To the Members,

The Board of Directors is pleased to place before you, the 98 th Annual Report on the business and operations of the South Indian Bank Ltd. ("the Bank") along with the audited accounts for the Financial Year (FY) ended March 31, 2026.

PERFORMANCE OF THE BANK

The performance highlights of the Bank for the Financial Year ended March 31, 2026, are as follows:

Rs in crore

BUSINESS ACHIEVEMENTS

The Bank has achieved a total Business of Rs2,23,620.37 crore, consisting of Deposits of Rs1,23,346.32 crore and Gross Advances of Rs1,00,274.05 crore as on March 31, 2026.

DEPOSITS

The total Deposits of the Bank as on March 31, 2026, were Rs1,23,346.32 crore as against Rs1,07,525.60 crore as on March 31, 2025, registering a growth of 14.71%. The break-up of Deposits as on March 31, 2026, is as under:

The Bank during the year has focused on Retail Advances and CASA.

The CASA has grown from Rs33,729.72 crore as on March 31, 2025 to Rs39,620.92 crore as on March 31, 2026, with a growth of 17.47%. The Savings Bank Deposits grew by 17.24% on a year-on-year (y-o-y) basis. While opening new banking relationships, the Bank has accorded priority to meaningful financial inclusion during the period under reporting.

ADVANCES

The Advance portfolio of the Bank grew by 14.50% on a y-o-y basis to reach Rs1,00,274.05 crore as on March 31, 2026. The focused strategies implemented by the Bank have facilitated rapid growth in advances.

The Bank has registered robust recovery and upgradation of NPAs during the Financial Year 202526 and GNPA stood at Rs1,430.50 crore as at March 31, 2026. The Gross NPA of Bank as on March 31, 2026, as a percentage to gross advance is 1.43% and Net NPA stood at 0.29%.

Ensuring the Bank's vision on asset quality, the underwriting standards are revisited & reviewed from time to time. The GNPA and Net NPA percentage of the new Loan book stood at 0.38% and 0.09% respectively.

During the Financial Year, the Bank could register growth, with focus on building quality assets across all verticals like SME, Gold Loan, Housing loan, Auto loan, etc.

The Bank has adopted a forward-looking approach and envisaged more co-lending arrangements to enhance priority sector lending. All the priority sector advance

targets stand achieved and the Bank was also able to generate additional revenue of Rs85.53 crore during the year, through sale of Priority Sector Lending Certificates (PSLCs).

Priority sector target & achievement as on March 31, 2026 are as follows:

Break-up of exposure under Priority Sector as on March 31, 2026 is furnished below:

The high-quality portfolio growth was channelized by the Relationship Management structure at numerous locations/touch points which helped the Bank in tapping various Retail, SME and cross-selling opportunities. Decentralisation of credit processing centres resulted in speedy disposal of credit facilities.

The Business Process Group (BPG) has been spearheading the Bank's Strategic Digital Transformation by executing a robust Business Process Re-engineering (BPR) exercise coupled with innovative improvements that optimizes core workflows and eliminates operational friction. The Group has significantly contributed to strengthening the digital ecosystem of the Bank by implementing a host of strategic initiatives focused on automation, Straight-Through Processing (STP), AI-driven solutions, and enhanced customer and internal user experience.

Key developments included roll out of 11 flagship process/product flows, AI-enabled document generation, digital verification, and process automation across RAM (Retail including Gold, Agri and MSME), Trade Finance segments, besides transaction based

and simplified auto renewal flows of existing loans. Looking ahead to FY 2026-27, the group is expanding its pipeline by developing advanced initiatives such as ULI & Account Aggregator integration, Unified Technical Valuation Platform, AI enabled solution for Non - Individual current account onboarding & CAM generation for corporate credit files and in-house Loan Origination Systems to build a scalable, efficient, and technology-driven platform. These initiatives are expected to enhance operational efficiency, improve turnaround times, strengthen risk management, and support sustainable business growth.

FINANCIAL PERFORMANCE

Profit

The Net Operating Income (Net Interest Income and Other Income) of the Bank increased by Rs147.78 crore (2.79%) from Rs5,299.07 crore in FY 2024-25 to Rs5,446.85 crore in FY 2025-26. The Non-Interest Income increased by Rs196.06 crore (10.81%) during the year, which was mainly on account of amount recovered from written off accounts during the FY 2024-25. The Operating Profit for the year under review was Rs2,373.37 crore (before taxes and provisions) as against Rs2,270.08 crore (before taxes and provisions) for FY 2024-25. The Net Profit for the year was Rs1,455.14 crore as compared to a net profit of Rs1,302.88 crore during the previous year and the profit available for appropriation are as per details given below:

Dividend

The Board of Directors has recommended a dividend of 45%, i.e., Rs0.45 per Equity share of face value of Rs1/- each per share for the financial year ended March 31, 2026, as against dividend at the rate of 40%, i.e., Rs0.40 per Equity share of face value of Rs1/- each per share paid during the previous Financial Year.

CAPITAL & RESERVES

The Capital plus Reserves of the Bank has moved up from Rs10,099.92 crore, as on March 31, 2025, to Rs11,403.50 crore as on March 31, 2026, mainly on account of plough back of profits, during the current financial year. Apart from the disclosed transfers, no other amounts are proposed to be carried to any reserves.

THE CAPITAL TO RISK WEIGHTED ASSETS RATIO (CRAR)- BASEL III

The Capital to Risk Weighted Assets Ratio (CRAR) of the Bank according to Basel III guidelines is 19.66 as on March 31, 2026, as against the statutory requirement of 11.50 (including Capital Conservation Buffer). Tier I CRAR constitutes 18.76 while Tier II CRAR works out to 0.90. The Bank follows Standardized Approach, Standardized Duration Approach and Basic Indicator Approach for measurement of capital charges in respect of credit risk, market risk and operational risk respectively.

LISTING AGREEMENT WITH STOCK EXCHANGES

The Bank's shares continue to be listed on BSE Ltd. and The National Stock Exchange of India Ltd. The Bank confirms that it has paid the listing fees to all the Stock Exchanges for the financial year 2026-27. The shares of the Bank are actively traded on NSE and BSE and have not been suspended from trading.

BANKING NETWORK

The Bank has its network across India with 953 banking outlets (948 Branches, 3 Satellite branches and 2 Ultra small Branches (USB)) and 1,147 ATMs &126 CRMs as on March 31, 2026. Bank has opened a new Regional Office at Vijayawada. The Bank has also opened 8 new ATMs and 2 CRMs across the country and closed 16

ATMs and 1 CRM. The branch network covers 26 States and 4 Union Territories.

INVESTMENT

Global economic activity remained resilient yet subdued during FY26, amid heightened geopolitical tensions, evolving trade dynamics, and persistent macroeconomic uncertainties. The global outlook became increasingly fragile as Governments recalibrated fiscal, trade, and strategic priorities in response to renewed supply-side disruptions and elevated commodity prices. In its April 2026 World Economic Outlook (WEO), the International Monetary Fund (IMF) projected global growth at 3.1% for 2026 and 3.2% for 2027, reflecting a moderation in growth momentum amid continued geopolitical and inflationary pressures. While inflationary trends eased across several advanced and emerging economies, risks from energy prices, supply-chain disruptions, and currency volatility continued to pose challenges for policymakers. Divergence in monetary policy trajectories across major economies persisted, with central banks adopting a cautious and data-driven approach towards further monetary easing.

According to the latest estimates released by the National Statistical Office (NSO), India's real GDP growth for FY26 was estimated at around 7.6%, reflecting the continued resilience of the domestic economy despite global uncertainties. Growth was supported by strong private consumption, sustained Government capital expenditure, improving investment activity, and robust performance across the services and manufacturing sectors. On the supply side, real Gross Value Added (GVA) was estimated to grow by approximately 7.3% during FY26, led primarily by the services sector along with steady contributions from manufacturing and agriculture. India's headline CPI inflation averaged around 1.7% in FY 2025-26, the lowest annual rate in over half a decade, reflecting a prolonged disinflationary phase in the domestic economy. By March 2026, inflation had settled near 3.4%, indicating a further acceleration from the low levels recorded in the previous year, underpinned by persistent foodprice inflation, urban and rural inflation. Looking ahead, the disinflationary trend is expected to broadly wane, with official and policy related commentary indicating that headline CPI inflation is likely to hover around the lower-single-digit band, underscoring a well-anchored and structurally moderating inflation environment in India through FY 2026-27 but India may see inflationary expectations in the year ahead.

During FY26, the Monetary Policy Committee (MPC) continued to follow a calibrated and data- dependent monetary policy approach in response to moderating inflation and evolving global and domestic

macroeconomic conditions. Building on the easing cycle initiated in the latter part of FY 2025-26, the Reserve Bank of India (RBI) further reduced the policy repo rate by a cumulative 100 basis points during the FY, bringing the rate to 5.25% by the end of the calendar year. The MPC maintained a balanced stance throughout the year, closely monitoring inflation trajectory, growth momentum, liquidity conditions, and external sector developments. Additionally, the Reserve Bank of India (RBI) cut the Cash Reserve Ratio (CRR) by 100 bps during FY 2025-26 to spur the liquidity in the Banking system.

Indiacontinuedtoremainoneofthefastest-growingmajor economies during FY26, supported by resilient domestic demand, steady Government capital expenditure, and improved private consumption. Economic activity was underpinned by robust performance in the services sector and sustained momentum in infrastructure and manufacturing activities. Inflation moderated during the year and broadly remained within the Reserve Bank of India's tolerance band, although intermittent pressures from food and energy prices persisted. Retail inflation remained relatively contained, aided by easing food prices and supportive supply-side measures. Financial markets remained volatile through the year due to uncertainty surrounding global interest rate movements, geopolitical developments, energy price fluctuations, and foreign portfolio investment outflows. Equity markets witnessed intermittent corrections amid rising concerns over global growth and geopolitical risks.

India's bond market experienced fluctuations during FY26, influenced by global yield movements, inflation expectations, liquidity conditions, and evolving monetary policy expectations. Domestic bond yields remained relatively supported by prudent fiscal management, continued investor participation in Indian debt markets, and RBI liquidity operations. Meanwhile, the Indian Rupee witnessed rapid phases of depreciation (9.88% of depreciation during FY 2025-26) and consolidation against the US Dollar amid strengthening global dollar demand, elevated crude oil prices, and external sector pressures. Despite volatility, India's macroeconomic fundamentals and foreign exchange reserve position continued to provide stability to the currency market. However, FY26 was a dynamic year for the Indian Rupee, marked by phases of relative stability interspersed with bouts of volatility driven by evolving global macroeconomic conditions, geopolitical developments, and fluctuations in foreign capital flows. While the Indian Rupee remained broadly range-bound during the early part of the year, pressure on emerging market currencies amid a strong US dollar environment and elevated crude oil prices led to intermittent depreciation in the latter half of FY26. Movements in the currency

market were further influenced by global interest rate expectations, trade-related uncertainties, and foreign portfolio investor activity. Despite these pressures, the Indian Rupee demonstrated resilience supported by India's robust macroeconomic fundamentals, healthy foreign exchange reserves, and timely interventions by the Reserve Bank of India (RBI) to ensure orderly market conditions.

The Bank's gross investment portfolio stood at Rs27,418.36 crore as on March 31, 2026, compared to Rs21,856.51 crore as on March 31, 2025, up by 25.45%. Investment Deposit ratio moved to 22.23% as on March 31, 2026 from 20.33% as on March 31, 2025. Profit on sale of investment for FY 2025-26 stood at Rs339.65 crore. Total interest income from investment for the year was Rs1,789.48 crore (Inclusive of dividend income of Rs4.03 crore and amortisation cost of -Rs110.67 crore). Yield on investments (profit + interest earned to average investments) during FY 2025-26 was 7.78%.

During FY26, the fixed income instruments trading desk, equity trading desk, and forex trading desk within the Treasury Department managed their portfolios prudently through data-driven analysis and disciplined risk management amid evolving market conditions. The SLR trading desk effectively planned and executed the Bank's participation in the Government Securities market while efficiently managing the Held-To-Maturity (HTM) portfolio in a dynamic interest rate environment while SLR Trading Desk, Equity Trading Desk and Forex Trading Desks had recorded one of the highest profit in the Financial Year.

The equity trading desk adopted calibrated investment strategies in the secondary market and actively participated in select primary market issuances, capitalizing on market opportunities during the year. The forex trading desk also contributed meaningfully to the overall treasury performance through well-timed and strategic trading positions amidst currency market volatility. Overall, the Treasury function delivered a strong performance (highest ever yearly profits) during FY26, supported by prudent portfolio management, strategic market positioning, and effective risk management practices.

The Fund Management and Money Markets Desks at Treasury Department successfully managed the liquidity risk by maintaining appropriate levels of surplus funds and ensuring optimum return on the same. The desk also ensured compliance with the regulatory requirements for Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR). Besides the above, the Forex Merchant Desk within the Treasury Department continued to provide the Bank's customers with comprehensive foreign exchange risk hedging solutions and remittance-related services during FY26.

Forex Merchant activities contributed significantly to the overall Treasury performance during the year, supported by increased customer engagement, higher transaction volumes, and effective market execution.

Going forward, the Treasury Department intends to further strengthen its focus on the Forex Merchant Business and allied customer-centric offerings with the objective of diversifying revenue streams and enhancing fee-based income. During FY26, the Treasury function continued to leverage the recently implemented Treasury Management Software, which has enhanced the product portfolio, improved operational efficiency and dealer productivity, and strengthened accuracy in back-office processing and accounting functions. Overall, FY26 was a productive and significant year for the Treasury Department, marked by improved operational capabilities, prudent market participation, and sustained business growth.

NON-PERFORMING ASSETS (NPA)

During FY 2025-26, the Bank was able to consistently continue with the improved performance in the recovery front, highlighting the asset quality of the Bank and thereby recording its best-ever performance across several key parameters. Driven by focused recovery strategies, robust credit monitoring, and well-structured processes, the Bank registered total recoveries of Rs1,352.72 Crores, including cash recoveries of Rs1,188.64 Crores. The Bank effectively leveraged both legal and non-legal recovery mechanisms, while a substantial number of stressed accounts were resolved through negotiated settlements.

Enhanced collection efficiency and proactive monitoring led to a sharp reduction in SMA-2 accounts to Rs181.83 Crores as at March 31,2026, from Rs300.80 Crores during the previous year. The Bank has achieved historic milestones in GNPA and NNPA ratios. Incremental NPAs were tightly controlled, with additions to Gross NPA restricted to Rs719.32 crore as against Rs1,176.45 crore during FY 2024-25. As a result, the Bank recorded a remarkable improvement in asset quality, with the Gross NPA ratio declining to 1.43% from 3.20%, while Net NPA reduced to Rs287.93 Crores as on March 31, 2026, from Rs790.52 Crores as on March 31, 2025. In percentage terms, Net NPA improved significantly to 0.29% from 0.92%.

These achievements represent a significant improvement in the Bank's asset quality profile and underscore the effectiveness of its recovery framework, risk management practices, and credit underwriting. The Bank remains committed to further strengthening its recovery ecosystem and credit processes to sustain this momentum and deliver continued excellence in asset quality and portfolio performance.

RISK MANAGEMENT

The Risk Management processes are guided by well- defined policies appropriate for various risk categories, independent risk oversight, and periodic monitoring through the committees of the Board of Directors. The objective of risk management is not to prohibit or prevent risk taking activity, but to ensure that the risks are consciously taken with full knowledge, purpose and clear understanding so that it can be measured and mitigated. The essential functions of Risk Management are to identify, measure and more importantly monitor the risk profile of the Bank. Managing risk is fundamental to banking and is the key to sustained profitability and stability. Management of risk aims to achieve the best trade-off between risk and return and to maximize Risk Adjusted Return on Capital (RAROC). Sound risk management is critical to a Bank's success. Business and revenue growth have therefore to be aligned with risk appetite in the context of the risks embedded in the Bank's business strategy and balance sheet. Of the various types of risks the Bank is exposed to, the most significant are credit risk, market risk and operational risk. The identification, measurement, monitoring and mitigation of risks continue to be key focus areas for the Bank.

The Risk Management function attempts to anticipate vulnerabilities at the transaction level or at the portfolio level through qualitative and quantitative examinations of the embedded risks. The Risk Management strategy of the Bank is based on a clear understanding of various risks, disciplined risk assessment, risk measurement procedures and continuous monitoring for mitigation. The policies and procedures established for this purpose are continuously evaluated and benchmarked against the best practices followed in the industry. Through continuous refinement/improvement of the risk measurement/ management systems, including automation of feasible processes, the Bank aims to ensure regulatory compliance as well as better return on and utilization of capital in line with the business objectives.

Comprehensive review of Credit Risk Policy and other Risk Management Policies are undertaken along with other process improvements. Liquidity is also actively being managed through the ALCO forum, where the Bank is pursuing actively into increasing the sticky and retail deposits along with operationalizing majority of the wholesale banking financing relationships. As part of the Business Continuity Management, the Bank's Operational Risk team is working in close coordination with various stakeholders to ensure smooth conduct of operations.

RISK MANAGEMENT POLICY FRAMEWORK

The Bank has a comprehensive policy framework which contains separate policies for identification, measurement and management of all material risks including but not limited to credit, market, operational, liquidity and other Pillar-II risks. The Bank has put in place integrated risk management policies which ensures independence of the risk governance structure. The required standard operating procedures to ensures that all the parameters are well covered while implementing the approved Policies. The details of Risk Management practices are provided in the Management Discussion and Analysis Report.

COMPLIANCE WITH CAPITAL ADEQUACY FRAMEWORK

In compliance with regulatory guidelines on Pillar I of Basel III norms, the Bank has computed capital charge for credit risk as per the Standardized Approach, for market risk as per the Standardized Duration Method and for operational risk as per the Basic Indicator Approach. To address Pillar II risk, the Bank has implemented ICAAP (Internal Capital Adequacy Assessment Process), to integrate capital planning with budgetary planning and to capture residual risks which are not addressed in Pillar I, like credit concentration risk, interest rate risk in the banking book, liquidity risk, earnings risk, strategic risk, reputation risk, pension obligation risk etc. The Bank has adopted a common framework for additional disclosures under Pillar III for adhering to the market discipline norms of Basel III guidelines. This requires the Bank to disclose its risk exposures, risk assessment processes and its capital adequacy to the market in a consistent and comprehensive manner.

PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO PURSUANT TO SUB SECTION (3)(M) OF SECTION 134 OF THE COMPANIES ACT, 2013 READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

The Bank ensures strict compliance with all statutory requirements and voluntarily undertakes several sustainable steps to contribute towards a better environment. The Bank has undertaken various initiatives for energy conservation at its premises, and to reduce its carbon footprint and improve resource efficiency. It ranges from using better technology to improved energy efficiency, recycling and generating energy from renewable sources. A detailed report on the same is included in the Business Responsibility and Sustainability Report forming part of this Annual Report. We have engaged with certified agencies to handle disposal of plastic, E-waste, hazardous and other waste, as per our safe and sustainable Waste Management

Policy. Furthermore, the Bank ensures to invest in k specific technologies to improve the environmental and k , social impacts of product and processes. Digitization s of agreements, paper-less electronic BG issuance, l s , digitization of loan-processing, dispatch of documents e l, to security holders in electronic form are a few of our various green initiatives. Hence, sustainability is integral e s to our ethos, and we are committed to minimizing our e t environmental footprint and contributing positively to the communities we serve. The Bank, being a banking g company and an authorized dealer in Foreign Exchange, n has taken all possible steps to enhance export credit. Through its export financing operations, the Bank supports and encourages the country's export efforts.

K

Disclosure under the Sexual Harassment of Women >f at Workplace (Prevention, Prohibition and Redressal) ir Act, 2013

t

' The Bank maintains a policy of zero tolerance towards

o any action on the part of any executive/employees

p which may fall under the ambit of 'Sexual Harassment' P o at workplace and is fully committed to uphold and d maintain the dignity of every women staff working in the d n Bank. The Bank has constituted an Internal Committee n ("IC") at the Corporate Office together with Regional n c level sub-committees, in compliance with provisions e c relating to the constitution of the Internal Committee l under the Sexual Harassment of Women at Workplace ^ (Prevention, Prohibition and Redressal) Act, 2013 [14 of 2013]. The Policy provides for protection against sexual s harassment of women at workplace and for prevention and redressal of such complaints. All the employees are covered under this Policy. Each committee is chaired by a Senior Woman Executive and includes an External F Member possessing the requisite legal and social N sector expertise, thereby meeting every requirement of T section 4 of the Act. Detailed records of proceedings, E decisions and follow-up actions are maintained and E are open to inspection by the appropriate authorities. Through regular classroom sessions and mandatory e-learning modules, the Bank continues to sensitize its y l workforce on acceptable workplace conduct and on the r l avenues of redressal available to them, underscoring ir our commitment to a respectful and secure working

d s environment for every employee.

e Number of cases filed, if any, and their disposal under o section 22 of the Sexual Harassment of Women at g Workplace (Prevention, Prohibition and Redressal) n Act, 2013

d (a) Number of complaints of sexual harassment received

t. in the year- 4

e

, (b) Number of complaints disposed of during the year

it -4

(c) Number of cases pending for more than ninety days - Nil

All the complaints were investigated in accordance with the prescribed procedure and resolved well withir the statutory ninety-day timeframe. Further, no mattei remained pending as at 31 st March, 2026.

Disclosure under Maternity Benefit Act, 1961

The Bank affirms full compliance with the Maternity Benefit Act, 1961 and other regulatory requirements applicable to the Bank from time to time. All women employees are entitled to twenty-six weeks of paic maternity leave, during which salary, allowances and insurance coverage remain unaltered. On completion of leave, every returning mother may opt for a posting at a branch located near her domicile or any centre of her choice, ensuring a smoother transition back to work. The staff health-insurance scheme continues throughout the leave period and covers both mothe and child from the date of delivery. Complementing these statutory entitlements, the Bank's Staff Welfare Leave Scheme permits additional child-care leave.

Compliance with Rights of Persons with Disabilities Act, 2016

The Bank has implemented various accessibility measures across its physical and digital touchpoints to foster an inclusive and accessible banking environmen for customers with disabilities, in compliance with the Rights of Persons with Disabilities Act, 2016 and the regulatory guidelines issued by the Reserve Bank o India (RBI) and the Securities and Exchange Board ol India (SEBI), across its branches, offices, ATMs and digital channels for an inclusive and accessible banking environment for customers with disabilities . The Bank is undertaking a comprehensive revamp of its website to further enhance accessibility and align with evolving regulatory and industry standards.

To facilitate seamless access to banking services mos of the Bank's branches and offices are situated on the ground floor and are equipped with ramp facilities wherever possible, for differently abled visitors and senior citizens. Dedicated service arrangements including separate counters or single-window facilities, are provided wherever feasible, supported by accessibility features such as ATMs with Braille-enabled keypads and voice guidance facilities, magnifying glasses, and other assistive infrastructure.

The Bank has also initiated a detailed assessment to identify additional measures for improving accessibility across its operations, the findings of which are planned to be implemented in the coming years. The Bank remains committed to continuously strengthening accessibility across its physical and digital channels to

ensure equitable, dignified and convenient access to banking services for all its stakeholders.

Particulars of Employees

The Bank had 9,147 employees as on March 31, 2026. Please note that the details of the top 10 employees including the employees who were in receipt of aggregate remuneration of more than Rs1.02 crore per annum (employed throughout the year) or who were in receipt of remuneration of Rs8.5 lakhs per month (employed for a part of the year) during the FY 2025-26, in terms of remuneration drawn pursuant to provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be made available for inspection at the Registered Office of the Bank during the working hours up to the date of ensuing AGM and any members who is interested in obtaining these particulars may write up to the Company Secretary of the Bank. The ratio of the remuneration of each director to the median employees' remuneration and other details in terms of sub-section 12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed to this report (Annexure A).

Number of Employees as at the closure of Financial Year 2025-26:

THE ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES:

A brief outline of the Bank's CSR Policy, including overview of projects or programs undertaken/to be undertaken.

South Indian Bank's CSR Policy

At South Indian Bank, Corporate Social Responsibility (CSR) is embedded in the Bank's core values and reflects its commitment towards sustainable and inclusive growth. The Bank recognizes that its longterm success is closely linked with the well-being of the communities it serves and therefore continues to integrate social and environmental considerations into its business philosophy and operations.

In compliance with the provisions of Section 135 of the Companies Act, 2013 and the applicable CSR Rules,

the Bank undertook various need-based and impact- oriented CSR initiatives during FY 2025-26. The Bank's CSR interventions were focused on key areas including education, healthcare, sanitation, environmental sustainability, rural development, empowerment of women skill development, support for differently abled persons, promotion of sports, financial literacy, preservation of heritage and culture, and community welfare.

The Bank implemented its CSR programmes in association with reputed charitable institutions, educational and healthcare organizations, Local Self-Government Bodies, and Non-Governmental Organizations. Major initiatives undertaken during the year included support to special schools, old age homes and orphanages, healthcare and sanitation programmes, vocational training and livelihood enhancement initiatives, environmental conservation activities, rural infrastructure development projects, establishment of libraries, financial literacy programmes, and assistance for differently abled persons.

The Bank continues to strengthen its CSR governance framework through structured monitoring and review mechanisms to ensure transparency, accountability, and effective implementation of CSR projects. The initiatives undertaken during the year reflect the Bank's enduring commitment towards creating sustainable social impact and contributing to inclusive socioeconomic development.

CSR Expenditure:

During FY 2025-26, the Bank spent a total amount of Rs32.35 Crores towards CSR activities in accordance with the provisions of the Companies Act, 2013. Detailed disclosures relating to the CSR initiatives undertaken during the year are provided in Annexure 'B' to this Report.

Web-Link to the CSR Policy

The CSR Policy of the Bank is available on the Bank's website at:

FINANCIAL INCLUSION

Financial inclusion refers to providing affordable, timely, and adequate access to financial services such as savings accounts, credit, insurance, remittance facilities, and digital payment systems to all sections of society, especially the underserved and weaker sections. It aims to integrate every individual into the formal financial system, thereby promoting economic stability and inclusive growth.

Financial inclusion offers several benefits. It encourages savings habits among people and ensures safe

custody of money. Access to formal credit helps small businesses, farmers, and MSMEs avoid dependence on informal money lenders charging high interest rates. It also supports women empowerment and selfemployment opportunities by enabling access to loans and financial assistance.

As part of Financial Inclusion initiatives, bank has expanded to rural and remote areas through Business Correspondents, mobile banking, and schemes like PMJDY, APY, PMJJBY, PMSBY.

Through corporate business correspondents, Bank has on-boarded 30,475 borrowers with total outstanding of Rs164.90 crores in the FY 2025-26 in the agriculture lending, hence reaching out to the unserved and underserved strata of the Society.

Aadhaar Enabled Payment System (AePS)

Aadhaar Enabled Payment System (AePS) is a payment service, empowering a bank customer to use Aadhaar as his/her identity to access his/her respective Aadhaar enabled bank account and perform basic banking transactions through a Business Correspondent / POS machine. National Payment Corporation of India (NPCI), an umbrella organisation for all retail payments, controls AePS operations. AePS offers basic banking services such as Cash Withdrawal, Cash Deposit, Balance Enquiry, Aadhaar to Aadhaar Fund Transfer and Mini Statement. The Bank has also successfully migrated to Aadhaar Enabled Payment System (AePS) for performing transactions through Business Correspondents.

Business Correspondent

With a view of expanding banking penetration, promoting digital inclusion, and supporting inclusive economic growth in India at an affordable cost, the Bank has active BCs in the states of Kerala and Tamil Nadu.

The Bank has adopted Corporate Business Correspondent structure with 24 Business Correspondents for strengthening financial inclusion and improving banking outreach.

The wholly outsourced BC model will complement the Bank's strength to increase business volume and improve efficiency of operations. Through this arrangement, the Bank is ensuring that the Business Correspondent meets the benchmark performance standards at all stages of delivery of services, without diluting Bank's values and principles, control mechanisms, business processes or goodwill and reputation.

Financial Literacy Counsellors

Financial Literacy Counsellors play a vital role in spreading awareness about responsible financial practices among the public. They educate people on

savings, budgeting, digital banking, insurance, pensions, credit discipline, and fraud prevention. Their guidance helps individuals make informed financial decisions, avoid over-indebtedness, and improve financial wellbeing.

They also support vulnerable sections such as rural households, senior citizens, students, MSMEs, and low-income groups by explaining banking products and Government schemes in simple language. Through camps, counselling sessions, and awareness programs, Financial Literacy Counsellors strengthen financial inclusion and promote safe and effective use of formal banking services.

As on March 31, 2026, Bank has engaged 16 FLCs in different parts of Kerala, at Block-level to disseminate financial literacy to the people. In addition to this, the Bank has also appointed 6 FLCs in different Districts of Tamil Nadu to emphasize the objectives of Financial Literacy. Bank's FLCs are branded under the name "SIB JYOTHIS". A Board approved Policy covering all aspects of Financial Literacy Counsellors has been formulated, giving due consideration to the revised guidelines on FLCs issued by the RBI.

Pradhan Mantri Jan-Dhan Yojana (PMJDY)

The Pradhan Mantri Jan-Dhan Yojana (PMJDY) is a flagship financial inclusion initiative launched to ensure universal access to banking services for every household. The scheme provides basic savings bank accounts with facilities such as RuPay debit cards, direct benefit transfer, overdraft facility, insurance coverage, and access to pension schemes.

PMJDY has played a major role in bringing unbanked sections into the formal banking system, especially in rural and economically weaker areas. It has strengthened financial inclusion, promoted digital banking, enabled transparent transfer of Government benefits, and encouraged a culture of savings among the public.

Under the scheme, a Basic Savings Bank Deposit (BSBD) account can be opened in any bank branch or Business Correspondent (Bank Mitra) outlet, by persons who do not have any other account.

Atal Pension Yojana (APY)

Atal Pension Yojana (APY), a pension scheme for citizens of India is focused on the unorganized sector workers. Under the APY, guaranteed minimum pension ranging from Rs1,000/- to Rs5,000/- per month will be given at the age of 60 years depending on the contributions by the subscribers. Any citizen who is or has been an income taxpayer, shall not be eligible to join APY from 01 st October, 2022.

The benefit of minimum pension under Atal Pension

Yojana would be guaranteed by the Government in the sense that if the actual realized returns on the pension contributions are less than the assumed returns for minimum guaranteed pension, over the period of contribution, such shortfall shall be funded by the Government. On the other hand, if the actual returns on the pension contributions are higher than the assumed returns for minimum guaranteed pension, over the period of contribution, such excess shall be credited to the subscriber's account, resulting in enhanced scheme benefits to the subscribers.

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

The Pradhan Mantri Jeevan Jyoti Bima Yojana is available to people in the age group of 18 to 50 years having a Bank account who give their consent to enable auto-debit. Aadhar would be the primary KYC for the Bank account. The life cover of Rs2 lakhs shall be for the one-year period stretching from 1 st June to 31 st May and will be renewable. The PMJJBY offers an annual life coverage of Rs2 lakhs in case of the demise of the policyholder during the policy term. The policy can be availed at the lowest premium rate of Rs436 per annum.

Pradhan Mantri Suraksha Bhima Yojana (PMSBY)

The Bank extends PMSBY social scheme to provide financial protection against accidental death or disability; the affordable lower premium is useful especially for people in low income and unorganized sectors.

GREEN INITIATIVE IN CORPORATE GOVERNANCE

Dispatch of documents in Electronic Form:

As a responsible corporate citizen, the Bank supports and pursues the 'Green Initiative' of the Ministry of Corporate Affairs ("MCA"). In conformance with such initiatives and in terms of Rule 18 of the Companies (Management and Administration) Rules, 2014, the Bank may give Notice through electronic mode including e-mail to those Members who have provided their e-mail address either to their Depository Participants (DPs) or to the Registrar/Company. Pursuant to General Circulars 03/2025 dated September 22, 2025 issued by MCA and SEBI Circular No. SEBI/HO/DDHS/DDHS PoD-1/P/CIR/2025/83 dated June 05, 2025 on Limited relaxation from compliance with certain provisions of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015, Master Circular No. SEBI/HO/DDHS/ DDHS-PoD-1/P/CIR/2025/0000000103 dated July 11, 2025, updated Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026 and SEBI Circular No. SEBI/HO/CFD/ CFD-PoD-2/P/ CIR/2024/133 dated October 03, 2024 on Relaxation from compliance with certain provisions of the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015, the Notice of 98 th Annual General Meeting (to shareholders) and the Annual Report 2025-26 (to shareholders) will be sent via email to all the shareholders and no physical copies will be sent via post. However, in compliance with amended regulation 36(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Bank will be sending a letter providing the web-link, including the exact path, where complete details of the Annual Report is available to those shareholder(s) who have not registered their email address.

Further, in terms of Regulation 36 of the Listing Regulations, the listed entity is required to send soft copies of its Annual Report to all those shareholder(s), who have registered their email address for this purpose. Accordingly, the documents including the Notice and explanatory statement of 98 th Annual General Meeting, Annual Report of the Bank for the Financial Year 202526 including Standalone and Consolidated Audited Financial Statements, Directors' Report, Auditors' Report etc., for the year ended March 31, 2026, will be sending to the e-mail address registered with their Depository Participant (DP)/Registrar/Company. The e-mail addresses indicated in respective DP accounts which will be periodically downloaded from NSDL/CDSL will be deemed to be their registered e-mail address for serving notices/documents including those covered under Section 136 of the Companies Act, 2013. In case a Member, whose e-mail address has changed, fails to update this new e-mail address, the said documents will be sent to the existing e-mail address and the said documents will be deemed to have been delivered, in compliance with the relevant provisions of the Companies Act, 2013, the relevant Rules made thereunder and the Listing Regulations. Members who have not yet registered their e-mail address are requested to do so, at the earliest. In case of shares held in electronic form and in case of any change in the e-mail address, Members are requested to update the same with their DP and in case of shares held in Physical form, Members are requested to update the same with the RTA/Company. Shareholders may please note that, as allowed by MCA and SEBI circulars, the Bank will not be sending physical copies of AGM Notice to shareholders and Annual Report to the shareholders unless the same is specifically requested. Further, the Bank will send a letter providing the web-link, including the exact path, where complete details of Annual Report and AGM Notice available to those shareholders, who have not registered their email addresses with the Depositories/Bank/RTA.

Please note that the said documents will also be uploaded on the Bank's website and copies thereof will be made available for

inspection at the Registered Office of the Bank during 10.00 a.m. to 3.00 p.m. on all working days except Saturdays, Sundays, Bank Holidays and Public Holidays up to the date of ensuing AGM. Shareholders have been requested on several occasions to update their e-mail IDs in their folio/ Demat Account to help accelerate the Bank's migration for paperless compliances. The Bank seeks your support for the said green initiatives, as it is designed to protect our fragile environment.

Further, as a part of green initiatives by the Bank, all relevant agenda papers pertaining to the Board/ Committee are being circulated in advance to the Board of Directors through electronic mode to facilitate easy access of agenda which would provide sufficient time to the Board for reading and understanding the proposals placed in a meeting.

ANTI - MONEY LAUNDERING (AML)

Transactions processed through the Core Banking Solution and other ancillary systems are monitored for detecting suspicious transactions, using an AML application to comply with the provisions under Prevention of Money Laundering Act (PMLA) by a centralized AML cell within Compliance Department. The Bank already has a Centralized Processing Centre (CPC) for customer creation with the objective of full KYC compliance and to use KYC as a fraud prevention tool. The Bank has attached great importance for compliance of KYC/AML/CFT norms by the customers as per the Reserve Bank of India directive.

FATCA-CRS

The Bank has been registered as a reporting entity under FATCA, under GIIN No. IIK7HU.99999.SL.356, to comply with the reporting requirement under the interGovernmental agreement entered between Indian and US Government and the CRS Multilateral Competent Authority Agreement.

DIRECTORS

The composition of the Board of Directors is governed by the Banking Regulation Act,1949, the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Code of Conduct on Corporate Governance adopted by the Bank. The Board comprises of 10 Directors as on the date of this Report, with rich experience and specialized knowledge in various areas of relevance to the Bank, including Banking, Accountancy, Risk Management, Treasury, Finance, Business Management, Small scale Industry, Agriculture, Law, Human Resources and Information Technology.

Except 2 Directors, all members of the Board are NonExecutive Directors and 6 Directors out of the total

10 Directors are Independent Directors. Declaration has been obtained from the Independent Directors as required under the RBI Regulations, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013. The remuneration and other benefits paid to MD & CEO of the Bank, Executive Director and other Non-Executive and Independent Directors during the Financial Year 202526 are disclosed in Corporate Governance Report. Vide Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019 an online data bank for the Independent Directors ("Data Bank") has been rolled out by the Indian Institute of Corporate Affairs, all the Independent Directors of the Bank had registered themselves in the Data Bank in compliance with the same.

During the 97 th Annual General Meeting held on August 20, 2025, as recommended by the Bank, the shareholders accorded their approval for the following:

- To appoint a Director in the place of Sri. Benny P Thomas (DIN: 09448424) who retires by rotation under Section 152 of the Companies Act, 2013 and being eligible, offers himself for re-appointment.

- To re-appoint Sri. R A Sankara Narayanan (DIN: 05230407) as Independent Director of the Bank.

Sri. R A Sankara Narayanan (DIN: 05230407) was appointed as an Additional Independent Director pursuant to Section 161(1) of the Companies Act, 2013 on 15 th October 2020. Further he was appointed as Independent Director of the Bank, for the purpose of Section 149 of the Companies Act, 2013 for a period of five (5) consecutive years, not liable to retire by rotation by shareholders at 93 rd Annual General Meeting of the Bank held on August 18, 2021. Further he was appointed for a second term for a further period of three years w.e.f. October 15, 2025, as 'Non-Executive Independent Director' of the Bank, for the purpose of Section 149 of the Companies Act, 2013, to hold office till 14 th October 2028, not liable to retire by rotation.

The Board of Directors has recommended to members:

- To appoint a Director in the place of Sri. Dolphy Jose (DIN: 10682246) who retires by rotation under Section 152 of the Companies Act, 2013 and being eligible, offers himself for re-appointment.

- To appoint Sri. Mahesh Muralidhar Pai (DIN: 09164982) as Director on the Board of the Bank and as Managing Director & Chief Executive Officer of the Bank and to approve his terms and conditions of appointment including remuneration.

- To re-appoint Smt. Lakshmi Ramakrishna Srinivas (DIN:10365580) as Independent Director of the Bank,

who was appointed by the Board of Directors on November 20, 2023, and appointed by Shareholders at the Postal Ballot concluded on Sunday, December 24, 2023, for a period of 3 years, and in respect of whom the Bank has received a notice in writing, proposing her candidature for the office of Director of the Bank, for a second term as 'Non-Executive Independent Director' of the Bank, for the purpose of Section 149 of the Companies Act, 2013, to hold office for a period not exceeding five(5) consecutive years, not liable to retire by rotation.

Necessary information pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, in respect of directors to be re-appointed at the ensuing Annual General Meeting are given in the Annexure to the Notice convening the Annual General Meeting scheduled to be held on August 20, 2026.

None of the Directors of the Bank are disqualified from being appointed as Directors, as specified in Section 164 (1), Section 164 (2) and Rule 14(1) of Companies (Appointment and Qualification of Directors) Rules, 2014.

CHANGE IN KEY MANAGERIAL PERSONNEL

Sri. Biju E Punnachalil, General Manager, Chief Risk Officer and Key Managerial Personnel has opted for Voluntary Retirement from the service of the Bank and exited on July 11, 2025.

Composition of Audit Committee

The Audit Committee of the Board is chaired by Sri. M George Korah (DIN: 08207827) (Non-Executive Independent Director), who is a Chartered Accountant. The other members of the committee are Sri. Pradeep M Godbole (DIN: 08259944) (Non- Executive Independent Director), Sri. R A Sankara Narayanan (DIN: 05230407) (Non- Executive Independent Director), Smt. Lakshmi Ramakrishna Srinivas (DIN:10365580) (Non- Executive Independent Director) and Sri. Thomson Thomas (DIN: 06948598) (Non- Executive Independent Director). The constitution of the Committee is in compliance with the regulatory requirements. The terms of reference of the Audit Committee are in accordance with the SEBI (LODR) Regulations, 2015, Companies Act, 2013 and RBI guidelines.

Independent Directors

In terms of the definition of Independence of Director as prescribed under Regulation 16(1) (b) of the SEBI (LODR) Regulations, 2015 and Section 149(6) of Companies Act, 2013 and based on the confirmation/disclosures received from the Directors, the following Directors are Independent Directors of the Bank as on the date of this report.

1. Sri. Jose Joseph Kattoor (DIN: 09213852)

2. Sri. M George Korah (DIN: 08207827)

3. Sri. Pradeep M Godbole (DIN: 08259944)

4. Sri. R A Sankara Narayanan (DIN: 05230407)

5. Smt. Lakshmi Ramakrishna Srinivas (DIN:10365580)

6. Sri. Thomson Thomas (DIN: 06948598)

The Bank has received declaration from all the Independent Directors that they continue to meet the criteria of independence as provided under the Companies Act, 2013 (the Act) and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and comply with the Code for Independent Directors as specified under Schedule IV of the Act. In terms of the Companies (Creation and Maintenance of databank of Independent Directors) Rules, 2019 read with the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019, the Independent Directors of the Bank have enrolled his/ her name in the online databank of Independent Directors maintained by the Government. Further all the Independent Directors have either qualified or being eligible obtained exemption from the online proficiency self-assessment test as per Companies (Appointment and Qualification of Directors) Rules, 2014.

The Independent Directors have also confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence. In the opinion of the Board, the Independent Directors possess the requisite expertise and experience and the persons of high integrity and repute. They fulfil the conditions specified in the Act and the Rules made thereunder and are independent of the Management.

Women Directors

In terms of the provisions of Section 149 of the Companies Act, 2013 and Regulation 17 of the SEBI (LODR) Regulations 2015, the Bank has appointed Smt. Lakshmi Ramakrishna Srinivas (DIN:10365580) as Woman Director to the Board of the Bank.

Bank's policy on directors' appointment and remuneration including criteria for determining qualification, positive attributes, independence of a director and other matters provided under subsection (3) of Section 178 .

The Nomination Policy of the Bank can be accessed at

Criteria for appointment as a Director of the Bank:

Nomination and Remuneration Committee of the Board shall identify and ascertain the integrity, qualification, expertise and experience of the person who is considered for being appointed/reappointed as Director of the Bank and apply due diligence in compliance with The Banking Regulation Act,1949, Reserve Bank of India directives on Fit & Proper Criteria, all other applicable provisions of the Companies Act,2013 and SEBI(LODR) Regulations,2015 including any amendments from time to time.

The Nomination and Remuneration Committee shall obtain all applicable declarations & undertaking as provided under Banking Regulation Act,1949, RBI Guidelines, The Companies Act,2013, Companies (Appointment and Qualification of Director) Rule,2014, SEBI Guidelines, SEBI(LODR)Regulations,2015 and ensure that the proposed person is not ineligible to be appointed/re-appointed as a Director of the Bank. In case of Independent Directors, the Nomination and Remuneration Committee shall ensure that the Independent Directors meet the criteria of Independence as laid down in the Companies Act,2013 and the rules made thereunder and SEBI (LODR) Regulations,2015.

Criteria for determining qualifications, positive attributes:

While recommending any potential new Board member(s)/re-appointment of existing member(s) to the Board, the Committee shall consider the following:

a) Professional and personal ethics, integrity and track record;

b) Special knowledge or practical experience in Banking, Accountancy, Agriculture and Rural Economy, Co-operation, Economics, Finance, Law, Small-Scale Industry, Information Technology, Payment & Settlement Systems, Human Resources, Risk Management, Business Management or any other matter useful to the Banking Company in the opinion of Reserve Bank of India;

c) Ability to provide insights and practical wisdom based on their experience and expertise relevant to the Bank's line of business;

d) Details of his/her association with other Companies/ LLPs/Firms(including NBFC);

e) Details of substantial interest in other Companies/ LLPs/Firms (including NBFC);

f) Details of financial facilities, if any, availed from the Bank;

g) Details of default in the re-payment of loans, availed

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h) Commitment to enhancing stockholder value;

i) Ability to develop a good working relationship with members of the Board and contribute to the working relationship with Senior Management of the Bank;

j) Whether he/she suffers from any of the disqualifications envisaged under the provision of Banking Regulation Act, 1949, Companies Act, 2013 and Listing Regulations;

k) Any other factors as the Committee may deem fit and in the best interests of the Bank and its stockholders;

Criteria for determining Independence of a Director

The criteria of Independence of a Director is determined based on conditions as laid down in the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. The Independent Director shall at the first meeting of the Board in which he/she participates as a Director and thereafter at the first meeting of the Board in every financial year or whenever there is any change in the circumstances which may affect his/her status as an Independent Director, give a declaration that he/she meets the criteria of Independence.

REMUNERATION POLICY

The Remuneration Policy for Whole-Time Directors, Part-time Chairman, Non-Executive Directors and Employees of the Bank:

The Bank has a Board approved Compensation Policy which deals with the Compensation & Benefits of the Whole-Time Directors, Part-time Chairman, NonExecutive Directors and Employees of the Bank.

The objectives of the Compensation Policy of the Bank inter-alia includes, to provide a fair and persistent basis for motivating, inspiring and rewarding the employees appropriately, according to their jobs/role size, performance, accomplishments, contribution, skill, aptitude and competence, to implement standards on sound compensation practices and incentives and to provide effective governance of compensation payable to the WTDs/CEO and other staff, alignment of compensation with prudent risk taking and effective supervisory oversight. The disclosure requirement of the remuneration is separately provided in "Basel III- Pillar 3 Disclosures".

Remuneration of Whole-Time Directors/MD & CEO and Material Risk Takers:

The Board approved Compensation Policy deals with the Compensation & Benefits of the WholeTime Directors/MD & CEO/Material Risk Takers. The remuneration of the Whole-Time Directors/MD & CEO/

Material Risk Takers is recommended by the Nomination & Remuneration Committee (NRC) to the Board for approval after considering the factors prescribed under the Compensation Policy. The Compensation Policy factors the guidelines issued by the RBI from time to time.

The Board considers the recommendations of NRC and approves the remuneration, with or without modifications, subject to shareholders' and regulatory approvals. The remuneration payable to WholeTime Directors/MD & CEO is subject to prior approval of the Reserve Bank of India (RBI). Therefore, the remuneration or any revision in remuneration to WholeTime Directors/MD & CEO is payable only after receipt of the approval from RBI.

The compensation paid out to the referred functionaries is divided into two components:

The fixed compensation is determined based on the relevant factors such as industry standards, the exposure, skill sets, talent and qualification attained by the official over his/her career span and adherence to statutory requirements. All the fixed items of compensation, including the perquisites, will be treated as part of fixed pay. Perquisites that are reimbursable would also be included in the fixed pay so long as there are monetary ceilings on these reimbursements. Contributions towards superannuation/retirement benefits will also be treated as part of fixed pay.

The variable compensation for Whole-Time Directors, Managing Director & Chief Executive Officer and Material Risk Takers is fixed based on organizational performance (both business-unit and firm-wide) and KPAs set for the Official. The organization's performance is charted based on Performance Scorecard which takes into account various financial indicators like revenue earned, cost deployed, profit earned, NPA position and other intangible factors like leadership and employee development. The Performance Parameters provides a mix of Financial and Non-Financial, Quantitative and Qualitative Metrics. The variable pay is paid in the form of a mix of cash and/or share linked instruments. While considering/recommending the variable pay in respect of Managing Director & CEO, MRTs and WholeTime Directors, serious supervisory and regulatory observations (if any) shall be factored.

Risk, Control and Compliance Staff

Members of staff engaged in financial and risk control, including internal audit, are compensated in a manner that is independent of the business areas they oversee and commensurate with their key role in the Bank. The total fixed and variable compensation paid out to the employees in the Risk Control and Compliance Function

is decided independent of business parameters.

Other Categories of the Staff:

For the other employees, the Board, based on the recommendation of the NRC may devise appropriate compensation structure. The compensation paid to other employees that include Award Staff, Officers coming under Scale I to IV is fixed based on the periodic industry level settlements with Indian Banks Association. Further the compensation paid to Executives coming under Scale V and above is fixed based on the Executive Compensation Package of the Bank, which is finalised after considering various parameters like industry level/peer group status, burden for the Bank and all other relevant factors. The variable compensation paid to employees is based on the Performance Linked Incentive Scheme, which has been formulated on the basis of performance parameters set in the Performance Management System.

Limit on Variable pay and Deferred Compensation:

As per the compensation policy of the Bank, the compensation structure for the Whole-Time Directors/ Chief Executive Officers/Material Risk Takers (MRTs) of the Bank is divided into Fixed Pay and Perquisites and Variable pay.

Fixed Pay and Perquisites

Based on the recommendations of the Nomination and Remuneration Committee, Board shall fix the fixed portion of compensation payable which is reasonable, taking into account all relevant factors including adherence to statutory requirements and industry practice. In case of MD & CEO and Executive Director, the same is subject to the approval of Reserve Bank of India.

Variable Pay

In order to have a proper balance between the cash and share-linked components in the variable pay, the variable pay is to be structured in the form of share-linked instrument (including Cash-linked Stock Appreciation Rights (CSARs)), or a mix of cash and share linked instruments subject to the recommendation of the Nomination and Remuneration Committee of the Board. Only in cases where the compensation by way of share-linked instruments is not permitted by law/ regulations, the entire variable pay can be in cash to be exercised.

The assessment of the variable pay will be based on 'Key Performance Indicators' (KPI) achievement of respective Whole-Time Directors/Chief Executive Officers/Material Risk Takers (MRTs).

Limit on Variable Pay:

A. For Whole-Time Directors and Chief Executive

Officers

i. In compliance to the RBI Guidelines and other applicable rules and regulations at least 50%, should be variable and paid on the basis of individual, business-unit and firm-wide measures that adequately measure performance. The total variable pay shall be limited to a maximum of 300% of the fixed pay (for the relative performance measurement period).

ii. In case variable pay is up to 200% of the fixed pay, a minimum of 50% of the variable pay; and in case variable pay is above 200%, a minimum of 67% of the variable pay should be via non-cash instruments.

iii. In the event that an Executive is barred by Statute or Regulation from grant of share-linked instruments, his/her variable pay will be capped at 150% of the fixed pay, but shall not be less than 50% of the fixed pay.

iv. The deterioration in the financial performance of the bank should generally lead to a contraction in the total amount of variable compensation, which can even be reduced to zero.

B. For Material Risk Takers (MRTs)

i. In compliance to the RBI Guidelines and other applicable rules & regulations, 50% of total pay for all MRTs should be variable pay and paid on the basis of individual, business-unit and firm-wide measures that adequately measure performance.

ii. 50% of the variable pay should be via non-cash instruments.

iii. The deterioration in the financial performance of the Bank should generally lead to a contraction in the total amount of variable compensation, which can even be reduced to zero.

The Board will from time to time specify the Material Risk Takers (MRTs).

a) Deferral of Variable Pay

i. For senior executives, including WTDs, and other employees who are MRTs, a minimum of 60% of the total variable pay must invariably be under deferral arrangements. Further, if cash component is part of variable pay, at least 50% of the cash bonus should also be deferred.

ii. However, in cases where the cash component of variable pay is under Rs25 Lakh, deferral

requirements is not applicable.

b) Period of Deferral Arrangement

The deferral period should be for a period of three years. This would be applicable to both the cash and non-cash components of the variable pay arrangements.

c) Vesting:

Deferred remuneration should be spread out over the course of the deferral period on a pro rata basis as follows:

- not more than 33.33 % of the total deferred variable pay should vest at the end of first year.

- Further, not more than 33.33 % of total deferred variable pay should vest at the end of second year.

Additionally, vesting should not take place more frequently than on a yearly basis to ensure a proper assessment of risks before the application of ex-post adjustments.

In case of employee's death or permanent disability, whole of the deferred variable pay (Cash component) shall immediately vest on the employee's legal heirs, or the employee, as the case maybe.

Share-linked Instruments

Such instruments shall be included as a component of variable pay. Norms for grant of share-linked instruments should be framed by Banks in conformity with relevant statutory provisions and should form part of the Bank's compensation policy. The details of share- linked instruments granted should also be disclosed in terms of the disclosure requirements stipulated in these Guidelines. Share-linked instruments should be fair valued on the date of grant by the Bank using Black- Scholes model in compliance with the RBI guidelines. The fair value thus arrived at shall be recognised as an expense beginning with the accounting period for which approval has been granted.

The Variable pay assessment should consider the following parameters

- The HR Department in consultation with CFM Department has to recommend that amount of Variable pool of the Bank each year to the Nomination and Remuneration Committee.

- While recommending the variable Pool HR Department should establish the linkage between the

variable pool at the Bank level and the performance of the Bank vis-a-vis its financials and risk assumed.

- Further HR Department should also detail the linkage between performance of various units/functions/ divisions to performance of variable pool.

- There should be a prudent basis for distribution of the overall variable pool between various units/ functions/divisions including various control and assurance functions.

- Performance thresholds as defined and assessed by HR Department to be attained for being eligible for variable compensation.

The same to be included and form part of the Performance Linked Incentive Scheme.

Malus / Clawback

The deferred compensation should be subject to malus/ clawback arrangements in the event of subdued or negative financial performance of the Bank and/or the relevant line of business in any year.

The Bank has identified a set of situations which require the invocation of the malus and clawback clauses that may be applicable as detailed below:

i. Applying of Malus/Clawback arrangement on

entire variable pay on occurrence of the following situations:

- Identified fraud/misconduct by the Executive

(Whole-Time Directors, Chief Executive Officers/ Material Risk Takers (MRTs)) pertaining to the corresponding period for which the clause to be applied.

ii. Applying of Malus/Clawback arrangement on

unvested portion of deferred variable pay on

occurrence of the following situation:

- Reporting of operating loss or more than 50% fall in operating profit in any year.

iii. Applying of Malus clause on unvested portion of deferred variable pay on occurrence of the following situation:

- Wherever the assessed divergence in Bank's provisioning for Non-Performing Assets (NPAs) or asset classification exceeds the prescribed threshold for public disclosure as detailed below: (As referred in RBI circular No. DBR.BP.BC. No.32/21.04.018/2018-19 dated April 1, 2019 and in terms of Reserve Bank of India (Commercial Banks: Financial Statements - Presentation and Disclosures) Directions, 2025 as amended from time to time),

a) the additional provisioning for NPAs assessed by RBI as part of its supervisory process, exceeds five per cent of the reported profit before provisions and contingencies for the reference period, and

b) the additional Gross NPAs identified by the RBI as part of its supervisory process exceed five per cent of the reported incremental Gross NPAs for the reference period.

Further, in such situations, no proposal for increase in variable pay (for the assessment year) shall be entertained. In case the Bank's post assessment Gross NPAs are less than 2.0%, these restrictions will apply only if criteria for public disclosure are triggered either on account of divergence in provisioning (clause (a)) or both provisioning (clause (a) and asset classification (clause (b)).

Any other act detrimental to the interest of the Bank including and not restricted to violation of Code of Conduct, violation of Framework for dealing with Conflict of Interest, violation of rules and regulations of the Bank, failure to discharge fiduciary and regulatory duties and in respect of which the Bank would reserve the right to institute appropriate civil, criminal or other proceedings at the risks, costs and consequences of such individuals.

As part of the criteria for the application of malus and clawback, the following period during which malus and/ or clawback can be applied will be 36 months from application of the clause. Covering at least deferral and retention periods (a period of time after the vesting of instruments which have been awarded as variable pay during which they cannot be sold or accessed).

In case, the MRT(s) resigns, retires or takes early retirement or has been terminated, the above provisions of clawback shall apply subject to due process for recovery of amounts adjudged.

Guaranteed Bonus

Guaranteed bonus is not consistent with sound risk management or the 'pay for performance' principles and should not be part of the compensation plan. Therefore, guaranteed bonus should only occur in the context of hiring new staff as joining/sign-on bonus and be limited to the first year. Such bonus will neither be considered part of fixed pay nor part of variable pay. Further, Banks will not grant severance pay other than accrued benefits (gratuity, pension, etc.) except in cases where it is mandatory under any statute.

Hedging

The Bank will not provide any facility or funds or permit

employees to insure or hedge their compensation structure to offset the risk alignment effects embedded in their compensation arrangement. To enforce the same, the Bank will establish appropriate compliance.

The compensation structure for the Non-Executive Part-Time Chairman

The Nomination and Remuneration Committee after taking into account all relevant factors such as, performance, ability and experience of the individual, recommend to the Board to fix the compensation structure in compliance with the provisions of Companies Act, 20l3, Banking Regulation Act,1949, SEBI(LODR)/Listing Regulations and other regulatory guidelines, as amended from time to time.

The remuneration payable to the Chairman is subject to prior approval of the Reserve Bank of India (RBI). Therefore, the remuneration or any revision in remuneration of the Chairman is payable only after receipt of the approval from RBI.

Remuneration of Non-Executive Directors (NEDs):

The independence of Bank's Non-Executive Directors is critical for the proper functioning of the Bank's governance framework. By compensating these Directors appropriately, Bank can reinforce their independence from management and other vested interests, allowing them to make decisions that are in the best interest of the Bank and its shareholders.

The Reserve Bank of India has issued guidelines, on the need of Banks to attract qualified competent individuals and retain professional expertise in their Boards, keeping in view of individual director's (NEDs) responsibilities, contribution of their time, vide RBI Circular No. DBR.No.BC.97/29.67. 001/2014-15 dated June 1, 2015, on payment of Compensation to NonExecutive Directors (other than the Part-time Chairman) in the form of profit related commission which shall not exceed Rs10 Lakh per annum for each Director subject to the bank making profits. Further as per revised Circular No. RBI/2021-22/24 DOR.GOV.REC.8 /29.67.001/2021- 22 dated April 26, 2021, RBI has revised the fixed remuneration for a NED, other than the Chair of the Board, not exceeding Rs20 lakh per annum. Further RBI vide circular number RBI/2023-24/121 DoR.HGG.GOV. REC.75/29.67.001/2023-24 dated February 9, 2024, has increased the ceiling of the fixed remuneration for a NED, other than the Chair of the Board, to Rs30 lakh per annum.

The Bank should obtain shareholder approval to fix maximum Fixed Remuneration limit and also obtain shareholder approval as and when there is a change in maximum Fixed Remuneration limit payable to NonExecutive Directors/Independent Directors of the Bank

(other than Part Time Chairman), in line with regulatory guidelines, as amended.

The compensation by way of Fixed Remuneration to all Non-Executive Directors/Independent Directors (Other than Non-Executive (Part-time) Chairman), shall not exceed Rs20,00,000/- (Rupees Twenty Lakhs only) per Director per annum, in addition to sitting fees and reimbursement of expenses for attending the meetings of the Board of Directors and/or other meetings, as approved by the Shareholders at the 95 th Annual General Meeting held on 24 th August, 2023.

The compensation to be based on profitability at the end of each Financial Year, as may be approved by the Board of Directors from time to time.

The Board may every year approve the Fixed Remuneration up to Rs20,00,000/- (Rupees Twenty Lakh Only) per annum per Director to each of the NonExecutive Directors/ Independent Directors of the Bank (other than Part Time Chairman), for each year on a proportionate basis of his office of directorship in the respective Financial Year as per the limit approved by the Shareholders at the 95 th Annual General Meeting held on 24 th August, 2023.

The Nomination and Remuneration Committee after taking into account all relevant factors such as ability of Bank and experience of the individuals, recommend to the Board to pay compensation to Non-Executive Directors / Independent Directors (other than NonExecutive (Part Time) Chairman), in compliance with the provisions of Companies Act, 2013, Banking Regulation Act, 1949, Listing Regulations and other regulatory guidelines, as amended from time to time.

The Non-Executive Directors are also paid sitting fees for attending each meeting of the Board of Directors or any committees of the Board and their expenses for attending such meetings shall be reimbursed in compliance with the provisions of the Companies Act, 2013, Listing Regulations and other regulatory guidelines, as amended from time to time.

The Board while recommending any change in the remuneration or sitting fees will considers various factors like size and complexity of organisation, comparison with the peer Banks and Regulatory guidelines as applicable.

Policy on Board Diversity :

Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to ensure compliance with the applicable provisions, the Bank has devised a policy on Board Diversity to ensure adequate diversity in its Board of Directors. The Bank believes that diversity underpins the successful operation of an

effective Board and embraces diversity as a means of enhancing the business. With a view to achieve sustainable and balanced development, the Bank sees increasing diversity at the Board level as an essential element in supporting the attainment of its strategic objectives. A diverse Board includes and makes good use of differences in the skills, regional and industry experience, background, race, gender and other qualities of Directors.

Policy on Board Diversity of the Bank mainly depends on the qualifications for appointment of Directors of the Bank as contained in the Banking Regulation Act,1949 and satisfying the Fit and Proper Criteria for Directors as per the regulatory requirement of RBI.

The Bank continuously seeks to enhance the effectiveness of its Board and to maintain the highest standards of corporate governance and recognizes and embraces the benefits of diversity in the Board room. Diversity is ensured through consideration of various factors, including but not limited to skills, regional and industry experience, background and other qualities. In formulating its perspective on diversity, the Bank also considers factors based on its own business model and specific needs from time to time.

The NRC has the responsibility to lead the process for Board appointments and for identifying and nominating, candidates for appointment to the Board. The benefits of diversity continue to influence succession planning and continue to be the key criteria for the search and nomination of Directors to the Board.

The Board appointments are based on merit and candidates will be considered against objective criteria, having due regard for the benefits of diversity on the Board, including gender. The policy of Board Diversity is displayed on Bank's website:

Familiarization Programme

The Bank had conducted various sessions during the financial year to familiarize the Independent Directors of the Bank, including various topics on Banking Industry, Business Model, Corporate Law, Risk Management System and Cyber Security. Further, the Directors are encouraged to attend the training programmes being organized by various Regulators/ bodies/institutions on the above matters. The details of such familiarization programmes are displayed on the website of the Bank.

Board Level Performance Evaluation

The Companies Act, 2013 and SEBI (LODR) Regulations,

2015 stipulates the performance evaluation of the Directors, MD & CEO, Chairman, Board and its Committees. Considering the said provisions, the Bank has devised the process and the criteria for performance evaluation which have been recommended by the Nomination & Remuneration committee and approved by the Board. The process for formal annual performance evaluation is as under:

- Committee of Independent Directors at their separate meeting evaluates the performance of Non- Independent Directors, MD & CEO, Executive Director, Chairman of the Bank and the Board as a whole.

- The Board evaluates the performance of the Independent Directors, Non-Executive Directors, Chairman of the Bank, Executive Director and MD & CEO (excluding the Director being evaluated) and submit its report to the Nomination & Remuneration committee.

- The Board and Nomination & Remuneration Committee evaluates the fulfilment of the independence criteria as specified in the regulations and their independence from the Management.

- The Board evaluates the performance of Board as a whole and for Board level committees.

- Nomination & Remuneration Committee evaluates/ reviews the performance of each Director and recommends the appointment/re-appointment/ continuation of Directors to the Board. Based on the recommendation of Nomination & Remuneration Committee, Board will take appropriate action.

The criteria for performance evaluation, inter-alia, include the following:

Performance Evaluation of Non-Executive Directors, MD & CEO, Executive Director and Chairman

Participation at Board/Committee Meetings, Managing Relationship, Knowledge and Skill, Personal Attributes, Compliance and Corporate Governance; Leadership; Strategy Formulation, Strategy Execution, Financial Planning/ Performance, Relationships with the Board, Human Resource Management and Succession Planning, Personal Qualities, Financial Parameters, Credit Quality and Risk Management, Customer Acquisition & Retention, Expansion of Loan Portfolio, Resources and Conduct of Meetings.

Performance Evaluation of Board

Composition and Diversity, Strategic Foresight, Value Creation, Process and Procedures, Oversight of the Financial Reporting Process and Internal Controls, Oversight of Audit Functions, Corporate Governance,

Corporate Culture, Monitoring of Business Activities, Understanding of the business of the Bank and Regulatory Environment, Contribution to Effective Corporate Governance and Transparency in the Company's Operations, Deliberations/ decisions on the Company's strategies, policies, plans and guidance to the Executive Management.

Performance Evaluation of the Board Level Committees

The performance and effectiveness of the Committee; Frequency and duration; Spread of talent and diversity in the Committee; Understanding of regulatory environment and developments; Interaction with the Board.

Outcome of Performance Evaluation

An annual performance evaluation of the Board, Committees of the Board and the individual members of the Board was conducted in June 2025 as per the aforesaid process and the report on the evaluation were presented at the meeting of the NRC and the Board of Directors. The Directors expressed their satisfaction with the evaluation process. The feedback of the Board, post completion of the exercise of performance evaluation of the Board and Committees of the Board were as under:

- Continued efforts and actions are required for growth and margins in Retail/ MSME Sectors, unsecured loans and deposit mobilization to reduce excessive reliance on Corporate, Treasury and other income.

- W.r.t. SIB @ 100, Management has prepared a preliminary document for SIB @ 100 and the same should be shared with the directors at the earliest. Based on initial information, more work is required in this area.

- There should be rationalization of HO / RO / Cluster business reviews so that branches can focus more on business development. Such reviews should be conducted on specified day & time, preferably after business hours.

- AI / DPDP / ECL will require focus next year from regulatory perspective.

EMPLOYEE STOCK OPTION SCHEME

The SIB ESOS 2008 Employee Stock Option Scheme ('the Scheme') provides for grant of stock options on equity shares of the Bank to employees and Managing Director & CEO and Whole-Time Director(s) of the Bank. The Scheme is in compliance with Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. The Bank followed Black-Scholes model for calculating fair value of options

to account for its stock-based employee compensation plans as per the Guidelines for all the options granted during the Financial Year ended March 31, 2026. The fair value thus arrived was being recognised as expense beginning with the accounting period for which approval has been granted as per RBI circular No. RBI/2021- 22/95 DOR.GOV. REC.44/29.67.001/2021-22 dated August 30, 2021. Till March 2026, 6,37,05,722 stock options were vested, out of which 3,05,90,831 stock options were exercised by eligible employees. The money realised due to exercise of the said options was Rs45,73,47,682.39 and consequently 3,05,90,831 shares of Rs1/- each have been allotted to the employees/ legal heirs concerned.

A Certificate of the Secretarial Auditors pursuant to Regulation 13 of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 will be placed to the AGM for the scrutiny of Shareholders. The total options granted under twenty phases of SIB ESOS 2008 works out to 3.02% of the paid-up share capital of the Bank as at March 31, 2026. The Scheme has generated the intended motivation amongst the staff. The Employee Stock Option Scheme (SIB ESOS 2008) is modified latest by shareholders at 97 th Annual General meeting dated August 20, 2025. The modification to the ESOS Scheme is intended solely to make the provisions of the Scheme more specific and to explicitly cover the scope of provisions permitted under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and to refer to the provisions of latest statutes. The changes were clarificatory in nature and aim to enhance regulatory alignment, without altering the intent, structure, or key terms of the Scheme and the scheme is in compliance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.Statutory disclosures regarding details of the stock options granted, vested, exercised, forfeited and expired during the year under review is hosted on the website of the Bank and can be viewed at

AUDITORS

a) Statutory Auditors:

The shareholders at its 96 th Annual General Meeting held on August 27, 2024 has appointed M/s. M. P. Chitale & Co, Chartered Accountants, Mumbai (Firm Registration Number 101851W) and at its 97 th Annual General Meeting held on August 20, 2025 has appointed M/s. Borkar & Muzumdar, Chartered Accountants, Mumbai (Firm Registration Number 101569W) as the Joint Central Statutory Auditors of the Bank for a continuous period of 3 years respectively. Accordingly, the appointment of M/s M.

P. Chitale & Co, Chartered Accountants will be until the conclusion of the 99 th Annual General Meeting and appointment of M/s. Borkar & Muzumdar, Chartered Accountants will be until the conclusion of the 100 th Annual General Meeting of the Bank.

For the year ended March 31, 2026, fees paid/ payable to the Joint Statutory Central Auditors M/s M. P. Chitale & Co, Chartered Accountants and M/s. Borkar & Muzumdar, Chartered Accountants are as follows:

(Rs in lakh)

# Excluding out of pocket expenses

There is no qualification or adverse remark in Auditors' Report. There is no incident of fraud requiring reporting by the Auditors under Section 143(12) of the Companies Act, 2013.

The Reserve Bank of India vide. Letter No CO.DOS. RPD.No.S2071/08.21.005/2026-27 dated June 17, 2026 has approved to continue with the appointment of M/s. M P Chitale & Co., Chartered Accountants (Firm Registration Number : 101851W) and M/s. Borkar & Muzumdar Chartered Accountants (Firm Registration Number: 101569W) as the Joint Statutory Auditors of the Bank for the FY 2026-27, for their third year and second year respectively.

An item for fixing the remuneration payable to Joint Statutory Auditors is placed for the approval of the Shareholders in the ensuing Annual General Meeting.

b) Secretarial Auditors and Secretarial Audit Report:

Pursuant to Section 204 of the Companies Act, 2013, and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "SEBI Listing Regulations") read with SEBI circular no. SEBI/HO/CFD/ CFD-PoD-2/CIR/P/2024/185 dated 31 st December 2024, the Bank had appointed M/s SVJS & Associates, Practicing Company Secretaries, Kochi (Firm Registration No. P2008KE17900) and holding a valid peer review certificate (Certificate No. 6215/2024) issued by the Institute of Company Secretaries of India (the "ICSI"), as its Secretarial Auditors to conduct the secretarial audit of the Bank for a period of five (5) years, commencing from

Financial Year 2025-26 till Financial Year 2029-2030. The Bank has provided all assistance and facilities to the Secretarial Auditor for conducting their audit. The Report of Secretarial Auditor for the FY 2025-26 is annexed to this report as Annexure C. There are no reservations, adverse remark or disclaimer in the Secretarial Audit Report. No offence of fraud was reported by the Secretarial Auditor of the Bank.

Pursuant to circular no. CIR/CFD/CMD1/27/2019 dated February 08, 2019, issued by SEBI and Regulation 24A of the SEBI (LODR) Regulations, 2015, the Bank has obtained Secretarial Compliance Report from Practicing Company Secretaries on compliance of all applicable SEBI Regulations and circulars/ guidelines issued thereunder and the copy of the Secretarial Compliance Report was submitted with the Stock Exchanges.

INTERNAL CONTROL AND AUDIT/INSPECTION

Internal Control and their Adequacy

The Bank has put in place extensive internal controls and processes to mitigate operational risks, which includes maker checker authentication of CBS transactions, centralized processing of opening and modifications of CASA accounts and loan accounts, centralized sanctioning of loan facilities etc.

Various Preventive controls viz., Dual custody for cash, gold and other security items, maintenance of daily control registers for security items, finger-scan- authentication for processing of transactions in CBS in addition to login passwords, stringent guidelines on password usage, STP processes between CBS and payment interface systems for transmission of messages etc. are in place.

In addition to that the transactions generated in the CBS are monitored by the Fraud Risk Management (FRM) CBS by the way of alert generated in a near real time basis and the transactions happening through various digital channels are being monitored centrally on a 24x7 basis by Fraud Risk Management (FRM) Cell, for real time detection and prevention of frauds.

As per the requirement of Companies Act, 2013, the Bank has formulated an Internal Financial Controls framework. Risk and Controls associated with each process in the Bank are documented under the Internal Financial Controls Framework. The Inspection and Vigilance Department plays a significant role in testing the control effectiveness for each process under the framework.

Internal audit function provides vital assurance to a Bank's Board of Directors, Senior Management and the Regulator as to the quality of the Bank's internal control

system. The scope of internal audit activities includes the examination and evaluation of the effectiveness of internal control, risk management and governance systems and processes of the Bank and monitoring of compliance with laws and regulations. The inspection/ audit brings out the irregularities/deficiencies in the working of branches/offices and enables the Bank to take corrective action.

Audit/Inspection

The Primary focus of Internal Audit is to provide reasonable assurance to the Board and Top Management about the adequacy and effectiveness of the risk management and control framework in the Bank's operations. The Department is manned by appropriately qualified personnel to handle the Risk Based Internal Audit, Management Audits, Credit Audits including Centralized Credit Audits, Information Systems Audit and Special Audits including Investigations. All the internal audits are conducted based on the RBI guidance note in relation to conducting risk based internal audit and RBI circular on concurrent audit of branches and identified critical processes of the branches.

In respect of matters relating to Inspection & Vigilance Department, Head of Internal Audit and Chief of Internal Vigilance (HIA & CIV) directly reports to MD & CEO.

All activities (including outsourced activities) of the Bank and its wholly owned non-financial subsidiary, M/s. SIB Operations and Services Limited (SIBOSL), whose main objective is to provide manpower supply to Bank, fall within the ambit of Internal Audit.

Audit of Branches

All the branches are subjected to Risk Based Internal Audit (RBIA). This audit is conducted at periodic intervals based on the risk perception. All the audits are conducted based on pre-defined check points and all the operational areas are covered under this audit. Credit audit/ Centralized Credit Audit (CCA) is also conducted as part of Risk Based Internal Audit where aggregate credit exposure of a borrower is Rs5 crores and above.

In addition to RBIA of branches, the Bank has a concurrent audit system, which covers selected Branches, conducted by qualified Chartered Accountants/ Firms/retired officers. The selection of branches for concurrent audit is done in such a way that it covers branches having substantial advance or deposit, entire specialized Branches such as 'B' Category Branches, Corporate Branches etc., and all poorly rated branches as per the latest rating awarded.

In addition to the risk based internal audits and concurrent audits, the branches are subjected to

EXPERIENCE NEXT-GEN BANKING

Surprise Inspection, IS Audit, Revenue Audit, Self-Audit, Gold Loan Inspection/Asset Verification, Surprise Gold Loan Inspection/ Asset Verification and Compliance Inspection during the financial year.

Separate monitoring team - Inspection Monitoring Group (IMG) closely monitors various inspections/ audits at the Branches. There are four IMGs who are reporting to the Head of IMG. These Monitoring groups are assigned the task of ensuring the compliance and closure of the inspection report of the branches. During the course of inspections, serious irregularities if any, concerning regulatory guidelines, legal requirements and operational processes are found, these are escalated to the Management for timely action.

All the branch-related audits are presently automated through system where reporting, risk rating, compliance and closure of the reports are done through software application which provides the Bank with an overall control on various audits conducted in the branches. Continuous improvements are made to the application to automate several activities at HO and digitize the records in a single application.

Internal inspectors conduct inspection at regular intervals based on the risk rating and the inspection reports are placed to Audit Committee at Executive level (Sub Committee of Audit Committee of Executives (SACE)/Audit Committee of Executives - (ACE)) for review, which is overseen and controlled by Board Level committee (Audit Committee of Board - ACB).

Audit of Departments and critical process

Management Audit involves the review of managerial aspects like organizational objective, policies, procedures, structure, control and system to check the efficiency and performance of the management over the activities of the Bank.

Further to the traditional audits, the department introduced Thematic Audits to assess the risks and evaluate the controls across the selected areas/ activities/sub-activities to verify whether the process is effective, controlled and compliant with regulatory and internal guidelines. The Audit aims to ensure that management is made aware of the status and can initiate appropriate steps for correction and remediation.

The Management Audit is conducted at periodical intervals based on the risk perception of respective Department/ Business Vertical/ Regional Offices. In addition to the management audit conducted by Inspection Department, all the critical operations such as International Banking Division, Treasury Department, Credit Department and Centralized Processing Centers, etc., are subjected to concurrent audit by Independent

All these reports are reviewed by Audit Committee of Executives (ACE/SACE) and Audit Committee of Board (ACB) and corrective steps are taken to rectify the lapses/ irregularities, if any, pointed out in such inspection reports as recommended by vetting department.

There is a team available within the Inspection Department exclusively for conducting audit of IT systems and applications. Various IS audits and Vulnerability Assessment & Penetration Testing (VAPT) are conducted in a stipulated frequencies as per approved audit plan. Guidelines from regulators like RBI, Cert In, NPCI, UIDAI, SEBI, etc. related to IT security are incorporated in the periodic IS audits. Any new software application or modification in the existing application undergoes a thorough audit with respect to IT controls before going live.

New product/process whenever introduced in the Bank is reviewed by Inspection Department and recommendations are made for necessary controls/ improvements for deficiencies / gaps observed in existing internal controls.

Inspection Division also carries out independent evaluation of Bank's Internal Financial Controls in terms of Companies Act, 2013 and also the adequacy of Internal Financial Controls with reference to the Financial Statements.

EXPLANATION FOR AUDITOR'S COMMENT IN THE REPORT

The Joint Statutory Auditor's Report for the year 202526 does not contain any qualification.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 8 of Companies (Accounts) Rules, 2014 and other applicable provisions of the Banking Regulation Act,1949, the Bank has prepared its Consolidated Financial Statement including its Wholly Owned Subsidiary Company M/s. SIB Operations and Services Limited, which is forming part of this Annual Report. The financial position and performance of its Subsidiary Company is given in Form AOC-1, the statement containing salient features of the financial statements of the Subsidiary Company.

In accordance with third proviso to Section 136(1) of the Companies Act, 2013, the Annual Report of the Bank, containing therein its Standalone and the Consolidated Financial Statements has been hosted on its website ( ). Further, as per fourth proviso to the said Section, the Audited Annual Accounts of the said Subsidiary Company of the Bank, considered as part of the Consolidated Financial Statements

have also been hosted on the Bank's website (www. southindianbank.bank.in). The said documents have been hosted on the website of the Subsidiary Company of the Bank also, in compliance with the said Section. The documents/details available on the Bank's website ( ) will also be available for inspection by any Member at its Registered Office. Further, pursuant to the provisions of Accounting Standard ('AS') 21, Consolidated Financial Statements notified under Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 issued by the Ministry of Corporate Affairs, the Consolidated Financial Statements of the Bank along with its Subsidiary Company for the year ended March 31, 2026 forms part of the Annual Report.

CORPORATE GOVERNANCE

A separate report detailing Corporate Governance as required under applicable regulations of the SEBI (LODR) Regulations, 2015 and a certificate from M/s. SVJS & Associates Company Secretaries, Secretarial Auditors of the Bank, are annexed to this Report.

Annual Return

Pursuant to sub-section 3(a) of Section 134 and sub section (3) of Section 92 of the Companies Act, 2013, read with Rule 11 and 12 of the Companies (Management and Administration) Rules, 2014, copy of Annual Return as at March 31, 2026 in Form No. MGT-7 is hosted on the website of the Bank and can be viewed at

Statement of deviation or variation

Pursuant to Regulation 32 and other relevant provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Master Circular No. SEBI/HO/CFD/PoD2/CIR/P/2023/12 dated July 11, 2023 issued by SEBI, the statement of deviation/ variation in the use of proceeds for the quarter ended on March 31, 2024, of issue of shares on a rights basis at a ratio of 1:4 and issued 52,31,85,254 (Fifty Two Crores Thirty One Lakhs Eighty five thousand two hundred and fifty four) shares of face value of Rs1.00 (Rupee One) each ("Shares") at an issue price of Rs22 (Rupees Twenty Two only) aggregating to Rs1,151.01 Crore (Rupees One thousand One Hundred Fifty One Crore and One Lakh) made by the Bank is Nil. The same has been reviewed by the Audit Committee of the Board and submitted to the Stock Exchanges on May 2, 2024. As the Bank has not raised any fund during the Financial Year 2025-26, No Statement of deviation or variation were filed Pursuant to Regulation 32, 52 and other relevant provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for FY 2025-26.

Environmental, Social and Governance

Environmental, Social and Governance (ESG) matters have become increasingly relevant for companies across the Globe. Being in the financial sector, the Bank has focused on promotion of sustainable and environmentally friendly assets by identifying and recognising ESG risks viz-a-viz opportunities.

As part of developing a sustainable financing policy and for implementing ESG benchmarks in lending and also for addressing issues in Environmental risk management and governance, the Bank has formulated ESMS policy (for governing Lending standards), Green Deposit Policy and Green Financing Framework (to promote investments in green projects and activities that contribute to sustainable development) and ESG Policy (for addressing other ESG issues). The Bank has taken following steps in this regard.

- Corporate Social Responsibility Committee of the Board is made responsible for overseeing the Environmental, Social and Governance (Reporting & review) activities of the Bank under the ESG framework.

- MD & CEO has been authorized as the designated Director for implementing ESG in the Bank for BRSR reporting.

- The Board has constituted an Executive Level Committee for implementing the ESG initiatives of the Bank. Executive Level Committee will be responsible for supervision and implementation of ESG activities in the Bank.

- For effective Reporting of BRSR and to review the ESG practices at the Bank, the Bank had also appointed a Professional agency for assisting Business Responsibility and Sustainability Reporting.

- Environmental and Social Management System (ESMS) Policy reflects Bank's commitment for integrating environmental and social considerations into the business practices and decision-making processes. The Bank employs a robust grading model to assess environmental and social risks, with emphasis on climate risk for high-value credit, in accordance with the thresholds prescribed by ESMS Policy.

- The Bank collaborated with The New Indian Express, in June 2025 to distribute seed packets to Kerala Edition newspaper consumers, encouraging them to plant hope and nurture a greener tomorrow under the theme 'Tiny Seeds, Big Impact'.

- As part of the Bank's sustained Green Initiative, plants were distributed to retirees and other participants on

the occasion of the Bank's Founder's Day celebration held on 29 th January, 2026. This initiative, which saw the distribution of 300 plants during FY 2025-26, has been institutionalised as an annual programme to promote environmental consciousness among the Bank's extended community.

As part of Environment Day Bank had distributed vegetable saplings to the employees. This promotes green awareness and environmental responsibility among employees.

- To optimise energy consumption and reduce the Bank's overall carbon footprint, a Bank-wide temperature policy has been implemented across all branches, departments, offices and ATMs, mandating the setting of air conditioner units at 24 degrees Celsius. This standardised thermal management policy is expected to yield measurable reductions in electricity consumption across the branch network.

In addition, all new procurement orders for air conditioning equipment are exclusively mandated for inverter-type machines carrying a 5-star energy rating. This procurement policy ensures that future additions to the Bank's fixed assets align with the highest standards of energy efficiency, reducing lifecycle energy costs and environmental impact.

- The Bank's new flagship building, SIB Tower at Kakkanad, Ernakulam, has been constructed with a deliberate focus on sustainability. The external walls of SIB Tower have been built using Porotherm blocks - an eco-friendly walling solution manufactured from natural clay. Porotherm blocks provide superior thermal insulation by significantly reducing heat transfer between the external environment and the interior work areas. This results in reduced dependency on mechanical cooling, lower energy consumption and optimal indoor temperatures, contributing to both occupant comfort and environmental sustainability.

- In a significant milestone for the Bank's renewable energy journey, a 110 KW rooftop solar power plant has been installed and commissioned at SIB Tower, Kakkanad. This installation represents the Bank's concrete commitment to transitioning towards clean energy sources and reducing dependence on conventional grid electricity.

Furthermore, plans are actively underway to extend solar installations to additional Bank-owned premises, with a view to progressively increasing the share of renewable energy in the Bank's total energy consumption. The Bank intends to identify suitable rooftop and ground-mounted solar opportunities at

n select branch locations and administrative buildings

v as part of this phased solar expansion programme.

e , - SIB Tower is equipped with automatic and intelligent e e lighting systems that dynamically minimise power e consumption by regulating light intensity and operational hours based on occupancy and ambient conditions. This smart lighting infrastructure s contributes meaningfully to the building's overall

y energy efficiency profile.

The Bank has also mandated the exclusive use 3 of energy-efficient LED lighting across all Bank-

e owned premises and administrative buildings, to

s the extent possible. This directive, applicable to

, all new installations and replacements, ensures

t that the Bank's lighting infrastructure progressively

l transitions to the most energy-efficient technology

e available, reducing both electricity consumption and

e maintenance costs.

- Recognising the criticality of responsible water

r management, the Bank has taken proactive steps to

i ensure sustainable water treatment across its owned

y properties. A 75 KLD (Kilolitres per Day) Sewage

e Treatment Plant (STP) has been successfully

e installed and commissioned as part of the SIB Tower

g project at Kakkanad, Ernakulam. The treated water is

recycled for non-potable uses within the premises, t including horticulture, thereby contributing to

a t significant conservation of freshwater resources.

s The Bank's strategy envisions the installation of

s sewage treatment facilities across all Bank-owned

buildings, ensuring compliance with environmental r regulations while actively contributing to water

t conservation objectives.

j

- As part of the Bank's social responsibility and

y green initiative to reduce the consumption of tissue

y , paper and other single-use disposable products,

, automatic hand dryers have been installed at the

ITOD Building, Kakkanad, Ernakulam. SIB Tower has similarly been provided with automatic hand dryers e across all restroom facilities.

t , This initiative reflects the Bank's commitment to

s , eliminating avoidable waste at source and fostering

s s a culture of resource consciousness among

n s employees and visitors. The Bank proposes to

n progressively extend this facility to other owned

administrative buildings and major branch premises.

o - SIB Tower, Kakkanad has been integrated with a e centralised Building Management System (BMS)

e y - a technology-driven infrastructure that enables

e y real-time monitoring, control and optimisation of

e t all critical building utilities from a single platform.

The BMS encompasses the management of HVAC

(Heating, Ventilation and Air Conditioning) systems, electrical distribution, lighting controls, fire safety systems and other electro-mechanical assets within the building.

Through automated scheduling, load management and predictive controls, the BMS ensures that energyintensive systems operate only when required and at optimal efficiency levels, significantly reducing wasteful consumption. The system also generates operational data and analytics that enable the Bank's facilities management team to identify inefficiencies, schedule preventive maintenance proactively and make informed decisions on energy usage. The integration of BMS represents a significant step in the Bank's commitment to smart, sustainable building operations and will serve as a model for future Bank-owned infrastructure projects.

- In a commendable initiative towards achieving a circular economy within its premises, SIB Tower is equipped with a food waste management system wherein organic food waste generated within the building is processed through a bio-digester unit. The food waste is mechanically ground and fed into the bio-digester, where it undergoes anaerobic decomposition to produce biogas.

The biogas thus generated can be utilised as a clean fuel source for cooking or other thermal applications within the premises, effectively closing the loop on organic waste and reducing dependency on LPG or other conventional fuel sources. This initiative simultaneously addresses two environmental objectives - diversion of organic waste from landfills and generation of renewable energy from waste - and is aligned with the principles of sustainable resource management and waste minimisation. The Bank intends to replicate this model across other owned administrative buildings as the programme matures.

- Under its Corporate Social Responsibility (CSR) programme, the Bank extends financial assistance for the establishment and installation of solar energy systems, the development of solid waste management infrastructure, afforestation initiatives, deployment of terrain vehicles, and the creation of other infrastructure to promote sustainable ecotourism and environmental conservation.

- DHL GoGreen Initiative - Advancing Sustainability Together: As part of our unwavering commitment to sustainability and environmental stewardship, South Indian Bank has partnered with DHL Express under the GoGreen Plus initiative. This alliance signifies a proactive step towards reducing our carbon

footprint across logistics operations and reinforces our dedication to responsible corporate practices. Through our partnership with DHL, South Indian Bank continues to pioneer sustainable banking practices, not just in financial services but also in operational logistics. The GoGreen initiative is a reflection of our long-term vision to embed climate consciousness into every aspect of our ecosystem.

- During the year, the Human Resources Department broadened the Bank's sustainability curriculum:

> Course rollout: Thirty-seven new e-learning courses (aggregating 106 credit hours) were released on the iLearn platform, which include courses devoted to Human Rights, ESG-aligned investing and Green Finance.

> Participation and reach :

During FY 2025-26, a total of 8,877 staff members underwent various internal/external training sessions, both in-person/online. 8,968 staff members successfully completed courses on the learning platform amounting to a total of 4,93,404 learning hours.

> ESG-Aligned Learning Framework : The

updated curriculum now includes Environmental Economics, Climate Risk Disclosure & Sustainable Banking, ESG & Climate Risk etc

> Forward commitment : The Bank has set a target of extending ESG and related foundational training to 100 % of employees in the coming cycle.

- The Bank has committed to promote sustainable finance and environmental stewardship. One of the ways we demonstrate this commitment is through the green deposit product. Green deposits are a unique financial product that allows customers to align their savings with environmentally responsible initiatives. The objective of the Green Deposit is to promote environment-friendly initiatives by encouraging depositors to invest in green projects and activities that contribute to sustainable development. It aims to mobilize deposits and use the proceeds for funding projects and activities that promote environmental conservation, renewable energy, energy efficiency and other green initiatives.

Green Deposit Policy & Green Financing Framework

Green Deposit Policy & Green Financing Framework: In line with our commitment to sustainability, the Board of the Bank has approved the "Green Deposit Policy and Green Financing Framework," which introduces a pioneering financial product known as the "Green

Deposit." This product enables depositors to contribute to sustainability objectives by channelling surplus funds into environmentally beneficial projects, following the RBI guidelines issued on April 11, 2023. The funds raised through Green Deposits are dedicated to supporting green financing activities. These activities aim to foster initiatives that have positive environmental impacts, including renewable energy, energy efficiency, sustainable agriculture, and other eco-friendly ventures. The Green Deposit scheme has successfully raised Rs97.66 crore during FY2025-26. In addition, an unutilized balance of Rs58.62 crores from FY 2024-25, which was previously kept in liquid instruments, was also available for allocation. During FY2025-26, a total of Rs156.28 crore (including Rs58.62 crores from the previous year) was allocated to permissible green activities and projects. The Bank acknowledges its pivotal role in addressing sustainability challenges and is committed to facilitating the transition to a low-carbon economy. Through the provision of a diverse range of sustainable financing products and services to customers, the Bank aims to drive sustainable development and contribute to a greener future.

Portfolio-level information on the use of funds raised from green deposits (Rs. In Crore]

*Includes green finance allocation of Rs 58.62 crs pertaining to FY 2025.

$ The figures reported above correspond to the period from 01.06.2023 to 31.03.2026.

Business Responsibility and Sustainability Reporting (BRSR)

As stipulated in Listing Regulations, the Business Responsibility and Sustainability Report describing the initiatives taken by the Bank from Environmental, Social and Governance perspective is attached as part of the Directors' Report as Annexure-D.

Dividend Distribution Policy

In accordance with the Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Bank has formulated a Dividend Distribution Policy and the Policy is hosted on the website of the Bank and can be viewed at

Subsidiary Companies/Joint Ventures or Associate Companies

As on March 31, 2026, the Bank has one unlisted Wholly Owned Subsidiary - M/s. SIB Operations and Services Limited, which was incorporated on 28 th May, 2021, M/s SIB Operations and Services Limited is a wholly owned Non-Financial Subsidiary Company of the South Indian Bank Ltd. The RBI has accorded the final approval on March 25, 2021 for setting up the Subsidiary Company and the Company was incorporated on May 28, 2021 to cater to the operational needs of the South Indian Bank Ltd. Its authorized Capital as on March 31, 2026 is Rs2 crores and the Issued and Paid-up Capital is Rs50 lakh. The company is providing exclusive services to the Bank in the operational areas of Tele calling, Business Development, Data Entry Operations, I.T. Support and other services permitted by Reserve Bank of India. The Subsidiary Company has reported a profit of Rs50.16 lakhs as on March 31, 2026.

There are no companies which have ceased to be Bank's Subsidiaries, Joint Ventures or Associate Companies during the Financial Year 2025-26.

Sri. M George Korah (DIN: 08207827), Non-Executive Independent Director of the Bank, Sri. P R Seshadri (DIN: 07820690), MD & CEO of the Bank, Sri. Benny P Thomas (DIN: 09448424), Non-Executive NonIndependent Director of the Bank and Sri. Anto George T (DIN: 10702382), Chief Operating Officer of the Bank were Directors of SIB Operations and Services Limited as on March 31, 2026.

Except Sri. M George Korah (DIN: 08207827) and Sri. Benny P Thomas (DIN: 09448424), no other Directors in the Board of SIB Operations and Services Limited were drawing any sitting fee from the subsidiary company. Sri. M George Korah (DIN: 08207827) and Sri. Benny P Thomas (DIN: 09448424), have received Rs1,60,000/-

g and Rs1,60,000/- each as sitting fee for attending the

Board Meetings of the subsidiary company during the

Financial Year 2025-26. s

e The Board of Directors has formulated a policy for al determining 'material' subsidiaries pursuant to the e provisions of the Listing Regulations, though the Bank has no material subsidiary. The same is displayed on the website of the Bank s

d Related Party Transactions

k

e The Board of Directors has formulated a Policy on e Materiality of Related Party Transactions and also on

- dealing with Related Party Transactions pursuant to the provisions of the Companies Act, 2013 and SEBI

e (LODR) Regulations, 2015. The same is displayed on the website of the Bank. y s

Since the related party transactions are in the ordinary d course of business and on an arm's length basis and not n material, as per Section 188 of Companies Act, 2013, a Nil AOC-2 is disclosed in compliance with Section

n

134(3)(h) of Companies Act, 2013 and Rule 8(2) of the o y Companies (Accounts) Rules, 2014 as Annexure-E.

k Material Changes and Commitment Affecting 2 Financial Position of the Bank

e . There are no material changes and commitments, e s affecting the financial position of the Bank which has d s occurred between the end of the financial year of the d e Bank i.e. March 31, 2026 and the date of the Directors' 6 report i.e. July 16, 2026.

Significant and material orders passed by Regulators

s During the year under review, there are no significant

s and material orders passed by the Regulators or Courts

or Tribunals impacting the going concern status and

Bank's operations in future. e

ri Maintenance of Cost Records

y

- Being a Banking Company, the Bank is not required to e maintain cost records as per sub-section (1) of Section k 148 of the Companies Act, 2013.

d Details in respect of frauds reported by auditors

There is no fraud reported by auditors under subsection i. (12) of section 143 of the Companies Act, 2013 which n are reportable to the Central Government. e

. Compliance to Secretarial Standards

P The relevant Secretarial Standards issued by the

- Institute of Company Secretaries of India (ICSI) related

to the Board Meetings and General Meeting have been complied with by the Bank.

Strictures and Penalties

During the last three financial years, there were no penalties or strictures imposed on the Bank by the SEBI or any of the stock exchanges and/or any other statutory authorities on matters relating to capital market.

Deposits

Being a Banking Company, the disclosures required as per Rule 8(5) (v) & (vi) of the Companies (Accounts) Rules, 2014, read with Section 73 and 74 of the Companies Act, 2013 are not applicable to the Bank.

THE DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016)

As per section 3(7) of The Insolvency and Bankruptcy Code, 2016, Corporate person does not include any financial service provider, thereby the Bank is excluded from the purview of the Code. There have been several applications made or are pending in the name of the Bank as a Financial creditor against any default occurred as part of the course of business. The Details of applications made by the Bank during FY 2025-26 and cases which are pending as on 31.03.2026 where applications are made by the Bank as a Financial Creditor against default occurred as part of the course of business are as follows:

Management Discussion and Analysis Report

This has been dealt with in a separate section in the Annual Report.

Particulars of Loans, Guarantees or Investments

Pursuant to Section 186 (11) of the Companies Act, 2013, the provisions of section 186 of Companies Act, 2013, except subsection (1), do not apply to a loan made, guarantee given or security provided or investment

made by a banking company in the ordinary course of business.

Directors' Responsibility statement

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013, with respect to the Director's Responsibility Statement, it is hereby confirmed that:

a. in the preparation of the annual accounts for the Financial Year ended March 31, 2026, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Bank at the end of the Financial Year 2025-26 and of the profit of the Bank for that period;

c. the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 and other applicable laws for safeguarding the assets of the Bank and for preventing and detecting fraud and other irregularities;

d. the Directors had prepared the annual accounts for the Financial Year ended on March 31, 2026, on a going concern basis;

e. the Directors had laid down internal financial controls to be followed by the Bank and that such internal financial controls are adequate and operating effectively; and

f. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

GENERAL

No disclosure or reporting is required in respect of the following items as it is not applicable / there were no transactions on these items during the year under review:

? Neither the Managing Director nor the Whole-Time Director of the Bank received any remuneration or commission from Bank's subsidiary.

? There were no Issue of equity shares with differential rights as to dividend, voting or otherwise.

? There were no revisions in the financial statements.

? There were no Issue of share (including sweat equity shares) to employees of the Company under any scheme as permitted under any provision of Companies Act, 2013 except under Employee Stock

Option Scheme (ESOS) as mentioned elsewhere in the Directors' Report.

? The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

ACKNOWLEDGEMENTS

The Board of Directors places on record its gratitude to the Reserve Bank of India, Securities and Exchange Board of India, Government of India, Government of Kerala and all other State Governments where the Bank operates, other Government and Regulatory Authorities, including Stock Exchanges, where the Bank's securities are listed and correspondent Banks for their strong support and guidance, during the year. The Board also places on record its gratitude to the Bank's security-holders and customers for their

continued support, patronage and goodwill. The single most important pillar of any Institution is its personnel, more so in the case of a service entity like a Bank, the Board acknowledges this fact and thanks all of them for their diligence and loyalty towards the Bank. The Board expresses its sincere appreciation for the dedicated services rendered by officers and employees of the Bank at all levels.