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You can view the entire text of Notes to accounts of the company for the latest year

BSE: 532461ISIN: INE160A01022INDUSTRY: Finance - Banks - Public Sector

BSE   ` 124.35   Open: 123.00   Today's Range 123.00
125.10
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133.00
Year End :2023-03 

During the year ended 31.03.2022 Bank had issued 53,33,33,333 equity shares having Face Value of Rs.2 each for cash to Qualified Eligible Buyers pursuant to Qualified Institutional Placement (QIP), in May 2021, in accordance with the provisions of Securities & Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended, at a premium of ?31.75 per share aggregating f1,800.00 Crore. This has resulted in an increase of Rs.106.67 Crore in the issued and paid up Equity Share Capital and f1,686.38 Crore (Net of share Issue Expenses) in Share Premium Account).

Note: CETI Capital includes Amalgamation Reserve f9268.29 Crore.

RBI vide circular no. DOR.No.CAP.REC.3/21.06.201/2022-23 dated 1st April, 2022 has given discretion to banks to consider Revaluation Reserve, Foreign Currency Translation Reserve and Deferred Tax Asset for purpose of computation of Capital Adequacy as CET-1 capital ratio. The Bank has exercised the option in the above computation.

2 b) Liquidity coverage ratio (LCR)

QUALITATIVE DISCLOSURE ON LIQUIDITY COVERAGE RATIO

The bank has implemented RBI guidelines on Liquidity Coverage Ratio (LCR) from 1st January 2015.

The LCR standard aims to ensure that a bank maintains an adequate level of unencumbered High Quality Liquid Assets (HQLAs) that can be readily converted into cash at little/no loss of value to meet its liquidity needs for a 30 calendar day time horizon under a liquidity stress scenario.

LCR has two components:

i. The value of the stock of High Quality Liquid Assets (HQLA)-The Numerator.

ii. Total Net Cash Outflows: Total expected cash outflows minus Total expected cash inflows, in stress scenario, for the subsequent 30 calendar days - The denominator.

Definition of LCR:

Stock of high quality liquid assets (HQLAs) ^ 100% (w.e.f Total net cash outflows over the next 30 ca lendardays "" 01.04.2021)

For Q4 FY’2022-23, the daily average LCR was 162.29% (based on simple average of daily observations) at consolidated level, as against the regulatory requirement of 100%.

The main drivers of LCR of the bank are High Quality Liquid Assets (HQLAs) to meet liquidity needs of the bank at all times and basic funding from retail and small business customers. The retail and small business customer’s contribute about 67.18% of total deposit portfolio of the bank, which attracts low run-off factor of 5/10% as on 31.03.2023.

Composition of High Quality Liquid Assets (HQLA)

HQLAs comprises of Level 1 and Level 2 assets. Level 2 assets are further divided into Level 2A and Level 2B assets, keeping in view their marketability and price volatility.

Level-lassets are those assets which are highly liquid. For quarter ended March 31, 2023, the Level-1 asset of the bank includes Cash in Hand, Excess CRR, Government Securities in excess of minimum SLR, Marketable securities issued or guaranteed by foreign sovereign, MSF and FALLCR totalling to Rs. 286489.39 cr (based on simple average of daily observations).

Concentration of Funding Sources

This metric includes those sources of funding, whose withdrawal could trigger liquidity risks. It aims to address the funding concentration of bank by monitoring its funding requirement from each significant counterparty and each significant product/instrument. As per RBI guidelines, a "significant counterparty/lnstrument/product" is defined as a single counterparty/lnstrument/product or group of connected or affiliated counter-parties accounting in aggregate for more than 1% of the bank's total liabilities.

The bank has no significant counterparty (deposits/borrowings) as at 31.03.2023. Top 20 depositors of the bank constitute 4.66% of bank’s total Deposit as on Mar 31, 2023. The significant product/instrument include Saving Fund, Current deposit and Core Term Deposit the funding from which are widely spread and cannot create concentration risk for the bank.

Derivative exposure

The bank has low exposure in derivatives having negligible

Currency Mismatch

As per RBI guidelines, a currency is considered as “significant” if the aggregate liabilities denominated in that currency amount to 5 per cent or more of the bank’s total liabilities. In our case, only USD (18.11 % of bank’s total liabilities) falls in this criteria whose impact on total outflows in LCR horizon can be managed easily as the impact is not large considering the size of balance sheet of the bank.

Degree of centralization of liquidity management and interaction between group’s units

The group entities are managing liquidity on their own. However, the bank has put in place a group-wide contingency funding plan to take care of liquidity requirement of the group as a whole in the stress period.

QUALITATIVE DISCLOSURE ON NET STABLE FUNDING RATIO

The Net Stable Funding Ratio (NSFR) and Liquidity Coverage Ratio (LCR) are significant components of the Basel III reforms. The LCR guidelines which promote short term resilience of a bank’s liquidity profile have been issued vide circular DBOD.BP.BC. No.120/21.04.098/2013-14 dated June 9,2014. The NSFR guidelines on the other hand ensure reduction in funding risk over a longer time horizon by requiring banks to fund their activities with sufficiently stable sources of funding in order to mitigate the risk of future funding stress.

In the Indian context, the guidelines for NSFR were effective from October 1, 2021. The NSFR is defined as the amount of available stable funding relative to the amount of required stable funding. "Available stable funding” (ASF) is defined as the portion of capital and liabilities expected to be reliable over the time horizon considered by the NSFR, which extends to one year. The amount of stable funding required ("Required stable funding") (RSF) of a specific institution is a function of the liquidity characteristics and residual maturities of the various assets held by that institution as well as those of its off-balance sheet (OBS) exposures. The run-off factors for the stressed scenarios are prescribed by the RBI, for various categories of liabilities (viz., deposits, unsecured and secured wholesale borrowings), undrawn commitments, derivative-related exposures, and offset with inflows emanating from assets maturing within the same time period. The minimum NSFR requirement set out in the RBI guideline for the standalone Bank and for Group effective October 1,2021 is 100%.

The PNB on a consolidated basis at 31st March, 2023 maintained Available Stable Funding (ASF) of f 1256951 Crore against the RSF requirement of ? 842686 crore. The NSFR for the quarter ended March 31,2023 was at 149.16%.

The Available Stable Funding (ASF) is primarily driven by the total regulatory capital as per Basle III Capital Adequacy guidelines stipulated by RBI and deposits from retail customers, small business customers and non-financial corporate customers. Under the Required Stable Funding (RSF), the primary drivers are unencumbered performing loans with residual maturities of one year or more.

3. c) Sale and transfers to/from HTM category:

The total value of sales and transfers of securities to / from HTM category after netting permitted exclusions in terms of RBI Master Circular No. DOR.MRG.42/21.04.141/ 2021-22 dated 25.08.2021 during 1st April 2022 to 31st March 2023 has not exceeded 5% of the book value of investments held in HTM category as on 31.03.2022.

As such no disclosure is to be made in terms of extant RBI guidelines.

(Previous year: The total value of sales and transfers of securities to / from HTM category after netting permitted exclusions in terms of RBI Master Circular No. DOR. MRG.42/21.04.141/ 2021-22 dated 25.08.2021 during 1st April 2021 to 31st March 2022 has not exceeded 5% of the book value of investments held in HTM category as on 31.03.2021.

4. e) Divergence in Asset Classification and Provisioning

Disclosure on divergence in Asset classification and provisioning for NPAs is not required w.r.t. RBI’s annual supervisory process for the year ended March 31,2022 based on conditions mentioned in RBI Master Direction no. RBI/ DOR/2021-22/83 DOR.ACC.REC.No.45/21.04.018/2021-22 dated August 30, 2021 (Updated as on February 20, 2023).

(Previous year: As per RBI Circular No.DBR.BP.BC No.32/21.04.018/2018-19 dated April 1, 2019, in case the additional provisioning for NPA assessed by RBI exceeds 10% of the reported profit before provisions and contingencies for the reference period and /or additional gross NPAs identified by RBI exceed 15% of the published incremental Gross NPAs for the reference period, then the banks are required to disclose divergence from prudential norms on income recognition, assets classification and provisioning.

Divergences in terms of above circular, are within threshold limits as specified above, hence no disclosure is required with respect to RBI’s annual supervisory process for FY 2021.

4. f) Disclosure of transfer of loan exposures: Total amount of loan not in default / stressed loans transferred and acquired to / from other entities:

In accordance with RBI circular no. DOR.STR. REC.51/21.04.048/2021-22 dated September 24, 2021, the details of loans transferred/acquired during the FY ended March 31,2023 are given below:

Total Net Funded Exposure as on 31.03.2023 is f52,827.59 Crores. Total assets of the Bank as on 31.12.2022 were f 14,01,797 Crores, 1% of total asset is f14,017.97 Crore. Bank exceeded the exposure to USA beyond f14,017.97 Crores i.e. 1% of Total Assets of the Bank as on 31.12.2022. Hence, provision of f 11.82 Crores is required with respect to country risk exposure as on 31.03.2023:

(Previous year: Total Net Funded Exposure as on 31.03.2022 was ?49214.90 Crores. Total assets of the Bank as on 31.12.2021 were f1304849 Crores, 1% of total asset f13048.49 Crore. Bank exceeded the exposure to UAE beyond f13048.49 Crores i.e. 1% of Total Assets of the Bank as on 31.12.2021. Hence, provision of ?28.94 Crores is required with respect to country risk exposure as on 31.03.2022.

The Bank has framed a policy to manage Currency Induced Credit Risk and has been incorporated in Bank’s Credit Management & Risk Policy 2022-23 as follows:

In terms of RBI guidelines, the Bank has framed a policy to manage currency induced credit risk and has incorporated the same in bank’s current Credit Management & Risk Policy as follows:

“In terms of RBI guidelines, Bank monitors the currency wise Unhedged Foreign Currency Exposure in the books of borrowers at quarter ends along-with the Annualized Earnings before Interest & Depreciation (EBID). The incremental provision (ranging from 0 to 80 bps on total credit exposure, over and above the standard asset provisioning) and capital requirement will depend on likely loss (due to foreign currency fluctuation), that borrowers may face due to their un-hedged forex exposure in their books. Bank maintains separate charge and provisioning requirement on account of such exposures which may impact the cost to the borrowers. Appropriate disclosures in the financial statements of the bank shall also be made.”

The Bank has estimated the liability for Unhedged Foreign Currency Exposure in terms of RBI Circular DBOD.NO.BP. BC.82/21.06.200/2013-14 dated January 15, 2014 and is holding a provision of f 132.35 Crores as on 31.03.2023 (previous year ? 85.48 Crores).

$All these swap deals are with Banks and FI.

@All these swaps deals are Trading swap and the fair value is its mark to market value

The above Trades are Interest rate Swap Deal done with Interbank for f745.00 Crores (previous year f385.00Crores) and with Financial Institution f NIL (previous year f NIL).

Credit Risk (Credit Exposure) for Current Year is f4.08 Crore (previous year ?2.70 Crore).

There are total 40 deals out of which 0 deals are Back to Back Deals, 2 Deals where payment is made at Fixed Contract rate and received at Floating rate and in remaining 38 deals, payment is made at Floating Rate and received at Fixed Contract rate”.

7. c) Disclosures on risk exposure in derivatives 7.c). i). Qualitative disclosures

The Bank uses derivatives products for hedging its own balance sheet items as well as for trading purposes. The risk management of derivative operation is headed by a senior executive, who reports to top management, independent of the line functions. Trading positions are marked to market on daily basis.

The derivative policy is framed by Integrated Risk Management Division, which includes measurement of credit risk and market risk.

The hedge transactions are undertaken for balance sheet management. Proper system for reporting and monitoring of risks are in place. Policy for hedging and processes for monitoring the same is in place.

Accounting policy for recording hedge and non-hedge transactions are in place, which includes recognition of income, premiums and discounts.

Valuation of outstanding contracts, provisioning, collateral and credit risk mitigation are being done.

7. d) Credit default swaps

Since the Bank is not using any proprietary pricing model for pricing Credit default swaps contracts, and it is over the counter contract (OTC), the price is determined by the market dynamics.

As such no disclosure is to be made in terms of extant RBI guidelines for Current & Previous year.

14. f) Implementation of IFRS converged Indian Accounting Standards (Ind AS)

The strategy for Ind AS implementation, including the progress made in this regard:

IND AS roadmap for scheduled commercial banks (excluding regional rural banks), insurers/insurance companies and nonbanking financial companies (NBFCs) was issued by Union

Ministry of Corporate Affairs (MCA) through press release dated 18 January 2016. IND AS was applicable to the Bank in accordance with the MCA press release from financial year 2018-19 which was deferred to financial year 2019-20 vide RBI’s Press Release (2017-18/2642) dated 5 April 2018. RBI has further deferred implementation of IND AS till further notice vide its Circular no DBR.BP.BC.No. 29/21.07.001/2018-19 dated 22.03.2019. The Bank accordingly, has appointed a Consultant to assist in implementation of the Ind AS. The Audit Committee of the Board is being apprised of the progress made from time to time. The Bank has a well-planned strategy for Ind AS implementation and has made substantial progress in this regard. Further, Bank is submitting the Proforma Ind AS Financial Statements to the RBI as per prescribed periodicity.

15. Other Disclosures with respect to certain Accounting Standards15.a) Accounting Standard 5 - Net Profit or Loss for the period, Prior Period Items and Change in Accounting Policy:

During the Current and Previous year there were no material prior period income/expenditure items requiring disclosure under Accounting Standard 5.

The financial results for the year ended March 31,2023 have been prepared following the same significant Accounting Policies and practices as those followed in the annual financial statements for the year ended March 31,2022.

(Previous year: The financial results for the year ended March 31, 2022 have been prepared following the same Accounting Policies and practices as those followed in the annual financial statements for the year ended March 31, 2021, except recognition of commission on Letter of Credit and Bank Guarantee. With effect from April 01, 2021, the commission on Letter of Credit and Bank Guarantee is recognised as revenue to the extent accrued for the period as against recognition done on receipt basis hitherto. This change in accounting policy has resulted in decrease in profit before tax by f 11.67 Crore for quarter ended March 31,2022 and by f207.64 Crore for year ended March 31,2022.

15. b) Accounting Standard 9 - Revenue Recognition

Certain items of income are recognized on realization basis as per Accounting Policy No. 3.5. However, the said income is not considered to be material. (Previous year: Certain items of

income are recognized on realization basis as per Accounting Policy No. 3.5. However, the said income is not considered to be material).

15. c) Accounting Standard 10 - Properties, Plant and Equipment.

Break-up of total depreciation for the FY ended March 31, 2023 for each class of assets:

15.e) i) Defined Contribution Plans: -

The Bank has Defined Contribution Plan applicable to all categories of employees joining the Bank on or after 01.04.2010. The scheme is managed by NPS trust under the aegis of the Pension Fund Regulatory and Development Authority. National Securities Depository Limited (Protean eGov Technologies Limited) has been appointed as the Central Record Keeping Agency for the NPS.

The detail of the contribution is as under-During the Financial Year 2022-2023= Rs 1220.32 Crore (Contribution Includes both Bank Employee contribution) During the Financial Year 2021-2022= Rs 974.43 Crore (Contribution Includes both Bank Employee contribution)

15.e)ii) Pursuant to the revision in family pension payable to the employees of the Bank, covered under 11th Bi- Partite Settlement and joint note dated November 11, 2020, the Bank had estimated additional liability of Rs.3093.95 Crore, of which a sum of Rs.1573.79 Crore was amortized during the financial year 2021-22, in terms of RBI Circular no. RBI/2021-22/105 DOR.ACC.REC.57/21.04.018/2021-22 dated October 04, 2021 and unamortized part of Rs.1520.16 Crore has been fully charged to the Profit & Loss Account during the FY 202223. There is no unamortized expenditure in the Balance Sheet on account of additional family pension.

15.f) Accounting Standard 17 - Segment Reporting

Segment Identification

I. Primary (Business Segment):

The following are the primary segments of the Bank:-

i) Treasury: The Treasury Segment includes the entire investment portfolio and trading in foreign exchange contracts and derivative contracts. The revenue of the treasury segment primarily consists of fees and gains or losses from trading operations and interest income on the investment portfolio.

ii) Corporate / Wholesale Banking: As per the

RBI guidelines RBI/2020-21/53, DOR.No.BP. BC.23/21.06.201/2020-21, dated 12th October 2020, the Corporate / Wholesale Banking segment comprises the lending activities of borrowers having exposure of f 7.50Crores and above.

iii) Retail Banking: The Retail Banking Segment comprises of borrower accounts having exposure of less than f7.50Crores.

iv) Other Banking Operations: Segments not classified under (i) to (iii) above are classified under this primary segment.

II Secondary (Geographical Segment):

i) Domestic Operations- Branches/Offices having

operations in India

ii) Foreign Operations - Branches/Offices having operations outside India and offshore banking units having operations in India.

III. Basis of allocation

The interest income is allocated on the basis of actual interest received from different segments

Expenses not directly attributable are allocated on the basis of Interest income earned by the wholesale banking / retail banking segment/other banking segment

Capital employed for each segment is calculated based on the assets and liabilities of that particular segment

The Bank has certain common assets and liabilities, which cannot be attributed to any segment, and the same are treated as unallocated.

1. Segment Liabilities are distributed in the ratio of their respective Segment Assets.

2. As per RBI Circular RBI/2022-23/19 DOR.AUT.REC. 12/22.01.001/2022-23 dated April 07, 2022, for the purpose of disclosure under Accounting Standard 17, Segment Reporting, Digital Banking Segment has been identified as sub-segment under Retail Banking by Reserve Bank of India (RBI). During the year ended March 31,2023, 8 (eight) Digital Banking Units (DBUs) of the Bank have commenced operations and the segment information disclosed as Digital Banking under Retail Banking Operations is related to the said DBUs.

3. Figures of the previous period have been re-grouped/re-classified wherever necessary.

15. g) Accounting Standard 18 - Disclosure of Related Parties as per Accounting Standard - 18 issued by ICAI:

The deferred tax assets f 1751.69 Crore for the year ended 31.03.2023 (FY 2022-23) is debited to Profit & Loss Account (Previous year: Debited ? 1541.35 Crores).

ii) Current Tax: During the financial year ended 31.03.2023 the bank has debited f 29.38 Crore to Profit & Loss Account (Previous Year: Debited f Nil) on account of current tax after reversal of provision of earlier years of ? 515.94 Crore. Accordingly, the total tax expenses on account of current tax & deferred tax assets charged to Profit & Loss account amounts to f 1781.07 Crore.

iii) Tax Paid in advance/Tax deducted at source appearing under “Other Assets” includes disputed amount adjusted by the department/paid by the Bank in respect of tax demands for various assessment years.

iv) No provision is considered necessary in respect of disputed Income Tax demands of f8475.38 Crore (Previous year f 11427.55 Crore) as in the bank’s view, duly supported by expert opinion and/or decision in bank’s own appeals on same issues, additions / disallowances made are not sustainable.

v) The Bank has evaluated the options available under section 115BAA of Income Tax Act, 1961 and opted to continue to recognise the taxes on income for the financial year 2022-23 as per the earlier provisions of Income Tax Act, 1961.

vi) The current tax expenses and deferred tax expenses are determined in accordance with the provisions of the Income Tax Act, 1961 and as per the Accounting Standard 22- “Accounting for Taxes on Income” issued by the Institute of Chartered Accountants of India respectively. The current Tax in India has been calculated in accordance with the provisions of Income Tax Act 1961 after taking appropriate relief for taxes paid on foreign jurisdiction.

15. k) Accounting Standard 23 - Accounting for Investments in Associates in Consolidated Financial Statements

Since Investments of the bank in its Associates are participative in nature and the Bank having the power to exercise significant influence on their activities, such Investments are recognized in the Consolidated Financial Statements of the Bank.

(Previous year: Since Investments of the bank in its Associates are participative in nature and the Bank having the

power to exercise significant influence on their activities, such Investments are recognized in the Consolidated Financial Statements of the Bank).

15. l) Accounting Standard 24 - Discontinuing operations

During the period from 01.04.2022 to 31.03.2023, the bank has not discontinued operations of any of its branches, which resulted in shedding of liability and realization of assets and no decision has been finalized to discontinue an operation in its entirety which have the above effect.

(Previous year: During the period from 01.04.2021 to 31.03.2022, the bank has not discontinued operations of any of its branches, which resulted in shedding of liability and realization of assets and no decision has been finalized to discontinue an operation in its entirety which have the above effect).

15. n) Accounting Standard 28 - Impairment of assets

A substantial portion of the bank’s assets comprises ‘financial assets’ to which Accounting Standard 28 ‘Impairment of Assets’ is Not Applicable. In the opinion of the bank, there is no impairment of its assets (to which the standard applies) to any material extent as at 31.03.2023 requiring recognition in terms of the said standard.

(Previous year: A substantial portion of the bank’s assets

comprises ‘financial assets’ to which Accounting Standard 28 ‘Impairment of Assets’ is Not Applicable. In the opinion of the bank, there is no impairment of its assets (to which the standard applies) to any material extent as at 31.03.2022 requiring recognition in terms of the said standard).

ii) Refer Schedule-12 on contingent liabilities

Such liabilities at S.No.(I), (II), (III), (IV), (V) & (VI) are dependent upon the outcome of Court / arbitration / out of court settlement, disposal of appeals, the amount being called up, terms of contractual obligations, devolvement and raising of demand by concerned parties, respectively.

Other Disclosures:

16. Bank’s Disclosure in respect of Credit Exposures where the same had exceeded the Prudential Exposure limits as per Large Exposure (LE) framework prescribed by RBI for Individual/Group Borrowers for the Financial year ended 31.03.2023:

Details of accounts where Bank has exceeded prudential exposure ceilings as per Large Exposure (LE) framework in respect of any Individual and Group Accounts based on

31.03.2023 are as below:-

RBI Circular dated 03.06.2019 has given leverage of 5% over and above the ceiling of 20% of single counterparty under the Bank’s Board Power. Board in its meeting dated 28.03.2017 has approved that bank may in exceptional circumstances consider enhancement of the exposure ceiling for single counterparty classified as Large Exposure upto 5% over and above ceiling of 20%.

$The same was approved by the Board in its meeting dated 04.06.2022

* The same was approved by the Board in its meeting dated 04.06.2021

All the exposure (other than exempted exposure) of Individual and Group Accounts (except as mentioned above) for the financial year ended 31.03.2023 are within the prescribed regulatory limits, as per LE Framework.

(Previous year- All the exposure (other than exempted exposure) of Individual and Group Accounts (except as mentioned above) for the financial year ended 31.03.2022 are within the prescribed regulatory limits, as per LE Framework).

17. Disclosure: Letter of Comfort (LoC) -

“The Bank has issued a Letter of Comfort to Prudential Regulation Authority (PRA), the regulator in United Kingdom, committing that the bank shall provide financial support to its subsidiary, Punjab National Bank (International) Ltd., UK so that it meets its financial commitments as and when they fall due”.

The said letter of Comfort has been renewed on 15.03.2022 after seeking approval of our Board in favor of PRA w.r.t. our subsidiary PNBIL wherein we have reiterated our commitment. The renewal was done as per instruction of PRA and RBI. Further Annual assessment of LOC was also done vide note dated 20.02.2023 placed in Board meeting dated 28.02.2023.

Apart from the above, the Bank has not issued any Letter of Comfort to Group Entities (Excl. RRBs) and therefore, there are no cumulative financial obligations under Letter of Comfort.

18. Disclosure: Letter of Undertaking-

The Bank has provided a Letter of Undertaking for PNB IBU Gift City Branch under Regulation 3(3) of International Financial Service Centre Authority(IFSCA) that:

“Bank will provide support and assistance (including liquidity, whenever needed) and as may be appropriate to enable the banking unit to meet its obligations in the course of its obligation”.

Apart from the above the Bank has not issued any Letter of Comfort for overseas branches and there are no cumulative financial obligations under Letter of Comfort.

19. Reward Points of Credit Card -

PNB Global Credit Card holders are rewarded as and when they make purchases through usage of Credit Card. Reward Points are generated at the time of usage of Credit Card by Cardholder at merchant Establishment. Card holder can redeem the accumulated reward points. The amount payable on account of reward points is charged to Profit and Loss account and credited to Sundry Provision Account on daily basis.

*The provision held against Rewards points in respect of Credit Cards has been worked out at f0.50 for 1 point. As per latest actuary report on Trend Analysis of credit card rewards points redemption provision has been made @25% of accumulated Reward points on estimated basis as in the previous year.

22. As per RBI guidelines, the Bank worked out the amount of Inter Branch Credit entries outstanding for more than 5 years to create a Blocked Account. Accordingly, a sum of fO.OO Crores (previous year fO.OO Crores ) [net of adjustments since carried out has been included under “Other Liabilities-others” in Schedule-5].

23. Premises includes 10 properties amounting to ?3.72Crore (cost) & depreciation amount to Rs. 2.27 Crore are awaiting registration of title deeds.

Previous year: Premises includes properties amounting to f3.72Crore (cost) & depreciation amount to Rs. 2.20 Crore are awaiting registration of title deeds.

24. Premises includes Capital work in progress of f42.37 Crore for the year ended 31.03.2023 (in the previous Financial Year 2021-22, f127.08 Crore).

25. Guidelines given in Micro, Small and Medium Enterprises Development Act 2006 have been complied with for purchases made during the twelve months ended March 2023 (FY 2022-23) and payments have been made to the Vendors in time as per Act. Since there had been no delay in payment, no penal interest applicable during year ended March, 2023 (FY 2022-23)

26. Depreciation on Revalued Portion of Premises for the current financial year ended March, 2023 is f 166.92 Crores (Previous year ended March, 2022 ?144.61

Crores).

27. During the Financial Year ended 31.03.2023 the Bank has Revalued Immovable Properties (forming part of Schedule -10) during the quarter ended 30.06.2022, based on the reports obtained from external independent valuers. As at 31.03.2023 the revaluation surplus (net) amounting to Rs. 1737.65 crore is credited to the revaluation reserves. (In the Previous financial year 2021-22 ended March, 2022 the Bank has not Revalued Immovable Properties.)

28. In compliance of RBI letter no. BPC.7201/21.04.132/2017-18 dated 08.02.2018, Bank has made a provision of ?93.58 Crore (Previous year ?98.95 Crore) being 5 % of the existing outstanding of ?1871.68 Crore (Previous year ^1979.11 Crore) as on 31.03.2023 in respect of Advance to Government of Punjab Long term Loan (LTL).

29. In terms of RBI Letter no. DBR. No.BP. 15199/21.04.048/2016-17 dated June 23, 2017 (RBI List-1) and Letter no. DBR.BP1908/21.04.048/2017-18 dated August 28, 2017 (RBI List-2) for the accounts admitted under the provisions of Insolvency & Bankruptcy Code (IBC), the Bank is holding total provision of ?9297.46 Crore (Aggregate provision of RBI List 1 and List 2 accounts) as on March 31, 2023 (100.00% of Gross NPA advances). (Previous Year ?8,384.09 Crore (Aggregate provision of RBI List 1 and List 2 accounts), 99.78% of Gross NPA advances).

30. The Board of Directors has recommended a dividend of Re.0.65 per equity share (32.50%) for the year ended March 31,2023 subject to requisite approvals.

31. Pursuant to cessation of the operations of the branch at Hong Kong, disposal of its major assets and liabilities, the seed capital and accumulated profits have been repatriated. The impact of closure of operations in this branch on the business of the Bank is not significant.

32. In terms of RBI Circular no. DOR.ACC.REC. No.91/21.04.018/2022-23 dated 13.12.2022, the disclosure relating to item under the subhead 'Miscellaneous Income' under the head 'Schedule 14 -Other Income' exceeding one percent of total income, is

a) There is no item under ‘Other expenditure’ in schedule 16: Operating Expenses that exceeds 1% of total income.

b) There is no item under ‘Others (including provisions)’ in schedule 5: Other Liabilities and Provisions that exceeds 1% of total assets.

c) There is no item under ‘Others’ in schedule 11: Other Assets that exceeds 1% of total assets.

33. I. Figures of the previous periods have been regrouped / rearranged / reclassified wherever necessary to conform to current period’s classification.

II. Figures in the bracket wherever given relates to previous year.