Directors Report of CSB Bank Ltd.

Mar 31, 2025

Your Board of Directors (the “Board”) have pleasure in
presenting you the 104th Annual Report of CSB Bank
Limited (“CSB Bank/ the Bank”) together with the Audited
Financial Statements, Independent Auditors'' Report and
the Report on the business and operations of the Bank for
the financial year ended March 31, 2025.

FINANCIAL PERFORMANCE AND STATE OF THE BANK’S
AFFAIRS

The financial highlights of the Bank for the financial year
under review, are presented below:

Particulars	March 31, 2025	March 31, 2024
Deposits	36,861.49	29718.80
Net Advances	31,507.05	24335.58
Total Assets/Liabilities	47,836.27	36055.99
Interest Income	3,597.14	2927.54
Net Interest Income (NII)	1,476.18	1476.41
Non-Interest Income	972.05	584.29
Operating Profit/ (Loss)	910.24	779.92
Provisions and Contingencies (Other than tax)	110.71	18.48
Profit /(Loss) before Tax	799.53	761.45
Provision for taxes	205.73	194.62
Net Profit /(Loss)	593.80	566.82
Add: Surplus/(Deficit) brought forward from last year	622.57	207.29
Profit & Loss Account balance before appropriations	1,216.37	774.11
Appropriations
Statutory Reserve u/s 17 of the Banking Regulation Act, 1949.	148.45	141.70
Capital Reserve	Nil	1.53
Revenue & Other Reserves	4.40	4.29
Investment Reserve Account	Nil	4.02
Investment Fluctuation Reserve	107.23	Nil
Balance carried over to Balance Sheet	956.29	622.57

Particulars	March 31, 2025	March 31, 2024
Key Performance Indicators
Capital Adequacy Ratio (CRAR)% Basel - III	22.46	24.47
Earnings per share (in '')	34.23	32.67
Book value per share (in '')	249.24	209.11
Net Interest Margin%	4.13	5.09

Particulars	March 31, 2025	March 31, 2024
Cost-Income Ratio %	62.82	62.15
Return On Assets (ROA) %	1.49	1.79
Return On Equity (ROE) %	15.44	17.37
Gross NPA %	1.57	1.47
Net NPA %	0.52	0.51

BUSINESS STRATEGY OVERVIEW

Your Bank is primarily driven by the Sustain Build Scale (SBS)
2030 strategy, which was rolled out in FY 2022, with a clearly
defined implementation horizon of eight years. SBS 2030
encompasses your Bank''s long-term vision to become a mid¬
sized new age bank by FY 2030, with an ambitious objective of
eventually positioning itself as the “Bank of the Future (BoTF)”.
The vision is being rolled out in 3 phases. The five key pillars on
which the above vision is built around are governance, human
capital, technology, customer service and compliance. The
initial Sustain phase is aimed at sustaining our core strengths
and the rich legacy that we have painstakingly built over a
period of 100 plus years. Build phase which extends till FY 26,
targets to put in place all the required platforms, which would
help the bank to scale at a level required for becoming the
mid-sized bank and finally the ‘BoTF''. Under build phase, the
key milestones that are being pursued are - Pan India network
expansion, creating enhanced product suite, building a
strong liability franchise, continuing with the gold loan focus,
process re-engineering and strengthened risk management/
compliance/governance standards. All this is targeted to
be achieved alongside the overall tech revamp including the
Core migration to Flex Cube (FC). We are at the advanced
stage of the build phase with the successful CBS migration,
implementation of various surround systems, OGL, OFSAA
etc. Your bank has achieved all the key milestones set under
the build phase, the most critical one being the readiness for
revamping the entire tech stack. Growth oriented policies
have been put in place. Apart from tech infra, the bank
continued its investments in distribution and has a network of
829 branches and 791 ATMs as on March 31, 2025. Once the
system stabilises, the retail journey will pick up. From FY 27, the
scale phase will start in true perspective, which will ultimately
help your bank to achieve the long-term goal of transforming
into a new age private sector bank by creating value by means
of customer centricity, meaningful collaboration, connecting
ecosystems, innovation etc

PERFORMANCE OVERVIEW

During the period under review, your Bank continued to
deliver on stakeholder expectations by demonstrating
good performance across most of the key parameters,

despite facing a challenging and adverse environment.
Bank''s growth trajectory remained steady and clearly
discernible over the years and the performance during the
financial year under review was no exception with many
key business parameters/metrics surpassing industry
growth rate/benchmarks, despite a few areas of relative
underperformance. Bank successfully achieved topline
targets, the bottom-line performance was marginally below
expectations, and this shortfall was primarily attributed to
prevailing liquidity constraints in the ecosystem, systemic
stress and slippages.

In the Financial year 2024-25, the total income grew by
'' 1,057.37 crore to '' 4,569.20 crore from '' 3,511.83 crore in
the corresponding previous financial year. During the same
period, Interest Income increased by '' 669.60 crore to
'' 3,597.14 crore from '' 2,927.54 crore and Non-Treasury
Other Income increased by '' 337.46 crore to '' 874.10
crore from '' 536.64 crore in the corresponding previous
financial year. During the same period, Net Treasury Income
increased by '' 50.30 crore to '' 97.95 crore from '' 47.65
crore in the corresponding previous financial year.

During FY 2024-25, the total Operating Profit of the
Bank increased by '' 130.32 crore to '' 910.24 crore from
'' 779.92 crore and Net Profit increased by '' 26.98 crore to
'' 593.80 crore from '' 566.82 crore in the corresponding
previous financial year. The profit came in the backdrop
of a strong Non-interest income, backed by processing
fee, commissions on selling third party products, charges
collected from deposit accounts, treasury profit and
Income received from sale of PSLC. However, the Net
Interest Income registered a slight decline in the same
period compared to the previous financial year, primarily
due to tight liquidity conditions lead to elevated deposit
rates, increased hedging costs, and shifts in the business
mix.

In the same period, the Bank''s gross advances grew by
'' 7,270.23 crore to '' 31,841.98 crore led by 35% growth
in gold loans to '' 14,094 crore from '' 10,407 crore, 33%
growth in SME/MSME to '' 4,241 crore from '' 3,200 crore,
24% growth in retail loan to '' 6,233 crore from '' 5,009
crore and 22% growth in corporate loan to '' 7,274 crore
from '' 5,956 crore.

In the same period, the Deposits grew by '' 7,142.68
crore to '' 36,861.49 crore from '' 29,718.80 crore in the
corresponding previous financial year.

Gross non-performing assets (GNPAs) increased by
'' 13739 crore to '' 498.46 crore as on March 31, 2025 from
'' 361.07 crore as on March 31, 2024. Net non-performing
assets (Net NPAs) increased by '' 38.63 crore to '' 163.53
crore as on March 31, 2025 from '' 124.90 crore as on
March 31, 2024. The gross NPA as percentage of advances

increased by 10 basis points to 1.57% as on March 31, 2025
as against 1.47% as on March 31, 2024. Net NPAs increased
by 1 basis points to 0.52% as of March 31, 2025 from 0.51%
as on March 31, 2024. Provision Coverage Ratio (including
write off) stood at 83.71% at the end of the financial year as
against 86.44% in the corresponding previous financial year.
Total Assets have increased by '' 11,780.28 crore and stood
at '' 47,836.27 crore as on March 31, 2025 as against
'' 36,055.99 crore as on March 31, 2024. Net Advances
have increased by '' 7,171.47 crore and stood at '' 31,507.05
crore as on March 31, 2025 as against '' 24,335.58 crore as
on March 31, 2024.

FINANCIAL PERFORMANCE

Net Interest Income (NII) stood at '' 1,476.18 crore in
FY 2024-25 as against '' 1476.41 crore in FY 2023-24.
Non-Treasury Other Income increased by '' 337.46 crore
to '' 874.10 crore in FY 2024-25 from '' 536.64 crore in
FY 2023-24. Net Treasury Income also increased by '' 50.30
crore to '' 97.95 crore in FY 2024-25 from '' 47.65 crore in
FY 2023-24.

Provisions other than taxes increased by '' 92.23 crore from
'' 18.48 crore to '' 110.71 crore. The Operating Profit for the
financial year 2024-25 was '' 910.24 crore before taxes
and provisions as against '' 779.92 crore in the financial
year 2023-24 mainly on account of increased other income
including treasury profits.

The Net Profit for the financial year 2024-25 was '' 593.80
crore as compared to a Net Profit of '' 566.82 crore in the
financial year 2023-24.

DIVIDEND

The Bank has formulated the Dividend Distribution Policy
as per the requirements of Regulation 43A of Securities
and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015, ("SEBI Listing
Regulations”) and guidelines issued by Reserve Bank of
India (the “RBI”).

The objective of the Policy is to lay down the criteria to be
considered by the Board, before recommending dividend
to its shareholders, whether it be Interim/Special Dividend
or Final Dividend. The Bank believes in optimizing the
shareholder''s wealth by offering them various corporate
benefits from time to time after considering the Capital
to Risk (Weighted) Assets Ratio (CRAR) and reserve
requirements subject to regulatory stipulations.

The directors, with the object of conserving the profits
to strengthen its balance sheet further, do not propose
to recommend any dividend for the financial year ended
March 31, 2025, despite the Bank posted a commendable
net profit in the same period.

The Dividend Distribution Policy is available on the Bank''s
website at https://www.csb.co.in/pdf/CSB_Dividend_Policy.
pdf.

CHANGE IN THE NATURE OF BUSINESS

During the financial year under review, there has been no
change in the nature of business of the Bank.

MATERIAL CHANGES AND COMMITMENTS AFFECTING
THE FINANCIAL POSITION OF THE BANK

There are no material changes and commitments affecting
the financial position of the Bank which has occurred
between the end of the financial year of the Bank i.e.,
March 31, 2025 and the date of the Board''s Report.

CAPITAL STRUCTURE

The Authorised share capital of the Bank stood at '' 220.00
crore divided into 22 crore equity shares with a face value of
'' 10/- each as on March 31, 2025. During the financial year
under review, there has been no change in the Authorised
share capital of the Bank.

The Paid-up Equity Capital of the Bank stood at '' 173.49
crore comprising 17,34,85,827 fully paid-up Equity Shares
of '' 10/- each as on March 31, 2025. The Bank has not
allotted any shares during the financial year 2024-25,
and as a result, the paid-up capital of the Bank remains
unchanged, i.e., '' 173.49 crore, in the said period.

NET OWNED FUNDS

The Bank''s Net owned funds grew to '' 4,256.63 crore from
'' 3,563.64 crore as of the previous financial year, and
market capitalisation stood at '' 5,243.61 crore as on March
31, 2025 as against '' 7,000.15 crore as on March 31, 2024.

CAPITAL ADEQUACY RATIO

The Bank''s overall Capital Adequacy Ratio (CRAR) under
Basel III stood at 22.46% at the end of fiscal 2025, well
above the benchmark requirement of 11.50% stipulated by
Reserve Bank of India. Of this, the Common Equity Tier I
(CET I) CRAR was 20.59% (against minimum regulatory
requirement of 8.00%) and Tier I CRAR was 20.59% (against
minimum regulatory requirement of 7.00%). As on March 31,
2025, the Bank''s Tier II CRAR under Basel III stood at 1.87%
as against 1.37 % as on March 31, 2024.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3) (c) read with Section 134 (5)
of the Companies Act, 2013, the Board of Directors, to the
best of its knowledge and ability, confirm that;

a. In the preparation of the annual accounts for the
financial year ended March 31, 2025, the applicable

accounting standards had been followed along with
proper explanation relating to material departures.

b. The directors have 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 2024-25 and of
the profit and loss 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 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, 2025, 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 were operating
effectively.

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.

PROMOTER HOLDING - FIH MAURITIUS INVESTMENTS
LTD

FIH Mauritius Investments Ltd (FIHM), the promoter of
the Bank holds 40.00% of the paid-up capital of the
Bank in line with Reserve Bank of India Master Direction,
viz., (Acquisition and Holding of Shares or Voting Rights in
Banking Companies) Directions, 2023 (“Master Direction”)
read with Reserve Bank of India Guidelines on Acquisition
and Holding of Shares or Voting Rights in Banking
Companies (“Guidelines”), dated January 16, 2023. FIHM
holding in the Bank is subject to the dilution schedule as
mandated by Reserve Bank of India and the relevant RBI
guidelines as applicable, from time to time.

FIHM, on June 27, 2024, as part of the dilution schedule,
sold 16,868,645 shares, which constitute 9.72% of the
paid-up capital of the Bank, and accordingly, their holdings
were brought down to the current level of 40.00% of the
paid-up capital of the Bank from 49.72% at the beginning
of the financial year.

Pursuant to Section 12(2) of Banking Regulation Act,
1949 and RBI Gazette Notification no. DBR.PSBD. No.
1084/16.13.100/2016-17 dated July 21, 2016, read with
Guidelines dated January 16, 2023, voting rights of FIHM
is currently capped at 26% of the total voting rights of the
Bank.

DISCLOSURE OF CERTAIN TYPE OF AGREEMENTS
BINDING THE BANK

The Bank has entered into an Investment Agreement
(“Agreement”) dated February 20, 2018, with FIH Mauritius
Investments Ltd (FIHM), the promoter of the Bank, which
was superseded and replaced by Amended and Restated
Investment Agreement dated October 15, 2018, read with
Addendum No. 1 dated October 19, 2020 (“Addendum”) to
the Amended and Restated Investment Agreement dated
October 15, 2018. The salient features of the agreement in
terms of Regulation 30A of SEBI (Listing Obligations and
Disclosure Requirements), Regulations, 2015 read with
clause 5A of paragraph A of Part A of Schedule III of the SEBI
Listing Regulations was disclosed in the Annual Report of
the Bank for the financial year 2023-24. The shareholders
may refer page no. 93 of the said Annual Report for further
information.

Except as stated above there are no other agreements
which mandates a disclosure under of Regulation 30A of
SEBI (Listing Obligations and Disclosure Requirements),
Regulations, 2015 read with clause 5A of paragraph A of
Part A of Schedule III of the SEBI Listing Regulations.

QUALITY INITIATIVES

CSB Institute of Learning & Development (CSBILD) has
emerged as a pillar of capacity building, enhancement and
professional development within the Bank. Through a suite
of structured programme and forward-thinking learning
initiatives, CSBILD consistently equips employees with the
critical knowledge and skills needed to excel in a rapidly
evolving banking landscape. By aligning its efforts with the
Bank''s strategic vision, CSBILD plays a vital role in driving
long-term organisational success and fostering a culture of
continuous growth.

CSBILD achieved a significant achievement in FY 2024-25
by ensuring 100% employee participation across a diverse
array of learning platforms, including online, campus-based,
and external programme. During the year, total training
hours reached 2,15,567 hours, resulting in a per employee
learning average of 30 hours. This commitment to continuous
development was reflected across the workforce, with male
employees averaging 29.29 hours and female employees
averaging 31.14 hours, underscoring CSBILD''s dedication to
inclusive and impactful learning.

During FY 2024-25, two key learning initiatives were
rolled to enhance employee development. The first, DORM
(Demonstrate, Observe, Release & Monitor), is a structured
four-step, on-the-job training framework conducted by
supervisors over a 90-day period, aimed at accelerating
the onboarding and performance of new team members.
The second initiative, DISHA, features concise learning

modules delivered under a unified brand identity. These
sessions are conducted simultaneously across all branches
on the first and third Saturdays of each month, fostering
a culture of continuous learning. Covering a wide array of
topics-from products and processes to essential skills—
these modules are facilitated by branch heads to promote
active engagement and participation.

Building on its momentum in the current financial year,
CSBILD has continued its structured five-day onboarding
programme, ‘Neev'', aimed at equipping new hires for
success. In addition, a self-paced online progamme titled
‘Neev NXT - BM'', specifically designed for newly appointed
Branch Managers was conducted. This five-day programme
is tailored for newly appointed Branch Managers, helping
them adapt to their roles with greater productivity.

CSBILD has also retained its ISO 9001:2015 certification,
originally obtained in the previous financial year,
underscoring its commitment to maintaining high standards
in learning and development.

DIVERGENCE IN ASSET CLASSIFICATION AND
PROVISIONING FOR NPAS

In terms of Reserve Bank of India (the “RBI”) guidelines,
banks are required to disclose the divergences in asset
classification and provisioning consequent to RBI''s annual
supervisory process in their notes to accounts to the
financial statements. The disclosure is required if either
or both of the following conditions are satisfied: (a) the
additional provisioning for NPAs assessed by RBI exceeds 5%
of the reported profit before provisions and contingencies
for the reference period; and (b) the additional gross NPAs
identified by RBI exceed 5% of the published incremental
gross NPAs for the reference period.

Based on the above, no disclosure on divergence in asset
classification and provisioning for NPAs is required with
respect to RBI''s annual supervisory process for fiscal 2024

HUMAN RESOURCES

For a detailed update on Human resources activities,
please refer to the report on Human Resources / Industrial
Relations in the Management Discussion & Analysis section
for detailed analysis.

CREDIT RATINGS OF DEBT INSTRUMENTS

CRISIL, vide letter dated May 20, 2025, reaffirmed the
rating ‘CRISIL A1 '' to the '' 2,500 crore Certificate of
Deposits Programme and '' 2,000 crore Short Term Fixed
Deposits Programme of the Bank.

CRISIL, vide letter dated May 20, 2025, reaffirmed ‘CRISIL
A /Stable'' rating to the proposed '' 500 crore Tier II, Basel
III compliant bonds issue Programme of the Bank. India

Ratings and Research, vide letter dated August 16, 2024,
reaffirmed its rating of ‘IND A'' with Outlook Stable, to the
proposed '' 500 crore Tier II, Basel III compliant bonds issue
Programme of the Bank. The Bank has not yet issued any
bonds as part of the programme.

The further details of all credit ratings obtained by the
Bank along with revisions thereto, if any, during fiscal 2025,
for all the debt instruments outstanding as on March 31,
2025, are provided in the Report on Corporate Governance,
forming part of this annual report.

DEPOSITS ISSUANCE PROGRAMME

During the period under review, your Bank raised '' 3,675
crore under the Certificate of Deposits (CD) programme,
sourced from various mutual funds and banks. As of March
31, 2025, the outstanding amount under this programme
stood at '' 1,750 crore compared to '' 1,030 crore as on
March 31, 2024. The Bank has not raised deposits under
the Short-Term Fixed Deposits Programme during the
period under review.

ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING
RIGHTS

As on the date of this Report, the Bank has not issued any
equity shares with differential voting rights.

ISSUE OF SWEAT EQUITY SHARES

As on the date of this Report, the Bank has not issued any
sweat equity shares.

EMPLOYEES STOCK OPTION SCHEME

CSB Employees Stock Option Scheme 2019

The Bank, on receipt of approval of the shareholders by
postal ballot on May 4, 2019, formulated and adopted a
stock option scheme called "CSB Employees Stock Option
Scheme 2019” ("ESOS 2019” or "Scheme”). The Scheme
is in compliance with the SEBI (Share Based Employee
Benefits) Regulations, 2014 which was subsequently
repealed and replaced with the Securities and Exchange
Board of India (Share Based Employee Benefits and Sweat
Equity) Regulations, 2021.

The Scheme is intended to enable the employees, present
and future, to get a share in the value that they help to
create for the organisation over a period of time, aligning
the objectives of an individual with those of the Bank as
well as to attract and retain critical senior talents with
Employee Stock Options as a compensation tool.

The Scheme shall be administered through an employee
stock option trust ("ESOS Trust”) in the nature of an
irrevocable employee welfare trust in due compliance with
the applicable laws.

Under the Scheme, 10,51,818 stock options were granted in
the financial year 2024-25. All the options were granted at
market price, to be vested subject to the vesting conditions/
malus and claw back arrangements and be exercised within
the period as per the terms of the grant and the Scheme.
As on March 31, 2025, 13,86,788 options were vested in
line with the vesting schedule, of which 8,32,067 options
were exercised by the grantees and 1,11,919 vested options
were lapsed due to resignation/ non-exercise within the
prescribed timeline. In FY 2024-25, 1,40,855 options were
lapsed prior to its vesting schedule due to the resignation/
separation of employment by the grantees. As on March 31,
2025, the number of options are in force is 29,46,792 of
which 4,42,802 are vested options.

Pursuant to the approval received from Reserve Bank of
India on October 22, 2024, the Nomination & Remuneration
Committee of the Board on October 24, 2024, granted
1,43,435 stock options to Mr. Pralay Mondal, Managing
Director & CEO, at an exercise price of '' 303.15 per option
for the performance period from April 01, 2023 to March
31, 2024.

Amendment proposed in the CSB Employees Stock
Option Scheme 2019

No amendment is proposed to the CSB Employees Stock
Option Scheme 2019 in the ensuing Annual General Meeting
of the Bank.

CSB Employees Stock Option Scheme - Statutory
Compliance

A Certificate of Secretarial Auditors of the Bank pursuant
to Regulation 13 of the Securities and Exchange Board
of India (Share Based Employee Benefits and Sweat
Equity) Regulations, 2021, that the CSB Employees Stock
Option Scheme 2019 has been implemented in the Bank in
accordance with the SEBI (Share Based Employee Benefits
and Sweat Equity) Regulations, 2021, and the resolution
passed by the Shareholders for the Scheme, will be
placed to the Annual General Meeting for the scrutiny of
Shareholders.

The statutory disclosures as required as per rule 12(9)
of the Companies (Share Capital and Debentures) Rules,
2014 and Regulation 14 of the SEBI (Share Based Employee
Benefits and Sweat Equity) Regulations, 2021, are given on
the website of the Bank at www.csb.co.in which forms part
of this report as Annexure-I.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT

CSB Bank''s legacy, spanning over a century, is deeply
rooted in trust, ethics, and transparency. Throughout
its history, the Bank has dedicated itself to serving the

needs-based sections of society by providing banking
services with responsibility and transparency. This
steadfast commitment has profoundly impacted the
communities it serves. While focusing on its core business,
CSB Bank consistently prioritises environmental, social,
and governance (ESG) concerns, which are reflected in
its practices and initiatives. By adhering to exemplary
corporate governance standards, the Bank ensures that
transparency and disclosure remain at the forefront of its
principles.

The Bank in compliance with Regulation 34(2)(f) of the
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 read with the SEBI Master Circular
No. SEBI/HO/CFD/PoD2/CIR/P/0155 dated November
11, 2024, presents the Business Responsibility and
Sustainability Report (BRSR) of the Bank for the FY 2024¬
25, being the fourth report of its kind, in the format as
specified by SEBI, describing the initiatives taken by
the Bank from an environmental, social and governance
perspective, forms part of this Report as Annexure-II.

The Report indicates the Bank''s performance against the
nine principles of the ‘National Guidelines on Responsible
Business Conduct''. Reporting under each principle is
divided into essential and leadership indicators. The
report has also been hosted on the website of the Bank
and can be accessed at https://www.csb.co.in/general-
meetings>Annual General Meeting - 2025.

BUY-BACK OF SHARES OR PROVISION OF FINANCIAL
ASSISTANCE FOR PURCHASE OF THE BANK’S SHARES

The Bank has not effected any buy-back of its shares
or provided any financial assistance for purchase of its
shares, to any persons including directors and employees
of the Bank in terms of Section 67 of the Companies Act,
2013.

DISCLOSURE RELATED TO DETAILS OF DEPOSITS
ACCEPTED

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

SUBSIDIARIES AND ASSOCIATES

The Bank does not have any subsidiaries, joint ventures or
associate companies.

There are no companies which have become or ceased to
be its subsidiaries, joint ventures or associate companies
during the year under review.

The Bank has formulated a Policy for determining material
subsidiaries pursuant to the Securities and Exchange Board

of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and the same is displayed on the website
of the Bank at: https://www.csb.co.in/pdf/2Policy-for-
Determining- Material-Subsidiary.pdf

RISK MANAGEMENT POLICY

The Bank has a comprehensive policy framework which
contains separate policies for identification, measurement,
monitoring & control and mitigation of all material risks
including but not limited to credit, market, operational,
liquidity and other Pillar- II risks. The Bank has put in
place an integrated risk management policy which ensures
independence of the risk governance structure. IRMD
Charter is included in the Integrated Risk Management
policy. The risk management policy details the principles,
rules and guidelines to be adopted by the Bank for managing
and controlling various kinds of risks through various sub¬
policies. The policies are implemented in an uninterrupted,
reliable and comprehensive manner across the Bank. The
details of risk management practices are provided in the
Management Discussion and Analysis Report annexed to
the Director''s Report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

A set of policies, that include Whistle Blower Policy, Anti¬
Bribery & Anti-Corruption Policy and Policy to deal with
Employee frauds are devised and formulated by the
Vigilance Department as part of its ongoing preventive
vigilance. These are scrupulously followed, for surveillance
and control to prevent frauds and thereby manage the
risk of eventual financial loss or Bank''s reputation. These
policies are aligned with the directions of RBI, Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the Companies Act, 2013
and SEBI (Prohibition of Insider Trading) Regulations, 2015,
as amended.

One such policy, the Whistle Blower policy is an effective
tool to report concerns regarding unethical behaviour,
violation of systems & procedures, questions of law,
wrong business practices or grave misconduct by the
employees. As per this Policy, all stake holders viz Directors
and employees of the Bank, customers, vendors, Non¬
Governmental Organisations (NGO) or any other person
others can lodge complaints. Link for the same is published
on the Bank''s Website. The Audit Committee of the Board
(ACB) oversees the vigil mechanism through its committee
processes. The Chairman of ACB directly hear grievances
reported in the whistle blower complaints. Policy provides
reassurance/protection to the whistle blower from
victimisation, discrimination or reprisals for having blown
the whistle, in good faith and in the interest of the Bank,
identity of the whistle blower kept secret. The investigation

under this policy shall be completed within 60 days from
the date of receipt of the complaint and the report thereof
should be placed before the ACB.

As part of the awareness programme, the said policies as
well as the Ethics & Code of conduct for staff are included
in sessions of the training programme conducted at the
Bank''s Human resource team, for enhancing awareness
of fraud risk and for promoting a culture of compliance
amongst the employees.

Bank is taking stringent action against those employees,
vendors who fail to comply with the Bank''s policy.
Deficiencies/irregularities/Lacunae in the system and
procedures, if any, observed during the investigation are
plugged and wherever necessary systemic corrections
are suggested and placed before the ACB for necessary
directions. Further, with regard to the irregularities
committed, the concerned officials, vendors are suitably
cautioned so that incidents do not recur. Vigilance
Department issues Caution Note on a regular basis that
create awareness regarding the different modus operandi
adopted by the fraudsters. This enables the Branches /
Offices to prevent similar kind of fraudulent attempts in
future. This policy is reviewed every year by the Board and
suitably amended, as required. A reference to the Whistle
Blower Policy/Vigil Mechanism is also made in every caution
note issued by the Vigilance Department.

Further the Anti-Bribery and Anti-Corruption Policy ensures
that the stakeholders including employees (whether
full-time or contractual, including trainees and interns),
Directors, Agents, Associates, Vendors, Consultants,
Advisors, Representatives, or Intermediaries do not indulge
in any act of ‘Bribery'' or ‘Corruption'' while discharging
their official duties, either in their own name or in the name
of the Bank.

As part of the preventive mechanism, the department also
undertakes Preventive Vigilance Audits, to ensure that
all the checks and balances are in place. This promotes a
culture of compliance amongst its employees. Moreover,
the Bank is making all out efforts to prevent frauds by
strengthening the existing control measures and by
reiterating the systems and procedures, to update and
alert its employees.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to the provisions of Regulation 34(2)(e) of the
SEBI Listing Regulations, the Management Discussion
and Analysis Report for the year under review is provided
in a separate section forming part of this Report as
Annexure - III.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR
ADEQUACY

The Bank has laid down internal financial controls with
reference to its financial statements. The integrity and
reliability of the internal control systems are achieved
through clear policies and procedures, process automation,
training and development of employees, and an organisation
structure that segregates responsibilities. These controls
are reviewed and tested to ensure the accuracy and
completeness of the accounting records and the preparation
of reliable financial statements. The internal financial
controls of the Bank with respect to the financial statements
are adequate and are operating effectively.

The Bank is operating in a fully computerised environment
with Core Banking System supported by diverse application
platforms for handling special business such as treasury,
trade finance, retail loans, etc. The process of recording
transactions i n each application platform is subject to
various forms of control such as in-built system checks,
maker - checker authorisations and independent post
transaction reviews. The financial statements are prepared
based on computer system outputs. Responsibility of
preparations of financial statements is entrusted to a
dedicated unit which is independent of business.

For mitigating risks and for KYC norms compliance, the
Bank has put in place centralised processing for opening of
CASA accounts and modifications in customer information.
For login to CBS, in addition to login passwords, finger-scan-
authentication is implemented and as control measure,
dual custody for cash and gold are in place in all branches.
The Bank has a process in place to continuously monitor the
existing controls and identify gaps, if any, and implement
new and/or improved controls wherever the effect of such
gaps would have a material effect on the Bank''s operation.
During the year under review, there are no material or
serious observations of inefficiency or inadequacy of such
controls observed/reported.

CORPORATE GOVERNANCE

The Bank continues its endeavour to adopt the best
prevalent corporate governance practices. A separate
section/Report on corporate governance standards
followed by your Bank and the relevant disclosures as
stipulated under SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and the Companies Act,
2013 and the rules made thereunder are incorporated in
the Corporate Governance Report that forms part of this
Report as Annexure - IV.

A certificate from Bhandari & Associates, Company
Secretaries, Mumbai, confirming compliance to the
conditions of Corporate Governance as stipulated under
SEBI Listing Regulations is annexed to this report.

UPDATE ON IND AS IMPLEMENTATION

Reserve Bank of India (RBI) vide press release RBI/2018-
2019/146 DBR.BP.BC.No.29/ 21.07.001/2018-19, dated
March 22, 2019, advised all scheduled commercial
Banks about deferment of implementation of Ind AS till
further notice in the context of legislative amendments
recommended by RBI on implementation of Ind AS were
under consideration of the Government of India.

The implementation of Ind AS is expected to result in
significant changes to the way the Bank prepares and
presents its financial statements. The key impact areas
during the implementation of Ind AS for the Bank include
impairment requirements of Financial Instruments based on
Expected Credit Loss, interest recognition using effective
interest method and Fair valuation of financial assets.

As directed by the RBI, the Bank is submitting half yearly
Proforma Ind AS financial statements within the stipulated
timeline.

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS BY THE BANK

Pursuant to Section 186 (11) of the Companies Act, 2013, the
provisions of Section 186 of Companies Act, 2013, except
sub - section (1), do not apply to a loan made, guarantee
given or security provided or any investment made by
a banking company in the ordinary course of business,
hence being excepted from disclosure requirements under
Section 134(3)(g) of the said Act.

The particulars of investments made by the Bank are disclosed
in Schedule 8 of the financial statements as per the applicable
provisions of the Banking Regulation Act, 1949.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS
WITH RELATED PARTIES

The Bank has obtained prior approvals of the Audit
Committee, the Board, and the members of the Bank at the
annual general meeting for all related party transactions/
material related party transactions. Your Bank has
obtained the omnibus approval of the Audit Committee for
those transactions with related parties that are repetitive
in nature. Further, the Audit Committee of the Board has
reviewed all the transactions with the related parties on a
quarterly basis.

No transactions were entered into with related parties,
which were not in the ordinary course of the business of
the Bank or which were not on an arm''s length basis.

During the financial year 2025, the Bank has not entered
into any materially significant transactions with its
related parties, which could lead to potential conflict of
interest between the Bank and these parties, other than
transactions entered into with them in the ordinary course
of its business.

The particulars of contracts or arrangements with related
parties entered into during the period under review in terms
of Section 188(1) of the Companies Act, 2013 are provided
in Form AOC-2 as Annexure -V in terms of 134(3)(h) of the
Companies Act, 2013.

The ‘Policy on materiality of Related Party Transactions
and on dealing with Related Party Transactions'' has been
reviewed by the ACB and the Board and the same is available
on the website of the Bank at https://www.csb.co.in/pdf/
PolicyondealingwithRelatedPartyTransactionnew.pdf in
terms of the SEBI Listing Regulations.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Bank recognise society as a primary stakeholder and
consistently prioritise Corporate Social Responsibility
(CSR) activities, embedding CSR into its core business
strategies to address societal needs, foster a culture of
responsibility and ethical conduct, and ensure sustainable
development through well-structured and impactful
initiatives. The Bank''s CSR policy is meticulously designed
with the primary objective of integrating CSR as a crucial
business process for the sustainable development of
society. This policy functions as a guiding document,
assisting in the identification, execution, and monitoring
of CSR projects, ensuring they align with the spirit of
statutory requirements. The policy outlines clear objectives
and methodologies for CSR initiatives, ensuring that each
project is effectively managed and delivers tangible benefits
to the community. Through this comprehensive approach,
the Bank demonstrates its unwavering commitment to
making a positive impact on society while maintaining
transparency and accountability in all its endeavours. In
the financial year 2024-25, the Bank budgeted a total of
'' 13.90 crores for CSR activities, a significant increase
from '' 3.08 crore in the previous financial year 2023-24.
Of this budget, '' 6.11 crore was expended on various CSR
initiatives. The remaining '' 7.79 crores has been earmarked
for Project Dialysis, a venture undertaken by the Fairfax
India Charitable Foundation. This project is set to be an
ongoing commitment of the Bank.

The Project Dialysis conducted by Fairfax India Charitable
Foundation aims in providing affordable, quality dialysis
services to patients in various parts of India where the
services are limited/non-existent for dialysis infrastructure.
The project was initially approved by the Board as a onetime
arrangement with a contribution of '' 6.00 crore, however,

there was a delay in execution of the project due to delays
in the readiness of dialysis centres that resulted in centres
not being ready for installations of dialysis machines and
these resulted in impeding the progress of the completion
of the project as committed by the foundation at the time
of sanctioning the fund. The Bank, hence, on request of
the foundation, decided to classify the entire project as
an ongoing project with an additional contribution of '' 1.79
crores, which is expected to be completed on or before
March 31, 2026.

The unspent amount of '' 7.79 crores pertaining to the said
ongoing projects were transferred to Unspent CSR account
on April 17, 2025 which will be released in a phased manner
up on receipt of request from the foundation or based on
the progress of the project on or before March 31, 2026.
The projects identified by the Bank spread across areas
such as healthcare, sanitation, education, housing, gender
equality etc., as per the annual action plan approved by the
Corporate Social Responsibility Committee and the Board
of the Bank. As a responsible citizen, the Bank will persist in
implementing a slew of measures to honour its commitment
to society at large.

The Annual Report on Corporate Social Responsibility
Activities of the Bank for the financial year 2024-25, has
been provided in Annexure - VI to this report.

The Corporate Social Responsibility Policy as
recommended by the CSR Committee and as approved by
the Board is available on the website of the Bank and can
be accessed at https://www.csb.co.in/pdf/CSR%20 Policy_
Final_-30032022.pdf.

AUDITORS

(a) Statutory Auditors

The members of the Bank in the 103^rd Annual General
Meeting of the Bank held on August 23, 2024,
approved the appointment of M/s. Sundaram &
Srinivasan, Chartered Accountants, Chennai as one
of the Joint Statutory Auditors of the Bank, to hold
office from the conclusion of 103^rd Annual General
Meeting till the conclusion of the 106^th Annual General
Meeting of the Bank. Walker Chandiok & Co LLP,
Chartered Accountants, Mumbai was the other Joint
Statutory Auditors of the Bank to audit the accounts
for the financial year ended March 31, 2025 and the
Bank obtained approval of the shareholders for their
appointment in the 102nd Annual General Meeting held
on August 08, 2023, to hold office from the conclusion
of 102^nd Annual General Meeting till the conclusion of
the 105^th Annual General Meetings of the Bank.

Bank in terms of Section 30(1A) of the Banking
Regulation Act, 1949, obtained approval of Reserve
Bank of India on May 27, 2025, for the appointment
of M/s. Walker Chandiok & Co LLP, Chartered
Accountants, Mumbai together with M/s. Sundaram
& Srinivasan, Chartered Accountants, Chennai as
the Joint Statutory Auditors of the Bank for the
FY 2025-26 for their 3^rd year and 2^nd year in the office,
respectively.

Pursuant to the amendment made to Rule 3 of the
Companies (Audit and Auditors) Rules, 2014 via the
Companies (Audit and Auditors) Amendment Rules,
2018, effective from May 07, 2018, the requirement
of seeking ratification of the members for the re¬
appointment of the Statutory Auditors has been
withdrawn from the Statute. Hence, ratification of
the members for re-appointment of M/s. Walker
Chandiok & Co LLP, Chartered Accountants, Mumbai
together with M/s. Sundaram & Srinivasan, Chartered
Accountants, Chennai as the Joint Statutory Auditors
of the Bank at the ensuing AGM is not being sought for.
However, the Bank will continue to seek approval of
the shareholders for payment of fees/ remuneration
to the Auditors on a yearly basis though approval of
the shareholders be sought for their appointment for
a period of three years together, in line with the extant
guidelines.

Pursuant to the Regulation 33(1) (d) of the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Joint Statutory Auditors have
confirmed that they are subjected to the peer review
process of the Institute of Chartered Accountants of
India (ICAI) and that they hold a valid certificate issued
by the Peer Review Board of ICAI.

(b) Independent Auditors’ Report

The Joint Statutory Auditors of the Bank viz., M/s. Walker
Chandiok & Co LLP, Chartered Accountants, Mumbai
together with M/s. Sundaram & Srinivasan, Chartered
Accountants, Chennai, have audited the accounts of the
Bank for the FY 2024-25 and their Report is annexed.
Pursuant to Section 143(3)(i) of the Companies Act,
2013, the Statutory Auditors have also reported on
the adequacy and operating effectiveness of the
internal financial controls system over financial
reporting, which has been enclosed as “Annexure A”
to the Independent Auditor''s Report.

There are no qualifications, reservations or adverse
remarks made by the Statutory Auditors in their
report for FY 2024-25.

(c) Secretarial Auditors

Pursuant to the provisions of Section 204 of
the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial
Personnel) Rules, 2014 and amended Regulation 24A
of the SEBI Listing Regulations, the Board has based
on the recommendation of the Audit Committee,
approved the appointment of M/s. BNP & Associates,
Company Secretaries, Mumbai, (Firm Registration No.
P2014MH03740 0), a peer reviewed firm of Company
Secretaries in Practice as Secretarial Auditors of the
Company for a period of five years, i.e., from April 01,
2025 to March 31, 2030, subject to the approval of
the Shareholders of the Bank at the ensuing AGM.

M/s. Bhandari & Associates, Company Secretaries,
Mumbai, (Firm Registration No. P1981MH043700),
was the Secretarial Auditors of the Bank for the
period from FY 2022-23 to FY 2024-25, and the
decision to appoint a new auditor was in the context of
the amendment in Regulation 24A of the SEBI Listing
Regulations.

(d) Secretarial Audit Report

Pursuant to Section 204 of the Companies Act, 2013,
the Bank appointed M/s. Bhandari & Associates,
Company Secretaries, Mumbai as its Secretarial
Auditors to conduct the secretarial audit of the Bank
for the FY 2024-25. The Bank produced all necessary
records to the Secretarial Auditors for the smooth
conduct of the Audit.

The Report of Secretarial Auditors for the said period
is enclosed with this report as Annexure -VII. There
are no qualifications, reservations or adverse remarks
made by the Secretarial Auditors in their report for
the FY 2024-25.

(e) Secretarial Compliance Report

Pursuant to Regulation 24A of SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015
read with circular No. CIR/CFD/ CMD1/27/2019
dated February 08, 2019, issued by SEBI, the Bank
has obtained Secretarial Compliance Report for
the financial year ended March 31, 2025, from
M/s. Bhandari & Associates, Company Secretaries,
Mumbai, the Secretarial Auditors of the Bank on
compliance of all applicable SEBI Regulations and
circulars/ guidelines issued thereunder and the copy
of the same was submitted with the Stock Exchanges
within the prescribed timelines.

(f) Certificate in terms of Regulation 34(3) read with
Schedule V of the SEBI Listing Regulations

In terms of Regulation 34(3) read with Schedule V of
the SEBI Listing Regulations, the Bank has obtained
a Certificate from Bhandari & Associates, Company
Secretaries, Mumbai, confirming that none of the
Directors on the Board of the Bank have been debarred
or disqualified from being appointed or continuing as
Directors of the companies either by the Securities
and Exchange Board of India or the Ministry of
Corporate Affairs or any other Statutory / Regulatory
Authorities. The said certificate is Annexed to this
Report.

(g) Reporting of frauds by Auditors

During financial year ended March 31, 2025, pursuant
to Section 143(12) of the Companies Act, 2013, except
as detailed below, neither the Statutory Auditors nor
the Secretarial Auditor of the Bank have reported
any instances of frauds committed in the Bank by its
officers or its employees.

M/s. Walker Chandiok & Co LLP and M/s. Sundaram &
Srinivasan, Chartered Accountants, Joint statutory
auditors of the Bank, had reported to the Audit
Committee two frauds, involving an amount of '' 125.80
lakh and '' 258.82 lakh, committed by employees of
the Bank at Pallavaram branch and 5 branches at
Tirupur (Tiruppur main, P N Road Tiruppur, Kangeyam,
Kangeyam Road and Mangalam Road), respectively.
The disclosures as required under Section 143(12) of the
Companies Act, 2013 read with Rule 13 of The Companies
(Audit and Auditors) Rules, 2014 are given below:

1. Pallavaram Branch.

1.	Nature of Fraud with description	It is a case of misappropriation of funds by posting dummy cash entries in different accounts.
2.	Approximate Amount involved	''125.80 lakh and the same was recovered.
3.	Parties involved, if remedial action not taken	Branch Operations Manager (BOM) of the branch, was terminated from the service.
4.	Remedial actions taken.	> Regular training/ orientation for employees > Amending the SOP/ Policies/ Guidelines to plug loopholes. > Stringent action against erring officials > Issued caution to employees to be more cautious/ diligent etc.

2. Tiruppur branches (Tiruppur Main, P N Road
Tiruppur, Kangeyam, Kangeyam Road and
Mangalam Road)

1.	Nature of Fraud with description	It is a case of pledge of stolen ornaments at five different branches in Tirupur with active connivance of employees.
2.	Approximate Amount involved	'' 258.82 lakh.
3.	Parties involved, if remedial action not taken	36 Branch officials, 16 customers and 4 outsiders involved. 14 erring officials terminated/ discharged and others awarded punishment viz, stoppage of bonus/ incentive, reduction in pay etc.
4.	Remedial actions taken.	> Regular training/ orientation for employees > Amending the SOP/ Policies/ Guidelines to plug loopholes. > Stringent action against erring officials > Issued caution to employees to be more cautious/ diligent etc.

COMPLIANCE TO SECRETARIAL STANDARDS

The Bank is in compliance with the relevant Secretarial
Standards issued by the Institute of Company Secretaries
of India (ICSI) related to the Board Meetings (SS-1) and the
General Meeting (SS-2) during the FY 2024-25. Further, the
Bank has devised proper systems to ensure compliance
with the provisions of all applicable Secretarial Standards
issued by the Institute of Company Secretaries of India and
that such systems are adequate and operating effectively.

TRANSFER OF UN-CLAIMED/UN-PAID DIVIDEND TO
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Dividend transferred to Unpaid Dividend account and
remaining unpaid or unclaimed for a period of seven years
from the date of such transfer, has to be transferred to
Investor Education and Protection Fund as per Section 124
(5) of the Companies Act, 2013.

Since the Bank had not declared any dividends since the
FY 2014-15, no amount was required to be transferred to
the Investor Education and Protection Fund (the "Fund”) by
the Bank for the financial year ended March 31, 2025.

All the unclaimed dividends pertaining to the prior period/
financial years were transferred to the Fund in the
corresponding previous financial years within the stipulated
time and in the manner as prescribed in Section 124(6) of the
Companies Act, 2013, read with the Investor Education and
Protection Fund Authority (Accounting, Audit, Transfer and
Refund) Rules, 2016, as amended from time to time.

TRANSFER OF EQUITY SHARES TO INVESTOR EDUCATION
AND PROTECTION FUND AUTHORITY

In terms of the provisions of Section 124(6) of the
Companies Act, 2013 read with the Investor Education and
Protection Fund Authority (Accounting, Audit, Transfer and
Refund) Rules, 2016, (as amended) and other applicable
rules, notifications and circulars, if any, every company
is required to transfer the shares, in respect of which
dividend remains unpaid / unclaimed for a period of seven
(7) consecutive years, to the Investor Education Protection
Fund (IEPF) Authority.

Since the Bank had not declared any dividends
since the FY 2014-15, no shares were required to be
transferred to the Investor Education and Protection
Fund Authority by the Bank for the financial year ended
March 31, 2025.

UNCLAIMED SHARE APPLICATION MONEY

There is no unclaimed Share application money pending
with the Bank or to be transferred to Investor Education
and Protection Fund.

COMPENSATION/ REMUNERATION POLICY

The Bank has formulated and adopted a Compensation
Policy in terms of Reserve Bank of India circular no. DOR.
Appt. BC. No.23/29.67.001/2019 -20 dated November
04, 2019, the relevant provisions of Section 178 of the
Companies Act,2013, the relevant Rules made thereunder
and the SEBI Listing Regulations.

The Policy formulates the criteria for determining the
remuneration and further deals with the compensation
and benefits of Non-Executive Chairman, Non-Executive
Directors, Managing Director & CEO, Whole-Time Directors,
Material Risk Takers, Control Function Staff and all other
officials and employees of the Bank.

The details of the Policy have been included in the Report
on Corporate Governance, which forms part of this Report.
The Policy was last reviewed by the Nomination and
Remuneration committee and the Board in their respective
meetings held on October 24, 2024.

The excerpts from the Compensation Policy are available on
the website of the Bank.

NOMINATION POLICY

The Bank has formulated and adopted Nomination policy
for appointment and orderly succession of appointment of
Part-time Chairman, Managing Director & CEO, Whole time
Directors, Directors, Key Managerial Personnel and Senior
Management team in the Bank. The Policy formulates the
criteria for determining qualifications, competencies,
positive attributes and independence for the appointment

of directors. The details of the same have been included in
the Report on Corporate Governance, which forms part of
this Report.

The Nomination Policy was last reviewed by the Nomination
and Remuneration Committee and the Board in their
respective meetings held on December 13, 2024 and
the same is displayed on the website of the Bank at:
https://www.csb.co.in/sites/default/files/annexure-VI_9_
nomination_policy.pdf .

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 of the
Companies Act, 2013 read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel)
Rules, 2014, as amended, in respect of Directors /
Employees of the Bank, is attached as Annexure - VIII to
this Report.

The statement containing names of top ten employees
in terms of remuneration drawn and the particulars of
employees as required under Section 197(12) of the Act
read with Rule 5(2) and 5(3) of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014, is
given in an Annexure and forms part of this report.

In terms of Section 136(1) of the Companies Act, 2013, the
annual report and the financial statements are being sent
to the members, excluding the aforesaid Annexure. The said
Annexure is available for inspection at the registered office
of the Bank, and any member interested in obtaining a copy
of the Annexure may write to the Company Secretary of
the Bank at [email protected].

BOARD OF DIRECTORS

CSB Bank has a broad-based Board of Directors, constituted
in compliance with the Banking Regulation Act, 1949,
Circulars and Guidelines issued by the Reserve Bank of India,
from time to time, the Companies Act, 2013, SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015
and in accordance with the best practices/principles in
corporate governance adopted by the Bank.

As on the date of this report, the Board comprises of eleven
(11) Directors, out of which Seven (7) are Independent
Directors, two (2) are Non-executive, Non-Independent
Directors and Two (2) are Executive Directors. The Directors
possess rich experience and specialised knowledge in
various areas of relevance to the Bank viz. like Agriculture,
Rural Economy, Banking, Accountancy, Co-operation,
Economics, Finance, MSME, Information Technology,
Payment & Settlement Systems, Human Resources, Risk
Management and Business Management, Law, SSI, etc.

The Board functions as the governing body and also
through various Committees constituted to oversee

specific areas. Policy formulation, setting up of goals,
evaluation of performance and control functions vest with
the Board. The Committees have oversight of operational
and supervisory issues assigned to them by the Board,
from time to time.

Appointment/changes in the Board Directors of the Bank
since the last Board''s Report dated June 24, 2024 and up
to the date of the Report is as given under:

RE-APPOINTMENT OF NON-EXECUTIVE DIRECTORS

Director, Mr. Sumit Maheshwari (DIN: 06920646), liable to
retire by rotation, was re-appointed at the Annual General
Meeting held on August 23, 2024.

PART-TIME CHAIRPERSON

The term of appointment of Ms. Bhama Krishnamurthy as
the Part-Time Chairperson of the Bank ended on September
28, 2024, which is coterminous with her second term of
appointment as Independent Director of the Bank.

The Board places on record its appreciation of the
valuable contributions and advises rendered by Ms. Bhama
Krishnamurthy during her tenure as an Independent
Director and the Part-time Chairperson of the Bank. The
Board also took note of the sheer professionalism displayed
by Ms. Bhama Krishnamurthy during her tenure by sharing
unbiased, decisive and professional opinions, keeping in
view of all the stakeholders'' interest at hand.

Mr. Biswamohan Mahapatra (DIN: 06990345) was
appointed as the Part-time Chairperson of the Bank in
place of Ms. Bhama Krishnamurthy for a period of three
years, starting from May 09, 2025 and up to May 08, 2028.

RE-APPOINTMENT OF MANAGING DIRECTOR & CEO

Pursuant to the receipt of approval from Reserve Bank of
India, vide letter no. DoR.GOV.No.2031/08.36.001/2025-
26 dated June 12, 2025, the Board re-appointed
Mr. Pralay Mondal as Managing Director & CEO of the Bank for
a period of three years with effect from September 15, 2025
and upto September 14, 2028.

The present term of appointment of Mr. Pralay Mondal as
Managing Director & CEO is upto September 14, 2025.

APPOINTMENT OF INDEPENDENT DIRECTORS

1. Appointment of Mr. Narasimha Raju Narasappa
Doddahosahalli, (DIN: 01070476) as an Independent
Director

Pursuant to the recommendation of the Nomination
& Remuneration Committee, the Board of Directors
of the Bank in their meeting held on December 13,
2024, appointed Mr. Narasimha Raju Narasappa
Doddahosahalli, (DIN: 01070476) as an Additional

Director (Non-Executive Independent category) of the
Bank w.e.f. December 13, 2024 for a period of three (3)
years pursuant to the provisions of Section 149,161(1) of
the Companies Act, 2013 and Rules made thereunder,
Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations,
2015 ("SEBI Listing Regulations”) and Article 133 of the
Articles of Association of the Bank. The appointment is
subject to the approval of the Shareholders of the Bank
and the approval of the shareholders was obtained for
the appointment of Mr. Narasimha Raju Narasappa
Doddahosahalli as an Independent Director with effect
from December 13, 2024, by postal ballot resolution
dated February 06, 2025.

Mr. Narasimha Raju Narasappa Doddahosahalli is
representing ‘Majority Sector - Agriculture & Rural
economy, Co-operation, Law, SSI, Economics, Finance
& Human Resources'' on the Board of the Bank.

Opinion of the Board with regard to integrity, expertise
and experience (including the proficiency) of the
independent directors appointed during the year:

The Board appointed Mr. Narasimha Raju Narasappa
Doddahosahalli, as an Additional Director of the
Bank under "Non-Executive Independent” category
based on the extensive due diligence carried out by
the Nomination& Remuneration Committee on the
declarations submitted by him in terms of fit & proper
criteria and other applicable statutory guidelines issued
by Reserve Bank of India from time to time.

The Board noted that Mr. Narasimha Raju Narasappa
Doddahosahalli is a Karnataka cadre IAS officer of
1984 batch with over three decades of diverse and
rich experience in various fields. He has held various
significant positions in both Government of India and
Government of Karnataka.

Adverting to the above, in the opinion of the Board, the
said Independent Director appointed on December 13,
2024, possesses the requisite qualifications, proficiency,
expertise, track record, integrity, independence, and
has the necessary knowledge for being appointed as an
Independent Director of the Bank.

!. Appointment of Mr. Biswamohan Mahapatra,
(DIN: 06990345) as an Independent Director

Pursuant to receipt of approval of the members through
resolution passed by means of Postal Ballot dated
April 10, 2025 and pursuant to the recommendation
made by the Nomination & Remuneration Committee,
the Board of Directors in their meeting held on April
16, 2025, appointed Mr. Biswamohan Mahapatra (DIN:
06990345) as an Independent Director of the Bank,

with effect from April 16, 2025 up to August 02, 2029
(both dates inclusive), not liable to retire by rotation.
Mr. Biswamohan Mahapatra is representing the
‘Majority Sector - Banking, Finance, Risk Management,
Law and Payment Systems'' on the Board of the Bank.

Opinion of the Board with regard to integrity,
expertise and experience (including the proficiency)
of the independent directors appointed during the
year:

The Board appointed Mr. Biswamohan Mahapatra, (DIN:
06990345) as an Independent Director of the Bank
under "Non-Executive Independent” category based on
the extensive due diligence carried out by the NRC on the
declarations submitted by him in terms of fit & proper
criteria and other applicable statutory guidelines issued
by Reserve Bank of India from time to time.

The Board noted that Mr. Biswamohan Mahapatra is
a career central banker with over 33 years of intense
experience in various departments of Reserve Bank of
India and retired as Executive Director in RBI in 2014.
Adverting to the above, in the opinion of the Board, the
said Independent Director appointed on April 16, 2025,
possesses the requisite qualifications, proficiency,
expertise, track record, integrity, independence, as
well as vast and rich experience in the field of Banking.

RE-APPOINTMENT OF INDEPENDENT DIRECTORS

Mr. Sharad Kumar Saxena (DIN: 08238872) was reappointed
for a second term as Non-Executive Independent Director
of the Bank, by postal ballot resolution dated February
06, 2025, for a period of 5 (five) years commencing from
February 19, 2025 up to February 18, 2030 (both dates
inclusive), not liable to retire by rotation.

Mr. Sharad Kumar Saxena is representing ‘Majority
Sector - Banking, Information Technology and Payment &
Settlement System'' on the Board of the Bank.

WOMAN DIRECTOR

In terms of the provisions of Section 149(1) of the Companies
Act, 2013 and Regulation 17 of the SEBI Listing Regulations,
the Bank is required to have at least one independent woman
director on the Board. Currently, there are two independent
women directors on the Board of the Bank. Ms. Sharmila
Abhay Karve (DIN: 05018751) since July 20, 2020 and
Ms. Renu Kohli (DIN: 07981627) since December 14, 2023.

DIRECTORS RETIRING BY ROTATION

In terms of Section 152 of the Companies Act, 2013, Non¬
Executive Director, Mr. Madhavan Menon (DIN: 00008542)
shall retire by rotation and being eligible, offers himself for
re-appointment at the ensuing Annual General Meeting (AGM).

Mr. Madhavan Menon was at first appointed as an Additional
Director of the Bank with effect from September 03, 2018
under Section 161(1) of the Companies Act, 2013 and
his appointment was regularised at the 97^th AGM held on
September 29, 2018 and he was liable to retire by rotation.
Mr. Madhavan Menon was last reappointed as a director
to retire by rotation at the 102^nd Annual General Meeting
held on August 08, 2023 in terms of Section 152 of the
Companies Act, 2013.

Approval of the members of the Bank is being requested for
re-appointment of Mr. Madhavan Menon as Non- Executive,
Non-Independent Director of the Bank.

The detailed profile of Mr. Madhavan Menon (DIN:
00008542) recommended for reappointment in the ensuing
Annual General Meeting will be provided in the Notice of the
Annual General Meeting for the benefit of shareholders as
per the provisions of the Companies Act, 2013, SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015
and the Secretarial Standard on General Meetings (SS-2).

INDEPENDENT DIRECTORS - COMPLIANCE STATUS

The Bank fully satisfies the requirements of Section 149
of the Companies Act, 2013 and Regulation 17 of the SEBI
Listing Regulations in connection with the appointment/
re-appointment of Independent Directors and the following
are the Independent Directors of the Bank as on the date
of this report.

Sl. No	Name of the Independent Director	Term	Term of appointment is up to
1	Ms. Sharmila Abhay Karve (DIN: 05018751)	Second	July 19, 2028
2	Mr. Sudhin Bhagwandas Choksey (DIN: 00036085)	Second	January 30, 2029
3	Mr. Sharad Kumar Saxena (DIN: 08238872)	Second	February 18, 2030
4	Ms. Renu Kohli (DIN:07981627)	First	December 13, 2028
5	Mr. Deepak Maheshwari (DIN: 08163253)	First	June 11, 2027
6	Mr. Narasimha Raju Narasappa Doddahosahalli (DIN: 01070476)	First	December 12, 2027
7	Mr. Biswamohan Mahapatra (DIN: 06990345)	Second	August 02, 2029

The performance of the Independent Directors is subject
to evaluation as per Section 149(8) of the Companies Act,
2013 and read with Schedule IV to the said Act.

The Board is confident about their integrity, expertise and
experience in the relevant functional areas.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have confirmed of having
complied with the criteria of independence as provided in
Section 149(6) of the Companies Act, 2013 and Regulation
16(1) (b) of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 read with 25(8) of the
Regulations that they meet the criteria of independence
laid down thereunder. Further, they have also complied with
the Code for Independent Directors prescribed in Schedule
IV to the Companies Act, 2013 and the Code of Conduct
and Ethics for Board of Directors and Senior Management
Personnel of the Bank. Based on the declarations submitted
by the Independent Directors, Board is of the opinion that
they fulfil the conditions specified in the Act and SEBI
LODR and are independent of the Management. There has
been no change in the circumstances affecting their status
as independent directors of the Bank.

Further, pursuant to regulation 5 of the Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, all Independent Directors
have confirmed that while dealing with the Bank, they shall
comply with responsibilities or obligations, if any, assigned
to them under the Securities and Exchange Board of
India (Listing Obligations and Disclosure Requirements)
Regulations, 2015.

Pursuant to rule 6(3) of the Companies (Appointment and
Qualifications of Directors) Rules, 2014, the Independent
Directors of the Bank have affirmed that, they had registered
as an Independent Director in the Independent Directors Data
Bank as required under rule 6(1) and 6(2) of the Companies
(Appointment and Qualifications of Directors) Rules, 2014
and had also complied with the requirements of passing the
online proficiency self- assessment test/ exempted from
online proficiency self- assessment test in terms of Rule
6(4) of the Companies (Appointment and Qualifications of
Directors) Rules, 2014, as amended.

The Board is of the opinion that Independent Directors
appointed since the date of last report and up to the date of
this report are persons of integrity and has the necessary
knowledge, experience and expertise and further, the
Board has ensured that the independent directors have
also complied with the requirements of passing the online
proficiency self-assessment test/exempted from online
proficiency self-assessment test in terms of Rule 6(4) of the
Companies (Appointment and Qualifications of Directors)
Rules, 2014, as amended for being appointed/continue to
be appointed as an Independent Director of the Bank.

FAMILIARISATION PROGRAMMES OF INDEPENDENT
DIRECTORS

All directors, including Independent Directors are familiar
with their roles, rights and responsibilities in the Bank at
the time of appointment and also on a recurring basis.
The Bank facilitates familiarisation programme and other
programmes including Certification programme in IT and
Cyber Security for its directors.

The details of various programmes undertaken/arranged
for familiarizing the Independent Directors and other
programmes arranged for the directors are disclosed in the
Report on Corporate Governance, which forms part of this
Report.

Details of familiarisation programmes attended by all
Directors including Independent Directors are provided at
https://www.csb.co.in/pdf/Disclosure_on_ Familiarisation_
Programmes_for_ Board_of_Directors_22032024.pdf,
pursuant to regulation 46 of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015.

APPOINTMENT/ CHANGES IN KEY MANAGERIAL
PERSONNEL

Mr. Pralay Mondal, Managing Director & CEO, Mr. B. K.
Divakara, Executive Director, Mr. Satish Gundewar, Chief
Financial Officer and Mr. Sijo Varghese, Company Secretary,
continue to be the Key Managerial Personnel of the Bank as
per the provisions of the Companies Act, 2013.

BOARD AND ITS COMMITTEES
Board and Number of Meetings

Regular meetings of the Board are held to discuss and
decide on various business policies, strategies and other
businesses. Due to business exigencies, certain decisions
are taken by the Board through resolution passed by
circulation from time to time.

The Board met ten (10) times during the FY 2024- 25 and
the gap between the said meetings did not exceed the limit
of 120 days, as prescribed under the relevant provisions
of the Act, the relevant Rules made thereunder and the
applicable SEBI Listing Regulations.

The schedule of the meetings of the Board is fixed on a
yearly basis and circulated in advance to the members of
the Board for their consideration and approval.

Detailed information on the meetings of the Board is
included in the report on Corporate Governance, which
forms part of this Report.

Committees of the Board

The Bank has eleven sub-committees of the Board and
the same have been formed as part of the best corporate
governance practices and/or in compliance with the

requirements of the relevant provisions of applicable laws
and regulatory prescriptions.

The details with respect to the compositions, powers, roles,
terms of reference, etc., of the above Committees are given
in detail in the ‘Report on Corporate Governance'' which
forms part of this Report.

AUDIT COMMITTEE

The Bank has constituted the Audit Committee of the
Board in terms of the extant guidelines of Reserve Bank
of India (RBI), provisions of the Companies Act, 2013 and
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015.

The Committee discharges the functions laid down in the
Companies Act, 2013 and those prescribed by the Reserve
Bank of India and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015. It also discharges the
functions delegated by the Board of Directors from time to
time. The ACB acts as an effective tier to the Board in the
matters of inspection, audit and internal control system.
The Board has accepted all the recommendations of the
Audit Committee. The composition, role and functions
of Committee, are provided in the Report on Corporate
Governance, which forms part of this annual report.

ANNUAL EVALUATION OF PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013,
the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and also in line with Board Evaluation
Policy, the Bank has put in place criteria for annual evaluation
of performance of Chairperson, Managing Director & CEO,
Executive Directors, Non-executive Directors, Independent
Directors, Board Level Committees and the Board as a whole.
The performance of the members of the Board other than
independent Directors and the Board as a whole has been
evaluated separately at the meeting of the Independent
Directors.

The performance of the independent Directors has been
reviewed by the Board as provided for under Section 149(8)
read with Schedule IV of the Companies Act, 2013.

The Statement indicating the manner in which formal annual
evaluation of the Directors, Committees of the Board and
the Board are given in detail in the report on Corporate
Governance, which forms part of the Annual Report.

The Nomination & Remuneration Committee of the
Board annually reviews and approves the criteria and the
mechanism for carrying out the said exercise effectively.
The Board Evaluation Policy is displayed on the website
of the Bank at: https://www.csb.co.in/pdf/ Policy
onEvaluationoftheBoard.pdf

PARTICULARS REGARDING CONSERVATION OF ENERGY,
TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO

Considering the nature of activities of the Bank, with
respect to the provisions of Section 134(3)(m) of the
Companies Act, 2013 relating to conservation of energy
and technology adoption, the Bank is constantly pursuing
and making all-out efforts to achieve the desired goals as
contained in the Act.

Ensuring compliance with the provisions of Section 134(3)
(m) of the Companies Act, 2013 read with Rule (8)(3) of the
Companies (Accounts) Rules, 2014, the relevant disclosures
to be made are as under:

a) Conservation of Energy

All attempts are being made to reduce energy
consumption to the maximum extent possible. As part
of these measures, the Bank is installing LED lights and
other energy saving equipments in a phased manner
across.

b) Technology Absorption

The required technology absorption is being made
considering the nature of activities undertaken by the
Bank.

c) Foreign Exchange Earnings and Outgo

Foreign Exchange earnings and outgo are part of
the normal banking business of the Bank. Being an
Authorised Dealer in Foreign Exchange, the Bank has
been taking all possible steps to augment export credit.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY
REGULATORS

During the FY 2024-25, no significant and material orders
were passed by the regulators or courts or tribunals
impacting the going concern status and the Bank''s
operations in future.

MAINTENANCE OF COST RECORDS

Being a banking company, the Bank is not required to make
and maintain such accounts and cost records as specified
by the Central Government under sub-section (1) of Section
148 of the Companies Act, 2013 read with the Companies
(Accounts) Rules, 2014.

CEO & CFO CERTIFICATION

Pursuant to Regulation 17(8) of the SEBI Listing Regulations,
the Certificate issued by Mr. Pralay Mondal, Managing
Director & CEO and Mr. Satish Gundewar, Chief Financial
Officer of the Bank, for the financial year ended March 31,

2025, was placed before the Board at its meeting held on
April 28, 2025.

INFORMATION UNDER THE SEXUAL HARASSMENT OF
WOMEN AT WORKPLACE (PREVENTION, PROHIBITION
AND REDRESSAL) ACT, 2013

The Bank has formulated and adopted a Policy on Prevention
of Sexual Harassment of Women at workplace.

The Bank has complied with the provisions relating to the
constitution of Internal Complaints Committee under the
Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013. The information
relating to complaints received and redressed during
the FY 2024-25 is disclosed in the Report on Corporate
Governance, which forms part of the Annual report.

STRICTURES AND PENALTIES

There are no instances of non-compliance by the Bank and
no penalties or strictures have been imposed on the Bank
by the Stock Exchange(s) and/or SEBI and/or any other
statutory authorities on matters relating to capital market
activities, during the last three years.

DISCLOSURE UNDER THE INSOLVENCY AND
BANKRUPTCY CODE, 2016

Being a banking company, the disclosures required as
per Rule 8(5)(xi)&(xii) of the Companies (Accounts) Rules,
2014, on the details of application made or any proceeding
pending under the Insolvency and Bankruptcy Code, 2016
(31 of 2016) during the year along with their status as at
the end of the financial year and the details of difference
between amount of the valuation done at the time of one
time settlement and the valuation done while taking loan
from the Banks or Financial Institutions along with the
reasons thereof, are not applicable to the Bank.

However, being a banking company, during the period under
review, the Bank was part of the Corporate Insolvency
Resolution Process (CIRP) initiated against two corporate
debtors before NCLT for a total book value of '' 73.99 crore.
Out of two corporate debtors, against one having a book value
of '' 3.88 crore, resolution plan was successfully implemented.

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 of the Companies (Management and
Administration) Rules, 2014, as amended, the Annual
Return (MGT-7) as on March 31, 2025, will be displayed on
the website of the Bank at: https://www.csb.co.in/general-
meetings > Annual General Meeting - 2025.

ANNEXURES FORMING A PART OF THIS REPORT

The following Annexures as referred to in this Report form part of the Board''s Report:

Annexure	Particulars
Annexure - I	Disclosures under SEBI (Share Based Employee Benefits And Sweat Equity) Regulations, 2021 and/or the Companies Act, 2013.
Annexure - II	Business Responsibility and Sustainability Report (BRSR) of the Bank for FY 2024-25.
Annexure - III	Management Discussion and Analysis.
Annexure - IV	Report on Corporate Governance.
Annexure - V	Form AOC-2 - The particulars of contracts or arrangements with related parties entered in terms of Section 188(1) of the Companies Act, 2013.
Annexure - VI	The Annual Report on Corporate Social Responsibility activities of the Bank for the FY 2024-25.
Annexure - VII	Secretarial Audit Report.
Annexure - VIII	Disclosure under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

ACKNOWLEDGEMENTS AND APPRECIATIONS

The Board of Directors is grateful to the Government of India, Reserve Bank of India, Securities and Exchange Board of India,
Ministry of Corporate Affairs, Stock Exchanges, Insurance Regulatory and Development Authority of India, the domestic
banking community, Depositories and Rating agencies for their continued support and guidance. The Board of Directors
would like to take this opportunity to express sincere thanks to its valued customers for their continued patronage.

The Board extends its profound appreciation and heartfelt thanks to every member of the CSB family for their continued
commitment, ethics, outstanding performance, professionalism, teamwork and initiatives. These qualities have significantly
contributed to reinforcing the Bank''s customer-centric image and achieving commendable progress in today''s challenging
and competitive environment. The Board looks forward to their continued dedication, sincere and committed passion to work
to propel the Bank to new heights, especially the Bank is progressing towards its vision to become a mid-sized bank by 2030''
through the strategy ‘SBS 2030''-''Sustain, Build, Scale'', a comprehensive roadmap that manifests the Bank''s commitment
to excellence and growth.

Finally, the Board of Directors wishes to express their profound gratitude to all shareholders, well-wishers, and other
stakeholders for their unwavering support and patronage. The Board looks forward to continuing this mutually supportive
and beneficial relationship in future as well to achieve the strategy.

By Order of the Board
Sd/-

Biswamohan Mahapatra

Place: Thrissur Chairperson

Date: June 24, 2025 (DIN: 06990345)

---

Mar 31, 2024

Your Board of Directors (the “Board”) have pleasure in presenting you the 103^rd Annual Report of CSB Bank Limited (“CSB Bank/ the Bank”) together with the Audited Financial Statements, Independent Auditors'' Report and the Report on the business and operations of the Bank for the financial year ended March 31, 2024.

FINANCIAL PERFORMANCE AND STATE OF THE BANK’S AFFAIRS

The financial highlights of the Bank for the financial year under review, are presented below:

('' in Cr)
Particulars	March 31, 2024	March 31, 2023
Deposits	29,718.80	24,505.81
Net Advances	24,335.58	20,650.65
Total Assets/Liabilities	36,055.99	29,162.28
Interest Income	2,927.54	2,319.65
Net Interest Income (NII)	1,476.41	1,333.84
Non-Interest Income	584.29	315.68
Operating Profit/ (Loss)	779.92	707.40
Provisions and Contingencies (Other than tax)	18.48	(26.21)
Profit /(Loss) before Tax	761.45	733.61
Provision for taxes	194.62	186.25
Net Profit /(Loss)	566.82	547.36
Add: Surplus/(Deficit) brought forward from last year	207.29	(198.83)
Profit & Loss Account balance before appropriations	774.11	348.53
Appropriations
Statutory Reserve u/s 17 of the Banking Regulation Act, 1949.	141.70	136.84
Capital Reserve	1.53	0.14
Revenue & Other Reserves	4.29	4.27
Investment Reserve Account	4.02	Nil
Investment Fluctuation Reserve	Nil	Nil
Balance carried over to Balance Sheet	622.57	207.29
('' in Cr)
Particulars	March 31, 2024	March 31, 2023
Key Performance Indicators
Capital Adequacy Ratio (CRAR)% Basel - III	24.47	27.10
Earnings per share (in '')	32.67	31.55
Book value per share (in '')	209.11	175.90

Particulars	March 31, 2024	March 31, 2023
Net Interest Margin%	5.09	5.48
Cost-Income Ratio%	62.15	57.12
Return On Assets (ROA)%	1.79	2.06
Return On Equity (ROE)%	17.37	20.35
Gross NPA %	1.47	1.26
Net NPA %	0.51	0.35

BUSINESS STRTGEY OVERVIEW

To position the Bank on the lines of successful New Gen Private Sector Banks, your Bank had rolled out a change management theme of Sustain Build Scale 2030 (SBS 2030) in FY 2021-22. The key milestones that were set for the initial years were to sustain the core strengths and to build the right platforms and foundations for the scale phase. Bank could complete the milestones set for FY 2023-24, as per the timelines and progressed well. During FY 2023-24, we continued to sustain our core competencies and strengths especially in the gold loan portfolio. The key levers and enablers that are in place/WIP include verticalisation, good governance structure, sound risk management practices, growth-oriented policies, geographic expansion, customer centric processes, strong and experienced leadership team, implementation of new CBS etc. The setting up of the Service Governance Council is aimed towards ensuring the right culture and mindset among the team members. On the leadership front, your Bank is having a team with relevant experience to build and scale the franchise with long-term vision and commitment. Your Bank is aiming for a Pan India presence by shedding its image of a Regional Player and during FY 2023-24, 76 new branches were opened taking the total branch network to 779. Bank has 731 ATMs as on March 31, 2024, as against 528 in the previous year. On the technology front, your Bank has kick started the Core Banking Migration Project including OGL and OFSAA rollouts. Your Bank is undertaking a complete transformational journey on the tech side with a motto of “Incremental to Transformational” mindset with active participation from all the teams. Currently, the Bank is putting in place the basic platforms like Loan Origination System (LOS), Lead Management System (LMS), product management tool, liability systems, payment/ channel systems, cyber security etc. The digital journey is picking up pace as the tech platform is getting ready. The roll out of the first phase of the new CBS is expected in H2 of FY 2024-25, which will benefit immensely by way of universal financial solutions, holistic view of customers, Omni channel delivery, simplified & centralised processes, reduced operational expenses etc. Once the migration work is completed, the scale up phase will gain momentum in alignment with the vision set forth as part of SBS journey.

PERFORMANCE OVERVIEW

During the period under review, your Bank continued to deliver on stakeholder expectations both in terms of topline and bottom line and registered a net profit of '' 566.82 crore. Overall growth was backed by 20% business growth, 18% net loan book growth, and 21% deposit growth. Your Bank was able to grow faster than the average industry growth trend in terms of deposits and advances.

In the Financial year 2023-24, the total income grew by '' 876.17 crore to '' 3,511.83 crore from '' 2,635.66 crore in the corresponding previous financial year. During the same period, Interest Income increased by '' 607.89 crore to '' 2,927.54 crore from '' 2,319.65 crore and Non-Treasury Other Income Increased by '' 223.07 crore to '' 536.64 crore from '' 313.57 crore in the corresponding previous financial year. During the same period, Net Treasury Income increased by '' 45.21 crore to '' 47.65 crore from '' 2.44 crore in the corresponding previous financial year.

During FY 2023-24, the total Operating Profit of the Bank increased by '' 72.52 crore to '' 779.92 crore from '' 707.40 crore and Net Profit increased by '' 19.46 crore to '' 566.82 crore from '' 547.36 crore in the corresponding previous financial year. The profit came in the backdrop of a strong growth in net interest income (NII). Non- interest income, backed by processing fee, commissions on selling third party products and charges collected from deposit accounts.

In the same period, the Bank''s gross advances grew by '' 3,730.08 crore to '' 24,571.75 crore led by 82% growth in retail loan to '' 2,115 crore from '' 1,162 crore, 28% growth in SME/MSME to '' 3,200 crore from '' 2,507 crore and 22% growth in gold loans to '' 11,818 crore from '' 9,694 crore.

Deposits grew by '' 5,212.99 crore to '' 29,718.80 crore from '' 24,505.81 crore in the corresponding previous financial year.

Gross non-performing assets (GNPAs) increased by '' 98.51 crore to '' 361.07 crore as on March 31, 2024, from '' 262.56 crore as on March 31, 2023. Net non-performing assets (Net NPAs) increased by '' 53.08 crore to '' 124.90 crore as on March 31, 2024, from '' 71.82 crore as on March 31, 2023. The gross NPA as percentage of advances increased by 21 basis points to 1.47% as on March 31, 2024 as against 1.26% as on March 31, 2023. Net NPAs increased by 16 basis points to 0.51% as of March 31, 2024, from 0.35% as on March 31, 2023. Provision Coverage Ratio (including write-off) stood at 86.44% at the end of the financial year as against 92.11% in the corresponding previous financial year.

Total Assets have increased by '' 6,893.71 crore and stood at '' 36,055.99 crore as on March 31, 2024, as against

'' 29,162.28 crore as on March 31, 2023. Net Advances have increased by '' 3,684.93 crore and stood at '' 24,335.58 crore as on March 31, 2024, as against '' 20,650.65 crore as on March 31, 2023.

FINANCIAL PERFORMANCE

Net Interest Income (NII) increased to '' 1,476.41 crore in FY 2023-24, from '' 1,333.85 crore in FY 2022-23. Non-Treasury Other Income increased to '' 536.64 crore in FY 2023-24 from '' 313.57 crore in FY 2022-23. Net Treasury Income also increased to '' 47.65 crore in FY 2023-24, from '' 2.44 crore in FY 2022-23.

Provisions other than taxes decreased by '' 44.69 crore from '' (26.21) crore to '' 18.48 crore. The Operating Profit for the FY 2023-24, was '' 779.92 crore before taxes and provisions as against '' 707.40 crore in the FY 2022-23 mainly on account of increased net interest income and other income excluding treasury profits.

The Net Profit for the FY 2023-24, was '' 566.82 crore as compared to a Net Profit of '' 547.36 crore in the FY 2022-23.

DIVIDEND

Your Bank has formulated the Dividend Distribution Policy as per the requirements of Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("SEBI Listing Regulations”) and guidelines issued by Reserve Bank of India.

The objective of the Policy is to lay down the criteria to be considered by the Board, before recommending dividend to its shareholders, whether it be Interim/Special Dividend or Final Dividend. The Bank believes in optimising the shareholder''s wealth by offering them various corporate benefits from time to time after considering the Capital to Risk (Weighted) Assets Ratio (CRAR) and reserve requirements subject to regulatory stipulations.

Though the Bank posted a highest ever net profit in its history during the financial year under review, with the object of conserving profits in the form of reserves for future expansion plans as well as strengthening its balance sheet, your directors do not propose to recommend any dividend for the financial year ended March 31, 2024.

The Dividend Distribution Policy is available on the Bank''s website at https://www.csb.co.in/sites/default/files/annexure-IX 17 dividend distribution policv.pdf.

CHANGE IN THE NATURE OF BUSINESS

During the financial year under review, there has been no change in the nature of business of the Bank.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE BANK

There are no material changes and commitments affecting the financial position of the Bank which has occurred between the end of the financial year of the Bank i.e., March 31, 2024 and the date of the Directors'' Report.

CAPITAL STRUCTURE

The Authorised share capital of the Bank stood at ''220.00 crore divided into 22 crore equity shares with a face value of '' 10/- each as on March 31, 2024. During the financial year under review, there has been no change in the Authorised share capital of the Bank.

The Paid-up Equity Capital of the Bank stood at ''173.49 crore comprising 17,34,85,827 fully paid-up Equity Shares of ''10/- each as on March 31, 2024. The Bank has not allotted any shares during the FY 2023-24, and as a result, the paid-up capital of the Bank remains unchanged, i.e., ''173.49 crore, in the said period.

RESERVES

The free reserves and surplus stood at '' 2,736.63 crore as on March 31, 2024, as against ''2,309.41 crore as on March 31, 2023.

The Bank''s Net owned funds grew to '' 3,563.64 crore from '' 2,964.10 crore as of the previous financial year, and market capitalisation stood at '' 7,000.15 crore as on March 31, 2024 as against '' 4,252.14 crore as on March 31, 2023.

CAPITAL ADEQUACY RATIO

The Bank''s overall Capital Adequacy Ratio (CRAR) under Basel III stood at 24.47% at the end of fiscal 2024, well above the benchmark requirement of 11.50% stipulated by Reserve Bank of India. Of this, the Common Equity Tier I (CET I) CRAR was 23.10% (against minimum regulatory requirement of 8.00%) and Tier I CRAR was 23.10% (against minimum regulatory requirement of 7.00%). As on March 31, 2024, the Bank''s Tier II CRAR under Basel III stood at 1.37% as against 1.23 % as on March 31, 2023.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Board of Directors, to the best of its knowledge and ability, confirm that;

a. In the preparation of the annual accounts for the financial year ended March 31, 2024, the applicable accounting standards had been followed along with proper explanation relating to material departures.

b. The directors have 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 2023-24 and of the profit and loss 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, 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, 2024 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 were operating effectively.

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.

PROMOTER HOLDING - FIH MAURITIUS INVESTMENTS LTD

FIH Mauritius Investments Ltd (FIHM), the promoter of the Bank holds 49.72 % of the paid-up capital of the Bank in line with Reserve Bank of India Master Direction, viz., (Acquisition and Holding of Shares or Voting Rights in Banking Companies) Directions, 2023 (“Master Direction”) read with Reserve Bank of India Guidelines on Acquisition and Holding of Shares or Voting Rights in Banking Companies (“Guidelines”), dated January 16, 2023. FIHM holding in the Bank is subject to dilution schedule as mandated by Reserve Bank of India as part of the terms of the approval and the relevant RBI guidelines as applicable, from time to time, subject to the permission to hold 26% in the paid-up equity capital of the Bank beyond 15 years from the date of completion of investments. There is no change in the promoter holding during the financial year under review.

Pursuant to Section 12(2) of Banking Regulation Act and a Gazette Notification no. DBR.PSBD. No. 1084/16.13.100/2016-17 dated July 21, 2016, read with Guidelines dated January 16, 2023, voting rights of FIHM is currently capped at 26% of the total voting rights of the Bank.

DISCLOSURE OF CERTAIN TYPE OF AGREEMENTS BINDING THE BANK

The Bank has entered into an Investment Agreement (“Agreement”) dated February 20, 2018, with FIH Mauritius Investments Ltd (FIHM), the promoter of the Bank, which was superseded and replaced by Amended and Restated Investment Agreement dated October 15, 2018, read with Addendum No. 1 dated October 19, 2020 (“Addendum”) to the Amended and Restated Investment Agreement dated October 15, 2018. The salient features of the agreement in terms of Regulation 30A of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 read with clause 5A of paragraph A of Part A of Schedule III of the SEBI Listing Regulations is as follows:

Subject to the terms of the Investment Agreement, FIHM is entitled to the following rights:

[For the purpose of this disclosure, the term ‘Investor’ wherever mentioned should mean ‘FIH Mauritius Investments Ltd’, the promoter of the Bank.]

Board Composition. Unless otherwise agreed to in writing by the Bank and the Investor, the Board of Directors shall consist of a maximum of 11 (eleven) Directors, including the Investor Directors. The majority of the Board of Directors shall be independent directors. The maximum number of 11 (eleven) Directors does not include the directors appointed by the RBI, if any pursuant to Section 36AB of the Banking Regulation Act, 1949. Not less than 51% (fifty one per cent) of the total number of Directors on the Board of Directors shall be persons who satisfy the conditions laid down in Section 10A(2) of the Banking Regulation Act, 1949.

Investor Directors. For as long as the Investor holds such number of Equity Securities as represents 12% (twelve per cent) of the Equity Share Capital on a Fully Diluted Basis, the Investor shall have the right to nominate to the Board of Directors, up to 4 (four) Directors (collectively, the "Investor Directors”). The Investor Directors nominated to the Board will be required to comply with such provisions as may be applicable to Non-Executive Directors of a banking company in India under applicable Law. The Investor Directors, if required to retire by rotation under the Act, shall be required to retire by rotation and shall be eligible for re-appointment to the Board in accordance with the provisions of the Act.

Anti-Dilution. Notwithstanding anything contained under this Agreement and unless otherwise agreed to in writing by the Bank and the Investor, the Bank shall not, at any time after the Completion Date and until the Fall Away Date, issue any Equity Securities of any type or class to any Person ("Proposed Issuance”) unless the Bank has offered

the Investor the right to subscribe for up to such number of Equity Securities as would result in the percentage of the Investor''s shareholding in the Bank immediately following the completion of the Proposed Issuance, on a Fully Diluted Basis, being maintained at the same percentage as the percentage of the Investor''s shareholding in the Bank immediately prior to the completion of the Proposed Issuance, on a Fully Diluted Basis ("Investor''s Pro Rata Share”), in accordance with the provisions of the articles of association of the Bank, Section 12B of the Banking Regulation Act, 1949, and master directions and circulars issued by the RBI, from time to time, on shareholding and voting rights of shareholders in private sector banks. The Investor may, subject to applicable Law, rules and regulations, choose to exercise such right itself or through renunciation in favour of an Affiliate.

Issuance of Equity Shares pursuant to the ESOP Plans. In the event that the Bank proposes to issue any Equity Shares pursuant to the exercise of any Employee Stock Options under the ESOP Plans, such issuance of Equity Shares shall also be deemed a Proposed Issuance, and the Bank shall be required to comply with the relevant clauses of Investment Agreement, provided that in such instance, the price at which the Investor shall be entitled to subscribe to the Investor''s Pro Rata Share of the Proposed Issuance shall be the fair market value of such Equity Shares.”

Committee Composition. For as long as the Investor holds such number of Equity Securities as represents 12% (twelve per cent) of the Equity Share Capital on a Fully Diluted Basis, the Investor shall have the right to nominate an Investor Director to be a member of each committee constituted by the Board ("Committees”). The relevant provisions shall apply mutatis mutandis to all Committees constituted by the Board, and all meetings of such Committees. Any Committees required to be constituted by the Board under Applicable Law shall be so constituted in the manner required under Applicable Law.

Nomination & Remuneration Committee.

(a) The Board shall re-constitute its nomination and remuneration committee (“NRC”) to provide that, for as long as the Investor holds such number of Equity Securities as represents 12% (twelve per cent) of the Equity Share Capital on a Fully Diluted Basis, at least one of the members of such NRC shall be an Investor Director.

(b) For as long as the Investor holds such number of Equity Securities as represents 12% (twelve per cent) of the Equity Share Capital on a Fully Diluted Basis (i) all decisions in relation to the appointment, termination or replacement of any Directors, key managerial personnel

(as defined under the Act), officers or senior executives of the Bank, or any alteration in the terms of their appointment or engagement (“NRC Matters”), shall, require an approval from a majority of the members of the NRC; and (ii) any matter which constitutes an NRC Matter may only be tabled for the Board for consideration if such matter has first been tabled before the NRC, approved by the NRC and thereafter referred to the Board for approval by the NRC.

Reporting requirements: Ongoing annual and quarterly reporting requirements relating to financial statements (in accordance with IFRS), certifications from CEO and CFO relating to internal controls, business performance reports and any other financial information as required to be disclosed to Fairfax India Holdings Corporation (“FIHC”) for regulatory filings by FIHC and / or any of its affiliates under Canadian securities laws or as may be deemed necessary by FIHC or FIHM.

The agreement entered with FIHM is hosted at https://www. csb.co.in/pdf/Reg30FIHMAgreement

The Bank has not entered into any other subsisting material agreement, other than in the ordinary course of business. Further, neither the shareholders, promoters, promoter group entities, related parties, directors, key managerial personnel, employees of the Bank, have entered into an agreement among themselves or with the Bank or with a third party, solely or jointly, which, either directly or indirectly or potentially or whose purpose and effect is to, impact the management or control of the Bank or impose any restriction or create any liability upon the Bank.

QUALITY INITIATIVES

Bank focuses on maintaining highest standards of quality through innovative technology platforms thereby ensuring superior services to customers and other stakeholders. Bank is having ISO 27001:2013 certification for Information Technology, Information Security, Primary and Secondary and Near Disaster Recovery Centres.

CSB Institute of Learning & Development (CSBILD) has achieved a remarkable milestone with 100% of employees trained in various online, campus, and external programs. For the fiscal year 2023-24, the total training hours for all employees was 1,97,259.56 with a per-person learning average of 25.09 hours. For male employees, this average was at 24.53 hours and 26.30 hours for females.

Among the various initiatives undertaken in the current financial year, CSBILD introduced ‘Neev'', a structured onboarding program lasting 5 days, held every first day of the week for new joiners. CSB Institute of Learning &

Development (CSBILD) has retained its ISO 9001:2015 certification obtained during the previous financial year.

CREDIT RATINGS OF DEBT INSTRUMENTS

CRISIL, vide letter dated May 22, 2024, has reaffirmed the rating ‘CRISIL A1 '' to the '' 2,000 crore Certificate of Deposits Programme and '' 2,000 crore Short Term Fixed Deposits Programme of the Bank.

CRISIL, vide letter dated May 22, 2024, has reaffirmed ‘CRISIL A /Stable'' rating to the proposed '' 500 crore Tier II, Basel III compliant bonds issue Programme of the Bank.

India Ratings and Research, vide letter dated August 17, 2023, has reaffirmed its rating of ‘IND A'' with Outlook Stable, to the proposed '' 500 crore Tier II, Basel III compliant bonds issue Programme of the Bank.

The Bank has not yet issued any bonds as part of the programme.

The further details of all credit ratings obtained by the Bank along with revisions thereto, if any, during fiscal 2024, for all the debt instruments outstanding as on March 31, 2024, are provided in the Report on Corporate Governance, forming part of this annual report.

DEPOSITS ISSUANCE PROGRAMME

During the period under review, your Bank raised '' 2,910 crore (FV) under the Certificate of Deposits programme from various mutual funds and banks, and out of the same, the outstanding as on March 31, 2024, was '' 1,030 crore (FV). The Bank has not raised deposits under the Short Term Fixed Deposits Programme during the period under review.

ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS

As on the date of this Report, the Bank has not issued any equity shares with differential voting rights.

ISSUE OF SWEAT EQUITY SHARES

As on the date of this Report, the Bank has not issued any sweat equity shares.

EMPLOYEES STOCK OPTION SCHEME CSB Employees Stock Option Scheme 2019

The Bank, on receipt of approval of the shareholders by postal ballot on May 04, 2019, formulated and adopted a stock option scheme called "CSB Employees Stock Option Scheme 2019” ("ESOS 2019” or "Scheme”). The Scheme is in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014 which was subsequently

repealed and replaced with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.

The scheme is intended to enable the employees, present and future, to get a share in the value that they help to create for the organisation over a period of time, aligning the objectives of an individual with those of the Bank as well as to attract and retain critical senior talents with Employee Stock Options as a compensation tool.

The Scheme shall be administered through an employee stock option trust (“ESOS Trust”) in the nature of an irrevocable employee welfare trust in due compliance with the applicable laws.

Under the Scheme, 8,63,972 stock options were granted in the FY 2023-24. All the options were granted at market price, to be vested subject to the vesting conditions/ malus and claw back arrangements and be exercised within the period as per the terms of the grant and the Scheme.

During the period under review, 4,96,537 options were vested in line with the vesting schedule. In the same period 5,97,318 options were exercised by the grantees, which includes 1,00,781 options that were vested in the previous period. In the same period, 45,672 options were lapsed prior to its vesting schedule due to the resignation/separation of employment by the grantees. As on March 31, 2024, the number of options in force is 23,53,456 of which 1,87,957 are vested options.

Pursuant to the approval received from Reserve Bank of India on May 4, 2023, the Nomination & Remuneration Committee of the Board on May 10, 2023, granted 13,145 stock options to Mr. Pralay Mondal, Managing Director & CEO, at an exercise price of '' 293.80 per option, for the period from February 17, 2022 to September 14, 2022, he held the position of Deputy Managing Director of the Bank.

Pursuant to the approval received from Reserve Bank of India on December 20, 2023, the Nomination & Remuneration Committee of the Board on January 08, 2024, granted 39,123 stock options to Mr. Pralay Mondal, Managing Director & CEO, at an exercise price of '' 407.50 per option for the performance period from September 15, 2022 to March 31, 2023.

Amendment proposed in the CSB Employees Stock Option Scheme 2019

No amendment is proposed to the CSB Employees Stock Option Scheme 2019 in the ensuing Annual General Meeting of the Bank.

CSB Employees Stock Option Scheme - Statutory Compliance

A Certificate of Secretarial Auditors of the Bank pursuant

to Regulation 13 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, that the CSB Employees Stock Option Scheme 2019 has been implemented in the Bank in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, and the resolution passed by the Shareholders for the Scheme, will be placed to the Annual General Meeting for the scrutiny of Shareholders.

The statutory disclosures as required as per rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 and Regulation 14 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, are given on the website of the Bank at www.csb.co.in which forms part of this report as Annexure-I.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

CSB Bank''s century-long legacy is steeped in trust, ethics, and transparency. Throughout its history, the Bank has prioritised serving the needs-based sections of society, by delivering banking services responsibly and transparently. This unwavering commitment has made a significant impact on the communities it serves. While maintaining focus on its core business, CSB Bank consistently emphasises environmental, social, and governance concerns, evident in its approach and activities. Upholding exemplary corporate governance standards, the Bank ensures transparency and disclosure as fundamental principles.

The Bank in compliance with Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”) read with the SEBI circular no. SEBI/HO/CFD/CFD - SEC - 2/P/ CIR/2023/122 dated July 12, 2023, presents the Business Responsibility and Sustainability Report (BRSR) of the Bank for the FY 2023-24, being the third report of its kind, in the format as specified by SEBI, describing the initiatives taken by the Bank from an environmental, social and governance perspective, forms part of this Report as Annexure-II.

The Report indicates the Bank''s performance against the nine principles of the ‘National Guidelines on Responsible Business Conduct''. Reporting under each principle is divided into essential and leadership indicators. The essential indicators are required to be reported on a mandatory basis while the reporting of leadership indicators is on a voluntary basis.

The report has also been hosted on the website of the Bank and can be accessed at https://csb.co.in/investor-relations>General meetings>Annual General Meeting-2024.

BUY-BACK OF SHARES OR PROVISION OF FINANCIAL ASSISTANCE FOR PURCHASE OF THE BANK’S SHARES

The Bank has not effected any buy-back of its shares or provided any financial assistance for purchase of its shares, to any persons including directors and employees of the Bank in terms of Section 67 of the Companies Act, 2013.

DISCLOSURE RELATED TO DETAILS OF DEPOSITS ACCEPTED

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

SUBSIDIARIES AND ASSOCIATES

Your Bank does not have any subsidiaries, joint ventures or associate companies.

There are no companies which have become or ceased to be its subsidiaries, joint ventures or associate companies during the year under review.

Bank has formulated a Policy for determining material subsidiaries pursuant to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same is displayed on the website of the Bank at:https://www.csb.co.in/pdf/Annexure-I_Policy_ for_Determining_Material_Subsidiaries_15072024.pdf

RISK MANAGEMENT POLICY

The Bank has a comprehensive policy framework which contains separate policies for identification, measurement, monitoring & control and mitigation of all material risks including but not limited to credit, market, operational, liquidity and other Pillar- II risks. The Bank has put in place an integrated risk management policy which ensures independence of the risk governance structure. IRMD Charter is included in the Integrated Risk Management policy. The risk management policy details the principles, rules and guidelines to be adopted by the Bank for managing and controlling various kinds of risks through various subpolicies. The policies are implemented in an uninterrupted, reliable and comprehensive manner across the entire Bank. The details of risk management practices are provided in the Management Discussion and Analysis Report annexed to the Director''s Report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

A set of Policies, that include Fraud Risk Management Policy, Whistle Blower Policy and Anti-Bribery & Anti-Corruption Policy, are devised and formulated by the Vigilance

Department as part of its ongoing Vigilance mechanism. These are scrupulously followed, for surveillance, control, and monitoring of day-to-day activities, in order to prevent frauds and thereby manage the risk of eventual financial loss or damage to the reputation of the Bank. These policies are in tune with the directions of RBI, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Companies Act, 2013 and SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended.

One such policy, the Whistle Blower policy is an effective tool to report concerns regarding unethical behaviour, violation of systems & procedures, questions of law, wrong business practices or grave misconduct by the employees. As per this Policy /Mechanism, all stake holders viz. Directors and Employees of the Bank, Customers, Non-Governmental Organisations (NGO) and others can lodge complaints. It is published on the Website of the Bank to create awareness amongst all the stake holders. The Audit Committee of the Board (ACB) oversees the vigil mechanism through its committee processes. The Chairman of ACB directly hear grievances/ victimisation of employees, who use this mechanism to report such genuine concerns. No employee who is aggrieved is denied access to ACB under this policy. It provides reassurance/protection to the whistle blower from victimisation, discrimination or reprisals for having blown the whistle, in good faith and in the interest of the Bank. The investigation under this policy shall be completed within 60 days from the date of receipt of the complaint and the report thereof should be placed before the ACB.

As part of the awareness program, the said Policies as well as the Ethics & Code of conduct for staff, are included in every session of the training programme conducted at the Bank''s staff Training College, for enhancing awareness of fraud risk and for promoting a culture of compliance amongst the employees.

Similarly, another policy devised as part of the said Vigilance mechanism is the Fraud Risk Management policy. Under this policy every instance of fraud reported, is thoroughly investigated. It ensures that all the systems and procedures are scrupulously followed by all its employees. Bank is taking stringent action against those employees who fail to comply with the instructions of the Bank. Deficiencies/ irregularities/Lacunae in the system and procedures, if any observed during the investigation, are plugged and wherever necessary systemic corrections are suggested and placed before the ACB, for necessary directions. Further, with regard to the irregularities committed, the concerned branch officials are suitably cautioned so that such deficiencies do not recur, and incidents of frauds are prevented. Vigilance Department issues Caution Note

on a regular basis that create awareness with regard to the different modus operandi adopted by the fraudsters, including those that have occurred in our Bank. This enables the Branches / Offices to prevent similar kind of fraudulent attempts in future. This policy is reviewed every year by the Board and suitably amended, as required. A reference to the Whistle Blower Policy/Vigil Mechanism is also made in every caution note issued by the Vigilance Department.

Further the Anti-Bribery and Anti-Corruption Policy ensures that the stakeholders including Employees (whether full-time or contractual, including trainees and interns), Directors, Agents, Associates, Vendors, Consultants, Advisors, Representatives, or Intermediaries do not indulge in any act of ‘Bribery'' or ‘Corruption'' while discharging their official duties, either in their own name or in the name of the Bank.

As part of the preventive mechanism, the department also undertakes Preventive Vigilance Audits, to ensure that all the checks and balances are in place. This promotes a culture of compliance amongst its employees. Moreover, the Bank is making all out efforts to prevent frauds by strengthening the existing control measures and by reiterating the systems and procedures, to update and alert its employees. Bank has a well-organised Inspection Department which conducts regular and comprehensive Inspection (RBIA) of branches and offices at specified intervals and also oversees all other Audits and Inspection of the Bank. The Bank is taking several measures to plug the gaps in the areas of appraisal, monitoring, internal systems, etc., to strengthen the overall control system on loan assets. The Bank has strengthened the internal audit system, functions of vigilance department and put in place an appropriate mechanism, information system to prevent recurrence, early detection of frauds on an ongoing basis.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to the provisions of Regulation 34(2)(e) of the SEBI Listing Regulations, the Management Discussion and Analysis Report for the year under review is provided in a separate section forming part of this Report as Annexure - III.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Bank has designed and implemented adequate procedures and internal control systems which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements. For the year ended March 31, 2024, the Board is of the opinion that the Bank has sound Internal Financial Controls to commensurate with the nature and size of its business operations wherein controls are in place and operating effectively and no material weaknesses exist.

Bank is operating in a fully computerised environment with Core Banking System supported by diverse application platforms for handling special business such as treasury, trade finance, retail loans, etc. The process of recording transactions in each application platform is subject to various forms of control such as in-built system checks, maker - checker authorisations and independent post transaction reviews. The financial statements are prepared based on computer system outputs. Responsibility of preparations of financial statements is entrusted to a dedicated unit which is independent of business.

For mitigating risks and for KYC norms compliance, the Bank has put in place centralised processing for opening of CASA accounts and modifications in customer information. For login to CBS, in addition to login passwords, f inger-scan-authentication is implemented and as control measure, dual custody for cash and gold are in place in all branches.

The Bank has a process in place to continuously monitor the existing controls and identify gaps, if any, and implement new and/or improved controls wherever the effect of such gaps would have a material effect on the Bank''s operation. During the year under review, there are no material or serious observations of inefficiency or inadequacy of such controls observed/reported.

CORPORATE GOVERNANCE

The Bank continues its endeavor to adopt the best prevalent corporate governance practices. A separate section/ Report on corporate governance standards followed by your Bank and the relevant disclosures as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013 and the rules made thereunder are incorporated in the Corporate Governance Report that forms part of this Report.

A certificate from Bhandari & Associates, Company Secretaries, Mumbai, confirming compliance to the conditions of Corporate Governance as stipulated under SEBI Listing Regulations is annexed to this Report as Annexure - IV.

UPDATE ON IND AS IMPLEMENTATION

Reserve Bank of India (RBI) vide press release RBI/2018-2019/146 DBR.BP.BC.No.29/ 21.07.001/2018-19, dated March 22, 2019, advised all scheduled commercial Banks about deferment of implementation of Ind AS till further notice in the context of legislative amendments recommended by RBI on implementation of Ind AS were under consideration of the Government of India.

The implementation of Ind AS is expected to result in significant changes to the way the Bank prepares and presents its financial statements. The key impact areas during the implementation of Ind AS for the Bank include impairment requirements of Financial Instruments based on Expected Credit Loss, interest recognition using effective interest method and Fair valuation of financial assets.

As directed by the RBI, the Bank is submitting half yearly Proforma Ind AS financial statements within the stipulated timeline.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE BANK

Pursuant to Section 186 (11) of the Companies Act, 2013, the provisions of Section 186 of Companies Act, 2013, except sub - section (1), do not apply to a loan made, guarantee given or security provided or any investment made by a banking company in the ordinary course of business, hence being excepted from disclosure requirements under Section 134(3)(g) of the said Act.

The particulars of investments made by the Bank are disclosed in Schedule 8 of the financial statements as per the applicable provisions of the Banking Regulation Act, 1949.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Your Bank has obtained prior approvals of the Audit Committee, the Board, and the members of the Bank via postal ballot /at the annual general meeting for all related party transactions/material related party transactions. Your Bank has obtained the omnibus approval of the Audit Committee for those transactions with related parties that are repetitive in nature. Further, the Audit Committee of the Board has reviewed all the transactions with the related parties on a quarterly basis.

No transactions were entered into with related parties, which were not in the ordinary course of the business of the Bank or which were not on an arm''s length basis.

During fiscal 2024, the Bank has not entered into any materially significant transactions with its related parties, which could lead to potential conflict of interest between the Bank and these parties, other than transactions entered into with them in the ordinary course of its business.

The particulars of contracts or arrangements with related parties entered into during the period under review in terms of Section 188(1) of the Companies Act, 2013, are provided in Form AOC-2 as Annexure -V in terms of 134(3)(h) of the Companies Act, 2013.

The ‘Policy on materiality of Related Party Transactions and on dealing with Related Party Transactions'' has been reviewed by the ACB and the Board and the same is available on the website of the Bank at https://www.csb. co.in/pdf/Annexure-II__Policy_on_dealing_with_Related_ Party_Transaction_15072024.pdf

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Bank acknowledges society as a primary stakeholder and consistently places Corporate Social Responsibility (CSR) activities at the forefront of its priorities. The Bank''s CSR policy is designed with the primary goal of integrating CSR as a crucial business process for the sustainable development of society. This policy functions as a guiding document, assisting in the identification, execution and monitoring of CSR projects, all in alignment with the spirit of the statute.

I n the FY 2023-24, the Bank budgeted a total of '' 10.82 crores for CSR activities, a significant increase from '' 6.72 crore in the previous FY 2022-23. Of this budget, '' 7.03 crore was expended on various CSR initiatives. The remaining '' 3.79 crore has been earmarked for Project Dialysis, a venture undertaken by the Fairfax India Charitable Foundation. This project is set to be an ongoing commitment of the Bank.

The Project Dialysis conducted by Fairfax India Charitable Foundation aims in providing affordable, quality dialysis services to patients in various parts of India where the services are limited/non-existent for dialysis infrastructure. The project was initially approved by the Board as a onetime arrangement with a contribution of '' 2.98 crores, however due to unforeseen reasons the project was slightly impleaded and the foundation was able to spend '' 2 crore only. The Bank, hence, on request of the foundation, decided to classify the project as an ongoing project with an additional contribution of '' 2.81 crore which is proposed to be completed on or before March 31, 2025. The unspent amount of '' 3.79 crores pertaining to the said ongoing projects were transferred to Unspent CSR account on April 15, 2024, which will be released in a phased manner up on receipt of request from the foundation or based on the progress of the project on or before March 31, 2025.

The projects identified by the Bank spread across areas such as healthcare, sanitation, education, housing, gender equality etc., as per the annual action plan approved by the Corporate Social Responsibility Committee and the Board of the Bank. As a responsible citizen, the Bank will persist in implementing a slew of measures to honour its commitment to society at large.

The Annual Report on Corporate Social Responsibility Activities of the Bank for the FY 2023-24, has been provided in Annexure - VI to this report.

The Corporate Social Responsibility Policy as recommended by the CSR Committee and as approved by the Board is available on the website of the Bank and can be accessed at https://www.csb.co.in/sites/default/files/annexure-IN_3_ csr_policy.pdf.

AUDITORS

a) Statutory Auditors

The members of the Bank in the 102^nd Annual General Meeting of the Bank held on August 08, 2023, approved the appointment of Walker Chandiok & Co LLP, Chartered Accountants, Mumbai as one of the Joint Statutory Auditors of the Bank, to hold office from the conclusion of 102^nd Annual General Meeting till the conclusion of the 105^th Annual General Meeting of the Bank.

Mukund M. Chitale & Co., Chartered Accountants, Mumbai was the other Joint Statutory Auditors of the Bank to audit the accounts for the financial year ended March 31, 2024 and the Bank obtained approval of the shareholders for their appointment in the 100^th Annual General Meeting held on August 12, 2021, to hold office from the conclusion of 100^th Annual General Meeting till the conclusion of the 103^rd Annual General Meetings of the Bank.

Bank in terms of Section 30(1A) of the Banking Regulation Act, 1949, obtained approval of Reserve Bank of India for the appointment of Mukund M. Chitale & Co, Chartered Accountants, Mumbai and Walker Chandiok & Co LLP, Chartered Accountants, Mumbai as the Joint Statutory Central Auditors of the Bank for the FY 2023-24.

As per Reserve Bank of India Guidelines No. DoS. CO.ARG/SEC.01/08.91.001/2021-22 dated April 27, 2021, regarding "Appointment of Statutory Central Auditors (SCAs)/Statutory Auditors (SAs) in Commercial Banks (excluding RRBs), UCBs and NBFCs (including HFCs)” read with FAQ dated June 11, 2021 and the Bank''s policy with regard to Appointment of Statutory Auditors, Mukund M. Chitale & Co, Chartered Accountants, Mumbai, who will be completing continuous tenure of three (3) years as the Statutory Auditors of the Bank in the ensuing Annual General Meeting, will not be eligible for re-appointment in terms of the said guidelines and in their place, the Board on recommendation of the Audit Committee

of the Board, recommends the appointment of Sundaram & Srinivasan, Chartered Accountants, Chennai as the Joint Statutory Auditors of the Bank, to hold office from the conclusion of 103^rd Annual General Meeting till the conclusion of the 106^th Annual General Meeting of the Bank, subject to the specific approval of Reserve Bank of India for each year during their tenure in terms of Section 30(1A) of the Banking Regulation Act, 1949.

Bank in terms of Section 30(1A) of the Banking Regulation Act, 1949, obtained approval of Reserve Bank of India for appointment of Walker Chandiok & Co LLP, Chartered Accountants, Mumbai together with Sundaram & Srinivasan, Chartered Accountants, Chennai as the Joint Statutory Auditors of the Bank for the FY 2024-25 for their 2^nd year and 1^st year in the office, respectively.

Pursuant to the amendment made to Rule 3 of the Companies (Audit and Auditors) Rules, 2014 via the Companies (Audit and Auditors) Amendment Rules, 2018, effective from May 07, 2018, the requirement of seeking ratification of the members for the reappointment of the Statutory Auditors has been withdrawn from the Statute. Hence, ratification of the members for re-appointment of Walker Chandiok & Co LLP, Chartered Accountants, Mumbai as one of the Joint Statutory Auditors of the Bank at the ensuing Annual General Meeting is not being sought for. However, the Bank will continue to seek approval of the shareholders for payment of fees/ remuneration to the Auditors on a yearly basis though approval of the shareholders be sought for their appointment for a period of three years together, in line with the extant guidelines.

Pursuant to the Regulation 33(1) (d) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Joint Statutory Auditors have confirmed that they are subjected to the peer review process of the Institute of Chartered Accountants of India (ICAI) and that they hold a valid certificate issued by the Peer Review Board of ICAI.

The Board places on record their appreciation and gratitude to Mukund M. Chitale & Co., Chartered Accountants, Mumbai, for the valuable services rendered by them as Statutory Auditors of the Bank.

b) Independent Auditors’ Report

The Joint Statutory Auditors of the Bank viz., Mukund M. Chitale & Co, Chartered Accountants, Mumbai and Walker Chandiok & Co LLP, Chartered

3.	Parties involved, if remedial action not taken; and	Branch officials
4.	Remedial actions	Regular training/orientation
	taken.	are given to the branch officials in order to update them on the internal processes and policies. Policies/SOPs/ guidelines etc. are amended suitably from time to time to plug loopholes in the system, if any. Branch officials are advised/cautioned to exercise due diligence while undertaking day-today business transactions. Preventive vigilance Audits, surprise checks, etc. are being undertaken on a regular basis to detect irregularities at an early stage, which helps with early rectifications. Caution notes, advice, circulars, etc. are issued periodically to create awareness amongst the employees from falling prey to such frauds/ perpetrators. The employees are encouraged to make use of the "Whistle Blower Policy”, whereby the officials are encouraged to bring to light the irregularities/ violations noticed by them, so that such deviations are nipped in the bud. Moreover, stern action is being initiated against those employees who violate extant policies/ circulars/guidelines/SOPs of the Bank, in order to create a sense of deterrence.

Accountants, Mumbai, have audited the accounts of the Bank for the FY 2023-24 and their Report is annexed.

Pursuant to Section 143(3)(i) of the Companies Act, 2013, the Statutory Auditors have also reported on the adequacy and operating effectiveness of the internal financial controls system over financial reporting, which has been enclosed as “Annexure A” to the Independent Auditor''s Report.

There are no qualifications, reservations or adverse remarks made by the Statutory Auditors in their report for FY 2023-24.

c) Secretarial Auditors and Secretarial Audit Report

Pursuant to Section 204 of the Companies Act 2013, the Bank appointed Bhandari & Associates, Company Secretaries, Mumbai as its Secretarial Auditors to conduct the secretarial audit of the Bank for the Financial Year 2023-24. The Bank produced all necessary records to the Secretarial Auditors for the smooth conduct of their Audit.

The Report of Secretarial Auditors for the said period is enclosed to this report as Annexure -VII. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditors in their report for the FY 2023-24.

d) Secretarial Compliance Report

Pursuant to Regulation 24A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with circular No. CIR/CFD/ CMD1/27/2019 dated February 08, 2019, issued by SEBI, the Bank has obtained Secretarial Compliance Report for the financial year ended March 31, 2024, from Bhandari & Associates, Company Secretaries, Mumbai, the Secretarial Auditors of the Bank on compliance of all applicable SEBI Regulations and circulars/ guidelines issued thereunder and the copy of the same was submitted with the Stock Exchanges within the prescribed timelines.

e) Certificate in terms of Regulation 34(3) read with Schedule V of the SEBI Listing Regulations

In terms of Regulation 34(3) read with Schedule V of the SEBI Listing Regulations, the Bank has obtained a Certificate from Bhandari & Associates, Company Secretaries, Mumbai, confirming that none of the Directors on the Board of the Bank have been debarred or disqualified from being appointed or continuing as Directors of the companies either by the Securities and Exchange Board of India or the Ministry of

Corporate Affairs or any other Statutory / Regulatory Authorities. The said certificate is Annexed to this Report.

f) Reporting of frauds by Auditors

During financial year ended March 31, 2024, pursuant to Section 143(12) of the Companies Act, 2013, except as detailed below, neither the Statutory Auditors nor the Secretarial Auditor of the Bank have reported any instances of frauds committed in the Bank by its officers or its employees.

Walker Chandiok & Co LLP and Mukund M. Chitale & Co., statutory auditors of the Bank, vide their letter dated March 30, 2024, had reported to the Audit Committee a fraud involving an amount of '' 2.79 crore. The disclosures as required under Section 143(12) of the Companies Act, 2013, read with Rule 13 of The Companies (Audit and Auditors) Rules, 2014, is given below:

1.	Nature of Fraud with description;	The staffs of State Bank of India (‘SBI’) Gara Branch allegedly took gold packets from their branch and later pledged with different financial institutions, including CSB Bank Limited, through the main perpetrator Ponnada Tirumala Rao of Lohithakshi Loan Consultancy. The majority of the stolen ornaments were purportedly pledged at Srikakulam, Amadalavalsa, and Arasavilli Road branches of the Bank. The same was happened due to lapses on the Bank''s branch staff members in adhering to the gold loan policies of the Bank.
2.	Approximate	The aggregate loan amount
	Amount involved;	is ''2.79 crore which has
		been	reported under 55
		loan gold accounts.

COMPLIANCE TO SECRETARIAL STANDARDS

Your Bank is in compliance with the relevant Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) related to the Board Meetings (SS-1) and the General Meeting (SS-2) during the FY 2023-24. Further, the Bank has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

TRANSFER OF UN-CLAIMED/UN-PAID DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Dividend transferred to Unpaid Dividend account and remaining unpaid or unclaimed for a period of seven years from the date of such transfer, has to be transferred to Investor Education and Protection Fund as per Section 124 (5) of the Companies Act, 2013.

Since the Bank had not declared any dividends since the FY 2014-15, no amount was required to be transferred to the Investor Education and Protection Fund (the “Fund”) by the Bank for the financial year ended March 31, 2024.

All the unclaimed dividends pertaining to the prior period/ financial years were transferred to the Fund in the corresponding previous financial years within the stipulated time and in the manner as prescribed in Section 124(6) of the Companies Act, 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended from time to time.

TRANSFER OF EQUITY SHARES TO INVESTOR EDUCATION AND PROTECTION FUND AUTHORITY

In terms of the provisions of Section 124(6) of the Companies Act, 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, (as amended) and other applicable rules, notifications and circulars, if any, every company is required to transfer the shares, in respect of which dividend remains unpaid / unclaimed for a period of seven (7) consecutive years, to the Investor Education Protection Fund (IEPF) Authority.

Since the Bank had not declared any dividends since the financial year 2014-15, no shares were required to be transferred to the Investor Education and Protection Fund Authority by the Bank for the financial year ended March 31, 2024.

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is given in an Annexure and forms part of this report.

In terms of Section 136(1) of the Companies Act, 2013, the annual report and the financial statements are being sent to the members, excluding the aforesaid Annexure. The said Annexure is available for inspection at the registered office of the Bank, and any member interested in obtaining a copy of the Annexure may write to the Company Secretary of the Bank at [email protected].

BOARD OF DIRECTORS

The Bank has a broad-based Board of Directors, constituted in compliance with the Banking Regulation Act, 1949, Circulars and Guidelines issued by the Reserve Bank of India, from time to time, the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and in accordance with the best practices/principles in corporate governance adopted by the Bank.

As on the date of this report, the Board comprises of ten (10) Directors, out of which six (6) are Independent Directors, two are Non-executive, Non-Independent Directors and two are Executive Directors. The Directors possess rich experience and specialised knowledge in various areas of relevance to the Bank viz. like Agriculture, Rural Economy, Banking, Accountancy, Co-operation, Information Technology, Economics, Finance, MSME, Payment & Settlement Systems, Human Resources, Risk Management and Business Management, etc.

The Board functions as the governing body and also through various Committees constituted to oversee specific areas. Policy formulation, setting up of goals, evaluation of performance and control functions vest with the Board. The Committees have oversight of operational and supervisory issues assigned to them by the Board, from time to time.

Appointment/changes in the Board Directors of the Bank since the last Board''s Report dated June 22, 2023 and up to the date of the Report is as given under:

RE-APPOINTMENT OF NON-EXECUTIVE DIRECTORS

Director, Mr. Madhavan Menon (DIN: 00008542), liable to retire by rotation, was re-appointed at the Annual General Meeting held on August 08, 2023.

UNCLAIMED SHARE APPLICATION MONEY

There is no unclaimed Share application money pending with the Bank or to be transferred to Investor Education and Protection Fund.

COMPENSATION/ REMUNERATION POLICY

The Bank has formulated and adopted a Compensation Policy in terms of Reserve Bank of India circular no. DOR. Appt. BC.No.23/29.67.001/2019-20 dated November 04, 2019, the relevant provisions of Section 178 of the Companies Act, 2013, the relevant Rules made thereunder and the SEBI Listing Regulations. The Policy formulates the criteria for determining the remuneration and further deals with the compensation and benefits of Non-Executive Chairman, Non-Executive Directors, Managing Director & CEO, WholeTime Directors, Material Risk Takers, Control Function Staff and all other officials and employees of the Bank.

The details of the policy have been included in the Report on Corporate Governance, which forms part of this Report. The Policy was last reviewed by the Nomination and Remuneration committee and the Board in their respective meetings held on January 29, 2024.

The excerpts from compensation policy are available on the website of the Bank.

NOMINATION POLICY

The Bank has formulated and adopted Nomination policy for appointment and orderly succession of appointment of Part-time Chairman, Managing Director & CEO, Whole-time Directors, Directors, Key Managerial Personnel and Senior Management team in the Bank. The Policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of directors. The details of the same have been included in the Report on Corporate Governance, which forms part of this Report.

The Nomination Policy was last reviewed by the Nomination and Remuneration Committee and the Board in their respective meetings held on December 14, 2023 and the same is displayed on the website of the Bank at: https://www.csb.co.in/sites/default/files/annexure-VI_9_ nomination_policy.pdf

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, in respect of Directors / Employees of the Bank, is attached as Annexure - VIII to this Report.

PART-TIME CHAIRPERSON

The term of appointment of Ms. Bhama Krishnamurthy as the Part-Time Chairperson of the Bank ends on September 28, 2024, which is coterminous with her second term of appointment as Independent Director of the Bank. The Bank has initiated necessary steps for appointment of next Part-Time Chairperson of the Bank with effect from September 29, 2024.

APPOINTMENT OF INDEPENDENT DIRECTORS

1. Appointment of Ms. Renu Kohli (DIN:07981627) as an Independent Director

Pursuant to the recommendation of the Nomination & Remuneration Committee, the Board of Directors of the Bank in their meeting held on December 14, 2023, appointed Ms. Renu Kohli (DIN:07981627) as an Additional Director (Non-Executive Independent category) of the Bank w.e.f. December 14, 2023 for a period of 5 (five) years pursuant to the provisions of Section 149, 161(1) of the Companies Act, 2013 and Rules made thereunder, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”) and Article 133 of the Articles of Association of the Bank. The appointment is subject to the approval of the Shareholders of the Bank and the approval of the shareholders was obtained for the appointment of Ms. Renu Kohli as Independent Director with effect from December 14, 2023 by postal ballot resolution dated March 06, 2024.

Ms. Renu Kohli is representing ‘Majority Sector -Banking, Economics, Agriculture and Rural Economy and Small Scale Industry'' on the Board.

Opinion of the Board with regard to integrity, expertise and experience (including the proficiency) of the independent directors appointed during the year:

Board appointed Ms. Renu Kohli, as Additional Director of the Bank under "Non-Executive Independent” category based on the extensive due diligence carried out by the NRC on the declarations submitted by her in terms of fit & proper criteria and other applicable statutory guidelines issued by Reserve Bank of India from time to time.

Board noted that Ms. Renu Kohli, is an economist with research and practitioner experience on macroeconomic policies and issues. She has previously worked with the RBI, the IMF and thinktanks including ICRIER and the Institute of Economic Growth.

Adverting to the above, in the opinion of the Board, the said Independent Director appointed on December 14, 2023, possesses the requisite qualifications, proficiency, expertise, track record, integrity, independence, as well as vast and rich experience in the field of Banking.

2. Appointment of Mr. Deepak Maheshwari (DIN: 08163253) as an Additional Director (Non-Executive Independent category)

Pursuant to the recommendation of the Nomination & Remuneration Committee in their meeting held on June 11, 2024, the Board of Directors of the Bank, vide resolution passed by circulation on June 12, 2024, appointed Mr. Deepak Maheshwari (DIN: 08163253) as an Additional Director (Non-Executive Independent category) of the Bank w.e.f. June 12, 2024, for a period of 3 (three) years pursuant to the provisions of Section 149,161(1) of the Companies Act, 2013 and Rules made thereunder, SEBI Listing Regulations and Article 133 of the Articles of Association of the Bank. The said appointment is subject to the approval of the Shareholders of the Bank.

Mr. Deepak Maheshwari is an experienced banker, with a track record of building best-in-class loan portfolios at HDFC Bank and Axis Bank. Mr. Deepak Maheshwari has a solid track record in credit decision making across banking hemisphere with expert knowledge of Indian banking regulations. Mr. Deepak Maheshwari is currently in the Board of Axis Finance Limited as NonExecutive Director, and in GR Highways Investment Manager Pvt. Ltd. as Independent Director. Prior to that he was the Group Executive and Chief Credit Officer of the Axis Bank and was responsible for credit underwriting, policy and monitoring. He joined at Axis Bank after a stint of two decades at HDFC Bank, where he was Group Head of the Wholesale Credit function, responsible for asset quality, sanctions, policy, and monitoring of the entire wholesale credit portfolio of that Bank. Prior to that he had spent another two decades in SBI in various Credit and Management functions, with his last major posting being as Vice President (Credit) SBI (Canada), Toronto. Mr. Maheshwari is a B.Com. graduate and a Certified Associate of the Indian Institute of Bankers (CAIIB).

Necessary resolution seeking approval of the members in connection with appointment of Mr. Deepak Maheshwari as an Independent Director of the Bank, forms part of the notice of the ensuing Annual General Meeting. The detailed profile of Mr. Deepak Maheshwari recommended for his

appointment as Independent Director in the ensuing Annual General Meeting will be provided in the Notice of the Annual General Meeting for the benefit of shareholders as per the provisions of the Companies Act, 2013, SEBI Listing Regulations and the Secretarial Standard on General Meetings (SS-2).

Mr. Deepak Maheshwari has special knowledge/ practical experience in "Agriculture and Rural Economy, Small Scale Industry, Banking and Risk Management” and the same comes under "Majority Sector”. However, he is not eligible to represent ‘majority sector'' in view of the restriction due to his substantial interest in companies and firms in terms of Section 5(n)(e) and 10A(2)(b) of the Banking Regulation Act, 1949, even though he has special knowledge or practical experience as per Section 10A(2)(a) of the said Act.

Opinion of the Board with regard to integrity, expertise and experience (including the proficiency) of the independent directors appointed during the year:

Board appointed Mr. Deepak Maheshwari as an Additional Director of the Bank under "Non-Executive, Independent” category based on the extensive due diligence carried out by the NRC on the declarations submitted by him in terms of fit & proper criteria and other applicable statutory guidelines issued by Reserve Bank of India from time to time.

Board noted that Mr. Deepak Maheshwari is an experienced banker, with a track record of building best-in-class loan portfolios across wherever he worked. Mr. Deepak Maheshwari has a solid track record in credit decision making across the banking hemisphere with expert knowledge of Indian banking regulations.

Adverting to the above, in the opinion of the Board, the said Independent Director appointed on June 12, 2024, possesses the requisite qualifications, proficiency, expertise, track record, integrity, independence, as well as vast and rich experience in the field of Banking.

RE-APPOINTMENT OF INDEPENDENT DIRECTORS

Mr. Sudhin Bhagwandas Choksey (DIN: 00036085) was reappointed for a second term as a Non-Executive Independent Director of the Bank, at the Annual General Meeting of the Bank held on August 08, 2023, for a period of 5 (five) years commencing January 31, 2024, up to January 30, 2029 (both dates inclusive). Mr. Sudhin Bhagwandas Choksey is not liable to retire by rotation, in terms of Section 149(13) of the Act.

Mr. Sudhin Bhagwandas Choksey has special knowledge/ practical experience in banking, small-scale industry, finance, and accountancy and the same comes under "Majority Sector”. However, he is not eligible to represent the majority sector in view of the restriction due to his substantial interest in companies and firms in terms of Section 5(n)(e) and 10A(2)(b) of the Banking Regulation Act, 1949, even though he has special knowledge or practical experience as per Section 10A(2)(a) of the said Act.

APPOINTMENT OF MR. B.K. DIVAKARA AS WHOLE-TIME DIRECTOR (EXECUTIVE DIRECTOR)

Pursuant to the approval received from Reserve Bank of India on March 4, 2024 in terms of Section 35B of the Banking Regulation Act, 1949, for the appointment of Mr. B K Divakara as Whole-time Director (designated as Executive Director) of the Bank for a period of 3 (three) years with effect from taking charge, the Board of Directors of the Bank in its meeting held on March 15, 2024, on the recommendations of the Nomination & Remuneration Committee, elevated and appointed Mr. B K Divakara, Head Strategy & Corporate Legal as the Whole-time Director (designated as Executive Director) of the Bank, for a period of 3 (three) years, with effect from March 15, 2024, up to March 14, 2027 (both dates inclusive).

The approval of the shareholders was obtained on April 18, 2024, for the appointment as well as the terms, including remuneration, of Mr. B K Divakara as Whole-time Director (designated as Executive Director).

Mr. B. K. Divakara, is representing "Majority Sector -Accountancy, Agriculture and Rural Economy, Banking, Economics, Finance, Law, SSI, Risk Management and Human Resources” on the Board of the Bank.

COMPLETION OF TERM OF APPOINTMENT

Mr. Sunil Srivastav (DIN: 00237561) who was appointed as Director (Non-Executive & Independent) on the Board of the Bank for a tenure of 3 (three) years with effect from June 8, 2021, ceased to be a Director of the Bank with effect from close of office hours on June 7, 2024, upon completion of his term as an Independent Director on the said date.

RESIGNATION OF INDEPENDENT DIRECTOR

Mr. Biswamohan Mahapatra (DIN: 06990345) resigned from the position of the Non-Executive Independent Director of the Bank with effect from June 14, 2024, as he was not able to devote sufficient time for the work relating to his role as an Independent Director of the Bank due to his other personal and professional commitments.

Pursuant to Regulation 30 of SEBI (Listing Obligation and Disclosure Requirements) Regulation, 2015 read with Clause 7B of Part A of Schedule III, Mr. Biswamohan Mahapatra confirmed that there are no material reasons for his resignation from the position of Independent Director of the Bank other than on personal and professional commitments.

The Board places on record its appreciation for the valuable contributions made to the Bank and for the support and cooperation extended by Mr. Biswamohan Mahapatra, during his tenure as an independent director of the Bank. The Board also acknowledged with thanks the professional and unbiased approach that Mr. Biswamohan Mahapatra had taken at the Board and the Committee meetings.

WOMAN DIRECTOR

In terms of the provisions of Section 149(1) of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations, the Bank is required to have at least one independent woman director on the board. Currently, there are three independent women directors on the Board of the Bank. Ms. Bhama Krishnamurthy (DIN: 02196839) has been appointed since September 03, 2018, Ms. Sharmila Abhay Karve (DIN: 05018751) since July 20, 2020 and Ms. Renu Kohli (DIN:07981627) since December 14, 2023.

DIRECTORS RETIRING BY ROTATION

In terms of Section 152 of the Companies Act, 2013, NonExecutive Director, Mr. Sumit Maheshwari (DIN: 06920646) shall retire by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting (AGM).

Mr. Sumit Maheshwari (DIN: 06920646) was at first appointed as an Additional Director of the Bank with effect from September 03, 2018, under Section 161(1) of the Companies Act, 2013 and his appointment was regularised at the 97^th AGM held on September 29, 2018 and he was liable to retire by rotation.

Mr. Sumit Maheshwari (DIN: 06920646) was last reappointed as a director to retire by rotation at the 101^st Annual General Meeting held on September 27, 2022, in terms of Section 152 of the Companies Act, 2013.

Approval of the members of the Bank is being requested for re-appointment of Mr. Sumit Maheshwari (DIN: 06920646) as Non- Executive, Non-Independent Director of the Bank.

The detailed profile of Mr. Sumit Maheshwari (DIN: 06920646) recommended for reappointment in the ensuing Annual General Meeting will be provided in the Notice of the

Annual General Meeting for the benefit of shareholders as per the provisions of the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Secretarial Standard on General Meetings (SS-2).

INDEPENDENT DIRECTORS - COMPLIANCE STATUS

The Bank fully satisfies the requirements of Section 149 of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations in connection with the appointment of Independent Directors and the following are the Independent Directors of the Bank as on the date of this report.

Sl. No	Name of the Independent Director	Term	Term of appointment is up to
1	Ms. Bhama Krishnamurthy (DIN: 02196839)	Second	September 28, 2024
2	Ms. Sharmila Abhay Karve (DIN: 05018751)	Second	July 19, 2028
3	Mr. Sudhin Bhagwandas Choksey (DIN: 00036085)	Second	January 30,2029
4	Mr. Sharad Kumar Saxena (DIN: 08238872)	First	February 18, 2025
5	Ms. Renu Kohli (DIN:07981627)	First	December 13, 2028
6	Mr. Deepak Maheshwari (DIN: 08163253)	First	June 11, 2027

The performance of the Independent Directors is subject to evaluation as per Section 149(8) of the Companies Act, 2013 and read with Schedule IV to the said Act.

The Board is confident about their integrity, expertise and experience in the relevant functional areas.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have confirmed of having complied with the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with 25(8) of the Regulations that they meet the criteria of independence laid down thereunder. Further, they have also complied with the Code for Independent Directors prescribed in Schedule IV to the Companies Act, 2013 and the Code of Conduct and Ethics for Board of Directors and Senior Management Personnel of the Bank. Based on the declarations submitted by the Independent Directors, Board is of the opinion that, they fulfil the conditions specified in the Act and SEBI LODR and are independent of the management. There has been no change in the circumstances affecting their status as Independent Directors of the Bank.

Pursuant to rule 6(3) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, the Independent Directors of the Bank have affirmed that, they had registered as an Independent Director in the Independent Directors Data Bank as required under rule 6(1) and 6(2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 and had also complied with the requirements of passing the online proficiency selfassessment test/ exempted from online proficiency selfassessment test in terms of Rule 6(4) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended.

Board is of the opinion that Independent Directors appointed since the date of last report and up to the date of this report are persons of integrity, and has the necessary knowledge, experience and expertise and further, the Board has ensured that the independent directors have also complied with the requirements of passing the online proficiency self-assessment test/exempted from online proficiency self-assessment test in terms of Rule 6(4) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended for being appointed/continue to be appointed as an Independent Director of the Bank.

FAMILIARISATION PROGRAMMES OF INDEPENDENT DIRECTORS

All directors, including Independent Directors are familiar with their roles, rights and responsibilities in the Bank at the time of appointment and also on a recurring basis. The Bank facilitates familiarisation programme and other programmes including Certification programme in IT and Cyber Security for its directors.

The details of various programmes undertaken/arranged for familiarising the Independent Directors and other programmes arranged for the directors are disclosed in the Report on Corporate Governance, which forms part of this Report.

Details of familiarisation programmes attended by all Directors including Independent Directors are provided at https://www.csb.co.in/pdf/Disclosure_on_Familiarisation_ Programmes_for_Board_of_Directors_22032024.pdf, pursuant to Regulation 46 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

APPOINTMENT/ CHANGES IN KEY MANAGERIAL PERSONNEL

Mr. B. K. Divakara, Head - Strategy and Corporate Legal has been elevated and appointed as Whole-time Director (Executive Director), for a period of 3 (three), with effect from March 15, 2024 up to March 14, 2027 (both dates

inclusive). He has been designated as Key Managerial Personnel of the Bank with effect from his date of appointment as Whole-time Director on March 15, 2024.

Mr. Pralay Mondal, Managing Director & CEO, Mr. Satish Gundewar, Chief Financial Officer and Mr. Sijo Varghese, Company Secretary, continues to be the Key Managerial Personnel as per the provisions of the Companies Act, 2013.

BOARD AND ITS COMMITTEES Board and Number of Meetings

Regular meetings of the Board are held to discuss and decide on various business policies, strategies and other businesses. Due to business exigencies, certain decisions are taken by Board through resolution passed by circulation from time to time.

The Board met 13 (thirteen) times during the FY 2023- 24 and the gap between the said meetings did not exceed the limit of 120 days, as prescribed under the relevant provisions of the Act, the relevant Rules made thereunder and the applicable SEBI Listing Regulations.

The schedule of the meetings of the Board is fixed on a yearly basis and circulated in advance to the members of the Board for their consideration and approval.

Detailed information on the meetings of the Board is included in the report on Corporate Governance, which forms part of this Report.

Committees of the Board

The Bank has eleven sub-committees of the Board and the same have been formed as part of the best corporate governance practices and/or in compliance with the requirements of the relevant provisions of applicable laws and regulatory prescriptions.

The details with respect to the compositions, powers, roles, terms of reference, etc., of the above Committees are given in detail in the ‘Report on Corporate Governance'' which forms part of this Report.

AUDIT COMMITTEE

The Bank has constituted the Audit Committee of the Board is in terms of the extant guidelines of Reserve Bank of India (RBI), provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Committee discharges the functions laid down in the Companies Act, 2013 and those prescribed by the Reserve Bank of India and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. It also discharges the functions delegated by the Board of Directors from time to

time. The ACB acts as an effective tier to the Board in the matters of inspection, audit and internal control system.

The Board has accepted all the recommendations of the Audit Committee. The composition, role and functions of Committee, are provided in the Report on Corporate Governance, which forms part of this annual report.

ANNUAL EVALUATION OF PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013, the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and also in line with Board evaluation policy, Bank has put in place criteria for annual evaluation of performance of Chairperson, Managing Director & CEO, Executive Directors, Non-executive Directors, Independent Directors, Board Level Committees and the Board as a whole.

The performance of the members of the Board other than independent Directors and the Board as a whole has been evaluated separately at the meeting of the Independent Directors.

The performance of the independent Directors has been reviewed by the Board as provided for under Section 149(8) read with Schedule IV of the Companies Act, 2013.

The Statement indicating the manner in which formal annual evaluation of the Directors, Committees of the Board and the Board are given in detail in the report on Corporate Governance, which forms part of the Annual Report.

The Nomination & Remuneration Committee of the Board annually reviews and approves the criteria and the mechanism for carrying out the said exercise effectively.

The Board evaluation policy is displayed on the website of the Bank at: https://www.csb.co.in/pdf/Annexure-III_Board_ Evaluation_PolicY_15072024.pdf

PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Considering the nature of activities of the Bank, with respect to the provisions of Section 134(3)(m) of the Companies Act, 2013, relating to conservation of energy and technology adoption, the Bank is constantly pursuing and making all-out efforts to achieve the desired goals as contained in the Act.

Ensuring compliance of the provisions of Section 134(3) (m) of the Companies Act, 2013, read with Rule (8)(3) of the Companies (Accounts) Rules, 2014, the relevant disclosures to be made are as under:

a) Conservation of Energy

All attempts are being made to reduce energy consumption to the maximum extent possible. As part of these measures, the Bank is installing LED lights and other energy saving equipments in a phased manner across.

b) Technology Absorption

The required technology absorption is being made considering the nature of activities undertaken by the Bank.

c) Foreign Exchange Earnings and Outgo

Foreign Exchange earnings and outgo are part of the normal banking business of the Bank. Being an Authorised Dealer in Foreign Exchange, the Bank has been taking all possible steps to augment export credit.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS

During the FY 2023-24, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Bank''s operations in future.

MAINTENANCE OF COST RECORDS

Being a Banking Company, the Bank is not required to make and maintain such accounts and cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

CEO & CFO CERTIFICATION

Pursuant to Regulation 17(8) of the SEBI Listing Regulations, the Certificate issued by Mr. Pralay Mondal, Managing Director & CEO and Mr. Satish Gundewar, Chief Financial Officer of the Bank, for the financial year ended March 31, 2024, was placed before the Board at its meeting held on April 26, 2024.

INFORMATION UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Bank has formulated and adopted a Policy on Prevention of Sexual Harassment of Women at workplace.

The Bank has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The information

relating to complaints received and redressed during the FY 2023-24, is disclosed in the Report on Corporate Governance, which forms part of this Annual report.

STRICTURES AND PENALTIES

There are no instances of non-compliance by the Bank and no penalties or strictures have been imposed on the Bank by the Stock Exchange(s) and/or SEBI and/or any other statutory authorities on matters relating to capital market activities, during the last three years.

DISCLOSURE UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

Being a banking company, the disclosures required as per Rule 8(5)(xi)&(xii) of the Companies (Accounts) Rules, 2014, on the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year and the details of difference

between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, are not applicable to the Bank.

However, being a banking company, during the period under review, your Bank was part of the Corporate Insolvency Resolution Process (CIRP) initiated against the two corporate debtors before NCLT for a total book value of '' 4.06 crore.

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 of the Companies (Management and Administration) Rules, 2014, as amended, the Annual Return (MGT-7) as on March 31, 2024, will be displayed on the website of the Bank at: https://csb.co.in/investor- relations > General meetings > Annual General Meeting - 2024.

ACKNOWLEDGEMENTS AND APPRECIATIONS

The Board of Directors is grateful to the Government of India, Reserve Bank of India, Securities and Exchange Board of India, Ministry of Corporate Affairs, Stock Exchanges, Insurance Regulatory and Development Authority of India, the domestic banking community, the Registrar and Share Transfer Agent, Depositories and rating agencies for their continued support and guidance. The Board of Directors would like to take this opportunity to express sincere thanks to its valued clients and customers for their continued patronage.

The Board also expresses its deep sense of appreciation and heartfelt thanks to every member of the CSB family for their strong work ethics, excellent performance, professionalism, teamwork, commitment and initiatives which has led the Bank towards reinforcing its customer centric image and making commendable progress in today''s challenging environment. The Board looks forward to their continued, dedicated and sincere service to take the Bank to new heights.

Finally, the Board of Directors wish to record their deep sense of obligation and gratitude to all the Shareholders, well-wishers and all other stakeholders of the Bank for their patronage and look forward to continuing this mutually supportive and beneficial relationship in future as well.

ANNEXURES FORMING PART OF THIS REPORT The following Annexures as referred to in this Report form part of the Board''s Report:
Annexure	Particulars
Annexure - I	Disclosures under SEBI (share Based Employee Benefits And Sweat Equity) Regulations, 2021 and/or the Companies Act, 2013.
Annexure - II	Business Responsibility and Sustainability Report (BRSR) of the Bank for the FY 2023-24.
Annexure - III Annexure - IV Annexure - V Annexure - VI Annexure -VII	Management Discussion and Analysis. Report on Corporate Governance. Form AOC-2 - The particulars of contracts or arrangements with related parties entered in terms of Section 188(1) of the Companies Act, 2013. The Annual Report on Corporate Social Responsibility Activities of the Bank for the financial year 2023-24. Secretarial Audit Report.
Annexure -VIII	Disclosure under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

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Mar 31, 2023

Your Directors have pleasure in presenting you the 102^nd Annual Report of CSB Bank Limited (“CSB Bank/ the Bank") together with the Audited Financial Statements, Independent Auditors'' Report and the Report on the business and operations of the Bank for the financial year ended March 31, 2023.

FINANCIAL PERFORMANCE AND STATE OF THE BANK''S AFFAIRS

The financial highlights of the Bank for the financial year under review, are presented below:

(Rs.in Cr)
Particulars	March 31, 2023	March 31, 2022
Deposits	24,505.81	20,188.30
Net Advances	20,650.65	15,814.68
Total Assets/Liabilities	29,162.28	25,356.27
Interest Income	2,319.65	2,038.31
Net Interest Income (NII)	1,333.84	1,153.30
Non-Interest Income	316.01	246.80
Operating Profit/ (Loss)	707.40	613.72
Provisions and Contingencies (Other than tax)	(26.21)	(0.51)
Profit /(Loss) before Tax	733.61	614.23
Provision for taxes	186.25	155.74
Net Profit / (Loss)	547.36	458.49
Add: Surplus/(Deficit) brought forward from last year	(198.83)	(509.49)
Profit & Loss Account balance before appropriations	348.53	(51.00)
Appropriations
Statutory Reserve u/s 17 of the Banking Regulation Act,1949.	136.84	114.62
Capital Reserve	0.14	9.83
Special Reserve	4.27	4.30
Investment Fluctuation Reserve	Nil	19.08
Balance carried over to Balance Sheet	207.29	(198.83)
(? in Cr)
Particulars	March 31, 2023	March 31, 2022
Key Performance Indicators
Capital Adequacy Ratio (CRAR)% Basel - III	27.10	25.90
Earnings per share (in '')	31.55	26.43
Book value per share (in '' )	184.66	152.83
Net Interest Margin%	5.48	5.27
Cost-Income Ratio%	57.12	56.17
Return On Assets (ROA)%	2.06	1.90
Return On Equity (ROE)%	20.35	21.28
Gross NPA %	1.26	1.81
Net NPA %	0.35	0.68

Your Bank had rolled out the change management theme of Sustain Build Scale 2030 (SBS 2030) in

FY 22, and a year has gone by. In every transformation journey, achieving the initial milestones builds the team''s confidence. The key milestones that were set for FY 23 were to sustain the core strengths and to initiate the build phase. In both the milestones, your Bank fared well. During the year, your Bank could demonstrate a YoY growth of 48% in gold loans, which we consider as our major strength. The key levers and enablers set forth for the build phase include proper segmentation/ verticalisation, good governance structure, growth-oriented policies, building infrastructure, robust and efficient customer centric process, strong and experienced leadership team, digital innovations etc. Fortunately, your Bank could achieve the milestones targeted for FY 23, for each of these in the expected lines. All the verticals planned for FY 23 have been set up and green shoots are visible. With a view to build a quality asset book, initiatives like revamped Retail/SME credit policies, loan products specific to businesses/ consumers including surrogates, scorecard-based products etc, processes like set up of - Real Estate Valuation Group (REVG), Fraud Control Unit (FCUs) etc have been rolled out. Coming to infrastructure, the Bank has for the third consecutive year opened 100 branches in FY 23 and installed 63 new ATMs. On the technology front, though the major investments and plans are for the coming two years, we have created a blueprint of the structure and architecture that is to be implemented for the scale that we are aspiring for. However, the basic platforms like Loan Origination System (LOS), Lead Management System (LMS), product management tool, liability systems, payment/channel systems, cyber security etc., are put in place. The setting up of the Branch Service Quality Index Group (BSQIG) team is aimed towards ensuring the right culture and mindset among the team members to keep customer centricity at the heart of all our initiatives. On the leadership front, your Bank have a team with relevant experience to build and scale the franchise with long-term vision and commitment. The digital journey is picking up pace as the tech platform is getting ready. In short, the good start in FY 23 gives us the comfort to pursue this journey with more confidence.

PERFORMANCE OVERVIEW

During the period under review, your Bank continued to deliver on stakeholder expectations both in terms of topline and bottom line and registered a record net profit of ''547.36 crore, up by 19% YoY, backed by 25% business growth, 31% net loan book growth, and 21% deposit growth. Your Bank was able to grow faster than the average industry growth trend in terms of deposits and advances.

In the Financial year 2022-23, the total income grew by ''350.55 crore to ''2,635.66 crore from ''2,285.11 crore in the corresponding previous financial year. During the same period, Interest income increased by ''281.34 crore to ''2,319.65 crore from ''2,038.31 crore and NonTreasury Other Income increased by ''78.27 Crore to ''313.57 Crore from ''235.30 Crore in the corresponding previous financial year. During the same period, Net Treasury Income decreased by ''9.06 crore to ''2.44 Crore from ''11.50 Crore in the corresponding previous financial year.

During FY 2022-23, the total Operating Profit of the Bank increased by ''93.68 crore to ''707.40 crore from ''613.72 crore and Net Profit increased by ''88.87 crore to ''547.36 crore from ''458.49 crore in the corresponding previous financial year.

Your Bank reported a record net profit of ''547.36 crore in the financial year 2022-23 compared to ''458.49 crore in the corresponding previous financial year. The profit came in the backdrop of a strong growth in net interest income (NII). Non- interest income was backed by processing fee, commissions on selling third party products and charges collected from deposit accounts.

In the same period, the Bank''s total advances grew by ''4,746.70 crore to ''21,489.09 crore led by 48% growth in gold loans to ''9,701 crore from ''6,570 crore and 33% growth in Agriculture and MFI loans to ''1,419 crore from ''1,064 crore.

Deposits grew by ''4,317.52 crore to ''24,505.81 Crore from ''20,188.30 crore in the corresponding previous financial year.

Gross non-performing assets (GNPAs) decreased by ''26.95 crore to ''262.56 crore as on March 31, 2023 from ''289.51 crore as on March 31, 2022. Net non-performing assets (Net NPAs) decreased by ''35.17 crore to ''71.82 crore as on March 31, 2023 from ''106.99 crore as on March 31, 2022. The gross NPA as percentage of advances improved by 55 basis points to 1.26% as on March 31, 2023 as against 1.81% as on March 31, 2022. Net NPAs improved by 33 basis points to 0.35% as of March 31, 2023 from 0.68% as on March 31, 2022. Provision Coverage Ratio improved to 92.11% at the end of the financial year from 89.65% in the corresponding previous financial year.

Total Assets have increased by ''3,806.01 crore and stood at ''29,162.28 crore as on March 31, 2023 as against ''25,356.27 crore as on March 31, 2022. Net Advances have increased by ''4,835.97 crore and stood at ''20,650.65 crore as on March 31, 2023 as against ''15,814.68 crore as on March 31, 2022.

TOTAL BUSINESS

Total business of the Bank stood at ''45,995 crore as on March 31, 2023, as against ''36,931 crore a year before, registering a y-o-y growth of 25%.

CASA DEPOSITS

Total CASA deposits grew by ''1,091.09 crore to ''7,886.26 crore as on March 31, 2023 from ''6,795.17 crore as on March 31, 2022. Total Term Deposits grew by ''3,226.42 crore to ''16,619.55 crore in the same period from ''13,393.13 crore of the corresponding previous financial year. Total Non-Resident Deposits grew by ''400.15 crore to ''4,925.62 crore in the same period from ''4,525.47 crore of corresponding previous year.

ADVANCES

Total advances stood at ''21,489.09 crore as on March 31, 2023 as against ''16,742.39 crore as on March 31, 2022, registering a y-o-y growth of 28%. The gross CD Ratio of the Bank as on March 31, 2023 stood at 87.69% as against 82.93 % in the corresponding previous financial year.

Gold loan portfolio grew by 48% to ''9701 crore as on March 31, 2023 from ''6,570 crore as on March 31, 2022, whereas Retail other than gold and Corporate portfolios grew by 30% and 16% respectively in the same period

PRIORITY SECTOR LENDING

Priority Sector Advance extended by the Bank grew by ''2,292.25 crore to ''10,283.87 crore from ''7,991.62 crore in the corresponding previous financial year, registering a y-o-y growth of 28.68%.Your Bank has achieved all the regulatory targets set under the priority sector lending.

ASSETS QUALITY

Indian banks asset quality has improved over the last couple of years and is soon expected to be better than what it was in the earlier days before the beginning of the massive cleansing of balance sheets under regulatory guidance. Experts predict that the gross NPA ratios of scheduled commercial banks to reduce in the coming FY''s due to lower incremental slippages, reduction in SMA accounts, restructuring portfolios and healthy growth in advances.

A decline in the overall stressed assets due to a reduction in GNPA''s on account of resolution and /or write-offs and improvement in restructured assets with control on asset slippages is expected to continue.

Write off contributed to improving asset quality in Public Sector Banks (PSBs) while upgradation of assets & collections has contributed in reduction of GNPAs in Private sector Banks. There is lurking apprehension that asset quality may deteriorate once the restructuring

period of loans allowed during pandemic time gets over. Though the share of GNPAs from large credit of the Indian Banking system declined from 66.4 % in 2020-21 to 63.4 % in 2021-22, the pipeline stress reflected in the data of special mention accounts (SMA) of banks shows increased potential stress in large credit for both PSBs and private banks. The data on SMA 0 with over dues from 0 to 30 days indicates early pipeline stress while SMA1 - 31 to 60 days of over dues and SMA2 - 61 to 90 days of over dues is indicative of accumulating stress in loan portfolio. It all depends on how the monitoring and control is organised by banks to improve the state of asset quality.

Close monitoring of Special Mention Accounts (SMA) including SMA-0 accounts was one of the Bank''s focus areas during the year in its pursuit of improving asset quality. Multi-level monitoring of SMA portfolio, effective response to the signals thrown up by the automated Early Warning Signal (EWS) systems, monitoring of stressed accounts in the SME segment by dedicated Relationship Managers, tele-calling for improving collection of retail loans and collection through external agencies in some of the business segments have paid rich dividends in the area of stress containment and asset quality improvement during the year.

By initiating appropriate recovery steps in a time bound manner, your Bank could recover / upgrade substantial amounts of NPAs during the year. Account wise follow up of small & large value NPAs at Head Office level has also proved to be very effective in recovery maximisation.

Major chunk of the NPA recovery achieved by the Bank was through negotiated settlements. Organising Recovery Melas / Camps, participating in LOK Adalats, referring of small value accounts for recovery under Revenue Recovery Act in the State of Kerala, repossession and sale of secured assets under SARFAESI Act, 2002 and pursuing legal action by filing suits in Civil Courts / DRT etc., have been the strategies pursued by the Bank for recovery maximisation during the period under review. Compromise / One Time Settlement of NPAs was also pursued by the Bank for NPA recovery during the year which too proved as an effective tool.

The initiatives taken by the Bank have helped in containing the SMA portfolio at all-time low. During the period under review, your Bank could achieve cash recovery to the tune of ''73.39 Crore and up-gradation of NPAs to the tune of ''18.90 Crore. The recovery from the PWO portfolio and interest cash recovery amounted to ''70.74 Crore and ''16.49 Crore, respectively.

The Gross NPA of the Bank as on March 31, 2023 stood at a level of ''262.56 Crore as compared to ''289.51 Crore

in the corresponding previous financial year. The Gross NPA and Net NPA ratios are at 1.26% & 0.35% respectively as against 1.81% and 0.68% respectively in the previous financial year. The provision coverage ratio as on March 31, 2023 improved to 92.11% from the level of 89.65% in the previous financial year.

Your Bank continues to focus on arresting fresh delinquencies through close monitoring and recovery of NPAs by initiating appropriate and timely recovery steps.

FINANCIAL PERFORMANCE

Net Interest Income (NII) increased to ''1,333.85 Crore in FY 2022-23 from ''1,153.30 Crore in FY 2021-22. NonTreasury Other Income increased to ''313.57 Crore in FY 2022-23 from ''235.30 Crore in FY 2021-22. However, the Net Treasury Income decreased to ''2.44 Crore in FY 2022-23 from ''11.50 Crore in FY 2021-22.

Provisions other than taxes decreased by ''25.70 crore from ''(0.51) crore to ''(26.21) crore. The Operating Profit for the financial year 2022-23 was ''707.40 crore before taxes and provisions as against ''613.72 crore in the financial year 2021-22 mainly on account of increased net interest income and other income excluding treasury profits.

The Net Profit for the financial year 2022-23 was ''547.36 crore as compared to a Net Profit of ''458.49 crore in the financial year 2021-22.

DIVIDEND

Your Bank has formulated the Dividend Distribution Policy as per the requirements of Regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, (“SEBI Listing Regulations") and guidelines issued by Reserve Bank of India.

The objective of the Policy is to lay down the criteria to be considered by the Board, before recommending dividend to its shareholders, whether it be Interim/ Special Dividend or Final Dividend. The Bank believes in optimizing the shareholder''s wealth by offering them various corporate benefits from time to time after considering the Capital to Risk (Weighted) Assets Ratio (CRAR) and reserve requirements subject to regulatory stipulations.

Though the Bank posted the highest ever net profit in its history during the financial year, with the object of conserving the capital for future expansion, strengthening its balance sheet and reserves further, your directors do not propose to recommend any dividend for the financial year ended March 31, 2023.

The Dividend Distribution Policy is available on the Bank''s website at https://www.csb.co.in/pdf/Dividend Distribution Policy y 20122022.pdf

CHANGE IN THE NATURE OF BUSINESS

During the financial year under review, there has been no change in the nature of business of the Bank.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE BANK

There are no material changes and commitments, affecting the financial position of the Bank which has occurred between the end of the financial year of the Bank i.e., March 31, 2023 and the date of the Directors'' Report.

CAPITAL STRUCTURE

The Authorised share capital of the Bank stood at ''220.00 Crore divided into 22 Crore equity shares with a face value of ''10/- each as on March 31, 2023. During the financial year under review, there has been no change in the Authorised share capital of the Bank.

The Paid-up Equity Capital of the Bank stood at ''173.49 crore comprising 17,34,85,827 fully paid-up Equity Shares of ''10/- each as on March 31, 2023. The Bank has not allotted any shares during the financial year 2022-23, and as a result, the paid-up capital of the Bank remains unchanged, i.e., ''173.49 crore.

RESERVES

The free reserves and surplus stood at ''2,309.41 crore as on March 31, 2023 as against ''1,901.97 crore (including debit balance in Profit and Loss Account) as on March 31, 2022.

The Bank''s Net owned funds grew to ''2,964.10 crore from ''2,416.51 crore as of the previous financial year, and its market capitalization stood at ''4,252.14 crore as on March 31, 2023 as against ''3,663.15 crore as on March 31, 2022.

CAPITAL ADEQUACY RATIO

The Bank''s overall Capital Adequacy Ratio (CRAR) under Basel III stood at 27.10% at the end of fiscal 2023, well above the benchmark requirement of 11.50% stipulated by Reserve Bank of India.

Of this, the Common Equity Tier I (CET I) CRAR was 25.87% (against minimum regulatory requirement of 8.00%) and Tier I CRAR was 25.87% (against minimum regulatory requirement of 7.00%)

As on March 31, 2023, the Bank''s Tier II CRAR under Basel III stood at 1.23%.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Board of Directors, to the best of its knowledge and ability, confirm that

a. In the preparation of the annual accounts for the financial year ended March 31, 2023, the applicable accounting standards had been followed along with proper explanation relating to material departures.

b. The directors have 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 2022-23 and of the profit and loss 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 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, 2023 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 were operating effectively.

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.

PROMOTER HOLDING - FIH MAURITIUS INVESTMENTS LTD

FIH Mauritius Investments Ltd (FIHM), the promoter of the Bank holds, 49.72 % in the paid-up capital of the Bank which is in line with Reserve Bank of India vide Master Direction No. DBR. PSBD. No.56/16.13.100/2015-16 dated November 19, 2015 on ''Prior approval for acquisition of shares or voting rights in Private Sector Banks'' and Reserve Bank of India Master Direction DBR.PSBD.No.95/16.13.100/2015- 16 dated May 12, 2016 on ''Ownership in Private Sector Banks Directions, 2016'' which were subsequently repealed and replaced with the Reserve Bank of India (Acquisition and Holding of Shares or Voting Rights in Banking Companies) Directions, 2023 (“Master Direction") read with Reserve Bank of India Guidelines on Acquisition and

Holding of Shares or Voting Rights in Banking Companies ("Guidelines"), dated January 16, 2023.

There is no change in the promoter holding during the financial year under review.

FIHM holding in the Bank is subject to the dilution schedule as mandated by Reserve Bank of India while according to its approval to acquire up to 51 % of the post issue paid-up capital of the Bank and the relevant RBI guidelines as applicable, from time to time.

Pursuant to Section 12(2) of Banking Regulation Act and a Gazette Notification no. DBR.PSBD. No. 1084/16.13.100/2016-17 dated July 21, 2016, read with Guidelines dated January 16, 2023, voting rights of FIHM are currently capped at 26% of the total voting rights of the Bank.

QUALITY INITIATIVES

Bank focuses on maintaining highest standards of quality through innovative technology platforms thereby ensuring superior services to customers and other stakeholders. Bank is having ISO 27001:2013 certification for IT, IS and data-centres which is valid till 27-9-2024 and the rating awarded for Bank''s information security system is ''very good'' by rating agency, STORMS, and is in advanced security category by the rating agency, BitSight.

CSB Institute of Learning & Development (CSBILD) has retained its ISO 9001:2015 certification obtained during the previous financial year. Using a combination of e-learning methodology and virtual programs, CSBILD has covered a diverse spectrum of employees across the Bank in the current FY. The coverage of employees in FY 2022-23 is 20,802 for various internal and external programs. This is higher than the coverage in FY 2021-22 which was 16,143. Among the various initiatives taken in the current financial year, we have achieved the highest coverage of employees for various compliance related trainings through our LMS platform.

CREDIT RATINGS OF DEBT INSTRUMENTS

CRISIL, vide letter dated May 24, 2023, has reaffirmed the rating ''CRISIL A1 '' to the ''2,000 crore Certificate of Deposits Programme and ''2,000 crore Short Term Fixed Deposits Programme of the Bank.

CRISIL, vide letter dated May 24, 2023 has reaffirmed ''CRISIL A /Stable'' rating to the proposed ''500 Crore Tier II, Basel III compliant bonds issue Programme of the Bank. India Ratings and Research, vide letter dated August 18, 2022, has reaffirmed its rating of ''IND A'' with Outlook Stable, to the proposed ''500 Crore Tier II, Basel III compliant bonds issue Programme of the Bank.

The Bank has not yet issued any bonds as part of the programme.

Further details of all credit ratings obtained by the Bank along with revisions thereto, if any, during fiscal 2023, for all the debt instruments outstanding as on March 31, 2023, are provided in the Report on Corporate Governance, forming part of this annual report.

DEPOSITS ISSUANCE PROGRAMME

During the period under review, your Bank raised ''1,000 Cr (fv) under the Certificate of Deposits programme from various mutual funds and banks, and out of the same, the outstanding as on March 31, 2023 was ''100 crore (fv). The Bank has not raised deposits under the Short Term Fixed Deposits Programme during the period under review.

ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS

As on the date of this Report, the Bank has not issued any equity shares with differential voting rights.

ISSUE OF SWEAT EQUITY SHARES

As on the date of this Report, the Bank has not issued any sweat equity shares.

EMPLOYEES STOCK OPTION SCHEME CSB Employees Stock Option Scheme 2019

The Bank, on receipt of approval of the shareholders by postal ballot on May 4, 2019, formulated a stock option scheme called "CSB Employees Stock Option Scheme 2019" ("ESOS 2019" or "Scheme"). The first amendment was made in the Scheme at the Annual General meeting of the Bank held on July 20, 2020, inter alia, to increase the Options Reserve by an additional quantum of 1,16,72,791. The source of corresponding number of shares equivalent to 1,16,72,791 options shall be in the form of (i) fresh issue of shares up to 30,00,000 shares and (ii) secondary acquisition by the Trust up to 86,72,791 shares. With this, the total Options Reserve under ESOS 2019 stood at 1,66,72,791 options. The second amendment was made in the Scheme at the Annual General meeting of the Bank held on August 12, 2021, permitting vesting of unvested employee stock options after the date of retirement/early retirement as per original Vesting schedule as specified in the Grant Letter, subject to the provision of the applicable laws and at the discretion of the Nomination and Remuneration Committee of the Board.

The Scheme is in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014 which was subsequently repealed and replaced with the Securities

and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021.

The scheme is intended to enable the employees, present and future, to get a share in the value that they help to create for the organization over a period of time, aligning the objectives of an individual with those of the Bank as well as to attract and retain critical senior talents with Employee Stock Options as a compensation tool.

The Scheme shall be administered through an employee stock option trust ("ESOS Trust") in the nature of an irrevocable employee welfare trust in due compliance with the applicable laws. Under the Scheme, the Bank, on July 12, 2019, allotted 50,00,000 equity shares to CSB ESOS Trust, at an issue price of ''10/- per share.

None of the amendments made were detrimental to the interests of any existing option grantees, at the respective times. Further, no amendments were made in the Scheme during the FY 2022-23.

Under the Scheme, 7,47,456 stock options were granted in the financial year 2022-23. Out of these, 3,76,067 options were granted on June 28, 2022, at an exercise price of ''196.60 per option, 2,15,000 options were granted on July 21, 2022, at an exercise price of 207.00 per option and 1,56,389 options were granted on September 23, 2022, at an exercise price of ''236.45 per option.

All the options were granted at market price, to be vested subject to the vesting conditions/ malus and claw back arrangements and be exercised within the period as per the terms of the grant and the Scheme.

During the period under review, 2,53,787 options were vested in line with the vesting schedule, of which 1,09,418 options were lapsed due to non-exercise of the options by the grantee within the exercise period allowed. Apart from that, 12,000 options granted during the financial year 2022-23 also lapsed prior to vesting due to the resignation of the grantee.

As on March 31, 2023, the number of options outstanding is 21,32,474 of which vested and in force is 2,88,738 options.

Pursuant to the approval received from Reserve Bank of India on May 4, 2023, the Nomination & Remuneration Committee of the Board on May 10, 2023, granted 13,145 stock options to Mr. Pralay Mondal, Managing Director & CEO, at an exercise price of ''293.80 per option, for the period (February 17, 2022 to September 14, 2022) he held the position of Deputy Managing Director of the Bank.

Amendment proposed in the CSB Employees Stock Option Scheme 2019.

No amendment was proposed to the CSB Employees Stock Option Scheme 2019 in the ensuing Annual General Meeting of the Bank.

CSB Employees Stock Option Scheme -Statutory Compliance

A Certificate of Secretarial Auditors of the Bank pursuant to Regulation 13 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, that the CSB Employees Stock Option Scheme 2019 has been implemented in the Bank in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, and the resolution passed by the Shareholders for the Scheme, will be placed to the Annual General Meeting for the scrutiny of Shareholders.

The statutory disclosures as required as per rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 and Regulation 14 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, are given on the website of the Bank at www.csb.co.in which forms part of this report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

CSB Bank has a legacy embedded with the trust of over 100 years. Ethics, trust, and transparency are the founding legacies of the Bank. CSB Bank always believed and stood for customers who are in the need-based category of society, built its business over a century by supporting effectively through the delivery of basic banking products responsibly and transparently, thereby making a significant difference in the livelihood of the segments it serves. Bank, without losing its focus on business and other key areas, always emphasized on issues related to environment, social and governance which is very evident and reflected through its approach and activities, maintaining exemplary corporate governance standards through transparency and disclosures.

Bank in compliance with Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") read with the SEBI circular SEBI/HO/CFD/CMD-2/P/CIR/2021/562 dated May 10, 2021, presents the Business Responsibility and Sustainability Report (BRSR) of the Bank for the FY 202223, being the second report of its kind, in the format as specified by SEBI, describing the initiatives taken by the Bank from an environmental, social and governance perspective, forms part of this Report as Annexure-ll.

The Report indicates the Bank''s performance against the nine principles of the ''National Guidelines on Responsible Business Conduct''. Reporting under each principle is divided into essential and leadership indicators. The essential indicators are required to be reported on a mandatory basis while the reporting of leadership indicators is on a voluntary basis.

The report has also been hosted on the website of the Bank and can be accessed at https://csb.co.in/investor-relations>General meetings>Annual General Meeting - 2023.

BUY-BACK OF SHARES OR PROVISION OF FINANCIAL ASSISTANCE FOR PURCHASE OF THE BANK''S SHARES

The Bank has not effected any buy-back of its shares or provided any financial assistance for purchase of its shares, to any persons including directors and employees of the Bank in terms of Section 67 of the Companies Act, 2013.

BONDS

Bank has not issued any bonds during the period under review. Bonds issued by the Bank in earlier periods were redeemed as per the redemption schedule and no bonds were outstanding at the beginning and end of the financial year.

DISCLOSURE RELATED TO DETAILS OF DEPOSITS ACCEPTED

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

SUBSIDIARIES AND ASSOCIATES

Your Bank does not have any subsidiaries, joint ventures or associate companies.

There are no companies which have become or ceased to be its subsidiaries, joint ventures or associate companies during the year under review.

Bank has formulated a Policy for determining material subsidiaries pursuant to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same is displayed on the website of the Bank at: https://www.csb. co.in/pdf/2.Policy-for-Determining- Material-Subsidiary. pdf

RISK MANAGEMENT POLICY

The Bank has a comprehensive policy framework which contains separate policies for identification,

measurement, monitoring & control and mitigation of all material risks including but not limited to credit, market, operational, liquidity and other Pillar- II risks. The Bank has put in place an integrated risk management policy which ensures independence of the risk governance structure. IRMD Charter is included in the Integrated Risk Management policy. The risk management policy details the principles, rules and guidelines to be adopted by the Bank for managing and controlling various kinds of risks through various sub-policies. The policies are implemented in an uninterrupted, reliable and comprehensive manner across the entire Bank. The details of risk management practices are provided in the Management Discussion and Analysis Report annexed to the Director''s Report.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

The Vigilance Department as part of its ongoing Vigilance Mechanism has a set of laid down policies viz 1. Fraud Risk Management Policy, 2. Whistle Blower Policy, 3. Anti-Bribery & Anti-Corruption Policy which are scrupulously followed, for surveillance, control, and monitoring of day-to-day activities, in order to prevent frauds and thereby manage the risk of eventual financial loss or damage to the reputation of the Bank. These policies are in tune with the directions of RBI.

Whistle Blower policy is an effective tool to report concerns regarding unethical behaviour, violation of systems & procedures, questions of law, wrong business practices or grave misconduct by the employees. As per this Policy /Mechanism, all stake holders viz Directors & employees of the Bank, customers, Non-Governmental Organizations (NGO) and others can lodge complaints. It is published in the Website of the Bank and thereby creates awareness amongst all the stake holders. The Audit Committee of the Board (ACB) oversees the vigil mechanism through its committee processes. The Chairman of ACB directly hear grievances/ victimisation of employees, who use this mechanism to report such genuine concerns. No employee who is aggrieved is denied access to ACB under this policy. It provides reassurance/protection to the whistle blower from victimisation, discrimination or reprisals for having blown the whistle, in good faith and in the interest of the Bank. The investigation under this policy shall be completed within three months from the date of receipt of the complaint and the report thereof should be placed before the ACB.

Moreover, awareness regarding the said policy as well as the Ethics & Code of conduct for staff, are included in every session of the training programme conducted at the Bank''s Staff Training College, for enhancing awareness of fraud risk and for promoting a culture of compliance amongst the employees.

Similarly, the Fraud Risk Management policy followed by the Bank also covers all aspects of the said vigilance mechanism. Every instance of fraud reported is thoroughly investigated. It ensures that all the systems and procedures are scrupulously followed by all its employees. Bank is taking stringent action against the employees who do not comply with the instructions of the Bank. Deficiencies/irregularities/Lacunae in the system and procedures, if any observed during the investigation, are plugged and wherever necessary systemic corrections are suggested and placed before the ACB, for necessary directions. Further the concerned branches are suitably cautioned so that such deficiencies do not recur, and incidents of frauds minimized. Vigilance Department issues caution advice on a regular basis that disseminates the different modus operandi adopted by the fraudsters in the banking industry, including that occurred in our Bank. This enables the Branches / Offices to prevent similar kind of fraudulent attempts in future. This policy is reviewed every year by the Board and suitably amended, as required. A reference to the Whistle Blower Policy/Vigil Mechanism is also made in every caution note issued by the Vigilance Department.

Further the Anti-Bribery and Anti-Corruption Policy ensures that the stakeholders including employees (whether full-time or contractual, including trainees and interns), Directors, Agents, Associates, Vendors, Consultants, Advisors, Representatives, or Intermediaries do not indulge in any act of ''Bribery'' or ''Corruption'' while discharging their official duties, either in their own name or in the name of the Bank.

Besides investigation of frauds reported/detected, the department also undertakes Preventive Vigilance Audits, to ensure the effectiveness of the prevention mechanism. This promotes a culture of compliance amongst its employees. Moreover, Bank is making all out efforts to prevent frauds by strengthening the existing control measures and by reiterating the systems & procedures, to update and alert its employees. Bank has a well-organized Inspection Department that conducts regular and comprehensive Inspection (RBIA) of branches and offices at specified intervals and also oversees all other Audits and Inspection of the Bank. The Bank is taking several measures to plug the gaps in the areas of appraisal, monitoring, internal systems, etc., to strengthen the overall control system on loan assets. The Bank has strengthened the internal audit system, functions of vigilance department and put in place an appropriate mechanism, information system and the required infrastructure to prevent recurrence, early detection of frauds on an ongoing basis.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to the provisions of Regulation 34(2)(e) of the SEBI Listing Regulations, the Management Discussion and Analysis Report for the year under review is provided in a separate section forming part of this Report.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

Bank has designed and implemented adequate procedures and internal control systems which provide reasonable assurance regarding reliability of financial reporting and preparation of financial statements. For the year ended March 31, 2023, the Board is of the opinion that the Bank has sound Internal Financial Controls commensurate with the nature and size of its business operations wherein controls are in place and operating effectively and no material weaknesses exist.

Bank is operating in a fully computerized environment with Core Banking System supported by diverse application platforms for handling special business such as treasury, trade finance, retail loans, etc. The process of recording transactions in each application platform is subject to various forms of control such as in-built system checks, maker - checker authorisations and independent post transaction reviews. The financial statements are prepared based on computer system outputs. Responsibility of preparations of financial statements is entrusted to a dedicated unit which is independent of business.

For mitigating risks and for KYC norms compliance, Bank has put in place centralized processing for opening of CASA accounts and modifications in customer information. For login to CBS, in addition to login passwords, finger-scan-authentication is implemented and as control measure, dual custody for cash and gold are in place in all branches.

The Bank has a process in place to continuously monitor the existing controls and identify gaps, if any, and implement new and/or improved controls wherever the effect of such gaps would have a material effect on the Bank''s operation. During the year under review, there are no material or serious observations of inefficiency or inadequacy of such controls.

CORPORATE GOVERNANCE

The Bank continues its endeavor to adopt the best prevalent corporate governance practices. A separate section/Report on corporate governance standards followed by your Bank and the relevant disclosures as stipulated under SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 and the Companies Act, 2013 and the rules made thereunder are incorporated in the Corporate Governance Report that forms part of this Annual Report.

A certificate from Bhandari & Associates, Company Secretaries, Mumbai, confirming compliance to the conditions of Corporate Governance as stipulated under SEBI Listing Regulations is annexed to this report.

UPDATE ON IND AS IMPLEMENTATION

Reserve Bank of India (RBI) vide press release RBI/2018-2019/146 DBR.BP.BC.No.29/ 21.07.001/2018-19, dated March 22, 2019, advised all scheduled commercial Banks about deferment of implementation of Ind AS till further notice in the context of legislative amendments recommended by RBI on implementation of Ind AS were under consideration of the Government of India.

The implementation of IND AS is expected to result in significant changes to the way the Bank prepares and presents its financial statements. The key impact areas during the implementation of Ind AS for the Bank include impairment requirements of Financial Instruments based on Expected Credit Loss, interest recognition using effective interest method and Fair valuation of financial assets.

Your Bank is gearing itself for seamless transition to IND AS and to bring the necessary systems in place to facilitate submission of the Proforma IND AS financial statements to RBI . With respect to the various instructions from Ministry of Corporate Affairs and Reserve Bank of India (RBI), the actions taken by Bank are summarized as follows:

• Bank has set up a Steering Committee comprising members from cross-functional areas of the Bank to initiate the implementation process.

• Bank is in the process of implementing changes as required in existing IT architecture and other processes to enable smooth transition to Ind AS. This include automation of computation of Expected Credit Losses (ECL), Effective interest Rate, Fair valuation, related accounting changes and generation of MIS reports.

• As directed by the RBI, the Bank is submitting half yearly Proforma Ind AS financial statements within the stipulated timeline.

• Training to the employees is imparted in a phased manner.

There may be new regulatory guidelines and clarifications in some critical areas of Ind AS application, which the Bank will need to suitably incorporate in its

implementation. The Bank will continue its preparedness towards adoption of ''IND AS'' as per regulatory requirement and to liaise with RBI and industry bodies on various aspects pertaining to IND AS implementation.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE BANK

Pursuant to Section 186 (11) of the Companies Act, 2013, the provisions of Section 186 of Companies Act, 2013, except sub - section (1), do not apply to a loan made, guarantee given or security provided or any investment made by a banking company in the ordinary course of business, hence being excepted from disclosure requirements under Section 134(3)(g) of the said Act.

The particulars of investments made by the Bank are disclosed in Schedule 8 of the financial statements as per the applicable provisions of the Banking Regulation Act, 1949.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

As per the Bank''s ''Policy on materiality of Related Party Transactions and on dealing with Related Party Transactions'', Audit Committee shall review, at least on a quarterly basis, the details of Related Party Transactions entered into by the Bank pursuant to each of the omnibus approval given and such omnibus approvals shall be valid for a period not exceeding one financial year and shall require fresh approvals after the expiry of such financial year. As per the Policy, omnibus approval is required from the Audit Committee for transactions which are repetitive in nature and the same are reviewed on periodical basis. Further, all transactions with related parties in the ordinary course of business and on arm''s length basis requires approval of the Audit Committee of the Board.

As per the amendments made in the SEBI Listing Regulations, 2015, effective from April 1, 2022, all related party transactions and subsequent material modifications shall require prior approval of the Audit Committee of the Bank, review of the same by the Board and further all the material related party transactions and subsequent material modifications as defined by the Audit Committee shall require the prior approval of the members of the Bank.

In line with the said amendment, your Bank has obtained prior approvals of the Audit Committee, the Board, and the members of the Bank via postal ballot resolutions/ at the Annual General meeting for all the related party transactions/material related party transactions as per the said amendments, with effect from April 1, 2022. No transactions were entered into with related parties,

which were not in the ordinary course of the business of the Bank or which were not on an arm''s length basis.

During fiscal 2023, the Bank has not entered into any materially significant transactions with its related parties, which could lead to potential conflict of interest between the Bank and these parties, other than transactions entered into with them in the ordinary course of its business.

The particulars of contracts or arrangements with related parties entered into during the year under review in terms of Section 188(1) of the Companies Act, 2013 are provided in Form AOC-2 as Annexure -III in terms of 134(3) (h) of the Companies Act, 2013.

The ''Policy on materiality of Related Party Transactions and on dealing with Related Party Transactions'' has been reviewed by the ACB and the Board and the same is available on the website of the Bank at https://www.csb.co.in/pdf/ PolicyondealingwithRelatedPartyTransactionnew.pdf in terms of the SEBI Listing Regulations.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Bank recognizes the society as one of its chief stakeholders, and has always given top priority to Corporate Social Responsibility activities. The main objective of CSR policy of the Bank is to make CSR a key business process for sustainable development of the society. The CSR Policy will serve as a guiding document to help identify, execute and monitor CSR projects in accordance with the spirit of the statute.

The Bank, in terms of the requirements of Section 135 of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014, has set up a Corporate Social Responsibility (CSR) Committee to supervise the CSR initiatives of the Bank. The CSR Committee, shall (a) formulate and recommend to the Board, a Corporate Social Responsibility Policy as per Section 135 of the Companies Act, 2013 and further in accordance with Schedule VII of the said Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014. (b) recommend the amount of expenditure to be incurred on the activities as part of the CSR programme of the Bank; (c)monitor the corporate social responsibility policy of the Bank from time to time and

(d) formulate and recommend to the Board, an annual action plan in pursuance of its CSR policy.

During the financial year 2022-23, your Bank has identified various projects and has spent the requisite amount in terms of Section 135 of the Companies Act, 2013 towards CSR activities as per annual action plan approved, spread across areas such as healthcare,

sanitation, education, housing etc. In the financial year 2022-23, the Bank has spent ''6.72 Crore (100% of CSR budget) for CSR activities, as against ''0.84 Crore in the financial year 2021-22. As a responsible citizen, the Bank will continue with a slew of measures for fulfilment of its commitment to the society as a whole.

The Annual Report on Corporate Social Responsibility Activities of the Bank for the financial year 2022-23 has been provided in Annexure - IVto this report.

The Corporate Social Responsibility Policy as recommended by the CSR Committee and as approved by the Board is available on the website of the Bank and can be accessed at https://www.csb.co.in/pdf/CSR%20 Policy_Final_-30032022.pdf

AUDITORS

a) Statutory Auditors

The members of the Bank in the 100^th Annual General Meeting held on August 12, 2021, approved the appointment of B S R & Co. LLP, Chartered Accountants, Mumbai- 400011, for a period of two (2) years together with Mukund M. Chitale & Co, Chartered Accountants, Mumbai - 400057 for a period of three (3) years as the Joint Statutory Auditors of the Bank, to hold office from the conclusion of 100^th Annual General Meeting till the conclusion of the 102^nd and 103^rd Annual General Meetings of the Bank respectively, subject to the specific approval of Reserve Bank of India for each year during their tenure in terms of Section 30(1A) of the Banking Regulation Act, 1949. B S R & Co. LLP, Chartered Accountants was the Statutory Auditors of the Bank to audit the accounts for the financial year ended Mach 31, 2021.

Bank in terms of Section 30(1A) of the Banking Regulation Act, 1949, obtained approval of Reserve Bank of India for the appointment of B S R & Co. LLP, Chartered Accountants Mumbai and Mukund M. Chitale & Co, Chartered Accountants, Mumbai as the Joint Statutory Central Auditors of the Bank for the financial year 2021-22 and thereafter obtained on a yearly basis.

As per Reserve Bank of India Guidelines No. DoS. CO.ARG/SEC.01/08.91.001/2021-22 dated April 27, 2021, regarding “Appointment of Statutory Central Auditors (SCAs)/Statutory Auditors (SAs) in Commercial Banks (excluding RRBs), UCBs and NBFCs (including HFCs)" read with FAQ dated June 11, 2021 and the Bank''s policy with regard to Appointment of Statutory Auditors, an audit firm/s will be allowed to continue as the Statutory Auditor/s (SCA) in the Bank for a period of three years and thereafter the said firm will be compulsorily rested

for a period of six years. Accordingly, M/s. B S R & Co. LLP, Chartered Accountants Mumbai, who will be completing continuous tenure of three years as the Statutory Auditors of the Bank in the ensuing Annual General Meeting, will not be eligible for reappointment in terms of the said guidelines.

Accordingly, in line with said guidelines, the Board on recommendation of the Audit Committee of the Board, recommends the appointment of M/s. Walker Chandiok & Co. LLP, Chartered Accountants, being the first preferred choice of firm to the RBI in place of retiring statutory auditor, B S R & Co. LLP, Chartered Accountants Mumbai, for a period of three (3) years as the second Joint Statutory Auditors of the Bank, to hold office from the conclusion of 102^nd Annual General Meeting till the conclusion of the 105^th Annual General Meeting of the Bank, subject to the specific approval of Reserve Bank of India for each year during their tenure in terms of Section 30(1A) of the Banking Regulation Act, 1949, for the purpose of audit of the Bank, including certifications, reporting on internal financial controls, of the Bank''s accounts at its head office, branches and all the controlling and other offices.

Bank has received consent from the said firm/s and confirmation to the effect that they are not disqualified to be appointed as the Statutory Auditors of the Bank in terms of the provisions of the Companies Act, 2013 and rules made thereunder and Reserve Bank of India Guidelines dated April 27, 2021 and accordingly the recommendation was made to Reserve Bank of India for their appointment being the first preferred choice of firm subject to the approval of Reserve Bank of India(RBl) in terms of Section 30(1A) of the Banking Regulation Act, 1949 and approval of the shareholders of the Bank in terms of Section 139, 142, 143 and other applicable provisions, if any, of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014 and other applicable rules.

Bank in terms of Section 30(1A) of the Banking Regulation Act, 1949, obtained approval of Reserve Bank of India for appointment of M/s. Mukund M. Chitale & Co, Chartered Accountants, Mumbai together with M/s. Walker Chandiok & Co. LLP, Chartered Accountants, Mumbai as the Joint Statutory Auditors of the Bank for the financial year 2023-24 for their third year and first year, respectively.

Pursuant to the amendment made to Rule 3 of the Companies (Audit and Auditors) Rules, 2014 via the Companies (Audit and Auditors) Amendment Rules, 2018, effective from May 07, 2018, the requirement of seeking ratification of the members for the reappointment of the Statutory Auditors has been

withdrawn from the Statute. Hence, ratification of the members for re-appointment of M/s. Mukund M. Chitale & Co. Chartered Accountants, Mumbai as one of the Joint Statutory Auditors of the Bank at the ensuing Annual General Meeting is not being sought for. However, the Bank will continue to seek approval of the shareholders for payment of fees/ remuneration to the Auditors on a yearly basis though approval of the shareholders be sought for their appointment for a period of three years together, in line with the extant guidelines.

Pursuant to the Regulation 33(1) (d) of the SEBI Listing Regulations, the Joint Statutory Auditors have confirmed that they are subjected to the peer review process of the Institute of Chartered Accountants of India (ICAI) and that they hold a valid certificate issued by the Peer Review Board of ICAI.

The Board places on record their appreciation and gratitude to M/s. B S R & Co. LLP, Chartered Accountants, Mumbai- 400011, retiring auditors, for the valuable services rendered by them as Statutory Auditors of the Bank.

b) Independent Auditors'' Report

The Joint Statutory Auditors of the Bank viz., M/s. B S R & Co. LLP, Chartered Accountants, Mumbai and M/s. Mukund M. Chitale & Co, Chartered Accountants, Mumbai, have audited the accounts of the Bank for the FY 2022-23 and their Report is annexed.

Pursuant to Section 143(3)(i) of the Companies Act, 2013, the Statutory Auditors have also reported on the adequacy and operating effectiveness of the internal financial controls system over financial reporting, which has been enclosed as ''''Annexure A" to the Independent Auditor''s Report.

There are no qualifications, reservations or adverse remarks made by the Statutory Auditors in their report for FY 2022-23.

c) Secretarial Auditors and Secretarial Audit Report

Pursuant to Section 204 of the Companies Act 2013, the Bank appointed M/s. Bhandari & Associates, Company Secretaries, Mumbai as its Secretarial Auditors in place of M/s. SVJS & Associates, Company Secretaries, Kochi to conduct the secretarial audit of the Bank for the Financial Year 2022-23. The Bank produced all necessary records to the Secretarial Auditors for the smooth conduct of their Audit.

M/s. SVJS & Associates, Company Secretaries, Kochi, was the Secretarial Auditors of the Bank for the period from 2014-15 to 2021-22, and the decision to appoint new auditors in place of them was in line with the

decision of the Bank to rotate/change Secretarial Auditors by the end of every three financial from the date of appointment, similar to the approach being followed in the matter of the appointment of statutory auditors in the Bank.

The Report of Secretarial Auditors for the said period is annexed to this report as Annexure - VI. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditors in their report for the FY 2022-23.

d) Secretarial Compliance Report

Pursuant to Regulation 24A of SEBI Listing Regulations read with circular No. CIR/CFD/ CMD1/27/2019 dated February 08, 2019, issued by SEBI, the Bank has obtained Secretarial Compliance Report for the financial year ended March 31, 2023, from M/s. Bhandari & Associates, , Company Secretaries, Mumbai, the Secretarial Auditors of the Bank on compliance of all applicable SEBI Regulations and circulars/ guidelines issued thereunder and the copy of the same was submitted with the Stock Exchanges within the prescribed timelines.

(e) Certificate in terms of Regulation 34(3) read with Schedule V of the SEBI Listing Regulations

In terms of Regulation 34(3) read with Schedule V of the SEBI Listing Regulations, the Bank has obtained a Certificate from Bhandari & Associates, Company Secretaries, Mumbai, confirming that none of the Directors on the Board of the Bank have been debarred or disqualified from being appointed or continuing as Directors of the companies either by the Securities and Exchange Board of India or the Ministry of Corporate Affairs or any other Statutory / Regulatory Authorities. The said certificate is annexed to this Report.

(f) Reporting of Frauds by Auditors

During fiscal 2023, pursuant to Section 143(12) of the Companies Act, 2013, neither the Statutory Auditors nor the Secretarial Auditor of the Bank have reported any instances of frauds committed in the Bank by its officers or its employees.

COMPLIANCE TO SECRETARIAL STANDARDS

Your Bank is in compliance with the relevant Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) related to the Board Meetings(SS-l) and the General Meeting (SS-2) during the financial year 2022-23. Further, the Bank has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

TRANSFER OF UN-CLAIMED/UN-PAID DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Dividend transferred to Unpaid Dividend account and remaining unpaid or unclaimed for a period of seven years from the date of such transfer, has to be transferred to Investor Education and Protection Fund as per Section 124 (5) of the Companies Act, 2013.

Since the Bank had not declared any dividends since the financial year 2014-15, no amount was required to be transferred to the Investor Education and Protection Fund (the “Fund") by the Bank for the financial year ended March 31, 2023.

All the unclaimed dividends pertaining to the prior period/ financial years, except the amount of ''9,101, which could not be transferred due to regulatory restraints on such transfers and remained unclaimed for a period of seven (7) consecutive years or more, were transferred to the Fund in the corresponding previous financial years within the stipulated time and in the manner as prescribed in Section 124(6) of the Companies Act, 2013, read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended from time to time.

TRANSFER OF EQUITY SHARES TO INVESTOR EDUCATION AND PROTECTION FUND AUTHORITY

In terms of the provisions of Section 124(6) of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, (as amended) and other applicable rules, notifications and circulars, if any, every company is required to transfer the shares, in respect of which dividend remains unpaid / unclaimed for a period of seven (7) consecutive years, to the Investor Education Protection Fund (IEPF) Authority.

Since the Bank had not declared any dividends since the financial year 2014-15, no shares were required to be transferred to the Investor Education and Protection Fund Authority by the Bank for the financial year ended March 31, 2023.

UNCLAIMED SHARE APPLICATION MONEY

There is no unclaimed Share application money pending with the Bank or to be transferred to Investor Education and Protection Fund.

compensation/ remuneration policy

The Bank has formulated and adopted a Compensation Policy in terms of Reserve Bank of India circular no. DOR.

Appt. BC.No.23/29.67.001/2019 20 dated November 04, 2019, the relevant provisions of Section 178 of the Companies Act,2013, the relevant Rules made thereunder and the SEBI Listing Regulations. The Policy formulates the criteria for determining the remuneration and further deals with the compensation and benefits of Non-Executive Chairman, Non-Executive Directors, Managing Director & CEO, Whole-Time Directors, Material Risk Takers, Control Function Staff and all other officials and employees of the Bank.

The details of the policy have been included in the Report on Corporate Governance, which forms part of this Report. The Policy was reviewed by the Nomination and Remuneration committee and the Board in their respective meetings held on October 21, 2022.

The excerpts from compensation policy are available on the website of the Bank.

NOMINATION POLICY

The Bank has formulated and adopted Nomination policy for appointment and orderly succession of appointment of Part-time Chairman, Managing Director & CEO, Directors, Key Managerial Personnel and Senior Management team in the Bank. The Policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of a director. The details of the same have been included in the Report on Corporate Governance, which forms part of this Annual Report.

The Nomination Policy was reviewed by the Nomination and Remuneration Committee and the Board in their respective meetings held on January 17, 2023 and the same is displayed on the website of the Bank at: https:// www.csb.co.in/pdf/NominationPolicy.pdf

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, in respect of Directors / Employees of the Bank, is attached as Annexure-V to this Report.

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is given in an Annexure and forms part of this report.

In terms of Section 136(1) of the Companies Act, 2013, the annual report and the financial statements are

being sent to the members, excluding the aforesaid Annexure. The said Annexure is available for inspection at the registered office of the Bank, and any member interested in obtaining a copy of the Annexure may write to the Company Secretary of the Bank at board@csb. co.in.

BOARD OF DIRECTORS

The Bank has a broad-based Board of Directors, constituted in compliance with the Banking Regulation Act, 1949, Circulars and Guidelines issued by the Reserve Bank of India, from time to time, the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and in accordance with the best practices/principles in corporate governance adopted by the Bank.

As on the date of this report, the Board comprises of nine (9) Directors, out of which six (6) are Independent Directors, two (2) are Non-executive, Non-Independent Directors and one was Executive Director. The Directors possess rich experience and specialized knowledge in various areas of relevance to the Bank viz. like Agriculture, Rural Economy, Banking, Accountancy, Co-operation, Information Technology, Economics, Finance, MSME, Information Technology, Payment & Settlement Systems, Human Resources, Risk Management and Business Management, etc.

The Board functions as the governing body and also through various Committees constituted to oversee specific areas. Policy formulation, setting up of goals, evaluation of performance and control functions vest with the Board. The Committees have oversight of operational and supervisory issues assigned to them by the Board, from time to time.

Appointment/changes in the Board Directors of the Bank since the last Board''s Report dated June 28, 2022 and up to the date of the Report is as given under:

Re-Appointment of Non-Executive Directors

Director Mr. Sumit Maheshwari (DIN: 06920646), liable to retire by rotation, was re-appointed at the Annual General Meeting held on September 27, 2022.

Part-Time Chairperson

Mr. Madhavan Aravamuthan (DIN : 01865555), NonExecutive Independent Director ceased to be the PartTime Chairman of the Bank with effect from the close of business hours of June 28, 2022 upon expiry of his tenure of appointment as Part-Time Chairman as per Reserve Bank of India letter August 10, 2020. Further, Mr. Madhavan Aravamuthan stepped down from the position of independent director of the Bank with effect

from the close of business hours of June 28, 2022, as his term of appointment as the Part-Time Chairman and first term as Independent Director of the Bank ended on the same day.

The Board places on record its appreciation of the valuable contributions, advises and services of Mr. Madhavan Aravamuthan during his tenure as the Part-Time Chairman as well as an independent director of the Bank. The Board also took note of the sheer professionalism displayed by Mr. Madhavan Aravamuthan during his tenure by sharing unbiased, decisive and professional opinions, keeping in view of all the stakeholders'' interest at hand.

Mrs. Bhama Krishnamurthy (DIN: 02196839), NonExecutive Independent Director, was appointed as the Part-Time Chairperson of the Bank in place of Mr. Madhavan Aravamuthan for the period starting from November 17, 2022 up to September 28, 2024 (both dates inclusive), on receipt of approval of Reserve Bank of India on November 17, 2022 pursuant to section 10B(1A) (i) of the Banking Regulation Act, 1949 which is coterminous with Ms. Bhama Krishnamurthy''s second term of appointment as Independent Director of the Bank.

Mrs. Bhama Krishnamurthy has been on the Board of the Bank since September 3, 2018, as an Independent Director.

Re-Appointment of Independent Directors

Mrs. Sharmila Abhay Karve (DIN: 05018751) was reappointed for a second term as a Non-Executive Independent Director of the Bank for a period of 5 (five) years commencing July 20, 2023, up to July 19, 2028 (both dates inclusive) as per the postal ballot resolution dated December 8, 2022. Mrs. Sharmila Abhay Karve is not liable to retire by rotation, in terms of Section 149(13) of the Act. Her first term as a Non-Executive Independent Director of the Bank ends on July 19, 2023. Mrs. Sharmila Abhay Karve is representing “Majority Sector -Economics, Finance and Accountancy" on the Board of the Bank.

Appointment of Mr. Pralay Mondal as the Managing Director & CEO

Pursuant to the approval received from Reserve Bank of India on September 15, 2022, in terms of Section 35B of the Banking Regulation Act, 1949, for the appointment of Mr. Pralay Mondal (DIN: 00117994) as Managing Director & CEO of the Bank for a period of 3 (three) years with effect from the date of its approval i.e. from September 15, 2022, the Board of Directors of the Bank in its meeting held on September 15, 2022, on the recommendations of the Nomination and Remuneration Committee, elevated and appointed Mr. Pralay Mondal, Deputy Managing Director as the Managing Director & CEO of the Bank, for

a period of three (3) years, with effect from September 15, 2022, up to September 14, 2025 (both dates inclusive).

The appointment of Mr. Pralay Mondal as the Managing Director & CEO and acceptance of the position by him on September 15, 2022, simultaneously ended his tenure as the interim Managing Director & CEO of the Bank.

The approval of the shareholders was obtained on December 8, 2022, for the appointment as well as the terms, including remuneration, of Mr. Pralay Mondal as the Managing Director &CEO, with effect from the date of approval by Reserve Bank of India.

Interim Arrangement

The appointment of Mr. Pralay Mondal (DIN: 00117994), Deputy Managing Director, as interim Managing Director & CEO of the Bank, initially for a period of three months with effect from April 1, 2022, which was extended for a further period of three months with effect from July 1, 2022, or till the appointment of a regular Managing Director & CEO in the Bank, whichever is earlier, pursuant to the approval received from Reserve Bank of India on June 29, 2022, was ended on September 15, 2022, on receipt of the approval of Reserve Bank of India for the appointment of Mr. Pralay Mondal as the Managing Director & CEO of the Bank with effect from the date of approval.

Accordingly, the interim arrangement ceased to be in exist simultaneously on the day of the appointment of Mr. Pralay Mondal as the Managing Director & CEO and his acceptance of the position, i.e., on September 15, 2022.

The approval of the shareholders was obtained in the 101^st Annual General Meeting of the Bank held on September 27, 2022, for the appointment of Mr. Pralay Mondal, Deputy Managing Director as interim Managing Director & CEO of the Bank, for the said period. The terms and conditions of appointment, including remuneration of Mr. Pralay Mondal as Interim Managing Director & CEO remained the same as those for the position of Deputy Managing Director.

Woman Director

In terms of the provisions of Section 149(1) of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations, the Bank is required to have at least one independent woman director on the board. Currently, there are two independent women directors on the Board of the Bank. Mrs. Bhama Krishnamurthy (DIN: 02196839) has been appointed as a Director since September 3, 2018 and Mrs. Sharmila Abhay Karve (DIN: 05018751) since July 20, 2020.

Appointment of Independent Director

Pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Bank in their meeting held on June 20, 2023, appointed Mr. Biswamohan Mahapatra, (DIN: 06990345) as an Additional Director (Non-Executive Independent category) of the Bank w.e.f. June 20, 2023 for a period of five (5) years pursuant to the provisions of Section 149,161(1) of the Companies Act, 2013 and Rules made thereunder, SEBI Listing Regulations and Article 133 of the Articles of Association of the Bank. The said appointment is subject to the approval of the Shareholders of the Bank.

Mr. Biswamohan Mahapatra is a career central banker with over 33 years of experience in various departments of the Reserve Bank of India and retired as Executive Director of Reserve Bank of India in August 2014 where he was in charge of banking regulation, policy, and supervision. Post retirement, he has been an Advisor to RBI on the new bank licensing process. He has represented RBI at various national and international forums and chaired several RBI committees and was also the Member-Secretary to the Committee set up to introduce a financial holding company structure in India and involved in the formulation of Basel II and Basel III regulations. Mr. Biswamohan Mahapatra is representing Majority Sector - ''Banking, Finance, Law, Risk Management and Payment Systems'' on the Board.

Necessary resolution seeking approval of the members in connection with appointment of Mr. Biswamohan Mahapatra as Independent Director of the Bank, forms part of the notice of the ensuing Annual General Meeting.

The detailed profile of Mr. Biswamohan Mahapatra recommended for his appointment as Independent Director in the ensuing Annual General Meeting will be provided in the Notice of the Annual General Meeting for the benefit of shareholders as per the provisions of the Companies Act, 2013, SEBI Listing Regulations and the Secretarial Standard on General Meetings (SS-2).

Opinion of the Board with regard to integrity, expertise and experience (including the proficiency) of the independent directors appointed during the year:

Board has appointed Mr. Biswamohan Mahapatra (DIN: 06990345), as Additional Director of the Bank under (Non- Executive Independent category) based on the extensive due diligence carried out by the NRC on the declarations submitted by him in terms of fit & proper criteria and other applicable statutory guidelines issued by Reserve Bank of India from time to time.

Board noted that Mr. Biswamohan Mahapatra is a career central banker with over 33 years of intense experience in various departments of Reserve Bank of India and retired as Executive Director in RBI.

Adverting to the above, in the opinion of the Board, the said Independent Director appointed on June 20, 2023, possesses the requisite qualifications, proficiency, expertise, track record, integrity, independence, as well as vast and rich experience in the field of Banking.

Re-appointment of Independent Director

Mr. Sudhin Bhagwandas Choksey''s (DIN: 01865555) first term as Non-Executive Independent Director of the Bank ends on January 31, 2024. The Board of Directors and Nomination & Remuneration Committee of the Board, post satisfactory evaluation of his performance, recommended the reappointment of Mr. Sudhin Bhagwandas Choksey as Non-Executive Independent Director of the Bank to hold office for a period of five consecutive years (second term), with effect from January 31, 2024 to January 30, 2029.

Necessary resolution seeking approval of the members in connection with reappointment of Mr. Sudhin Bhagwandas Choksey as Independent Director of the Bank, forms part of the notice of the ensuing Annual General Meeting.

The detailed profile of Mr. Sudhin Bhagwandas Choksey, recommended for his reappointment as Independent Director in the ensuing Annual General Meeting will be provided in the Notice of the Annual General Meeting for the benefit of shareholders as per the provisions of the Companies Act, 2013, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and the Secretarial Standard on General Meetings (SS-2).

Directors Retiring by Rotation

In terms of Section 152 of the Companies Act, 2013, Non- Executive Director, Mr. Madhavan Menon (DIN: 00008542) shall retire by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting.

Mr. Madhavan Menon (DIN: 00008542) was at first appointed as an Additional Director of the Bank with effect from September 03, 2018 under Section 161(1) of the Companies Act, 2013 and his appointment was regularized at the 97^th AGM held on September 29, 2018 and he was liable to retire by rotation.

Mr. Madhavan Menon was last re-appointed as director to retire by rotation at the 100^th Annual General Meeting held on August 12, 2021, in terms of Section 152 of the Companies Act, 2013.

Approval of the members of the Bank is being requested for re-appointed of Mr. Madhavan Menon as NonExecutive, Non-Independent Director of the Bank.

The detailed profile of Mr. Madhavan Menon recommended for re-appointed in the ensuing Annual General Meeting will be provided in the Notice of the Annual General Meeting for the benefit of shareholders as per the provisions of the Companies Act, 2013, SEBI Listing Regulations and the Secretarial Standard on General Meetings (SS-2).

INDEPENDENT DIRECTORS - COMPLIANCE STATUS

The Bank fully satisfies the requirements of Section 149 of the Companies Act, 2013 and Regulation 17 of the SEBI Listing Regulations in connection with the appointment of Independent Directors and the following are the Independent Directors of the Bank as on the date of this report.

Sl. No	Name of the Independent Director	Term	Term of Appointment is up to
1	Mrs. Bhama Krishnamurthy (DIN: 02196839)	Second	September 28, 2024
2	Mrs. Sharmila Abhay Karve (DIN: 05018751)	First	July 19, 2023*
3	Mr. Sudhin Bhagwandas Choksey (DIN: 00036085)	First	January 30, 2024
4	Mr. Sunil Srivastav (DIN: 00237561)	First	June 7, 2024
5	Mr. Sharad Kumar Saxena (DIN: 08238872)	First	February 18, 2025
6	Mr. Biswamohan Mahapatra (06990345)	First	June 19, 2028

*Vide postal ballot resolution dated December 8,2022, shareholders have approved the re-appointment for a period of five (5) years, commencing from July 20, 2023, up to July 19, 2028 (both dates inclusive).

The performance of the Independent Directors is subject to evaluation as per Section 149(8) of the Companies Act, 2013 and read with Schedule IV to the said Act.

The Board is confident about their integrity, expertise and experience in the relevant functional areas.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have confirmed of having complied with the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) of the SEBI Listing Regulations read with 25(8) of the Regulations that they meet the criteria of independence laid down thereunder. Further, they have also complied with the Code for Independent Directors prescribed in Schedule IV to the Companies Act, 2013 and the Code of Conduct and Ethics for Board

of Directors and Senior Management Personnel of the Bank. Based on the declarations submitted by the Independent Directors, Board is of the opinion that, they fulfil the conditions specified in the Act and SEBI LODR and are independent of the management. There has been no change in the circumstances affecting their status as independent directors of the Bank.

Pursuant to rule 6(3) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, the Independent Directors of the Bank have affirmed that, they had registered as an Independent Director in the Independent Directors Data Bank as required under rule 6(1) and 6(2) of the Companies (Appointment and Qualifications of Directors) Rules, 2014 and had also complied with the requirements of passing the online proficiency self- assessment test/ exempted from online proficiency self- assessment test in terms of Rule 6(4) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended.

Board is of the opinion that Independent Directors appointed since the date of last report and up to the date of this report are persons of integrity, and has the necessary knowledge, experience and expertise and further, the Board has ensured that the independent directors have also complied with the requirements of passing the online proficiency self-assessment test/ exempted from online proficiency self-assessment test in terms of Rule 6(4) of the Companies (Appointment and Qualifications of Directors) Rules, 2014, as amended for being appointed/continue to be appointed as an Independent Director of the Bank.

FAMILIARISATION PROGRAMMES OF INDEPENDENT DIRECTORS

All directors including Independent Directors are familiar with their roles, rights and responsibilities in the Bank at the time of appointment and also on a recurrent basis. The Bank facilitates familiarisation programme and other programmes including Certification programme in IT and Cyber Security for its directors.

The details of various programmes undertaken/ arranged for familiarizing the Independent Directors and other programmes arranged for the directors are disclosed in the Report on Corporate Governance, which forms part of this Report.

Details of familiarisation programmes attended by all Directors including Independent Directors are provided at https://www.csb.co.in/pdf/Disclosure_ on_Familiarisation_Programmes_for_Independent_ Directors_of_the_Bank_14032023.pdf, pursuant to regulation 46 of SEBI Listing Regulations.

appointment/changes in key managerial

PERSONNEL

Mr. Pralay Mondal, Deputy Managing Director was elevated and appointed as the Managing Director & CEO of the Bank, for a period of three (3) years, with effect from September 15, 2022, up to September 14, 2025 (both dates inclusive). He has been designated as Key Managerial Personnel with effect from his date of appointment as Deputy Managing Director on February 17, 2022.

Mr. Satish Gundewar was appointed as Chief Financial Officer and as Key Managerial Personnel of the Bank with effect from June 5, 2023, in place of Mr. B. K. Divakara, who ceased to be the Chief Financial Officer of the Bank with effect from the close of office hours on June 4, 2023, as part of the change in the Bank''s management structure. Mr. B. K. Divakara ceased to be Key Managerial Personnel with effect from the said date.

Mr. Sijo Varghese, Company Secretary, continues to be the Key Managerial Personnel as per the provisions of the Companies Act, 2013.

BOARD AND ITS COMMITTEES Board and Number of Meetings

Regular meetings of the Board are held to discuss and decide on various business policies, strategies and other businesses. Due to business exigencies, certain decisions are taken by Board through resolution passed by circulation from time to time.

The Board met eighteen (18) times during the FY 202223 and the gap between the said meetings did not exceed the limit of 120 days, as prescribed under the relevant provisions of the Act, the relevant Rules made thereunder and the applicable SEBI Listing Regulations.

The schedule of the meetings of the Board is fixed on a yearly basis and circulated in advance to the members of the Board for their consideration and approval.

Detailed information on the meetings of the Board is included in the report on Corporate Governance, which forms part of this Report.

Committees of the Board

The Bank has eleven sub-committees of the Board and the same have been formed as part of the best corporate governance practices and/or in compliance with the requirements of the relevant provisions of applicable laws and regulatory prescriptions.

The details with respect to the compositions, powers, roles, terms of reference, etc., of the above Committees are given in detail in the Report on Corporate Governance which forms part of this Report.

AUDIT COMMITTEE

The Bank has constituted the Audit Committee of the Board is in terms of the extant guidelines of Reserve Bank of India (RBI), provisions of the Companies Act, 2013 and SEBI Listing Regulations.

The Committee discharges the functions laid down in the Companies Act, 2013 and those prescribed by the Reserve Bank of India and SEBI Listing Regulations. It also discharges the functions delegated by the Board of Directors from time to time. The Committee acts as an effective tier to the Board in the matters of inspection, audit and internal control system.

Board has accepted all the recommendations of the Audit Committee. The composition, role and functions of Committee, is provided in the Report on Corporate Governance, which forms part of this annual report.

ANNUAL EVALUATION OF PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013, the SEBI Listing Regulations and also in line with Board evaluation policy, Bank has put in place criteria for annual evaluation of performance of Chairperson, Managing Director & CEO, Executive Directors, Nonexecutive Directors, Independent Directors, Board Level Committees and the Board as a whole.

The performance of the members of the Board other than independent Directors and the Board as a whole has been evaluated separately at the meeting of the Independent Directors.

The performance of the independent Directors has been reviewed by the Board as provided for under Section 149(8) read with Schedule IV of the Companies Act, 2013.

The Statement indicating the manner in which formal annual evaluation of the Directors, Committees of the Board and the Board are given in detail in the report on Corporate Governance, which forms part of the Annual Report.

The Nomination and Remuneration Committee of the Board annually reviews and approves the criteria and the mechanism for carrying out the said exercise effectively.

The Board evaluation policy is displayed on the website of the Bank at: https://www.csb.co.in/pdf/Board-Evaluation-Policy-10052023.pdf

PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Considering the nature of activities of the Bank, with respect to the provisions of Section 134(3)(m) of the Companies Act, 2013 relating to conservation of energy and technology adoption, the Bank is constantly pursuing and making all-out efforts to achieve the desired goals as contained in the Act.

Ensuring compliance of the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule (8)(3) of the Companies (Accounts) Rules, 2014, the relevant disclosures to be made are as under:

a) Conservation of Energy

All attempts are being made to reduce energy consumption to the maximum extent possible. As part of these measures, the Bank is installing LED lights and other energy saving equipments in a phased manner across.

b) Technology Absorption

The required technology absorption is being made considering the nature of activities undertaken by the Bank.

c) Foreign Exchange Earnings and Outgo

Foreign Exchange earnings and outgo are part of the normal banking business of the Bank. Being an Authorised Dealer in Foreign Exchange, the Bank has been taking all possible steps to augment export credit.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS

During the financial year 2022-23, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and the Bank''s operations in future.

MAINTENANCE OF COST RECORDS

Being a banking company the Bank is not required to make and maintain such accounts and cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

CEO & CFO CERTIFICATION

Pursuant to Regulation 17(8) of the SEBI Listing Regulations, the Certificate issued by Mr. Pralay Mondal, Managing

Director & CEO and Mr. B.K. Divakara, Chief Financial Officer of the Bank, for the financial year ended March 31, 2023, was placed before the Board at its meeting held on April 28, 2023.

INFORMATION UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Bank has formulated and adopted a Policy on Prevention of Sexual Harassment of Women at workplace.

The Bank has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The information relating to complaints received and redressed during the financial year 2022-23, is disclosed in the Report on Corporate Governance, which forms part of the Annual report.

STRICTURES AND PENALTIES

There are no instances of non-compliance by the Bank and no penalties or strictures have been imposed on the Bank by the Stock Exchange(s) and/or SEBI and/or any other statutory authorities on matters relating to capital market activities, during the last three years.

DISCLOSURE UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

Being a banking company, the disclosures required as per Rule 8(5)(xi)&(xii) of the Companies (Accounts) Rules, 2014, on the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year and the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, are not applicable to the Bank.

However, being a banking company, during the period under review, your Bank was part of the Corporate Insolvency Resolution Process (CIRP) initiated against the two corporate debtors before NCLT for a total book value of ''2.78 crore.

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 of the Companies (Management and Administration) Rules, 2014, as amended, the Annual Return (MGT-7) as on March 31, 2023, will be displayed on the website of the Bank at: https://csb.co.in/investor- relations > General meetings > Annual General Meeting - 2023.

ACKNOWLEDGEMENTS AND APPRECIATIONS

The Board of Directors is grateful to the Government of India, Reserve Bank of India, Securities and Exchange Board of India, Ministry of Corporate Affairs, Stock Exchanges, Insurance Regulatory and Development Authority of India, the domestic banking community, the Registrar and Share Transfer Agents, Depositories and rating agencies for their continued support and guidance. The Board of Directors would like to take this opportunity to express sincere thanks to its valued clients and customers for their continued patronage.

The Board also expresses its deep sense of appreciation and heartfelt thanks to every member of the CSB family

for their strong work ethics, excellent performance, professionalism, teamwork, commitment and initiatives which has led the Bank towards reinforcing its customer centric image and making commendable progress in today''s challenging environment. The Board looks forward to their continued, dedicated and sincere service to take the Bank to new heights.

Finally, the Board of Directors wish to record their deep sense of obligation and gratitude to all the Shareholders, well-wishers and all other stakeholders of the Bank for their patronage and look forward to continuing this mutually supportive and beneficial relationship in future as well.

By Order of the Board Sd/-

Place: Thrissur Date: June 22, 2023

Bhama Krishnamurthy

Chairperson (DIN: 02196839)