22, 1972, as -
23 of the Banking Manager, amended on April 12,
Regulation Act Department of 2005
Banking
Supervision,
Trivandrum
2. Tax Deduction and TVDT00724D
Collection Account
Number

9. Tirupur

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.T.84/81 December 1, 1981 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations, RBI,
Trivandrum
2. Tax Deduction and CMBT03862F
Collection Account
Number

10. New Delhi

336
 S. Approval/ License Issuing authority Reference No. Date of issuance Validity
No.
1. Registration under Section Deputy Chief BL.T.27/81 March 26, 1981, as -
23 of the Banking Officer, amended on January
Regulation Act Department of 4, 1997 and October
3, 1996
Banking
Operations, RBI,
Trivandrum
2. Tax Deduction and DELT05104B
Collection Account
Number

11. IFB-Mumbai

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Section Deputy Chief BL.B.307 December 28, 1994 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations, RBI,
Mumbai
2. Tax Deduction and MUMT10561F
Collection Account
Number

12. Chandigarh

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Section Assistant General DBOD(CHG)/1151/02. June 6, 2003 -
23 of the Banking Manager, 02.68x/2002-03
Regulation Act Department of
Banking
Operations and
Development,
RBI, Chandigarh
2. Tax Deduction and PTLT10881D
Collection Account
Number

13. Guruvayoor

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Deputy Chief BLT 46/64 October 13, 1964 -
Section 23 of the Officer,
Banking Regulation Act Department of
Banking
Operations, RBI,
Trivandrum

337
2. Tax Deduction and CHNC00227D
Collection Account
Number

14. T. Nagar, Chennai

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Section Deputy Chief BL(M).No.79/02.05.24/93- December 1, 1993 -
23 of the Banking Officer, 94
Regulation Act Department of
Banking
Operations, RBI,
Chennai
2. Tax Deduction and CHET02030A
Collection Account
Number

15. Jaipur

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy General BL.(JPR.)No.2507 February 10, 2004 -
23 of the Banking manager,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Jaipur
2. Tax Deduction and JPRT01440F
Collection Account
Number

16. Kowdiar

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Joint Chief BL.T.2/93 February 17, 1993 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
2. Tax Deduction and TVDC00410E
Collection Account
Number

17. Kakkanad

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.T.45/75 April 9, 1975, as -

338
 23 of the Banking Officer, amended on February
Regulation Act Department of 13, 2004, May 24,
Banking 2003 and May 24,
2006
Operations, RBI,
Trivandrum – 3
2. Tax Deduction and CHNC00466E
Collection Account
Number

18. Tiruchirappally

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.T.13/75 March 15, 1975 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
–3
2. Tax Deduction and CHET05256G
Collection Account
Number

19. Puthiyakavu

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Deputy Chief BL.T.75/76 June 16, 1976 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
–3
2. Tax Deduction and TVDT01018D
Collection Account
Number

20. Ernakulam - Banerji Road

S. Approval/ License Issuing Reference No. Date of Validity

No. authority issuance
1. Registration under Deputy General DBOD(T)No.3087/03/05.01/2003- April 15, 2004 -
Section 23 of the Manager, 04
Banking Regulation Department of
Act Banking
Operations and
Development,
RBI,
Trivandrum

339
2. Tax Deduction and CHNC00465D
Collection Account
Number

21. Chennai-2 Mount Road

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Joint Chief BL.T.72/84 September 27, 1984 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
2. Tax Deduction and CHET07356G
Collection Account
Number

22. Ashok Vihar – Delhi

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.
1. Registration under Section Joint/ Deputy BL.D.6170 May 8, 1996 -
23 of the Banking Chief Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, New Delhi
2. Tax Deduction and DELT04683A
Collection Account
Number

23. Mahim West, Mumbai

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Deputy General BL.M.1383 November 18, -
Section 23 of the Banking Manager, 2003
Regulation Act Department of
Banking
Operations and
Development,
RBI, Mumbai
2. Tax Deduction and MUMT10209D
Collection Account
Number

24. Chembur, Mumbai

S. Approval/ License Issuing authority Reference No. Date of issuance Validity

No.

340
1. Registration under Section Assistant Chief BL.T.38/72 April 28, 1972 -
23 of the Banking Officer,
Regulation Act Department of
Banking
Operations and
Development,
RBI, Trivandrum
–3
2. Tax Deduction and MUMT03372F
Collection Account
Number

25. Puducherry

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Registration under Section Deputy Chief BL.(M)No.1/OPR/3(7)/87- January 7, 1988, as -
23 of the Banking Officer, 88 amended on
Regulation Act Department of December 10, 2004
and March 7, 2007
Banking
Operations and
Development,
RBI, Chennai
2. Tax Deduction and CHET03010A
Collection Account
Number

Material employee and labour approvals

S. Approval/ License Issuing Reference No. Date of issuance Validity

No. authority
1. Approval to Catholic Commissioner of C.No. 4C/Tech-3/96-97 January 21, 1998 -
Syrian Bank Limied Income Tax,
Employees Pension Fund, Cochin
Trichur
2. Approval to Catholic Commissioner of No. CIT/CHN/Tech/Gty- February 11, 2000 -
Syrian Bank Limied Income Tax, 16/99-2000
Gratuity Fund, Trichur Cochin
3. Order under Income Tax Commissioner of C.H.601-58(a)/51 October 16, 1950
Act (Act No.XI of 22) Income Tax,
according recognition to Cochin
The Catholic Syrian
Bank Limied Employee
Provident Fund, Trichur

341
Intellectual property

a. Our logo “ ” is registered (No. 1255739, class 36) under the Trade Marks Act,
1999 and such registration is valid up to December 16, 2023.
b. Our ATM/debit card services logo is registered (No. 1652341, class 36) under the Trade Marks
Act, 1999 and such registration is valid up to February 11, 2018.

342
 OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for this Issue

 Our Board has, pursuant to its resolution dated December 22, 2014, authorised the Issue, subject to the approval
by the shareholders of our Bank under Section 62(1)(c) of the Companies Act, 2013.
 The shareholders of our Bank have authorised the Issue by a special resolution passed pursuant to Section
62(1)(c) of the Companies Act, 2013 at the EGM held on February 19, 2015 and authorised the Board to take
decisions in relation to this Issue.
 Our Bank has applied to the BSE and the NSE for obtaining their in-principle approval for listing of the Equity
Shares under this Issue and has received the in-principle approvals from the BSE and the NSE pursuant to their
letters dated [●] and [●], respectively. For the purposes of this Issue, the [●] shall be the Designated Stock
Exchange.

Prohibition by RBI

Neither our Bank nor our Directors have been declared as wilful defaulters by the RBI or any other governmental
authority. Further, there has been no violation of any securities law committed by any of them in the past and no
such proceedings are currently pending against any of them.

Prohibition by SEBI or governmental authorities

We confirm that our Bank or Directors have not been prohibited from accessing or operating in the capital markets
under any order or direction passed by SEBI or any regulatory or governmental authority.

The companies with which our Directors are or were associated as a promoter, directors or persons in control have
not been debarred from accessing capital markets under any order or direction passed by SEBI or any other
regulatory or governmental authority.

None of our Directors are associated with the securities market in any manner, including securities market related
business.

Eligibility for this Issue

Our Bank is an unlisted company, complying with the conditions specified in Regulation 26(1) of the SEBI
Regulations in the following manner:

 Our Bank has net tangible assets of at least ` 30 million in each of the preceding three full years (of 12 months
each), of which not more than 50% are held in monetary assets;
 Our Bank has a minimum average pre-tax operating profit of ` 150 million, calculated on restated and
consolidated basis during the three most profitable years out of the immediately preceding five years;
 Our Bank has a net worth of at least ` 10 million in each of the three preceding full years (of 12 months each);
 The aggregate size of the proposed Issue and all previous issues made in the same financial years in terms of the
issue size is not expected to exceed five times the pre-Issue net worth of our Bank as per the audited balance
sheet of the preceeding financial year; and
 Our Bank has not changed its name in the last one year.

Our Bank’s, net worth, net tangible assets and monetary assets derived from the restated audited financial statements
included in this Draft Red Herring Prospectus, as on and for the Fiscals 2012, 2013 and 2014, are as given below:

(In ` million)

343
 Particulars Fiscal Year Fiscal Year Fiscal Year
2012 2013 2014
Net Worth(1) 4,949.74 5,799.74 6,198.60
Net Tangible assets(2) 119,754.07 134,486.34 151,653.82
Monetary assets (3) 3,999.67 6,191.41 14,284.00
Monetary assets as a percentage of the net tangible assets (3)/ (2) 3.34 4.60 9.42

(1) 'Net worth' has been defined as the aggregate of the paid up share capital, securities premium account, and reserves and surplus (excluding
revaluation reserve) as reduced by the aggregate of the miscellaneous expenditure (to the extent not adjusted or written-off) and the debit
balance of the profit and loss account.
(2) 'Net tangible assets' means the sum of all net assets of our Bank excluding intangible assets as defined in Accounting Standard 26 issued by
Institute of Chartered Accountants of India.
(3) Monetary assets comprise of cash and bank balances

Our Bank’s average pre-tax operating profit derived from the audited restated financial statements included in this
Draft Red Herring Prospectus, for the Fiscal Years 2012, 2013 and 2014, are as given below:

(In ` million)
Particulars Fiscal Year 2012 Fiscal Year Fiscal Year
2013 2014
Pre-Tax Operating Profit (1) 297.04 327.46 468.98
Average pre-tax operating profit is ` 364.49 million

(1) Calculated on the basis of restated audited Financial Statements.

In accordance with Regulation 26(4) of the SEBI Regulations, our Bank shall ensure that the number of prospective
Allottees to whom the Equity Shares will be Allotted shall not be less than 1,000; otherwise the entire application
money will be refunded. In case of delay, if any, in refund, our Bank shall pay interest on the application money at
the rate of 15% p.a. for the period of delay.

This Issue is being made for at least 25% of the fully diluted post-Issue capital, pursuant to Rule 19(2)(b)(i) of the
SCRR read with Regulation 41 of the SEBI Regulations. Our Bank is eligible for the Issue in accordance with
Regulation 26(1) of the SEBI Regulations. Further, this Issue is being made through the Book Building Process
wherein 50% of the Net Issue shall be available for allocation to QIBs on a proportionate basis. Our Bank may, in
consultation with the BRLMs, allocate up to 60% of the QIB Portion to Anchor Investors at the Anchor Investor
Allocation Price, on a discretionary basis, out of which at least one-third will be available for allocation to domestic
Mutual Funds only. In the event of under-subscription or non-allocation in the Anchor Investor Portion, the balance
of Equity Shares shall be added to the Net QIB Portion. Such number of Equity Shares representing 5% of the Net
QIB Portion shall be available for allocation on a proportionate basis to Mutual Funds only, and the remainder shall
be available for allocation on a proportionate basis to all QIB Bidders, including Mutual Funds, subject to valid Bids
being received at or above the Issue Price. Further, not less than 15% of the Net Issue will be available for allocation
on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Net Issue will be available for
allocation to Retail Individual Bidders in accordance with the SEBI Regulations, subject to valid Bids being
received at or above the Issue Price. Further, [●] Equity Shares, aggregating up to ` 100 million, shall be available
for allocation on a proportionate basis to the Eligible Employees Bidding under the Employee Reservation Portion,
subject to valid bids being received at or above the Issue Price. For further details, see section titled “Issue
Procedure” beginning at 367.

Our Bank is in compliance with the following conditions specified under Regulation 4(2) of the SEBI Regulations:

(a) Our Bank, our Directors and the companies with which our Directors are associated as directors or promoters or
persons in control have not been prohibited from accessing or operating in the capital markets under any order
or direction passed by SEBI;

(b) Our Bank has applied to the BSE and the NSE for obtaining their in-principle listing approval for listing of the
Equity Shares under this Issue and has received the in-principle approvals from the BSE and the NSE pursuant
to their letters dated [●] and [●], respectively. For the purposes of this Issue, the [●] shall be the Designated
Stock Exchange;

344
(c) Our Bank has entered into agreements dated April 12, 2010 and March 20, 2003 with NSDL and CDSL,
respectively, for dematerialisation of the Equity Shares;

(d) The Equity Shares are fully paid-up and there are no partly paid-up Equity Shares as on the date of this Draft
Red Herring Prospectus.

We propose to meet our expenditure towards the objects of the Issue entirely out of the proceeds of the Issue, and
hence, no amount is proposed to be raised through any other means of finance. Accordingly, Regulation 4(2)(g) read
with Clause VII C (1) of Part A of Schedule VIII of the SEBI Regulations (which requires firm arrangements of
finance through verifiable means for 75% of the stated means of finance, excluding the amount to be raised through
the proposed issue) does not apply. For further details in this regard, see section titled “Objects of the Issue”
beginning at page 96.

Disclaimer Clause of SEBI

AS REQUIRED, A COPY OF THIS DRAFT RED HERRING PROSPECTUS HAS BEEN SUBMITTED TO
SEBI. IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF THIS DRAFT RED
HERRING PROSPECTUS TO SEBI SHOULD NOT, IN ANY WAY, BE DEEMED OR CONSTRUED TO
MEAN THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE
ANY RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE
PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE OR FOR THE CORRECTNESS OF
THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THIS DRAFT RED HERRING
PROSPECTUS. THE BOOK RUNNING LEAD MANAGERS ICICI SECURITIES LIMITED AND
KOTAK MAHINDRA CAPITAL COMPANY LIMITED HAVE CERTIFIED THAT THE DISCLOSURES
MADE IN THIS DRAFT RED HERRING PROSPECTUS ARE GENERALLY ADEQUATE AND ARE IN
CONFORMITY WITH SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND
DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 IN FORCE FOR THE TIME BEING. THIS
REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR
MAKING AN INVESTMENT IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE BANK IS PRIMARILY

RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT
INFORMATION IN THIS DRAFT RED HERRING PROSPECTUS, THE BOOK RUNNING LEAD
MANAGERS ARE EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE BANK
DISCHARGES ITS RESPONSIBILITIES ADEQUATELY IN THIS BEHALF AND TOWARDS THIS
PURPOSE, THE BOOK RUNNING LEAD MANAGERS HAVE FURNISHED TO SEBI, A DUE
DILIGENCE CERTIFICATE DATED MARCH 30, 2015, WHICH READS AS FOLLOWS:

WE, THE BRLMs TO THE ABOVE MENTIONED FORTHCOMING ISSUE, STATE AND CONFIRM AS
FOLLOWS:

(1) “WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO

LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH
COLLABORATORS ETC. AND OTHER MATERIAL DOCUMENTS IN CONNECTION WITH
THE FINALIZATION OF THE DRAFT RED HERRING PROSPECTUS DATED MARCH 30,
2015 (“DRHP”) PERTAINING TO THE SAID ISSUE.

(2) ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE BANK, ITS
DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES AND INDEPENDENT
VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE,
PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS AND OTHER PAPERS
FURNISHED BY THE BANK, WE CONFIRM THAT:

(a) THE DRAFT RED HERRING PROSPECTUS FILED WITH THE SECURITIES AND
EXCHANGE BOARD OF INDIA IS IN CONFORMITY WITH THE DOCUMENTS,

345
 MATERIALS AND PAPERS RELEVANT TO THE ISSUE;

(b) ALL THE LEGAL REQUIREMENTS RELATING TO THE ISSUE AS ALSO THE
REGULATIONS, GUIDELINES, INSTRUCTIONS, ETC. FRAMED/ISSUED BY SEBI,
THE CENTRAL GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN
THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND

(c) THE DISCLOSURES MADE IN THE DRAFT RED HERRING PROSPECTUS ARE
TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL
INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND
SUCH DISCLOSURES ARE IN ACCORDANCE WITH THE REQUIREMENTS OF THE
COMPANIES ACT, 1956, THE COMPANIES ACT, 2013, THE SECURITIES AND
EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE
REQUIREMENTS) REGULATIONS, 2009 AND OTHER APPLICABLE LEGAL
REQUIREMENTS.

(3) WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE
DRAFT RED HERRING PROSPECTUS ARE REGISTERED WITH SEBI AND THAT TILL
DATE SUCH REGISTRATION IS VALID. – COMPLIED WITH
(4) WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS
TO FULFILL THEIR UNDERWRITING COMMITMENTS. – NOTED FOR COMPLIANCE

(5) WE CERTIFY THAT WRITTEN CONSENT FROM THE PROMOTERS HAVE BEEN
OBTAINED FOR INCLUSION OF THEIR EQUITY SHARES AS PART OF PROMOTERS’
CONTRIBUTION SUBJECT TO LOCK-IN AND THE EQUITY SHARES PROPOSED TO FORM
PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE
DISPOSED / SOLD / TRANSFERRED BY THE PROMOTERS DURING THE PERIOD
STARTING FROM THE DATE OF FILING THE DRAFT RED HERRING PROSPECTUS WITH
SEBI TILL THE DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE
DRAFT RED HERRING PROSPECTUS. – NOT APPLICABLE

(6) WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF

INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009
WHICH RELATES TO THE EQUITY SHARES INELIGIBLE FOR COMPUTATION OF
PROMOTERS’ CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE
DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE
IN THE DRAFT RED HERRING PROSPECTUS – NOT APPLICABLE

(7) WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C) AND
(D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SECURITIES AND EXCHANGE
BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2009 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS
HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE
RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF THE ISSUE. WE UNDERTAKE
THAT AUDITORS’ CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO
SEBI. WE FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE
THAT PROMOTERS’ CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH
A SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO THE BANK ALONG
WITH THE PROCEEDS OF THE PUBLIC ISSUE. – NOT APPLICABLE

(8) WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE BANK FOR WHICH THE FUNDS
ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE ‘MAIN OBJECTS’
LISTED IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER
CHARTER OF THE BANK AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED
OUT UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS
MEMORANDUM OF ASSOCIATION. – COMPLIED WITH

346
(9) WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE
THAT THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE
BANK ACCOUNT AS PER THE PROVISIONS OF SUB SECTION (3) OF SECTION 40 OF THE
COMPANIES ACT, 2013 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID
BANK ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGES
MENTIONED IN THE PROSPECTUS. WE FURTHER CONFIRM THAT THE AGREEMENT
ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE BANK
SPECIFICALLY CONTAINS THIS CONDITION. – NOTED FOR COMPLIANCE. ALL
MONIES RECEIVED OUT OF THE ISSUE SHALL BE CREDITED/TRANSFERRED TO A
SEPARATE BANK ACCOUNT AS REFERRED TO IN SUB-SECTION (3) OF SECTION 40 OF
THE COMPANIES ACT, 2013.

(10) WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT RED HERRING
PROSPECTUS THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE
SHARES IN DEMAT OR PHYSICAL MODE. – NOT APPLICABLE. UNDER SECTION 29 OF
THE COMPANIES ACT, 2013, EQUITY SHARES IN THE ISSUE HAVE TO BE ISSUED IN
DEMATERIALISED FORM ONLY.

(11) WE CERTIFY THAT ALL THE APPLICABLE DISCLOSURES MANDATED IN THE

SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE
REQUIREMENTS) REGULATIONS, 2009 HAVE BEEN MADE IN ADDITION TO
DISCLOSURES WHICH, IN OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE
INVESTOR TO MAKE A WELL INFORMED DECISION.

(12) WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT
RED HERRING PROSPECTUS:

(a) AN UNDERTAKING FROM THE BANK THAT AT ANY GIVEN TIME, THERE SHALL
BE ONLY ONE DENOMINATION FOR THE EQUITY SHARES OF THE BANK; AND

(b) AN UNDERTAKING FROM THE BANK THAT IT SHALL COMPLY WITH SUCH
DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY SEBI FROM TIME TO
TIME.

(13) WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO

ADVERTISEMENT IN TERMS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE
MAKING THE ISSUE. – NOTED FOR COMPLIANCE

(14) WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN
EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS BACKGROUND OF
THE BANK, SITUATION AT WHICH THE PROPOSED BUSINESS STANDS, THE RISK
FACTORS, PROMOTERS’ EXPERIENCE, ETC. – REFER TO ANNEXURE A TO THIS
CERTIFICATE

(15) WE ENCLOSE A CHECKLIST CONFIRMING REGULATION-WISE COMPLIANCE WITH

THE APPLICABLE PROVISIONS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA
(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009,
CONTAINING DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE STATUS
OF COMPLIANCE, PAGE NUMBER OF THE DRAFT RED HERRING PROSPECTUS WHERE
THE REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY. – REFER
TO ANNEXURE B TO THIS CERTIFICATE

(16) WE ENCLOSE STATEMENT ON ‘PRICE INFORMATION OF PAST ISSUES HANDLED BY

THE MERCHANT BANKERS (WHO ARE RESPONSIBLE FOR PRICING THIS ISSUE), AS

347
 PER FORMAT SPECIFIED BY SEBI THROUGH CIRCULAR. – REFER ANNEXURE C TO
THIS CERTIFICATE.

(17) WE CERTIFY THAT PROFITS FROM RELATED PARTY TRANSACTIONS HAVE ARISEN
FROM LEGITIMATE BUSINESS TRANSACTIONS. – COMPLIED WITH TO THE EXTENT OF
THE RELATED PARTY TRANSACTIONS OF THE BANK IN ACCORDANCE WITH
ACCOUNTING STANDARD 18 IN THE FINANCIAL STATEMENTS OF THE BANK
INCLUDED IN THE DRAFT RED HERRING PROSPECTUS”.
*
Section 40(3) of the Companies Act, 2013 has been notified by the Ministry of Corporate Affairs, Government of India.
**
Section 29 of the Companies Act, 2013 provides, inter alia, that every company making public offers shall issue securities only in
dematerialised form by complying with the provisions of the Depositories Act, 1996 and the regulations made thereunder.

The filing of this Draft Red Herring Prospectus does not, however, absolve our Bank from any liabilities
under Section 34 and Section 36 of the Companies Act, 2013 or from the requirement of obtaining such
statutory and/or other clearances as may be required for the purpose of the proposed Issue. SEBI further
reserves the right to take up at any point of time, with the BRLMs, any irregularities or lapses in this Draft
Red Herring Prospectus, the Red Herring Prospectus and the Prospectus.

All legal requirements pertaining to this Issue will be complied with at the time of filing of the Red Herring
Prospectus with the Registrar of Companies in terms of Section 32 of the Companies Act, 2013. All legal
requirements pertaining to this Issue will be complied with at the time of registration of the Prospectus with
the Registrar of Companies in terms of Sections 26, 32, 33(1) and 33(2) of the Companies Act, 2013.

Price information of past issues handled by the BRLMs

The price information of past issues handled by the BRLMs is as follows:

348
ICICI Securities Limited:
Price information of past issues handled by ICICI Securities Limited
%
Change Closing Closing Closing
Benchmar Benchmar Benchmar
in Price price as price as price as
Openin Closin k index as k index as k index as
Issu on Benchmar on 10th on 20th on 30th
Sr Issue g Price g Price on 10th on 20th on 30th
e listing k index on calenda calenda calenda
No Issue Name Size(`million Listing Date on on calendar calendar calendar
Pric date listing date r day r day r day
. ) Listing Listing days from days from days from
e ( `) (Closing (Closing) from from from
Date Date listing day listing day listing day
) vs. listing listing listing
(Closing) (Closing) (Closing)
Issue date date date
Price
1. Shemaroo 1,200.00 170(2 October 1, 2014 180 171.00 0.59%7945.55 154.00 7,859.95 160.35 7927.75 163.95 8322.20
)
Entertainmen
t Limited
2. Wonderla 1,812.50 125 May 9, 2014 160 157.80 26.24% 6858.80 166.80 7,263.55 212.60 7235.65 216.15 7654.60
Holidays
Limited
3. Bharti 41,727.60 220(1 December 28, 200 191.65 -12.89% 5,908.35 207.40 5,988.40 204.95 6,039.20 210.30 6,074.80
)
Infratel 2012
Limited
4. Credit 5,399.78 750 December 26, 940 922.55 23.01% 5,905.60 929.25 5,988.40 931.05 6,056.60 924.85 6,074.65
Analysis and 2012
Research
Limited
5. Tara Jewels 1,794.99 230 December 6, 2012 242 229.90 -0.04% 5,930.90 230.25 5,857.90 223.75 5,905.60 234.00 5,988.40
Limited
(1)
Discount of ` 10 per equity share offered to retail investors and Premium of`10 per equity share to Anchor investors. All calculations are based on Issue Price of ` 220.00 per equity share
(2)
Discount of ` 17 per equity share offered to retail investors. All calculations are based on Issue Price of ` 170.00 per equity share
Notes:
1. All data sourced from www.nseindia.com
2. Benchmark index considered is NIFTY
3. 10th, 20th, 30th calendar day from listed day have been taken as listing day plus 10, 20 and 30 calendar days, except wherever 10th, 20th, 30th calendar day is a holiday, in which case we have considered the closing data
of the next trading date/day

Summary statement of price information of past issues handled by ICICI Securities Limited

Nos. of IPOs trading at discount

Total Nos. of IPOs trading at discount No. of IPOs trading at premium Nos. of IPOs trading at premium as on
Total as on 30th calendar day from
Funds on listing date on listing date 30th calendar day from listing date
No. listing date
Financial Year Raised
of Less Less Less
(` Over Between Over Between Over Between Over Between
IPO's than than than Less than 25%
million) 50% 25-50% 50% 25-50% 50% 25-50% 50% 25-50%
25% 25% 25%
2014-15 2 3,012.50 0 0 0 0 1 1 0 0 1 1 0 0
2013-14 0 Nil 0 0 0 0 0 0 0 0 0 0 0 0
2012-13 3 48,922.37 0 0 2 0 0 1 0 0 1 0 0 2

349
 Kotak Mahindra Capital Company Limited:

Price information of past issues handled by Kotak Mahindra Capital Company Limited

Sr Issue Name Issue Size Issue Listing date Opening Closing % Benchmar Closing Benchma Closing Benchma Closing Benchma
No (`in price (`) price on price on Change in k index on price as rk index price as rk index price as rk index
million) listing listing Price on listing date on 10th as on 10th on 20th as on 20th on 30th as on 30th
date date listing (Closing) calendar calendar calendar calendar calendar calendar
date day from days from day from days from day from days from
(Closing) listing listing listing listing listing listing
vs. Issue day day day day day day
Price (Closing) (Closing) (Closing)
1. Ortel Communications Limited 1,736.49 181.00 March 19, 2015 160.05 162.25 -10.36% 8,634.65 147.50 8,492.30 NA NA NA NA
2. Bharti Infratel Limited(1) 41,727.60 220.00 December 28, 200.00 191.65 -12.89% 5,908.35 207.40 5,988.40 204.40 6,001.85 210.30 6,074.80
2012
3. PC Jeweller Limited(2) 6,013.08 135.00 December 27, 137.00 149.20 10.52% 5,870.10 181.65 5,988.40 168.90 6,056.60 157.55 6,074.65
2012
4. Credit Analysis & Research 5,399.78 750.00 December 26, 940.00 922.55 23.01% 5,905.60 934.75 6,016.15 923.45 6,024.05 920.85 6,019.35
Limited 2012
5. Speciality Restaurants Limited 1,760.91 150.00 May 30, 2012 152.00 159.60 6.40% 4,950.75 182.45 5,068.35 206.65 5,064.25 213.05 5,149.15
Source: www.nseindia.com
(1)
In Bharti Infratel Limited, the anchor investor issue price was ` 230 per equity share and the issue price after discount to Retail Individual Bidders was ` 210 per equity share.
(2)
In PC Jeweller Limited, the issue price after discount to Retail Individual Bidders and Eligible Employees was ` 130 per equity share.
NA: Not available

Summary statement of price information of past issues handled by Kotak Mahindra Capital Company Limited

Fiscal Year Total No. of Total Funds No. of IPOs trading at discount on No. of IPOs trading at premium on No. of IPOs trading at discount as on No. of IPOs trading at premium
IPOs Raised (` listing date listing date 30th calendar day from listing day as on 30th calendar day from
Million) listing day
Over Between Less than Over 50% Between Less than Over 50% Between 25- Less Over Between Less
50% 25-50% 25% 25-50% 25% 50% than 50% 25-50% than
25% 25%
April 1, 2014 – 1 1,736.49 - - 1 - - - NA NA NA NA NA NA
March 30, 2015
2013-14 - - - - - - - - - - - - - -
2012-13 4 54,901.36 - - 1 - - 3 - - 1 - 1 2
NA – Not available

350
Track record of past issues handled by the BRLMs

For details regarding the track record of the BRLMs, as specified in Circular reference CIR/MIRSD/1/2012 dated
January 10, 2012 issued by SEBI, please refer to their websites, as set forth in the table below:

Sr. No Name of the Manager Website

1. ICICI Securities Limited www.icicisecurities.com
2. Kotak Mahindra Capital Company Limited http:// investmentbank.kotak.com/track-record/Disclaimer.html

Caution - Disclaimer from our Bank, our Directors and the BRLMs

Our Bank, our Directors and the BRLMs accept no responsibility for statements made otherwise than those
contained in this Draft Red Herring Prospectus or in any advertisements or any other material issued by or at our
Bank’s instance. Anyone placing reliance on any other source of information, including our Bank’s website,
www.csb.co.in would be doing so at his or her own risk.

The BRLMs accept no responsibility, save to the limited extent as provided in the Issue Agreement and the
Underwriting Agreement to be entered into between the Underwriters, our Bank and Registrar to the Issue.

All information shall be made available by our Bank and the BRLMs to the public and investors at large and no
selective or additional information will be made available for a section of investors in any manner whatsoever
including at road show presentations, in research or sales reports, at Syndicate Bidding Centres or elsewhere.

Neither our Bank, nor any member of the Syndicate shall be liable to Bidders for any failure in uploading the Bids
due to faults in any software/hardware system or otherwise.

Bidders will be required to confirm and will be deemed to have represented to our Bank and the Underwriters and
their respective directors, officers, agents, affiliates and representatives that they are eligible under all applicable
laws, rules, regulations, guidelines and approvals to acquire the Equity Shares and that they shall not issue, sell,
pledge or transfer the Equity Shares to any person who is not eligible under applicable laws, rules, regulations,
guidelines and approvals to acquire the Equity Shares. Our Bank, the Underwriters and their respective directors,
officers, agents, affiliates and representatives accept no responsibility or liability for advising any investor on
whether such investor is eligible to acquire Equity Shares.

The BRLMs and their respective affiliates may engage in transactions with, and perform services for, our Bank in
the ordinary course of business and have engaged, or may in the future engage, in transactions with our Bank, for
which they have received, and may in the future receive, compensation.

Disclaimer in Respect of Jurisdiction

This Issue is being made in India to persons resident in India, including Indian nationals resident in India who are
competent to contract under the Indian Contract Act, 1872, as amended, HUFs, companies, corporate bodies and
societies registered under applicable laws in India and authorised to invest in shares, Mutual Funds registered with
SEBI, Indian financial institutions, commercial banks, regional rural banks, co-operative banks (subject to RBI
permission), or trusts under applicable trust law and who are authorised under their respective constitutions to hold
and invest in shares, public financial institutions as specified in Section 2(72) of the Companies Act, 2013,
multilateral and bilateral development financial institutions, state industrial development corporations, insurance
companies registered with the IRDA, provident funds (subject to applicable law) with minimum corpus of ` 250
million and pension funds with minimum corpus of ` 250 million, National Investment Fund, insurance funds set up
and managed by army, navy or air force of Union of India, insurance funds set up and managed by the Department
of Posts, GoI and permitted Non-Residents including FIIs, FPIs and Eligible NRIs and other eligible foreign
investors, if any, provided that they are eligible under all applicable laws and regulations to purchase the Equity
Shares.

This Draft Red Herring Prospectus does not, however, constitute an offer to sell or an invitation to subscribe for
Equity Shares offered hereby in any jurisdiction other than India to any person to whom it is unlawful to make an

351
offer or invitation in such jurisdiction. Any person into whose possession this Draft Red Herring Prospectus comes
is required to inform himself or herself about, and to observe, any such restrictions. Any dispute arising out of this
Issue will be subject to the jurisdiction of appropriate court(s) in Kerala, India only.

No action has been, or will be, taken to permit a public offering in any jurisdiction where action would be required
for that purpose, except that this Draft Red Herring Prospectus has been filed with SEBI for its observations.
Accordingly, the Equity Shares represented hereby may not be offered or sold, directly or indirectly, and this Draft
Red Herring Prospectus may not be distributed in any jurisdiction, except in accordance with the legal requirements
applicable in such jurisdiction. Neither the delivery of this Draft Red Herring Prospectus nor any sale hereunder
shall, under any circumstances, create any implication that there has been no change in the affairs of our Bank from
the date hereof or that the information contained herein is correct as of any time subsequent to this date.

The Equity Shares have not been and will not be registered under the US Securities Act of 1933 (“Securities
Act”) and may not be offered or sold within the United States (as defined in Regulation S under the Securities
Act), except pursuant to an exemption from, or in a transaction not subject to, the registration requirements
of the Securities Act. Accordingly, the Equity Shares are only being offered and sold outside the United States
in offshore transactions in compliance with Regulation S under the Securities Act and the applicable laws of
the jurisdiction where those offers and sales occur.

The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other jurisdiction
outside India and may not be offered or sold, and Bids may not be made by persons in any such jurisdiction, except
in compliance with the applicable laws of such jurisdiction.

Disclaimer Clause of the NSE

As required, a copy of this Draft Red Herring Prospectus shall be submitted to the NSE. The disclaimer clause as
intimated by the NSE to us, post scrutiny of this Draft Red Herring Prospectus, shall be included in the Red Herring
Prospectus prior to filing the same with the Registrar of Companies.

Disclaimer Clause of the BSE

As required, a copy of this Draft Red Herring Prospectus shall be submitted to the BSE. The disclaimer clause as
intimated by the BSE to us, post scrutiny of this Draft Red Herring Prospectus, shall be included in the Red Herring
Prospectus prior to filing the same with the Registrar of Companies.

Disclaimer Clause of the RBI

Our Bank is regulated by the RBI and we are required to adhere to the various norms, rules, guidelines and
regulations laid down by the RBI. It must be distinctly understood, however, that by regulating us, the RBI does not
undertake any responsibility for the financial soundness of our Bank or for the correctness of any of the statements
made or opinion expressed in this connection.

Filing

A copy of this Draft Red Herring Prospectus has been filed with SEBI at the Securities and Exchange Board of
India, SEBI at Corporation Finance Department, Overseas Towers, 7th Floor, 756/L Anna Salai, Chennai 600 002,
India.

A copy of the Red Herring Prospectus, along with the documents required to be filed under Section 32 of the
Companies Act, 2013 would be delivered for registration to the Registrar of Companies and a copy of the Prospectus
to be filed under Section 26 of the Companies Act, 2013 would be delivered for registration with Registrar of
Companies at the office of the Registrar of Companies:

The Registrar of Companies, Kerala

Registrar of Companies
Company Law Bhawan, BMC Road

352
Thrikkakara, Kochi 682 021
Kerala, India

Listing

The Equity Shares issued under the Issue are proposed to be listed on the BSE and the NSE. Initial listing
applications will be made to the Stock Exchanges for permission to deal in, and for an official quotation of the
Equity Shares. The [●] will be the Designated Stock Exchange with which the ‘Basis of Allotment’ will be finalised.

If the permissions to deal in and for an official quotation of the Equity Shares is not granted by any of the Stock
Exchanges, our Bank will forthwith repay, without interest, all moneys received from the applicants in pursuance of
the Red Herring Prospectus/Prospectus, as required under applicable law. If such money is not repaid within the
prescribed time, then our Bank and every officer in default shall be liable to repay the money, with interest, as
prescribed under applicable law.

Our Bank shall ensure that all steps for the completion of the necessary formalities for listing and commencement of
trading at all the Stock Exchanges are taken within 12 Working Days of the Bid Closing Date. If Equity Shares are
not Allotted within 12 Working Days from the Bid Closing Date or within such timeline as prescribed by the SEBI,
our Bank shall repay without interest all monies received from applicants, failing which interest shall be due to be
paid to the applicants at the rate of 15% per annum for the delayed period.

Consents

Consents in writing of (a) our Directors, our Company Secretary and Compliance Officer, BRLMs, the Auditor, the
lenders to our Bank, the legal counsels and the Registrar to the Issue have been obtained; and consents in writing of
(b) the Syndicate Members, the Escrow Collection Banks and the Refund Banks if appointed, to act in their
respective capacities, will be obtained and filed along with a copy of the Red Herring Prospectus with the Registrar
of Companies as required under Sections 26 and 32 of the Companies Act, 2013. Further, such consents have not
been withdrawn up to the time of filing of this Draft Red Herring Prospectus with SEBI.

In accordance with the Companies Act, 2013 and the SEBI Regulations, M/s. Sundaram & Srinivasan, Chartered
Accountants and M/s. Varma & Varma, Chartered Accountants have given their written consent under section 26 of
the Companies Act, 2013, in their capacity as statutory auditors of our Bank and as experts as defined in section
2(38) of the Companies Act, 2013, for inclusion of their name, examination reports dated March 30, 2015 on
restated audited financial statements and statement of tax benefits dated March 30, 2015, in this Draft Red Herring
Prospectus issued in the form and context in which they appear in this Draft Red Herring Prospectus. Such consent
has not been withdrawn up to the time of filing of this Draft Red Herring Prospectus with SEBI.

Expert Opinion

Except as stated below, our Bank has not obtained any expert opinions:

Our Bank has received consent from the Auditors, M/s. Sundaram & Srinivasan, Chartered Accountants and M/s.
Varma & Varma, Chartered Accountants to include their name as an expert under Section 26 of the Companies Act,
2013 in this Draft Red Herring Prospectus in relation to their reports for our restated audited financial statements,
the restated financial statements and statement of tax benefits.

Issue Expenses

The Issue related expenses consist of fees payable to the BRLMs, underwriting commission, brokerage and selling
commission, commission payable to Registered Brokers, SCSBs’ fees, IPO grading, Escrow Banks’ and Registrar’s
fees, printing and stationery expenses, advertising and marketing expenses and all other incidental and
miscellaneous expenses for listing the Equity Shares on the Stock Exchanges. The total expenses of the Issue are
estimated to be approximately ` [●] million.

The break-down for the Issue expenses is as follows:

353
 S. Activity Expense Amount* Percentage of Total Percentage of
No. (` in million) Estimated Issue Issue Size*
Expenses*
1. Fees of the BRLMs, underwriting commission, [●] [●] [●]
brokerage and selling commission (including
commissions to SCSBs for ASBA Applications) and
Commission payable to Registered Brokers
2. Processing fee to the SCSBs for processing Bid cum [●] [●] [●]
Application Forms procured by Syndicate/Sub
Syndicate and submitted to SCSBs or procured by
Registered Brokers**
3. Advertising and marketing expenses, printing and [●] [●] [●]
stationery, distribution, postage etc.
4. Fees to the Registrar to the Issue [●] [●] [●]
5. Listing fees and other regulatory expenses [●] [●] [●]
6. Other expenses (Legal advisors, Auditors and other [●] [●] [●]
Advisors etc.)
Total Estimated Issue Expenses [●] [●] [●]
*
To be completed after finalisation of the Issue Price
**
SCSBs would be entitled to a processing fee of ` [●] per Bid cum Application Form, for processing the Bid cum Application Forms procured by
the members of the Syndicate and submitted to SCSBs.

Fees, Brokerage and Selling Commission Payable to the Syndicate

The total fees payable to the Syndicate (including underwriting commission, brokerage and selling commission and
reimbursement of their out-of-pocket expense) will be as stated in the engagement letters, copies of which will be
made available for inspection at our Registered Office from 10.00 am to 4.00 pm on Working Days from the date of
the Red Herring Prospectus until the Bid Closing Date.

Fees Payable to the Registrar to the Issue

The fees payable by our Bank to the Registrar to the Issue for processing of application, data entry, printing of
Allotment Advice/refund order, preparation of refund data on magnetic tape, printing of bulk mailing register will be
as per the agreement dated March 28, 2015 entered into, among our Bank and the Registrar to the Issue, a copy of
which is available for inspection at the Registered Office.

The Registrar to the Issue will be reimbursed for all out-of-pocket expenses including cost of stationery, postage,
stamp duty and communication expenses. Adequate funds will be provided to the Registrar to the Issue to enable it
to send such refund in any of the modes described in the Red Herring Prospectus or Allotment Advice by registered
post/speed post/ordinary post.

Public or rights issues during the last five years

Provided below are details of rights issues made by our Bank in the last five years. Our Bank has not made any
public issue since its incorporation.

Year of issue Closing Date Date of allotment Date of refunds Date of listing on the Premium/
recognised stock discount amount
exchange (in `)
2013 March 23, 2013 March 30, 2013 April 3, 2013 N.A. 65
2015 March 23, 2015 March 27, 2015 -* N.A. 65
*
The process of refunds is currently ongoing.

For further details, including amounts paid by way of premium on Equity Shares issued within two years from the
date of this Draft Red Herring Prospectus, see the section titled “Capital Structure” on page 81.

354
Previous issues of securities otherwise than for cash

Except as disclosed under the section titled “Capital Structure - Share Capital History” beginning at page 83, our
Bank has not issued any securities for consideration other than cash.

Capital issuances in the preceding three years

Provided below are details of capital issuances made by the Bank in the last three years.

Year of Type of issue Amount of issue Date of closure of Date of completion Date of
issue (Public/ rights/ (in ` million) issue of shares/ debenture completion of
composite) certificates project (where
the object of the
issue was
financing the
project)
2013 Rights issue 784.63 March 23, 2013 April 11, 2013 N.A.
2015 Rights issue 1,131.33 March 23, 2015 -* N.A.
*
The process of dispatch of share certificates/ demat credits is currently ongoing.

For details and rates of dividends paid on these Equity Shares, see the section titled “Dividend Policy” on page 189.

Performance vis-à-vis objects

Our Bank has not made any public issue of securities since its incorporation. For a list of rights issues made by our
Bank in the last ten years immediately preceeding the filing of this Draft Red Herring Prospectus, see the section
titled “Capital Structure” on page 81.

The objects of all of the last three rights issues made by our Bank, was augmentation of the capital base of our Bank
to increase business growth and maintain requisite capital adequacy ratios as prescribed by the RBI. These objects
have been met by our Bank.

Underwriting commission, brokerage and selling commission on previous issues

There has been no public issue of the Equity Shares in the past. Thus, no sum has been paid or has been payable as
commission or brokerage for subscribing to or procuring or agreeing to procure subscription for any of the Equity
Shares since our Bank’s inception.

Outstanding debentures or bond issues or preference shares

Except as disclosed in the sections titled “Financial Indebtedness” and “Capital Structure” on page 248 and 81,
respectively, our Bank has no outstanding debentures or bonds or redeemable preference shares or other instruments
as of the date of this Draft Red Herring Prospectus.

Stock Market Data of the Equity Shares

This being an initial public issue of our Bank, the Equity Shares are not listed on any stock exchange.

Mechanism for Redressal of Investor Grievances

The agreement between the Registrar to the Issue and our Bank, dated March 28, 2015, provides for retention of
records, including refund orders despatched to the Bidders, with the Registrar to the Issue for a period of at least
three years from the date of commencement of trading of the Equity Shares, to enable the investors to approach the
Registrar to the Issue for redressal of their grievances.

355
All grievances relating to this Issue may be addressed to the Registrar to the Issue, giving full details such as name,
address of the applicant, application number, number of Equity Shares applied for, amount paid on application,
Depository Participant, and the bank branch or collection centre where the application was submitted.

All grievances relating to the ASBA process may be addressed either to (i) the concerned Syndicate/ Sub-Syndicate,
in the event of a Bid submitted by an ASBA Bidder at any of the Syndicate Bidding Centres, or or (ii) the concerned
Registered Broker and the relevant SCSB, in the event of a Bid submitted by an ASBA Bidder at any of the Non-
Syndicate Broker Centres or (ii) the SCSBs, giving full details such as name, address of the applicant, number of
Equity Shares applied for, amount paid on application and, in the event of a Bid submitted directly with a
Designated Branch by an ASBA Bidder, the Designated Branch of the SCSB where the Bid cum Application Form
was submitted by the ASBA Bidder, in both cases with a copy to the Registrar to the Issue. All grievances relating to
Bids submitted through the Registered Broker may be addressed to the Stock Exchanges with a copy to the
Registrar.

The Registrar to the Issue shall obtain the required information from the SCSBs for addressing any clarifications or
grievances of ASBA Bidders. Our Bank, the BRLMs and the Registrar to the Issue accept no responsibility for
errors, omissions, commission or any acts of SCSBs including any defaults in complying with its obligations under
applicable SEBI Regulations

Disposal of Investor Grievances by our Bank

Our Bank estimates that the average time required by our Bank or the Registrar to the Issue for the redressal of
routine investor grievances shall be 15 Working Days from the date of receipt of the complaint. In case of
complaints that are not routine or where external agencies are involved, our Bank will seek to redress these
complaints as expeditiously as possible.

Our Bank has appointed a Stakeholders’ Relationship and Share Transfer Committee. For further details, see section
titled “Our Management” on page 127.

Our Bank has appointed Mr. Sijo Varghese as the Company Secretary and Compliance Officer and he may be
contacted in case of any pre-Issue or post- Issue related problems. He can be contacted at the following address:

Mr. Sijo Varghese

Company Secretary and Compliance Officer
Board & Shares Dept., CSB Bhavan, Post Box No. 502
St. Mary’s College Road
Thrissur 680 020
Kerala, India
Telephone: +91 487 6619 228
Facsimile: +91 487 2333170
E-mail: investors @csb.co.in

Disposal of investor grievances by listed companies under the same management within the meaning of
Section 370(1B) of the Companies Act, 1956

We do not have any listed companies under the same management within the meaning of Section 370(1B) of the
Companies Act, 1956.

Change in Auditors

Except as stated below, there have been no changes in the auditors of our Bank during the three years preceding the
date of this Draft Red Herring Prospectus.

Fiscal Change in Auditor

2012 Reappointment of M/s. Essveeyar, Chartered Accountants, as statutory auditors
2013 Appointment of M/s. Varma & Varma, Chartered Accountants, as joint statutory

356
 auditors
2014 Appointment of Sundaram & Srinivasan, Chartered Accountants, as joint
statutory auditors

Capitalisation of Reserves or Profits

Our Bank has not capitalised its reserves or profits during the last five years.

Revaluation of Assets

Our Bank has undertaken revaluation of land and buildings during Fiscals 1991, 1994, 1999, 2005, 2007, 2008 and
2013. For further details, please see section titled “Financial Statements” on page 190.

Reservations, qualifications or adverse remarks by Auditors

Except as stated in the sections titled “Risk Factors – Our auditors have qualified certain matters and highlighted
certain matters of emphasis in their report on the restated financial statements for the six months ended September
30, 2014 and Fiscals 2011, 2012, 2013 and 2014” and “Financial Statements” on pages 23 and F-3 respectively,
there have been no reservations, qualifications or adverse remarks by our Auditors in the last five financial years
preceding the date of filing of the DRHP. We confirm that these highlighted matters of emphasis have no impact on
the financial statements and financial position of our Bank and therefore no corrective steps are required.

357
 SECTION VII – ISSUE INFORMATION

TERMS OF THE ISSUE

The Equity Shares being issued pursuant to this Issue are subject to the provisions of the Companies Act, 2013, the
Companies Act, 1956 (to the extent applicable) the SCRA, the SEBI Regulations, SCRR, our Memorandum and
Articles, the terms of the Red Herring Prospectus, the Prospectus, the Bid cum Application Form, the Revision
Form, the Allotment Advice, CAN, the listing agreements to be entered with the Stock Exchanges and other terms
and conditions as may be incorporated in the Allotment Advice and other documents or certificates that may be
executed in respect of this Issue. The Equity Shares shall also be subject to all applicable laws, guidelines, rules,
notifications and regulations relating to the issue of capital and listing and trading of securities issued from time to
time by the SEBI, the GoI, the Stock Exchanges, the RoC, the RBI and/or other authorities, as in force on the date of
this Issue and to the extent applicable or such other conditions as may be prescribed by the SEBI, the RBI, the
Government of India, the Stock Exchanges, the RoC and/or any other authorities while granting its approval for the
Issue.

Ranking of Equity Shares

The Equity Shares being issued in the Issue shall be subject to the provisions of the Companies Act, 2013, our
Memorandum and Articles and shall rank pari passu in all respects with the existing Equity Shares including rights
in respect of dividend. The Allottees will be entitled to dividends and other corporate benefits, if any, declared by
our Bank after the date of Allotment, in accordance with the provisions of the Companies Act, 2013 and the
Articles. Please see section titled “Main Provisions of the Articles of Association” on page 422 for a description of
significant provisions of our Articles.

Mode of Payment of Dividend

Our Bank shall pay dividends, if declared, to shareholders of our Bank as per the provisions of the Companies Act,
2013, Articles of Association, the Banking Regulation Act and the provisions of the listing agreements. For further
details in relation to dividends, see the sections titled “Risk Factors”, “Dividend Policy” and “Main Provisions of
the Articles of Association” on pages 13, 189 and 422, respectively.

Face Value and Issue Price

The face value of the Equity Shares is ` 10 each. The Floor Price of Equity Shares is ` [●] per Equity Share and the
Cap Price is ` [●] per Equity Share. The Anchor Investor Issue Price is ` [●] per Equity Share. The Price Band and
minimum Bid lot decided by our Bank, in consultation with the BRLMs, and advertised in an English national
newspaper, a Hindi national daily newspaper and a Malayalam newspaper, each with wide circulation in the place
where our Registered Office is situated, at least five Working Days prior to the Bid Opening Date and shall be made
available to the Stock Exchanges for the purpose of uploading on their website. The Price Band, along with the
relevant financial ratios calculated at the Floor Price and at the Cap Price, shall be pre-filled in the Bid cum
Application Forms available at the websites of the Stock Exchanges. The Issue Price shall be determined by our
Bank, in consultation with the BRLMs, after the Bid Closing Date, on the basis of assessment of market demand for
the Equity Shares offered by way of book building process.

At any given point of time there shall be only one denomination for the Equity Shares.

Compliance with Regulations issued by SEBI

Our Bank shall comply with all applicable disclosure and accounting norms as specified by SEBI from time to time.

Rights of the Equity Shareholders

Subject to applicable laws, rules, regulations and guidelines and the provisions of our Articles, the Equity
shareholders of our Bank shall have the following rights:

358
 The right to receive dividends, if declared;
 The right to attend general meetings and exercise voting powers, unless prohibited by law;
 The right to vote on a poll either in person or by proxy or ‘e-voting’;
 The right to receive offers for rights shares and be allotted bonus shares, if announced;
 The right to receive any surplus on liquidation subject to any statutory and other preferential claims being
satisfied;
 The right to freely transfer their Equity Shares, subject to applicable laws; and
 Such other rights, as may be available to a shareholder of a listed public company under the Companies
Act, 2013, the terms of the listing agreements to be executed with the Stock Exchanges, and our
Memorandum and Articles.

For a detailed description of the main provisions of our Articles relating to voting rights, dividend, forfeiture and
lien, transfer and transmission, and/ or consolidation/ splitting, see the section titled “Main Provisions of the Articles
of Association” on page 422.

Market Lot, Trading Lot and Option to receive Equity Shares in Dematerialised Form

Pursuant to Section 29 of the Companies Act, 2013, the Equity Shares shall be Allotted only in dematerialised form.
Hence, the Equity Shares being offered through the Red Herring Prospectus can be applied for in the dematerialised
form only. Bidders will not have the option of Allotment of the Equity Shares in physical form.

Further, as per the provisions of the SEBI Regulations, the trading of our Equity Shares shall only be in
dematerialised form, consequent to which, the tradable lot is one Equity Share. Allotment of Equity Shares will be
only in electronic form in multiples of [●] Equity Shares, subject to a minimum Allotment of [●] Equity Shares.

The Price Band and the minimum bid lot will be decided by our Bank, in consultation with the Book Running Lead
Managers, including the relevant financial ratios computed for both the Cap Price and the Floor Price, which shall
be published in an English national daily newspaper, a Hindi national daily newspaper and a Malayalam newspaper,
each with wide circulation, being the newspapers in which the pre-Issue advertisements were published, at least five
Working Days prior to the Bid Opening Date.

Joint Holders

Subject to provisions contained in our Articles, where two or more persons are registered as the holders of any
Equity Share, they shall be deemed to hold the same as joint tenants with benefits of survivorship.

Jurisdiction

Any dispute arising out of this Issue will be subject to the jurisdiction of appropriate court(s) in Kerala, India only.

The Equity Shares have not been and will not be registered under the Securities Act and may not be offered
or sold within the United States (as defined in Regulation S under the Securities Act), except pursuant to an
exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.
Accordingly, the Equity Shares are only being offered and sold outside the United States in offshore
transactions in compliance with Regulation S under the Securities Act and the applicable laws of the
jurisdiction where those offers and sales occur.

Period of operation of subscription list

See the section titled “Issue Structure – Bid/ Issue Programme” on page 364.

Nomination facility to investors

359
In accordance with Section 72 of the Companies Act, 2013, as amended, read with Companies (Share Capital and
Debentures) Rules, 2014, the sole or First Bidder, along with other joint Bidders, may nominate any one person in
whom, in the event of the death of the sole Bidder or in case of joint Bidders, the death of all the Bidders, as the case
may be, the Equity Shares Allotted, if any, shall vest. A person, being a nominee, entitled to the Equity Shares by
reason of death of the original holder(s), shall be entitled to the same advantages to which such person would be
entitled if such person were the registered holder of the Equity Share(s). Where the nominee is a minor, the holder(s)
may make a nomination to appoint, in the prescribed manner, any person to become entitled to the Equity Share(s)
in the event of his or her death during the minority. A nomination shall stand rescinded upon a sale, transfer of
Equity Share(s) by the person nominating. A nomination may be cancelled, or varied by nominating any other
person in place of the present nominee, by the holder of the Equity Shares who has made the nomination, by giving
a notice of such cancellation or variation to our Bank in the prescribed form. A buyer will be entitled to make a fresh
nomination in the manner prescribed. Fresh nomination can be made only on the prescribed form available on
request at our Registered Office or with the Registrar to the Issue and transfer agents of our Bank.

In accordance with Section 72 of the Companies Act, 2013, any person who becomes a nominee by virtue of Section
72 of the Companies Act, 2013 as mentioned above, shall, upon the production of such evidence as may be required
by our Board, elect either:

 to register himself or herself as the holder of the Equity Shares; or

 to make such transfer of the Equity Shares, as the deceased holder could have made.

Further, our Board may at any time give notice requiring any nominee to choose either to be registered himself or
herself or to transfer the Equity Shares, and if the notice is not complied with within a period of 90 days, our Board
may thereafter withhold payment of all dividends, bonuses or other monies payable in respect of the Equity Shares,
until the requirements of the notice have been complied with.

Since the Allotment will be made only in dematerialised form, there shall be no requirement for a separate
nomination with our Bank. Nominations registered with the respective Depository Participant of the applicant will
prevail. If the investors require to change their nomination, they are requested to inform their respective Depository
Participant.

Minimum Subscription

In the event our Bank does not receive (i) a minimum subscription of 90% of the Issue, and (ii) a subscription in the
Net Issue equivalent to at least 25% post-Issue paid up Equity Share capital of our Bank (the minimum number of
securities as specified under Rule 19(2)(b)(i) of the SCRR), including devolvement of Underwriters, if any, our
Bank shall forthwith refund the entire subscription amount received. If there is a delay beyond the prescribed time,
our Bank shall pay interest prescribed under the Companies Act, 2013, the SEBI Regulations and applicable law.

Further, in accordance with Regulation 26(4) of the SEBI Regulations, our Bank shall ensure that the number of
prospective allottees to whom the Equity Shares will be Allotted will be not less than 1,000.

Arrangements for disposal of odd lots

There are no arrangements for disposal of odd lots.

Restriction on transfer and transmission of shares

Except for the lock-in of the pre-Issue Equity Shares, and Allotment made to Anchor Investor pursuant to the Issue,
as detailed in the section titled “Capital Structure” on page 81 and except as provided in our Articles, there are no
restrictions on transfers and transmission of Equity Shares and on their consolidation/ splitting. See the section titled
“Main Provisions of the Articles of Association” on page 422.

360
Withdrawal of the Issue

Our Bank, in consultation with the Book Running Lead Managers, reserves the right not to proceed with the Issue
anytime after the Bid Opening Date but before the Allotment. In such an event, our Bank would issue a public notice
in the same newspapers, in which the pre-Issue advertisements were published, within two days of the Bid Closing
Date, providing reasons for not proceeding with the Issue. Further, the Stock Exchanges shall be informed promptly
in this regard by our Bank. The Book Running Lead Managers, through the Registrar to the Issue, shall notify the
SCSBs to unblock the Bank Accounts of the ASBA Bidders within one Working Day from the date of receipt of
such notification. In the event of withdrawal of the Issue and subsequently, plans of an IPO by our Bank, a draft red
herring prospectus will be submitted again to SEBI.

Notwithstanding the foregoing, this Issue is also subject to obtaining the final listing and trading approvals of the
Stock Exchanges, which our Bank shall apply for after Allotment, and the final RoC approval of the Prospectus.

361
 ISSUE STRUCTURE

Public offer of [●] Equity Shares of face value of ` 10 each, for cash at a price of ` [●] per Equity Share, including a
share premium of ` [●] per Equity Share, aggregating up to ` 4,000 million. The Issue comprises the Net Issue and
the Employee Reservation Portion. The Issue and the Net Issue shall constitute up to [●]% and [●]% approximately
of the fully diluted post-Issue paid up equity share capital of our Bank, respectively.

Our Bank, in consultation with the BRLMs, is considering the Pre-IPO Placement of up to 12,500,000 Equity Shares
for cash consideration aggregating up to ` 1,500 million, at its discretion, prior to filing of the Red Herring
Prospectus with the RoC. If the Pre-IPO Placement is completed, the number of Equity Shares issued pursuant to the
Pre-IPO Placement will be reduced from the Issue, subject to a minimum Net Issue size of 25% of the post Issue
paid-up equity share capital being offered to the public.

The Issue is being made through the Book Building Process.

Particulars QIBs Non-Institutional Retail Individual Employee Reservation

Bidders Bidders Portion
Number of [●] Equity Shares. Not less than [●] Not less than [●] Equity Up to [●] Equity Shares.
Equity Shares* Equity Shares or Net Shares or Net Issue less
Issue less allocation to allocation to QIB Bidders
QIB Bidders and and Non-Institutional
Retail Individual Bidders shall be available
Bidders shall be for allocation.
available for
allocation.
Percentage of 50% of the Net Issue Not less than 15% of Not less than 35% of the [●] Equity Shares,
Issue available shall be Allotted to QIB the Net Issue or the Net Issue or the Net Issue constituting
for Bidders. Net Issue less less allocation to QIB approximately [●]% of
Allotment/Alloc allocation to QIB Bidders and Non- the Issue.
ation However, 5% of the Net Bidders and Retail Institutional Bidders
QIB Portion shall be Individual Bidders shall be available for
available for allocation shall be available for allocation.
proportionately to allocation.
Mutual Funds only.
Mutual Funds
participating in the 5%
reservation in the Net
QIB Portion will also be
eligible for allocation in
the remaining QIB
Portion. The
unsubscribed portion in
the Mutual Fund
reservation will be
available to QIBs.
Basis of Proportionate as Proportionate. On a proportionate basis Proportionate.
Allotment if follows: subject to Minimum Lot
respective as explained in the
category is (a) [●] Equity Shares section titled “Issue
oversubscribed* shall be available Procedure – Part B –
for allocation on a General Information
proportionate basis Document for Investing
to Mutual Funds; in Public Issues –
and Allotment Procedure and
(b) Equity Shares shall Basis of Allotment” on
be Allotted on a page 411.
proportionate basis
to all QIBs
including Mutual

362
 Particulars QIBs Non-Institutional Retail Individual Employee Reservation
Bidders Bidders Portion
Funds receiving
allocation as per (a)
above.

The Bank, in
consultation with the
Book Running Lead
Managers, may allocate
up to 60% of the QIB
Portion to Anchor
Investors at the Anchor
Investor Allocation
Price on a discretionary
basis, out of which at
least one-third will be
available for allocation
to Mutual Funds only.
Minimum Bid Such number of Equity Such number of [●] Equity Shares. [●] Equity Shares.
Shares so that the Bid Equity Shares so that
Amount exceeds the Bid Amount
` 200,000. exceeds ` 200,000.
Maximum Bid Such number of Equity Such number of Such number of Equity Such number of Equity
Shares not exceeding the Equity Shares not Shares whereby the Bid Shares whereby the Bid
size of the Issue, subject exceeding the size of Amount does not exceed Amount does not exceed
to applicable limits. the Issue, subject to ` 200,000. ` 200,000.
applicable limits.
Mode of Compulsorily in Compulsorily in Compulsorily in Compulsorily in
Allotment dematerialised form. dematerialised form. dematerialised form. dematerialised form.
Bid Lot [●] Equity Shares and in [●] Equity Shares and [●] Equity Shares and in [●] Equity Shares and in
multiples thereof. in multiples thereof. multiples thereof. multiples thereof.
Allotment Lot A minimum of [●] A minimum of [●] A minimum of [●] A minimum of [●]
Equity Shares and Equity Shares and Equity Shares and Equity Shares and
thereafter in multiples of thereafter in multiples thereafter in multiples of thereafter in multiples of
one Equity Share. of one Equity Share. one Equity Share. one Equity Share.
Trading Lot One Equity Share. One Equity Share. One Equity Share. One Equity Share.
Who can Apply Mutual Funds, Venture Eligible NRIs, Resident Indian Eligible Employees
**
Capital Fund, AIFs, Resident Indian individuals (including
FVCI, FPIs (other than individuals, HUFs (in HUFs in the name of the
Category III FPIs) the name of the Karta), Karta) and Eligible NRIs.
public financial companies, corporate
institution as defined in bodies, scientific
Section 2(72) of the institutions, societies
Companies Act, 2013, a and trusts, sub-
scheduled commercial accounts of FIIs
bank, multilateral and registered with SEBI,
bilateral development which are foreign
financial institution, corporates or foreign
state industrial individuals, and
development Category III FPIs.
corporation, insurance
company registered with
the Insurance
Regulatory and
Development Authority,
provident fund with
minimum corpus of
` 250 million, pension
fund with minimum
corpus of ` 250 million,
National Investment

363
 Particulars QIBs Non-Institutional Retail Individual Employee Reservation
Bidders Bidders Portion
Fund, insurance funds
set up and managed by
army, navy or air force
of the Union of India
and insurance funds set
up and managed by the
Department of Posts,
India.
Terms of The entire Bid Amount shall be payable at the time of submission of Bid cum Application Form to the
Payment members of the Syndicate or the Registered Brokers, as the case may be.

In case of ASBA Bidders, the SCSB shall be authorised to block the Bid Amount mentioned in the Bid cum
Application Form.
Mode of Only through the ASBA Only through the Through the ASBA or Through the ASBA or
Bidding process (except Anchor ASBA process. non-ASBA process. non-ASBA process.
Investors).
_______
*
Subject to valid Bids being received at or above the Issue Price. The Issue is being made through the Book Building Process in accordance with
Regulation 26(1) of the SEBI Regulations, wherein 50% of the Net Issue shall be available for allocation on a proportionate basis to Qualified
Institutional Buyers (“QIBs”). Our Bank may, in consultation with the Book Running Lead Managers, allocate up to 60% of the QIB Portion to
Anchor Investors at the Anchor Investor Allocation Price, on a discretionary basis, out of which at least one-third will be available for allocation to
domestic Mutual Funds only. In the event of under-subscription or non-allocation in the Anchor Investor Portion, the balance Equity Shares shall
be added to the Net QIB Portion. Such number of Equity Shares representing 5% of the Net QIB Portion shall be available for allocation on a
proportionate basis to Mutual Funds only. The remainder of the Net QIB Portion shall be available for allocation on a proportionate basis to QIBs,
subject to valid Bids being received from them at or above the Issue Price. However, if the aggregate demand from Mutual Funds is less than 5% of
the Net QIB Portion, the balance Equity Shares available for allocation in the Mutual Fund Portion will be added to the remaining Net QIB Portion
for proportionate allocation to QIBs. Further, not less than 15% of the Net Issue shall be available for allocation on a proportionate basis to Non
Institutional Bidders and not less than 35% of the Net Issue shall be available for allocation to Retail Individual Bidders in accordance with the
SEBI Regulations, subject to valid Bids being received from them at or above the Issue Price.

Subject to valid Bids being received at or above the Issue Price, under-subscription, if any, in the Non-Institutional Portion and Retail Portion
would be allowed to be met with spill-over from other categories at the discretion of our Bank, in consultation with the Book Running Lead
Managers and the Designated Stock Exchange. However, under-subscription, if any, in the QIB Portion will not be allowed to be met with
spill-over from other categories or a combination of categories. Under-subscription, if any, in the Employee Reservation Portion will be added
to the Net Issue. In case of under-subscription in the Net Issue, spill-over to the extent of under-subscription shall be permitted to the
Employee Reservation Portion subject to the Net Issue constituting at least 25% of the fully diluted post-Issue paid up equity share capital of
our Bank.

The QIB Portion includes Anchor Investor Portion, as per the SEBI Regulations. Anchor Investor shall pay the entire Bid Amount at the time
of submission of the Anchor Investor Bid. Provided that any difference between the Anchor Investor Allocation Price and Anchor Investor
Issue Price, shall be payable by Anchor Investor Pay-in Date.
**
In case the Bid cum Application Form is submitted in joint names, the investors should ensure that the demat account is also held in the same
joint names and the names are in the same sequence in which they appear in the Bid cum Application Form .

In case of ASBA Bidders, the SCSB shall be authorised to block such funds in the bank account of the Bidder that are specified in the Bid cum
Application Form.

Bid/Issue Programme*

FOR ALL BIDDERS ISSUE OPENS ON [●]

FOR QIBs** ISSUE CLOSES ON [●]
FOR RETAIL AND NON-INSTITUTIONAL BIDDERS ISSUE CLOSES ON [●]
_______
*
Our Bank may, in consultation with the Book Running Lead Managers, allocate up to 60% of the QIB Portion, i.e. [●] Equity Shares, to Anchor
Investors on a discretionary basis, in accordance with the SEBI Regulations. Anchor Investors shall bid on the Anchor Investor Bidding Period.
**
Our Bank may, in consultation with the BRLMs, consider closing the Bidding Period for QIBs one day prior to the Bid Closing Date in
accordance with the SEBI Regulations

An indicative timetable in respect of the Issue is set out below:

Event Indicative Date

Bid Closing Date [●]

364
 Event Indicative Date
Finalisation of Basis of Allotment with the Designated Stock Exchange [●]
Initiation of refunds [●]
Credit of the Equity Shares to demat accounts of Allottees [●]
Commencement of trading of the Equity Shares on the Stock Exchanges [●]

The above timetable is indicative and does not constitute any obligation on our Bank or the BRLMs. Whilst,
our Bank shall ensure that all steps for the completion of the necessary formalities for the listing and the
commencement of trading of the Equity Shares on the Stock Exchanges are taken within 12 Working Days of
the Bid Closing Date, the timetable may change due to various factors, such as extension of the Bidding
Period by our Bank, revision of the Price Band or any delays in receiving the final listing and trading
approval from the Stock Exchanges. The commencement of trading of the Equity Shares will be entirely at
the discretion of the Stock Exchanges and in accordance with the applicable laws.

Except in relation to the Bids received from the Anchor Investors, Bids and any revision in Bids shall be accepted
only between 10.00 a.m. and 5.00 p.m. (Indian Standard Time) during the Bidding Period (except the Bid Closing
Date) at the Bidding Centres and the Designated Branches as mentioned on the Bid cum Application Form except
that:

(i) in case of Bids by QIBs under the Net QIB Portion, the Bids and the revisions in Bids shall be accepted
only between 10.00 a.m. and 3.00 p.m. (Indian Standard Time) and uploaded until 4.00 p.m. on the QIB
Bid Closing Date;

(ii) in case of Bids by Non-Institutional Bidders, the Bids and the revisions in Bids shall be accepted only
between 10.00 a.m. and 3.00 p.m. (Indian Standard Time) and uploaded until 4.00 p.m. on the Bid Closing
Date; and

(iii) in case of Bids by Retail Individual Bidders or Eligible Employees bidding under the Employee
Reservation Portion, the Bids and the revisions in Bids shall be accepted only between 10.00 a.m. and 3.00
p.m. (Indian Standard Time) and uploaded until 5.00 p.m. on the Bid Closing Date, which may be extended
up to such time as deemed fit by the Stock Exchanges after taking into account the total number of
applications received up to the closure of timings and reported by Book Running Lead Managers to the
Stock Exchanges.

It is clarified that the Bids not uploaded on the online IPO system would be rejected.

Due to limitation of the time available for uploading the Bids on the Bid Closing Date, the Bidders are advised to
submit their Bids one day prior to the Bid Closing Date and, in any case, no later than 1.00 p.m. (Indian Standard
Time) on the Bid Closing Date. Bidders are cautioned that, in the event a large number of Bids are received on the
Bid Closing Date, as is typically experienced in public offerings in India, it may lead to some Bids not being
uploaded due to lack of sufficient time to upload. Such Bids that cannot be uploaded will not be considered for
allocation under this Issue. Bids will only be accepted on Working Days. Investors please note that as per letter no.
List/smd/sm/2006 dated July 3, 2006 and letter no. NSE/IPO/25101- 6 dated July 6, 2006 issued by BSE and NSE
respectively, bids and any revision in Bids shall not be accepted on Saturdays and holidays as declared by the Stock
Exchanges. Bids by ASBA Bidders shall be uploaded by the SCSBs in the electronic system to be provided by the
Stock Exchanges. The Bank or any member of the Syndicate is not liable for any failure in uploading the Bids due to
faults in any software / hardware system or otherwise.

Our Bank, in consultation with the Book Running Lead Managers, reserves the right to revise the Price Band during
the Bidding Period in accordance with the SEBI Regulations. In such an event, the Cap Price shall not be more than
120% of the Floor Price. Subject to compliance with the immediately preceding sentence, the Floor Price can move
up or down to the extent of 20% of the Floor Price, as advertised at least five Working Days before the Bid Opening
Date.

In case of revision in the Price Band, the Bidding Period shall be extended for at least three additional
Working Days after such revision, subject to the total Bidding Period not exceeding 10 Working Days. Any

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revision in the Price Band, and the revised Bidding Period, if applicable, shall be widely disseminated by
notification to the SCSBs and the Stock Exchanges, by issuing a press release and also by indicating the
change on the websites of the Book Running Lead Managers and the terminals of the other members of the
Syndicate.

In case of discrepancy in the data entered in the electronic book vis-à-vis the data contained in the physical Bid cum
Application Form, for a particular Bidder, the details as per the Bid file received from the Stock Exchanges may be
taken as the final data for the purpose of Allotment. In case of discrepancy in the data entered in the electronic book
vis-à-vis the data contained in the physical or electronic Bid cum Application Form, for a particular ASBA Bidder,
the Registrar to the Issue shall ask the relevant SCSB or the member of the Syndicate for rectified data.

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 ISSUE PROCEDURE

All Bidders should review the ‘General Information Document for Investing in Public Issues’ prepared and issued in
accordance with the circular (CIR/CFD/DIL/12/2013) dated October 23, 2013 notified by SEBI (“General
Information Document”) included below under sub-section titled “– Part B – General Information Document”,
which highlights the key rules, processes and procedures applicable to public issues in general in accordance with
the provisions of the Companies Act, the Securities Contracts (Regulation) Act, 1956, the Securities Contracts
(Regulation) Rules, 1957 and the SEBI Regulations. The General Information Document has been updated to
include reference to the Companies Act, 2013, to the extent applicable to a public issue. The General Information
Document is also available on the websites of the Stock Exchanges and the Book Running Lead Managers. Please
refer to the relevant portions of the General Information Document which are applicable to this Issue.

Our Bank and the Syndicate do not accept any responsibility for the completeness and accuracy of the information
stated in this section and the General Information Document. Bidders are advised to make their independent
investigations and ensure that their Bids do not exceed the investment limits or maximum number of Equity Shares
that can be held by them under applicable law or as specified in this Red Herring Prospectus and the Prospectus.

PART A

Book Building Procedure

The Issue is being made through the Book Building Process in accordance with Regulation 26(1) of the SEBI
Regulations, wherein 50% of the Issue shall be available for allocation on a proportionate basis to Qualified
Institutional Buyers (“QIBs”). Our Bank may, in consultation with the Book Running Lead Managers, allocate up to
60% of the QIB Portion to Anchor Investors at the Anchor Investor Allocation Price, on a discretionary basis, out of
which at least one-third will be available for allocation to domestic Mutual Funds only. In the event of under-
subscription or non-allocation in the Anchor Investor Portion, the balance Equity Shares shall be added to the Net QIB
Portion. Such number of Equity Shares representing 5% of the Net QIB Portion shall be available for allocation on a
proportionate basis to Mutual Funds only. The remainder of the Net QIB Portion shall be available for allocation on a
proportionate basis to QIBs (other than Anchor Investors) including Mutual Funds, subject to valid Bids being received
from them at or above the Issue Price. However, if the aggregate demand from Mutual Funds is less than 5% of the Net
QIB Portion, the balance Equity Shares available for allocation in the Mutual Fund Portion will be added to the
remaining Net QIB Portion for proportionate allocation to QIBs. Further, not less than 15% of the Issue shall be
available for allocation on a proportionate basis to Non Institutional Bidders and not less than 35% of the Issue shall be
available for allocation to Retail Individual Bidders in accordance with the SEBI Regulations, subject to valid Bids
being received from them at or above the Issue Price.

In the event of under-subscription in the Retail Portion or the Non-Institutional Portion in the Issue, the
unsubscribed portion would be allowed to be met with spill over from over subscription from any other category or a
combination of categories at the sole discretion of the Bank, in consultation with the Book Running Lead Managers
and the Designated Stock Exchange. However, under-subscription, if any, in the QIB Portion will not be allowed to
be met with spill-over from other categories or a combination of categories. In the event of under-subscription in the
Employee Reservation Portion, the unsubscribed portion shall be added to the Net Issue. In the event of under-
subscription in the Net Issue, spill-over to the extent of under-subscription shall be permitted from the Employee
Reservation Portion to the Net Issue, subject to the Net Issue constituting 25% of the fully diluted post Issue paid up
equity share capital of our Bank.

Investors should note that the Equity Shares will be allotted to all successful Bidders only in dematerialised
form. The Bid-cum-Application Forms which do not have the details of the Bidders’ depository account,
including the DP ID Numbers and the beneficiary account number shall be treated as incomplete and
rejected. Bid-cum-Application Forms which do not have the details of the Bidders’ PAN, (other than Bids
made on behalf of the Central and the State Governments, residents of the state of Sikkim and official
appointed by the courts) shall be treated as incomplete and are liable to be rejected. Bidders will not have the
option of being Allotted Equity Shares in physical form. The Equity Shares on Allotment shall be traded only
in the dematerialised segment of the Stock Exchanges.

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Bid cum Application Form

Please note that there is a common Bid cum Application Form for ASBA Bidders as well as for non-ASBA Bidders.

Retail Individual Bidders can submit their Bids by submitting Bid cum Application Forms, in physical form, to the
members of the Syndicate, the sub-Syndicate or the Registered Brokers.

Bid cum Application Forms for the Retail Individual Bidders, will be available with the Syndicate/ sub-Syndicate
members, SCSBs and at our Registered Office. In addition, the Bid cum Application Forms will also be available for
download on the websites of the Stock Exchanges, NSE (www.nseindia.com) and BSE (www.bseindia.com), at least
one day prior to the Bid Opening Date. Physical Bid cum Application Forms for Anchor Investors shall be made
available at the offices of the BRLMs.

QIBs (other than Anchor Investors) and Non-Institutional Bidders shall mandatorily participate in the Issue only
through the ASBA process. Retail Individual Bidders and Eligible Employees Bidding under the Employee
Reservation Portion can participate in the Issue through the ASBA process as well as the non-ASBA process.
Anchor Investors are not permitted to participate in the Issue through the ASBA process.

ASBA Bidders must provide bank account details in the relevant space provided in the Bid cum Application Form
and the Bid cum Application Form that does not contain such details are liable to be rejected. In relation to non-
ASBA Bidders, the bank account details shall be available from the depository account on the basis of the DP ID,
Client ID and PAN provided by the non-ASBA Bidders in their Bid cum Application Form.

Bidders shall ensure that the Bids are made on Bid cum Application Forms bearing the stamp of a member of the
Syndicate or the Registered Broker or the SCSBs, as the case may be, submitted at the Bidding centres only (except
in case of electronic Bid cum Application Forms) and the Bid cum Application Forms not bearing such specified
stamp are liable to be rejected.

Kindly note that the Syndicate/ sub-Syndicate or the Registered Broker at the Syndicate Bidding Centres or
the Non Syndicate Brokers Centres, as applicable, may not accept the Bid if there is no branch of the Escrow
Collection Banks at that location.

ASBA Bidders can submit their Bids by submitting Bid cum Application Forms, either in physical or electronic
mode, to the SCSB with whom the ASBA Account is maintained or in physical form to the Syndicate, the sub-
Syndicate or the Registered Brokers. The physical Bid cum Application Forms will be available with the Designated
Branches, members of the Syndicate/ sub-Syndicate and at our Registered Office.

Upon acceptance of a Bid cum Application Form, it is the responsibility of the Registered Brokers to comply
with the obligations set out in SEBI circular no. CIR/CFD/14/2012 dated October 4, 2012, including in
relation to uploading the Bids on the online system of the Stock Exchanges, depositing the cheque and sending
the updated electronic schedule to the relevant branch of the Escrow Collection Bank, and are liable for any
failure in this regard.

The prescribed colour of the Bid cum Application Form for various categories of Bidders is as follows:

Category Colour of
Bid cum Application Form*
Resident Indians and Eligible NRIs applying on a non-repatriation basis (ASBA and non [●]
ASBA) **
Non-Residents including Eligible NRIs, FVCIs and FIIs, FPIs and registered multilateral [●]
and bilateral development financial institutions applying on a repatriation basis (ASBA
and non ASBA)**
Anchor Investors*** [●]
Eligible Employees applying under the Employee Reservation Portion**** [●]
_____
*
Excluding electronic Bid cum Application Forms.
**
Bid cum Application forms will also be available on the website of the NSE (www.nseindia.com) and the BSE (www.bseindia.com). Same Bid

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 cum Application Form applies to all ASBA Bids irrespective of whether they are submitted to the SCSBs, to the Registered Brokers, or to the
Syndicate (in Specified Cities).
***
Bid cum Application Forms for Anchor Investors shall be available at the offices of the Book Running Lead Managers.
****
The Bid cum Application Forms for Eligible Employees will be available only at our Registered Office.

Who can Bid?

In addition to the category of Bidders set forth in the sub-section titled “– Part B – General Information Document
for Investing in Public Issues – Category of Investors Eligible to Participate in an Issue” on page 386, the following
persons are also eligible to invest in the Equity Shares under all applicable laws, regulations and guidelines:

 FPIs, other than Category III FPIs;

 Category III FPIs who are foreign corporates or foreign individuals only under the Non-Institutional Portion
 Scientific and/or industrial research organizations in India, which are authorised to invest in equity shares;
and
 Any other persons eligible to Bid in this Issue, under the laws, rules, regulations, guidelines and polices
applicable to them.

Participation by associates and affiliates of the Book Running Lead Managers and the Syndicate Members

The Book Running Lead Managers and the Syndicate Members shall not be allowed to subscribe to this Issue in any
manner, except towards fulfilling their underwriting obligations. However, associates and affiliates of the Book
Running Lead Managers and the Syndicate Members may subscribe to or purchase Equity Shares in the Issue, in the
QIB Portion or in Non-Institutional Portion as may be applicable to such Bidders. Such Bidding and subscription
may be on their own account or on behalf of their clients. All categories of investors, including associates or
affiliates of Book Running Lead Managers and Syndicate Members, shall be treated equally for the purpose of
allocation to be made on a proportionate basis.

Other than Mutual Funds sponsored by entities related to the Book Running Lead Managers, the Book Running
Lead Managers, the Syndicate Members, and any persons related to them cannot apply in the Issue under the Anchor
Investor Portion.

Bids by Mutual Funds

Bids made by asset management companies or custodians of Mutual Funds shall specifically state names of the
concerned schemes for which such Bids are made. In case of a Mutual Fund, a separate Bid can be made in respect
of each scheme of the Mutual Fund registered with SEBI and such Bids in respect of more than one scheme of the
Mutual Fund will not be treated as multiple Bids provided that the Bids clearly indicate the scheme concerned for
which the Bid has been made.

With respect to Bids by Mutual Funds, a certified copy of their SEBI registration certificate must be lodged with the
Bid cum Application Form. Failing this, the Bank reserve the right to accept or reject any Bid in whole or in part, in
either case, without assigning any reason thereof.

No Mutual Fund scheme shall invest more than 10% of its net asset value in the equity shares or equity related
instruments of any single company provided that the limit of 10% shall not be applicable for investments in index
funds or sector or industry specific funds. No Mutual Fund under all its schemes should own more than 10% of any
company’s paid-up share capital carrying voting rights.

Bids by Eligible NRIs

NRIs may obtain copies of Bid cum Application Form from the offices of the BRLMs, the Syndicate Members and
the SCSBs. Only Bids accompanied by payment in Indian Rupees or freely convertible foreign exchange will be
considered for Allotment. Eligible NRIs intending to make payment through freely convertible foreign exchange and
Bidding on a repatriation basis could make payments through Indian Rupee drafts purchased abroad or cheques or
bank drafts for the amount payable on application remitted through normal banking channels or by debits to their
Non-Resident External (“NRE”) or Foreign Currency Non-Resident (“FCNR”) accounts, maintained with banks

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authorised by the RBI to deal in foreign exchange along with documentary evidence in support of the remittance.
Eligible NRIs Bidding on a repatriation basis are advised to use the Bid cum Application Form meant for Non-
Residents, accompanied by a bank certificate confirming that the payment has been made by debiting to the NRE or
FCNR account, as the case may be. Payment for Bids by non-resident Bidder Bidding on a repatriation basis will not
be accepted out of Non-Resident Ordinary (“NRO”) accounts. NRIs Bidding on non-repatriation basis are advised
to use the Bid cum Application Form for residents (white in colour). Payment by drafts should be accompanied by a
bank certificate confirming that the draft has been issued by debiting an NRE or FCNR or NRO Account.

Non ASBA Bids by NRIs shall be submitted only in the locations specified in the Bid cum Application Form.

Bids by FIIs and FPIs

On January 7, 2014, SEBI notified the Securities and Exchange Board of India (Foreign Portfolio Investors)
Regulations, 2014 (“SEBI FPI Regulations”) pursuant to which the existing classes of portfolio investors namely
FIIs and qualified foreign investors were subsumed under a new category namely ‘foreign portfolio investors’ or
‘FPIs’. Furthermore, RBI on March 13, 2014 amended the FEMA Regulations and laid down conditions and
requirements with respect to investment by FPIs in Indian companies.

In terms of the SEBI FPI Regulations, an FII who holds a valid certificate of registration from SEBI shall be deemed
to be a registered FPI until the expiry of the block of three years for which fees have been paid as per the SEBI FII
Regulations. Accordingly, such FIIs can participate in this Issue in accordance with Schedule 2 of the FEMA
Regulations. An FII shall not be eligible to invest as an FII after registering as an FPI under the SEBI FPI
Regulations. Further, a qualified foreign investor who had not obtained a certificate of registration as an FPI could
only continue to buy, sell or otherwise deal in securities until January 6, 2015. Hence, such qualified foreign
investors who have not registered as FPIs under the SEBI FPI Regulations shall not be eligible to participate in this
Issue.

In terms of the SEBI FPI Regulations, the issue of Equity Shares to a single FPI or an investor group (which means
the same set of ultimate beneficial owner(s) investing through multiple entities) is not permitted to exceed 10% of
our post-Issue Equity Share capital. Further, in terms of the FEMA Regulations, the total holding by each FPI shall
be below 10% of the total paid-up Equity Share capital of our Bank and the total holdings of all FPIs put together
shall not exceed 24% of the paid-up Equity Share capital of our Bank. The aggregate limit of 24% may be increased
up to the sectoral cap by way of a resolution passed by our Board, followed by a special resolution passed by the
shareholders of our Bank and subject to prior intimation to RBI. In terms of the FEMA Regulations, for calculating
the aggregate holding of FPIs in a company, holding of all registered FPIs as well as holding of FIIs (being deemed
FPIs) shall be included. We have, subject to requisite approval from the FIPB, pursuant to shareholders resolution
dated February 19, 2014, increased the limit for FIIs and FPIs to 49% and for NRIs to 24%, of our paid up equity
share capital.

Further, the existing individual and aggregate investment limits for QFIs in an Indian company are 5% and 10% of
the paid up capital of an Indian company, respectively. FPIs are permitted to participate in the Issue subject to
compliance with conditions and restrictions which may be specified by the Government from time to time.

As per the circular issued by SEBI on November 24, 2014, these investment restrictions shall also apply to
subscribers of offshore derivative instruments (“ODIs”). Two or more subscribers of ODIs having a common
beneficial owner shall be considered together as a single subscriber of the ODI. In the event an investor has
investments as a FPI and as a subscriber of ODIs, these investment restrictions shall apply on the aggregate of the
FPI and ODI investments held in the underlying company. FPIs are permitted to participate in the Issue subject to
compliance with conditions and restrictions which may be specified by the GoI from time to time.

An FPI shall issue ODIs only to those subscribers which meet the eligibility criteria as laid down in Regulation 4 of
the SEBI FPI Regulations. Subject to compliance with all applicable Indian laws, rules, regulations, guidelines and
approvals in terms of Regulation 22 of the SEBI FPI Regulations, an FPI, other than Category III FPI and
unregulated broad based funds, which are classified as Category II FPIs by virtue of their investment manager being
appropriately regulated, may issue or otherwise deal in offshore derivative instruments (as defined under the SEBI
FPI Regulations as any instrument, by whatever name called, which is issued overseas by a FPI against securities

370
held by it that are listed or proposed to be listed on any recognised stock exchange in India, as its underlying)
directly or indirectly, only in the event (i) such offshore derivative instruments are issued only to persons who are
regulated by an appropriate regulatory authority; and (ii) such offshore derivative instruments are issued after
compliance with ‘know your client’ norms. An FPI is also required to ensure that no further issue or transfer of any
offshore derivative instrument is made by or on behalf of it to any persons that are not regulated by an appropriate
foreign regulatory authority.

Bids by SEBI registered Venture Capital Funds, Alternative Investment Funds and Foreign Venture Capital
Investors

The Securities and Exchange Board of India (Venture Capital Funds) Regulations, 1996 as amended, (the “SEBI
VCF Regulations”) and the Securities and Exchange Board of India (Foreign Venture Capital Investor)
Regulations, 2000, as amended, inter alia prescribe the investment restrictions on VCFs and FVCIs, respectively,
registered with SEBI. Further, the SEBI AIF Regulations prescribe, amongst others, the investment restrictions on
AIFs.

Accordingly, the holding in any company by any individual VCF or FVCI registered with SEBI should not exceed
25% of the corpus of the VCF or FVCI. Further, VCFs and FVCIs can invest only up to 33.33% of the investible
funds in various prescribed instruments, including in public offerings.

The category I and II AIFs cannot invest more than 25% of the corpus in one investee company. A category III AIF
cannot invest more than 10% of the corpus in one investee company. A venture capital fund registered as a category
I AIF, as defined in the SEBI AIF Regulations, cannot invest more than 1/3 rd of its corpus by way of subscription to
an initial public offering of a venture capital undertaking. Additionally, the VCFs which have not re-registered as an
AIF under the SEBI AIF Regulations shall continue to be regulated by the VCF Regulations.

All Non-Resident Bidders including Eligible NRIs, FIIs and FVCIs should note that refunds, dividends and other
distributions, if any, will be payable in Indian Rupees only and net of bank charges and / or commission. There is no
reservation for Eligible NRIs, FIIs and FVCIs and all Bidders will be treated on the same basis with other categories
for the purpose of allocation.

Further, according to the SEBI Regulations, the shareholding of VCFs, category I AIFs and FVCIs held in a
company prior to making an initial public offering would be exempt from lock-in requirements only if the shares
have been held by them for at least one year prior to the time of filing this Draft Red Herring Prospectus with SEBI.

Bids by Eligible Employees

Bids under the Employee Reservation Portion shall be subject to the following:

 Only Eligible Employees would be eligible to apply in this Issue under the Employee Reservation Portion.
 The sole/ First Bidder shall be an Eligible Employee.
 Bid shall be made only in the prescribed Bid cum Application Form or Revision Form.
 Only those Bids, which are received at or above the Issue Price, would be considered for allocation under
this category.
 Eligible Employees may Bid in any of the bidding options at Cut-Off Price.
 The maximum Bid amount by any Eligible Employee cannot exceed ` 200,000.
 The value of Allotment to any Eligible Employee shall not exceed ` 200,000.
 The Bids must be for a minimum of [●] Equity Shares and in multiples of [●] Equity Shares thereafter.
 Bid by an Eligible Employee can be made also in the Net Issue portion and such Bids shall not be treated as
multiple Bids.
 If the aggregate demand in this category is less than or equal to [●] Equity Shares at or above the Issue
Price, full allocation shall be made to the Eligible Employees to the extent of their demand.
 Under-subscription, if any, in the Employee Reservation Portion will be added to the Net Issue. In the event
of under-subscription in the Net Issue, spill-over to the extent of under-subscription shall be permitted from
the Employee Reservation Portion to the Net Issue, subject to the Net Issue constituting 25% of the fully

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 diluted post-Issue paid up equity share capital of our Bank.

If the aggregate demand in this category is greater than [●] Equity Shares at or above the Issue Price, the allocation
shall be made on a proportionate basis. For the method of proportionate basis of Allotment, please see the section
titled “Issue Procedure – Allotment Procedure and Basis of Allotment” on page 411.

Bids by limited liability partnerships

In case of Bids made by limited liability partnerships registered under the Limited Liability Partnership Act, 2008, a
certified copy of certificate of registration issued under the Limited Liability Partnership Act, 2008, must be
attached to the Bid cum Application Form. Failing this, the Bank reserve the right to reject any Bid without
assigning any reason thereof.

Bids by insurance companies

In case of Bids made by insurance companies registered with the IRDA, a certified copy of certificate of registration
issued by IRDA must be attached to the Bid cum Application Form. Failing this, the Bank reserves the right to reject
any Bid without assigning any reason thereof.

The exposure norms for insurers is prescribed in Regulation 9 of the Insurance Regulatory and Development
Authority (Investment) Regulations, 2000 (the “IRDA Investment Regulations”) are set forth below:

(a) equity shares of a company: the least of 10% of the investee company’s subscribed capital (face value) or
10% of the respective fund in case of life insurer or 10% of investment assets in case of general insurer or
reinsurer;

(b) the entire group of the investee company: the least of 10% of the respective fund in case of a life insurer or
10% of investment assets in case of a general insurer or reinsurer (25% in case of ULIPs); and

(c) the industry sector in which the investee company operates: 10% of the insurer’s total investment exposure to
the industry sector (25% in case of ULIPs).

Bids by provident funds/ pension funds

In case of Bids made by provident funds/pension funds, subject to applicable laws, with minimum corpus of
` 250 million, a certified copy of certificate from a chartered accountant certifying the corpus of the provident fund/
pension fund must be attached to the Bid cum Application Form. Failing this, the Bank reserves the right to reject
any Bid, without assigning any reason thereof.

Bids by Banking Companies

In case of Bids made by banking companies registered with RBI, certified copies of: (i) the certificate of registration
issued by RBI, and (ii) the approval of such banking company’s investment committee are required to be attached to
the Bid cum Application Form, failing which our Bank reserves the right to reject any Bid without assigning any
reason.

The investment limit for banking companies in non-financial services companies as per the Banking Regulation Act,
1949, as amended (the “Banking Regulation Act”), and the Master Circular dated July 1, 2014 – Para-banking
Activities, is 10% of the paid-up share capital of the investee company or 10% of the banks’ own paid-up share
capital and reserves, whichever is less. Further, the investment in a non-financial services company by a banking
company together with its subsidiaries, associates, joint ventures, entities directly or indirectly controlled by the
bank and mutual funds managed by asset management companies controlled by the banking company cannot exceed
20% of the investee company’s paid-up share capital. A banking company may hold up to 30% of the paid-up share
capital of the investee company with the prior approval of the RBI provided that the investee company is engaged in
non-financial activities in which banking companies are permitted to engage under the Banking Regulation Act.

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Bids by SCSBs

SCSBs participating in the Issue are required to comply with the terms of the SEBI circulars dated September 13,
2012 and January 2, 2013. Such SCSBs are required to ensure that for making applications on their own account
using ASBA, they should have a separate account in their own name with any other SEBI registered SCSBs.
Further, such account shall be used solely for the purpose of making application in public issues and clear
demarcated funds should be available in such account for ASBA applications.

Bids under Power of Attorney

In case of Bids made pursuant to a power of attorney by limited companies, corporate bodies, registered societies,
FIIs, FPIs, AIFs, Mutual Funds, insurance companies, insurance funds set up by the army, navy or air force of the
Union of India, insurance funds set up by the Department of Posts, India or the National Investment Fund, provident
funds with minimum corpus of ` 250 million and pension funds with a minimum corpus of ` 250 million (in each
case, subject to applicable law and in accordance with their respective constitutional documents), a certified copy of
the power of attorney or the relevant resolution or authority, as the case may be, with a certified copy of the
memorandum of association and articles of association and/or bye laws, as applicable, must be lodged with the Bid
cum Application Form. Failing this, the Bank reserves the right to accept or reject any Bid in whole or in part, in
either case, without assigning any reason.

The Bank, in its absolute discretion, reserves the right to relax the above condition of simultaneous lodging of the
power of attorney with the Bid cum Application Form, subject to such terms and conditions that the Bank and the
Book Running Lead Managers deem fit, without assigning any reasons therefore.

The above information is given for the benefit of the Bidders. Our Bank and the BRLMs are not liable for
any amendments or modification or changes in applicable laws or regulations, which may occur after the date
of this Draft Red Herring Prospectus. Bidders are advised to make their independent investigations and
ensure that any single Bid from them does not exceed the applicable investment limits or maximum number
of the Equity Shares that can be held by them under applicable law or regulation or as specified in the Draft
Red Herring Prospectus.

Pre-Issue Advertisement

Subject to Section 30 of the Companies Act, 2013 the Bank shall, after registering the Red Herring Prospectus with
the RoC, publish a pre-Issue advertisement, in one English national newspaper, a Hindi national daily newspaper
and a Malayalam newspaper, each with wide circulation. In the pre-Issue advertisement, we shall state the Bid
Opening Date, the Bid Closing Date and the QIB Bid Closing Date. This advertisement, subject to the provisions of
Section 30 of the Companies Act, 2013, shall be in the format prescribed in Part A of Schedule XIII of the SEBI
Regulations.

Information for Bidders

In addition to the instructions provided to Bidders set forth in the sub-section titled “– Part B – General Information
Document for Investing in Public Issues” on page 383, Bidders are requested to note the following additional
information in relation to the Issue.

1. The Bank shall dispatch the Red Herring Prospectus and other Issue material including Bid cum
Application Forms, to the Designated Stock Exchange, Syndicate/ sub-Syndicate, Bankers to the Issue,
investors’ associations and SCSBs in advance.

2. The Price Band and the minimum Bid Lot for the Issue will be decided by the Bank, in consultation the
Book Running Lead Managers, and advertised in an English national daily newspaper, a Hindi national
daily newspaper and a Malayalam newspaper, each with wide circulation at least five Working Days prior
to the Bid Opening Date, with the relevant financial ratios calculated at the Floor Price and at the Cap
Price. Such information shall also be disclosed to the Stock Exchanges for dissemination through, and shall
be pre-filled in the Bid cum Application Forms available on, the Stock Exchanges’ websites.

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3. It is not obligatory for the Registered Brokers to accept the Bid cum Application Forms. However, upon
acceptance of a Bid cum Application Form, it is the responsibility of the Registered Brokers to comply with
the obligations set out in SEBI circular no. CIR/CFD/14/2012 dated October 4, 2012, including in relation
to uploading the Bids on the online system of the Stock Exchanges, depositing the cheque and sending the
updated electronic schedule to the relevant branch of the Escrow Collection Bank (in case of Bids by
Bidders other than ASBA Bidders) and forwarding the schedule along with the Bid cum Application
Form to the relevant branch of the SCSB (in case of Bids by ASBA Bidders), and are liable for any failure
in this regard.

In case of Bid cum Application Form by non ASBA Bidders, Registered Brokers shall deposit the cheque,
prepare electronic schedule and send it to Escrow Collection Banks. All Escrow Collection Banks, which
have branches in a Registered Broker Centre, shall ensure that at least one of its branches in the Registered
Broker Centre accepts cheques. Registered Brokers shall deposit the cheque in any of the bank branch of
the Escrow Collection Banks in the Registered Broker Centre. Registered Brokers shall also update the
electronic schedule (containing application details including the application amount) as downloaded from
Stock Exchange platform and send it to local branch of the Escrow Collection Banks. Registered Brokers
shall retain all physical Bid cum Application Forms and send it to the Registrar to Issue after six months.

4. In case of Bid cum Application Forms submitted by ASBA Bidders, Registered Brokers shall forward a
schedule (containing application number and amount) along with the Bid cum Application Forms to the
branch where the ASBA Account is maintained of the relevant SCSB for blocking of fund.

5. The Syndicate/ sub-Syndicate, the SCSBs and the Registered Brokers, as the case may be, will enter each
Bid option into the electronic Bidding system as a separate Bid and generate a Transaction Registration
Slip, (“TRS”), for each price and demand option and give the same to the Bidder. Therefore, a Bidder can
receive up to three TRSs for each Bid cum Application Form. All accepted Bids made at the Registered
Broker Centre shall be stamped and thereby acknowledged by the Registered Brokers at the time of receipt,
which shall form the basis of any complaint. It is the Bidder’s responsibility to obtain the TRS from the
Syndicate/ sub-Syndicate, the Designated Branches or Registered Brokers. The registration of the Bid by
the Syndicate/ sub-Syndicate, the Designated Branches or Registered Brokers does not guarantee that the
Equity Shares shall be allocated/ Allotted by the Bank. Such TRS will be non-negotiable and by itself will
not create any obligation of any kind. When a Bidder revises his or her Bid, he /she shall surrender the
earlier TRS and may request for a revised TRS from the Syndicate/ sub-Syndicate, the Registered Brokers
or the SCSB as proof of his or her having revised the previous Bid.

6. The Bank, in consultation with the Book Running Lead Managers, will finalise the Issue Price within the
Price Band, without the prior approval of or intimation to the Bidders.

7. In relation to electronic registration of bids, the permission given by the Stock Exchanges to use their
network and software of the electronic bidding system should not in any way be deemed or construed to
mean that the compliance with various statutory and other requirements by the Bank, and/or the Book
Running Lead Managers are cleared or approved by the Stock Exchanges; nor does it in any manner
warrant, certify or endorse the correctness or completeness of any of the compliance with the statutory and
other requirements nor does it take any responsibility for the financial or other soundness of the Bank, the
management or any scheme or project of the Bank; nor does it in any manner warrant, certify or endorse
the correctness or completeness of any of the contents of the Red Herring Prospectus; nor does it warrant
that the Equity Shares will be listed or will continue to be listed on the Stock Exchanges.

8. In case of an upward revision in the Price Band, Retail Individual Bidders who had Bid at Cut-off Price
could either (i) revise their Bid or (ii) shall make additional payment based on the cap of the revised Price
Band (such that the total amount i.e., original Bid Amount plus additional payment does not exceed `
200,000 if the Bidder wants to continue to Bid at Cut-off Price). The revised Bids must be submitted by the
ASBA Bidders to SCSB or to the Syndicate (in specified cities) to whom the original Bid was submitted. In
case the total amount (i.e., original Bid Amount plus additional payment) exceeds ` 200,000, the Bid will

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 be considered for allocation under the Non-Institutional Portion in terms of this Red Herring Prospectus if
the Bid was made through ASBA. If, however, the Retail Individual Bidder does not either revise the Bid
or make additional payment and the Issue Price is higher than the cap of the Price Band prior to revision,
the number of Equity Shares Bid for shall be adjusted downwards for the purpose of allocation, such that
no additional payment would be required from the Retail Individual Bidder and the Retail Individual
Bidder is deemed to have approved such revised Bid at Cut-off Price.

9. In case of a downward revision in the Price Band, Retail Individual Bidders who have bid at Cut-off Price
could either revise their Bid or the excess amount paid at the time of Bidding would be refunded from the
Escrow Account or unblocked, in case of ASBA Bidders.

10. Any revision of the Bid shall be accompanied by payment in the form of cheque or demand draft for the
incremental amount, if any, to be paid on account of the upward revision of the Bid. With respect to the
ASBA Bids, if revision of the Bids results in an incremental amount, the SCSBs shall block the additional
Bid Amount. In case of Bids, other than ASBA Bids, the Syndicate/ sub-Syndicate or the Registered
Brokers, as the case may be, shall collect the payment in the form of cheque or demand draft if any, to be
paid on account of the upward revision of the Bid at the time of one or more revisions.

11. Allocation to Non-Residents, including Eligible NRIs FIIs and FPIs will be subject to applicable law, rules,
regulations, guidelines and approvals.

12. The Allotment and trading of the Equity Shares would be in dematerialised form only for all investors in
the demat segment of the respective Stock Exchanges.

In addition to the information provided in the sub-section titled “Part B – General Information Document for
Investing in Public Issues – Interest and Refunds - Mode of making refunds for Bidders/Applicants other than ASBA
Bidders/Applicants” on page 416, Bidders are requested to note that refunds, on account of our Bank not receiving
the minimum subscription of 90% of the Issue shall be credited only to the bank account from which the Bid
Amount was remitted to the Escrow Bank.

Signing of the Underwriting Agreement and the RoC Filing

The Bank, the Registrar to the Issue and the Underwriters intend to enter into an Underwriting Agreement on or
immediately after the finalisation of the Issue Price. After signing the Underwriting Agreement, the Bank will file
the Prospectus with the RoC. The Prospectus would have details of the Issue Price, Anchor Investor Issue Price,
Issue size and underwriting arrangements and would be complete in all material respects.

GENERAL INSTRUCTIONS

In addition to the general instructions provided in the sub-section titled “Part B – General Information Document for
Investing in Public Issues” on page 383, Bidders are requested to note the additional instructions provided below.

Do’s:

1. Check if you are eligible to apply as per the terms of the Red Herring Prospectus and under applicable law;

2. Ensure that you have Bid within the Price Band;

3. Read all the instructions carefully and complete the Bid cum Application Form in the prescribed form;

4. Ensure that the details about the PAN, DP ID and Client ID are correct and the Bidders depository account
is active, as Allotment of the Equity Shares will be in the dematerialised form only;

5. Ensure that the Bids are submitted at the bidding centres only on forms bearing the stamp of the Syndicate
or Registered Broker or SCSB (except in case of electronic forms).

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6. In relation to the ASBA Bids, ensure that your Bid cum Application Form is submitted either at a
Designated Branch of a SCSB where the ASBA Account is maintained or with the Syndicate in the
Specified Locations or with a Registered Broker at the Broker Centres, and not to the Escrow Collecting
Banks (assuming that such bank is not a SCSB) or to our Bank or the Registrar to the Issue;

7. With respect to the ASBA Bids, ensure that the Bid cum Application Form is signed by the account holder
in case the applicant is not the account holder. Ensure that you have mentioned the correct bank account
number in the Bid cum Application Form;

8. QIBs (other than Anchor Investors) and the Non-Institutional Bidders should submit their Bids through the
ASBA process only;

9. With respect to Bids by SCSBs, ensure that you have a separate account in your own name with any other
SCSB having clear demarcated funds for applying under the ASBA process and that such separate account
(with any other SCSB) is used as the ASBA Account with respect to your Bid;

10. Ensure that you request for and receive a TRS for all your Bid options;

11. Ensure that you have funds equal to the Bid Amount in the ASBA Account maintained with the SCSB
before submitting the Bid cum Application Form under the ASBA process to the respective member of the
Syndicate (in the Specified Locations), the SCSBs or the Registered Broker (at the Broker Centres);

12. Ensure that you have funds equal to the Bid Amount in your bank account before submitting the Bid cum
Application Form under non-ASBA process to the Syndicate or the Registered Brokers;

13. With respect to non-ASBA Bids, ensure that the full Bid Amount is paid for the Bids and with respect to
ASBA Bids, ensure funds equivalent to the Bid Amount are blocked;

14. Ensure that you tick the correct investor category, as applicable, in the Bid cum Application Form to ensure
proper upload of your Bid in the online IPO system of the Stock Exchanges;

15. Instruct your respective banks to not release the funds blocked in the ASBA Account under the ASBA
process;

16. Submit revised Bids to the same member of the Syndicate, SCSB or Registered Broker, as applicable,
through whom the original Bid was placed and obtain a revised TRS;

17. Except for Bids (i) on behalf of the Central or State Governments and the officials appointed by the courts,
who, in terms of a SEBI circular dated June 30, 2008, may be exempt from specifying their PAN for
transacting in the securities market, and (ii) Bids by persons resident in the state of Sikkim, who, in terms
of a SEBI circular dated July 20, 2006, may be exempted from specifying their PAN for transacting in the
securities market, all Bidders should mention their PAN allotted under the IT Act. The exemption for the
Central or the State Government and officials appointed by the courts and for investors residing in the State
of Sikkim is subject to (a) the demographic details received from the respective depositories confirming the
exemption granted to the beneficiary owner by a suitable description in the PAN field and the beneficiary
account remaining in “active status”; and (b) in the case of residents of Sikkim, the address as per the
demographic details evidencing the same;

18. Ensure that the Demographic Details (as defined herein below) are updated, true and correct in all respects;

19. Ensure that thumb impressions and signatures other than in the languages specified in the Eighth Schedule
to the Constitution of India are attested by a Magistrate or a Notary Public or a Special Executive
Magistrate under official seal.

20. Ensure that the signature of the First Bidder in case of joint Bids, is included in the Bid cum Application
Forms.

21. Ensure that the name(s) given in the Bid cum Application Form is/are exactly the same as the name(s) in

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 which the beneficiary account is held with the Depository Participant. In case of joint Bids, the Bid cum
Application Form should contain only the name of the First Bidder whose name should also appear as the
first holder of the beneficiary account held in joint names;

22. Ensure that the category and sub-category is indicated;

23. Ensure that in case of Bids under power of attorney or by limited companies, corporate, trust etc., relevant
documents are submitted;

24. Ensure that Bids submitted by any person outside India should be in compliance with applicable foreign
and Indian laws;

25. Ensure that the DP ID, the Client ID and the PAN mentioned in the Bid cum Application Form and entered
into the online IPO system of the stock exchanges by the Syndicate, the SCSBs or the Registered Brokers,
as the case may be, match with the DP ID, Client ID and PAN available in the Depository database;

26. In relation to the ASBA Bids, ensure that you use the Bid cum Application Form bearing the stamp of the
Syndicate (in the Specified Locations) and/or relevant SCSB and/ or the Designated Branch and/ or the
Registered Broker at the Broker Centres (except in case of electronic forms);

27. Ensure that the Bid cum Application Forms are delivered by the Bidders within the time prescribed as per
the Bid cum Application Form and the Red Herring Prospectus;

28. ASBA Bidders bidding through a member of the Syndicate should ensure that the Bid cum Application
Form is submitted to a member of the Syndicate only in the Specified Locations and that the SCSB where
the ASBA Account, as specified in the Bid cum Application Form, is maintained has named at least one
branch at that location for the Syndicate to deposit Bid cum Application Forms (a list of such branches is
available on the website of SEBI at http://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/ Recognised-
Intermediaries, updated from time to time(a list of such branches is available on the website of SEBI at
http://www.sebi.gov.in). ASBA Bidders bidding through a Registered Broker should ensure that the SCSB
where the ASBA Account, as specified in the Bid cum Application Form, is maintained has named at least
one branch at that location for the Registered Brokers to deposit Bid cum Application Forms;

29. Ensure that you have mentioned the correct ASBA Account number in the Bid cum Application Form;

30. In relation to the ASBA Bids, ensure that you have correctly signed the authorization/undertaking box in
the Bid cum Application Form, or have otherwise provided an authorisation to the SCSB via the electronic
mode, for blocking funds in the ASBA Account equivalent to the Bid Amount mentioned in the Bid cum
Application Form; and

31. In relation to the ASBA Bids, ensure that you receive an acknowledgement from the Designated Branch of
the SCSB or from the member of the Syndicate in the Specified Locations or from the Registered Broker at
the Broker Centres, as the case may be, for the submission of your Bid cum Application Form.

The Bid cum Application Form is liable to be rejected if the above instructions, as applicable, are not complied with.

Don’ts:

1. Do not Bid for lower than the minimum Bid size;

2. Do not Bid/revise Bid Amount to less than the Floor Price or higher than the Cap Price;

3. Do not Bid on another Bid cum Application Form after you have submitted a Bid to the Syndicate, the
SCSBs or the Registered Brokers, as applicable;

4. If you are an ASBA Bidder, do not make payment of the Bid Amount in any mode other than blocked
amounts in the bank account maintained with an SCSB;

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5. Do not pay the Bid Amount in cash, by money order or by postal order or by stockinvest;

6. Do not send Bid cum Application Forms by post; Instead submit the same with a Designated Branch of the
SCSBs, Syndicate/ sub-Syndicate the Registered Brokers, as the case may be;

7. Do not submit the Bid cum Application Forms to the Escrow Collection Bank(s) (assuming that such bank
is not a SCSB), our Bank or the Registrar to the Issue;

8. Do not Bid on a physical Bid cum Application Form that does not have the stamp of the Syndicate, the
Registered Brokers or the SCSBs;

9. Anchor Investors should not Bid through the ASBA process;

10. Do not Bid at Cut-off Price (for Bids by QIBs and Non-Institutional Bidders);

11. Do not Bid for a Bid Amount exceeding ` 200,000 (for Bids by Retail Individual Bidders and Eligible
Employees Bidding under the Employee Reservation Portion);

12. In case you are an ASBA Bidder, do not instruct your respective banks to release the funds blocked in the
ASBA Account;

13. In case you are a Bidder other than an ASBA Bidder, do not submit the Bid without payment of the entire
Bid Amount. In case you are an ASBA Bidder, do not submit the Bid without ensuring that funds
equivalent to the entire Bid Amount are blocked in the relevant ASBA Account;

14. Do not fill up the Bid cum Application Form such that the Equity Shares Bid for exceeds the Issue size and/
or investment limit or maximum number of the Equity Shares that can be held under the applicable laws or
regulations or maximum amount permissible under the applicable regulations;

15. Do not submit the GIR number instead of the PAN;

16. Do not submit the Bids without the full Bid Amount;

17. Do not submit incorrect details of the DP ID, Client ID and PAN or provide details for a beneficiary
account which is suspended or for which details cannot be verified by the Registrar to the Issue;

18. Do not submit Bids on plain paper or on incomplete or illegible Bid cum Application Forms or on Bid cum
Application Forms in a colour prescribed for another category of Bidder;

19. If you are a QIB, do not submit your Bid after 3.00 p.m. on the Bid Closing Date for QIBs;

20. If you are a Non-Institutional Bidder or Retail Individual Bidder, do not submit your Bid after 3.00 p.m. on
the Bid Closing Date;

21. Do not Bid if you are not competent to contract under the Indian Contract Act, 1872, other than Bids
belonging to an account for the benefit of a minor (under guardianship);

22. Do not withdraw your Bid or lower the size of your Bid (in terms of quantity of the Equity Shares or the
Bid Amount) at any stage, if you are a QIB or a Non-Institutional Investor;

23. Do not submit more than five Bid cum Application Forms per ASBA Account;

24. Do not submit ASBA Bids to a member of the Syndicate at a location other than the Specified Locations or
to the brokers other than the Registered Brokers at a location other than the Broker Centres;

25. Do not submit ASBA Bids to a member of the Syndicate in the Specified Locations unless the SCSB where
the ASBA Account is maintained, as specified in the Bid cum Application Form, has named at least one
branch in the relevant Specified Location, for the Syndicate to deposit Bid cum Application Forms (a list of

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 such branches is available on the website of SEBI at http://www.sebi.gov.in); and

26. Do not submit ASBA Bids to a Registered Broker unless the SCSB where the ASBA Account is
maintained, as specified in the Bid cum Application Form, has named at least one branch in that location
for the Registered Broker to deposit the Bid cum Application Forms.

The Bid cum Application Form is liable to be rejected if the above instructions, as applicable, are not complied with.

INSTRUCTIONS FOR COMPLETING THE BID CUM APPLICATION FORM

In addition to the instructions for completing the Bid cum Application Form provided in the sub-section titled “Part
B – General Information Document for Investing in Public Issues – Applying in the Issue – Instructions for filing the
Bid cum Application Form/ Application Form” on page 387, Bidders are requested to note the additional instructions
provided below.

1. Thumb impressions and signatures other than in the languages specified in the Eighth Schedule in the
Constitution of India must be attested by a Magistrate or a Notary Public or a Special Executive Magistrate
under official seal. Bids must be in single name or in joint names (not more than three, and in the same order
as their Depository Participant details).

2. Bids through ASBA must be made in single name or in joint names (not more than three, and in the same
order as their details appear with the Depository Participant), and completed in full, in BLOCK LETTERS in
ENGLISH and in accordance with the instructions contained in this Red Herring Prospectus and in the Bid
cum Application Form.

3. Bids on a repatriation basis shall be in the names of individuals, or in the name of Eligible NRIs, FIIs, FPIs,
but not in the names of minors, OCBs, firms or partnerships, foreign nationals (excluding NRIs) or their
nominees. Bids by Eligible NRIs for a Bid Amount of up to ` 200,000 would be considered under the Retail
Portion for the purposes of allocation and Bids for a Bid Amount of more than ` 200,000 would be
considered under Non-Institutional Portion for the purposes of allocation.

Escrow mechanism for non-ASBA Bidders

In addition to the payment instructions for non-ASBA Bidders as provided in the sub-section titled “Part B –
General Information Document for Investing in Public Issues – Applying in the Issue – Payment Details –
Instructions for non-ASBA Applicants” on page 404, non-ASBA Bidders are requested to note the following.

1. The payment instruments for payment into the Escrow Account should be drawn in favour of:

 In case of resident Retail Individual Bidders: “[●]”;

 In case of Non-Resident Retail Individual Bidders: “[●]”; and
 Our Bank in consultation with the BRLMs, in its absolute discretion, will decide the list of Anchor
Investors to whom the Allotment Advice will be sent, pursuant to which the details of the Equity Shares
allocated to them in their respective names will be notified to such Anchor Investors. For Anchor
Investors, be drawn in the payment instruments for payment into the Escrow Account should favour of -
“[●]” for resident Anchor Investors, and “[●]” for Non Resident Anchor Investors.
 In case of Eligible Employees: “Escrow Account – [●] – Eligible Employees - R”.

2. Payments should be made by cheque, or demand draft drawn on any bank (including a co-operative bank),
which is situated at, and is a member of or sub-member of the bankers’ clearing house located at the centre
where the Bid cum Application Form is submitted. Outstation cheques/bank drafts drawn on banks not
participating in the clearing process will not be accepted and applications accompanied by such cheques or
bank drafts will be rejected. Please note that cheques without the nine digit Magnetic Ink Character
Recognition (“MICR”) code are liable to be rejected.

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3. Bidders should note that the escrow mechanism is not prescribed by SEBI and has been established as
an arrangement between the Bank, the Syndicate, the Escrow Collection Banks and the Registrar to
the Issue to facilitate collections from the Bidders.

Designated Date and Allotment

(a) Our Bank will ensure that the Allotment and credit to the successful Bidder’s depositary account will be
completed within 12 Working Days of the Bid Closing Date.

(b) Equity Shares will be issued and Allotment shall be made only in the dematerialised form to the Allottees.

(c) Allottees will have the option to re-materialise the Equity Shares so Allotted as per the provisions of the
Companies Act, 2013 and the Depositories Act.

Grounds for Technical Rejections

In addition to the grounds for rejection of Bids on technical grounds as provided in the sub-section titled “Part B –
General Information Document for Investing in Public Issues – Issue Procedure in Book Built Issue – Rejection and
Responsibility for Upload of Bids – Grounds for Technical Rejections” on page 408, Bidders are requested to note
that Bids may be rejected on the following additional technical grounds.

1. Bid submitted without payment of the entire Bid Amount;

2. Bids submitted by Retail Individual Bidders which do not contain details of the Bid Amount and the bank
account details in the Bid cum Application Form;
3. Bids submitted on a plain paper;
4. Bids by HUFs not mentioned correctly as given in the sub-section titled “ – Who can Bid?” on page 369;
5. Bid cum Application Form submitted to the Book Running Lead Managers does not bear the stamp of the
Book Running Lead Managers or the Registered Brokers;
6. ASBA Bids submitted directly to the SCSBs does not bear the stamp of the SCSB and/or the Designated
Branch and/or the Book Running Lead Managers, as the case may be;
7. Signature of First/sole Bidder missing;
8. With respect to ASBA Bids, the Bid cum Application Form not being signed by the account holders, if the
account holder is different from the Bidder;
9. Bids by persons for whom PAN details have not been verified and whose beneficiary accounts are
‘suspended for credit‘ in terms of SEBI circular (reference number: CIR/MRD/DP/ 22 /2010) dated July
29, 2010;
10. GIR number furnished instead of PAN;
11. Bids made with the Bid Amounts paid through non-CTS enabled cheques;
12. Bids by Retail Individual Bidders with Bid Amount for a value of more than ` 200,000;
13. Bids by persons who are not eligible to acquire Equity Shares in terms of all applicable laws, rules,
regulations, guidelines and approvals;
14. Bids accompanied by stockinvest/money order/postal order/cash;
15. Bids by U.S. Persons, as defined under Regulation S of the U.S. Securities Act, outside the United States;
and
16. Bids uploaded by QIBs after 4.00 pm on the QIB Bid Closing Date and by Non-Institutional Bidders
uploaded after 4.00 p.m. on the Bid Closing Date, and Bids by Retail Individual Bidders uploaded after
5.00 p.m. on the Bid Closing Date, unless extended by the Stock Exchanges.

In terms of the RBI circular (No.DPSS.CO.CHD.No./133/04.07.05/2013-14) dated July 16, 2013, non-CTS cheques
would be processed in three CTS centres thrice a week until April 30, 2014, twice a week until October 31, 2014
and once a week from November 1, 2014 onwards. In order to enable listing and trading of Equity Shares within 12
Working Days of the Bid Closing Date, investors are advised to use CTS cheques or use the ASBA facility to make
payments. Investors are cautioned that Bid cum Application Forms accompanied by non-CTS cheques are liable to
be rejected.

Depository Arrangements

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The Allotment of the Equity Shares in the Issue shall be only in a de-materialised form, (i.e., not in the form of
physical certificates but be fungible and be represented by the statement issued through the electronic mode). In this
context, two agreements had been signed among the Bank, the respective Depositories and the Registrar to the Issue:

 Agreement dated April 12, 2010 among NSDL, the Bank and S.K.D.C. Consultants Limited.
 Agreement dated March 20, 2003 among CDSL, the Bank and S.K.D.C. Consultants Limited.

UNDERTAKINGS BY THE BANK

The Bank undertakes the following:

 That if the Company does not proceed with the Issue after the Bid Closing Date, the reason thereof shall be
given as a public notice within two days of the Bid Closing Date. The public notice shall be issued in the
same newspapers where the pre-Issue advertisements were published. The stock exchanges on which the
Equity Shares are proposed to be listed shall also be informed promptly;
 That the complaints received in respect of the Issue shall be attended to by the Bank expeditiously and
satisfactorily;
 That all steps for completion of the necessary formalities for listing and commencement of trading at all the
Stock Exchanges where the Equity Shares are proposed to be listed are taken within 12 Working Days of the
Bid Closing Date;
 Allotment letters shall be issued or application money shall be refunded within the specified time from the
Bid Closing Date or such lesser time specified by SEBI, else application money shall be refunded forthwith,
failing which interest shall be due to the applicants at the specified rate for the delayed period;
 That funds required for making refunds to unsuccessful applicants as per the mode(s) disclosed shall be made
available to the Registrar to the Issue by the Bank;
 That where refunds are made through electronic transfer of funds, a suitable communication shall be sent to
the applicant within 15 days from the Bid Closing Date, giving details of the bank where refunds shall be
credited along with amount and expected date of electronic credit of refund;
 That the certificates of the securities/ refund orders to Eligible NRIs shall be despatched within specified
time;
 That no further Issue of Equity Shares shall be made till the Equity Shares offered through the Red Herring
Prospectus are listed or until the Bid monies are refunded on account of non-listing, under-subscription etc.;
 That adequate arrangement shall be made to collect all Bid cum Application Forms under the ASBA process
and to consider them similar to non-ASBA Bids while finalising the Basis of Allotment; and
 The Bank shall not have recourse to the proceeds of the Issue until final approval for trading of the Equity
Shares from all Stock Exchanges where listing is sought has been received.

Utilisation of Issue proceeds

Our Bank certifies that:

 all monies received out of the Issue shall be credited/transferred to a separate bank account other than the
bank account referred to in sub-section (3) of Section 40 of the Companies Act;

 details of all monies utilised out of the Issue shall be disclosed, and continue to be disclosed till the time any
part of the Issue proceeds remains unutilised, under an appropriate head in the balance sheet of our Bank
indicating the purpose for which such monies have been utilised; and

 The Company shall not have recourse to the proceeds of the Issue until the final listing and trading approvals
from all the Stock Exchanges have been obtained

Withdrawal of the Issue

In accordance with the SEBI Regulations, the Bank, in consultation with Book Running Lead Managers, reserves

381
the right not to proceed with the Issue at any time after the Bid Opening Date. Provided if the Bank withdraws the
Issue after the Bid Closing Date, they will give reason thereof within two days of the Bid Closing Date by way of a
public notice in the same newspapers where the pre-Issue advertisements were published. Further, the Stock
Exchanges shall be informed promptly in this regard and the Book Running Lead Managers, through the Registrar to
the Issue, shall notify the SCSBs to unblock the ASBA Accounts within one Working Day from the date of receipt
of such notification.

Notwithstanding the foregoing, this Issue is also subject to obtaining the final listing and trading approvals of the
Stock Exchanges, which the Bank shall apply for after Allotment, and the final RoC approval of the Prospectus.

In the event our Bank, in consultation with the Book Running Lead Managers, withdraw the Issue after the Bid
Closing Date, a fresh offer document will be filed with the RoC/SEBI in the event we subsequently decide to
proceed with the Issue.

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 PART B

General Information Document for Investing in Public Issues

This General Information Document highlights the key rules, processes and procedures applicable to public issues
in accordance with the provisions of the Companies Act as amended or replaced by the Companies Act, 2013, the
Securities Contracts (Regulation) Act, 1956, the Securities Contracts (Regulation) Rules, 1957 and the Securities
and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.
Bidders/Applicants should not construe the contents of this General Information Document as legal advice and
should consult their own legal counsel and other advisors in relation to the legal matters concerning the Issue. For
taking an investment decision, the Bidders/Applicants should rely on their own examination of the Issuer and the
Issue, and should carefully read the Red Herring Prospectus/Prospectus before investing in the Issue.

SECTION 1: PURPOSE OF THE GENERAL INFORMATION DOCUMENT (GID)

This document is applicable to the public issues undertaken through the Book-Building process as well as to the
Fixed Price Issues. The purpose of the "General Information Document for Investing in Public Issues" is to provide
general guidance to potential Bidders/Applicants in IPOs and FPOs, on the processes and procedures governing
IPOs and FPOs, undertaken in accordance with the provisions of the Securities and Exchange Board of India (Issue
of Capital and Disclosure Requirements) Regulations, 2009 ("SEBI ICDR Regulations, 2009").

Bidders/Applicants should note that investment in equity and equity related securities involves risk and
Bidder/Applicant should not invest any funds in the Issue unless they can afford to take the risk of losing their
investment. The specific terms relating to securities and/or for subscribing to securities in an Issue and the relevant
information about the Issuer undertaking the Issue are set out in the Red Herring Prospectus ("RHP")/Prospectus
filed by the Issuer with the Registrar of Companies ("RoC"). Bidders/Applicants should carefully read the entire
RHP/Prospectus and the Bid cum Application Form/Application Form and the Abridged Prospectus of the Issuer in
which they are proposing to invest through the Issue. In case of any difference in interpretation or conflict and/or
overlap between the disclosure included in this document and the RHP/Prospectus, the disclosures in the
RHP/Prospectus shall prevail. The RHP/Prospectus of the Issuer is available on the websites of stock exchanges, on
the website(s) of the BRLMs to the Issue and on the website of Securities and Exchange Board of India ("SEBI") at
www.sebi.gov.in.

For the definitions of capitalized terms and abbreviations used herein Bidders/Applicants may refer to the section
"Glossary and Abbreviations".

SECTION 2: BRIEF INTRODUCTION TO IPOs/FPOs

2.1 Initial public offer (IPO)

An IPO means an offer of specified securities by an unlisted Issuer to the public for subscription and may include an
Offer for Sale of specified securities to the public by any existing holder of such securities in an unlisted Issuer.

For undertaking an IPO, an Issuer is inter-alia required to comply with the eligibility requirements of in terms of
either Regulation 26(1) or Regulation 26(2) of the SEBI ICDR Regulations, 2009. For details of compliance with the
eligibility requirements by the Issuer Bidders/Applicants may refer to the RHP/Prospectus.

2.2 Further public offer (FPO)

An FPO means an offer of specified securities by a listed Issuer to the public for subscription and may include Offer
for Sale of specified securities to the public by any existing holder of such securities in a listed Issuer.

For undertaking an FPO, the Issuer is inter-alia required to comply with the eligibility requirements in terms of
Regulation 26/27 of SEBI ICDR Regulations, 2009. For details of compliance with the eligibility requirements by
the Issuer Bidders/Applicants may refer to the RHP/Prospectus.

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2.3 Other Eligibility Requirements:

In addition to the eligibility requirements specified in paragraphs 2.1 and 2.2, an Issuer proposing to undertake an
IPO or an FPO is required to comply with various other requirements as specified in the SEBI ICDR Regulations,
2009, the Companies Act, 1956 (the "Companies Act") as amended or replaced by the Companies Act, 2013, the
Securities Contracts (Regulation) Rules, 1957 (the "SCRR"), industry-specific regulations, if any, and other
applicable laws for the time being in force.

For details in relation to the above Bidders/Applicants may refer to the RHP/Prospectus.

2.4 Types of Public Issues - Fixed Price Issues and Book Built Issues

In accordance with the provisions of the SEBI ICDR Regulations, 2009, an Issuer can either determine the Issue
Price through the Book Building Process ("Book Built Issue") or undertake a Fixed Price Issue ("Fixed Price
Issue"). An Issuer may mention Floor Price or Price Band in the RHP (in case of a Book Built Issue) and a Price or
Price Band in the Draft Prospectus (in case of a fixed price Issue) and determine the price at a later date before
registering the Prospectus with the Registrar of Companies.

The cap on the Price Band should be less than or equal to 120% of the Floor Price. The Issuer shall announce the
Price or the Floor Price or the Price Band through advertisement in all newspapers in which the pre-issue
advertisement was given at least five Working Days before the Bid/Issue Opening Date, in case of an IPO and at
least one Working Day before the Bid/Issue Opening Date, in case of an FPO.

The Floor Price or the Issue price cannot be lesser than the face value of the securities.

Bidders/Applicants should refer to the RHP/Prospectus or Issue advertisements to check whether the Issue is a Book
Built Issue or a Fixed Price Issue.

2.5 ISSUE PERIOD

The Issue may be kept open for a minimum of three Working Days (for all category of Bidders/Applicants) and not
more than ten Working Days. Bidders/Applicants are advised to refer to the Bid cum Application Form and
Abridged Prospectus or RHP/Prospectus for details of the Bid/Issue Period. Details of Bid/Issue Period are also
available on the website of Stock Exchange(s).

In case of a Book Built Issue, the Issuer may close the Bid/Issue Period for QIBs one Working Day prior to the
Bid/Issue Closing Date if disclosures to that effect are made in the RHP. In case of revision of the Floor Price or
Price Band in Book Built Issues the Bid/Issue Period may be extended by at least three Working Days, subject to the
total Bid/Issue Period not exceeding 10 Working Days. For details of any revision of the Floor Price or Price Band,
Bidders/Applicants may check the announcements made by the Issuer on the websites of the Stock Exchanges and
the BRLMs, and the advertisement in the newspaper(s) issued in this regard.

2.6 FLOWCHART OF TIMELINES

A flow chart of process flow in Fixed Price and Book Built Issues is as follows Bidders/Applicants may note that
this is not applicable for Fast Track FPOs.:

 In case of Issue other than Book Build Issue (Fixed Price Issue) the process at the following of the below
mentioned steps shall be read as:

(i) Step 7 : Determination of Issue Date and Price

(ii) Step 10: Applicant submits ASBA Application Form with Designated Branch of SCSB and Non-ASBA
forms directly to collection Bank and not to Broker.
(iii) Step 11: SCSB uploads ASBA Application details in Stock Exchange Platform
(iv) Step 12: Issue period closes
(v) Step 15: Not Applicable

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SECTION 3: CATEGORY OF INVESTORS ELIGIBLE TO PARTICIPATE IN AN ISSUE

Each Bidder/Applicant should check whether it is eligible to apply under applicable law.

Furthermore, certain categories of Bidders/Applicants, such as NRIs, FIIs, FPIs and FVCIs may not be allowed to
Bid/Apply in the Issue or to hold Equity Shares, in excess of certain limits specified under applicable law.
Bidders/Applicants are requested to refer to the RHP/Prospectus for more details.

Subject to the above, an illustrative list of Bidders/Applicants is as follows:

 Indian nationals resident in India who are competent to contract under the Indian Contract Act, 1872, in
single or joint names (not more than three);

 Bids/Applications belonging to an account for the benefit of a minor (under guardianship);

 Hindu Undivided Families or HUFs, in the individual name of the Karta. The Bidder/Applicant should
specify that the Bid is being made in the name of the HUF in the Bid cum Application Form/Application
Form as follows: "Name of sole or first Bidder/Applicant: XYZ Hindu Undivided Family applying through
XYZ, where XYZ is the name of the Karta". Bids/Applications by HUFs may be considered at par with
Bids/Applications from individuals;

 Companies, corporate bodies and societies registered under applicable law in India and authorised to invest
in equity shares;

 QIBs;

 NRIs on a repatriation basis or on a non-repatriation basis subject to applicable law;

 Indian Financial Institutions, regional rural banks, co-operative banks (subject to RBI regulations and the
SEBI ICDR Regulations, 2009 and other laws, as applicable);

 FIIs and sub-accounts registered with SEBI, other than a sub-account which is a foreign corporate or
foreign individual, bidding under the QIBs category;

 FPIs (other than Category III FPIs) bidding in the QIBs category;

 Category III FPIs bidding in the Non Institutional Bidders category;

 Sub-accounts of FIIs registered with SEBI, which are foreign corporates or foreign individuals only under
the Non Institutional Investors (NIIs) category;

 Trusts/societies registered under the Societies Registration Act, 1860, or under any other law relating to
trusts/societies and who are authorised under their respective constitutions to hold and invest in equity
shares;

 Limited liability partnerships registered under the Limited Liability Partnership Act, 2008; and

 Any other person eligible to Bid/Apply in the Issue, under the laws, rules, regulations, guidelines and
policies applicable to them and under Indian laws.

 As per the existing regulations, OCBs are not allowed to participate in an Issue.

SECTION 4: APPLYING IN THE ISSUE

Book Built Issue: Bidders should only use the specified Bid cum Application Form either bearing the stamp of a

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member of the Syndicate or bearing a stamp of the Registered Broker or stamp of SCSBs as available or
downloaded from the websites of the Stock Exchanges.

Bid cum Application Forms are available with the members of the Syndicate, Registered Brokers, Designated
Branches of the SCSBs and at the registered office of the Issuer. Electronic Bid cum Application Forms will be
available on the websites of the Stock Exchanges at least one day prior to the Bid/Issue Opening Date. For further
details regarding availability of Bid cum Application Forms, Bidders may refer to the RHP/Prospectus.

Fixed Price Issue: Applicants should only use the specified cum Application Form either bearing the stamp of
Collection Bank(s) or SCSBs as available or downloaded from the websites of the Stock Exchanges. Application
Forms are available with the Branches of Collection Banks or Designated Branches of the SCSBs and at the
registered office of the Issuer. For further details regarding availability of Application Forms, Applicants may refer
to the Prospectus.

Bidders/Applicants should ensure that they apply in the appropriate category. The prescribed color of the Bid cum
Application Form for various categories of Bidders/Applicants is as follows:

Color of the Bid cum

Category
Application Form
Resident Indian, Eligible NRIs applying on a non-repatriation basis White
NRIs, FVCIs, FIIs, their Sub-Accounts (other than Sub-Accounts which are foreign Blue
corporate(s) or foreign individuals bidding under the QIB), FPIs, QFIs, on a repatriation basis
Anchor Investors (where applicable) & Bidders/Applicants bidding/applying in the reserved [As specified by the Issuer]
category
Eligible Employees [As specified by the Issuer]

Securities Issued in an IPO can only be in dematerialized form in compliance with Section 29 of the Companies Act,
2013. Bidders/Applicants will not have the option of getting the allotment of specified securities in physical form.
However, they may get the specified securities rematerialised subsequent to allotment.

4.1 INSTRUCTIONS FOR FILING THE BID CUM APPLICATION FORM / APPLICATION FORM

Bidders/Applicants may note that forms not filled completely or correctly as per instructions provided in this GID,
the RHP and the Bid cum Application Form/Application Form are liable to be rejected.

Instructions to fill each field of the Bid cum Application Form can be found on the reverse side of the Bid cum
Application Form. Specific instructions for filling various fields of the Resident Bid cum Application Form and
Non-Resident Bid cum Application Form and samples are provided below.

The samples of the Bid cum Application Form for resident Bidders and the Bid cum Application Form for non-
resident Bidders are reproduced below:

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4.1.1 FIELD NUMBER 1: NAME AND CONTACT DETAILS OF THE SOLE/FIRST
BIDDER/APPLICANT

(a) Bidders/Applicants should ensure that the name provided in this field is exactly the same as the
name in which the Depository Account is held.

(b) Mandatory Fields: Bidders/Applicants should note that the name and address fields are
compulsory and e-mail and/or telephone number/mobile number fields are optional.
Bidders/Applicants should note that the contact details mentioned in the Bid-cum Application
Form/Application Form may be used to dispatch communications(including refund orders and
letters notifying the unblocking of the bank accounts of ASBA Bidders/Applicants) in case the
communication sent to the address available with the Depositories are returned undelivered or are
not available. The contact details provided in the Bid cum Application Form may be used by the
Issuer, the members of the Syndicate, the Registered Broker and the Registrar to the Issue only for
correspondence(s) related to an Issue and for no other purposes.

(c) Joint Bids/Applications: In the case of Joint Bids/Applications, the Bids /Applications should be
made in the name of the Bidder/Applicant whose name appears first in the Depository account.
The name so entered should be the same as it appears in the Depository records. The signature of
only such first Bidder/Applicant would be required in the Bid cum Application Form/Application
Form and such first Bidder/Applicant would be deemed to have signed on behalf of the joint
holders All payments may be made out in favor of the Bidder/Applicant whose name appears in
the Bid cum Application Form/Application Form or the Revision Form and all communications
may be addressed to such Bidder/Applicant and may be dispatched to his or her address as per the
Demographic Details received from the Depositories.

(d) Impersonation: Attention of the Bidders/Applicants is specifically drawn to the provisions of

sub-section (1) of Section 38 of the Companies Act, which is reproduced below:

“Any person who –

(a) makes or abets making of an application in a fictitious name to a company for acquiring,
or subscribing for, its securities, or
(b) makes or abets making of multiple applications to a company in different names or in
different combinations of his name or surname for acquiring or subscribing for its
securities; or
(c) otherwise induces directly or indirectly a company to allot, or register any transfer of,
securities to him, or to any other person in a fictitious name,

shall be liable for action under section 447.”

The liability prescribed under Section 447 of the Companies Act, 2013 includes imprisonment for
a term of not less than six months extending up to ten years (provided that where the fraud
involves public interest, such term shall not be less than three years) and fine of an amount not less
than the amount involved in the fraud, extending up to three times of such amount.

(e) Nomination Facility to Bidder/Applicant: Nomination facility is available in accordance with

the provisions of Section 72 of the Companies Act, 2013. In case of allotment of the Equity Shares
in dematerialized form, there is no need to make a separate nomination as the nomination
registered with the Depository may prevail. For changing nominations, the Bidders/Applicants
should inform their respective DP.

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4.1.2 FIELD NUMBER 2: PAN NUMBER OF SOLE/FIRST BIDDER/APPLICANT

(a) PAN (of the sole/ first Bidder/Applicant) provided in the Bid cum Application Form/Application
Form should be exactly the same as the PAN of the person(s) in whose name the relevant
beneficiary account is held as per the Depositories' records.

(b) PAN is the sole identification number for participants transacting in the securities market
irrespective of the amount of transaction except for Bids/Applications on behalf of the Central or
State Government, Bids/Applications by officials appointed by the courts and Bids/Applications
by Bidders/Applicants residing in Sikkim ("PAN Exempted Bidders/Applicants"). Consequently,
all Bidders/Applicants, other than the PAN Exempted Bidders/Applicants, are required to disclose
their PAN in the Bid cum Application Form/Application Form, irrespective of the Bid/Application
Amount. A Bid cum Application Form/Application Form without PAN, except in case of
Exempted Bidders/Applicants, is liable to be rejected. Bids/Applications by the
Bidders/Applicants whose PAN is not available as per the Demographic Details available in their
Depository records, are liable to be rejected.

(c) The exemption for the PAN Exempted Bidders/Applicants is subject to (a) the Demographic
Details received from the respective Depositories confirming the exemption granted to the
beneficiary owner by a suitable description in the PAN field and the beneficiary account remaining
in "active status"; and (b) in the case of residents of Sikkim, the address as per the Demographic
Details evidencing the same.

(d) Bid cum Application Forms/Application Forms which provide the General Index Register Number
instead of PAN may be rejected.

(e) Bids/Applications by Bidders whose demat accounts have been 'suspended for credit' are liable to
be rejected pursuant to the circular issued by SEBI on July 29, 2010, bearing number
CIR/MRD/DP/22/2010. Such accounts are classified as "Inactive demat accounts" and
demographic details are not provided by depositories.

4.1.3 FIELD NUMBER 3: BIDDERS/APPLICANTS DEPOSITORY ACCOUNT DETAILS

(a) Bidders/Applicants should ensure that DP ID and the Client ID are correctly filled in the Bid cum
Application Form/Application Form. The DP ID and Client ID provided in the Bid cum
Application Form/Application Form should match with the DP ID and Client ID available in the
Depository database, otherwise, the Bid cum Application Form/Application Form is liable to
be rejected.

(b) Bidders/Applicants should ensure that the beneficiary account provided in the Bid cum
Application Form/Application Form is active.

(c) Bidders/Applicants should note that on the basis of DP ID and Client ID as provided in the Bid
cum Application Form/Application Form, the Bidder/Applicant may be deemed to have authorized
the Depositories to provide to the Registrar to the Issue, any requested Demographic Details of the
Bidder/Applicant as available on the records of the depositories. These Demographic Details may
be used, among other things, for giving refunds and allocation advice (including through physical
refund warrants, direct credit, NECS, NEFT and RTGS), or unblocking of ASBA Account or for
other correspondence(s) related to an Issue. Please note that refunds, on account of our Bank not
receiving the minimum subscription of 90% of the Issue, shall be credited only to the bank
account from which the Bid Amount was remitted to the Escrow Bank.

(d) Bidders/Applicants are, advised to update any changes to their Demographic Details as available
in the records of the Depository Participant to ensure accuracy of records. Any delay resulting
from failure to update the Demographic Details would be at the Bidders/Applicants' sole risk.

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4.1.4 FIELD NUMBER 4: BID OPTIONS

(a) Price or Floor Price or Price Band, minimum Bid Lot and Discount (if applicable) may be
disclosed in the Prospectus/RHP by the Issuer. The Issuer is required to announce the Floor Price
or Price Band, minimum Bid Lot and Discount (if applicable) by way of an advertisement in at
least one English, one Hindi and one regional newspaper, with wide circulation, at least five
Working Days before Bid/Issue Opening Date in case of an IPO, and at least one Working Day
before Bid/Issue Opening Date in case of an FPO.

(b) The Bidders may Bid at or above Floor Price or within the Price Band for IPOs /FPOs undertaken
through the Book Building Process. In the case of Alternate Book Building Process for an FPO,
the Bidders may Bid at Floor Price or any price above the Floor Price (For further details bidders
may refer to (Section 5.6 (e))

(c) Cut-Off Price: Retail Individual Investors or Employees or Retail Individual Shareholders can
Bid at the Cut-off Price indicating their agreement to Bid for and purchase the Equity Shares at the
Issue Price as determined at the end of the Book Building Process. Bidding at the Cut-off Price is
prohibited for QIBs and NIIs and such Bids from QIBs and NIIs may be rejected.

(d) Minimum Application Value and Bid Lot: The Issuer, in consultation with the BRLMs may
decide the minimum number of Equity Shares for each Bid to ensure that the minimum application
value is within the range of ` 10,000 to ` 15,000. The minimum Bid Lot is accordingly determined
by an Issuer on basis of such minimum application value.

(e) Allotment: The allotment of specified securities to each RII shall not be less than the minimum
Bid Lot, subject to availability of shares in the RII category, and the remaining available shares, if
any, shall be allotted on a proportionate basis. For details of the Bid Lot, bidders may to the
RHP/Prospectus or the advertisement regarding the Price Band published by the Issuer.

4.1.4.1 Maximum and Minimum Bid Size

(a) The Bidder may Bid for the desired number of Equity Shares at a specific price. Bids by Retail
Individual Investors, Employees and Retail Individual Shareholders must be for such number of
shares so as to ensure that the Bid Amount less Discount (as applicable), payable by the Bidder
does not exceed ` 200,000.

In case the Bid Amount exceeds ` 200,000 due to revision of the Bid or any other reason, the Bid
may be considered for allocation under the Non-Institutional Category, with it not being eligible
for Discount then such Bid may be rejected if it is at the Cut-off Price.

(b) For NRIs, a Bid Amount of up to ` 200,000 may be considered under the Retail Category for the
purposes of allocation and a Bid Amount exceeding ` 200,000 may be considered under the Non-
Institutional Category for the purposes of allocation.

(c) Bids by QIBs and NIIs must be for such minimum number of shares such that the Bid Amount
exceeds ` 200,000 and in multiples of such number of Equity Shares thereafter, as may be
disclosed in the Bid cum Application Form and the RHP/Prospectus, or as advertised by the Issuer,
as the case may be. Non-Institutional Bidders and QIBs are not allowed to Bid at 'Cut-off Price'.

(d) RII may revise their bids till closure of the bidding period or withdraw their bids until finalization
of allotment. QIBs and NII's cannot withdraw or lower their Bids (in terms of quantity of Equity
Shares or the Bid Amount) at any stage after bidding and are required to pay the Bid Amount upon
submission of the Bid.

(e) In case the Bid Amount reduces to ` 200,000 or less due to a revision of the Price Band, Bids by
the Non-Institutional Bidders who are eligible for allocation in the Retail Category would be

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 considered for allocation under the Retail Category.

(f) For Anchor Investors, if applicable, the Bid Amount shall be least ` 10 crores. One-third of the
Anchor Investor Portion shall be reserved for domestic Mutual Funds, subject to valid Bids being
received from domestic Mutual Funds at or above the price at which allocation is being done to
other Anchor Investors. Bids by various schemes of a Mutual Fund shall be aggregated to
determine the Bid Amount. A Bid cannot be submitted for more than 60% of the QIB Portion
under the Anchor Investor Portion. Anchor Investors cannot withdraw their Bids or lower the size
of their Bids (in terms of quantity of Equity Shares or the Bid Amount) at any stage after the
Anchor Investor Bid/ Issue Period and are required to pay the Bid Amount at the time of
submission of the Bid. In case the Anchor Investor Issue Price is lower than the Issue Price, the
balance amount shall be payable as per the pay-in-date mentioned in the revised CAN. In case the
Issue Price is lower than the Anchor Investor Issue Price, the amount in excess of the Issue Price
paid by the Anchor Investors shall not be refunded to them.

(g) A Bid cannot be submitted for more than the Issue size.

(h) The maximum Bid by any Bidder including QIB Bidder should not exceed the investment limits
prescribed for them under the applicable laws.

(i) The price and quantity options submitted by the Bidder in the Bid cum Application Form may be
treated as optional bids from the Bidder and may not be cumulated. After determination of the
Issue Price, the number of Equity Shares Bid for by a Bidder at or above the Issue Price may be
considered for allotment and the rest of the Bid(s), irrespective of the Bid Amount may
automatically become invalid. This is not applicable in case of FPOs undertaken through Alternate
Book Building Process (For details of bidders may refer to (Section 5.6 (e))

4.1.4.2 Multiple Bids

(a) Bidder should submit only one Bid cum Application Form. Bidder shall have the option to make a
maximum of Bids at three different price levels in the Bid cum Application Form and such options
are not considered as multiple Bids.

Submission of a second Bid cum Application Form to either the same or to another member of the
Syndicate, SCSB or Registered Broker and duplicate copies of Bid cum Application Forms
bearing the same application number shall be treated as multiple Bids and are liable to be rejected.

(b) Bidders are requested to note the following procedures may be followed by the Registrar to the
Issue to detect multiple Bids:

(i) Bids by Reserved Categories bidding in their respective Reservation Portion as well as
bids made by them in the Net Issue portion in public category

(ii) All Bids may be checked for common PAN as per the records of the Depository. For
Bidders other than Mutual Funds and FII sub-accounts, Bids bearing the same PAN may
be treated as multiple Bids by a Bidder and may be rejected.

(iii) For Bids from Mutual Funds and FII sub-accounts, submitted under the same PAN, as
well as Bids on behalf of the PAN Exempted Bidders, the Bid cum Application Forms
may be checked for common DP ID and Client ID. Such Bids which have the same DP
ID and Client ID may be treated as multiple Bids and are liable to be rejected.

(c) The following Bids may not be treated as multiple Bids:

(i) Separate Bids by Mutual Funds in respect of more than one scheme of the Mutual Fund
provided that the Bids clearly indicate the scheme for which the Bid has been made.

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 (ii) Bids by Mutual Funds, and sub-accounts of FIIs (or FIIs and its sub-accounts) submitted
with the same PAN but with different beneficiary account numbers, Client IDs and DP
IDs.

(iii) Bids by Anchor Investors under the Anchor Investor Portion and the QIB Category.

4.1.5 FIELD NUMBER 5: CATEGORY OF BIDDERS

(a) The categories of Bidders identified as per the SEBI ICDR Regulations, 2009 for the purpose of
Bidding, allocation and allotment in the Issue are RIIs, NIIs and QIBs.

(b) Upto 60% of the QIB Category can be allocated by the Issuer, on a discretionary basis [subject to
the criteria of minimum and maximum number of anchor investors based on allocation size], to
the Anchor Investors, in accordance with SEBI ICDR Regulations, 2009, with one-third of the
Anchor Investor Portion reserved for domestic Mutual Funds subject to valid Bids being received
at or above the Issue Price. For details regarding allocation to Anchor Investors, bidders may refer
to the RHP/Prospectus.

(c) An Issuer can make reservation for certain categories of Bidders/Applicants as permitted under the
SEBI ICDR Regulations, 2009. For details of any reservations made in the Issue,
Bidders/Applicants may refer to the RHP/Prospectus.

(d) The SEBI ICDR Regulations, 2009, specify the allocation or allotment that may be made to
various categories of Bidders in an Issue depending upon compliance with the eligibility
conditions. Details pertaining to allocation are disclosed on reverse side of the Revision Form. For
Issue specific details in relation to allocation Bidder/Applicant may refer to the RHP/Prospectus.

4.1.6 FIELD NUMBER 6: INVESTOR STATUS

(a) Each Bidder/Applicant should check whether it is eligible to apply under applicable law and
ensure that any prospective allotment to it in the Issue is in compliance with the investment
restrictions under applicable law.

(b) Certain categories of Bidders/Applicants, such as NRIs, FIIs, FPIs and FVCIs may not be allowed
to Bid/Apply in the Issue or hold Equity Shares exceeding certain limits specified under applicable
law. Bidders/Applicants are requested to refer to the RHP/Prospectus for more details.

(c) Bidders/Applicants should check whether they are eligible to apply on non-repatriation basis or
repatriation basis and should accordingly provide the investor status. Details regarding investor
status are different in the Resident Bid cum Application Form and Non-Resident Bid cum
Application Form.

(d) Bidders/Applicants should ensure that their investor status is updated in the Depository records.

4.1.7 FIELD NUMBER 7: PAYMENT DETAILS

(a) All Bidders are required to make payment of the full Bid Amount (net of any Discount, as
applicable) along-with the Bid cum Application Form. If the Discount is applicable in the Issue,
the RIIs should indicate the full Bid Amount in the Bid cum Application Form and the payment
shall be made for Bid Amount net of Discount. Only in cases where the RHP/Prospectus indicates
that part payment may be made, such an option can be exercised by the Bidder. In case of Bidders
specifying more than one Bid Option in the Bid cum Application Form, the total Bid Amount may
be calculated for the highest of three options at net price, i.e. Bid price less Discount offered, if
any.

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 (b) Bidders who Bid at Cut-off price shall deposit the Bid Amount based on the Cap Price.

(c) QIBs and NIIs can participate in the Issue only through the ASBA mechanism.

(d) RIIs bidding in the Retail Portion can Bid, either through the ASBA mechanism or by paying the
Bid Amount through a cheque or a demand draft ("Non-ASBA Mechanism").

(e) Bid Amount cannot be paid in cash, through money order or through postal order.

4.1.7.1 Instructions for non-ASBA Bidders:

(a) Non-ASBA Bidders may submit their Bids with a member of the Syndicate or any of the
Registered Brokers of the Stock Exchange. The details of Broker Centres along with names and
contact details of the Registered Brokers are provided on the websites of the Stock Exchanges.

(b) For Bids made through a member of the Syndicate: The Bidder may, with the submission of
the Bid cum Application Form, draw a cheque or demand draft for the Bid Amount in favour of
the Escrow Account as specified under the RHP/Prospectus and the Bid cum Application Form
and submit the same to the members of the Syndicate at Specified Locations.

(c) For Bids made through a Registered Broker: The Bidder may, with the submission of the Bid
cum Application Form, draw a cheque or demand draft for the Bid Amount in favour of the
Escrow Account as specified under the RHP/Prospectus and the Bid cum Application Form and
submit the same to the Registered Broker.

(d) If the cheque or demand draft accompanying the Bid cum Application Form is not made favoring
the Escrow Account, the Bid is liable to be rejected.

(e) Payments should be made by cheque, or demand draft drawn on any bank (including a cooperative
bank), which is situated at, and is a member of or sub-member of the bankers' clearing house
located at the centre where the Bid cum Application Form is submitted. Cheques/bank drafts
drawn on banks not participating in the clearing process may not be accepted and applications
accompanied by such cheques or bank drafts are liable to be rejected.

(f) The Escrow Collection Banks shall maintain the monies in the Escrow Account for and on behalf
of the Bidders until the Designated Date.

(g) Bidders are advised to provide the number of the Bid cum Application Form and PAN on the
reverse of the cheque or bank draft to avoid any possible misuse of instruments submitted.

4.1.7.2 Payment instructions for ASBA Bidders

(a) ASBA Bidders may submit the Bid cum Application Form either

(i) in physical mode to the Designated Branch of an SCSB where the Bidders/Applicants
have ASBA Account, or

(ii) in electronic mode through the internet banking facility offered by an SCSB authorizing
blocking of funds that are available in the ASBA account specified in the Bid cum
Application Form, or

(iii) in physical mode to a member of the Syndicate at the Specified Locations or

(iv) Registered Brokers of the Stock Exchange

(b) ASBA Bidders may specify the Bank Account number in the Bid cum Application Form. The Bid

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 cum Application Form submitted by an ASBA Bidder and which is accompanied by cash, demand
draft, money order, postal order or any mode of payment other than blocked amounts in the ASBA
Account maintained with an SCSB, may not be accepted.

(c) Bidders should ensure that the Bid cum Application Form is also signed by the ASBA Account
holder(s) if the Bidder is not the ASBA Account holder;

(d) Bidders shall note that for the purpose of blocking funds under ASBA facility clearly demarcated
funds shall be available in the account.

(e) From one ASBA Account, a maximum of five Bids cum Application Forms can be submitted.

(f) ASBA Bidders bidding through a member of the Syndicate should ensure that the Bid cum
Application Form is submitted to a member of the Syndicate only at the Specified locations.
ASBA Bidders should also note that Bid cum Application Forms submitted to a member of the
Syndicate at the Specified locations may not be accepted by the Member of the Syndicate if the
SCSB where the ASBA Account, as specified in the Bid cum Application Form, is maintained has
not named at least one branch at that location for the members of the Syndicate to deposit Bid cum
Application Forms (a list of such branches is available on the website of SEBI at
http://www.sebi.gov.in/sebiweb/home/list/5/33/0/0/Recognised-Intermediaries).

(g) ASBA Bidders bidding through a Registered Broker should note that Bid cum Application
Forms submitted to the Registered Brokers may not be accepted by the Registered Broker, if the
SCSB where the ASBA Account, as specified in the Bid cum Application Form, is maintained has
not named at least one branch at that location for the Registered Brokers to deposit Bid cum
Application Forms.

(h) ASBA Bidders bidding directly through the SCSBs should ensure that the Bid cum Application
Form is submitted to a Designated Branch of a SCSB where the ASBA Account is maintained.

(i) Upon receipt of the Bid cum Application Form, the Designated Branch of the SCSB may verify if
sufficient funds equal to the Bid Amount are available in the ASBA Account, as mentioned in the
Bid cum Application Form.

(j) If sufficient funds are available in the ASBA Account, the SCSB may block an amount equivalent
to the Bid Amount mentioned in the Bid cum Application Form and for application directly
submitted to SCSB by investor, may enter each Bid option into the electronic bidding system as a
separate Bid.

(k) If sufficient funds are not available in the ASBA Account, the Designated Branch of the SCSB
may not upload such Bids on the Stock Exchange platform and such bids are liable to be rejected.

(l) Upon submission of a completed Bid cum Application Form each ASBA Bidder may be deemed to
have agreed to block the entire Bid Amount and authorized the Designated Branch of the SCSB to
block the Bid Amount specified in the Bid cum Application Form in the ASBA Account
maintained with the SCSBs.

(m) The Bid Amount may remain blocked in the aforesaid ASBA Account until finalisation of the
Basis of allotment and consequent transfer of the Bid Amount against the Allotted Equity Shares
to the Public Issue Account, or until withdrawal or failure of the Issue, or until withdrawal or
rejection of the Bid, as the case may be.

(n) SCSBs bidding in the Issue must apply through an Account maintained with any other SCSB; else
their Bids are liable to be rejected.

4.1.7.2.1 Unblocking of ASBA Account

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 (a) Once the Basis of Allotment is approved by the Designated Stock Exchange, the Registrar to the
Issue may provide the following details to the controlling branches of each SCSB, along with
instructions to unblock the relevant bank accounts and for successful applications transfer the
requisite money to the Public Issue Account designated for this purpose, within the specified
timelines: (i) the number of Equity Shares to be Allotted against each Bid, (ii) the amount to be
transferred from the relevant bank account to the Public Issue Account, for each Bid, (iii) the date
by which funds referred to in (ii) above may be transferred to the Public Issue Account, and (iv)
details of rejected ASBA Bids, if any, along with reasons for rejection and details of withdrawn or
unsuccessful Bids, if any, to enable the SCSBs to unblock the respective bank accounts.

(b) On the basis of instructions from the Registrar to the Issue, the SCSBs may transfer the requisite
amount against each successful ASBA Bidder to the Public Issue Account and may unblock the
excess amount, if any, in the ASBA Account.

(c) In the event of withdrawal or rejection of the Bid cum Application Form and for unsuccessful
Bids, the Registrar to the Issue may give instructions to the SCSB to unblock the Bid Amount in
the relevant ASBA Account within 12 Working Days of the Bid/Issue Closing Date.

4.1.7.3 Additional Payment Instructions for NRIs

The Non-Resident Indians who intend to make payment through Non-Resident Ordinary (NRO) accounts
shall use the form meant for Resident Indians (non-repatriation basis). In the case of Bids by NRIs applying
on a repatriation basis, payment shall not be accepted out of NRO Account.

4.1.7.4 Discount (if applicable)

(a) The Discount is stated in absolute rupee terms.

(b) Bidders applying under RII category, Retail Individual Shareholder and employees are only
eligible for discount. For Discounts offered in the Issue, Bidders may refer to the RHP/Prospectus.

(c) The Bidders entitled to the applicable Discount in the Issue may make payment for an amount i.e.
the Bid Amount less Discount (if applicable).

Bidder may note that in case the net payment (post Discount) is more than two lakh Rupees, the bidding
system automatically considers such applications for allocation under Non-Institutional Category. These
applications are neither eligible for Discount nor fall under RII category.

4.1.8 FIELD NUMBER 8: SIGNATURES AND OTHER AUTHORISATIONS

(a) Only the First Bidder/Applicant is required to sign the Bid cum Application Form/Application
Form. Bidders/Applicants should ensure that signatures are in one of the languages specified in the
Eighth Schedule to the Constitution of India.

(b) If the ASBA Account is held by a person or persons other than the ASBA Bidder/Applicant., then
the Signature of the ASBA Account holder(s) is also required.

(c) In relation to the ASBA Bids/Applications, signature has to be correctly affixed in the
authorization/undertaking box in the Bid cum Application Form/Application Form, or an
authorisation has to be provided to the SCSB via the electronic mode, for blocking funds in the
ASBA Account equivalent to the Bid Amount mentioned in the Bid cum Application
Form/Application Form.

(d) Bidders/Applicants must note that Bid cum Application Form/Application Form without signature
of Bidder/Applicant and /or ASBA Account holder is liable to be rejected.

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4.1.9 ACKNOWLEDGEMENT AND FUTURE COMMUNICATION

(a) Bidders should ensure that they receive the acknowledgment duly signed and stamped by a
member of the Syndicate, Registered Broker or SCSB, as applicable, for submission of the Bid
cum Application Form.

(b) Applicants should ensure that they receive the acknowledgment duly signed and stamped by an
Escrow Collection Bank or SCSB, as applicable, for submission of the Application Form.

(c) All communications in connection with Bids/Applications made in the Issue should be addressed
as under:

(i) In case of queries related to Allotment, non-receipt of Allotment Advice, credit of allotted
equity shares, refund orders, the Bidders/Applicants should contact the Registrar to the
Issue.

(ii) In case of ASBA Bids submitted to the Designated Branches of the SCSBs, the
Bidders/Applicants should contact the relevant Designated Branch of the SCSB.

(iii) In case of queries relating to uploading of Syndicate ASBA Bids, the Bidders/Applicants
should contact the relevant Syndicate Member.

(iv) In case of queries relating to uploading of Bids by a Registered Broker, the

Bidders/Applicants should contact the relevant Registered Broker.

(v) Bidder/Applicant may contact the Company Secretary and Compliance Officer or
BRLMs in case of any other complaints in relation to the Issue.

(d) The following details (as applicable) should be quoted while making any queries –

(i) full name of the sole or First Bidder/Applicant, Bid cum Application Form number,
Applicants'/Bidders' DP ID, Client ID, PAN, number of Equity Shares applied for,
amount paid on application.

(ii) name and address of the member of the Syndicate, Registered Broker or the Designated
Branch, as the case may be, where the Bid was submitted or

(iii) In case of Non-ASBA bids cheque or draft number and the name of the issuing bank
thereof

(iv) In case of ASBA Bids, ASBA Account number in which the amount equivalent to the Bid
Amount was blocked.

For further details, Bidder/Applicant may refer to the RHP/Prospectus and the Bid cum
Application Form.

4.2 INSTRUCTIONS FOR FILING THE REVISION FORM

(a) During the Bid/Issue Period, any Bidder/Applicant (other than QIBs and NIIs, who can only revise
their bid upwards) who has registered his or her interest in the Equity Shares at a particular price
level is free to revise his or her Bid within the Price Band using the Revision Form, which is a part
of the Bid cum Application Form.

(b) RII may revise their bids till closure of the bidding period or withdraw their bids until finalization
of allotment.

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 (c) Revisions can be made in both the desired number of Equity Shares and the Bid Amount by using
the Revision Form.

(d) The Bidder/Applicant can make this revision any number of times during the Bid/ Issue Period.
However, for any revision(s) in the Bid, the Bidders/Applicants will have to use the services of the
same member of the Syndicate, the Registered Broker or the SCSB through which such
Bidder/Applicant had placed the original Bid. Bidders/Applicants are advised to retain copies of
the blank Revision Form and the Bid(s) must be made only in such Revision Form or copies
thereof.

A sample Revision form is reproduced below:

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Instructions to fill each field of the Revision Form can be found on the reverse side of the Revision Form. Other than
instructions already highlighted at paragraph 4.1 above, point wise instructions regarding filling up various fields of
the Revision Form are provided below:

4.2.1 FIELDS 1, 2 AND 3: NAME AND CONTACT DETAILS OF SOLE/FIRST BIDDER/APPLICANT,

PAN OF SOLE/FIRST BIDDER/APPLICANT AND DEPOSITORY ACCOUNT DETAILS OF THE
BIDDER/APPLICANT

Bidders/Applicants should refer to instructions contained in paragraphs 4.1.1, 4.1.2 and 4.1.3.

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4.2.2 FIELD 4 AND 5: BID OPTIONS REVISION 'FROM' AND 'TO'

(a) Apart from mentioning the revised options in the Revision Form, the Bidder/Applicant must also
mention the details of all the bid options given in his or her Bid cum Application Form or earlier
Revision Form. For example, if a Bidder/Applicant has Bid for three options in the Bid cum
Application Form and such Bidder/Applicant is changing only one of the options in the Revision
Form, the Bidder/Applicant must still fill the details of the other two options that are not being
revised, in the Revision Form. The members of the Syndicate, the Registered Brokers and the
Designated Branches of the SCSBs may not accept incomplete or inaccurate Revision Forms.

(b) In case of revision, Bid options should be provided by Bidders/Applicants in the same order as
provided in the Bid cum Application Form.

(c) In case of revision of Bids by RIIs, Employees and Retail Individual Shareholders, such
Bidders/Applicants should ensure that the Bid Amount, subsequent to revision, does not exceed `
200,000. In case the Bid Amount exceeds ` 200,000 due to revision of the Bid or for any other
reason, the Bid may be considered, subject to eligibility, for allocation under the Non-Institutional
Category, not being eligible for Discount (if applicable) and such Bid may be rejected if it is at the
Cut-off Price. The Cut-off Price option is given only to the RIIs, Employees and Retail Individual
Shareholders indicating their agreement to Bid for and purchase the Equity Shares at the Issue
Price as determined at the end of the Book Building Process.

(d) In case the total amount (i.e., original Bid Amount plus additional payment) exceeds ` 200,000,
the Bid will be considered for allocation under the Non-Institutional Portion in terms of the
RHP/Prospectus. If, however, the RII does not either revise the Bid or make additional payment
and the Issue Price is higher than the cap of the Price Band prior to revision, the number of Equity
Shares Bid for shall be adjusted downwards for the purpose of allocation, such that no additional
payment would be required from the RII and the RII is deemed to have approved such revised Bid
at Cut-off Price.

(e) In case of a downward revision in the Price Band, RIIs who have bid at the Cut-off Price could
either revise their Bid or the excess amount paid at the time of bidding may be unblocked in case
of ASBA Bidders or refunded from the Escrow Account in case of non-ASBA Bidder.

4.2.3 FIELD 6: PAYMENT DETAILS

(a) With respect to the Bids, other than Bids submitted by ASBA Bidders/Applicants, any revision of
the Bid should be accompanied by payment in the form of cheque or demand draft for the amount,
if any, to be paid on account of the upward revision of the Bid.

(b) All Bidders/Applicants are required to make payment of the full Bid Amount (less Discount (if
applicable) along with the Bid Revision Form. In case of Bidders/Applicants specifying more than
one Bid Option in the Bid cum Application Form, the total Bid Amount may be calculated for the
highest of three options at net price, i.e. Bid price less discount offered, if any.

(c) In case of Bids submitted by ASBA Bidder/Applicant, Bidder/Applicant may Issue instructions to
block the revised amount based on cap of the revised Price Band (adjusted for the Discount (if
applicable) in the ASBA Account, to the same member of the Syndicate/Registered Broker or the
same Designated Branch (as the case may be) through whom such Bidder/Applicant had placed
the original Bid to enable the relevant SCSB to block the additional Bid Amount, if any.

(d) In case of Bids, other than ASBA Bids, Bidder/Applicant, may make additional payment based on
the cap of the revised Price Band (such that the total amount i.e., original Bid Amount plus
additional payment does not exceed ` 200,000 if the Bidder/Applicant wants to continue to Bid at
the Cut-off Price), with the members of the Syndicate / Registered Broker to whom the original
Bid was submitted.

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 (e) In case the total amount (i.e., original Bid Amount less discount (if applicable) plus additional
payment) exceeds ` 200,000, the Bid may be considered for allocation under the Non-Institutional
Category in terms of the RHP/Prospectus. If, however, the Bidder/Applicant does not either revise
the Bid or make additional payment and the Issue Price is higher than the cap of the Price Band
prior to revision, the number of Equity Shares Bid for may be adjusted downwards for the purpose
of allotment, such that no additional payment is required from the Bidder/Applicant and the
Bidder/Applicant is deemed to have approved such revised Bid at the Cut-off Price.

(f) In case of a downward revision in the Price Band, RIIs, Employees and Retail Individual
Shareholders, who have bid at the Cut-off Price, could either revise their Bid or the excess amount
paid at the time of bidding may be unblocked in case of ASBA Bidders/Applicants or refunded
from the Escrow Account in case of non-ASBA Bidder/Applicant.

4.2.4 FIELDS 7: SIGNATURES AND ACKNOWLEDGEMENTS

Bidders/Applicants may refer to instructions contained at paragraphs 4.1.8 and 4.1.9 for this purpose.

4.3 INSTRUCTIONS FOR FILING APPLICATION FORM IN ISSUES MADE OTHER THAN
THROUGH THE BOOK BUILDING PROCESS (FIXED PRICE ISSUE)

4.3.1 FIELDS 1, 2, 3 NAME AND CONTACT DETAILS OF SOLE/FIRST BIDDER/APPLICANT, PAN

OF SOLE/FIRST BIDDER/APPLICANT AND DEPOSITORY ACCOUNT DETAILS OF THE
BIDDER/APPLICANT

Applicants should refer to instructions contained in paragraphs 4.1.1, 4.1.2 and 4.1.3.

4.3.2 FIELD 4: PRICE, APPLICATION QUANTITY AND AMOUNT

(a) The Issuer may mention Price or Price band in the draft Prospectus. However a prospectus
registered with RoC contains one price or coupon rate (as applicable).

(b) Minimum Application Value and Bid Lot: The Issuer in consultation with the Lead Managers to
the Issue (LM) may decide the minimum number of Equity Shares for each Bid to ensure that the
minimum application value is within the range of ` 10,000 to ` 15,000. The minimum Lot size is
accordingly determined by an Issuer on basis of such minimum application value.

(c) Applications by RIIs, Employees and Retail Individual Shareholders, must be for such number of
shares so as to ensure that the application amount payable does not exceed ` 200,000.

(d) Applications by other investors must be for such minimum number of shares such that the
application amount exceeds ` 200,000 and in multiples of such number of Equity Shares
thereafter, as may be disclosed in the application form and the Prospectus, or as advertised by the
Issuer, as the case may be.

(e) An application cannot be submitted for more than the Issue size.

(f) The maximum application by any Applicant should not exceed the investment limits prescribed for
them under the applicable laws.

(g) Multiple Applications: An Applicant should submit only one Application Form. Submission of a
second Application Form to either the same or to Collection Bank(s) or SCSB and duplicate copies
of Application Forms bearing the same application number shall be treated as multiple
applications and are liable to be rejected.

(h) Applicants are requested to note the following procedures may be followed by the Registrar to the

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 Issue to detect multiple applications:

(i) All applications may be checked for common PAN as per the records of the Depository.
For Applicants other than Mutual Funds and FII sub-accounts, Bids bearing the same
PAN may be treated as multiple applications by a Bidder/Applicant and may be rejected.

(ii) For applications from Mutual Funds and FII sub-accounts, submitted under the same
PAN, as well as Bids on behalf of the PAN Exempted Applicants, the Application Forms
may be checked for common DP ID and Client ID. In any such applications which have
the same DP ID and Client ID, these may be treated as multiple applications and may be
rejected.

(i) The following applications may not be treated as multiple Bids:

(i) Applications by Reserved Categories in their respective reservation portion as well as that
made by them in the Net Issue portion in public category.

(ii) Separate applications by Mutual Funds in respect of more than one scheme of the Mutual
Fund provided that the Applications clearly indicate the scheme for which the Bid has
been made.

(iii) Applications by Mutual Funds, and sub-accounts of FIIs (or FIIs and its sub-accounts)
submitted with the same PAN but with different beneficiary account numbers, Client IDs
and DP IDs.

4.3.3 FIELD NUMBER 5: CATEGORY OF APPLICANTS

(a) The categories of applicants identified as per the SEBI ICDR Regulations, 2009 for the purpose of
Bidding, allocation and allotment in the Issue are RIIs, individual applicants other than RII's and
other investors (including corporate bodies or institutions, irrespective of the number of specified
securities applied for).

(b) An Issuer can make reservation for certain categories of Applicants permitted under the SEBI
ICDR Regulations, 2009. For details of any reservations made in the Issue, applicants may refer to
the Prospectus.

(c) The SEBI ICDR Regulations, 2009 specify the allocation or allotment that may be made to
various categories of applicants in an Issue depending upon compliance with the eligibility
conditions. Details pertaining to allocation are disclosed on reverse side of the Revision Form. For
Issue specific details in relation to allocation applicant may refer to the Prospectus.

4.3.4 FIELD NUMBER 6: INVESTOR STATUS

Applicants should refer to instructions contained in paragraphs 4.1.6.

4.3.5 FIELD 7: PAYMENT DETAILS

(a) All Applicants are required to make payment of the full Amount (net of any Discount, as
applicable) along-with the Application Form. If the Discount is applicable in the Issue, the RIIs
should indicate the full Amount in the Application Form and the payment shall be made for an
Amount net of Discount. Only in cases where the Prospectus indicates that part payment may be
made, such an option can be exercised by the Applicant.

(b) RIIs bidding in the Retail Portion can Bid, either through the ASBA mechanism or by paying the
Bid Amount through a cheque or a demand draft ("Non-ASBA Mechanism").

403
 (c) Application Amount cannot be paid in cash, through money order or through postal order or
through stock invest.

4.3.5.1 Instructions for non-ASBA Applicants:

(a) Non-ASBA Applicants may submit their Application Form with the Collection Bank(s).

(b) For Applications made through a Collection Bank(s): The Applicant may, with the submission of
the Application Form, draw a cheque or demand draft for the Bid Amount in favor of the Escrow
Account as specified under the Prospectus and the Application Form and submit the same to the
escrow Collection Bank(s).

(c) If the cheque or demand draft accompanying the Application Form is not made favoring the
Escrow Account, the form is liable to be rejected.

(d) Payments should be made by cheque, or demand draft drawn on any bank (including a cooperative
bank), which is situated at, and is a member of or sub-member of the bankers' clearing house
located at the centre where the Application Form is submitted. Cheques/bank drafts drawn on
banks not participating in the clearing process may not be accepted and applications accompanied
by such cheques or bank drafts are liable to be rejected.

(e) The Escrow Collection Banks shall maintain the monies in the Escrow Account for and on behalf
of the Applicants until the Designated Date.

(f) Applicants are advised to provide the number of the Application Form and PAN on the reverse of
the cheque or bank draft to avoid any possible misuse of instruments submitted.

4.3.5.2 Payment instructions for ASBA Applicants

(a) ASBA Applicants may submit the Application Form in physical mode to the Designated Branch of
an SCSB where the Applicants have ASBA Account.

(b) ASBA Applicants may specify the Bank Account number in the Application Form. The
Application Form submitted by an ASBA Applicant and which is accompanied by cash, demand
draft, money order, postal order or any mode of payment other than blocked amounts in the ASBA
Account maintained with an SCSB, may not be accepted.

(c) Applicants should ensure that the Application Form is also signed by the ASBA Account holder(s)
if the Applicant is not the ASBA Account holder;

(d) Applicants shall note that for the purpose of blocking funds under ASBA facility clearly
demarcated funds shall be available in the account.

(e) From one ASBA Account, a maximum of five Bids cum Application Forms can be submitted.

(f) ASBA Applicants bidding directly through the SCSBs should ensure that the Application Form is
submitted to a Designated Branch of a SCSB where the ASBA Account is maintained.

(g) Upon receipt of the Application Form, the Designated Branch of the SCSB may verify if sufficient
funds equal to the Application Amount are available in the ASBA Account, as mentioned in the
Application Form.

(h) If sufficient funds are available in the ASBA Account, the SCSB may block an amount equivalent
to the Application Amount mentioned in the Application Form and may upload the details on the
Stock Exchange Platform.

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 (i) If sufficient funds are not available in the ASBA Account, the Designated Branch of the SCSB
may not upload such Applications on the Stock Exchange platform and such Applications are
liable to be rejected.

(j) Upon submission of a completed Application Form each ASBA Applicant may be deemed to have
agreed to block the entire Application Amount and authorized the Designated Branch of the SCSB
to block the Application Amount specified in the Application Form in the ASBA Account
maintained with the SCSBs.

(k) The Application Amount may remain blocked in the aforesaid ASBA Account until finalisation of
the Basis of allotment and consequent transfer of the Application Amount against the Allotted
Equity Shares to the Public Issue Account, or until withdrawal or failure of the Issue, or until
withdrawal or rejection of the Application, as the case may be.

(l) SCSBs applying in the Issue must apply through an ASBA Account maintained with any other
SCSB; else their Applications are liable to be rejected.

4.3.5.2.1 Unblocking of ASBA Account

(a) Once the Basis of Allotment is approved by the Designated Stock Exchange, the Registrar to the
Issue may provide the following details to the controlling branches of each SCSB, along with
instructions to unblock the relevant bank accounts and for successful applications transfer the
requisite money to the Public Issue Account designated for this purpose, within the specified
timelines: (i) the number of Equity Shares to be Allotted against each Application, (ii) the amount
to be transferred from the relevant bank account to the Public Issue Account, for each Application,
(iii) the date by which funds referred to in (ii) above may be transferred to the Public Issue
Account, and (iv) details of rejected ASBA Applications, if any, along with reasons for rejection
and details of withdrawn or unsuccessful Applications, if any, to enable the SCSBs to unblock the
respective bank accounts.

(b) On the basis of instructions from the Registrar to the Issue, the SCSBs may transfer the requisite
amount against each successful ASBA Application to the Public Issue Account and may unblock
the excess amount, if any, in the ASBA Account.

(c) In the event of withdrawal or rejection of the Application Form and for unsuccessful Applications,
the Registrar to the Issue may give instructions to the SCSB to unblock the Application Amount in
the relevant ASBA Account within 12 Working Days of the Issue Closing Date.

4.3.5.3 Discount (if applicable)

(a) The Discount is stated in absolute rupee terms.

(b) RIIs, Employees and Retail Individual Shareholders are only eligible for discount. For Discounts
offered in the Issue, applicants may refer to the Prospectus.

(c) The Applicants entitled to the applicable Discount in the Issue may make payment for an amount
i.e. the Application Amount less Discount (if applicable).

4.3.6 FIELD NUMBER 8: SIGNATURES AND OTHER AUTHORISATIONS AND

ACKNOWLEDGEMENT AND FUTURE COMMUNICATION

Applicants should refer to instructions contained in paragraphs 4.1.8 and 4.1.9.

4.4 SUBMISSION OF BID CUM APPLICATION FORM/ REVISION FORM/APPLICATION FORM

4.4.1 Bidders/Applicants may submit completed Bid-cum-application form / Revision Form in the

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 following manner:-

Mode of Application Submission of Bid cum Application Form

Non-ASBA Application (a) To members of the Syndicate at the Specified Locations mentioned in the
Bid cum Application Form

(b) To Registered Brokers

ASBA Application (a) To members of the Syndicate in the Specified Locations or Registered
Brokers at the Broker Centres

(b) To the Designated branches of the SCSBs where the ASBA Account is
maintained

(a) Bidders/Applicants should not submit the bid cum application forms/ Revision Form directly to
the escrow collection banks. Bid cum Application Form/ Revision Form submitted to the escrow
collection banks are liable for rejection.

(b) Bidders/Applicants should submit the Revision Form to the same member of the Syndicate, the
Registered Broker or the SCSB through which such Bidder/Applicant had placed the original Bid.

(c) Upon submission of the Bid-cum-Application Form, the Bidder/Applicant will be deemed to have
authorized the Issuer to make the necessary changes in the RHP and the Bid cum Application
Form as would be required for filing Prospectus with the Registrar of Companies (RoC) and as
would be required by the RoC after such filing, without prior or subsequent notice of such changes
to the relevant Bidder/Applicant.

(d) Upon determination of the Issue Price and filing of the Prospectus with the RoC, the Bid-cum Application
Form will be considered as the application form.

SECTION 5: ISSUE PROCEDURE IN BOOK BUILT ISSUE

Book Building, in the context of the Issue, refers to the process of collection of Bids within the Price Band or above
the Floor Price and determining the Issue Price based on the Bids received as detailed in Schedule XI of SEBI ICDR
Regulations, 2009. The Issue Price is finalised after the Bid/Issue Closing Date. Valid Bids received at or above the
Issue Price are considered for allocation in the Issue, subject to applicable regulations and other terms and
conditions.

5.1 SUBMISSION OF BIDS

(a) During the Bid/Issue Period, ASBA Bidders/Applicants may approach the members of the
Syndicate at the Specified Cities or any of the Registered Brokers or the Designated Branches to
register their Bids. Non-ASBA Bidders/Applicants who are interested in subscribing for the Equity
Shares should approach the members of the Syndicate or any of the Registered Brokers, to register
their Bid.

(b) Non-ASBA Bidders/Applicants (RIIs, Employees and Retail Individual Shareholders) bidding at
Cut-off Price may submit the Bid cum Application Form along with a cheque/demand draft for the
Bid Amount less discount (if applicable) based on the Cap Price with the members of the
Syndicate/ any of the Registered Brokers to register their Bid.

(c) In case of ASBA Bidders/Applicants (excluding NIIs and QIBs) bidding at Cut-off Price, the
ASBA Bidders/Applicants may instruct the SCSBs to block Bid Amount based on the Cap Price
less discount (if applicable). ASBA Bidders/Applicants may approach the members of the
Syndicate or any of the Registered Brokers or the Designated Branches to register their Bids.

(d) For Details of the timing on acceptance and upload of Bids in the Stock Exchanges Platform

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 Bidders/Applicants are requested to refer to the RHP.

5.2 ELECTRONIC REGISTRATION OF BIDS

(a) The Syndicate, the Registered Brokers and the SCSBs may register the Bids using the on-line
facilities of the Stock Exchanges. The Syndicate, the Registered Brokers and the Designated
Branches of the SCSBs can also set up facilities for off-line electronic registration of Bids, subject
to the condition that they may subsequently upload the off-line data file into the online facilities
for Book Building on a regular basis before the closure of the issue.

(b) On the Bid/Issue Closing Date, the Syndicate, the Registered Broker and the Designated Branches
of the SCSBs may upload the Bids till such time as may be permitted by the Stock Exchanges.

(c) Only Bids that are uploaded on the Stock Exchanges Platform are considered for allocation/
Allotment. The members of the Syndicate, the Registered Brokers and the SCSBs are given up to
one day after the Bid/Issue Closing Date to modify select fields uploaded in the Stock Exchange
Platform during the Bid/Issue Period after which the Stock Exchange(s) send the bid information
to the Registrar for validation of the electronic bid details with the Depository's records.

5.3 BUILD UP OF THE BOOK

(a) Bids received from various Bidders/Applicants through the Syndicate, Registered Brokers and the
SCSBs may be electronically uploaded on the Bidding Platform of the Stock Exchanges' on a
regular basis. The book gets built up at various price levels. This information may be available
with the BRLMs at the end of the Bid/Issue Period.

(b) Based on the aggregate demand and price for Bids registered on the Stock Exchanges Platform, a
graphical representation of consolidated demand and price as available on the websites of the
Stock Exchanges may be made available at the bidding centres during the Bid/Issue Period.

5.4 WITHDRAWAL OF BIDS

(a) RIIs can withdraw their Bids until finalization of Basis of Allotment. In case a RII applying
through the ASBA process wishes to withdraw the Bid during the Bid/Issue Period, the same can
be done by submitting a request for the same to the concerned SCSB or the Syndicate Member or
the Registered Broker, as applicable, who shall do the requisite, including unblocking of the funds
by the SCSB in the ASBA Account.

(b) In case a RII wishes to withdraw the Bid after the Bid/Issue Period, the same can be done by
submitting a withdrawal request to the Registrar to the Issue until finalization of Basis of
Allotment. The Registrar to the Issue shall give instruction to the SCSB for unblocking the ASBA
Account on the Designated Date. QIBs and NIIs can neither withdraw nor lower the size of their
Bids at any stage.

5.5 REJECTION AND RESPONSIBILITY FOR UPLOAD OF BIDS

(a) The members of the Syndicate, the Registered Broker and/or SCSBs are individually responsible
for the acts, mistakes or errors or omission in relation to

(i) the Bids accepted by the members of the Syndicate, the Registered Broker and the
SCSBs,

(ii) the Bids uploaded by the members of the Syndicate, the Registered Broker and the
SCSBs,

(iii) the Bid cum application forms accepted but not uploaded by the members of the

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 Syndicate, the Registered Broker and the SCSBs, or

(iv) With respect to Bids by ASBA Bidders/Applicants, Bids accepted and uploaded by
SCSBs without blocking funds in the ASBA Accounts. It may be presumed that for Bids
uploaded by the SCSBs, the Bid Amount has been blocked in the relevant Account.

(b) The BRLMs and their affiliate Syndicate Members, as the case may be, may reject Bids if all the
information required is not provided and the Bid cum Application Form is incomplete in any
respect.

(c) The SCSBs shall have no right to reject Bids, except in case of unavailability of adequate funds in
the ASBA account or on technical grounds.

(d) In case of QIB Bidders, only the (i) SCSBs (for Bids other than the Bids by Anchor Investors); and
(ii) the BRLMs and their affiliate Syndicate Members (only in the specified locations) have the
right to reject bids. However, such rejection shall be made at the time of receiving the Bid and
only after assigning a reason for such rejection in writing.

(e) All bids by QIBs, NIIs and RIIs Bids can be rejected on technical grounds listed herein.

5.5.1 GROUNDS FOR TECHNICAL REJECTIONS

Bid cum Application Forms/Application Form can be rejected on the below mentioned technical grounds
either at the time of their submission to the (i) authorised agents of the BRLMs, (ii) Registered Brokers, or
(iii) SCSBs, or (iv) Collection Bank(s), or at the time of finalisation of the Basis of Allotment.
Bidders/Applicants are advised to note that the Bids/Applications are liable to be rejected, inter-alia, on the
following grounds, which have been detailed at various placed in this GID:-

(a) Bid/Application by persons not competent to contract under the Indian Contract Act, 1872, as
amended, (other than minors having valid Depository Account as per Demographic Details
provided by Depositories);

(b) Bids/Applications by OCBs; and

(c) In case of partnership firms, Bid/Application for Equity Shares made in the name of the firm.
However, a limited liability partnership can apply in its own name;

(d) In case of Bids/Applications under power of attorney or by limited companies, corporate, trust
etc., relevant documents are not being submitted along with the Bid cum application
form/Application Form;

(e) Bids/Applications by persons prohibited from buying, selling or dealing in the shares directly or
indirectly by SEBI or any other regulatory authority;

(f) Bids/Applications by any person outside India if not in compliance with applicable foreign and
Indian laws;

(g) DP ID and Client ID not mentioned in the Bid cum Application Form/Application Form;

(h) PAN not mentioned in the Bid cum Application Form/Application Form except for
Bids/Applications by or on behalf of the Central or State Government and officials appointed by
the court and by the investors residing in the State of Sikkim, provided such claims have been
verified by the Depository Participant;

(i) In case no corresponding record is available with the Depositories that matches the DP ID, the
Client ID and the PAN;

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(j) Bids/Applications for lower number of Equity Shares than the minimum specified for that
category of investors;

(k) Bids/Applications at a price less than the Floor Price and Bids/Applications at a price more than
the Cap Price;

(l) Bids/Applications at Cut-off Price by NIIs and QIBs;

(m) Amount paid does not tally with the amount payable for the highest value of Equity Shares Bid
for. With respect to Bids/Applications by ASBA Bidders, the amounts mentioned in the Bid cum
Application Form/Application Form does not tally with the amount payable for the value of the
Equity Shares Bid/Applied for;

(n) Bids/Applications for amounts greater than the maximum permissible amounts prescribed by the
regulations;

(o) In relation to ASBA Bids/Applications, submission of more than five Bid cum Application
Forms/Application Form as per ASBA Account;

(p) Bids/Applications for a Bid/Application Amount of more than ` 200,000 by RIIs by applying
through non-ASBA process;

(q) Bids/Applications for number of Equity Shares which are not in multiples Equity Shares which are
not in multiples as specified in the RHP;

(r) Multiple Bids/Applications as defined in this GID and the RHP/Prospectus;

(s) Bid cum Application Forms/Application Forms are not delivered by the Bidders/Applicants within
the time prescribed as per the Bid cum Application Forms/Application Form, Bid/Issue Opening
Date advertisement and as per the instructions in the RHP and the Bid cum Application Forms;

(t) With respect to ASBA Bids/Applications, inadequate funds in the bank account to block the
Bid/Application Amount specified in the Bid cum Application Form/ Application Form at the time
of blocking such Bid/Application Amount in the bank account;

(u) Bids/Applications where sufficient funds are not available in Escrow Accounts as per final
certificate from the Escrow Collection Banks;

(v) With respect to ASBA Bids/Applications, where no confirmation is received from SCSB for
blocking of funds;

(w) Bids/Applications by QIBs (other than Anchor Investors) and Non Institutional Bidders not
submitted through ASBA process or Bids/Applications by QIBs (other than Anchor Investors) and
Non Institutional Bidders accompanied with cheque(s) or demand draft(s);

(x) ASBA Bids/Applications submitted to a BRLMs at locations other than the Specified Cities and
Bid cum Application Forms/Application Forms, under the ASBA process, submitted to the Escrow
Collecting Banks (assuming that such bank is not a SCSB where the ASBA Account is
maintained), to the issuer or the Registrar to the Issue;

(y) Bids/Applications not uploaded on the terminals of the Stock Exchanges;

(z) Bids/Applications by SCSBs wherein a separate account in its own name held with any other
SCSB is not mentioned as the ASBA Account in the Bid cum Application Form/Application Form.

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5.6 BASIS OF ALLOCATION

(a) The SEBI ICDR Regulations, 2009 specify the allocation or Allotment that may be made to
various categories of Bidders/Applicants in an Issue depending on compliance with the eligibility
conditions. Certain details pertaining to the percentage of Issue size available for allocation to
each category is disclosed overleaf of the Bid cum Application Form and in the RHP / Prospectus.
For details in relation to allocation, the Bidder/Applicant may refer to the RHP / Prospectus.

(b) Under-subscription in Retail category is allowed to be met with spill-over from any other category
or combination of categories at the discretion of the Issuer and in consultation with the BRLMs
and the Designated Stock Exchange and in accordance with the SEBI ICDR Regulations, 2009.
Unsubscribed portion in QIB category is not available for subscription to other categories.

(c) For allocation in the event of an under-subscription applicable to the Issuer, Bidders/Applicants
may refer to the RHP.

(d) Illustration of the Book Building and Price Discovery Process

Bidders should note that this example is solely for illustrative purposes and is not specific to the
Issue; it also excludes bidding by Anchor Investors.

Bidders can bid at any price within the Price Band. For instance, assume a Price Band of ` 20 to `
24 per share, Issue size of 3,000 Equity Shares and receipt of five Bids from Bidders, details of
which are shown in the table below. The illustrative book given below shows the demand for the
Equity Shares of the Issuer at various prices and is collated from Bids received from various
investors.

Bid Quantity Bid Amount Cumulative Quantity Subscription

(`)
500 24 500 16.67%
1,000 23 1,500 50.00%
1,500 22 3,000 100.00%
2,000 21 5,000 166.67%
2,500 20 7,500 250.00%

The price discovery is a function of demand at various prices. The highest price at which the
Issuer is able to Issue the desired number of Equity Shares is the price at which the book cuts off,
i.e., ` 22.00 in the above example. The Issuer in consultation with the BRLMs may finalise the
Issue Price at or below such Cut-Off Price, i.e., at or below ` 22.00. All Bids at or above this Issue
Price and cut-off Bids are valid Bids and are considered for allocation in the respective categories.

(e) Alternate Method of Book Building

In case of FPOs, Issuers may opt for an alternate method of Book Building in which only the Floor
Price is specified for the purposes of bidding ("Alternate Book Building Process").

The Issuer may specify the Floor Price in the RHP or advertise the Floor Price at least one
Working Day prior to the Bid/Issue Opening Date. QIBs may Bid at a price higher than the Floor
Price and the Allotment to the QIBs is made on a price priority basis. The Bidder with the highest
Bid Amount is allotted the number of Equity Shares Bid for and then the second highest Bidder is
Allotted Equity Shares and this process continues until all the Equity Shares have been allotted.
RIIs, NIIs and Employees are Allotted Equity Shares at the Floor Price and allotment to these
categories of Bidders is made proportionately. If the number of Equity Shares Bid for at a price is
more than available quantity then the allotment may be done on a proportionate basis. Further, the
Issuer may place a cap either in terms of number of specified securities or percentage of issued
capital of the Issuer that may be allotted to a single Bidder, decide whether a Bidder be allowed to

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 revise the bid upwards or downwards in terms of price and/or quantity and also decide whether a
Bidder be allowed single or multiple bids.

SECTION 6: ISSUE PROCEDURE IN FIXED PRICE ISSUE

Applicants may note that there is no Bid cum Application Form in a Fixed Price Issue. As the Issue Price is
mentioned in the Fixed Price Issue therefore on filing of the Prospectus with the RoC, the Application so submitted
is considered as the application form.

Applicants may only use the specified Application Form for the purpose of making an Application in terms of the
Prospectus which may be submitted through Syndicate Members/SCSB and/or Bankers to the Issue or Registered
Broker.

ASBA Applicants may submit an Application Form either in physical form to the Syndicate Members or Registered
Brokers or the Designated Branches of the SCSBs or in the electronic form to the SCSB or the Designated Branches
of the SCSBs authorising blocking of funds that are available in the bank account specified in the Application Form
only ("ASBA Account"). The Application Form is also made available on the websites of the Stock Exchanges at
least one day prior to the Bid/Issue Opening Date.

In a fixed price Issue, allocation in the net offer to the public category is made as follows: minimum fifty per cent to
Retail Individual Investors; and remaining to (i) individual investors other than Retail Individual Investors; and (ii)
other Applicants including corporate bodies or institutions, irrespective of the number of specified securities applied
for. The unsubscribed portion in either of the categories specified above may be allocated to the Applicants in the
other category.

For details of instructions in relation to the Application Form, Bidders/Applicants may refer to the relevant section
the GID.

SECTION 7: ALLOTMENT PROCEDURE AND BASIS OF ALLOTMENT

The allotment of Equity Shares to Bidders/Applicants other than Retail Individual Investors and Anchor Investors
may be on proportionate basis. For Basis of Allotment to Anchor Investors, Bidders/Applicants may refer to
RHP/Prospectus. No Retail Individual Investor is will be allotted less than the minimum Bid Lot subject to
availability of shares in Retail Individual Investor Category and the remaining available shares, if any will be
allotted on a proportionate basis. The Issuer is required to receive a minimum subscription of 90% of the Issue
(excluding any Offer for Sale of specified securities). However, in case the Issue is in the nature of Offer for Sale
only, then minimum subscription may not be applicable.

7.1 ALLOTMENT TO RIIs

Bids received from the RIIs at or above the Issue Price may be grouped together to determine the total
demand under this category. If the aggregate demand in this category is less than or equal to the Retail
Category at or above the Issue Price, full Allotment may be made to the RIIs to the extent of the valid Bids.
If the aggregate demand in this category is greater than the allocation to in the Retail Category at or above
the Issue Price, then the maximum number of RIIs who can be Allotted the minimum Bid Lot will be
computed by dividing the total number of Equity Shares available for Allotment to RIIs by the minimum
Bid Lot ("Maximum RII Allottees"). The Allotment to the RIIs will then be made in the following manner:

(a) In the event the number of RIIs who have submitted valid Bids in the Issue is equal to or less than
Maximum RII Allottees, (i) all such RIIs shall be Allotted the minimum Bid Lot; and (ii) the
balance available Equity Shares, if any, remaining in the Retail Category shall be Allotted on a
proportionate basis to the RIIs who have received Allotment as per (i) above for the balance
demand of the Equity Shares Bid by them (i.e. who have Bid for more than the minimum Bid Lot).

(b) In the event the number of RIIs who have submitted valid Bids in the Issue is more than
Maximum RII Allottees, the RIIs (in that category) who will then be allotted minimum Bid Lot

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 shall be determined on the basis of draw of lots.

7.2 ALLOTMENT TO NIIs

Bids received from NIIs at or above the Issue Price may be grouped together to determine the total demand
under this category. The allotment to all successful NIIs may be made at or above the Issue Price. If the
aggregate demand in this category is less than or equal to the Non-Institutional Category at or above the
Issue Price, full allotment may be made to NIIs to the extent of their demand. In case the aggregate demand
in this category is greater than the Non-Institutional Category at or above the Issue Price, allotment may be
made on a proportionate basis up to a minimum of the Non-Institutional Category.

7.3 ALLOTMENT TO QIBs

For the Basis of Allotment to Anchor Investors, Bidders/Applicants may refer to the SEBI ICDR
Regulations, 2009 or RHP / Prospectus. Bids received from QIBs bidding in the QIB Category (net of
Anchor Portion) at or above the Issue Price may be grouped together to determine the total demand under
this category. The QIB Category may be available for allotment to QIBs who have Bid at a price that is
equal to or greater than the Issue Price. Allotment may be undertaken in the following manner:

(a) In the first instance allocation to Mutual Funds for up to 5% of the QIB Category may be
determined as follows: (i) In the event that Bids by Mutual Fund exceeds 5% of the QIB Category,
allocation to Mutual Funds may be done on a proportionate basis for up to 5% of the QIB
Category; (ii) In the event that the aggregate demand from Mutual Funds is less than 5% of the
QIB Category then all Mutual Funds may get full allotment to the extent of valid Bids received
above the Issue Price; and (iii) Equity Shares remaining unsubscribed, if any and not allocated to
Mutual Funds may be available for allotment to all QIBs as set out at paragraph 7.4(b) below;

(b) In the second instance, allotment to all QIBs may be determined as follows: (i) In the event of
oversubscription in the QIB Category, all QIBs who have submitted Bids above the Issue Price
may be Allotted Equity Shares on a proportionate basis for up to 95% of the QIB Category; (ii)
Mutual Funds, who have received allocation as per (a) above, for less than the number of Equity
Shares Bid for by them, are eligible to receive Equity Shares on a proportionate basis along with
other QIBs; and (iii) Under-subscription below 5% of the QIB Category, if any, from Mutual
Funds, may be included for allocation to the remaining QIBs on a proportionate basis.

7.4 ALLOTMENT TO ANCHOR INVESTOR (IF APPLICABLE)

(a) Allocation of Equity Shares to Anchor Investors at the Anchor Investor Issue Price will be at the
discretion of the Issuer in consultation with the BRLMs, subject to compliance with the following
requirements:

(i) not more than 60% of the QIB Portion will be allocated to Anchor Investors;

(ii) one-third of the Anchor Investor Portion shall be reserved for domestic Mutual Funds,
subject to valid Bids being received from domestic Mutual Funds at or above the price at
which allocation is being done to other Anchor Investors; and

(iii) allocation to Anchor Investors shall be on a discretionary basis and subject to:

 a maximum number of two Anchor Investors for allocation up to ` 10 crores;

 a minimum number of two Anchor Investors and maximum number of 15
Anchor Investors for allocation of more than ` 10 crores and up to ` 250 crores
subject to minimum allotment of ` 5 crores per such Anchor Investor; and
 a minimum number of five Anchor Investors and maximum number of 25
Anchor Investors for allocation of more than ` 250 crores subject to minimum
allotment of ` 5 crores per such Anchor Investor.

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 (b) A physical book is prepared by the Registrar on the basis of the Bid cum Application Forms
received from Anchor Investors. Based on the physical book and at the discretion of the Issuer, in
consultation with the BRLMs, selected Anchor Investors will be sent a CAN and if required, a
revised CAN.

(c) In the event that the Issue Price is higher than the Anchor Investor Issue Price: Anchor
Investors will be sent a revised CAN within one day of the Pricing Date indicating the number of
Equity Shares allocated to such Anchor Investor and the pay-in date for payment of the balance
amount. Anchor Investors are then required to pay any additional amounts, being the difference
between the Issue Price and the Anchor Investor Issue Price, as indicated in the revised CAN
within the pay-in date referred to in the revised CAN. Thereafter, the Allotment Advice will be
issued to such Anchor Investors.

(d) In the event the Issue Price is lower than the Anchor Investor Issue Price: Anchor Investors
who have been Allotted Equity Shares will directly receive Allotment Advice.

7.5 ALLOTMENT TO EMPLOYEE RESERVATION PORTION

(a) The Bid must be for a minimum of [●] Equity Shares and in multiples of [●] Equity Shares
thereafter, so as to ensure that the Bid Amount payable by the Eligible Employees does not exceed
` 200,000. The Allotment in the Employee Reservation Portion will be on a proportionate basis.
Bidders under the Employee Reservation Portion may Bid at Cut-off Price.

(b) Bids received from the Eligible Employees at or above the Issue Price shall be grouped together to
determine the total demand under this category. The allocation to all the successful Eligible
Employees will be made at the Issue Price.

(c) If the aggregate demand in this category is less than or equal to [●] Equity Shares at or above the
Issue Price, full allocation shall be made to the Employees to the extent of their demand. Under-
subscription, if any, in the Employee Reservation Portion will be added back to the Net Issue.

(d) If the aggregate demand in this category is greater than [●] Equity Shares at or above the Issue
Price, the allocation shall be made on a proportionate basis up to a minimum of [●] Equity Shares
and in multiple of one Equity Share thereafter. For the method of proportionate basis of allocation,
refer below.

(e) Only Eligible Employees can apply under Employee Reservation Portion.

7.6 BASIS OF ALLOTMENT FOR QIBs (OTHER THAN ANCHOR INVESTORS) AND NIIs IN CASE
OF OVER-SUBSCRIBED ISSUE

In the event of the Issue being over-subscribed, the Issuer may finalise the Basis of Allotment in
consultation with the Designated Stock Exchange in accordance with the SEBI ICDR Regulations, 2009.

The allocation may be made in marketable lots, on a proportionate basis as explained below:

(a) Bidders may be categorized according to the number of Equity Shares applied for;

(b) The total number of Equity Shares to be Allotted to each category as a whole may be arrived at on
a proportionate basis, which is the total number of Equity Shares applied for in that category
(number of Bidders in the category multiplied by the number of Equity Shares applied for)
multiplied by the inverse of the over-subscription ratio;

(c) The number of Equity Shares to be Allotted to the successful Bidders may be arrived at on a
proportionate basis, which is total number of Equity Shares applied for by each Bidder in that

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 category multiplied by the inverse of the over-subscription ratio;

(d) In all Bids where the proportionate allotment is less than the minimum bid lot decided per Bidder,
the allotment may be made as follows: the successful Bidders out of the total Bidders for a
category may be determined by a draw of lots in a manner such that the total number of Equity
Shares Allotted in that category is equal to the number of Equity Shares calculated in accordance
with (b) above; and each successful Bidder may be Allotted a minimum of such Equity Shares
equal to the minimum Bid Lot finalised by the Issuer;

(e) If the proportionate allotment to a Bidder is a number that is more than the minimum Bid lot but is
not a multiple of one (which is the marketable lot), the decimal may be rounded off to the higher
whole number if that decimal is 0.5 or higher. If that number is lower than 0.5 it may be rounded
off to the lower whole number. Allotment to all bidders in such categories may be arrived at after
such rounding off; and

(f) If the Equity Shares allocated on a proportionate basis to any category are more than the Equity
Shares Allotted to the Bidders in that category, the remaining Equity Shares available for allotment
may be first adjusted against any other category, where the Allotted Equity Shares are not
sufficient for proportionate allotment to the successful Bidders in that category. The balance
Equity Shares, if any, remaining after such adjustment may be added to the category comprising
Bidders applying for minimum number of Equity Shares.

7.7 DESIGNATED DATE AND ALLOTMENT OF EQUITY SHARES

(a) Designated Date: On the Designated Date, the Escrow Collection Banks shall transfer the funds
represented by allocation of Equity Shares (other than ASBA funds with the SCSBs) from the
Escrow Account, as per the terms of the Escrow Agreement, into the Public Issue Account with the
Bankers to the Issue. The balance amount after transfer to the Public Issue Account shall be
transferred to the Refund Account. Payments of refund to the Bidders shall also be made from the
Refund Account as per the terms of the Escrow Agreement and the RHP.

(b) Issuance of Allotment Advice: Upon approval of the Basis of Allotment by the Designated Stock
Exchange, the Registrar shall upload the same on its website. On the basis of the approved Basis
of Allotment, the Issuer shall pass necessary corporate action to facilitate the Allotment and credit
of Equity Shares. Bidders/Applicants are advised to instruct their Depository Participant to
accept the Equity Shares that may be allotted to them pursuant to the Issue.

Pursuant to confirmation of such corporate actions, the Registrar will dispatch Allotment Advice
to the Bidders/Applicants who have been Allotted Equity Shares in the Issue.

(c) The dispatch of Allotment Advice shall be deemed a valid, binding and irrevocable contract.

(d) Issuer will ensure that: (i) the Allotment of Equity Shares; and (ii) credit of shares to the successful
Bidders/Applicants Depository Account will be completed within 12 Working Days of the Bid/
Issue Closing Date. The Issuer also ensures the credit of shares to the successful Applicant's
depository account is completed within two Working Days from the date of Allotment, after the
funds are transferred from the Escrow Account to the Public Issue Account on the Designated
Date.

SECTION 8: INTEREST AND REFUNDS

8.1 COMPLETION OF FORMALITIES FOR LISTING AND COMMENCEMENT OF TRADING

The Issuer may ensure that all steps for the completion of the necessary formalities for listing and
commencement of trading at all the Stock Exchanges are taken within 12 Working Days of the Bid/Issue
Closing Date. The Registrar to the Issue may give instructions for credit to Equity Shares the beneficiary

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 account with DPs, and dispatch the Allotment Advice within 12 Working Days of the Bid/Issue Closing
Date.

8.2 GROUNDS FOR REFUND

8.2.1 NON RECEIPT OF LISTING PERMISSION

An Issuer makes an application to the Stock Exchange(s) for permission to deal in/list and for an official
quotation of the Equity Shares. All the Stock Exchanges from where such permission is sought are
disclosed in RHP/Prospectus. The Designated Stock Exchange may be as disclosed in the RHP/Prospectus
with which the Basis of Allotment may be finalised.

If the Issuer fails to make application to the Stock Exchange(s) and obtain permission for listing of the
Equity Shares, in accordance with the provisions of Section 40 of the Companies Act, 2013, the Issuer may
be punishable with a fine which shall not be less than five lakh rupees but which may extend to fifty lakh
rupees and every officer of the Issuer who is in default shall be punishable with imprisonment for a term
which may extend to one year or with fine which shall not be less than fifty thousand rupees but which may
extend to three lakh rupees, or with both.

If the permissions to deal in and for an official quotation of the Equity Shares are not granted by any of the
Stock Exchange(s), the Issuer may forthwith repay, without interest, all moneys received from the
Bidders/Applicants in pursuance of the RHP/Prospectus. If such money is not repaid within the prescribed
time after the Issuer becomes liable to repay it, then the Issuer and every director of the Issuer who is an
officer in default may, on and from such expiry of such period, be liable to repay the money, with interest
at such rate, as disclosed in the RHP/Prospectus.

8.2.2 NON RECEIPT OF MINIMUM SUBSCIPTION

If the Issuer does not receive a minimum subscription of 90% of the Issue (excluding any offer for sale of
specified securities), including devolvement to the Underwriters, within 60 days from the Bid/Issue Closing
Date, the Issuer may forthwith, without interest refund the entire subscription amount received in a manner
prescribed under the SEBI ICDR Regulations, the Companies Act, 2013 and other applicable laws. In case
the Issue is in the nature of Offer for Sale only, then minimum subscription may not be applicable. If there
is a delay beyond the prescribed time, then the Issuer and every director of the Issuer who is an officer in
default may be liable to repay the money, with interest at the rate of 15% per annum.

8.2.3 MINIMUM NUMBER OF ALLOTTEES

The Issuer may ensure that the number of prospective Allottees to whom Equity Shares may be allotted
may not be less than 1,000 failing which the entire application monies may be refunded forthwith.

8.2.4 IN CASE OF ISSUES MADE UNDER COMPULSORY BOOK BUILDING

In case an Issuer not eligible under Regulation 26(1) of the SEBI ICDR Regulations, 2009 comes for an
Issue under Regulation 26(2) of SEBI (ICDR) Regulations, 2009 but fails to allot at least 75% of the Issue
to QIBs, in such case full subscription money is to be refunded.

8.3 MODE OF REFUND

(a) In case of ASBA Bids/Applications: Within 12 Working Days of the Bid/Issue Closing Date, the
Registrar to the Issue may give instructions to SCSBs for unblocking the amount in ASBA
Account on unsuccessful Bid/Application and also for any excess amount blocked on
Bidding/Application.

(b) In case of Non-ASBA Bid/Applications: Within 12 Working Days of the Bid/Issue Closing Date,
the Registrar to the Issue may dispatch the refund orders for all amounts payable to unsuccessful

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 Bidders/Applicants and also for any excess amount paid on Bidding/Application, after adjusting
for allocation/ allotment to Bidders/Applicants.

(c) In case of non-ASBA Bidders/Applicants, the Registrar to the Issue may obtain from the
depositories the Bidders/Applicants' bank account details, including the MICR code, on the basis
of the DP ID, Client ID and PAN provided by the Bidders/Applicants in their Bid cum Application
Forms for refunds. Accordingly, Bidders/Applicants are advised to immediately update their
details as appearing on the records of their DPs. Failure to do so may result in delays in dispatch
of refund orders or refunds through electronic transfer of funds, as applicable, and any such delay
may be at the Bidders/Applicants' sole risk and neither the Issuer, the Registrar to the Issue, the
Escrow Collection Banks, or the Syndicate, may be liable to compensate the Bidders/Applicants
for any losses caused to them due to any such delay, or liable to pay any interest for such delay.
Please note that refunds, on account of our Bank not receiving the minimum subscription of 90%
of the Issue, shall be credited only to the bank account from which the Bid Amount was remitted
to the Escrow Bank.

(d) In the case of Bids from Eligible NRIs, FIIs and FPIs, refunds, if any, may generally be payable in
Indian Rupees only and net of bank charges and/or commission. If so desired, such payments in
Indian Rupees may be converted into U.S. Dollars or any other freely convertible currency as may
be permitted by the RBI at the rate of exchange prevailing at the time of remittance and may be
dispatched by registered post. The Issuer may not be responsible for loss, if any, incurred by the
Bidder/Applicant on account of conversion of foreign currency.

8.3.1 Mode of making refunds for Bidders/Applicants other than ASBA Bidders/Applicants

The payment of refund, if any, may be done through various modes as mentioned below:

(a) NECS—Payment of refund may be done through NECS for Bidders/Applicants having an account
at any of the centres specified by the RBI. This mode of payment of refunds may be subject to
availability of complete bank account details including the nine-digit MICR code of the
Bidder/Applicant as obtained from the Depository;

(b) NEFT— Payment of refund may be undertaken through NEFT wherever the branch of the
Bidders/Applicants' bank is NEFT enabled and has been assigned the Indian Financial System
Code ("IFSC"), which can be linked to the MICR of that particular branch. The IFSC Code may
be obtained from the website of RBI as at a date prior to the date of payment of refund, duly
mapped with MICR numbers. Wherever the Bidders/Applicants have registered their nine-digit
MICR number and their bank account number while opening and operating the demat account, the
same may be duly mapped with the IFSC Code of that particular bank branch and the payment of
refund may be made to the Bidders/Applicants through this method. In the event NEFT is not
operationally feasible, the payment of refunds may be made through any one of the other modes as
discussed in this section;

(c) Direct Credit— Bidders/Applicants having their bank account with the Refund Banker may be
eligible to receive refunds, if any, through direct credit to such bank account;

(d) RTGS— Bidders/Applicants having a bank account at any of the centres notified by SEBI where
clearing houses are managed by the RBI, may have the option to receive refunds, if any, through
RTGS; and

(e) For all the other Bidders/Applicants, including Bidders/Applicants who have not updated their
bank particulars along with the nine-digit MICR code, the refund orders may be dispatched
through speed post or registered post for refund orders. Such refunds may be made by cheques,
pay orders or demand drafts drawn on the Refund Bank and payable at par at places where Bids
are received. Please note that refunds, on account of our Bank not receiving the minimum
subscription of 90% of the Issue, shall be credited only to the bank account from which the Bid

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 Amount was remitted to the Escrow Bank.

For details of levy of charges, if any, for any of the above methods, Bank charges, if any, for
cashing such cheques, pay orders or demand drafts at other centres etc Bidders/Applicants may
refer to RHP/Prospectus.

8.3.2 Mode of making refunds for ASBA Bidders/Applicants

In case of ASBA Bidders/Applicants, the Registrar to the Issue may instruct the controlling branch of the
SCSB to unblock the funds in the relevant ASBA Account for any withdrawn, rejected or unsuccessful
ASBA Bids or in the event of withdrawal or failure of the Issue.

8.4 INTEREST IN CASE OF DELAY IN ALLOTMENT OR REFUND

The Issuer may pay interest at rates prescribed under applicable laws if refund orders are not dispatched or
if, in a case where the refund or portion thereof is made in electronic manner, the refund instructions have
not been given to the clearing system in the disclosed manner and/or demat credits are not made to
Bidders/Applicants or instructions for unblocking of funds in the ASBA Account are not dispatched within
the 12 Working days of the Bid/Issue Closing Date.

SECTION 9: GLOSSARY AND ABBREVIATIONS

Unless the context otherwise indicates or implies, certain definitions and abbreviations used in this document may
have the meaning as provided below. References to any legislation, act or regulation may be to such legislation, act
or regulation as amended from time to time.

Term Description
Allotment/ Allot/ Allotted The allotment of Equity Shares pursuant to the Issue to successful Bidders/Applicants
Allottee An Bidder/Applicant to whom the Equity Shares are Allotted
Allotment Advice Note or advice or intimation of Allotment sent to the Bidders/Applicants who have been
allotted Equity Shares after the Basis of Allotment has been approved by the designated
Stock Exchanges
Anchor Investor A Qualified Institutional Buyer, applying under the Anchor Investor Portion in accordance
with the requirements specified in SEBI ICDR Regulations, 2009.
Anchor Investor Portion Up to 60% of the QIB Category which may be allocated by the Issuer, in consultation with
the BRLMs, to Anchor Investors on a discretionary basis. One-third of the Anchor Investor
Portion is reserved for domestic Mutual Funds, subject to valid Bids being received from
domestic Mutual Funds at or above the price at which allocation is being done to Anchor
Investors
Application Form The form in terms of which the Applicant should make an application for Allotment in case
of issues other than Book Built Issues, includes Fixed Price Issue
Application Supported by An application, whether physical or electronic, used by Bidders/Applicants to make a Bid
Blocked Amount/ authorising an SCSB to block the Bid Amount in the specified bank account maintained with
(ASBA)/ASBA such SCSB.
ASBA Account Account maintained with an SCSB which may be blocked by such SCSB to the extent of the
Bid Amount of the ASBA Bidder/Applicant
ASBA Bid A Bid made by an ASBA Bidder
ASBA Bidder/Applicant Prospective Bidders/Applicants in the Issue who Bid/apply through ASBA
Banker(s) to the Issue/ Escrow The banks which are clearing members and registered with SEBI as Banker to the Issue with
Collection Bank(s)/ Collecting whom the Escrow Account(s) may be opened, and as disclosed in the RHP/Prospectus and
Banker Bid cum Application Form of the Issuer
Basis of Allotment The basis on which the Equity Shares may be Allotted to successful Bidders/Applicants
under the Issue
Bid An indication to make an offer during the Bid/Issue Period by a prospective Bidder pursuant
to submission of Bid cum Application Form or during the Anchor Investor Bid/Issue Period
by the Anchor Investors, to subscribe for or purchase the Equity Shares of the Issuer at a
price within the Price Band, including all revisions and modifications thereto. In case of
issues undertaken through the fixed price process, all references to a Bid should be construed

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 Term Description
to mean an Application
Bid /Issue Closing Date The date after which the Syndicate, Registered Brokers and the SCSBs may not accept any
Bids for the Issue, which may be notified in an English national daily, a Hindi national daily
and a regional language newspaper at the place where the registered office of the Issuer is
situated, each with wide circulation. Applicants/bidders may refer to the RHP/Prospectus for
the Bid/ Issue Closing Date
Bid/Issue Opening Date The date on which the Syndicate and the SCSBs may start accepting Bids for the Issue,
which may be the date notified in an English national daily, a Hindi national daily and a
regional language newspaper at the place where the registered office of the Issuer is situated,
each with wide circulation. Applicants/bidders may refer to the RHP/Prospectus for the Bid/
Issue Opening Date
Bid/Issue Period Except in the case of Anchor Investors (if applicable), the period between the Bid/Issue
Opening Date and the Bid/Issue Closing Date inclusive of both days and during which
prospective Bidders/Applicants (other than Anchor Investors) can submit their Bids,
inclusive of any revisions thereof. The Issuer may consider closing the Bid/ Issue Period for
QIBs one working day prior to the Bid/Issue Closing Date in accordance with the SEBI
ICDR Regulations, 2009. Applicants/bidders may refer to the RHP/Prospectus for the Bid/
Issue Period
Bid Amount The highest value of the optional Bids indicated in the Bid cum Application Form and
payable by the Bidder/Applicant upon submission of the Bid (except for Anchor Investors),
less discounts (if applicable). In case of issues undertaken through the fixed price process, all
references to the Bid Amount should be construed to mean the Application Amount
Bid cum Application Form The form in terms of which the Bidder/Applicant should make an offer to subscribe for or
purchase the Equity Shares and which may be considered as the application for Allotment for
the purposes of the Prospectus, whether applying through the ASBA or otherwise. In case of
issues undertaken through the fixed price process, all references to the Bid cum Application
Form should be construed to mean the Application Form
Bidder/Applicant Any prospective investor (including an ASBA Bidder/Applicant) who makes a Bid pursuant
to the terms of the RHP/Prospectus and the Bid cum Application Form. In case of issues
undertaken through the fixed price process, all references to a Bidder/Applicant should be
construed to mean an Bidder/Applicant
Book Built Process/ Book The book building process as provided under SEBI ICDR Regulations, 2009, in terms of
Building Process/ Book Building which the Issue is being made
Method
Broker Centres Broker centres notified by the Stock Exchanges, where Bidders/Applicants can submit the
Bid cum Application Forms/Application Form to a Registered Broker. The details of such
broker centres, along with the names and contact details of the Registered Brokers are
available on the websites of the Stock Exchanges.
BRLMs/ Book Running Lead The Book Running Lead Managers to the Issue as disclosed in the RHP/Prospectus and the
Managers/Lead Managers/ LMs Bid cum Application Form of the Issuer. In case of issues undertaken through the fixed price
process, all references to the Book Running Lead Managers should be construed to mean the
Lead Managers or LM
Business Day Monday to Friday (except public holidays)
CAN/Confirmation of Allotment The note or advice or intimation sent to each successful Bidder/Applicant indicating the
Note Equity Shares which may be Allotted, after approval of Basis of Allotment by the Designated
Stock Exchange
Cap Price The higher end of the Price Band, above which the Issue Price and the Anchor Investor Issue
Price may not be finalised and above which no Bids may be accepted
Client ID Client Identification Number maintained with one of the Depositories in relation to demat
account
Category III FPI FPIs who are registered as “Category III foreign portfolio investors” under the Securities and
Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014.
Companies Act The Companies Act, 1956
Cut-off Price Issue Price, finalised by the Issuer in consultation with the Book Running Lead Managers,
which can be any price within the Price Band. Only RIIs, Retail Individual Shareholders and
employees are entitled to Bid at the Cut-off Price. No other category of Bidders/Applicants
are entitled to Bid at the Cut-off Price
DP Depository Participant
DP ID Depository Participant's Identification Number
Depositories National Securities Depository Limited and Central Depository Services (India) Limited

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 Term Description
Demographic Details Details of the Bidders/Applicants including the Bidder/Applicant's address, name of the
Applicant's father/husband, investor status, occupation and bank account details
Designated Branches Such branches of the SCSBs which may collect the Bid cum Application Forms used by the
ASBA Bidders/Applicants applying through the ASBA and a list of which is available on
http://www.sebi.gov.in/cms/sebi_data/attachdocs/1316087201341.html
Designated Date The date on which funds are transferred by the Escrow Collection Bank(s) from the Escrow
Account or the amounts blocked by the SCSBs are transferred from the ASBA Accounts, as
the case may be, to the Public Issue Account or the Refund Account, as appropriate, after the
Prospectus is filed with the RoC, following which the board of directors may Allot Equity
Shares to successful Bidders/Applicants in the fresh Issue may give delivery instructions for
the transfer of the Equity Shares constituting the Offer for Sale
Designated Stock Exchange The designated stock exchange as disclosed in the RHP/Prospectus of the Issuer
Discount Discount to the Issue Price that may be provided to Bidders/Applicants in accordance with
the SEBI ICDR Regulations, 2009.
Draft Prospectus The draft prospectus filed with SEBI in case of Fixed Price Issues and which may mention a
price or a Price Band
Employees Employees of an Issuer as defined under SEBI ICDR Regulations, 2009 and including, in
case of a new company, persons in the permanent and full time employment of the promoting
companies excluding the promoters and immediate relatives of the promoter. For further
details Bidder/Applicant may refer to the RHP/Prospectus
Equity Shares Equity shares of the Issuer
Escrow Account Account opened with the Escrow Collection Bank(s) and in whose favour the
Bidders/Applicants (excluding the ASBA Bidders/Applicants) may Issue cheques or drafts in
respect of the Bid Amount when submitting a Bid
Escrow Agreement Agreement to be entered into among the Issuer, the Registrar to the Issue, the Book Running
Lead Managers, the Syndicate Member(s), the Escrow Collection Bank(s) and the Refund
Bank(s) for collection of the Bid Amounts and where applicable, remitting refunds of the
amounts collected to the Bidders/Applicants (excluding the ASBA Bidders/Applicants) on
the terms and conditions thereof
Escrow Collection Bank(s) Refer to definition of Banker(s) to the Issue
FCNR Account Foreign Currency Non-Resident Account
First Bidder/Applicant The Bidder/Applicant whose name appears first in the Bid cum Application Form or
Revision Form
FII(s) Foreign Institutional Investors as defined under SEBI (Foreign Institutional Investors)
Regulations, 1995 and registered with SEBI under applicable laws in India
Fixed Price Issue/Fixed Price The Fixed Price process as provided under SEBI ICDR Regulations, 2009, in terms of which
Process/Fixed Price Method the Issue is being made
Floor Price The lower end of the Price Band, at or above which the Issue Price and the Anchor Investor
Issue Price may be finalised and below which no Bids may be accepted, subject to any
revision thereto
FPI(s) Foreign portfolio investor registered under the Securities and Exchange Board of India
(Foreign Portfolio Investors) Regulations, 2014.
FPO Further public offering
Foreign Venture Capital Foreign Venture Capital Investors as defined and registered with SEBI under the SEBI
Investors or FVCIs (Foreign Venture Capital Investors) Regulations, 2000
IPO Initial public offering
Issue Public Issue of Equity Shares of the Issuer including the Offer for Sale
Issuer/ Bank / Company The Issuer proposing the initial public offering/further public offering as applicable
Issue Price The final price, less discount (if applicable) at which the Equity Shares may be Allotted in
terms of the Prospectus. The Issue Price may be decided by the Issuer in consultation with
the Book Running Lead Managers
Maximum RII Allottees The maximum number of RIIs who can be allotted the minimum Bid Lot. This is computed
by dividing the total number of Equity Shares available for Allotment to RIIs by the
minimum Bid Lot.
MICR Magnetic Ink Character Recognition - nine-digit code as appearing on a cheque leaf
Mutual Fund A mutual fund registered with SEBI under the SEBI (Mutual Funds) Regulations, 1996
Mutual Funds Portion 5% of the QIB Category (excluding the Anchor Investor Portion) available for allocation to
Mutual Funds only, being such number of equity shares as disclosed in the RHP/Prospectus
and Bid cum Application Form

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 Term Description
NECS National Electronic Clearing Service
NEFT National Electronic Fund Transfer
NRE Account Non-Resident External Account
NRI NRIs from such jurisdictions outside India where it is not unlawful to make an offer or
invitation under the Issue and in relation to whom the RHP/Prospectus constitutes an
invitation to subscribe to or purchase the Equity Shares
NRO Account Non-Resident Ordinary Account
Non-Institutional Investors or All Bidders/Applicants, including sub accounts of FIIs registered with SEBI which are
NIIs foreign corporate or foreign individuals and Category III FPIs that are not QIBs or RIBs and
who have Bid for Equity Shares for an amount of more than ` 200,000 (but not including
NRIs other than Eligible NRIs)
Non-Institutional Category The portion of the Issue being such number of Equity Shares available for allocation to NIIs
on a proportionate basis and as disclosed in the RHP/Prospectus and the Bid cum Application
Form
Non-Resident A person resident outside India, as defined under FEMA and includes Eligible NRIs, FPIs,
FIIs and FVCIs
OCB/Overseas Corporate A company, partnership, society or other corporate body owned directly or indirectly to the
Body extent of at least 60% by NRIs including overseas trusts, in which not less than 60% of
beneficial interest is irrevocably held by NRIs directly or indirectly and which was in
existence on October 3, 2003 and immediately before such date had taken benefits under the
general permission granted to OCBs under FEMA
Offer for Sale Public offer of such number of Equity Shares as disclosed in the RHP/Prospectus through an
offer for sale by the selling shareholders
Other Investors Investors other than Retail Individual Investors in a Fixed Price Issue. These include
individual applicants other than retail individual investors and other investors including
corporate bodies or institutions irrespective of the number of specified securities applied for.
PAN Permanent Account Number allotted under the Income Tax Act, 1961
Price Band Price Band with a minimum price, being the Floor Price and the maximum price, being the
Cap Price and includes revisions thereof. The Price Band and the minimum Bid lot size for
the Issue may be decided by the Issuer in consultation with the Book Running Lead
Managers and advertised, at least two working days in case of an IPO and one working day
in case of FPO, prior to the Bid/ Issue Opening Date, in English national daily, Hindi national
daily and regional language at the place where the registered office of the Issuer is situated,
newspaper each with wide circulation
Pricing Date The date on which the Issuer in consultation with the Book Running Lead Managers, finalise
the Issue Price
Prospectus The prospectus to be filed with the RoC in accordance with Section 60 of the Companies Act
after the Pricing Date, containing the Issue Price ,the size of the Issue and certain other
information
Public Issue Account An account opened with the Banker to the Issue to receive monies from the Escrow Account
and from the ASBA Accounts on the Designated Date
QIB Category The portion of the Issue being such number of Equity Shares to be Allotted to QIBs on a
proportionate basis
Qualified Institutional Buyers or As defined under SEBI ICDR Regulations, 2009
QIBs
RTGS Real Time Gross Settlement
Red Herring Prospectus/ RHP The red herring prospectus issued in accordance with Section 32 of the Companies Act, 2013
which does not have complete particulars of the price at which the Equity Shares are offered
and the size of the Issue. The RHP may be filed with the RoC at least three days before the
Bid/Issue Opening Date and may become a Prospectus upon filing with the RoC after the
Pricing Date. In case of issues undertaken through the fixed price process, all references to
the RHP should be construed to mean the Prospectus
Refund Account(s) The account opened with Refund Bank(s), from which refunds (excluding refunds to ASBA
Bidders/Applicants), if any, of the whole or part of the Bid Amount may be made
Refund Bank(s) Refund bank(s) as disclosed in the RHP/Prospectus and Bid cum Application Form of the
Issuer
Refunds through electronic Refunds through NECS, Direct Credit, NEFT, RTGS or ASBA, as applicable
transfer of funds
Registered Broker Stock Brokers registered with the Stock Exchanges having nationwide terminals, other than

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 Term Description
the members of the Syndicate
Registrar to the Issue/RTI The Registrar to the Issue as disclosed in the RHP/Prospectus and Bid cum Application Form
Retail Individual Investors / RIIs Investors who applies or bids for a value of not more than ` 200,000.
Retail Individual Shareholders Shareholders of a listed Issuer who applies or bids for a value of not more than ` 200,000.
Retail Category The portion of the Issue being such number of Equity Shares available for allocation to RIIs
which shall not be less than the minimum bid lot, subject to availability in RII category and
the remaining shares to be allotted on proportionate basis.
Revision Form The form used by the Bidders in an issue through Book Building process to modify the
quantity of Equity Shares and/or bid price indicates therein in any of their Bid cum
Application Forms or any previous Revision Form(s)
RoC The Registrar of Companies
SEBI The Securities and Exchange Board of India constituted under the Securities and Exchange
Board of India Act, 1992
SEBI ICDR Regulations, 2009 The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009
Self Certified Syndicate Bank(s) A bank registered with SEBI, which offers the facility of ASBA and a list of which is
or SCSB(s) available on http://www.sebi.gov.in/cms/sebi_data/attachdocs/1316087201341.html
Specified Locations Refer to definition of Broker Centres
Stock Exchanges/ SE The stock exchanges as disclosed in the RHP/Prospectus of the Issuer where the Equity
Shares Allotted pursuant to the Issue are proposed to be listed
Syndicate The Book Running Lead Managers and the Syndicate Member(s)
Syndicate Agreement The agreement to be entered into among the Issuer, and the Syndicate in relation to collection
of the Bids in this Issue (excluding Bids from ASBA Bidders/Applicants)
Syndicate Member(s)/SM The Syndicate Member(s) as disclosed in the RHP/Prospectus
Underwriters The Book Running Lead Managers and the Syndicate Member(s)
Underwriting Agreement The agreement amongst the Issuer, and the Underwriters to be entered into on or after the
Pricing Date
Working Day All days other than a Sunday or a public holiday on which commercial banks are open for
business, except with reference to announcement of Price Band and Bid/Issue Period, where
working day shall mean all days, excluding Saturdays, Sundays and public holidays, which
are working days for commercial banks in India

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 SECTION VIII - MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION

Pursuant to the Companies Act and the SEBI Regulations the main provisions of our Articles relating to, inter alia,
voting rights, dividend, lien, forfeiture, restrictions on transfer and transmission of Equity Shares or debentures
and/or on their consolidation/splitting are detailed below. Please note that each provision herein below is numbered
as per the corresponding article number in our Articles and capitalized/defined terms herein have the same meaning
given to them in our Articles.

Capital
Authorized Capital
5 (a) The Authorized Capital of the Company shall be as stated in clause 5 of the
Memorandum of Association.
Issue of preference shares
(b) Subject to the provisions of Section 47 and 55 of the Act, and the provisions of the
Banking Regulation Act, any shares in the Company may be issued with such preferred
or other special rights, or such restrictions, whether in regard to dividend or repayment
of Capital or both, as the Company may from time to time by ordinary resolution
determine, and any preference shares may be issued on the terms that they are, or at the
option of the Company are liable, to be redeemed or converted into equity shares on
such terms and conditions and in such manner as may be determined by the Company in
General Meeting.
Redemption of preference shares
Provided that :

(i) no such shares shall be redeemed except out of the profits of the company which
would otherwise be available for dividend or out of the proceeds of a fresh issue
of shares made for the purposes of such redemption;
(ii) no such shares shall be redeemed unless they are fully paid;
(iii) where such shares are proposed to be redeemed out of the profits of the company,
there shall, out of such profits, be transferred, a sum equal to the nominal amount
of the shares to be redeemed, to a reserve, to be called the Capital Redemption
Reserve Account, and the provisions of this Act relating to reduction of share
capital of a company shall, except as provided in this section, apply as if the
Capital Redemption Reserve Account were paid-up share capital of the company.
Demat/remat of shares
(c) Shares and other securities issued by the Bank from time to time may be issued in
dematerialized form pursuant to the Depository Act, 1996. Besides, the Bank shall be
entitled to dematerialize its existing shares, rematerialize its shares held in the
Depositories.
Right to hold shares in dematerialized form
(d) The Company or an investor may exercise an option to issue, deal in, hold the securities
(including shares) with a Depository in electronic form and the certificates in respect
thereof shall be dematerialised, in which event the rights and obligations of the parties
concerned and matters connected therewith or incidental thereof, shall be governed by
the provisions of the Depositories Act, 1996 as amended from time to time or any
statuotry modification thereto or re-enactment thereof.
Reclassification of shares
(e) The Company may from time to time with the approval of shareholders in General
Meeting classify and reclassify such shares from the shares of one class into shares of
other class or classes and to attach thereto respectively such preferential, deferred,
qualified or other special rights, privileges, conditions or restrictions as may be
determined in accordance with the Articles of Association of the Company and to vary,
modify or abrogate any such rights, privileges, conditions or restrictions in such manner
and by such person as may for the time being be permitted under the provisions of the
Articles of Association of the Company or legislative provisions for the time being in
force in that behalf.
Registers etc.
6 The Company shall cause to be kept a register and index of members or other security
holders in accordance with all applicable provisions of the Companies Act, 2013 and
the Depositories Act, 1996 with details of shares held in physical and dematerialised

422
 forms in any medium as may be permitted by law including in any form or electronic
medium. The Company shall be entitled to keep in any State or Country outside India a
branch Register of Members Resident in that State or Country.
Closure of Registers
7 Subject to the provisions of Section 91 of the Act, the Directors shall have power to
close the Register of Members or Debenture-holders of the Company.
Inspection of Registers
8 (a) The registers and indices maintained pursuant to Section 88 and copies
of returns prepared pursuant to Section 92, shall be open for inspection during business
hours, of two hours (11.00 am to 01.00 p.m.) on every working day as the board may
decide, by any member, debenture holder, other security holder or beneficial owner
without payment of fee and by any other person on payment of a fee of ` 50 for each
inspection.
Taking extracts, copy of Registers
(b) Any such member, debenture holder, security holder or beneficial owner or any other
person may require a copy of any such register or entries therein or return on payment
of ` 10 for each page. Such copy or entries or return shall be supplied within seven days
of deposit of such fee.
Company to furnish copy of Registers
(c) The Company shall send to any Member, Debenture-holder or other persons, on
request, a copy of the Register of Members, the Index of Members, the Register and
Index of Debenture-holders or any part thereof required under the Act, on payment of
such sum as may be prescribed by the Act. The copy shall be sent within the period
prescribed by the Act.
Shares , debentures etc are transferable movable property
9 In accordance with the provisions of the Act, the shares, debentures or other interest of
any Member in the Company shall be movable property, transferable in the manner
provided in these presents.
Shares to be under control of the Board
10 Subject to the provisions of the Act and these presents, the shares in the capital of the
Company for the time being (including any shares forming part of any increased capital
of the Company) shall be under the control of the Board who may issue, allot or
otherwise dispose of the same or any of them to such persons in such proportion and on
such terms and conditions and either at a premium or at par and at such times or in such
other manner as they may from time to time think fit and proper. The Board may also
issue depository receipts whether domestic or foreign, with shares as underlying
security.
Issue of shares for consideration other than cash
11 Subject to the provisions of the Act and these presents, the Board may allot and issue
shares in the capital of the Company as payment or part payment for any property sold
or goods transferred or machinery supplied or for services rendered to the Company in
the conduct of its business and any shares which may be so allotted may be issued as
fully paid-up or partly paid-up shares and if so issued shall be deemed to be fully paid-
up shares or partly paid-up shares.
Unclassified shares
12 Subject to the provisions of the Act and these presents, any unclassified shares (whether
forming part of the original capital or of any increased capital of the Company) may be
issued and in particular such shares may be issued with a preferential or qualified right
as to dividends and distribution of the assets of the Company in the event of winding
up.
Further issue of shares
13 In addition to and without derogating from the powers for this purpose conferred on the
Board under other Articles, the Company may issue securities in accordance with the
provisions of Section 42, 55, 71 and 62 and all other applicable provisions of the Act
and Rules made thereunder.
Acceptance of shares
14 Any application signed by or on behalf of an applicant for shares in the Company,
followed by an allotment of any share therein, shall be an acceptance of shares within
the meaning of these presents and every person who thus or otherwise accepts any
share(s) and whose name is entered in the Register of Members shall, for the purpose
these presents, be a Member.

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Share call money as debt due to company
15 The money (if any) which the Directors shall, on the allotment of any share(s) being
made by them, require or direct to be paid by way of deposit, call or otherwise, in
respect of any share(s) allotted by them, shall immediately on the insertion of the name
of the allottee in the Register of Members as the name of the holder of such shares,
become a debt due to and recoverable by the Company from the allottee thereof and
shall be paid by him accordingly.
Installments on shares to be paid by Registered holder
16 If, by the conditions of allotment of any shares, the whole or part of the amount or issue
price thereof shall be payable by installments, every such installment shall, when due,
be paid up to the Company by the person who for the time being and from time to time
shall be the registered holder of the share or his legal representative.
Calls on shares of the same class , to be made on uniform basis
17 Where any calls for further share capital are made on shares, such calls shall be made
on a uniform basis on all shares falling under the same class. For the purposes of this
Article, shares of the same nominal value on which different amounts have been paid up
shall not be deemed to fall under the same class
Company to recognize registered holder as absolute owner of shares
18 Save as herein otherwise provided, the Company shall be entitled to treat the person
whose name appears on the Register of Members as the holder of any share as the
absolute owner thereof and, accordingly, shall not (except as ordered by a court of
competent jurisdiction or as by law required) be bound to recognize any benami, trust or
equity or equitable, contingent or other claim to or interest in such share on the part of
any other person whether or not it shall have express or implied notice thereof.
Restrictions on lending company’s funds for acquiring its own shares
19 Except to the extent allowed by Sections 67 and 68 of the Act, no part of the funds of
the company shall be employed/ lent for acquiring the shares of the Company.
TRUST NOT TO BE ENTERED ON THE REGISTER
Trust not to be recognized as member
20 Except as required by law, no person shall be recognized by the Company as holding
any share upon any trust and the Company shall not be bound by or compelled in any
way to recognize (even when having notice thereof) any equitable, contingent, future or
partial interest in any share or any interest in any fractional part of a share or (except
only as by these regulations or by law otherwise provided) any other rights in respect of
any share except an absolute right to the entirety thereof in the registered holder.
COMMISSION AND BROKERAGE
Payment of commission and brokerage
21 (a) The company may exercise the powers of paying commissions conferred by sub-
Section (6) of Section 40, provided that the rate per cent or the amount of the
commission paid or agreed to be paid shall be disclosed in the manner required by
that Section and rules made thereunder
(b) The rate or amount of the commission shall not exceed the rate or amount
prescribed in rules made under sub-Section (6) of Section 40 of the Act and the
Banking Act.
(c) The commission may be satisfied by the payment of cash or the allotment of fully
or partly paid shares or partly in the one way and partly in the other.
Payment of brokerage
22 The Company may also, on any issue of shares, debentures or other securities
pay such brokerage as may be lawful and the same shall within the limit prescribed
under the Act and the Banking Act.
SHARE CERTIFICATES
Issue of Share Certificates
23 (a) The company shall, unless prohibited by any provision of law or any order of Court,
Tribunal or other authority, deliver the certificates of all securities allotted, transferred
or transmitted—

(i) within a period of two months from the date of allotment, in the case of any
allotment of any of its shares;
(ii) within a period of one month from the date of receipt by the company of the
instrument of transfer or, as the case may be, of the intimation of transmission , in
the case of a transfer or transmission of securities;

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 (iii) within a period of six months from the date of allotment in the case of any
allotment of debenture:

Provided that every person subscribing to securities offered by the Bank shall have the
option either to receive the share/ security certificates or to hold shares/ securities in a
dematerialised form.

Provided that where the securities are dealt with in a depository, the company shall
intimate the details of allotment of securities to depository immediately on allotment of
such securities.

Notwithstanding anything contained above, the certificates in respect of all securities

allotted, transferred or transmitted will be delivered within such other shorter period as
may be required by stock exchanges where the securities of the company are listed
Denomination and delivery of Certificates
(b) In respect of any share or shares held jointly by several persons, the company shall not
be bound to issue more than one certificate, and delivery of a certificate for a share to
one of several joint holders shall be sufficient delivery to all such holders;
Certficate to be under seal
(c) Each certificate shall be under the seal and shall specify the shares to which it relates
and the amount paid up thereon

Replacement certificates
24 (a) The company will not charge any fees for the issue of new certificates
in replacement of those which are old, decrepit or worn out or where the cages on the
reverse for recording transfers have been fully utilized.
Duplicate certificates
(b) If a certificate is torn or defaced, lost or destroyed, it may be replaced by the issue of a
new certificate on payment of a fee not exceeding that which may be agreed upon with
the appropriate Stock Exchange and on such terms, if any, as to evidence and indemnity
and payment of out of pocket expenses incurred by the company in investigating
evidence as the Board thinks fit.
Certificates on sub-division/ consolidation
(c) The company may charge such fees not exceeding that which may be agreed upon with
the appropriate Stock Exchange for sub-division and consolidation of certificates and
letters of allotment into denominations other than the market lot.
Board’s power to refuse sub-division of share certificates
(d) The Directors may, at their absolute discretion, refuse applications for the subdivision
of share certificates, debenture or bond certificates into denominations of less than the
marketable lot except when such subdivision is required to be made to comply with a
statutory provision or an order of a competent court of law.
Fractional certificates
25 (a) If and whenever, as a result of issue of new shares, the consolidation or subdivision
of shares, any Member becomes entitled to any fractional part of a share, the Board
may subject to the provisions of the Act and these presents and to the directions, if
any, of the Company in General Meeting:
Disposal of Fractional certificates
(i) issue to such Member fractional certificate or certificates representing such
fractional part. Such fractional certificate or certificates shall not be registered,
nor shall they bear any dividend until exchanged with other fractional certificates
for an entire share. The Directors may, however, fix the time within which such
fractional certificates are to be exchanged for an entire share and may extend such
time and if at the expiry of such time, any fractional certificates shall be deemed
to be cancelled and the Directors shall sell the shares represented by such
cancelled fractional certificates for the best price reasonably obtainable; or
(ii) sell the shares represented by all such fractional parts for the best price
reasonably obtainable.
Sales Proceeds of fractional certificates
(b) In the event of any shares being sold, in pursuance of sub-article (a) (ii) above, the
Board shall pay and distribute to and amongst the persons entitled, in due proportion the
net sale proceeds thereof.

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Transfer of fractional shares by sale
(c) For the purpose of giving effect to any such sale, the Board may authorize any person to
transfer the shares sold to the purchaser thereof, comprised in any such transfer and the
purchaser shall not be bound to see to the application of purchase money nor shall his
title to the shares be affected by any irregularity or invalidity in the proceedings in
reference to the same.
CALLS
Calls on shares
26 The Board may from time to time by a resolution passed at a meeting of the Board of
Directors, (and not by circular resolution) make such calls as they think fit upon the
Members in respect of all monies unpaid on the shares held by them, respectively, and
not by the conditions of allotment thereof made payable at fixed times and each
Member shall pay the amount of every call so made on him to the Bank or other person
and at the times and places appointed by the Board. A call may be made payable by
installments.

Subject to the provisions of the Companies Act, 2013, the option or right to call of
shares shall not to be given to any person or persons without the sanction of the
company in General Meeting.
Calls when made
27 A call shall be deemed to have been made at the time when the resolution of the Board
authorizing such call was passed and may be made payable by Members on such date or
at the discretion of the Board on such subsequent date as shall be fixed by the Board.

Notice of call
28 Not less than 14 days’ notice of every call shall be given, specifying the time and place
of payment, provided that before the time for payment of such call, the Board may by
notice in writing to the Members revoke or postpone the same.
Extension of time of call
29 The Board may from time to time, at their discretion, extend the time fixed for the
payment of any call by such Member(s) for such cause as the Board may deem fit, but
no Member(s) shall be entitled to such extension save as a matter of grace and favour. A
call may be revoked at the discretion of the Board.
Amounts payable at fixed times or by installments, as call
30 If by the terms of issue of any share or otherwise any amount is made payable at any
fixed time or by installments at fixed times, whether on account of the nominal amount
of the share or by way of premium, every such amount or instalment shall be payable as
if it were a call duly made by the Board and of which due notice has been given and all
the provisions herein contained in respect of calls shall relate to such amount or
installment accordingly.
Interest on call amount
31 If the sum payable in respect of any call or instalment be not paid on or before the day
appointed for payment thereof, the holder for the time being or the allottee of the share
in respect of which a call shall have been made or the instalment shall be due, shall pay
interest on the same at such rate as the Board shall fix from time to time from the day
appointed for the payment thereof to the date of actual payment, but the Board may, in
their absolute discretion, waive payment of such interest wholly or in part.
Adjustment of monies due to member, against calls or otherwise
32 Any money due from the company to a member may, without the consent of such
member , be applied by the company whether wholly or in part, towards payment of any
money due from him either singly or jointly with any other person / s to the company
for calls or otherwise
Decree or partial payment not to preclude forfeiture
33 Neither a judgment nor a decree in favour of the Company for calls or other monies due
in respect of any shares nor any part payment or satisfaction there under nor the receipt
by the Company of a portion of any money which shall from time to time be due from
any Member in respect of any shares either by way of principal or interest nor any
indulgence granted by the Company in respect of payment of any money shall preclude
the forfeiture of such shares as herein provided.
Interest on calls in advance
34 The Board may, if they think fit, solicit payment of and receive from any Member

426
 willing to advance the same, all or any part of the monies due upon the shares held by
him beyond the sums actually called up, and upon the monies so paid in advance or so
much thereof as from time to time exceeds the amount of the calls then made upon the
shares in respect of which such advance has been made, the Company may pay interest
at such rate as the Member paying such sum in advance and the Board agree upon and
the Board may at any time repay the amount so advanced upon giving to such Member
one month’s notice in writing. Members shall not be entitled to claim any interest on
voluntary and unsolicited advance payment of calls, if any, made by them.
Calls paid in advance not entitled for dividend
35 Any amount paid up in advance of calls on any share will not entitle the holder of the
share to participate in respect thereof, in a dividend subsequently declared or to
participate in profits.
No privilege of membership until calls are duly paid
36 No Member shall be entitled to receive any dividend or to exercise any privilege as a
Member until he shall have paid all calls for the time being due and payable on every
share held by him whether alone or jointly with any person, together with interest and
expenses, if any.
Evidence in legal action by company against shareholders for recovery of share monies
37 On the trial or hearing of any action or suit brought by the Company against any
Member or his legal representatives for the recovery of any monies claimed to be due to
the Company in respect of his shares, it shall be sufficient to prove that the name of the
Member, in respect of whose shares the monies are sought to be recovered, is entered in
the Register of Members as a Member/one of the Members at or any subsequent date on
which the monies sought to be recovered are claimed to have become due on the shares
and that the resolution making the call is duly recorded in the Minutes book and the
notice of such call was duly given to the Member, holder or joint-holder or his legal
representatives sued in pursuance of these presents. It shall not be necessary to prove
the appointment of Directors who made such call, nor that the quorum of Directors was
present at the Board at which any such call was made nor that the Meeting at which any
such call was made had been duly convened or constituted nor any other matter
whatsoever but the proof of the matters aforesaid shall be conclusive evidence of the
debt.
FORFEITURE, SURRENDER AND LIEN
Notice must be given if call or installment not paid
38 If any Member fails to pay the whole or any part of any call or installment or any
money due in respect of any share(s) either by way of principal or interest on or before
the day appointed for the payment of the same, the Board may at any time thereafter
during such time as the call or installment or any part thereof or other monies remaining
unpaid or a judgment or decree in respect thereof remains unsatisfied in whole or in
part, serve a notice on such Member or on the person (if any) entitled to the share(s) by
transmission requiring him to pay such call or installment or such part thereof or other
monies as remaining unpaid together with any interest that may have accrued and all
expenses (legal or otherwise) that may have been incurred by the Company by reason of
such non-payment.
Period of notice and contents
39 The notice shall name a day not being less than 14 days from the date of the notice and
the place or places on and at which such call or installment or such part or other monies
as aforesaid and such interest and expenses as aforesaid are to be paid. The notice shall
also state that in the event of non-payment at or before the time and at the place
appointed, the share(s) in respect of which the call was made or installments is payable
will be liable to be forfeited.
In default of payment, shares may be forfeited
40 If the requisition of any such notice as aforesaid is not complied with, any of the
share(s) in respect of which such notice has been given may, at any time thereafter
before payment of all calls or installments, interest and expenses or the money due in
respect thereof, be forfeited by a resolution of the Board to that effect. Such forfeiture
shall include all dividends declared in respect of the forfeited share(s) and not actually
paid before the forfeiture.
Entry of forfeiture in the Register of Members
41 When any share(s) shall have been so forfeited, an entry of the forfeiture with the date
thereof shall be made in the Register of Members.

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Disposal of forfeited shares
42 Any share(s) so forfeited shall be deemed to be the property of the Company and may
be sold, re-allotted or otherwise disposed of either to the original holder thereof or to
any other person upon such terms and in such manner as the Board shall think fit.
Power to annul forfeiture
43 The Board may at any time before any share(s) so forfeited shall have been sold, re-
allotted or otherwise disposed of, annul the forfeiture thereof upon such conditions as
they think fit.
Effect of forfeiture
44 The forfeiture of share(s) shall involve the extinction at the time of the forfeiture, of all
interest in and all claims and demand against the Company in respect of the share(s) and
all other rights incidental to the share(s), except only such of those rights as by these
presents are expressly saved.
Member liable to pay to Company all dues on the shares irrespective of forfeiture.
45 Any Member whose share(s) has/have been forfeited shall cease to be a member in
respect of the forfeited shares , but shall, notwithstanding the forfeiture, remain liable to
pay to the Company all calls, instalments, interest, expenses and other monies owing
upon or in respect of such shares at the time of the forfeiture together with further
interest thereon from the time of the forfeiture until payment at such rate as the Board
may determine and the Board may enforce the payment of the whole or a portion
thereof if they think fit but shall not be under any obligation to do so; but his liability
shall cease if and when the company shall have received payment in full of all such
monies in respect of the shares .
Evidence of forfeiture
46 A duly verified declaration in writing under the hand of any Director or the Secretary or
such other person as may be authorised from time to time that the call in respect of
share(s) was made and that the forfeiture of share(s) was made, by a resolution of the
Board to that effect, shall be conclusive evidence of the fact stated therein as against all
persons entitled to such share.
Title of purchaser / allottee of forfeited shares.
47 The Company may receive consideration, if any, given for the share(s) on any sale, re-
allotment or other disposition thereof and the person to whom such share(s) is sold, re-
allotted or disposed of may be registered as the holder of the share(s) and shall not be
bound to see to the application of the consideration, if any, nor shall his title to the
share(s) be affected by any irregularity or invalidity in the proceedings in reference to
the forfeiture, sale, re-allotment or other disposal of the share(s).
Cancellation of share certificates of forfeited shares
48 Upon sale, re-allotment or other disposal under the provisions of these presents, the
certificate or certificates originally issued in respect of the relative share(s) shall (unless
the same shall on demand by the Company have been previously surrendered to it by
the defaulting Member) stand cancelled automatically and become null and void and of
no effect and the Board shall be entitled to issue a new certificate or certificates in
respect of such share(s) to the person(s) entitled thereto.
Forfeiture of shares for nonpayment of calls at fixed times
49 The provisions of these Articles as to the forfeiture shall apply in the case of non-
payment of any sum which by terms of issue of share(s) become payable at a fixed time,
as if the same had been payable by virtue of a call duly made or notified.
Company’ lien on shares
50 The Company shall have no lien on its fully-paid shares. In the case of partly paid-up
shares, the Company shall have a first and paramount lien on every share for all monies
that are called or remain payable together with any interest that may have accrued and
all expenses (legal or otherwise) that may have been incurred by the Company by
reason of non-payment of calls. Any such lien shall extend to all dividends from time to
time declared in respect of such shares. Unless otherwise agreed, the registration of a
transfer of shares shall operate as a waiver of the Company’s lien, if any, on such
shares.
Enforcing of lien by sale
51 For the purpose of enforcing such lien, the Board may sell the shares subject thereto in
such manner as they think fit, but no sale shall be made unless the sum in respect of
which the lien exists is presently payable nor until notice in writing of the intention to
sell shall have been served on such Member or the person (if any) entitled by

428
 transmission to the shares and default shall have been made by him in payment of the
sum presently payable for 14 days after such notice.
Application of sales proceeds of share
52 The net proceeds of any such sale after payment of the costs of such sale shall be
applied in or towards the satisfaction of the debt or liability in respect whereof the lien
exists so far as the same is presently payable and the residue (if any) paid to the
Member or the person (if any) entitled by transmission to the shares so sold; Provided
that the amount so paid to such Member or person shall not exceed the amount received
by the Company from such Member or person towards such shares.
Surrender of shares by members
53 Subject to the provisions of the Act, the Board may accept surrender of any share(s)
from or any Member desirous of surrendering, on such terms as they think fit.
TRANSFER AND TRANSMISSION OF SHARES
Transfer not to be registered except on production of instrument of transfer/common form of transfer
54 A common form of transfer shall be used. A company shall not register a transfer of
securities of the company, other than the transfer between persons both of whose names
are entered as holders of beneficial interest in the records of a depository, unless a
proper instrument of transfer/common form of transfer as prescribed in the Rules made
under sub-Section (1) of Section 56 of the Act, duly stamped, dated and executed by or
on behalf of the transferor and the transferee and specifying the name, address and
occupation, if any, of the transferee has been delivered to the company by the transferor
or the transferee within a period of sixty days from the date of execution, along with the
certificate relating to the securities, or if no such certificate is in existence, along with
the letter of allotment of securities:

Provided that where the instrument of transfer/ common form of transfer has been lost
or the instrument of transfer/ common form of transfer has not been delivered within the
prescribed period, the company may register the transfer on such terms as to indemnity
as the Board may think fit.

No instrument of transfer/ common form of transfer shall be necessary as regards

transfer of shares or other securities held in dematerialized form and such transfers shall
be registered in accordance with the applicable regulations of the Depositories Act,
1996;
Waiving of instrument of transfer
Provided that where on an application in writing made to the Company by the transferee
and bearing the stamp required for an instrument of transfer, it is proved to the
satisfaction of the Board that the instrument of transfer signed by or on behalf of the
transferor and by or on behalf of the transferee has been lost, the Company may register
the transfer on such terms as to indemnity as the Board may think fit.
This article does not apply to transmission cases
Nothing in this Article shall prejudice the power of the company to register, on receipt
of an intimation of transmission of any right to securities by operation of law from any
person to whom such right has been transmitted.
Transfer by legal representative
55 A transfer any security or other interest in the Company of a deceased Member thereof
made by his legal representative shall, although the legal representative is not himself a
Member, be as valid as if he had been a Member at the time of the execution of the
instrument of transfer.
Application for registration of transfer
56 (a) An application for the registration of a transfer of any share(s), debenture(s) or any
other securities or other interest of a Member in the Company may be made either by
the transferor or by the transferee.
Transfer of partly paid shares
(b) Where the application is made by the transferor and relates to partly paid shares, the
transfer shall not be registered, unless the Company gives notice as per Rules to the Act,
of the application to the transferee and the transferee makes no objection to the transfer
within two weeks from the receipt of the notice.
Service of notice to the transferee in the case of partly paid shares
(c) For the purpose of sub-article (b) above, notice to the transferee shall be deemed to have
been duly given if it is dispatched by prepaid registered post to the transferee at the

429
 address given in the instrument of transfer and shall be deemed to have been duly
delivered at the time at which it would have been delivered in the ordinary course of
post.
Prior RBI approval necessary for acquisition of shares in certain cases
(d) Acquisition of shares by a person/group which could take in the aggregate his/ her/ its
holding to a level of 5 per cent or more of the total paid-up capital of the Bank (or such
other percentage as may be prescribed by Reserve Bank of India from time to time)
should be effected by such buyer(s) after obtaining prior approval of Reserve Bank of
India.
Board’s power to refuse registration of transfer
57 The Board of Directors may refuse to register the transfer of any shares to the name of
the transferee on any one or more of the following grounds :

(a) That the instrument of transfer/common form transfer is not proper or has not
been duly stamped and executed or comprises more than one class of shares or
that the certificate relating to the shares has not been delivered to the Company or
that any other requirement under the Law relating to the registration of such
transfer has not been complied with.
(b) That the transfer is in contravention of any law.
(c) That the transfer is likely to result in such change in the composition of the Board
of Directors as would be prejudicial to the interest of the Company or to the
public interest and / or is in contravention of any statutory / regulatory guidelines,
instructions or advices, as may be considered by the Board as ‘sufficient cause’
for refusal to be recorded in writing, in which event the concerned stock exchange
shall be taken into confidence, when so required, as to the reasons for such
rejection.
(d) That the transfer is prohibited by any Order of the Court , Tribunal or other
authority under any law for the time being in force.
Company’s power to refuse transfer
58 Nothing in these presents shall prejudice the powers of the Company to refuse to
register the transfer of any shares.
Company to recognize transferee as member only upon registration of transfer
59 The transferor shall be deemed to remain the holder of such shares until the name of the
transferee is entered in the Register of Members in respect thereof.
Board may refuse to register transfer
60 (a) Notwithstanding anything contained in Articles 54, 55 and 56 but subject to the
provisions of Section 58 of the Act and the Rules and Regulations made there
under and other applicable laws and the Banking Regulation Act, the Board may,
at their absolute and uncontrolled discretion, decline to register or acknowledge
any transfer of shares and by giving reasons for such refusal and in particular may
so decline in respect of the shares upon which the Company has a lien or whilst
any monies in respect of the shares desired to be transferred or any of them
remain unpaid and such refusal shall not be affected by the fact that the proposed
transferee is already a Member;

Provided that registration of any transfer shall not be refused on the ground of the
transferor being either alone or jointly with any other person or persons indebted to the
Company on any account whatsoever.

(b) Without prejudice to the foregoing provisions and without limiting in any manner
the generality of the above provisions, the Board may, at their absolute and
uncontrolled discretion, refuse to register the transfer of any shares or other
securities of the Company being shares or securities issued by the Company, in
favour of any transferee whether individual, firm, group, constituent of a group,
Body Corporate or Bodies Corporate under the same management or otherwise
and whether in his or its own name or in the name of any other person if the total
nominal value of the shares or other securities intended to be so transferred is not
less than, or together with the total nominal value of any shares or other securities
already held in the Company by such individual, firm, group, constituent of a
group, Body Corporate or Bodies Corporate under the same management or
otherwise will not be less than five per cent of the paid-up equity share capital of
the Company ( or such other limit as may be prescribed by the Reserve Bank of

430
 India from time to time) or, if the Board is satisfied that as a result of the
proposed transfer of any shares or securities or block of shares or securities of the
Company, a change in the composition of the Board of Directors or change in the
controlling interest of the Company is likely to take place and that such change
would be prejudicial to the interest of the Company or to the public interest. For
the purpose of this Article, the Board shall be entitled, inter alia, to rely upon this
Article to form its own opinion as to whether such registration of transfer of any
of its shares or other securities being not less than five per cent of the paid-up
equity share capital of the Company, should be refused or not.
(c) Notwithstanding anything to the contrary, the restrictive provisions contained in
the preceding sub-article (b) may not apply to the transfer of any shares or other
securities made to and representing the own investment of any of the following :

(i) public financial institutions within the meaning of Section 2 (72) of the Act;
(ii) public sector banks;
(iii) multilateral agencies, foreign banks and institutions; and
(iv) public sector mutual funds being mutual funds sponsored, promoted or
managed by a public financial institution or a public sector bank.
Notice of refusal of transfer
61 If the Company refuses to register the transfer of any shares, it shall, within two months
from the date on which the instrument of transfer is delivered to the Company, send to
the transferee and the transferor notice of the refusal.
Transfer to minor etc
62 Subject to the provisions of the Act, no transfer shall be made to a person who is of
unsound mind. The Board may at their absolute discretion approve a minor, becoming a
Member of the Company on such terms as the Board may stipulate.
Custody of transfer deeds
63 The instrument of transfer shall, after registration, be retained by the Company and shall
remain in its custody. All the instruments of transfer which the Board may decline to
register shall on demand be returned to the persons depositing the same. The Board may
cause to be destroyed all transfer deeds lying with the Company after such period as
may be prescribed.
Title to shares of deceased member
64 The executors or administrators of a deceased Member or a holder of a Succession
Certificate or other legal representative in respect of shares of a deceased Member
where he was a sole or only surviving holder shall be the only person whom the
Company will be bound to recognize as having any title to the shares registered in the
name of such Member and the Company shall not be bound to recognize such
executors, administrators or holder unless such executors or administrators shall have
first obtained probate or Letters of Administration or such holder is the holder of a
Succession Certificate or other legal representation as the case may be, from a court of
competent jurisdiction;

Provided that in any case where the Board, at their absolute discretion, thinks fit, may
dispense with production of probate or Letters of Administration or Succession
Certificate or other legal representation and under Article 65 register the name of any
person who claims to be absolutely entitled to the share standing in the name of a
deceased Member as a Member.
“Transmission Clause”.
65 Any person becoming entitled to any share in consequence of the death, lunacy,
bankruptcy or insolvency of any Member or by any lawful means other than by a
transfer in accordance with these presents, may, with the consent of the Board (which
they shall not be under any obligation to give) upon producing such evidence that he
sustains the character in respect of which he proposes to act under this Article or of his
title as the Board shall require, either be registered as a Member in respect of such
shares or may subject to the regulations as to transfer contained in these presents
transfer such shares to some other person. This Article is in these presents referred to as
the “Transmission Clause”.
Refusal of transmission
66 The Board shall have the same right to refuse to register a person entitled by
transmission to any shares or his nominee as if he were the transferee named in an

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 ordinary transfer presented for registration.
Evidence of transmission to be verified
67 Every transmission of a share shall be verified in such manner as the Board may require
and the Company may refuse to register any transmission until the same be so verified
or until or unless an indemnity be given to the Company with regard to such registration
which the Board, at their discretion, shall consider sufficient, provided nevertheless that
there shall not be any obligation on the Company or the Board to accept any indemnity.
Fee on transfer/transmission
68 (a) No fee shall be charged for transfer , transmission of shares/other securities.No fee shall
be charged for registering probate , succession certificate, letter of administration,
certificate of death or marriage , power of attorney or similar other documents.
Board’s power to suspend registration of transfer/ transmission
(b) Subject to the provision of Section 91 of the Act, the registration of transfer /
transmission may be suspended at such times and for such periods as the Board may
from time to time determine.
Company not liable for disregard of a Notice against registration of transfer
69 The Company shall incur no liability or responsibility whatever in consequence of their
registering or giving effect to any transfer of shares made or purporting to be made by
the apparent legal owner thereof (as shown or appearing in the Register of Members) to
the prejudice of persons having or claiming any equitable right, title or interest to or in
the same shares notwithstanding that the Company may have had notice of such
equitable right, title or interest or notice prohibiting registration of such transfer, and
may have entered such notice or referred thereto in any book of the Company and the
Company shall not be bound or required to regard or attend or give effect to any notice
which may be given to them of any equitable right, title or interest or be under any
liability whatsoever for refusing or neglecting to do so though it may have been entered
or referred to in some book of the Company but the Company shall nevertheless be at
liberty to regard and attend to any such notice and give effect thereto, if the Board shall
so think fit.
INCREASE, REDUCTION AND ALTERATION OF CAPITAL
Power to increase capital
70 Subject to the provisions of said Acts, the Company may from time to time increase its
share capital by such sums to be divided into shares of such amount, as may be
specified in the resolution issuing new shares.
Conditions as to issue of new shares
71 Subject to the provisions of the Act and these presents, the new shares (except such of
them as shall be unclassified shares subject to the provisions of Article 12) shall be
issued upon such terms and conditions and with such rights and privileges annexed and
in particular such shares may be issued with a preferential or qualified right to dividends
and in distribution of the assets of the Company.
Further issue of capital, offer and disposal
72 Subject to the provisions of the Act and these presents, the new shares (resulting from
an increase of capital as aforesaid) may be issued or disposed of by the Company in
General Meeting or by the Board under their powers in accordance with the provisions
of Articles 10, 11, 12, 13 and the following provisions:-

(a) (i) Such new shares may be offered to persons who, at the date of the offer, are
holders of equity shares of the company in proportion, as nearly as
circumstances admit, to the paid-up share capital on those shares by sending
a letter of offer.
(ii) The offer shall be made by notice specifying the number of shares offered
and limiting a time not being less than fifteen days and not exceeding thirty
days from the date of the offer within which the offer, if not accepted, shall
be deemed to have been declined;
(iii) The offer aforesaid shall be deemed to include a right exercisable by the
person concerned to renounce the shares offered to him or any of them in
favour of any other person; and the notice referred to in aforesaid clause
shall contain a statement of this right;
(iv) After the expiry of the time specified in the notice aforesaid, or on receipt of
earlier intimation from the person to whom such notice is given that he
declines to accept the shares offered, the Board of Directors may dispose of

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 them in such manner which is not dis¬advantageous to the shareholders and
the company;

Provided that the right of the renouncees for the share allotment shall be subject to the
right of refusal by the Board under Article 57 (b), (c) and (d) of these Regulations in the
same manner as applicable to transfer of shares, and further subject to other terms and
conditions, if any, whatsoever as may be decided by the Company in General Meeting
or by the Board of Directors and stipulated in the terms of issue.

(b) Nothing in clause (ii) of article (a) above shall be deemed;

(i) to extend the time within which the offer should be accepted; or
(ii) to authorize any person to exercise the right of renunciation for a second
time on the ground that the person in whose favour the renunciation was first
made has declined to take the shares comprised in the renunciation.
Issue of shares under the employees’ stock option scheme
(c) The new shares may be offered to employees under a scheme of employees’ stock
option, subject to special resolution passed by the Company and on satisfying other
conditions as prescribed by the Act and the Rules, Guidelines and other regulations
made in this regard under any of the laws.

Further issue of shares

(d) The new shares may also be offered to any persons, whether such persons include
persons mentioned in clause (a) and (c) of this Article, if it is authorised by a
special resolution, either for cash or for consideration other than cash, if the price
of such share is determined by the Valuation Report of a Registered Valuer, and
such other conditions as prescribed by the Act and the Rules, Guidelines and
other regulations made in this regard under any of the laws are satisfied.
(e) Nothing in this article shall apply to the increase of the subscribed capital of the
Company caused by the exercise of an option attached to the debentures issued or
loans raised by the Company to convert such debentures or loans into shares in
the Company
Status of new shares vis-à-vis original shares
73 Except so far as otherwise provided by the conditions of issue or by these presents, any
capital raised by the creation of new shares shall be considered part of the original
capital and shall be subject to the provisions herein contained with reference to the
payment of calls and instalments, transfer and transmission, forfeiture, lien, surrender,
voting and otherwise.
Power to sub- divide, consolidate, cancel shares
74 Subject to the provisions of Section 61 of the Act and Rules thereto, the company may
alter the condition of shares as contained in its Memorandum and Articles of
Association as follows :

(a) increase its authorised share capital by such amount as it thinks expedient
(b) consolidate and divide all or any of its share capital into shares of larger amount
than its existing shares.
(c) convert all or any of its fully paid-up shares into stock, and reconvert that stock
into fully paid-up shares of any denomination
(d) sub-divide its existing shares or any of them into shares of smaller amount than is
fixed by the memorandum
(e) cancel any shares which, at the date of the passing of the resolution, have not
been taken or agreed to be taken by any person.
Buy back of shares
75 Subject to the provisions of the Act and the Rules and regulations as may be
issued/notified by competent authority, the Company may buy back its own shares or
other securities.
Reduction of share capital
76 The Company may, reduce its share capital in accordance with relevant statutory
provisions that may be in force at the time of reduction.
MODIFICATION OF CLASS RIGHTS

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Variation of rights of any class of share holders
77 Where at any time the Share Capital is divided into different classes of shares, the rights
attached to the shares of any class, unless otherwise provided by the terms of issue of
the shares of that class, may be varied in accordance with relevant provisions of the Act
and Rules made there under:

Provided that the rights attached to the shares of any class issued with preferred or other
rights shall not, unless otherwise expressly provided by the terms of issue of the shares
of that class, be deemed to be varied by the creation or issue of further shares ranking
pari passu therewith.
JOINT-HOLDERS
Joint holders
78 Where two or more persons are registered as the holders of any share, they shall be
deemed to hold the same as joint tenants with benefits of survivorship, subject to the
following and other provisions contained in these presents:
Maximum three persons as joint holders
(a) The Company shall be entitled to decline to register more than three persons as the
joint-holders of any share.
Jointly and severally liable on the shares
(b) The joint-holders of any share shall be liable severally as well as jointly for and in
respect of all calls and other payments which ought to be made in respect of such share.
Title of survivors. Estate of the deceased share holder remains liable on the shares
(c) On the death of any such joint-holder, the survivor or survivors shall be the only person
or persons recognized by the Company as having any title to the share but the Board
may require such evidence of death as they may deem fit and nothing herein contained
shall be taken to release the estate of a deceased joint-holder from any liability on
shares held by him jointly with any other person.
Receipt of one joint holder is effectual discharge
(d) Any one of such joint-holders may give effectual receipts for any dividends or other
monies payable in respect of such share.
Delivery of certificates / documents on the first named holder
(e) Only the person whose name stands first in the Register of Members as one of the joint-
holders of any share shall be entitled to delivery of the certificate relating to such share
or to receive notice from the Company and any notice given to such person shall be
deemed notice to all the joint holders.
Votes of joint holders
(f) Any one of two or more joint-holders may vote at any meeting, either personally or by
attorney or by proxy, in respect of such share as if he were solely entitled thereto and if
more than one of such joint holders be present at any meeting personally or by proxy or
by attorney then, that one of such persons so present whose name stands first or higher
(as the case may be) in the Register in respect of such share shall alone be entitled to
vote in respect thereof but the other or others of the joint-holders shall be entitled to be
present at the meeting, provided always that a joint-holder present at any meeting
personally shall be entitled to vote in preference to a joint-holder present by attorney or
by proxy although the name of such joint-holder present by attorney or proxy stands
first or higher (as the case may be) in the Register in respect of such shares. Several
executors or administrators of a deceased Member in whose (deceased Member’s) sole
name any share stands shall, for the purpose of this clause, be deemed joint-holders.
BORROWING POWERS
Board’s power to borrow
79 Subject to the relevant provisions of the said Acts, the Board of Directors may from
time to time, by a resolution passed at a meeting of the Board, borrow monies and may
generally raise and secure the payment of such sum or sums in such manner and upon
such terms and conditions in all respects as they think fit and in particular by the issue
of bonds, perpetual or redeemable debentures or debenture stock or promissory notes or
any other instruments by creating any mortgage or charge or other security on the
undertaking or the whole or any part of the property or undertaking of the Company,
both present and future :
Restrictions on Board’s power to borrow
Provided that the Board shall not borrow monies, where monies to be borrowed together
with the monies borrowed by the Company, apart from temporary loans obtained in its

434
 ordinary course of business and except as otherwise provided hereafter, shall exceed the
aggregate of the paid-up capital of the Company and its free reserves, that is to say,
reserves not set apart for any specific purpose, except with the sanction of the company
in General Meeting:

Provided, further, that :

(a) nothing contained hereinabove shall apply to any sums of monies borrowed by
the Company from any other banking companies or from the Reserve Bank of
India, State Bank of India or any other bank established by or under any law for
the time being in force;
(b) acceptance by the Company in the ordinary course of business of deposits of
monies shall not be deemed to be borrowing of monies by the Company for the
purpose aforesaid.

Provided, further, that the Company shall not create:

(a) charge upon any unpaid capital of the Company; and

(b) a floating charge on the undertaking or any property of the Company or any part
thereof unless the creation of such floating charge is certified in writing by the
Reserve Bank of India as provided in the Banking Act.
Bonds, debentures etc are under control of the Board
80 (a) Any bonds, debentures, debenture stock or other debt securities issued or to be
issued by the Company shall be under the control of the Board who may issue
them upon such terms and conditions and in such manner and for such
consideration as they shall consider to be for the benefit of the Company.
Debt securities may be made assignable free from any equities
81 Debentures, debenture stock, bonds or other debt securities may be made assignable
free from any equities between the Company and the person to whom the same may be
issued.
Mode of issuance of debt securities
82 Subject to the provision of the said Acts, any bonds, debentures, debenture stock or
other debt securities may be issued at such price and with any special privileges as to
redemption, surrender, drawing, allotment of shares, appointment of Directors or
otherwise.
Register of Charges
83 The Board shall cause a proper register to be kept in accordance with the provisions of
Section 85 of the Act of all mortgages and charges specifically affecting the property of
the Company and shall duly comply with the requirements of the Act in regard to
registration of mortgages and charges and in regard to inspection to be given to
creditors or Members of the Register of Charges and of copies of instruments creating
charges. Such sum as may be prescribed by the Act shall be payable by any person
other than a creditor or Member of the Company for each inspection of the Register of
Charges.
MEETINGS
Annual General Meeting
84 The Company shall, in each year, hold, in addition to any other meetings, a general
meeting which shall be styled as its “Annual General Meeting” in accordance with the
provisions of Section 96 of the Act.
Extraordinary General Meetings
85 All General Meetings other than Annual General Meetings shall be called Extraordinary
General Meetings
Calling of Extraordinary General Meetings and requirements
86 The Board of Directors may, whenever they think fit, and shall, on the requisition of
such number of Members of the Company as is specified in sub-article (c) of this
Article forthwith proceed and call an Extraordinary General Meeting of the Company
and in case of such requisition the following provisions shall apply:

(a) The requisition shall set out the matters for the consideration of which the meeting
is to be called, shall be signed by the requisitionists and shall be deposited at the
Registered Office of the Company or by electronic means.

435
 (b) The requisition may consist of several documents in like form, each signed by one
or more requisitionists.
c) The number of Members entitled to requisition a meeting with regard to any matter
shall be such number of them as hold at the date of the deposit of the requisition,
not less than one-tenth of such of the paid-up capital of the Company as at that date
carries the right of voting in regard to that matter.
(d) Where two or more distinct matters are specified in the requisition, the provisions of
sub-article (c) above shall apply separately in regard to each such matter and the
requisition shall accordingly be valid only in respect of those matters in regard to
which the condition specified in that sub-article is fulfilled.
(e) If the Board does not, within 21 days from the date of the receipt of a valid
requisition in regard to any matters, proceed duly to call a meeting for the
consideration of those matters on a day not later than 45 days from the date of the
receipt of the requisition, the meeting may be called and held by the requisitionists
themselves or by such of the requisitionists as represent either a majority in value
of the paid-up share capital held by all of them or not less than one-tenth of such of
the paid-up share capital of the Company as is referred to in sub-article (c) above,
whichever is less. However, for the purpose of this sub-article, the Board shall, in
the case of a meeting at which a resolution is to be proposed as a Special
Resolution, give such notice thereof as is required by the Act.
(f) A meeting called under sub-article (e) above by the requisitionists or any of them:

(i) shall be called in the same manner, as nearly as possible, as that in which
meetings are to be called by the Board, but
(ii) shall not be held after the expiration of three months from the date of the
deposit of the requisition;

Provided that nothing contained in clause (ii) of sub-article (f) shall be deemed to
prevent a meeting duly commenced before the expiry of the period of three
months aforesaid, from adjourning to some day after the expiry of that period.

(g) Where two or more persons hold any share or interest in the Company jointly, a
requisition or a notice calling a meeting, signed by one or some only of them
shall, for the purposes of this Article have the same force and effect as if it had
been signed by all of them.
(h) Any reasonable expense incurred by the requisitionists by reason of the failure of
the Board to call a meeting shall be repaid to the requisitionists by the Company
and any sum so repaid shall be retained by the Company out of any sums due or
to become due from the Company by way of fees or other remuneration for their
services to such of the Directors as were in default.
Notice period of General Meetings
87 (a) A General Meeting of the Company may be called by giving not less than 21
day’s notice in writing or through electronic mode subject to the Act and Rules
made there under
(b) A General Meeting may be called after giving shorter notice than that specified in
sub-article (a) above if consent is accorded thereto in writing or by electronic
mode by not less than ninety five percent of the members entitled to vote at such
meeting.

Provided that where any Members of the Company are entitled to vote only on some
resolution or resolutions to be moved at a Meeting and not on the others, those
Members shall be taken into account for the purposes of this sub-article in respect of the
former resolution or resolutions and not in respect of the latter.
Contents of Notice
88 (a) Every notice of a meeting of the Company shall specify the place, date and the day and
hour of the meeting and shall contain a statement of the business to be transacted
thereat.
Service of Notice to members etc
(b) Notice of every meeting of the Company shall be given:

(i) to every Member of the Company, in any manner authorised by Section 20 of the
Act, or in such other manner as may be permitted by the Central Government.

436
 (ii) to the persons entitled to a share in consequence of the death or insolvency of a
Member by sending it through the post in a prepaid letter addressed to them by
name or by the title of representatives of the deceased or assignees of the
insolvent or by any like description, at the address, if any, in India supplied for
the purpose by the persons claiming to be so entitled or until such an address has
been so supplied, by giving the notice in any manner in which it might have been
given if the death or insolvency had not occurred; and
(iii) to the Auditor or Auditors for the time being of the Company in the manner
authorised by Section 20 of the Act or in such other manner as may be permitted
by the Central Government in the case of any Member or Members of the
Company and
(iv) To every Director of the Company.

(c)The accidental omission to give notice to or the non-receipt of notice by any

Member or other person to whom it should be given shall not invalidate the
proceedings at the meeting.
Ordinary and Special businesses at General Meetings
89 (a) In the case of an Annual General Meeting, all business to be transacted at the
meeting shall be deemed special, with the exception of business relating to:

(i) the consideration of financial statements, and reports of the Board of

Directors and Auditors;
(ii) the declaration of a dividend;
(iii) the appointment of Directors in the place of those retiring; and
(iv) the appointment of and the fixing of remuneration of the Auditors.

(b) In the case of any other meeting, all business shall be deemed special.
Explanatory statement to be annexed to Notice; and its contents
(c) Where any items of business to be transacted at the meeting are deemed to be
special as aforesaid, there shall be annexed to the notice of the meeting a
statement setting out all material facts concerning each such item of business,
including in particular the nature of the concern or interest, financial or otherwise,
if any, in respect of each items therein, of every Director and the Manager, if any,
every other Key Managerial Personnel (KMP), and relatives of Directors,
Managers and Key Managerial Personnel; and any other information and facts
that may enable members to understand the meaning, scope and implications of
the items of business and to take decision thereon

Provided that where any item of special business as aforesaid to be transacted at a

meeting of the Company relates to, or affects any other Company, the extent of
shareholding interest in that other Company of every Promoter, Director, Manager, if
any, and every other key managerial personnel of the first mentioned Company shall
also be set out in the statement if the extent of such shareholding is not less than 2
(Two) per cent of the paid-up share capital of that Company.

(d) Where any item of business refers to any document, which is to be considered at
the meeting, the time and place where such document can be inspected shall be
specified in the statement aforesaid.
Ordinary and Special Resolutions
90 (a) A resolution shall be an ordinary resolution if the notice required under the Act
has been duly given and it is required to be passed by the votes cast, whether on a
show of hands, or electronically or on a poll, as the case may be, in favour of the
resolution, including the casting vote, if any, of the Chairman, by members who,
being entitled so to do, vote in person, or where proxies are allowed, by proxy or
by postal ballot, exceed the votes, if any, cast against the resolution by members,
so entitled and voting.
(b) A resolution shall be a Special Resolution when:

(i) the intention to propose the resolution as a Special Resolution has been duly
specified in the notice calling the General Meeting or other intimation given
to the Members of the resolution;
(ii) the notice required under the Act has been duly given of the General

437
 Meeting; and
(iii) the votes cast in favour of the resolution (whether on a show of hands, or on
a poll, or electronically, as the case may be), by Members who, being
entitled so to do, vote in person, or where proxies are allowed, by proxy, or
by postal ballot, are not less than three times the number of the votes, if any,
cast against the resolution by Members so entitled and voting.
Resolutions requiring special notice
91 (a) Where, by any provision contained in the Act or in these presents, special notice
is required of any resolution, notice of the intention to move such resolution shall
be given to the company by such number of members holding not less than one
percent of total voting power or holding shares on which such aggregate sum not
exceeding five lakh rupees, or as may be prescribed by the Act from time to time,
has been paid-up and the company shall give its members notice of the resolution
as per the provisions of Section 115 of the Act and Rules thereto.
(b) The company shall immediately after receipt of the notice, give its members
notice of the resolution at least seven days before the meeting, exclusive of the
day of dispatch of notice and day of the meeting, in the same manner as it gives
notice of any general meetings .
Board’s power to postpone or cancel General Meetings called but not commenced
92 (a) The Board shall have power for proper reasons and in the interest of the
company, to postpone any General Meeting called or convened but not actually
commenced, by giving due notice of postponement to those entitled to receive the
meeting notice. Further, no business shall be transacted at the postponed meeting
other than the business of the original meeting which is postponed. If any fresh
business is transacted at the postponed meeting, all Statutory / Regulatory
provisions as are applicable in the case of an original meeting with respect to
those business, shall be complied with.
(b) The Board shall have power to cancel a General Meeting (other than an Annual
General Meeting or an Extra Ordinary General Meeting called on requisition by
members), called or convened but not actually commenced, by giving due notice
of cancellation to those entitled to receive the meeting notice.
(c) Any exercise of power by the Board under the above sub-clauses to postpone or
cancel a General Meeting as the case may be, shall not be deemed to prejudice the
rights and obligations of any member or other interested parties.
PROCEEDINGS AT GENERAL MEETING
Quorum
93 (a) The quorum for general meeting shall be 30 (Thirty) members personally present

No business shall be transacted at any General Meeting unless the requisite quorum be
present when the Meeting proceeds to business.
Business confined to election of chairman while Chair is vacant
94 No business shall be discussed at any General Meeting except the election of a
Chairman whilst the Chair is vacant.
Chairman of General Meeting
95 (a) The Chairman, if any, of the Board shall preside as Chairman at every General
Meeting of the Company.
(b) If there be no Chairman or if at any meeting he shall not be present within 15
minutes after the time appointed for holding such meeting, or is unwilling to act,
the Managing Director shall be entitled to act as the Chairman of such meeting
failing which the Non-Rotational Directors present may choose one of their
number to act as Chairman of the meeting and in default of their doing so, the
Members present shall choose one of the Directors to take the Chair and if no
Directors present be willing to take the Chair, the Members present shall choose
one of their number to be the Chairman of the meeting.
Adjournment of meeting when quorum not present
96 If within half an hour from the time appointed for the General Meeting, a quorum be not
present, the meeting, if convened on the requisition of shareholders, shall be dissolved
and in any other case, shall stand adjourned to the same day in the next week, at the
same time and place or to such other date and to such other day and at such other time
and place as the Directors may determine. If at such adjourned meeting also, a quorum,
be not present within half an hour from the time appointed for holding the meeting, the

438
 Members present shall be a quorum and may transact the business for which the
meeting was called.
Adjournment of meeting
97 (a) The Chairman may, with the consent of any meeting at which a quorum is
present, and shall, if so directed by the meeting, adjourn the meeting from time to
time, and from place to place.
(b) No business shall be transacted at any adjourned meeting other than the business
left unfinished at the meeting from which the adjournment took place.
(c) When a meeting is adjourned for more than 30 days, notice of the adjourned
meeting shall be given as in the case of an original meeting.
(d) Save as aforesaid and as provided in Section 103 of the Act, it shall not be
necessary to give any notice of the adjournment or of the business to be
transacted at an adjourned Meeting.
Proof of resolution passed by show of hands
98 (a) At any general meeting, a resolution put to the vote of the meeting shall, unless a
poll is demanded as per the Act or the voting is carried out electronically, be
decided on a show of hands.
(b) A declaration by the Chairman of the meeting of the passing of a resolution or
otherwise by show of hands under sub clause (a) and an entry to that effect in the
books containing the minutes of the meeting of the company shall be conclusive
evidence of the fact of passing of such resolution or otherwise.
Demand for poll
99 (a) Subject to Section 109 of the Act and the Rules made there under, before or on
the declaration of the result of the voting on any resolution on a show of hands, a
poll may be ordered to be taken by the Chairman of the Meeting of his own
motion and shall be ordered to be taken by him on a demand made in that behalf
by any Member or Members present in person or by proxy :

(i) and having not less than one-tenth of the total voting power or
(ii) holding shares on which an aggregate sum of not less than five lakh rupees or
such higher amount as may be prescribed by the Act and Rules thereto from
time to time, has been paid-up; or

(b) The demand for a poll may be withdrawn at any time by the person who made the
demand.
Time of taking poll
100 (a) If found necessary, if a poll is demanded on the election of a Chairman or on a
question of adjournment of meeting, it shall be taken forthwith and without
adjournment.
(b) A poll demanded on any other question shall be taken at such time not being later
than 48 hours from the time when the demand was made, as the Chairman may
direct.
Right of member to use his votes differently
101 On a poll taken at a meeting of the Company, a Member entitled to more than one vote
or his proxy or other person entitled to vote for him as the case may be, need not, if he
votes, use all his votes or cast in the same way all the votes he uses.
Scrutineers at poll
102 (a) Where a poll is to be taken, the Chairman of the Meeting shall appoint such
number of persons, as he deems necessary, to scrutinize the poll process and
votes given on the poll and to report thereon to him.
(b) The Chairman shall have power, at any time before the result of the poll is
declared, to remove a scrutineer from office and to fill vacancies in the office of
the scrutineer arising from such removal or from any other cause.
(c) Of the two scrutineers appointed under this Article, one shall always be a
Member (not being an officer or employee of the Company) present at the
meeting, provided that such a Member is available and willing to be appointed.
Manner of taking poll and result thereof
103 (a) Subject to the provisions of the Act, the Chairman of the meeting shall have
power to regulate the manner in which a poll shall be taken.
(b) The result of the poll shall be deemed to be the decision of the meeting on the
resolution on which the poll was taken.

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Chairman’s casting vote in case of equality of votes
104 In the case of an equality of votes, whether on a show of hands or on a poll, the
Chairman of the meeting at which the show of hands takes place or at which the poll is
demanded, shall be entitled to a casting vote in addition to his own vote or votes to
which he may be entitled as a Member.
Demand for poll not to prevent transaction of other businesses
105 The demand for a poll shall not prevent the continuance of a meeting for the transaction
of any business other than the item on which the poll has been demanded.
Minutes of General Meetings
106 The Company shall cause Minutes of all proceedings of General Meetings to be entered
in books kept for that purpose. The Minutes of each meeting shall contain a fair and
correct summary of the proceedings thereat. All appointments of officers made at any of
the meetings shall be included in the Minutes of the meeting. Any such Minutes, if
purporting to be signed by the Chairman of the meeting at which the proceedings took
place or in the event of death or inability of that Chairman, by a Director duly
authorised by the Board for the purpose, shall be evidence of the proceedings.
Inspection of Minutes Book
107 The books containing Minutes of proceedings of General Meetings of the Company or
of a resolution passed by postal ballot shall be kept at the Registered Office of the
Company and shall be open to the inspection of any Member without charge, between
11 a.m. and 1 p.m. on all business days.
Members’ right to obtain Minutes
108 Any member shall be entitled to be furnished, within seven working days or such other
period as prescribed by the Act and Rules thereto from time to time, after he has made a
request in that behalf to the company, with a copy of any minutes of any general
meeting, on payment of Rs10 (Rupees Ten Only ) or such other amount as prescribed
by the Act and Rules thereto from time to time, for each page or part of any page .
Participation of members in meetings through electronic mode
109 The members may also participate in meetings through electronic mode if and when the
said facility is provided by the company, subject to the Rules and Regulations as may be
notified by the Central Government from time to time.
VOTES OF MEMBERS
Entitlement to votes
110 Subject to the provisions of Section 47 of the Act :

(a) every member of the company holding equity share capital therein, shall have a
right to vote on every resolution placed before the company; and
(b) his voting right on a poll shall be in proportion to his share in the paid-up equity
share capital of the company.

Provided that the voting rights shall be subject to ceiling on total voting rights as
prescribed by the Reserve Bank of India from time to time under the Banking Act.
Provided that the Member may cast his vote on physical ballot or through electronic
mode as stipulated under the Act and Rules thereto.
Votes of joint holders
111 In the case of joint holders, the vote of the senior who tenders a vote, whether in person
or by proxy, shall be accepted to the exclusion of the votes of the other joint holders.
For this purpose, seniority shall be determined by the order in which the names stand in
the register of members.
Voting by members of unsound mind
112 A Member of unsound mind or in respect of whom an order has been made by any court
having jurisdiction in lunacy may vote, whether on a show of hands or on a poll, by his
committee or other legal guardian and any such committee or guardian may, on a poll,
vote by proxy.
Voting by corporate members
113 A Body Corporate (whether a company within the meaning of the Act or not) may, if it
is a Member, by resolution of its Board of Directors or other governing body, authorize
such person as it thinks fit to act as its representative at any meeting of the Company in
accordance with the provisions of Section 113 of the Act. The production at the meeting
, of a copy of such resolution duly signed by one Director of such Body Corporate or by
a member of its governing body and certified by him as being a true copy of the

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 resolution shall be accepted by the Company as sufficient evidence of the validity of his
appointment.
Votes in respect of shares of deceased members
114 Any person entitled under the Transmission Clause to transfer any shares may vote at
the General Meetings in respect thereof as if he was the registered holder of such shares
provided that atleast 48 hours before the time of holding the meeting or adjourned
meeting as the case may be at which he proposes to vote, he shall satisfy the Directors
of his right to transfer such shares unless the Directors shall have previously admitted
his right to vote at such meeting in respect thereof.
Proxy
115 (a) Any Member of the Company entitled to attend and vote at a meeting of the
Company shall be entitled to appoint another person (whether a Member or not)
as his proxy to attend and vote instead of himself but a proxy so appointed shall
not have any right to speak at the meeting.
(b) In every notice calling a meeting of the Company, there shall appear with
reasonable prominence a statement that a Member entitled to attend and vote is
entitled to appoint a proxy to attend and vote instead of himself and that a proxy
need not be a Member.
Manner of voting
116 Votes may be given either personally or by attorney or by proxy or, in the case of a
Body Corporate, by a representative duly authorised as aforesaid.
Execution of proxy and format thereof
117 Every instrument of proxy whether for a specified meeting or otherwise shall be in
writing under the hand of the appointer or his attorney authorised in writing or if such
appointer is a Body Corporate, under its Common Seal or the hand of an officer or an
attorney duly authorised by it and shall, as nearly as circumstances will admit, be in the
form specified in the Rules made under Section 105 of the Act.
Deposit of proxy etc and their inspection
118 No person shall act as proxy unless the instrument of his appointment and the power of
attorney or other authority, if any, under which it is signed or a notarially certified copy
of that power or authority shall have been deposited at the Office atleast 48 hours before
the time for holding the meeting at which the person named in the instrument of proxy
proposes to vote and in default the instrument appointing the proxy shall not be treated
as valid. No attorney shall be entitled to vote unless the power of attorney or other
instrument appointing him as attorney or a notarially certified copy thereof has either
been registered in the records of the Company at any time not less than 48 hours before
the time of the meeting at which the attorney proposes to vote or is deposited at the
Office not less than 48 hours before the time of such meeting as aforesaid.
Notwithstanding that a power of attorney or other authority has been registered in the
records of the Company, the Company may by notice in writing addressed to the
Member or the attorney atleast seven days before the date of a meeting require him to
produce the original Power of Attorney or authority and unless the same is thereupon
deposited with the Company not less than 48 hours before the time fixed for the
meeting, the attorney shall not be entitled to vote at such meeting unless the Directors,
at their absolute discretion, excuse such non-production and deposit. Every Member
entitled to vote at a meeting of the Company or on any resolution to be moved there at
shall be entitled during the period beginning 24 hours before the time fixed for the
commencement of the meeting and ending with the conclusion of the meeting to inspect
the proxies lodged at any time during the business hours of the Company provided that
not less than three days notice in writing of the intention so to inspect is given to the
Company.
Custody of the instrument
119 If any such instrument of appointment be confined to the object of appointing a proxy
or substitute for voting at meetings of the Company, it shall remain permanently or for
such time as the Board may determine, in the custody of the Company and if embracing
other objects, a copy thereof, examined with the original, shall be delivered to the
Company to remain in the custody of the Company.
Validity of votes given by proxy notwithstanding death of member etc
120 A vote given in accordance with the terms of an instrument of proxy shall be valid
notwithstanding the previous death of the principal or revocation of the proxy or of any
Power of Attorney under which such proxy was signed or the transfer of the share in

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 respect of which the vote is given, provided that no intimation in writing of the death,
revocation or transfer shall have been received at the Office of the Company before the
meeting.
Objection to validity of votes
121 No objection shall be made to the validity of any vote except at the meeting or poll at
which such vote shall be tendered and every vote whether given personally or by proxy
not disallowed at such meeting or poll, shall be deemed valid for all purposes of such
meeting or poll whatsoever.
Chairman to decide on validity of votes
122 The Chairman of any meeting shall be the sole judge of the validity of every vote
tendered at such meeting. The Chairman present at the taking of a poll shall be the sole
judge of the validity of every vote tendered at such poll.
Pari passu rights of members of the same class
123 Any Member whose name is entered in the Register of Members of the Company shall
enjoy the same rights and be subject to the same liabilities as all other Members of the
same class.
No voting right on share having dues or subject to lien
124 No member shall exercise any voting right in respect of any shares registered in his
name on which any calls or other sums presently payable by him have not been paid or
in regard to which the company has, and has exercised, any right of lien
DIRECTORS
Number of Directors
125 The number of directors of the company shall not be less than five and more than12
(twelve) until otherwise determined by the company in general meeting. Not less than
fifty one percent of the total number of directors shall be persons who satisfy the
conditions laid down in Section 10A of the Banking Regulation Act, 1949.
First Directors
126 The First Directors of the Company shall be :

1. Shri. Chakkola Palu Lonappen

2. Shri. Alangattukaren Devassy Kuriappen
3. Shri. Maliammavu Lona Mathew
4. Shri. Kattukaren Varunny Ouseph
5. Shri. Chalissery Anthony Mani
6. Shri. Chettupuzhakkaren Kunjuvareed Varied
7. Shri. Injodikkaren Inasu Iyyappen
8. Shri. Chalakkal Rappai Iyyunni
9. Shri. Attokaren Pyloth Varunny
10. Shri. Maliakkal Devassy Pyloth
11. Shri. Erinjery Varunny Ouseph
Retiring Directors
127 Subject to the provisions of the Act,

(i) Not less than Two thirds of the total number of directors shall be persons whose
period of office is liable to determination by retirement of directors by rotation
and shall be appointed by the company in general meeting. Total number of
directors for this purpose shall not include independent directors, whether
appointed under the Act or any other law for the time being in force
Non –Rotational Directors
(ii)The remaining number of directors including the Chairman, Managing Director
and whole time director, but not exceeding one-third of the total number of
directors, may be appointed by the Board of directors and shall not be liable to
retirement by rotation of directors, nor taken into account in determining the
retirement of directors by rotation. The directors including the Chairman,
Managing Director and whole time Director so appointed by the Board shall be
persons who possess one or more of the qualifications specified in Section 10 A
(2)(a) of the Banking Regulation Act, 1949.
Termination of appointment of Non Rotational Directors
Provided that subject to covenants, if any, the Board shall have power to terminate the
appointment of any non- rotational director appointed by the Board under this sub-
clause, before the expiry of his term of appointment.

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No qualification shares for Directors’
128 No director shall be required to hold any qualification shares in the Bank.
Appointment of additional director
129 The Board shall have power at any time and from time to time, to appoint a person as
an additional director, provided the number of the directors and the additional director
together shall not at any time exceed the maximum strength fixed for the Board by the
Articles. Such person shall hold office only up to the date of the next annual general
meeting of the company, but shall be eligible for appointment by the company as a
director at that meeting subject to the provisions of the Act.
Appointment of director in casual vacancy
130 Subject to the provisions of Section 161 of the Act and Rules made there under any
statutory amendment or modification thereto, if the office of any director appointed by
the company in General Meeting is vacated before his term of office will expire in the
normal course, the resulting casual vacancy may be filled up by the Board of Directors
at a meeting of the Board.
Appointment of alternate director
131 Subject to the provisions of Section 161 of the Act and any statutory amendment or
modification thereto, the Board shall have power at any time and from time to time to
appoint a person as Alternate Director to Act for a director during the latter director’s
absence for a period of not less than three months from India.

Subject to the provisions of Section 161 of the Act and Rules made there under and any
statutory amendment or modification thereto, the Board may appoint any person as a
director nominated by any institution in pursuance of the provisions of any law for the
time being in force or of any agreement.
Payment of sitting fees and expenses to directors
132 (a) Every director including Chairman but excluding the managing director or the
whole time director attending meetings of the Board of Directors or of their
Committees, shall be entitled to and be paid such sitting fee per sitting of the
Board of Directors or of their Committees as the Board may from time to time
determine within the ceiling, if any, prescribed under the Act or Rules made there
under. They shall also be entitled to and be paid such travelling, hotel and other
expenses as may reasonably be incurred by them in the execution of their duties
including any such expenses incurred in connection with their attendance at
meetings of the Board of directors or of their Committees or in connection with
the business and affairs of the company. No director who is in service of the
government or Regulatory Body shall be entitled to receive any sitting fees ,
allowances or remuneration under this article or other provisions of these presents
except as authorised by the Government / Regulatory Body.

Payment of remuneration to directors for extra services rendered

(b) If any director other than the Managing Director shall be called upon to advise the
company as an expert or be called upon to perform extra services for the
company, the company shall pay to such director such special remuneration as the
Board shall deem fit in accordance with statutory provisions.
Disqualifications for appointment and continuing to hold appointment as director
133 No person shall be qualified to be a Director if his appointment is in contravention of
any law or guideline in force or if by amendment of any law or guideline, his
continuance in office is in contravention of such law or guideline, he shall immediately
vacate his office; on such vacation he shall not be entitled to any compensation.
How Directors to act in the absence of quorum
134 Subject to the provisions of the Act, the continuing directors may act notwithstanding
any vacancy in the Board; but, if and so long as their number is reduced below the
quorum fixed by the Act for a meeting of the Board, the continuing directors or director
may act for the purpose of increasing the number of directors to that fixed for the
quorum, or of summoning a general meeting of the company and for no other purpose.
Vacation of office of the director
135 The office of a director shall become vacant in case —

(a) he incurs any of the disqualifications specified in Section 164 of the Act;
(b) he absents himself from all the meetings of the Board of Directors held during a

443
 period of twelve months with or without seeking leave of absence of the Board;
(c) he acts in contravention of the provisions of Section 184 of the Act relating to
entering into contracts or arrangements in which he is directly or indirectly
interested;
(d) he fails to disclose his interest in any contract or arrangement in which he is
directly or indirectly interested, in contravention of the provisions of Section 184
of the Act;
(e) he becomes disqualified by an order of a court or the Tribunal;
(f) he is convicted by a court of any offence, whether involving moral turpitude or
otherwise and sentenced in respect thereof to imprisonment for not less than six
months:

Provided that the office shall be vacated by the director even if he has filed an appeal
against the order of such court;

(g) he is removed in pursuance of the provisions of the Act;

(h) he, having been appointed a director by virtue of his holding any office or other
employment in the holding, subsidiary or associate company, ceases to hold such
office or other employment in that company.
(i) he resigns office by notice in writing addressed to the Company or to the Board;
(j) he is disqualified from being appointed or continuing to hold appointment as a
Director under any of the provisions of the said Acts, Rules, Regulations and
Guidelines
ROTATION OF DIRECTORS
Proportion of directors to retire by rotation
136 At every Annual General Meeting of the Company, one third of such Directors for the
time being as are liable to retire by rotation as per article 127(i) or if their number is not
three or a multiple of three, then the number nearest to one-third, shall retire from
office.
Determination of directors to retire by rotation
137 The Directors to retire by rotation at every Annual General Meeting shall be those who
have been longest in office since their last appointment, but as between persons who
became Directors on the same day, those who are to retire shall (unless they otherwise
agree among themselves) be determined by lot.
Retiring director eligible for re-election
138 A retiring Director shall be eligible for re-election.
Company to fill up vacancy
139 The Company, at the Annual General Meeting at which a Director retires in the manner
aforesaid, may fill up the vacated office by appointing the retiring Director or some
other person in his place.
Deemed re- appointment of the retiring director
140 If the place of the retiring Director is not so filled up and the meeting has not expressly
resolved not to fill the vacancy, the meeting shall stand adjourned till the same day in
the next week, at the same time and place, or if that day is a national holiday, till the
next succeeding day which is not a holiday, at the same time and place, and if at the
adjourned meeting also, the place of the retiring Director is not filled up and that
meeting also has not expressly resolved not to fill the vacancy, the retiring Director
shall be deemed to have been re-appointed at the adjourned meeting, unless:

(i)at that meeting or at the previous meeting, a resolution for the re-appointment of
such Director has been put to the meeting and lost;
(ii) the retiring Director has, by a notice in writing addressed to the Company or the
Board of Directors, expressed his unwillingness to be so re-appointed;
(iii) he is not qualified or is disqualified for appointment;
(iv) a Resolution, whether Special or Ordinary, is required for his appointment or re-
appointment by virtue of any provisions of the Act.
(v) Section 162 shall be applicable to any such appointment.
Appointment of directors to be voted on individually
141 (a) At a general meeting of a company, a motion for the appointment of two or more
persons as directors of the company by a single resolution shall not be moved
unless a proposal to move such a motion has first been agreed to at the meeting

444
 without any vote being cast against it.
(b) A resolution moved in contravention of sub-article (a) above shall be void
whether or not any objection was taken at the time to its being so moved.
(c) For the purposes of this Article, a motion for approving a person’s appointment or
for nominating a person for appointment as a Director shall be treated as a motion
for his appointment.
Right of persons other than retiring directors, to stand for directorship
142 (a) Subject to the provisions of the said Acts and these presents, a person who is not a
retiring director shall, subject to the provisions of the Act, be eligible for appointment to
the office of a director at any general meeting, if he, or some member intending to
propose him as a director, has, not less than fourteen days before the meeting, left at the
registered office of the company, a notice in writing under his hand signifying his
candidature as a director or, as the case may be, the intention of such member to
propose him as a candidate for that office, along with the deposit of such amount as
prescribed by the Act and Rules thereto which shall be refunded to such person or, as
the case may be, to the member, if the person proposed gets elected as a director or gets
more than twenty-five per cent of total valid votes cast either on show of hands or on
poll on such resolution.
Company to inform members, of the candidature or proposal
(b) The company shall, at least seven days before the general meeting, inform its members
of the candidature of a person for the office of a director or the intention of a member to
propose such person as a candidate for that office-

(i) by serving individual notices, on the members through electronic mode to such
members who have provided their email addresses to the company for
communication purposes, and in writing to all other members; and
(ii) by placing notice of such candidature or intention on the website of the company,
if any

Provided that it shall not be necessary for the company to serve individual notices upon
the members as aforesaid, if the company advertises such candidature or intention, not
less than seven days before the meeting atleast once in a vernacular newspaper in the
principal vernacular language of the district in which the registered office of the
company is situated, and circulating in that district, and atleast once in English language
in an English newspaper circulating in that district
Appointment and retirement of directors, to be in compliance with Law
(c) The Board shall ensure that the appointment ofDirectors ofthe Company in General
Meeting and appointment of the Non-rotational Directors, and their retirement shall be
in accordance with the provisions of the said Acts.
Consent of candidate for directorship , to be filed with the Company
(d) Every person who has been appointed to hold the office of a director shall on or before
the appointment furnish to the company a consent in writing to act as such.
Removal of directors
143 (a) Subject to the provisions of Section 169 of the Act, the Company may by
Ordinary Resolution remove a Director before the expiry of his period of office
after giving him a reasonable opportunity of being heard. Nothing in this sub-
clause shall be taken as derogating from any power to remove a director which
may exist in these presents apart from this sub-clause.
(b) Special Notice shall be required of any resolution to remove a Director under this
Article or to appoint somebody instead of a Director so removed at the meeting at
which he is removed.
(c) On receipt of notice of a resolution to remove a Director under this Article, the
Company shall forthwith send a copy thereof to the Director concerned, and the
Director (whether or not he is a Member of the Company) shall be entitled to be
heard on the resolution at the meeting.
(d) Where notice has been given of a resolution to remove a director under this
Article and the director concerned makes with respect thereto representation in
writing to the company and requests its notification to members of the company,
the company shall, if the time permits it to do so,—

(i) in any notice of the resolution given to members of the company, state the
fact of the representation having been made; and

445
 (ii) send a copy of the representation to every member of the company to whom
notice of the meeting is sent (whether before or after receipt of the
representation by the company), and if a copy of the representation is not
sent as aforesaid due to insufficient time or for the company’s default, the
director may without prejudice to his right to be heard orally require that the
representation shall be read out at the meeting.
Filling up of vacancy caused by the removal of director
(e) A vacancy created by the removal of a Director under this Article may, if he had
been appointed by the Company in General Meeting or by the Board, be filled by
the appointment of another Director in his stead, by the meeting at which he is
removed, provided Special Notice of the intended appointment has been given
under sub-article (b) above. A Director so appointed shall hold office until the
date up to which his predecessor would have held office if he had not been
removed as aforesaid.
Prohibition on re¬appointment of removed director, by the Board
(f) If the vacancy is not filled under sub-article (e) of this Article, it may be filled as
a casual vacancy in accordance with the provisions of the Act

Provided that the Director who was removed from office shall not be reappointed as a
Director by the Board of Directors.
CHAIRMAN MANAGING DIRECTOR WHOLE-TIME DIRECTOR – EXECUTIVE DIRECTOR
Board to appoint Chairman, Managing Director, Whole time Director, Executive director
144 (a) Subject to the provisions of the said Acts and these presents, the Board of Directors of
the Company shall be entitled to appoint from time to time, one or more of the Non-
Rotational Directors to act as Part-time Chairman OR a Managing Director or
Managing Director(s) and/or Whole-time Director or Whole-time Director(s) of the
Company for such term not exceeding five years at a time as the Board of Directors
may think fit, but shall be eligible for re-appointment. Subject to provisions of any
contract between him / them and the Company, the Board may also remove or dismiss
him or them from office and appoint another in his / their place. The Managing Director
shall be the Chief Executive Officer of the company under its whole time employment,
and shall be entrusted with the management of the whole of the affairs of the
Company.Subject to the provisions of the said Acts and these presents, the Part time
Chairman or the Managing Director shall not, while he continues to hold that office, be
subject to retirement by rotation but he shall be subject to the provisions of any contract
between him and the Company and be subject to the same provisions as to
disqualification, removal, vacation or resignation of office of director as are applicable
to the other Directors of the Company and he shall ipso facto and immediately cease to
be Part time Chairman or Managing Director if he ceases to hold the office of Director
from any cause.
Remuneration of part time Chairman, Managing Director etc
(b) The remuneration of the Part-time Chairman, Managing Director or Whole-time
Director shall (subject to Section 197 of the Act and other applicable provisions of the
said Acts and these Articles and of any contract between him and the Company) be
fixed by the Board, from time to time and may be by way of fixed salary and/or
perquisites or commission on profits of the Company or by participation in such profits
or by any or all these modes or any other mode not expressly prohibited by the Act.
Payment of remuneration shall be subject to shareholders’ approval in General Meeting
(c) Subject to the provisions of the said Acts payment of remuneration to the Part time
Chairman or Managing Director or Whole time Director shall be subject to approval of
the Company in General Meeting.
Functions and role of Managing Director
(d) Subject to the superintendence, control and direction of the Board, the day-today
management of the Company shall be in the hands of the Managing Director, with
power to the Board to distribute such day-to-day management functions in any manner
as deemed fit by the Board, subject to the provisions of the said Acts and these presents,
and shall have the general direction, management and superintendence of the whole
business of the company with power to do all Acts, matters and things deemed
necessary, proper and expedient for carrying on the business of the company and
generally to exercise all such powers and authorities of the company as are not by the
Companies Act or by these regulations expressly directed to be exercised only by the

446
 Board of Directors or by the company in general meeting.
Terms of appointment of part time chairman
(e) The Part time chairman of the Board may be paid remuneration for the performance of
duties attached to his office, and allowed payment of incidental expenses as may
reasonably be incurred by him in the execution of his duties, subject to and in
accordance with the provisions of the Act, the Banking Regulation Act, 1949 and other
applicable Regulations. The tenure, terms and conditions of appointment of part time
chairman may be decided by the Board of Directors subject to the provisions of this
article.
Appointment of Executive Director
(f) Subject to the provisions of these Articles, the Act and the Banking Regulation Act,
1949, one or more of the non-rotational directors appointed under Article 127(ii) of
these articles, apart from the Chairman, Managing Director/ Whole time Director, may
be appointed in the whole-time employment of the company to assist the Managing
Director/ Whole time Director in the management of the company’s affairs, in the
designation of Executive Director or such other designation and on such terms and
conditions as may be decided by the Board.
Delegation of powers by Part-time chairman/ Managing Director
145 The Part-time Chairman or the Managing Director may, with the sanction of the Board,
delegate all or any of his powers to such Managers, Secretaries and other delegates as
the Board may think fit and shall have power to grant such Managers, secretaries and
other delegates such power of attorney as the Board may think expedient and such
powers at pleasure to revoke.
PROCEEDINGS OF DIRECTORS’ MEETINGS
Meetings of directors
146 The Directors may meet together for the dispatch of business, adjourn and otherwise
regulate their meetings and proceedings as they think fit:
Periodicity of meeting
Provided, however, the company shall hold a minimum number of four meetings of its
Board of Directors every year in such a manner that not more than one hundred and
twenty days shall intervene between two consecutive meetings of the Board.
Convening of Board Meeting and on requisition
147 The Chairman may at any time and the Manager, Secretary or such other officer of the
Company as may be authorised by the Board, shall upon the requisition of one- third
number of members of the Board as are in office, convene a meeting of the Board. If,
within 15 days of the requisition in writing to convene a meeting of the Board, the
chairman or the authorised official fails to convene the meeting, the requisitionists
themselves may convene a meeting of the Board.
Notice of Meetings
148 A meeting of the Board shall be called by giving not less than seven days’ notice in
writing to every director at his address registered with the company and such notice
shall be sent by hand delivery or by post or by electronic means.

Provided that a meeting of the Board may be called at shorter notice to transact urgent
business subject to the condition that atleast one independent director, if any, shall be
present at the meeting:

Provided further that in case of absence of independent directors from such a meeting of
the Board, decisions taken at such a meeting shall be circulated to all the directors and
shall be final only on ratification thereof by atleast one independent director, if any
Quorum
149 Subject to Section 174 of the Act, the quorum for a meeting of the Board shall be one-
third of its total strength excluding Directors, if any, whose places may be vacant at the
time and any fraction contained in that one-third being rounded off as one, or two
Directors, whichever is higher and the participation of the directors by video
conferencing or by other audio visual means shall also be counted for the purposes of
quorum;

Provided that where at any time the number of interested directors exceeds or is equal to
two thirds of the total strength of the Board of Directors, the number of directors who
are not interested directors and present at the meeting, being not less than two, shall be

447
 the quorum during such time.

For the purposes of this Article:

(i) “total strength” shall not include directors whose places are vacant;
(ii) “interested Director” means a director within the meaning of sub-Section (2) of
Section 184 of the Act.
Adjournment of meetings for want of quorum
150 (a) If a meeting of the Board could not be held for want of quorum, then, the meeting
shall automatically stand adjourned to the same day at the same time and place in
the next week or if that day is a national holiday, till the next succeeding day,
which is not a national holiday, at the same time and place.
(b) The provisions of Article 146 shall not be deemed to have been contravened
merely by reason of the fact that a meeting of the Board which had been called in
compliance with the terms of that Article could not be held for want of a quorum.
Board’s power to delegate to committees.
151 The Board may subject to the provisions of the Act, delegate any of their powers to
Committees consisting of Directors and/or such other person or persons as they think
fit, and they may from time to time revoke and substitute such delegation. Any
Committee so formed shall in the exercise of the powers so delegated, conform to any
regulations that may from time to time be imposed on it by the Board. All acts done by
any such Committee in conformity with such regulations and in fulfilment of the
purposes of its appointment but not otherwise, shall have the force and the effect as if
done by the Board.
Meetings of committees
152 The meetings and proceedings of any such Committee shall be governed by the
provisions of these presents for regulating the meetings and proceedings of the
Directors, so far as the same are applicable thereto and are not superseded by any
regulations made by the Directors under Article 151.
Meetings to be presided by Chairman
153 (a) All meetings of the Board shall be presided over by the Chairman if present, but if at
any meeting of Board, the Chairman be not present, at the time appointed for holding
the same, then and in that case the Managing Director shall be entitled to be the
Chairman of such meeting, failing which the Board shall choose one among them, then
present to preside at the meeting.

Manner of taking decisions at Board Meetings

(b) Subject to the provisions of Sections 203 of the Act, any question arising at any meeting
of the Board shall be decided by a majority of votes and in case of equality of votes, the
Chairman shall have second or casting vote.
Exercising of Board’s Powers
154 The meeting of the Board of Directors for the time being at which quorum is present,
shall be able to exercise all or any of the authorities, powers and discretion which by or
under the Act or these presents are vested in or exercisable by the Board of Directors
generally.
Powers to be exercised only at Board Meetings
155 The Board shall exercise the following powers on behalf of the Company, and it shall
do so only by means of resolutions passed at its meetings:

(a) to make calls on shareholders in respect of money unpaid on their shares;

(b) to authorise buy-back of securities under Section 68 of the Act;
(c) to issue securities, including debentures, whether in or outside India;
(d) to borrow monies;
(e) to invest the funds of the company;
(f) to grant loans or give guarantee or provide security in respect of loans;
(g) to approve financial statement and the Board’s report;
(h) to diversify the business of the company;
(i) to approve amalgamation, merger or reconstruction;
(j) to take over a company or acquire a controlling or substantial stake in another
company;
(k) to make political contributions;

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 (l) to appoint or remove key managerial personnel (KMP);
(m) to take note of appointment(s) or removal(s) of one level below the Key
Management Personnel;
(n) to appoint internal auditors and secretarial auditor;
(o) to take note of the disclosure of director’s interest and shareholding;
(p) to buy, sell investments held by the company (other than trade investments),
constituting five percent or more of the paid up share capital and free reserves of
the investee company;
(q) to invite or accept or renew public deposits and related matters;
(r) to review or change the terms and conditions of public deposit;
(s) to approve quarterly, half yearly and annual financial statements or financial
results as the case may be.

Provided that the Board may, by a resolution passed at a meeting, delegate to any
committee of directors, the managing director, the manager or any other principal
officer of the company or in the case of a branch office of the company, the principal
officer of the branch office, the powers specified in clauses (d) to (f) on such conditions
as it may specify:

Provided further that the acceptance by the bank in the ordinary course of its business of
deposits of money from the public repayable on demand or otherwise and withdrawable
by cheque, draft, order or otherwise, or the placing of monies on deposit by the bank
with another banking company on such conditions as the Board may prescribe, shall not
be deemed to be a borrowing of monies or, as the case may be, a making of loans by a
bank within the meaning of this Section.

Nothing in clause (d) shall apply to borrowings by the bank from other banking
companies or from the Reserve Bank of India, the State Bank of India or any other
banks established by or under any Act.

In respect of dealings between the company and its bankers, the exercise by the
company of the power specified in clause (d) shall mean the arrangement made by the
company with its bankers for the borrowing of money by way of overdraft or cash
credit or otherwise and not the actual day-to-day operation on overdraft, cash credit or
other accounts by means of which the arrangement so made is actually availed of.
Powers to be exercised with the consent of the company in General Meeting
156 (a) Subject to the provisions of Section 180 of the Act, The Board of Directors of a
company shall exercise the following powers only with the consent of the
company by a special resolution, namely:

(i) to sell, lease or otherwise dispose of the whole or substantially the whole of
the undertaking of the company or where the company owns more than one
undertaking, of the whole or substantially the whole of any of such
undertakings.
(ii) to invest otherwise in trust securities the amount of compensation received
by it as a result of any merger or amalgamation.
(iii) to borrow money, where the money to be borrowed, together with the money
already borrowed by the company will exceed aggregate of its paid-up share
capital and free reserves, apart from temporary loans obtained from the
company’s bankers in the ordinary course of business:

Provided that the acceptance by the bank, in the ordinary course of its business, of
deposits of money from the public, repayable on demand or otherwise, and
withdrawable by cheque, draft, order or otherwise, shall not be deemed to be
borrowing of monies by the bank within the meaning of this clause.

For the purposes of this clause, the expression “temporary loans”means loans
repayable on demand or within six months from the date of the loan such as
short-term, cash credit arrangements, the discounting of bills and the issue of
other short-term loans of a seasonal character, but does not include loans raised
for the purpose of financial expenditure of a capital nature;

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 (iv) to remit, or give time for the repayment of, any debt due from a director.

(b) The Board shall contribute to bona fide charitable and other funds, to any political
party and to the National Defence Fund or any other Fund approved by the
Central Government for the purpose of national defence etc. in accordance with
the provisions of Section 181, 182 and 183 of the Act.
Acts of Board / committees valid not withstanding defect in appointment of directors
157 All acts done by any meeting of the Board or of a Committee thereof or by any person
acting as a Directors, shall be valid notwithstanding that it may be afterwards
discovered that the appointment of any one or more of such Directors or of any person
acting as aforesaid, was invalid by reason of defect or disqualification or had terminated
by virtue of any provision contained in the Act or these presents. Provided that nothing
in this Article shall be deemed to give validity to acts done by a Directors after his
appointment has been shown to the Company to be invalid or to hace terminated.
Passing of Resolution by circulation
158 (a) No resolution shall be deemed to have been duly passed by the Board or by a
committee thereof by circulation, unless the resolution has been circulated in
draft, together with the necessary papers, if any, to all the directors, or members
of the committee, as the case may be, at their addresses registered with the
company in India by hand delivery or by post or by courier, or through electronic
means, and has been approved by a majority of the directors or members, who are
entitled to vote on the resolution.

Provided that, where not less than one-third of the total number of directors of the
company for the time being require that any resolution under circulation must be
decided at a meeting, the chairperson shall put the resolution to be decided at a meeting
of the Board

(b) A resolution under sub-clause (a) shall be noted at a subsequent meeting of the
Board or the committee thereof, as the case may be, and made part of the minutes
of such meeting.
Reconstitution of the Board so as to conform to Law
159 (a) If the requirements as to the constitution of the Board as laid down in any of the said
Acts are not fulfilled at any time, the Board shall reconstitute such Board so as to ensure
that such requirements are fulfilled.
Determination of directors to retire for the purpose of re-constitution of the Board
(b) If, for the purpose of reconstituting the Board under sub-article (a) above, it is necessary
to retire any Director or Directors, such Director/s shall be those who have been longest
in office, whether continuously or otherwise since their initial appointment to the Board,
and as between persons who have been initially appointed on the same day, the
Director/s to retire for the purpose of this article shall be determined by lot and such
decision shall be binding on every Director. The non-rotational Director/s, if any, on the
Board shall be excluded for the purpose of determination of retirement of Director/s
under this article
Board’s proceedings valid despite certain events.
(c) No act or proceeding of the Board of Directors of the Company shall be invalid by
reason only of any defect in the composition thereof or on the ground that it is
subsequently discovered that any of its Members did not fulfil the requirements of this
Article.
Chairman of Committees
160 (a) A Committee may elect a chairman of its meetings
(b) If no such chairman is elected, or if at any meeting the chairman is not present at the
time appointed for holding the meeting, the members present may choose one of
their numbers to be the chairman of the meeting.
Adjournment and manner of taking committee decisions
161 (a) A committee may meet and adjourn as it thinks it in accordance with the
provisions of the Act.
(b) Question arising at any meeting of committee shall be determined by a majority
of votes of members present, and in case of equality of votes, the chairman of the
meeting shall have a second or casting vote.
Meetings through electronic mode

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 162 The directors may also participate in their meetings through electronic mode
POWERS OF BOARD OF DIRECTORS
General powers of the company vested in the Board
163 (a) Subject to the provisions of the said Acts, the Board of Directors shall be entitled
to exercise all such powers and to do all such acts and things, as the Company is
authorised to exercise and do;

Provided that the Board shall not exercise any power to do any act or thing which is
directed or required, by any act or by the Memorandum or Articles of the Company or
otherwise, to be exercised or done by the Company in General Meeting.

Provided further that in exercising any such power or doing any such act or thing, the
Board shall be subject to the provisions contained in that behalf in any Act or in the
Memorandum or Articles of the Company or in any regulations not inconsistent
therewith and duly made thereunder including regulations made by the Company in
General Meeting.

(b) No regulation made by the Company in General Meeting shall invalidate any
prior act of the Board which would have been valid if that regulation had not been
made.
Specific powers given to Board
164 Without prejudice to the general powers conferred by the last preceding Article and the
other powers conferred by these presents but subject, however, to the provisions of the
Act, the Memorandum and these presents, it is hereby expressly declared that the Board
shall have the following powers:
To pay costs of incorporation
(a) To pay the costs, charges and expenses preliminary and incidental to the promotion,
formation, establishment and registration of the Company.
Seal abroad
(b) To have an Official Seal for use abroad.
Acquiring properties, rights etc
(c) To purchase or otherwise acquire for the Company any property rights or privileges
which the Company is authorised to acquire at such price and generally on such terms
and conditions as they think fit.
To pay for property, rights etc. acquired
(d) At their discretion to pay for any property or rights or privileges acquired by or services
rendered to the Company, either wholly or partially in cash or in shares, bonds,
debentures, debenture stock or other securities of the Company and any such shares
may be issued either as fully paid-up or with such amount credited as paid-up thereon as
may be agreed upon and any such bonds, debentures, debenture stock or other securities
may be either specifically charged upon all or any part of the property of the Company
and its uncalled capital or not so charged.
To insure properties.
(e) To insure and keep insured against loss or damage by fire or otherwise for such period
and to such extent as they may think proper all or any part of the buildings, machinery,
goods, stores, produce and other movable property of the Company either separately or
jointly; also to insure all or any portion of the goods, produce, machinery and other
articles imported or exported by the Company and to sell, assign, surrender or
discontinue any policies of assurance effected in pursuance of this power.
To open bank accounts
(f) To open accounts with any bank or bankers or with any company, firm or individual
and to pay money into and draw money from any such account from time to time as the
Board may think fit.
To secure contracts by mortgage
(g) To the extent permissible under the said Acts, to secure the fulfilment of any contracts
or engagements entered into by the Company by mortgage or charge of all or any of the
property of the Company and its uncalled capital for the time being or in such other
manner as they think fit.
To attach conditions for transfer of shares in certain cases
(h) To attach to any shares issued as the consideration or part of the consideration for any
contract with or property acquired by the Company or in payment for services rendered

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 to the Company, such conditions as to the transfer thereof as they think fit.
To accept surrender of shares
(i) To accept from any Member, on such terms and conditions as shall be agreed, a
surrender of his shares or stock or any part thereof.
To appoint trustees of property
(j) To appoint any person or persons (whether incorporated or not) to accept and hold in
trust for the Company any property belonging to the Company or in which it is
interested or for any other purposes and to execute and do all such acts and things as
may be requisite in relation to any such trust and to provide for the remuneration of
such trustee or trustees.
To institute and conduct legal proceedings
(k) To institute, conduct, defend, compound or abandon any legal proceedings by or against
the Company or its officers or otherwise concerning the affairs of the Company and also
to compound and allow time for payment or satisfaction of any debt due or of any
claims or demands by or against the Company.
To refer to arbitration
(l) To refer any claim or demand by or against the Company to arbitration and observe and
perform the awards.
To act in matter of bankruptcy
To act on behalf of the Company in all matters relating to bankruptcy and insolvency.

(m)
To give receipts / discharges
(n) To make and give receipts, releases and other discharges for monies payable to the
Company and for the claims and demands of the Company.
To determine company’s authorised signatory
(o) To determine from time to time who shall be entitled to sign on the Company’s behalf
bills, notes, receipts, acceptances, endorsements, cheques, dividend warrants, releases,
contracts and documents.
To invest company’s monies
(p) To invest and deal with any of the monies of the Company whether or not immediately
required for the purposes thereof, upon such securities and in such manner as they may
think fit and from time to time to vary or realize such investments.
To execute mortgage of company’s property
(q) To execute in the name and on behalf of the Company in favour of any Director or other
person who may incur or be about to incur any personal liability for the benefit of the
Company such mortgages of the Company’s property (present and future) as they think
fit and any such mortgage may contain a power of sale and such other powers,
covenants and provisions as shall be agreed on.
To give interest in particular business or transaction
(r) To give to any Director, officer or other person employed by the Company an interest in
any particular business or transaction or otherwise or a share in the general profits of the
Company and such interest, commission or share of profits shall be treated as a part of
the working expenses of the Company:

Provided that the share of general profits of the Company payable to the Directors or to
the officers of the Company or such other person shall not exceed the limits prescribed
under the Act.

Provided, further, that this limitation or restriction shall not be applicable to any
distribution of a general bonus to employees of the Company.
To provide for the welfare of employees etc
(s) To provide for the welfare of employees or ex-employees of the Company or its
predecessors in business and the spouse, widow or widower, father (including
stepfather), mother (including stepmother), brother (including stepbrother), sister
(including stepsister), son (including stepson), daughter (including stepdaughter), son’s
widow, daughter’s widower, deceased son’s children, deceased daughter’s children or
the dependents of such employees or ex-employees by building or contributing to the
building of houses or dwellings or by grant of money, pensions, allowances, bonus or
other payments or by building or contributing to the building of houses or dwelling or
by creating and from time to time subscribing or contributing to provident funds and

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 other associations, institutions, funds or trusts and by providing or subscribing or
contributing towards places of instruction and recreation, hospitals and dispensaries,
medical and other attendances and to subscribe or contribute to or otherwise assist
charitable, benevolent, national and/or other institutions or objects.
To subscribe to charitable funds
(t) Subject to the provisions of the Act and these presents to subscribe or guarantee money
for any national, charitable, benevolent, public, general or useful object or for any
exhibition or to any institution, club, society or fund.
To establish reserve funds of various nature
(u) The Board may, before recommending any dividend, set aside out of the profits of the
Company such sums as they may think proper for depreciation or to a Depreciation
Fund or as reserve or to a Reserve Fund or Sinking Fund or any Special Fund to meet
contingencies or to repay preference shares or debentures or for payment of dividends
or for equalizing dividends or for repairing, improving, extending and maintaining any
part of the property of the Company or for such other purposes as the Board may, in
their absolute discretion, think conducive to the interests of the Company; and the
Board may invest the several sums so set aside or so much thereof as required to be
invested upon such investments (subject to the restrictions imposed by the Act) as the
Board may think fit and from time to time deal with and vary such investments and
dispose of and apply and expend all or any part thereof for the benefit of the Company,
in such manner and for such purposes as the Board (subject to such restrictions as
aforesaid), in their absolute discretion, think conducive to the interests of the Company
notwithstanding that the matters to which the Board applies or upon which they expend
the same, or any part thereof may be matters to or upon which the capital monies of the
Company might rightly be applied or expended; and the Board may divide the reserve
or any fund into such special funds and transfer any sum from one fund to another as
the Board may think fit and may employ the assets constituting all or any of the above
funds, including the Depreciation Fund, in the business of the Company or in the
purchase or repayment of preference shares or debentures and that without being bound
to keep the same separate from the other assets and without being bound to pay interest
on the same, with power, however, to the Board, at their discretion, to pay or allow to
the credit of such fund interest at such rate as the Board may think proper.
To appoint officers etc
(v) To appoint and, at their discretion, remove or suspend such committee or committees of
experts, technicians or advisers or such manager(s), officer(s), clerk(s), employee(s) and
agent(s) for permanent, temporary or special services as they may from time to time
think fit and to determine their powers and duties and fix their salaries and emoluments
and require security in such instances and to such amounts as they may think fit and
also without prejudice as aforesaid from time to time to provide for the management
and transaction of the affairs of the Company in any specified locality in India and the
provisions contained in sub-article (y) and (z) of this Articles following shall be without
prejudice to the general powers conferred by this sub-article.
To ensure compliance of local laws
(w) To comply with the requirements of any local law which, in their opinion, it shall, in the
interest of the Company, be necessary or expedient to comply with.

To establish local Boards etc

(x) From time to time and at any time to establish any Local Board for managing any of the
affairs of the Company in any specified locality in India or elsewhere and to appoint
any persons to be members of any Local Boards and to fix their remuneration. And
from time to time and at any time, but subject to the provisions of Section 179 of the
Act and these presents to delegate to any person so appointed any of the powers,
authorities and discretions for the time being vested in the Board and to authorize the
members for the time being of any such Local Board or any of them to fill up any
vacancies therein and to act notwithstanding vacancies and any such appointment or
delegation may be made on such terms and subject to such conditions as the Board may
think fit and the Board may at any time remove any person so appointed and may annul
or vary any such delegation. Any such delegate may be authorised by the Board to sub
delegate all or any of the powers, authorities and discretions, for the time being, vested
in them.
To appoint attorneys

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 (y) At any time and from time to time but subject to the provisions of Section 179 of the
Act and these presents by Power of Attorney to appoint any person or persons to be the
attorney or attorneys of the Company for such purposes and with such powers,
authorities and discretions (not exceeding those vested in or exercisable by the Board
under these presents) and for such period and subject to such conditions as the Board
may from time to time think fit and any such appointment (if the Board thinks fit) may
be made in favour of the members or any of the members of any Local Board
established as aforesaid or in favour of any company or the Members, Board , nominees
or managers of any company or firm or otherwise in favour of any fluctuating body or
any persons whatsoever whether nominated directly or indirectly by the Board and any
such Power of Attorney may contain such powers for the protection or convenience of
persons dealing with such attorneys as the Board may think fit.
Delegation of powers
(z) Subject to the provisions of the Act and these presents, to delegate the powers,
authorities and discretions vested in the Directors to any person, firm, company or
fluctuating body of persons as aforesaid.
Sub delegation of powers
(aa) Any such delegate or attorney as aforesaid may be authorised by the Board to sub
delegate all or any of the powers, authorities and discretions for the time being vested in
him.
To enter into contracts etc
(ab) Subject to the provisions of the Act, to enter into all such negotiations and contracts and
rescind and vary all such contracts and execute and do all such acts, deeds and things in
the name and on behalf of the Company as they may consider expedient for or in
relation to any of the matters aforesaid or otherwise for the purposes of the Company.
To give indemnities and guarantees
(ac) Subject to the provisions of the Act, to give in the name and on behalf of the Company
such indemnities and guarantees as may be necessary.
To vary or repeal by-laws, regulations etc
(ad) From time to time to make, vary and repeal any by-law, regulations and other rules,
guidelines or instructions for regulating the business of the Company, its officials, the
employees and other persons having dealings with the Company.
Appointment of other Whole time Executives
(ae) To appoint one or more whole time executives, who may be designated as Executive
Director(s) without being member(s) of the Board, or any other managerial personnel
by whatever name called, on such terms and conditions and for such purposes as the
Board may decide from time to time
Residuary and ancillary powers
(af) And generally to do, sanction and authorize all such matters and things as may be
necessary to be done, authorised or sanctioned in or about the general business and
affairs of the company or in or about the execution of all or any of the powers
hereinbefore conferred on the directors
Provisions of the Act to be complied with by the Directors/ Board
165 The Board / Directors shall comply with the provisions of. Sections 92, 185, 188, 184,
170 and 189 of the Act.
MINUTES
Minutes of Board / committee meetings
166 The Company shall cause Minutes of all proceedings of every meeting of the Board of
Directors and all Committees of the Board to be duly entered in a book or books for that
purpose maintained in such form and manner as may be permitted in law from time to
time, including but not limited to loose leaf volumes with their pages consecutively
numbered The Minutes shall contain:

(i) a fair and correct summary of the proceedings at the Meeting;

(ii) the names of the Directors present at the meeting of the Board of Directors or of
any Committee of the Board;
(iii) all decisions taken by the Board and Committees of the Board and all
appointments of officers and Committee of Directors;
(iv) all resolutions and proceedings of meetings of the Board and the Committees of
the Board; and
(v) in the case of each resolution passed at a meeting of the Board or Committee of

454
 the Board, the names of the Directors, if any, dissenting from or not concurring in
the Resolution.
Signing of minutes and evidential effect
167 Any Minutes of any meeting of the Board or of any Committee of the Board, shall be
signed by the Chairman of such meeting or by the Chairman of the next succeeding
meeting and such Minutes shall for all purposes whatsoever be prima facie evidence of
the actual passing of the resolutions recorded and the actual and regular transaction or
occurrence of the proceedings so recorded and of the regularity of the meeting at which
the same shall appear to have taken place.
RESTRICTIONS REGARDING INSPECTION
Inspection of books etc
168 The Board shall from time to time determine whether and to what extent and at what
time and places and under what conditions and regulations the accounts and books of
the company or any of them shall be open to the inspection of members other than
directors. No member other than a director shall have any right of inspecting any
account or books or documents of the company except as conferred by law or
authorised by the Board or the company in general meeting.
THE SEAL
Safe custody of the Seal.
169 (a) The Directors shall provide a Common Seal for the purpose of the Company and shall
have power from time to time to destroy the same and substitute a new Seal in lieu
thereof and the Directors shall provide for the safe custody of the Seal.
To be affixed on the authority of a resolution
(b) The Seal of the Company shall not be affixed to any instrument except
by the authority of a resolution of the Board or of a Committee of the Board authorised
by it in that behalf.
Witnessing and signing
(c) A deed or instrument to which the seal is required to be affixed except the share
certificate , shall be sealed in the presence of and signed by at least one director and the
secretary or such other person as the Board may appoint for the purpose
ESTABLISHMENT OF RESERVE FUND
Transfer of profits to statutory Reserve
170 The Company shall create a Reserve Fund and shall, out of the profit of each year as
disclosed in the profit and loss account prepared under Section 29 of the Banking
Regulation Act, 1949 and before any dividend is declared, transfer to the reserve fund
such sum of money, as is prescribed in Section 17 of the Banking Regulation Act, 1949.
Creation of special Reserves
171 In addition to the reserve fund mentioned in the preceding regulation, the Board may,
before recommending any dividend, set aside out of the profits of the company such
sums of money as it thinks fit proper as a reserve which shall at the discretion of the
Board be applicable for any purpose to which the profits of the company may be
properly applied including provision for meeting contingencies or equalizing dividends
and pending such application, may at the discretion of the Board be either employed in
the business of the company or be invested in such investments (other than shares of the
company) as the Board may from time to time think fit.
Carry over of undistributed profits
172 The Board may also carry forward any profits which it may think prudent not to
distribute as dividend without setting aside as a reserve.
DIVIDENDS
Distribution of profits
173 Subject to the provisions of the Act, the Memorandum and these presents, the profits of
the Company, shall be divisible among the Members in proportion to the amount of
capital paid-up on the shares held by them, respectively.
No dividend on calls in advance paid
174 Capital paid up in advance of calls shall not, confer a right to dividend or to participate
in profits.
Dividend in proportion to amount paid up on shares
175 The Company may pay dividends in proportion to the amount paid up or credited as
paid up on each share where a larger amount is paid up or credited as paid up on some
shares than on others as per the provisions of the Acts.
Company in General Meeting may declare dividend

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 176 Subject to the provisions of the said Acts, the Company in General Meeting may
declare a dividend to be paid to the Members according to their respective rights and
interests in the profits and may fix the time for payment.
No larger dividend than recommended by Board
177 No larger dividend shall be declared than is recommended by the Board but the
Company in General Meeting may declare a smaller dividend. Subject to the provisions
of the Act, no dividend shall be payable except out of the profits of the year or any other
undistributed profits. The declaration of the Directors as to the amount of the net profits
of the Company shall be conclusive
Interim dividend
178 Subject to the provisions of the said Acts and these presents, the Board may from time
to time pay to the Members such interim dividends as in their judgment the position of
the Company justifies. Such interim dividend may be declared at any time and shall be
set off against the final dividend for the relevant period.
Retention of dividends
179 Subject to the provisions of the said Acts, the Board may retain the dividends payable in
respect of which any person is, under the Transmission Clause, entitled to become a
Member or which any person under that Clause is entitled to transfer until such person
shall become a Member in respect of such shares or shall duly transfer the same.
Set off of dividend against monies due to company
180 Subject to the provisions of the said Acts, no Member shall be entitled to receive
payment of any interest or dividend in respect of his share or shares whilst any money
may be due or owing from him to the Company in respect of such share or shares or
otherwise howsoever either alone or jointly with any other person or persons and the
Board may deduct from the interest or dividend payable to any Member all sums of
money so due from him to the Company.
Dividend on shares pending registration of transfer
181 (a) Where any instrument of transfer of shares has been delivered to the Company for
registration and the transfer of such shares has not been registered by the Company, it
shall, notwithstanding anything contained in any other provision of the Act:
Right to dividend does not pass pending registration of transfer
(b) Except as provided under sub article (a) above, any transfer of shares shall not pass the
right to any dividend declared thereon, before the registration of the transfer in the
company’s/ Depository’s records is effected
Dividend how remitted
182 Unless otherwise directed, any dividend may be paid by cheque or warrant sent through
the post to the registered address of the Member or person entitled thereto or, in case of
joint-holders, to that one of them first named in the Register in respect of the joint
holding. Every such cheque shall be made payable to the order of the person to whom it
is sent. The Company shall not be liable or responsible for any cheque or warrant lost in
transmission or for any dividend lost by the Member or person entitled thereto by the
forged endorsement of any cheque or warrant or the fraudulent or improper recovery
thereof by any other means.
Unclaimed Dividends
183 (a) Subject to the provisions of Section 205A of the Act, if the Company has declared a
dividend but which has not been paid or claimed within 30 days from the date of
declaration to any shareholder entitled to the payment of the dividend, the Company
shall, within seven days from the date of expiry of the said period of 30 days, transfer
the total amount of dividend which remains unpaid or unclaimed within the said period
of 30 days, to a special Unpaid Dividend account to be opened in that behalf in any
scheduled bank
Transfer of unclaimed dividends to Investor Education and Protection Fund
(b) Any money transferred to the Unpaid Dividend Account of the Company which remains
unpaid or unclaimed for a period of seven years from the date of such transfer, shall be
transferred by the Company to the Fund established under the Act.
Forfeiture of unclaimed dividend
(c) No unclaimed dividend shall be forfeited till the claim thereto becomes barred by law
Dividend and call together
184 Any General Meeting declaring a dividend may make a call on the Members in respect
of monies unpaid on shares for such amount as the meeting fixes but so that the call on
each Member shall not exceed the dividend payable to him and so that the call be made

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 payable at the same time as the dividend and the dividend may, if so arranged between
the Company and the Members, be set off against the call.
Dividend to be paid in cash
185 No dividend shall be payable except in cash. Provided that nothing in this Article shall
be deemed to prohibit the capitalization of profits or reserve of the Company for the
purpose of issuing fully paid-up bonus shares or paying up any amount for the time
being unpaid on any shares held by the Members of the Company.
CAPITALISATION
Capitalization of reserve or Reserve Fund
186 (a) Any General Meeting may resolve that any monies, investments or other assets forming
part of the undivided profits standing to the credit of the reserve or Reserve Fund or any
other fund of the Company or in the hands of the Company and available for dividend
or representing premiums received on the issue of shares and standing to the credit of
the share premium account be capitalized subject to compliance of law:

(i) by the issue and distribution as fully paid-up shares, debentures, debenture stock,
bonds or other obligations of the Company; or
(ii) by crediting shares of the Company which may have been issued and are not fully
paid up, with the whole or any part of the sum remaining unpaid thereon; or
(iii) Partly as specified in (i) above or partly as specified in (ii) above;

subject that a Securities Premium Account and a capital redemption reserve may,
for the purposes of this regulation , only be applied in the paying up of unissued
shares to be issued to members of the company as fully paid bonus shares.

Such issue and distribution under (i) above and such payment to the credit of unpaid
share capital under (ii) above shall be made to, among and in favour of the Members or
any class of them or any of them entitled thereto and in accordance with their respective
rights and interest and in proportion to the amount of capital paid-up on the shares held
by them, respectively, in respect of which such distribution under (i) or payment under
(ii) above shall be made on the footing that such Members become entitled thereto as
capital. The Board shall give effect to any such resolution and apply such portion of the
profits or reserve or Reserve Fund or any other fund on account as aforesaid as may be
required for the purpose of making payment in full for the shares, debentures or
debenture stock, bonds or other obligations of the Company so distributed under (i)
above or, as the case may be for the purpose of paying, in whole or in part, the amount
remaining unpaid on the shares which may have been issued and are not fully paid up
under (ii) above:

Provided that no such distribution or payment shall be made unless recommended by

the Board and, if so recommended, such distribution and payment shall be accepted by
such Members as aforesaid in full satisfaction of their interest in the said capitalized
sum.
Board to give effect to the General Body resolution, and settle difficulties, if any
(b) For the purpose of giving effect to any such resolution, the Board may settle any
difficulty which may arise in regard to the distribution or payment as aforesaid as they
think expedient and, in particular, they may issue fractional certificates and may fix the
value for distribution of any specific assets and may determine that cash payments be
made to any Members on the footing of the value so fixed and may vest any such cash,
shares, debentures, debenture stock, bonds or other obligations in trustees upon such
trusts for the persons entitled thereto as may seem expedient to the Board and generally
may make such arrangements for the acceptance, allotment and sale of such shares,
debentures, debenture stock, bonds or other obligations and fractional certificates or
otherwise as they may think fit. Subject to the provisions of the Act and these presents,
in cases where some of the shares of the Company are fully paid and others are partly
paid, only such capitalization may be effected by the distribution of further shares in
respect of the fully paid shares and by crediting the partly paid shares with the whole or
part of the unpaid liability thereon but so that as between the holders of the fully paid
shares and the partly paid shares the sums so applied in the payment of such further
shares and in the extinguishment or diminution of the liability on the partly paid shares
shall be so applied pro rata in proportion to the amount then already paid or credited as
paid on the existing fully paid and partly paid shares, respectively. When deemed

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 requisite, a proper contract shall be filed in accordance with the Act and the Board may
appoint any person to sign such contract on behalf of the holders of the shares of the
Company which shall have been issued prior to such capitalization and such
appointment shall be effective.
Capitalization of profits or reserves for issue of bonus shares
(c) The Company may capitalise its profits or reserves for the purpose of issuing fully paid
bonus shares in accordance with the provisions of Section 63 of the Act.
ACCOUNTS
Accounts and their maintenance
187 The Company has to duly comply with the provisions of Companies Act with respect to
the maintenance of books of account and other relevant books and papers and financial
statements for every financial year including its branch office or offices
Laying of Accounts and Reports before General Body
188 Once atleast in every calendar year, the Board shall lay before the Company in Annual
General Meeting a Profit and Loss Account for financial year of the Company
immediately preceding the financial year in which such meeting is held and a Balance
Sheet containing a summary of the assets and liabilities of the Company made up as at
the end of the last working day of that financial year or in case where an extension of
time has been granted for holding the meeting up to such extended time and every such
Balance Sheet, shall as required by Section 134 of the Act, be accompanied by a report
(to be attached thereto) of the Directors as to the state and condition of the Company
and as to the amount (if any) which they recommend to be paid out of the profits by
way of dividend and the amount (if any) set aside by them for the Reserve Fund,
general reserve or Reserve Account shown specifically in the Balance Sheet or to be
shown specifically in a subsequent Balance Sheet.
Form and contents of Balance Sheet etc
189 Every Balance Sheet and Profit and Loss Account of the Company shall give a true and
fair view of the state of affairs of the Company or its branch office and shall, subject to
the provisions of Section 129 of the Act and to the extent they are not inconsistent with
the Act, be in the forms set out in the Third Schedule of the Banking Act or as near
thereto as circumstances admit.
Authentication of Balance Sheet , Accounts, Copies to be sent to members etc.
190 The Balance Sheet and the Profit and Loss Account shall be signed by at least four
Directors including the Chairman and the Managing director where there is one, and
two other directors, the Chief Financial Officer and the Company Secretary or such
other person/s authorised by the Board. The Balance Sheet and the Profit and Loss
Account shall be approved by the Board of Directors before they are signed on behalf of
the Board in accordance with provisions of this Article and before they are submitted to
the Auditors for their Report thereon. The Auditors’ Report shall be attached to the
Balance Sheet and the Profit and Loss Account or there shall be inserted at the foot of
the Balance Sheet and the Profit and Loss Account a reference to the Report. A copy of
such Balance Sheet and the Profit and Loss Account so audited together with a copy of
the Auditors’ Report and every other document required by law to be annexed or
attached to the Balance Sheet shall not less than 21 days before the meeting at which the
same are to be laid before the Members of the Company, be subject to the provisions of
Section 136 of the Act, sent to every trustee for the holders of any debenture and to all
persons other than such Members or Trustees, being so entitled.
Copies of Balance sheet and Accounts to be filed with Registrar
191 After the financial statements, including the consolidated financial statement, along
with all the documents which are required to be attached to such financial statements
under the Act have been laid before the Company at a General Meeting, shall be filed
with the Registrar within thirty days of the date of Annual General Meeting.
AUDIT
Accounts to be audited every year
192 Atleast once in every year or such other period as the Board may stipulate, the Accounts
of the Company shall be balanced and audited and the correctness of the Profit and Loss
Account and Balance Sheet ascertained by one or more Auditor or Auditors to be
appointed as required by the said Acts.
Appointment of Auditors
193 The appointment and the removal of Auditors and the person who may be appointed as
Auditors shall be as provided in Sections 139, 140, 141 and 142 of the Act and the

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 relevant provisions of the Banking Regulation Act, 1949. All Appointments, including
the filling of casual vacancy of an auditor shall be made after taking into account the
recommendations of Audit Committee.
Audit of branches
194 The audit of the branch office, if any, of the Company shall be in the manner provided
by Section 143 (8) of the Act.
Remuneration of Auditors
195 The remuneration of the Auditors of the Company shall be fixed by the Company in
General Meeting or by the Board of Directors, if so authorised by the Company in
General Meeting except that the remuneration of any Auditors appointed to fill any
casual vacancy, may be fixed by the Board of Directors.
LEGAL ACTION
Authority in legal processes and proceedings
196 In all legal proceedings in any court of law, legal or quasi-judicial proceedings in any
Consumer Disputes Redressal Forums, Tribunals or other statutory forums, Managing
Director and other officials of the company who hold power of attorney or are
authorised by Board Resolutions to act on behalf of the Company, shall have the powers
severally to represent the company and sign all pleadings and accept all processes, until
revoked or unless otherwise decided by the Board
WINDING UP
Applicability of provisions of the said Acts
197 For winding up of the Company, the provisions contained in the Banking Act will apply
and the provisions of the Act will also apply to the extent to which they are not varied
or inconsistent with the Banking Act.
SECRECY CLAUSE
Members not entitled for secret information
198 (a) No Member shall be entitled to require discovery of or any information respecting any
detail of the Company’s trading or any matter which may be in the nature of a trade
secret, mystery of trade or secret process which may relate to the conduct of the
business of the Company and which, in the opinion of the Board, will be inexpedient in
the interest of the Company to communicate the same.
Director, Manager etc to observe secrecy and if necessary, to give declaration
(b) Every director, manager, secretary, agent, auditor, officer or other employees or
servants of the company and every share holder or other person who gains access to the
books and other papers of the company or to the company’s premises, where goods
pledged to the company are kept, shall, if so required by the Board of Directors, before
entering upon such duties or gaining access to the places aforesaid, sign a declaration
pledging himself to observe strict secrecy regarding all transactions of the company
with its customers and all information obtained in the course of his duties or while in
the premises aforesaid, respecting all transactions of the company and such other
matters as the Managing Director or the Board of Directors may declare expedient to be
kept undisclosed in the interest of the company and shall by a like declaration bind
himself not to use any of the said information, matters and things in any manner
prejudicial to the interest of the company.
INDEMNITY AND RESPONSIBILITY
Directors’ and others’ right to indemnity
199 (a) Subject to the provisions of the Act, every Director of the Company, officer (whether
Managing Director, Manager, Secretary or other officer) or employee or any person
employed by the Company as Auditor shall be entitled to be protected or indemnified
by the Company against and it shall be the duty of the Directors out of the funds of the
Company to pay all costs, losses and expenses (including travelling expenses) which
any such Director, officer, other employee or Auditor may incur or become liable to by
reason of any contract entered into or act or deed done by him as such Director, officer,
other employee or Auditor or in any way in the discharge of his duties.
Indemnity / Protection from liability arising from legal action
(b) Subject as aforesaid every Director, officer, other employee or Auditor of the Company
shall be entitled to be protected or indemnified against any liability incurred by him in
defending any proceedings whether civil or criminal, in which judgment is given in his
favour or in which he is acquitted or discharged in connection with any application
under Section 463 of the Act in which relief is granted to him by the court or the
Tribunal.

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 SECTION IX – OTHER INFORMATION

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts (not being contracts entered into in the ordinary course of business carried on by our Bank
or entered into more than two years before the date of this Draft Red Herring Prospectus) which are or may be
deemed material have been entered or to be entered into by our Bank. These contracts, copies of which will be
attached to the copy of the Red Herring Prospectus, delivered to the Registrar of Companies for registration and also
the documents for inspection referred to hereunder, may be inspected at our Registered Office from 10.00 am to 4.00
pm on Working Days from the Bid Opening Date until the Bid Closing Date.

Material Contracts

1. Issue Agreement dated March 30, 2015, among our Bank and the BRLMs.

2. Agreement dated March 28, 2015, among our Bank and Registrar to the Issue.

3. Escrow Agreement dated [], among our Bank, the BRLMs, the Escrow Collection Banks, the Registrar to the
Issue and the Syndicate Members.

4. Syndicate Agreement dated [], among our Bank, the BRLMs and the Syndicate Members.

5. Underwriting Agreement dated [] among our Bank, the BRLMs and the Syndicate Members.

6. Tri-partite agreement dated April 12, 2010, among NSDL, our Bank and S.K.D.C. Consultants Limited.

7. Tri-partite agreement dated March 20, 2003, among CDSL, our Bank and S.K.D.C. Consultants Limited.

8. Resolution of the Shareholders passed at the AGM held on September 29, 2014.

9. Letter (DBOD no. 1767/08.36.001/2012-13) from the RBI dated July 31, 2012.

10. Letter (DBOD no. 3366/08.36.001/2014-15) from the RBI dated September 4, 2014.

11. Letter (DBOD.3366/08.36.001/2014-15) from the RBI dated September 4, 2014.

12. Resolution of the Board of Directors dated November 13, 2013.

13. Resolution of the Shareholders passed at the AGM held on September 28, 2012.

14. Order no. DBOD.PSBD No.16721/16.05.03/2012-13 dated May 23, 2013 of the RBI appointing Mr. K. Neethi
Ragavan as an additional director.

15. Resolution of the Board of Directors dated September 23, 2013.

16. Order no. DBR.PSBD No.13535/16.05.008/2014-15 dated March 13, 2015 of the RBI appointing Mr. V. G.
Venkatachalapathy as an additional director.

17. Resolution of the Board of Directors dated March 30, 2015.

18. Resolution of the Board of Directors dated September 29, 2014.

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19. Resolution of the Shareholders passed at a meeting held on September 23, 2013.

Material Documents

1. Our Memorandum and Articles of Association, as amended from time to time.

2. Our certification of incorporation dated November 26, 1920 under the Indian Companies Act, 1913 and fresh
certificate of incorporation dated April 14, 1987 under the Companies Act, 1956.

3. Resolution of the Board of Directors dated December 2, 2014 authorising the Issue.

4. Resolution of the Shareholders passed at the EGM held on February 19, 2015 authorising the Issue.

5. Resolution of the Board of Directors dated March 30, 2015, approving this Draft Red Herring Prospectus.

6. Report of the Auditors dated March 30, 2015 on the restated audited financial statements beginning at page F-1.

7. Statement of Tax Benefits from the Auditors dated March 30, 2015.

8. Copies of annual reports of our Bank for Fiscal Years 2010, 2011, 2012, 2013 and 2014.

9. Consent of the Auditors to include their reports on the restated audited financial statements and the statement of
tax benefits, in the form and context in which they appear in this Draft Red Herring Prospectus.

10. Consents of the BRLMs, Syndicate Members, Registrar to the Issue, Escrow Collection Bank(s), Refund
Bank(s), Directors of our Bank, Company Secretary and Compliance Officer, legal counsels, as referred to, in
their respective capacities.

11. In-principle listing approvals dated [●] and [●] received from the NSE and the BSE, respectively.

12. Due diligence certificate dated March 30, 2015 to SEBI from the BRLMs.

Any of the contracts or documents mentioned in this Draft Red Herring Prospectus may be amended or modified at
any time if so required in the interest of our Bank or if required by the other parties, without reference to the
shareholders subject to compliance of the provisions contained in the Companies Act, 2013 and other relevant
statutes.

In accordance with Section 27 of the Companies Act, 2013, in the event any of the material contracts mentioned in
this section are required to be modified or amended, post the filing of the Prospectus with the RoC, reference shall
be made to the shareholders of our Bank for the same.

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 DECLARATION

DECLARATION BY OUR BANK

We hereby declare that all relevant provisions of the Companies Act and the guidelines/regulations issued by the
Government of India or the guidelines/regulations issued by the Securities and Exchange Board of India, established
under Section 3 of the Securities and Exchange Board of India Act, 1992, as the case may be, have been complied
with and no statement made in this Draft Red Herring Prospectus is contrary to the provisions of the Companies Act,
the Securities Contract (Regulation) Act, 1956, the Securities and Exchange Board of India Act, 1992 or rules made
or guidelines or regulations issued thereunder, as the case may be. We further certify that all statements in this Draft
Red Herring Prospectus are true and correct.

SIGNED BY THE DIRECTORS OF OUR BANK

Mr. S.Santhanakrishnan
Mr. Ajay Lal
Mr. T. S. Anantharaman
Mr. Bobby Jos C.
Mr. C. K. Gopinathan
Mr. K. Subrahmanya Sarma
Mr. Sumeer Bhasin
Ms. Radha Unni
Mr. S. Ramakrishnan
Mr. M. Madhavan Nambiar
Mr. K. Neethi Ragavan
Mr. V. G. Venkatachalapathy

SIGNED BY THE CHIEF FINANCIAL OFFICER OF OUR BANK

Mr. P. V. Antony(Chief Financial Officer)

Date: March 30, 2015

Place: Chennai

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