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Notes to Accounts of IDBI Bank Ltd.

Mar 31, 2023

RBI vide circular no DBR.No.BP.BC.83/21.06.201/2015/16 dated March 01, 2016 has given discretion to Banks to consider Revaluation Reserve/ Foreign Currency Translation Reserve / DTA for purpose of computation of capital Adequacy as CET-1 capital ratio. The Bank has exercised the option in the above computation.

Revaluation Reserve has been recognized under CET-1 capital at the discount of 55% in accordance with extant RBI guidelines. This had resulted in increase in CET-1 capital in the previous year ending March 31,2022, besides recognition of full year profit.

b) Draw Down from Reserves

The Bank has not undertaken any drawdown from reserves during the year ended March 31,2023 and March 31,2022.

c) Set-off of Accumulated Losses

During the current year, the Bank has set off its accumulated losses of '' 45,396 crore as on April 01,2021 by utilizing the balance outstanding to the credit of Securities Premium Account of the Bank on the said date after obtaining approval from its shareholders, Reserve Bank of India and National Company Law Tribunal order dated March 29, 2023.

Qualitative disclosure around Liquidity Coverage Ratio (LCR)

In the backdrop of the global financial crisis that started in 2007, the Basel Committee on Banking Supervision (BCBS) proposed certain reforms to strengthen global capital and liquidity regulations with the objective of promoting a more resilient banking sector. In this direction BCBS published guidelines on âBasel III: The Liquidity Coverage Ratio and liquidity risk monitoring tools'' in January 2013 and the âLiquidity Coverage Ratio Disclosure Standards'' in January 2014. Accordingly, Reserve Bank of India, vide its circular dated June 09, 2014, issued guidelines on Liquidity Coverage Ratio (LCR).

The LCR promotes short-term resilience of banks to potential liquidity disruptions by ensuring that they have sufficient high quality liquid assets (HQLAs) to survive an acute stress scenario lasting for 30 days. The LCR standard aims to ensure that a bank maintains an adequate level of unencumbered HQLAs that can be converted into cash to meet its liquidity needs for a 30 calendar day time horizon under a significantly severe liquidity stress scenario specified by supervisors.

High Quality Liquid Assets (HQLA):

Under the standard, banks must hold a Stock of unencumbered HQLA to cover the total net cash outflows over 30-day period under the prescribed stress scenario. In order to qualify as HQLA, assets should be liquid in markets during times of stress and, in most cases, be eligible for use in central bank operations. The HQLA of the Bank mainly comprise of SLR investments over and above mandatory requirement, liquidity available by way of borrowing under Marginal Standing Facility (2% of NDTL), Facility to Avail Liquidity for Liquidity Coverage Ratio (16% of NDTL) & other securities as may be permitted by Reserve Bank of India from time to time.

Total net cash outflows:

Total expected cash out flows are calculated by multiplying the outstanding balances of various categories or types of liabilities and off-balance sheet commitments by the rates at which they are expected to run off or be drawn down. Total expected cash inflows are calculated by multiplying the outstanding balances of various categories of contractual receivables by the rates at which they are expected to flow.

Liquidity Management:

The Bank has well organized liquidity risk management structure as enumerated in ALM Policy which is approved by the Board. The Asset Liability Management Committee (ALCO) of the Bank monitors & manages liquidity and interest rate risk in line with the business strategy. ALM activity including liquidity analysis & management is conducted through coordination between various ALCO support groups residing in the functional areas of Balance Sheet Management, Treasury Front Office, Budget and Planning etc. ALCO directives and ALM actions are implemented by the business groups and verticals.

The Bank during the quarter ended 31^st March 2023, maintained average HQLA of '' 64,956 crore after factoring eligible haircuts. HQLA is mainly driven by Level 1 Assets and comprises mainly of Government securities and T-bills which constitute more than 90% of HQLA as on 31^st March 2023. Bank has well diversified source of funds which mainly comprise of deposits, with top 20 depositors contributing 8.04% of total deposits as on 31^st March 2023.

The average LCR for the quarter ended March 31, 2023 was at 135.66% above the present prescribed minimum requirement of 100%.

Qualitative disclosure around Net Stable Funding Ratio (NSFR)

In the backdrop of the global financial crisis that started in 2007, the Basel Committee on Banking Supervision (BCBS) proposed certain reforms to strengthen global capital and liquidity regulations with the objective of promoting a more resilient banking sector. In this direction BCBS published guidelines on âBasel III: The Net Stable Funding Ratio'' in October 2014 and the NSFR standard to be effective from January 01, 2018. Accordingly, Reserve Bank of India, vide its circular dated May 17, 2018, issued final guidelines on Net Stable Funding Ratio (NSFR).

The NSFR promotes resilience over a longer-term time horizon by requiring banks to fund their activities with more stable sources of funding on an ongoing basis. A sustainable funding structure is intended to reduce the probability of erosion of a bank''s liquidity position due to disruptions in a bank''s regular sources of funding that would increase the risk of its failure and potentially lead to broader systemic stress. The NSFR limits overreliance on short-term wholesale funding, encourages better assessment of funding risk across all on- and off- balance sheet items, and promotes funding stability.

Available Stable Funding (ASF

The amount of ASF is measured, based on the broad characteristics of the relative stability of an institution''s funding sources, including the contractual maturity of its liabilities and the differences in the propensity of different types of funding providers to withdraw their funding. The amount of ASF is calculated by first assigning the carrying value of an institution''s capital and liabilities to one of five categories as mentioned in RBI circular. The amount assigned to each category is then multiplied by an ASF factor, and the total ASF is the sum of the weighted amounts. Carrying value represents the amount at which a liability or equity instrument is recorded before the application of any regulatory deductions, filters or other adjustments.

Required Stable Funding (RSF)

The amount of required stable funding is measured based on the broad characteristics of the liquidity risk profile of an institution''s assets and OBS exposures. The amount of required stable funding is calculated by first assigning the carrying value of an institution''s assets to the categories listed in RBI circular. The amount assigned to each category is then multiplied by its associated required stable funding (RSF) factor, and the total RSF is the sum of the weighted amounts added to the amount of OBS activity (or potential liquidity exposure) multiplied by its associated RSF factor.

Liquidity Management:

Bank maintained Available Stable Funding (ASF) of '' 2,30,018 crore and Required Stable Funding (RSF) of '' 1,91,664 crore as on 31^st March 2023. Available Stable Funding (ASF) is mainly driven by total regulatory capital and deposits with maturity over one year from retail customers, small business customers, non-financial corporate customers and PSUs. Required Stable Funding (RSF) is mainly driven by unencumbered government securities and assets with maturity over one year. HQLAs (High Quality Liquid Assets) after applying hair-cut constitute less than 2 % of weighted RSF, as HQLAs can be easily sold in the market or can be used as collateral for sourcing additional funds..

The NSFR of the Bank for Quarter ending March 31,2023 is at 120.01 % as against the regulatory limit of 100%.

Movement of provision is prepared on annual basis by comparing the positions as at the respective reporting period end.

Note: As per RBI circular DBR.No.BP.BC.102/21.04.048/2017-18 dated April 2, 2018 IFR is to be created with an amount which is not less than lower of net profit on sale of investments during the year or net profit for the year less mandatory appropriations until the amount of IFR is at least 2 percent of the HFT and AFS portfolio, on a continuing basis.

Bank has transferred to IFR until the amount of IFR is at least 2% of the Gross HFT and AFS portfolio as on March 31,2023.

c) Sales and transfers to/from Held to Maturity (HTM) category

During the year ended March 31,2023 (and previous year ended March 31,2022), the value of sales and transfers of securities to/from HTM category has not exceeded 5% of the book value of the investments held in HTM category at the beginning of the year.

For the purpose of above limit following are excluded:

Onetime transfer to/from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year, sale to RBI under pre-announced Open Market Operation (OMO) auctions, direct sales from HTM for bringing down SLR holdings, repurchase of government securities by GOI, repurchase of state development loans by respective state governments and additional shifting of securities permitted by RBI.

e) Divergence in Asset Classification and Provisioning for NPAs as per RBI Circular DBR.BP.BC.No.63/21.04.018/ 2016-17 dated April 18, 2017, RBI Circular No: RBI/2018-19/157 DBR.BP.BC.No.32/21.04.018/2018-19 dated April 01,2019 & RBI/2022-23/130 DOR.ACC.REC.No.74/21.04.018/2022-23 dated October 11, 2022

(g) Unhedged Foreign Currency Exposure

The Bank, as detailed in its Credit Policy, monitors the Unhedged Foreign Currency Exposure of its borrower and pursues its clients to hedge their forex exposure to minimize the losses due to adverse exchange rate fluctuation. Bank obtains information on Un-hedged Foreign Currency Exposure from its customers on a periodic basis and maintains the same in an internally developed system and follows the methodology for computation of likely loss on account of exchange rate movement. The incremental provisioning for the year ending March 31,2023 towards this exposure is '' 8 crore. (Previous year: âNil''). The capital held towards the risk stood at '' 40 crore as on March 31,2023 (Previous Year - '' 69 crore as on March 31,2022).

Qualitative disclosures

(a) The structure and organization for management of risk in derivatives trading,

The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc. The Bank has a well-defined structure to manage these risks, consisting of risk policy, risk management organization, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by Chief Risk Officer.

b) The scope and nature of risk measurement, risk reporting and risk monitoring systems

The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks like credit risk, market risk, operational risk etc. in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with periodic reporting to Risk Management Committee of the Board as well as to the Board.

(c) Policies for hedging and / or mitigating risk and strategies and processes for monitoring the continuing effectiveness of hedges / mitigants

Risk exposures in derivatives transactions are measured/ assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, greeks, stop loss etc. Physically-settled foreign exchange contracts are settled on payment versus payment (PvP) basis so as to mitigate principal risk resulting from failed trades. The Bank mitigates replacement cost risk by effective use of close-out netting agreements, exchange of margin, collaterals etc, wherever applicable. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

(d) Accounting policy for recording hedge and non-hedge transactions; recognition of income, premiums and discounts; valuation of outstanding contracts; provisioning, collateral and credit risk mitigation.

The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 "Significant Accounting Policies of the Bank".

(d) Disclosure on Penalties imposed by Reserve Bank of India:

RBI in the Risk Assessment Report for FY 2020-21 had assessed divergence which trigged public disclosure and therefore malus clause was invoked in terms of the RBI guidelines dated November 4, 2019 on Compensation of Whole Time Directors/ Chief Executive Officers/ Material Risk Takers & Control Function Staff. The invocation of malus clause resulted in cancellation of outstanding deferred remuneration of the 3 WTDs aggregating '' 1.07 crore pertaining to FY 2020-21. Please refer Disclosures on Remuneration (Quantitative Disclosures) under Schedule 18 point no. A 13 (2).

Disclosures on Remuneration

f Qualitative disclosures

(a) Information relating to the composition and mandate of the Nomination and Remuneration Committee:

Nomination and Remuneration Committee (NRC) comprises of seven members with an Independent Director as its Chairman, and one Government Nominee Director, one LIC Nominee Director and four other Independent Directors as other members. The Committee fulfils the mandate / terms of reference provided under Section 178 of the Companies Act, 2013, Regulation 19 and Part D of Schedule II of the LODR Regulations, SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and RBI guidelines in respect of fit and proper status of Directors as under :

Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board of Directors a policy relating to remuneration of the directors, key managerial personnel and other employees;

To specify the manner for effective evaluation of performance of the Board, its Committees and individual directors, to be carried out either by the Board, by the NRC or by an independent external agency and review its implementation and compliance;

Formulation of criteria for evaluation of performance of Independent Directors and the Board of Directors;

Devising a policy on diversity of Board of Directors;

To identify persons who are qualified to become directors and who may be appointed in senior management with the criteria laid down, and recommend to the Board of Directors their appointment and removal;

To recommend to the Board the appointment and removal of Directors in accordance with the criteria laid down in the Directors'' Appointment and Evaluation Policy;

For every appointment of an independent director, the Nomination and Remuneration Committee shall evaluate the balance of skills, knowledge and experience on the Board and on the basis of such evaluation, prepare a description of the role and capabilities required of an independent director. The person recommended to the Board for appointment as an independent director shall have the capabilities identified in such description. For the purpose of identifying suitable candidates, the Committee may:

a. Use the services of external agencies, if required;

b. Consider candidates from a wide range of backgrounds, having due regard to diversity; and

c. Consider the time commitments of the candidates.

To undertake a process of due diligence to determine the suitability of any person for appointment / continuing to hold appointment as a director on the Board, based upon qualification, expertise, track record, integrity, âfit and proper'' criteria, positive attributes and independence (if applicable) and on the basis of the report of performance evaluation of directors including independent directors and formulate the criteria relating thereto;

Formulation of Remuneration Policy for Directors, KMPs, etc.

Recommend to the Board, all remunerations, in whatever form, payable to the senior management;

To work in close coordination with Risk Management Committee to achieve effective alignment between compensation and prudent risk-taking;

To oversee the compensation system''s design and operations to ensure that the system operates as intended and is also consistent with the principles outlined by the Financial Stability Board;

To oversee framing, review and implementation of compensation policy and make annual remuneration decisions for Chief Executive Officer/Whole Time Directors/Material Risk Takers plus Risk Control and Compliance staff (for ratification by the Board);

To ensure that the cost to income ratio of the Bank supports the compensation consistent with maintaining sound capital adequacy ratio;

c\ -o -o

To have supervisory oversight regarding implementation of compensation practices and policies of the Bank. To ensure complete compliance with all disclosure norms as prescribed by the various statutes relevant to the banking sector and industry in general;

To review specific criteria for Malus and Clawback every year;

To fix performance parameters & final payout for Cash based incentives and share-based incentives every year;

To identify Material Risk Takers (MRTs) whose actions have a material impact on the risk exposure of the Bank, and who satisfy the qualitative and quantitative criteria;

To act as the Compensation Committee as prescribed under Regulation 5 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. To administer and supervise the Employee Stock Option Scheme/Employee Stock Appreciation Rights (SAR) Scheme of the Bank as mandated under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and to inter-alia approve the grades of employees to whom options/SARs could be granted as well as determine the performance level and/or any other criteria required to be adopted for grant of options/SARs;

To determine and finalize all the terms and conditions governing the Employee Stock Option Scheme/Employee Stock Appreciation Rights Scheme of the Bank including any variation thereof subject to receipt of requisite approval, if required under regulatory and/or other applicable laws;

To suggest amendments to any stock option plan or SAR scheme, provided that all amendments to such plans/schemes shall be subject to consideration and approval of the Board;

To review the Compensation Policy annually and to review the Employee Stock Option Scheme/Employee Stock Appreciation Rights Scheme of the Bank as and when required under regulatory guidelines/other laws;

â¢o c\

To carry out any other role as may be mandated to it under regulatory / statutory guidelines from time-to-time.

As on March 31, 2023, the NRC comprised of seven members with Shri Gyan Prakash Joshi (Independent Director) as its Chairman, Shri Sushil Kumar Singh (Government Nominee Director), Shri Mukesh Kumar Gupta (LIC Nominee Director) and Shri Bhuwanchandra B Joshi, Shri N. Jambunathan, Shri Deepak Singhal & Shri T. N. Manoharan (Independent Directors) as other members.

(b) Information relating to the design and structure of remuneration processes and the key features and objectives of remuneration policy:

A description of the scope of the Bankâs remuneration policy, including the extent to which it is applicable to foreign subsidiaries and branches:

The Bank has formulated its Compensation Policy based on the Reserve Bank of India guidelines issued vide Circular No.DOR.Appt.BC.No.23/29.67.001/2019-20 dated November 4, 2019. The Compensation Policy is applicable to employees appointed at Bank''s domestic branches/offices and also to the employees posted at its foreign branches. It is not applicable to employees of subsidiaries of the Bank.

This category includes MD & CEO and two Deputy Managing Directors (DMDs). The remuneration structure for WTDs comprises of fixed and variable pay and variable pay is payable as a percentage of fixed pay and is linked to the Bank''s performance. The compensation structure for MD & CEO and other Whole Time Directors (WTDs) of the Bank is fixed by NRC / Board and is subject to approval of Reserve Bank of India in terms of Section 35 B of the Banking Regulation Act, 1949. The payment of compensation also requires approval of the shareholders of the Bank in the General Meeting pursuant to clause 119 of Articles of Association of the Bank read with Section 197 of the Companies Act, 2013 and Section 35B (1) of Banking Regulation Act 1949.

The positions of Material Risk Takers (MRTs) & Control Function Staff are held by cadre officers of IDBI Bank and their fixed pay structure comprising of pay and allowances is equivalent to the pay & allowances being offered by IDBI Bank to the other parallel grade officers. Variable pay is payable as a percentage of fixed pay and is linked to individual and Bank''s performance for the MRTs. Variable Pay of Control Function Staff is majorly linked to their individual performance; overall business performance of the Bank is reckoned only for ascertaining primary eligibility.

As per the current policy, the fixed pay structure of subordinate staff, clerical staff and officer''s upto the grade of Executive Director is drawn on the lines of the Indian Banks'' Association (IBA) pay scales and allowances and runs co-terminus with the industry level settlements for a period of 5 years. Variable Pay as a percentage/ proportion of fixed pay is payable to this category of employees and is linked to the individual and Bank''s performance.

The Bank shall follow a compensation policy that is internally equitable and externally competitive, while complying, at all times, with the guidelines set forth by the Reserve Bank of India (RBI) and the Financial Stability Board (FSB). The compensation levels shall be designed to enable attraction & retention of the most suitable talent for delivering on the Bank''s business plans.

The positions of Executive Director-Chief Risk Officer, Executive Director-Chief Compliance Officer, Executive Director-Chief Financial Officer and Executive Director-Audit, Fraud Risk Management Group & Internal Auditor are held by cadre officers of IDBI Bank and their pay scale and allowances i.e. fixed pay is equivalent to the pay scales and allowances being offered to other parallel grade officers and is finalized by the Bank with the approval of the Board. The Variable Pay is however majorly linked to their individual performance; overall business performance of the Bank is reckoned only for ascertaining primary eligibility.

In order to align remuneration with the risk and the time horizons over which they could emerge, a substantial portion of the senior management remuneration including that of MD & CEO and Deputy Managing Directors is under variable pay arrangement. The variable compensation is payable in the form of cash and non-cash components and is deferred over a period of 3 years or more. The impact of remuneration adjustments is linked to actions taken by employees and/or business units, and their impact on the level of risk taken on by the bank. At higher level of responsibility, the proportion of variable pay is higher. The amount of variable pay can even be reduced to zero depending on the financial performance of the Bank. In addition, variable pay is subject to the malus and clawback provisions of the Compensation Policy of the Bank.

The Variable Pay shall be a mix of cash and share-linked instruments with proper balance between cash and share linked components in keeping with the RBI guidelines. The focus of share-based LTI will be on long-term shareholder value creation. In view of the same, share-based LTI shall be granted as a part of Variable Pay and it shall be fair valued on the date of grant by using the Black-Scholes Model or any other model as may be directed by the Regulator(s). Only in cases where the compensation by way of share-linked instruments is not permitted by statute/regulations, the entire variable pay can be in the form of cash.

The assessment of variable pay is based on achievement of Bank-wide performance parameters for Whole Time Directors. For Material Risk Takers (MRTs) and other employees the assessment of variable pay is based on achievement of individual as well as Bank-wide performance parameters. For Control Function staff the assessment of variable pay is majorly linked to their individual performance; overall business performance of the Bank is reckoned only for ascertaining primary eligibility.

If deferral period is 3 years, not more than 33.33 % of the total granted Share-based LTI shall vest at the end of first year. Further, not more than 33.33 % of total granted Share-based LTI shall vest at the end of second year. Similarly, in case deferral arrangement is four years, not more than 25% of total granted Share-based LTI shall vest in each of the first three years. Additionally, vesting shall not take place more frequently than on a yearly basis to ensure a proper assessment of risks before the application of ex-post adjustments.

Malus & Clawback provisions on variable pay (cash based & share-based LTI) would enable the NRC to reduce or cancel unvested awards and recover previously paid compensation in certain situations viz. divergence in Bank''s provisioning for NPAs, subdued or negative financial performance, misconduct or any other parameter deemed relevant by the NRC. Malus can be invoked in all the situations and clawback can be invoked in case of misconduct or any other parameter deemed relevant by the NRC. Invocation of Malus provisions would imply cancellation of partial or full deferred annual cash incentive and/or unvested LTI awards as on the date of discovery of applicable trigger. The clawback arrangement would imply recovery of annual cash incentives paid and LTI awards vested over the last five years from the date of discovery of the applicable trigger.

The Variable Pay shall be a mix of Cash & Share-based Long Term Incentive (LTI). Share-based LTI shall be granted as a part of Variable Pay and it shall be fair valued on the date of grant by using the Black-Scholes Model or any other model as may be directed by the Regulator(s). Share-based LTI shall be governed by the terms & conditions of the applicable scheme of the Bank, as amended from time-to-time. The employee category-wise target Variable Pay as a percentage of Annual Fixed Pay (subject to regulatory guidelines) shall be as recommended by the Nomination and Remuneration Committee and approved by the Board.

The Ministry of Corporate Affairs (MCA) had notified IFRS-converged Indian Accounting Standards (Ind AS) vide Notification dated February 16, 2015 and had also notified (vide press release dated January 18, 2016) the roadmap for applicability of Ind AS for Banks, Insurance companies and NBFCs from FY 2018-19. RBI advised all scheduled commercial banks to prepare financial statements for accounting periods beginning from April 1,2018 onwards in accordance with Ind AS and prescribed a timeframe for transition towards Ind AS. Consequent to this, IDBI had commenced implementation of Ind AS in preparation of financial results. RBI subsequently decided to defer the implementation of Ind AS for banking industry till further notice vide its Circular No. DBR.BP.BC. No. 29/21.07.001/2018-19 dated March 22, 2019. Further, RBI vide its communication dated August 08, 2021 decided to reduce the frequency of Pro-forma Ind AS Financial Statement submission from quarterly to half yearly. Accordingly Bank is submitting Ind AS Proforma Financial Statements on half yearly basis to RBI within the stipulated time.

As it is a beginning of transition to new set of Accounting Standards and awaiting notification of Financial Statements format by RBI as well as clarifications on applicability of various existing RBI Circulars under Ind AS environment, the Bank is required to formulate various policies papers (viz. Risk Management, Investments Policies), operational process setup and IT integration based on final guidelines to be issued by RBI, which will be continuously updated/modified/ evolved over a period of time. The key impact areas during the implementation of Ind AS for the Bank include effective interest rate accounting, fair valuation inputs, methodologies and assumptions, specific valuation considerations in many instruments, expected credit losses, employee stock options and implementation of technology systems.

During the year ended March 31, 2023, there were no breaches in respect of Single borrowers and Group of Connected Counterparties exposures of the Bank under LEF guidelines of RBI. Exposures to single counterparty borrower and group of connected counterparties were within the prudential exposure limits of 20% and 25% of eligible capital base i.e. Tier I Capital.

During the year ended March 31, 2022, there were no breaches in respect of single borrowers and group of connected counterparties exposures of the Bank. Exposures to single counterparty borrower and group of connected counterparties were within the prudential exposure limits of 20% and 25% of eligible capital base i.e. Tier I Capital as prescribed under the Large Exposure norms (net accounting value concept) of RBI.

During the previous FY 2021-22, the Bank had re-valued its Premises including leasehold / Freehold Lands & Residential/ Office buildings based on valuations made by independent valuers, using methodologies such as discounted cash flow, cost approach method, comparable sales method. An increase of '' 2,409 crore in carrying value of properties, arising on account of revaluation was credited directly to the Revaluation reserve. Similarly, a decrease of '' 73 crore in the carrying value of some properties, arising on account of revaluation was charged to profit and loss account. The WDV cost of fixed assets revalued during FY 2021-22 was '' 6,602 crore before revaluation.

Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the FY 2022-23''7 crore (Previous FY 2021-22 '' 15 crore) has been contributed to PFS and charged to Profit and Loss Account.

The Bank''s employees who have joined after April 1,2008 are covered by IDBI Bank Ltd. New Pension Scheme (IBLNPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the FY 2022-23, '' 177 crore (Previous FY 2021-22 '' 174 crore) has been contributed to IBLNPS and charged to Profit and Loss Account.

Business Segments have been identified and reported taking into account the target customer profile, the nature of products and services, the differing risks and returns, the organisation structure, the internal business reporting system and the guidelines prescribed by the RBI. Vide its circular dated April 7, 2022 on establishment of Digital Banking Units (DBUs), the RBI has prescribed reporting of Digital Banking Segment as a sub-segment of Retail Banking Segment. The proposed DBUs of the Bank have not commenced operations and having regard to the discussions of the DBU Working Group formed by Indian Banks'' Association (IBA) (which included representatives of banks and RBI), reporting of Digital Banking as a separate sub-segment of Retail Banking Segment will be implemented by the Bank based on the decision of the DBU Working Group.

During year ended March 31,2023, bank has made provision of '' 1,426 crore (Previous Year: Nil) under treasury portfolio for security receipts received against assignment of NPA loans. There is a corresponding reversal of provision of equivalent amount under corporate portfolio.

B. Long term contracts

The Bank has a process whereby periodically all long term contracts including derivative contracts are assessed for material foreseeable losses. At the year end, the Bank has reviewed and ensured that adequate provision as required under any law/ accounting standards for material foreseeable losses on such long term contracts including derivative contracts has been made in the books of account.

C. Pending litigations

The Bank''s pending litigations comprise of claims against the Bank primarily by the borrowers, customers and proceedings pending with Income Tax authorities. The Bank has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed the contingent liabilities where applicable, in its financial statements.

During the year ended March 31,2023, Bank has written off SASF securities to the extent of '' 1500 crore on March 24, 2023, after obtaining concurrence of Government of India, Ministry of Finance, Department of Financial Services (DFS). As on March 31,2023, the balance SASF stands fully provided with aggregate provision of '' 879 crore.

Pursuant to the provisions of Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to micro, small & medium enterprise. The Bank is in the process of compiling relevant information from its suppliers about their coverage under the said Act. In view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this Act is not expected to be material.

(a) The COVID-19 virus, a global pandemic affected the world''s economy over the last two to three years. The extent to which new wave of COVID-19 pandemic will impact the Bank''s operations and asset quality will depend on ongoing as well as future developments, which are uncertain at this stage. The management of the Bank is closely monitoring the developments in this regard, including the likelihood of rise in customer defaults, corresponding increase in provisioning requirements and taking necessary steps to mitigate the same.

(b) As at March 31,2023, the Bank held aggregate COVID-19 related provision of '' 116 crore (other than provisions held for restructuring under COVID-19 norms). During the Quarter ended March 31,2022, the Bank had reversed COVID-19 related provision of '' 747 crore in view of extant RBI guidelines.

(c) In terms of RBI''s circular on Resolution Framework 1.0 and Resolution Framework 2.0, Bank continues to hold regulatory provision aggregating to '' 315 crore as on March 31,2023. In addition, as on March 31,2023, Bank held contingency provision of '' 1836 crore for retail borrowers restructured under COVID RF 1, RF 2 and MSMER OTR framework.

The Bank has Board approved limit for Net Overnight Open Position (NOOP) fixed at '' 300 crore w.e.f. May 26, 2022. During the year the open position was within the approved limit and the average utilization was '' 127 crore (Prev. Year '' 78 crore). The maximum utilization during the year was at '' 223 crore on September 30, 2022. (Prev. Year '' 146 crore on April 15, 2021).

During the year ended March 31, 2023, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank to or in any other persons or entities, including foreign entities (âIntermediariesâ) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Bank (Ultimate Beneficiaries). Further, The Bank has not received any fund from any parties (Funding Party) with the understanding that the Bank shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Bank (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

IDBI Asset Management Ltd., IDBI MF Trustee Company Ltd., LIC Mutual Fund Asset Management Ltd. and LIC Mutual Fund Trustee Private Ltd. entered into Scheme Transfer Agreement on December 29, 2022 for transfer of IDBI mutual fund schemes

to LIC MF. Competition Commission of India and Securities Exchange Board of India approval for the proposed transfer of AUM has been received on March 23, 2023 and April 03, 2023 respectively. The transaction is likely to be concluded during June 2023. As the transfer is pending, there is no impact on financial results for the Year ended March 31,2023.

Figures of the previous year, are disclosed in brackets and are regrouped/ rearranged, so as to confirm with the presentation made for the current year and also pursuant to the requirement of Master Direction on financial results - Presentation and disclosure issued by Reserve Bank of India dated August 30, 2021 (updated as on February 20, 2023), as amended and wherever considered necessary.

Mar 31, 2021

During the year ended March 31,2021, the value of sales and transfers of securities to/from HTM category excluding onetime transfer to/from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year and sale to RBI under pre-announced Open Market Operation (OMO) auctions has not exceeded 5% of the book value of the investments held in HTM category at the beginning of the year. The same is in regard to RBI extant guidelines for compliance with SLR requirements.

The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

The Bank has a well-defined structure to manage these risks, consisting of risk policy, risk management organization, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by an Executive Director designated also as Chief Risk Officer. The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with periodic reporting to Risk Management Committee of the Board as well as to the Board.

Risk exposures in derivatives transactions are measured/ assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, Greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 âSignificant Accounting Policies of the Bankâ.

The Bank has Board approved limit for Net Overnight Open Position (NOOP) fixed at '' 400 Crores w.e.f November 01,2017. During the year the open position was within the approved limit and the average utilization was '' 122.69 Crores. The maximum utilization during the year was at '' 185.13 Crores on December 11,2020.

Disclosures as per RBI circular RBI/2016-17/122 DBR.No.BP.BC.34/21.04.132/2016-17 dated November 10, 2016

Disclosures on Flexible Structuring of Existing Loans

There were no cases of flexible structuring during the year ended March 31,2021 and the previous year ended March 31,2020.

Disclosures on Strategic Debt Restructuring Scheme (accounts which are currently under the stand-still period)

There were no cases of strategic debt restructuring accounts which are currently under stand still period as on both, March 31,2021 and March 31,2020

Disclosures on Change in Ownership outside SDR Scheme (accounts which are currently under the standstill period)

There were no cases of change in ownership outside SDR scheme accounts which are currently under stand still period as on both, March 31,2021 and March 31,2020.

Disclosures on Change in Ownership of Projects Under Implementation (accounts which are currently under the stand-still period)

There were no cases of change in ownership of projects under implementation which are currently under stand still period as on both, March 31,2021 and March 31,2020.

In terms of the RBI guidelines, banks are required to disclose the divergence in asset classification and provisioning consequent to RBI''s annual supervisory process in their notes to accounts to the financial statements, wherever the additional provisioning assessed / additional gross NPAs identified by RBI exceeds the threshold specified by RBI. The threshold for provisioning is 10 per cent of the reported profit before provisions and contingencies for the reference period or additional gross NPAs identified by RBI exceed 15 per cent of the published incremental Gross NPAs for the reference

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The SARS-CoV2 virus responsible for COVID-19 has resulted in a significant decline and volatility in global and Indian markets and economic activity. Implementation of lockdown and its extensions have resulted in disruptions of business and common life. The Bank is gearing itself on all fronts to meet the challenges imposed by COVID including the likelihood of rise in customer defaults and an increase in provisioning requirements. The second wave of COVID from mid of March 2021 is again threatening to disrupt the economic activities in many states, where the pandemic is more severe with possibilities of lockdown getting extended in case the situation does not improve. The Bank''s capital and liquidity position is strong and would continue to be the focus area for the Bank during this period.

In accordance with the RBI notification DOR.STR.REC.4/21.04.048 /2021-22 dated April 7, 2021, the Bank is required to refund / adjust âinterest on interest'' to borrowers. The methodology for calculation of such interest on interest has been recently circulated by Indian Bank''s Association. The Bank is in process of implementing the same. At March 31,2021 the Bank has created liability of '' 188.94 Crores towards estimated interest refund and reduced same from interest income.

$ Working funds are reckoned as average of total assets (excluding accumulated losses, if any) as reported to Reserve Bank of India in Form X under Section 27 of the Banking Regulation Act, 1949, during the 12 months of the financial year and average of total assets (excluding accumulated losses, if any) of Dubai branch.

The LCR requirement is binding on banks from January 1, 2015. LCR was to be maintained at 100% from January 01,2019. However, RBI in its circular dated April 17, 2020 (RBI/2019-20/217 DOR.BPBC.No.65/21.04.098/2019-20), on account of the Covid19 pandemic, permitted Banks to maintain LCR as under.

Under the standard, banks must hold a Stock of unencumbered HQLA to cover the total net cash outflows over a 30-day period under the prescribed stress scenario. In order to qualify as HQLA, assets should be liquid in markets during times of stress and, in most cases, be eligible for use in central bank operations. The HQLA of the Bank mainly comprise of SLR investments over and above mandatory requirement, liquidity available by way of borrowing under Marginal Standing Facility (3% of NDTL), Facility to Avail Liquidity for Liquidity Coverage Ratio (15% of NDTL) & other securities issued by PSEs or non-financial corporates.

/ Total net cash outflows :

Total expected cash out-flows are calculated by multiplying the outstanding balances of various categories or types of liabilities and off-balance sheet commitments by the rates at which they are expected to run off or be drawn down. Total expected cash inflows are calculated by multiplying the outstanding balances of various categories of contractual receivables by the rates at which they are expected to flow in.

Liquidity Management:

The average LCR of the Bank for FY2020-21 is at 155.59%.

Disclosure on Remuneration

I Qualitative disclosures

(a) Information relating to the composition and mandate of the Remuneration Committee:

Name, composition and mandate of the main body overseeing remuneration:

Nomination and Remuneration Committee (NRC) comprises of six members with an Independent Director as its chairman, and 2 Government Nominee Directors, an LIC Nominee Director and two other Independent Directors as other members. The Committee fulfills the mandate/ terms of reference provided under Section 178 of the Companies Act, 2013, Regulation 19 and Part D of Schedule II of the LODR Regulations and RBI guidelines in respect of fit and proper status of Directors as under :

Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board of Directors a policy relating to appointment and evaluation of Directors;

Formulation of criteria for evaluation of performance of Independent Directors and the Board of Directors;

To identify persons who are qualified for appointment as Independent Directors in accordance with Directors'' Appointment and Evaluation Policy;

To recommend to the Board the appointment and removal of Directors in accordance with the criteria laid down in the Directors'' Appointment and Evaluation Policy;

Formulation of Remuneration Policy for Directors, KMPs, etc.;

Recommend to the Board, all remuneration, in whatever form, payable to the senior management;

To work in co-ordination with Risk Management Committee in order to achieve effective alignment between remuneration and risks

As on March 31, 2021, the NRC comprised of six members with Shri Gyan Prakash Joshi (Independent Director) as its chairman, Ms. Meera Swarup & Shri Anshuman Sharma (Government Nominee Directors), Shri Rajesh Kandwal (LIC Nominee Director), and Shri B. B. Joshi & Shri N. Jambunathan (Independent Directors) as other members.

External consultants whose advice has been sought, the body by which they were commissioned, and in what areas of the remuneration process

In order to align the compensation structure of the Managing Director & Chief Executive Officer (MD & CEO) / Whole Time Directors (WTDs) with the guidelines issued by RBI on November 04, 2019, IDBI Bank has engaged the services of a leading compensation consultancy firm, to study the present pay, allowances and benefits available to MD & CEO / WTDs of the Bank and recommend suitable compensation structure, keeping in view industry practices and compliance with the RBI guidelines. The recommendations of the consultants have been considered in drafting the revised Compensation Policy of the Bank, which is currently pending implementation in view of the awaited RBI approval.

A description of the scope of the Bankâs remuneration policy, including the extent to which it is applicable to foreign subsidiaries and branches:

The Committee monitors the remuneration policy for both domestic and overseas branches of the Bank on behalf of the Board. However, it does not oversee the compensation policy for subsidiaries of the Bank.

A description of the type of employees covered and number of such employees:

i Category 1

'' MD & CEO and WTDs:

This category includes MD & CEO and two Deputy Managing Directors (DMDs). The current remuneration structure for WTDs is at the same level, as that payable to WTDs of nationalized banks and the same is approved by Board and RBI.

2 / Category 2

Remuneration of Key Managerial Personnel:

The positions of Chief Financial Officer (CFO) and Company Secretary (CS) are held by cadre officers of IDBI Bank and their pay scales and remuneration structure is equivalent to the pay scales and remuneration structure being offered by IDBI Bank to the other parallel grade officers and is finalized by the Bank with the approval of the Board of Directors.

'' Category 3

fh / Other Officers and Employees:

The pay scales and remuneration structure of IDBI Bank''s Officers and Employees are finalized by the Bank after obtaining Board of Directors'' approval. As per the current policy, the pay scales and remuneration structure is a fixed structure, which is drawn out on the lines of the Indian Banks'' Association (IBA) pay scales and structure, and runs co-terminus with the industry level settlements for a period of 5 years.

(b) Information relating to the design and structure of remuneration processes and the key features and objectives of remuneration policy:

An overview of the key features and objectives of remuneration policy:

The current fixed pay of WTDs comprises of pay, allowances and perquisites and it is at the same level, as that payable to WTDs of nationalized banks. Approval of RBI has been obtained for the current fixed pay drawn by WTDs.

As per the directives of RBI, the revised compensation has been proposed for WTDs. The proposed compensation is a mix of fixed and variable pay. The variable pay based on the Bank''s performance is proposed for WTDs for FY 2020-21 and the same will be implemented after obtaining approval from RBI. For other employees, the current compensation structure is linked to IBA compensation structure.

of the Remuneration Policy

a) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Bank successfully;

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b) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

c) remuneration to Directors, Key Managerial Personnel (KMP) and Senior Management involves a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Bank and its goals:

(c) Description of the ways in which current and future risks are taken into account in the remuneration processes.

It includes the nature and type of the key measures used to take account of these risks.

On May 05, 2017, RBI had put IDBI Bank under PCA and imposed several restrictions including granting any performance linked incentives to the WTDs in view of Non-Performing Assets (NPAs) and losses incurred by the Bank. The Bank has been taken out of the restrictive Prompt Corrective Action (PCA) framework by RBI on March 10, 2021.

Pay and allowances for employees is presently based on structured pay scale in alignment with the structure prevailing in Public Sector Banks. There is no independent remuneration for risk and compliance employees. The Bank had given mandate to IBA for revision in the salary structure of officers in Grade A (Assistant Manager) to Grade C (Assistant General Manager). The Board of the Bank has approved the wage revision for all officers for the settlement period of 2017-22 based on the settlement arrived between Indian Banks'' Association on behalf of other Public Sector Banks & Private Sector Banks including IDBI Bank Ltd. and employee unions/associations on November 11,2020.

During the FY 2020-21, the new Compensation Policy for the Bank which provides for remuneration guidelines for all employees of the Bank was approved by the Board. However, the regulatory approval for implementation of new policy is awaited.

Severance Pay/ Guaranteed Pay

Severance pay other than superannuation benefits (Gratuity, Pension & PF) and leave encashment except in cases where it is mandatory under any statue will not be payable to any official of the Bank. Guaranteed bonus will not be awarded by the Bank other than for new hires as joining/sign-on bonus only in the first year. Any such guaranteed bonus, if required shall be in the form of share-linked instruments only (i.e. not in cash) and shall be excluded from RBI fixed pay and variable pay calculations.

Hedging

Employees shall be prohibited from insuring or hedging their compensation structure that may offset the downside risk embedded in their variable pay (e.g. no short selling or put derivatives allowed on the Bank''s stock after listing etc.) If this policy is breached, the Board may direct the concerned employee to cancel any outstanding insurance/hedging transaction and also impose an appropriate monetary or non-monetary penalty as per its direction

'' Malus/Clawback

Malus & Clawback provisions on variable pay (cash based & non-cash based) would enable to reduce or cancel unvested awards and recover previously paid compensation in certain situations viz. divergence in Bank''s provisioning for NPAs, subdued or negative financial performance, misconduct or any other parameter deemed relevant by the NRC. The clawback arrangements would imply recovery of annual cash incentives paid and LTI awards vested over the last five years from the date of discovery of the applicable trigger.

The performance linked variable pay proposed for FY 2020-21 shall be implemented for WTDs on receipt of regulatory approval from RBI.

(d) Description of the ways in which the Bank seeks to link performance during a performance measurement period with levels of remuneration:

Presently, the Bank follows a structured pay scale based compensation for its employees, in alignment with the pay and allowances structure followed in Public Sector Banks, as arrived by Indian Banks'' Association on behalf of the Banks through negotiated settlements with workmen unions / officers'' associations representing the employees of the member banks. As such, there is no concept of remuneration linked with performance presently in the Bank.

(e) A discussion of the Bankâs policy on deferral and vesting of variable remuneration and a discussion of the Bankâs policy and criteria for adjusting deferred remuneration before vesting and after vesting:

Presently, there is no variable remuneration in the compensation structure applicable to Bank''s employees. In compliance to RBI circular of November 04, 2019, the Bank has engaged services of compensation consultant to advise the Bank about compensation structure for MD & CEO/ WTDs/ Material Risk Takers and control staff. The Board at its meeting dated September 29, 2020 had approved the Compensation Policy for the Bank which provides for remuneration guidelines for all employees of the Bank. The Bank is awaiting approval of the Reserve Bank of India for implementation of the new Compensation Policy

(f) Description of the different forms of variable remuneration (i.e. cash, shares, ESOPs and other forms) that the Bank utilizes and the rationale for using these different forms:

Remuneration to employees of the Bank is presently in alignment with the structured pay scales as applicable in Public Sector Banks, which is done by way of industry level negotiated settlements through Indian Banks'' Association and representative unions/associations of member Banks. There are currently no other forms of variable remuneration in the Bank.

The Bank''s employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is managed by âThe Board of Trustees of IDBI Bank Employees'' Provident Fund Trust (Trust)â. In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year '' 5.55 Crores (Previous Year: '' 5.96 Crores) has been contributed to PFS and charged to Profit and Loss Account.

The Bank''s employees who have joined after April 1,2008 are covered by IDBI Bank Ltd. New Pension Scheme (IBLNPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, '' 100.24 Crores (Previous Year: '' 90.99 Crores) has been contributed to IBLNPS and charged to Profit and Loss Account.

The Government of India (GoI), Ministry of Finance, Department of Financial Services vide its letter dated 5th September 2016, advised the Bank to surrender securities of '' 1064.27 Crores to the GoI representing net impact of the asset exchange of Stressed Assets Stabilisation Fund (SASF) done by the Bank in 2006. Accordingly as on March 31,2021, total securities written off from SASF account stands at '' 1064.27 cr. Thus the full written off has been completed. However, these written off securities are not reflected in SGL account as on 31.03.2021 due to pending Government notification for redemption, which resulted in difference of the same amount in SGL account.

Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is '' 146.82 Crores (Previous Year: '' 120.98 Crores).

Pending industry wide bipartite settlement on wage revision (due with effect from November 2017), a sum of '' 294 Crores (Previous Year: '' 350 Crores) has been provided by the Bank during the year on this account on estimated basis. Cumulative provision held as on March 31,2021 was '' 773 Crores (Previous Year: '' 420 Crores).

Industrial Development Bank of India (eIDBI) was a Statutory Corporation constituted under a special Act of Parliament, i.e., the IDBI Act, 1964. It was converted into a Bank in the present name of IDBI Bank constituted as a Company under the Companies Act, 1956 in the year 2004.

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The amount of application money due for refund in respect of IPO in 1995 and unclaimed dividends declared by e-IDBI prior to becoming the Company were lying with IDBI Bank. As per the legal opinion obtained from the Secretarial Auditors, it was suggested to seek advice from MCA/ IEPF Authority in the matter. Accordingly, IDBI Bank had written to MCA/ IEPF Authority to seek advice in this regard.

In response, IEPF Authority, vide letter dated February 01,2021 directed IDBI Bank to transfer the unpaid dividends pertaining to elDBI to IEPF. Pursuant to aforesaid direction, IDBI Bank transferred the amount of '' 7.11 Crores for the financial years 1995-96 to 2002-03 to IEPF.

The Bank had been put under a Prompt Corrective Action Framework (PCAF) by RBI. Considering the improved performance parameters, the RBI has taken out the Bank from the PCAF with effect from March 10, 2021.

Figures of the previous year, are disclosed in brackets and are regrouped/ rearranged, so as to confirm with the presentation made for the current year.

Mar 31, 2019

# Government of India infused Rs. 7881 crore on March 28, 2018 through Recapitalization Bonds and the same has not been allotted and shown as ''Equity Share Application Money'' as at March 31, 2018. On the basis of RBI letter dated April 23, 2018, the Bank has considered such ''Equity Share Application Money'' as a part of Common Equity Tier 1 (CET1) Capital as at March 31, 2018.

** Includes Share Capital of Rs. 3555 crore (Rs. 778 crore ) and Share Premium of Rs. 18069 crore (Rs.4206 crore)

RBI vide circular no DBR.No.BP.BC.83/21.06.201/2015/16 dated 1st March,2016 has given discretion to banks to consider Revaluation reserve / DTA for purpose of computation of capital Adequacy as CET-1 capital ratio. The bank has exercised the option in the above computation.

I. RBI vide its circular dated April 2, 2018 and June 15, 2018 permitted banks an option to spread provisioning for Mark to Market (MTM) losses on investments in AFS and HFT categories for the quarters ended December 31, 2017, March 31, 2018 and June 30, 2018 equally over the four quarters commencing with the quarter in which losses were incurred. The Bank has availed the benefit of spreading of MTM losses and an amount of Rs. 383.63 crore was unamortised as on 31.03.2018. the said amount along with spreading benefits availed during FY 2018-19 has been amortised fully during the current year and there are no further unamortised MTM losses as on march 31, 2019. Investment Fluctuation Reserve (IFR) : In view of the losses for the current FY 2018-19, the bank has not created IFR.

a. During the year ended March 31, 2019, the value of sales and transfers of securities to/from HTM category (excluding onetime transfer to/from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year and sale to RBI under pre-announced Open Market Operation (OMO) auctions) has not exceeded 5% of the book value of the investments held in HTM category at the beginning of the year. The same is in regard to RBI extant guidelines for compliance with SLR requirements.

1. Disclosures on risk exposure in derivatives- Qualitative disclosures

(i) The Bank uses derivatives for Hedging its own balance sheet items as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

(ii)The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organization, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by a Chief General Manager designated also as Chief Risk Officer. The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

(iii) Risk exposures in derivatives transactions are measured/ assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

(iv) The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 âSignificant Accounting Policies of the Bankâ.

2. The Bank has Board approved limit for Net Overnight Open Position (NOOP) fixed at Rs. 400 crore w.e.f from November 01, 2017. During the year the open position was within the approved limit and the average utilization was Rs. 298.22 crore. The maximum utilization during the year was at Rs. 368.41 crore on December 10, 2018.

Credit Default Swaps

The Bank is using standard model for marking to market the CDS contracts as per FIMMDA published daily CDS curve and day count convention to value their CDS positions. FIMMDA is publishing the CDS curves for this purpose on daily basis.

3. As per RBI Circular RBI/2015-16/423 DBR.No.BPBC.102/21.04.048/2015-16 dated June 13, 2016 Bank has made the following disclosure in Notes to Accounts with regard to the quantum of provision made during the year to meet the shortfall in sale of NPAs to SCs/RCs and the quantum of unamortised provision debited to âother reservesâ as at the end of the year.

a) quantum of provision made during the year to meet the shortfall in sale of NPAs to SCs/RCs- Nil

b) quantum of unamortised provision debited to âother reservesâ as at the end of the year.- Nil

4. Prudential Exposure Limits

During the Year ended March 31, 2019, the Bank''s exposure to single borrowers and group borrowers were within the prudential exposure limits prescribed by RBI, where single borrower limit of 15% & 20% (for Infrastructure) of TCF was exceeded and Group borrower limit of 40% of TCF (Quarterly breach mentioned below). In respect of these cases, the sanctioned limits and outstanding as % of capital funds (including non-funded exposure) were as follows:

* In case of multiple breaches observed during the year, the maximum breach observed and corresponding outstanding percentage have been reported.

Note : During the year, the Bank has revised its Capital Fund calculation methodology & the regulatory capital calculated as per Basel III is now considered as Capital fund which includes deduction of losses on quarterly basis. Consequently the above breaches are observed due to change in capital position.

* Other Provision and Contingencies inter alia includes provision for Non Banking Assets acquired in satisfaction of claims of Rs. 713.60 crore (Rs.NIL), provision for uncollected/unrealised charges of Rs. 253.05 crore (Rs.121 crore), provision for revaluation loss on accumulated unremitted profit/loss of Overseas branches on account of accumulated net provisions of Rs. 294.15 crore (Rs.NIL).

Total amount of unsecured advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken is Rs.NIL (Rs.NIL) and the estimated value of intangible security as on March 31, 2019 is Rs.. Nil (Rs.NIL).

I. Unhedged Foreign Currency Exposure

The Bank obtains information on Un-hedged Foreign Currency Exposure from its customers on a periodic basis and maintains the same in an internally developed system and follows the methodology for computation of likely loss on account of exchange rate movement. The incremental provisioning for the year ending 31-03-2019 towards this exposure worked out to write back of Rs 19 crore (write back of Rs. 205.62 crore) and capital held towards the risk stood at Rs. 46.25 crore (Rs. 96.83 crore) as on 31-03-2019.

* The average weighted and un-weighted amounts are calculated taking daily simple average from 1st April, 2018 to 31st March, 2019 for working days.

Qualitative disclosure around Liquidity Coverage Ratio ( LCR ) :

In the backdrop of the global financial crisis that started in 2007 the Basel Committee on Banking Supervision (BCBS) proposed certain reforms to strengthen global capital and liquidity regulations with the objective of promoting a more resilient banking sector. In this direction BCBS published guidelines on âBasel III: The Liquidity Coverage Ratio and liquidity risk monitoring toolsâ in January 2013 and the âLiquidity Coverage Ratio Disclosure Standardsâ in January 2014. Accordingly, Reserve Bank of India, vide its circular dated June 09, 2014, issued guidelines on Liquidity Coverage Ratio (LCR).

5. The LCR promotes short-term resilience of banks to potential liquidity disruptions by ensuring that they have sufficient high quality liquid assets (HQLAs) to survive an acute stress scenario lasting for 30 days. The LCR standard aims to ensure that a bank maintains an adequate level of unencumbered HQLAs that can be converted into cash to meet its liquidity needs for a 30 calendar day time horizon under a significantly severe liquidity stress scenario specified by supervisors.

The LCR requirements are binding on banks from January 1, 2015. However, with a view to provide a transition time for banks, the requirement is minimum 60% for the calendar year 2015 i.e. with effect from January 1, 2015, and rise in equal steps of 10% over a period of 4 years to reach the minimum required level of 100% on January 1, 2019.

High Quality Liquid Assets

Under the standard, banks must hold a Stock of unencumbered HQLA to cover the total net cash outflows over a 30-day period under the prescribed stress scenario. In order to qualify as HQLA, assets should be liquid in markets during times of stress and, in most cases, be eligible for use in central bank operations. The HQLA of the Bank mainly comprise of SLR investments over and above mandatory requirement, liquidity available by way of borrowing under Marginal Standing Facility (2% of NDTL), Facility to Avail Liquidity for Liquidity Coverage Ratio (13% of NDTL) & other securities issued by PSEs or non-financial corporates.

6. Liquidity Management

The Bank has well organized liquidity risk management structure as enumerated in ALM Policy which is approved by the Board. The Asset Liability Management Committee ( ALCO ) of the Bank monitors & manages liquidity and interest rate risk in line with the business strategy. ALM activity including liquidity analysis & management is conducted through coordination between various ALCO support groups residing in the functional areas of Balance Sheet Management, Treasury Front Office, Budget and Planning etc. ALCO directives and ALM actions are implemented by the business groups and verticals. The average LCR of the Bank for FY2018-19 is at 114.37% (102.87%).

Qualitative disclosures

(a) Information relating to the composition and mandate of the Remuneration Committee.

- Name, composition and mandate of the main body overseeing remuneration:

- On February 25, 2019, the Nomination Committee and the Remuneration Committee was merged into a single committee known as Nomination and Remuneration Committee (NRC). The NRC comprises of five members with an Independent Director, as its chairman and Government Nominee Director, LIC Nominee Director and two other i Independent Directors as other members. The Committee fulfils the mandate/ terms of reference provided under | Section 178 of the Companies Act, 2013, Regulation 19 and Part D of Schedule II of the LODR Regulations and RBI | guidelines in respect of fit and proper status of Directors as under.

- Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board of Directors a policy relating to appointment and evaluation of Directors;

- To specify the manner for effective evaluation of performance of the Board, its Committees and individual directors, to be carried out either by the Board, by the NRC or by an independent external agency and review its implementation and compliance;

- Formulation of criteria for evaluation of performance of Independent Directors and the Board of Directors;

- Devising a policy on diversity of Board of Directors;

- To identify persons who are qualified for appointment as Independent Directors in accordance with Directorsâ Appointment and Evaluation Policy;

- To recommend to the Board the appointment and removal of Directors in accordance with the criteria laid down in the Directorsâ Appointment and Evaluation Policy;

- To undertake a process of due diligence to determine the suitability of any person for appointment / continuing to hold appointment as a director on the Board, based upon qualification, expertise, track record, integrity, âfit and properâ criteria, positive attributes and independence (if applicable) and on the basis of the report of performance evaluation of directors including independent directors and formulate the criteria relating thereto;

- Formulation of Remuneration Policy for Directors, KMPs, etc;

- Recommend to the Board, all remuneration, in whatever form, payable to the senior management;

- To work in co-ordination with Risk Management Committee in order to achieve effective alignment between remuneration and risks

As on March 31, 2019, the NRC comprised of five members with Shri Gyan Prakash Joshi, Independent Director, as i its chairman and Shri Pankaj Jain, Government Nominee Director, Shri Rajesh Kandwal, LIC Nominee Director, Shri i B. B. Joshi & Shri N. Jambunathan, Independent Directors as other members

External consultants whose advice has been sought, the body by which they were commissioned, and in what areas of the remuneration process

During the year 2018-19, no external consultants were appointed for seeking advise in any of the areas of remuneration process

A description of the scope of the Bankâs remuneration policy including the extent to which it is applicable to foreign subsidiaries and branches:

The Committee monitors the remuneration policy for both domestic and overseas branches of the Bank on behalf of i the Board. However, it does not oversee the compensation policy for subsidiaries of the Bank.

A description of the type of employees covered and number of such employees:

Category 1

MD & CEO and WTDs. This category includes 3 employees. Prior to the acquisition by LIC, being a Government owned public sector bank, the remuneration of Whole Time Directors was fixed by GoI as per the appointment orders of the respective Whole Time Directors, while the Non- Executive Directors were paid sitting fees as per the rates prescribed by GoI and followed by all Public Sector Banks. No other remuneraton are paid to non-Executive Directors. Post acquisition by LIC and re-categorization by RBI as a Private Sector Bank w.e.f January 21, 2019, the Whole Time Executive Directorsâ appointments and remuneration requires prior approval of RBI.

During the FY 2018-19, upon nomination by LIC and approval from RBI, Shri Rakesh Sharma MD & CEO was continued as MD & CEO by fresh appointment on the same remuneration as per the appointment order issued by GoI. As regards the appointments of other WTDs, Board had approved continuation of the service of Existing two WTDs(DMDs) till the appointment of new DMDs. Hence as on 31st March 2019, the existing incumbents continued to hold position of WTDs (DMDs) on their existing remuneration as per earlier appointment letter issued by GoI. Category 2

Remuneration of Key Managerial Personnel:

The positions of CFO and CS are held by cadre officers of IDBI Bank and their Pay Scales and Remuneration structure would be equivalent to the Pay Scales and Remuneration structure being offered by IDBI Bank to the other parallel grade officers and would be finalized by the Bank with the approval of the Board of Directors Category 3: other Officers and employees

The Pay Scales and Remuneration structure of IDBI Bank''s Officers and Employees are finalized by IDBI Bank after obtaining Board of Directors'' approval. As per the current policy, the pay scales and remuneration structure is a fixed structure, which is drawn out on the lines of IBA pay scales and structure, and runs co-terminus with the industry level settlements for a period of 5 years.

Count of Officers and employees is given below:

(b) Information relating to the design and structure of remuneration processes and the key features and objectives of remuneration policy

An overview of the key features and objectives of remuneration policy:

During the year 2018-19, LIC had on January 21, 2019 completed acquisition of 51% Controlling Stake in IDBI Bank and was reclassified as Promoter of the Bank on and from the aforesaid date.

Prior to the acquisition by LIC, being a Government owned public sector bank, the remuneration of Whole Time Directors was fixed by GoI as per the appointment orders of the respective Whole Time Directors, while the Non-Executive Directors were paid sitting fees as per the rates prescribed by GoI and followed by all Public Sector Banks. No other remuneration is paid to non-Executive Directors. Post acquisition by LIC and re-categorization by RBI as a Private Sector Bank w.e.f. January 21, 2019, the Whole Time Executive Directorsâ appointments and remuneration requires prior approval of RBI.

During the FY 2018-19, upon nomination by LIC and approval from RBI, Shri Rakesh Sharma MD & CEO was i continued as MD & CEO by fresh appointment on the same remuneration as per the appointment order issued by GoI. As regards the appointments of other WTDs, Board had approved continuation of the service of Existing two WTDs (DMDs) till the appointment of new DMDs. Hence as on 31st March 2019, the existing incumbents continued i to hold position of WTDs (DMDs) on their existing remuneration as per earlier appointment letter issued by GoI. Objective of the Remuneration Policy To ensure that:

a) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully;

b) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

c) remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the company and its goals:

(c) Description of the ways in which current and future risks are taken into account in the remuneration processes. It includes the nature and type of the key measures used to take account of these risks.

During the year 2018-19, LIC had on January 21, 2019 completed acquisition of 51% Controlling Stake in IDBI Bank and was reclassified as Promoter of the Bank on and from the aforesaid date.

Prior to the acquisition by LIC, being a Government owned public sector bank, the remuneration of Whole Time Directors was fixed by GoI as per the appointment orders of the respective Whole Time Directors, while the Non- Executive Directors were paid sitting fees as per the rates prescribed by GoI and followed by all Public Sector Banks. No other remuneration are paid to non-Executive Directors. Post acquisition by LIC and re-categorization by RBI as a Private Sector Bank w.e.f January 21, 2019, the Whole Time Executive Directorsâ appointments and remuneration requires prior approval of RBI.

During the FY 2018-19, upon nomination by LIC and approval from RBI, Shri Rakesh Sharma MD & CEO was continued as MD & CEO by fresh appointment on the same remuneration as per the appointment order issued by GoI. As regards the appointments of other WTDs, Board had approved continuation of the service of Existing two WTDs(DMDs) till the appointment of new DMDs. Hence as on 31st March 2019, the existing incumbents continued to I hold position of WTDs (DMDs) on their existing remuneration as per earlier appointment letter issued by GoI.

Whether the remuneration committee reviewed the firmâs remuneration policy during the past year, and if so, an overview of any changes that were made:

During the FY 2018-19 the bank has not reviewed its remuneration policy. However, consequent to Acquisition of 51% Controlling Stake by LIC in IDBI bank, the bank had revised its remuneration policy so as to cover the resultant changes due to acquisition by LIC, and also covering amendments to the Companies Act, 2013 and SEBI (LO DR) Regulations, 2015 which was approved by the NRC and Board in its meetings held on May 13, 2019.

A discussion of how the Bank ensures that risk and compliance employees are remunerated independently of the businesses they oversee:

On May - 2017, RBI had put IDBI Bank under PCA and imposed several restrictions including granting any performance linked incentives to the WTDs in view of NPAs and losses incurred by the Bank. The bank continues its efforts to come out of PCA by implementing the restrictions imposed by RBI. Presently, the remuneration being paid to all employees in different segments follows uniformity

(d) Description of the ways in which the bank seeks to link performance during a performance measurement period with levels of remuneration.

Presently Bank follows a structured pay scale based compensation for its employees, in alignment with the pay and allowances structure followed in Public Sector Banks, as arrived by Indian Banksâ Association on behalf of the Banks through negotiated settlements with workmen unions / officersâ associations representing the employees of the member Banks. As such there is no concept of remuneration linked with performance presently in the Bank.

(e) A discussion of the bankâs policy on deferral and vesting of variable remuneration and a discussion of the bankâs policy and criteria for adjusting deferred remuneration before vesting and after vesting.

Presently there is no variable remuneration in the compensation structure applicable to Bankâs employees.

(f) Description of the different forms of variable remuneration (i.e. cash, shares, ESOPs and other forms) that the bank utilizes and the rationale for using these different forms.

Remuneration to employees of the Bank is presently in alignment with the structured pay scales as applicable in Public Sector Banks, which is done by way of industry level negotiated settlements through Indian Banksâ Association and representative unions/associations of member banks. There are currently no other forms of variable remuneration in the Bank.

The bank has re-valued the Premises include Leasehold / Freehold Land & Residential/ Office building at the end of business hours, on 31st March 2019 based on valuations made by independent valuers. The final revaluation considered was Rs. 7,116.98 crore as on March 31, 2019. The net appreciation of Rs. 2,013.12 crore arising on revaluation, being the difference between the net book value of Rs. 5,103.86 crore and revalued amount of Rs. 7,116.98 crore was credited to Revaluation Reserve on March 31, 2019

ii. The balance in Revaluation Reserve as at March 31, 2019 is 6,727.69 crore (Rs. 5,053.88 crore for previous year).

iii. Net Loss amounting to Rs. 72.57 crore on account of sale of residential/office buildings and other assets during the year is included in Schedule 14 - Other Income.

iv. . Amount transferred from revaluation reserve to general reserve Rs. 339.31 crore (Rs. 363.87 cr) includes amount of depreciation on revalued portion Rs. 182.37 crore (Rs. 185.34 crore) and balance of revaluation reserve on sale of asset is Rs. 156.94 crore (Rs. 178.53 crore).

EMPLOYEE BENEFITS (AS-15) (REVISED)

2. A. Employee Benefit Schemes

Defined Contribution Schemes

The Bankâs employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is administered by âThe Committee of Administrators of IDBI Bank Employeesâ Provident Fund (Fund)â.â In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year, Rs. 13.52 crore (Rs. 4.52 crore) has been contributed to PFS and charged to Profit and Loss Account.

The Bankâs employees who have joined after April 1, 2008 are covered by Defined Contribution Pension Scheme (DCPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, Rs.153.16 crore (Rs. 69.20 crore) has been contributed to DCPS and charged to Profit and Loss Account.

ii. Defined Benefit Schemes

The Bank makes contributions for the gratuity liability of the employees to the âIDBI Bank Employees Gratuity Fund Trust.

a. Some of the employees of the Bank are also eligible for Pension which is administered by the âIDBI Pension Fund Trust.â

b. The present value of these defined benefit obligations and the related current service cost are measured using the Projected Unit Credit Method by an independent actuary at each balance sheet date.

The payment of Gratuity Act 1972 was amended on March 29, 2018 to increase the limit of Gratuity from Rs. 10 lakhs to Rs. 20 lakhs. The Reserve Bank of India vide its communication DBR No. BP.BC. 9730/ 21.04.018/ 2017-18 dated April 27, 2018, has given option to Banks to spread additional liability on account of enhancement in gratuity limits in four quarter beginning with the quarter ended March 31, 2018. Accordingly, the Bank had deferred the amount of Gratuity liability of Rs. 34.71 crore as on 31.03.2018 which was subsequently provided fully in the current year and there is no further unamortised gratuity liability as on 31.03.2019.

C Other long term benefits

Employees of the Bank are entitled to accumulate their earned/ privilege leave up to a maximum of 240 days for officers and 300 days for other staff. A maximum of 15 days leave is eligible for encashment in each year.

Some employees of the Bank are eligible for Voluntary Health Scheme which is borne by the Bank as and when the liability events occur.

Actuarial valuation of these benefits have been carried out using the Projected Unit Credit Method and Rs. 90.64 Crore has been charged to Profit and Loss Account during the year.

Employees of the Bank are eligible for Disability Assistance which is borne by the Bank as and when the disability events occur.

3. RELATED PARTY DISCLOSURES (AS-18)

A. List of related party as per AS-18

I. Holding Company

Life Insurance Corporation of India (LIC)

(Acquired 51% stake in paid up capital on January 21, 2019)

ii. Subsidiaries

IDBI Capital Market & Securities Limited.

IDBI Intech Ltd.

IDBI Mutual Fund Trustee Company Ltd.

IDBI Asset Management Ltd.

IDBI Trusteeship Services Limited

III. Jointly controlled entity

IDBI Federal Life Insurance Co. Ltd.

IV. Associates

Biotech Consortium India Ltd.

National Securities Depository Ltd

North Eastern Development Finance Corporation Ltd

Pondicherry Industrial Promotion Development and Investment Corporation Ltd (PIPDICL)

V. Key management personnel of the Bank

Shri Mahesh Kumar Jain, Managing Director & CEO (upto June 21, 2018).

Shri B. Sriram, Managing Director & CeO (from June 30, 2018 to September 30, 2018).

Shri Rakesh Sharma, Managing Director & CEO (from October 10, 2018).

Shri Krishna Prasad Nair, Deputy Managing Director.

Shri G.M.Yadwadkar, Deputy Managing Director.

Shri Ajay Sharma, Executive Director & Chief Financial Officer

Shri Pawan Agrawal, Company Secretary.

In terms of Section 2(51)(v) of the Companies Act, 2013, the Board had approved the proposal to designate officers one level below the Directors as KMPs on March 21, 2018. The Bank had filed the form with MCA for reporting/ registering the said officers as KMPs on April 19, 2018. Till now the said officers have not been registered as KMPs under the MCA site and hence cannot be technically deemed to be KMPs. However, as an abundant caution, Bank is disclosing information on remuneration of the said officers in the Annual Financial Statements under Related Party Transactions in accordance with the said board approval.

Shri P Sitaram, Executive Director

Shri G A Tadas, Executive Director

Dr. S S Banerjee, Executive Director

Smt. Mythili Balasubramanian, Executive Director (upto November 30, 2018)

Shri Abhay Laxman Bongirwar, Executive Director (upto September 29, 2018)

Shri Suresh Kishinchand Khatanhar, Executive Director

Shri Inderpal Singh Kalra, Executive Director

Shri Madhav Vasant Phadke, Executive Director

Shri Subroto Gupta, Executive Director

Shri Ajoy Nath Jha, CGM & CRO

Smt. Maya Chakravorty, CGM (upto May 14, 2018)

4. LEASES (AS-19)

Operating leases primarily comprise office premises, staff residences and Automated Teller Machines (ATM)s, which are either cancellable at the option of the Bank or non-cancellable operating lease.

During the year Rs. 303.42 Crore (Rs. 331.82 Crore) has been charged to the Profit and Loss Account towards lease charges paid/ payable on cancellable/non-cancellable operating lease.

5. AS-24 Discontinuing Operations

a. During the period from 01.04.2018 to 31.03.2019, the bank has not discontinued operations of any of its operations, which resulted in shedding of liability and realisation of the assets.

b. Long term contracts

c. Pending litigations

The Bankâs pending litigations comprise of claims against the Bank primarily by the borrowers, customers and proceedings pending with Income Tax authorities. The Bank has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed the contingent liabilities where applicable, in its financial statements.

*Refer Schedule-12- Contingent Liabilities for quantitative disclosure.

The Government of India (GoI), Ministry of Finance, Department of Financial Services vide its letter dated 5th September 2016, advised the Bank to surrender securities of Rs. 1064.27 crore to the GoI representing net impact of the asset exchange of Stressed Assets Stabilisation Fund (SASF) done by the Bank in 2006. These securities form part of Rs. 9000 crore of such securities issued to the Bank by GoI in September 2004 against SASF. These are 20 years securities maturing in September 2024. The Bank had obtained approval from the Appropriate Authorities to surrender these securities in 11 quarters commencing from quarter II of FY 2016-17. GoI vide its letter dated July 27, 2017 has agreed to the bankâs request. Bank is providing 96.75 crore per quarter since September 2016. Total securities written off from SASF account as on March 31, 2019 stands at Rs.1064.27 cr. Thus the full written off has been completed. However, these written off securities are reflected in SGL account as on 31.03.2019 pending Government notification for redemption which resulted in difference of the same amount in SGL account.

Pursuant to the provisions of Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro, small & medium enterprise. The Bank is in the process of compiling relevant information from its suppliers about their coverage under the said Act. In view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this Act is not expected to be material.

Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs. 118.39 crore (Rs. 138.68 crore).

Pending industry wide bipartite settlement on wage revision (due with effect from November 2017), a sum of Rs. 112 crore has been provided by the Bank during the year on this account on estimated basis. (Cumulative provision held as on March 31, 2019 was Rs. 174 crore)

Pursuant to appropriate operational procedures & legal opinion, the Bank has written back old unclaimed liabilities of Rs. 177.87 crores to other income pertaining to certain bonds issued prior to October 01, 2004 issued by erstwhile Industrial Development Bank of India (e-IDBI).

Other Liabilities include Rs. 7.22 crore as dividend payable pertaining to the years 1995 to 2003 in relation to the dividend declared by erstwhile Industrial Development Bank of India (e-IDBI). In compliance with the Legal Opinion obtained by the Bank, the Bank has taken all effective steps to reach out to the shareholders whose dividend remained unclaimed/ unpaid and has released payment based on valid requests received in this regard. Further, in compliance with the Legal Opinion, the Bank had also referred the matter to Ministry of Corporate Affairs (MCA) about the legality of transferring the amount to Investor Education and Protection Fund (IEPF) and has been regularly following up with the MCA and the IEPF Authority from whom, the response is awaited.

Figures of the previous year, are disclosed in brackets and are regrouped/ rearranged, so as to confirm with the presentation made for the current year.

Mar 31, 2018

EMPLOYEE BENEFITS (AS-15) (REVISED)

A. Employee Benefit Schemes

Defined Contribution Schemes

The Bankâs employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is administered by âThe Committee of Administrators of IDBI Bank Employeesâ Provident Fund (Fund)â.â In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year, Rs, 4.52 Crore (Rs, 4.68 Crore) has been contributed to PFS and charged to Profit and Loss Account.

The Bankâs employees who have joined after April 1, 2008 are covered by Defined Contribution Pension Scheme (DCPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, Rs,69.20 Crore (Rs, 63.95 Crore) has been contributed to DCPS and charged to Profit and Loss Account.

Defined Benefit Schemes

The Bank makes contributions for the gratuity liability of the employees to the âIDBI Bank Employees Gratuity Fund Trust.

a. Some of the employees of the Bank are also eligible for Pension which is administered by the âIDBI Pension Fund Trustâ

âPursuant to the Gazette Notification dated March 29, 2018 regarding amendment in Payment of Gratuity Act, 1972, Reserve Bank of India vide its communication DBR No. BP.BC. 9730/ 21.04.018/ 2017-18 dated April 27, 2018, has given option to Banks to spread additional liability on account of enhancement in gratuity limits from Rs, 10 lakhs to Rs, 20 lakhs in four quarter beginning with the quarter ended March 31, 2018. The Bank has exercised the option and has charged Rs, 11.57 Crore during the quarter ended March 31, 2018 and deferred Rs, 34.71 Crore to subsequent three quarter of the ensuing financial year.

C Other long term benefits

Employees of the Bank are entitled to accumulate their earned/ privilege leave up to a maximum of 180 days for officers and 300 days for other staff. A maximum of 15 days leave is eligible for encashment in each year.

Employees of the Bank are eligible for Disability Assistance which is borne by the Bank as and when the disability events occur

Some employees of the Bank are eligible for Voluntary Health Scheme which is borne by the Bank as and when the liability events occur.

Actuarial valuation of these benefits have been carried out using the Projected Unit Credit Method and Rs, 17.47 Crore (Rs, 73.07 Crore) has been charged to Profit and Loss Account during the year.

SEGMENT REPORTING (AS-17)

The Bank primarily operates in three business segments as under :

-o

Treasury operations include trading portfolio of investments, money market operations, derivative trading, foreign exchange operations on the proprietary account and for customers..

Retail Banking broadly includes credit and deposit activities that are primarily oriented towards individuals & small business including Priority sector lending. Retail Banking also encompasses payment and alternate channels like ATMs, POS machines, internet Banking, mobile Banking, credit cards, debit cards, travel/currency cards, third party distribution and transaction Banking services.

Includes corporate relationship covering deposit & credit activities other than retail. It also covers corporate advisory / syndication, project appraisal and investment portfolio including strategic investments other than those covered under Treasury.

A. List of related party as per AS-18

IDBI Capital Market Services Ltd.

IDBI Intech Ltd.

IDBI MF Trustee Company Ltd.

IDBI Asset Management Company Ltd.

IDBI Trusteeship Services Limited

Jointly controlled entity

IDBI Federal Life Insurance Co. Ltd.

Key management personnel of the Bank

Shri Kishor P Kharat, Managing Director & CEO (up to April 02, 2017)

Shri Mahesh Kumar Jain, Managing Director & CEO (from April 03, 2017)

Shri Krishna Prasad Nair, Deputy Managing Director.

Shri G.M.Yadwadkar, Deputy Managing Director.

Smt. Padma Betai, CFO (upto July 02, 2017)

Shri Ajay Sharma CFO (from July 03, 2017)

Shri Pawan Agrawal, Company Secretary.

Following have been considered as Key Management Personnel w.e.f March 21, 2018 as per the Board resolution

Shri. P Sitaram, Executive Director & Chief Compliance Officer

Smt. B Mythili, Executive Director

Shri. A L Bongirwar, Executive Director

Shri. G A Tadas, Executive Director

Dr. S S Banerjee, Executive Director & Chief Technology Officer

Shri. S K Khatanhar, Executive Director

Shri. I S Kalra, Executive Director

Shri. M V Phadke, Executive Director & Chief Audit Officer

Shri. Subroto Gupta, Executive Director

Shri. Ajoy Nath Jha, Chief Risk Officer

Smt. Maya Chakravorty, Chief General Manager, Treasury

B. Details of transactions with Related Parties

Parties with whom transaction were entered into during the year

No disclosure is required in respect of related parties, which are âState-controlled Enterprisesâ as per paragraph 9 of Accounting Standard (AS) 18. All the subsidiaries of the Bank are State-controlled Enterprises, hence no disclosure is made for transaction with subsidiary Companies. Further, in terms of paragraph 5 of AS 18, transactions in the nature of Banker-Customer relationship have not been disclosed in respect of Key Management Personnel and relatives of Key Management Personnel.

Operating leases primarily comprise office premises, staff residences and Automated Teller Machines(ATM)s, which are either cancellable at the option of the Bank or non-cancellable operating lease.

During the year Rs, 331.82 Crore (Rs, 310.50 Crore) has been charged to the Profit and Loss Account towards lease charges paid/ payable on cancellable/non-cancellable operating lease.

b. Long term contracts

c. Pending litigations

âRefer Schedule-12- Contingent Liabilities for quantitative disclosure.

B DISCLOSURES REQUIRED AS PER RBI GUIDELINES

# Government of India infused Rs, 7881 crore on March 28, 2018 through Recapitalization of Bonds and the same has not been allotted and shown as ''Equity Share Application Money'' as at March 31, 2018. On the basis of RBI letter dated April 23, 2018, the Bank has considered such ''Equity Share Application Money'' as a part of Common Equity Tier I (CET1) Capital as at March 31, 2018.

The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organization, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by a Chief General Manager designated also as Chief Risk Officer. The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

Risk exposures in derivatives transactions are measured/ assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 "Significant Accounting Policies of the Bank".

âSince the transaction are undertaken to hedge the interest rate and currency risks in the asset-liability portfolio, the bank is not calculating the maximum and minimum of 100âPV01 on daily basis.

The Bank has Board approved limit for Net Overnight Open Position (NOOP) fixed at Rs, 400 crore w.e.f from October 16, 2017 (earlier limit Rs, 300 crore). During the year the open position was within the approved limit and the average utilization was Rs, 237.51 crore. The maximum utilization during the year was at Rs, 313.86 crore on February 28, 2018.

Banks shall make appropriate disclosures in their financial statements, under âNotes on Accountsâ, relating to resolution plans implemented (ref: Para-16/ RBI Circular dtd february 12, 2018-RBI/2017-18/131/DBR.No.BP.BC.101/21.04.048/2017-18-âResolution of Stressed Assets -Revised Frameworkâ):

Rs, 75.16 crore @ 15% to be made on the outstanding funded liability of Rs, 501.09 crore (RTL & CC) as on March 31, 2018.

Rs, 145.50 crore on Bonds and Debentures & Rs, 290.06 crore on Pref Shares

a) quantum of provision made during the year to meet the shortfall in sale of NPAs to SCs/RCs- Nil

b) quantum of unamortised provision debited to âother reservesâ as at the end of the year.- Nil

@ Return on Assets is with reference to average working funds (i.e. total of assets excluding accumulated losses, if any).

# For the purpose of computation of business per employee (deposits plus advances) inter Bank deposits are excluded.

The provision towards depreciation ( mark to market ) on the investment under Available for Sale (AFS ) & Held for Trading ( HFT ) category where individual scrip value has not changed as per RBI guidelines has been regrouped from Schedule -14 âOther Incomeâ under the head âProfit & Loss on Revaluation of investment (net) to Provision & Contingencies under the head âProvision for Depreciation on Investments

Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken is Rs, Nil crore (Rs, 486.38 Crore) and the estimated value of intangible security as on March 31, 2018 is Rs,. Nil on pari-passu basis (Rs, Nil).

As a policy, the Bank does not make any floating provision for bad and doubtful advances and investments.

Note: Bank has not securitized-out any standard loans. However, bank has played the role of Investor by way of acquisition of Pass Through Certificate transaction, provider of credit enhancement as second loss facility and liquidity facility in securitization transaction of third party/ other Bank.

The LCR promotes short-term resilience of Banks to potential liquidity disruptions by ensuring that they have sufficient high quality liquid assets (HQLAs) to survive an acute stress scenario lasting for 30 days. The LCR standard aims to ensure that a Bank maintains an adequate level of unencumbered HQLAs that can be converted into cash to meet its liquidity needs for a 30 calendar day time horizon under a significantly severe liquidity stress scenario specified by supervisors.

The LCR requirement are binding on Banks from January 1, 2015. However, with a view to provide a transition time for Banks, the requirement is minimum 60% for the calendar year 2015 i.e. with effect from January 1, 2015, and rise in equal steps of 10% over a period of 4 years to reach the minimum required level of 100% on January 1, 2019

Under the standard, Banks must hold a stock of unencumbered HQLA to cover the total net cash outflows over a 30-day period under the prescribed stress scenario. In order to qualify as HQLA, assets should be liquid in markets during times of stress and, in most cases, be eligible for use in central Bank operations. The HQLA of the Bank mainly comprise of SLR investments over and above mandatory requirement, liquidity available by way of borrowing under Marginal Standing Facility (2% of NDTL), Facility to Avail Liquidity for Liquidity Coverage Ratio (9% of NDTL) & other securities issued by PSEs or non-financial corporates.

Total expected cash outflows are calculated by multiplying the outstanding balances of various categories or types of liabilities and off-balance sheet commitments by the rates at which they are expected to run off or be drawn down. Total expected cash inflows are calculated by multiplying the outstanding balances of various categories of contractual receivables by the rates at which they are expected to flow in.

The Bank has well organised liquidity risk management structure as enumerated in ALM Policy which is approved by the Board. The Asset Liability Management Committee (ALCO) of the Bank monitors & manages liquidity and interest rate risk in line with the business strategy. ALM activity including liquidity analysis & management is conducted through coordination between various ALCO support groups residing in the functional areas of Balance Sheet Management, Treasury Front Office, Budget and Planning etc. ALCO directives and ALM actions are implemented by the business groups and verticals.

As per the regulatory guidelines, presently Bank maintains LCR in domestic currency only. The average LCR of the Bank for the year 2017-18 was at 102.87% (114.17%).

The Government of India (GoI), Ministry of Finance, Department of Financial Services vide its letter dated 5^th September 2016, advised the Bank to surrender securities of Rs, 1064.27 crore to the GoI representing net impact of the asset exchange of Stressed Assets Stabilisation Fund (SASF) done by the Bank in 2006. These securities form part of Rs, 9000 crore of such securities issued to the Bank by GoI in September 2004 against SASF. These are 20 years securities maturing in September 2024. The Bank has obtained approval from the Appropriate Authorities to surrender these securities in 11 quarters commencing from quarter ended September 30, 2016 and accounted the same accordingly. Approval from appropriate authority has been obtained. Bank has so far surrendered securities of Rs, 677.25 crore to the GoI and the balance securities of Rs, 387.02 crore are carried forward as Investments. The Bank will surrender the balance of securities of Rs, 387.02 crore in the remaining four quarters.

Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs, 138.68 Crores (Rs, 205.94 Crores).

Other Liabilities include Rs, 7.05 crores as dividend payable pertaining to the years 1995 to 2003 in relation to the dividend declared by erstwhile Industrial Development Bank of India (IDBI). On the basis of the legal opinion on record the amount need not be transferred to Investors Education and Protection Fund (IEPF) as Companies Act 1956/Companies Act 2013 is not applicable to erstwhile IDBI. The Bank had referred the matter to Ministry of Corporate Affairs (MCA) about the legality of transferring the amount to Investor Education and Protection Fund (IEPF) where the reply is awaited.

Figures of previous year, are disclosed in brackets and are regrouped/ rearranged, so as to confirm with the presentation made for the current year.

To carry out any other role mandated to it by regulatory/ statutory requirements or the Government of India (GoI)/ Reserve Bank of India (RBI) directions notified from time to time.

Mar 31, 2017

1. FIXED ASSETS (PROPERTY, PLANT & EQUIPMENTS AS-10)

i. Premises include Leasehold Land (revalued) of Rs.2177.16 Crore (Rs.2177.16 Crore) which was revalued at the end of business hours, on 31^st March 2016. The net appreciation of Rs.1129.05 Crore arising on revaluation, was credited to Revaluation Reserve on March 31, 2016.

ii. The Bank has revalued its Freehold Land & Residential/ Office building at the end of business hours, on 31^st March 2016 based on valuations made by independent valuers. The net appreciation of Rs.2807.29 Crore arising on revaluation, being the difference between the net book value of Rs.1202.71 Crore and revalued amount of Rs.4010 Crore was credited to Revaluation Reserve on March 31, 2016.

iii. The balance in Revaluation Reserve as at March 31, 2017 is Rs.541775 Crore (Rs.560783 Crore).

2. EMPLOYEE BENEFITS (AS-15) (REVISED)

i. Defined Contribution Schemes

The Bankâs employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is administered by âThe Committee of Administrators of IDBI Bank Employeesâ Provident Fund (Fund)â.â In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year, Rs.4.68 Crore (Rs.4.85 Crore) has been contributed to PFS and charged to Profit and Loss Account.

The Bankâs employees who have joined after April 1, 2008 are covered by Defined Contribution Pension Scheme (DCPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, Rs.63.95 Crore (Rs.53.83 Crore) has been contributed to DCPS and charged to Profit and Loss Account.

ii. Defined Benefit Schemes

The Bank makes contributions for the gratuity liability of the employees to the âIDBI Bank Employees Gratuity Fund Trust.

a. Some of the employees of the Bank are also eligible for Pension which is administered by the âIDBI Pension Fund Trust.

The following table sets out the status of the defined benefit schemes and the amounts recognised in the Bankâs financial statements as at March 31, 2017 which is per AS-15(R).

iii. Other long term benefits

Employees of the Bank are eligible for Disability Assistance which is borne by the Bank as and when the disability events occur.

Some employees of the Bank are eligible for Voluntary Health Scheme which is borne by the Bank as and when the liability events occur.

Actuarial valuation of these benefits have been carried out using the Projected Unit Credit Method and Rs.73.07 Crore (Rs.20.29 Crore) has been charged to Profit and Loss Account during the year.

3. RELATED PARTY DISCLOSURES (AS-18)

A. List of related party as per AS-18

I. Subsidiaries

IDBI Capital Market Services Ltd.

IDBI Intech Ltd.

IDBI MF Trustee Company Ltd.

IDBI Asset Management Company Ltd.

IDBI Trusteeship Services Limited

II. Jointly controlled entity

IDBI Federal Life Insurance Co. Ltd.

III. Key management personnel of the Bank

Shri Kishor P Kharat, Managing Director & CEO

Shri Balkrishan Batra, Deputy Managing Director (April 01, 2016 to July 31, 2016)

Shri Krishna Prasad Nair, Deputy Managing Director (From September 15, 2016 to March 31, 2017)

Shri G.M.Yadwadkar, Deputy Managing Director (From September 15, 2016 to March 31, 2017)

Shri N.S.Venkatesh, Executive Director & CFO (From April 01, 2016 to June 30, 2016)

Shri R.K. Bansal, Executive Director & CFO (From July 01, 2016 to August 15, 2016)

Smt. Padma Betai, CFO (From August 16, 2016 to March 31, 2017)

Shri Pawan Agrawal, Company Secretary

B. Details of transactions with Related Parties

Parties with whom transaction were entered into during the year

4. LEASES (AS-19)

Operating leases primarily comprise office premises, staff residences and Automated Teller Machines(ATM)s, which are either cancellable at the option of the Bank or non-cancellable operating lease.

During the year Rs.310.50 Crore (Rs.291.04 Crore) has been charged to the Profit and Loss Account towards lease charges paid/payable on cancellable/non-cancellable operating lease.

5. ACCOUNTING FOR TAXES ON INCOME (AS-22)

The Component of Deferred Assets and Deferred Liability arising out of timing difference is as follows:

6. JOINT VENTURES (AS-27)

Investments include Rs.384 Crore (Rs.384 Crore) representing Bankâs interest in the following joint venture.

As required by AS-27, the aggregate amount of each of the assets, liabilities, income, expenses, contingent liabilities and commitments related to the Bankâs interests in jointly controlled entity are disclosed as under:

a. Long term contracts

b. Pending litigations

*Refer Schedule-12- Contingent Liabilities for quantitative disclosure.

I. Sales and transfers of securities to/from Held to Maturity (HTM) category

a. During the year ended March 31, 2017, the value of sales and transfers of securities to/from HTM category (excluding onetime transfer to/from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year and sale to RBI under pre-announced Open Market Operation auctions) have exceeded 5% of the book value of the investments held in HTM category at the beginning of the year. The same is in regard to RBI extant guidelines for compliance with SLR requirements. The details of guidelines are given below.

In terms of RBI circular DBOD.BP.BC.No.42/21.01.141/2014-15 dated 7^th October, 2014, the banks were advised to bring down the ceiling on SLR securities under the HTM category from 24 per cent of NDTL to 22 per cent by September 19, 2015 in a graduated manner. Further in terms of RBI Circular DBR.NO.BP.B.C.65/21.04.141/2015-16 dated December 10, 2015, the banks were advised to bring down the ceiling on SLR securities under the HTM category from 22 per cent of NDTL to 21.5 percent by January 9, 2016, 21.25% from April 2, 2016, 21% from July 9, 2016, 20.75% from October 1, 2016 and to 20.50 per cent by January 7, 2017 in a graduated manner.

Accordingly, during the current financial year the Bank has transferred SLR securities with book value of Rs.3339.96 crore from HTM category to HFT/AFS category as per the extant RBI guidelines to comply with the aforesaid requirements.

7. Disclosures on risk exposure in derivatives- Qualitative disclosures

⁽ⁱ⁾ The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

⁽ⁱⁱ⁾ The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organization, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by a Chief General Manager designated also as Chief Risk Officer. The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

⁽ⁱⁱⁱ⁾ Risk exposures in derivatives transactions are measured/ assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 âSignificant Accounting Policies of the Bankâ.

8. Disclosure of Investment in SRs -

The following disclosures pertaining to investments in security receipts by the Bank as per RBI Circular RBI/2016-17/56 DBR.No.BP.BC.9/21.04.048/2016-17 dated September 1, 2016 is shown below.

9. As per RBI Circular RBI/2015-16/423 DBR.No.BP.BC.102/21.04.048/2015-16 dated June 13, 2016 Bank has made the following disclosure in Notes to Accounts with regard to the quantum of provision made during the year to meet the shortfall in sale of NPAs to SCs/RCs and the quantum of unamortised provision debited to âother reservesâ as at the end of the year.

i) a) quantum of provision made during the year to meet the shortfall in sale of NPAs to SCs/RCs- Nil

b) quantum of unamortised provision debited to âother reservesâ as at the end of the year.- Nil

10. Divergence in Asset Classification and Provisioning for NPAs - (ref DBR.BP.BC. No.63/21.04.018/2016-17 dated April 18, 2017)

Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken is Rs.486.38 Crore (Rs.596.30 Crore) and the estimated value of intangible security as on March 31, 2017 is Rs.NIL on pari-passu basis (Rs.NIL).

I. Securitisation

a. During the year ended March 31, 2017, the Bank has not securitized any pools of retail loans.

The detail of securitisation activity of the Bank is given below :

b. There are no SPVs sponsored by the Bank for securitisation transactions.

II. Credit Default Swaps

III. The Bank, as detailed in its Credit Policy, monitors the Unhedged Foreign Currency Exposure of its borrower and pursues its clients to hedge their forex exposure to minimize the losses due to adverse exchange rate fluctuation.

The Bank obtains information on Un-hedged Foreign Currency Exposure from its customers on a periodic basis and maintains the same in an internally developed system and follows the methodology for computation of likely loss on account of exchange rate movement. The incremental provisioning for the year ending 31-03-2017 towards this exposure worked out to Rs.100.62crore (Rs.47.62crore) and capital held towards the risk stood at Rs.588.99crore (Rs.415.76crore) as on 31-03-2017.

Qualitative disclosure around Liquidity Coverage Ratio ( LCR ) :

In the backdrop of the global financial crisis that started in 2007, the Basel Committee on Banking Supervision (BCBS) proposed certain reforms to strengthen global capital and liquidity regulations with the objective of promoting a more resilient Banking sector. In this direction BCBS published guidelines on âBasel III: The Liquidity Coverage Ratio and liquidity risk monitoring toolsâ in January 2013 and the âLiquidity Coverage Ratio Disclosure Standardsâ in January 2014. Accordingly, Reserve Bank of India, vide its circular dated June 09, 2014, issued guidelines on Liquidity Coverage Ratio (LCR).

Definition of LCR :

Stock of high quality liquid assets (HQLAs)

Total net cash outflows over the next 30 calendar days

High Quality Liquid Assets

Under the standard, Banks must hold a stock of unencumbered HQLA to cover the total net cash outflows over a 30-day period under the prescribed stress scenario. In order to qualify as HQLA, assets should be liquid in markets during times of stress and, in most cases, be eligible for use in central Bank operations. The HQLA of the Bank mainly comprise of SLR investments over and above mandatory requirement, liquidity available by way of borrowing under Marginal Standing Facility (2% of NDTL), Facility to Avail Liquidity for Liquidity Coverage Ratio (8% of NDTL) & other securities issued by PSEs or non-financial corporates.

Total net cash outflows :

Total expected cash outflows are calculated by multiplying the outstanding balances of various categories or types of liabilities and off-balance sheet commitments by the rates at which they are expected to run off or be drawn down. Total expected cash inflows are calculated by multiplying the outstanding balances of various categories of contractual receivables by the rates at which they are expected to flow in.

Liquidity Management:

As per the regulatory guidelines, presently Bank maintains LCR in domestic currency only. The average LCR of the Bank for the year 2016-17 was at 114.17% ( 88.59%)

A.OTHER DISCLOSURES

1. EMPLOYEESâ STOCK OPTION SCHEME (ESOP)

i. In terms of the ESOP, as amended, pursuant to the approval of the shareholders, 1,31,98,965 options (1,31,98,965 options) granted to eligible employees as detailed herein below:

ii. Nil (1095) equity shares allotted during the year against ESOPs exercised by the employees

2. Others

I. The Government of India (GoI), Ministry of Finance, Department of Financial Services vide its letter dated 5^th September 2016, advised the Bank to surrender securities of Rs.106427 lakhs to the GoI representing net impact of the asset exchange of Stressed Assets Stabilisation Fund (SASF) done by the Bank in 2006. These securities form part of Rs.900000 lakhs of such securities issued to the Bank by GoI in September 2004 against SASF. These are 20 years securities maturing in September 2024. The Bank has sought dispensation from the Appropriate Authorities to surrender these securities in 11 quarters commencing from quarter ended September 30, 2016 and accounted the same accordingly. Pending approval, the Bank has so far surrendered securities of Rs.29025 lakhs to the GoI and the balance securities of Rs.77402 lakhs are carried forward as Investments. The Bank is confident that it will get the approval to surrender the balance of securities of Rs.77402 lakhs in the remaining eight quarters

II. Notes to Corporate Social Responsibility (CSR) expenditure:

a. Gross amount required to be spent by the Bank during the year; Rs.NIL

b. Amount spent during the year:

III. Pursuant to the provisions of Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro, small & medium enterprise. The Bank is in the process of compiling relevant information from its suppliers about their coverage under the said Act. In view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this Act is not expected to be material.

IV. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs.205.94 Crores (Rs.288.84 Crores).

V. Pursuant to RBI Circular DBR.BP.BC.No.31/21.04.018/2015-16 dated July 16, 2015, the Bank has, effective from quarter ended June 30, 2015, included its deposits placed with NABARD, SIDBI and NHB on account of shortfall in lending to priority sector under âOther Assets. Hitherto these were included under âInvestments. Interest income on these deposits has been included under âInterest Earned-Others. Hitherto such interest income was included under âInterest earned-Income on Investments. Figures for the previous periods have been regrouped / reclassified to conform to current periodâs classification. The above change in classification has no impact on the profit/ loss of the Bank for the year ended March 31, 2017 or the previous year presented.

VI. In term of RBI circular no. FMRD.DIRD.10/14.03.002/2015-16 dated May 19, 2016, repo and reverse repo transactions with RBI under LAF/ MSF are accounted for as borrowing and lending respectively as against the earlier practice of including the same under Investments. Previous period figures have been regrouped and reclassified to conform to current periodâs classification. The aforesaid change has no impact on the loss of the Bank for the year ended March 31, 2017 or the previous year.

VII. The Bank believes that the MCA notification G.S.R. 308(E) dated March 30, 2017 regarding holdings as well as dealings in Specified Bank Notes during the period from 8^th November, 2016 to 30^th December, 2016 is not applicable to banking companies. Accordingly, the disclosures prescribed under the said notification are not required to be made by the Bank.

VIII. Figures of the previous year, are disclosed in brackets and are regrouped/ rearranged, so as to confirm with the presentation made for the current year.

Mar 31, 2015

A DISCLOSURE REQUIREMENTS AS PER ACCOUNTING STANDARDS

1. FIXED ASSETS (AS-10)

i. Premises include Leasehold Land (revalued) of Rs. 1339 70 11 thousand (Rs. 1339 70 11 thousand) which was revalued in the year 2006-07.

ii. The Bank has revalued its Freehold Land & Residential/ Office building based on valuations made by independent valuers during the year 2006-07. The net appreciation of Rs. 2063 91 00 thousand arising on revaluation, being the difference between the Net Book Value of Rs. 529 02 00 thousand and revalued amount of Rs. 2592 93 00 thousand as on March 31,2007, was credited to Revaluation Reserve. The balance in revaluation reserve as at March 31, 2015 after adjusting depreciation on same is Rs. 1662 85 04 thousand (Rs. 1712 83 66 thousand).

2. EMPLOYEE BENEFITS (AS-15) (REVISED)

i. Defined Contribution Schemes

The Bank''s employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is administered by "The Committee of Administrators of IDBI Bank Employees'' Provident Fund (Fund)". In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year, Rs. 4 99 43 thousand (Rs. 5 03 22 thousand) has been contributed to PFS and charged to Profit and Loss Account.

The Bank''s employees who have joined after April 1,2008 are covered by Defined Contribution Pension Scheme (DCPS) to which the Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, Rs. 44 23 39 thousand (Rs. 35 05 85 thousand) has been contributed to DCPS and charged to Profit and Loss Account.

ii. Defined Benefit Schemes

The Bank makes contributions for the gratuity liability of the employees to the ''IDBI Bank Employees Gratuity Fund Trust''.

a. Some of the employees of the Bank are also eligible for pension which is administered by the ''IDBI Pension Fund Trust''.

b. The present value of these defined benefit obligations and the related current service cost are measured using the Projected Unit Credit Method by an independent actuary at each balance sheet date.

The following table sets out the status of the defined benefit schemes and the amounts recognised in the Bank''s financial statements as per Accounting Standard 15(R).

iii. Other long term benefits

Employees of the Bank are entitled to accumulate their earned/ privilege leave up to a maximum of 180 days for officers and 300 days for other staff. A maximum of 15 days leave is eligible for encashment in each year.

Employees of the Bank are eligible for Disability Assistance which is borne by the Bank as and when the disability events occur.

Some employees of the Bank are eligible for Voluntary Health Scheme which is borne by the Bank as and when the liability events occur.

Actuarial valuation of these benefits have been carried out using the Projected Unit Credit Method and Rs. 98 71 87 thousand (Rs. 8 76 81 thousand) has been charged to Profit and Loss Account during the year.

3. KHII''I (W-17) / SEGMENT REPORTING (AS-17)

The Bank primarily operates in three business segments as under:

Treasury

Treasury operations include trading portfolio of investments, money market operations, derivative trading, foreign exchange operations on the proprietary account and for customers.

Retail Banking

Retail Banking broadly includes credit and deposit activities that are primarily oriented towards individuals & small business including Priority Sector Lending. Retail Banking also encompasses payment and alternate channels like ATMs, POS machines, internet banking, mobile banking, credit cards, debit cards, travel/ currency cards, third party distribution and transaction banking services._

Corporate / Wholesale Banking

Includes corporate relationship covering deposit and credit activities other than retail. It also covers corporate advisory / syndication, project appraisal and investment portfolio including strategic investments other than those covered under Treasury.

The Bank primarily operates in India, hence, the Bank has considered that its operations are predominantly in the domestic segment and as such there are no reportable geographical segments.

Related Party Disclosures (AS-18)

A. List of related party as per AS-18

i. Subsidiaries

IDBI Capital Market Services Ltd.

IDBI Intech Ltd.

IDBI MF Trustee Company Ltd.

IDBI Asset Management Company Ltd.

IDBI Trusteeship Services Limited.

ii. Jointly controlled entity

IDBI Federal Life Insurance Co Ltd.

iii. Key management personnel of the Bank

Shri M.S. Raghavan, Chairman & Managing Director

Shri Balkrishan Batra, Deputy Managing Director

Shri Melwyn Rego, Deputy Managing Director

B. i. Parties with whom transaction were entered into during the year

No disclosure is required in respect of related parties, which are "State-controlled Enterprises" as per paragraph 9 of Accounting Standard 18. All the subsidiaries of the Bank are State-controlled Enterprises, hence no disclosure is made for transaction with subsidiary Companies. Further, in terms of paragraph 5 of Accounting Standard 18, transactions in the nature of banker-customer relationship have not been disclosed in respect of relatives of Key Management Personnel.

Operating leases primarily comprise office premises, staff residences and Automated Teller Machines (ATM)s, which are either cancellable at the option of the Bank or non-cancellable operating lease.

During the year Rs. 256 35 54 thousand (Rs. 213 43 28 thousand) has been charged to the Profit and Loss Account towards lease charges paid/ payable on cancellable/ non-cancellable operating lease.

Investments include Rs. 384 crore (Rs. 384 crore) representing the Bank''s interest in the following Joint Venture.

As required by Accounting Standard 27, the aggregate amount of each of the assets, liabilities, income, expenses, contingent liabilities and commitments related to the Bank''s interests in jointly controlled entity are disclosed as under:

Claims against the Bank not acknowledged as debts

This item represents certain demands made in legal matters against the Bank in the normal course of business and customer claims arising in operational issues and fraud cases. The Bank does not expect the outcome of these proceedings to have a material adverse effect on the Bank''s financial conditions, results of operations or cash flows.

II Liability on account of Outstanding forward exchange contracts

The Bank enters into foreign exchange contracts in its normal course of business to exchange currencies at a pre-fixed price at a future date. This item represents the notional principal amount of such contracts, which are derivative instruments. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower.

III Guarantees given on behalf of constituents in India and outside India

As a part of its banking activities, the Bank issues guarantees on behalf of its customers. Guarantees generally represent irrevocable assurances that the Bank will make payments in the event of customer failing to fulfill its financial or performance obligations.

IV Acceptances, endorsements and other obligations

This item represents the documentary credits issued by the Bank in favour of third parties on behalf of its customers, as part of its trade finance banking activities with a view to augment the customers'' credit standing. Through these instruments, the Bank undertakes to make payments for its customers'' obligations, either directly or in case the customer fails to fulfil their financial or performance obligations.

Liability in respect of interest rate and currency swaps and credit default swaps.

This item represents the notional principal amount of various derivative instruments which the Bank undertakes in its normal course of business. The Bank offers these products to its customers to enable them to transfer, modify or reduce their foreign exchange and interest rate risks. The Bank also undertakes these contracts to manage its own interest rate and foreign exchange positions. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower.

The Bank underwrites Credit Default Swap (CDS) transaction for managing credit risks associated with Indian Corporate Bonds._

VI Liability in respect of other derivative contracts.

This item represents the notional principal amount of various currency options which the Bank undertakes in its normal course of business. The Bank offers these products to its customers to enable them to reduce their foreign exchange risks. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, while the net market risk is lower.

VII Liability on account of disputed Income tax, interest tax, penalty and Interest demands

The Bank is a party to various taxation matters in respect of which appeals are pending. The Bank expects the outcome of the appeals to be favorable based on decisions on similar issues in the previous years by the appellate authorities, based on the facts of the case and the provisions of Income Tax Act, 1961.

Other items for which the Bank is contingently liable

This item represents the guarantees issued by the Bank in favour of statutory authorities and others on its own behalf as part of normal business activity.

b. Long term contracts

The Bank has a process whereby periodically all long term contracts including derivative contracts are assessed for material foreseeable losses. At the year end, the Bank has reviewed and ensured that adequate provision as required under any law / accounting standards for material foreseeable losses on such long term contracts including derivative contracts has been made in the books of account.

c. Pending litigations

The Bank''s pending litigations comprise of claims against the Bank primarily by the borrowers, customers and proceedings pending with Income Tax authorities. The Bank has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed the contingent liabilities where applicable, in its financial statements.

*Also refer Schedule-12 - Contingent Liabilities

Sales and transfers of securities to/ from Held to Maturity (HTM) category

a. During the year ended March 31, 2015, the value of sales and transfers of securities to/ from HTM category (excluding one time transfer of securities to/ from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year and sale to RBI under pre-announced Open Market Operation auctions) have exceeded 5% of the book value of the investments held in HTM category at the beginning of the year.

Total book value and market value of HTM portfolio as of March 31,2015 is Rs. 90,643.66 crore and Rs. 90,959.34 crore respectively.

b. In terms of RBI circular DBOD.BP.BC.No.42/21.04.141/2014-15 dated October 7, 2014, banks have been advised to bring down the ceiling on SLR securities under the HTM category from 24.0% of NDTL to 23.5% by January 10, 2015 and to 22.0% in graduated manner. Accordingly, the Bank has transferred SLR securities with book value of Rs. 2672.13 crore from HTM category to HFT category as per the extant RBI guidelines.

a. Concentration of credit risk (current exposure to the Bank) to top 5 corporate clients as at March 31,2015 is at 64.23% (57.25 %) of the total current exposure from corporate clients to the Bank.

Disclosures on risk exposure in derivatives- Qualitative disclosures

The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

(ii) The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organisation structure, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by a Chief General Manager. The Risk Management Department is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

(iii) Risk exposures in derivatives transactions are measured/ assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/ counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/ counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, PV01, gaps, Greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 "Significant Accounting Policies of the Bank".

Working funds are reckoned as average of total assets (excluding accumulated losses, if any) as reported to Reserve Bank of India in Form X under Section 27 of the Banking Regulation Act, 1949, during the 12 months of the financial year.

Return on Assets is with reference to average working funds (i.e. total of assets excluding accumulated losses, if any).

For the purpose of computation of business per employee (deposits plus advances) interbank deposits are excluded.

Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken as Rs. Nil (Rs. Nil) and the estimated value of intangible security as on March 31,2015 is Rs. Nil (Rs. Nil)

As a policy, the Bank does not make any floating provision for bad and doubtful advances and investments.

a. During the year ended March 31,2015, the Bank has not securitised any pools of retail loans.

The Bank has not issued any letter of comfort during the year Rs. Nil (Rs. NIL).

XVIII. Fees and Remuneration Received in respect of Bancassurance Business

Disclosure on Penalty

During the year following penalties were imposed by regulatory authorities.

XXVII Credit Default Swaps

The Bank is using standard model for marking to market the CDS contracts as per FIMMDA published daily CDS curve and day count convention to value their CDS positions. FIMMDA is publishing the CDS curves for this purpose on daily basis.

The Bank, as detailed in its Credit Policy, monitors the Unhedged Foreign Currency Exposure of its borrower and pursues its clients to hedge their forex exposure to minimize the losses due to adverse exchange rate fluctuation.

The Bank obtains the information based on an internally developed system on Unhedged Foreign Currency Exposure from its clients on a periodic basis and follows the methodology for computation of likely loss on account of exchange rate movement. The incremental provisioning for the year ending March 31,2015 towards this exposure amounts to Rs. 102.38 crore and capital held towards the risk is Rs. 308 crore as on March 31,2015.

As per RBI disclosure requirement, the LCR for the year 2014-15 is disclosed for the Q4 of 2014-15. The average values disclosed above are calculated as simple average of monthly observations during the quarter.

Qualitative disclosure around Liquidity Coverage Ratio ( LCR ) :

In the backdrop of the global financial crisis that started in 2007, the Basel Committee on Banking Supervision (BCBS) proposed certain reforms to strengthen global capital and liquidity regulations with the objective of promoting a more resilient banking sector. In this direction BCBS published guidelines on ''Basel III: The Liquidity Coverage Ratio and liquidity risk monitoring tools'' in January 2013 and the ''Liquidity Coverage Ratio Disclosure Standards'' in January 2014. Accordingly, Reserve Bank of India, vide its circular dated June 09, 2014, issued guidelines on Liquidity Coverage Ratio (LCR).

The LCR promotes short-term resilience of banks to potential liquidity disruptions by ensuring that they have sufficient high quality liquid assets (HQLAs) to survive an acute stress scenario lasting for 30 days. The LCR standard aims to ensure that a bank maintains an adequate level of unencumbered HQLAs that can be converted into cash to meet its liquidity needs for a 30 calendar day time horizon under a significantly severe liquidity stress scenario specified by supervisors.

Definition of LCR :

The LCR requirement are binding on banks from January 1,2015. However, with a view to provide a transition time for banks, the requirement is minimum 60% for the calendar year 2015 i.e. with effect from January 1,2015, and rise in equal steps of 10% over a period of 4 years to reach the minimum required level of 100% on January 1,2019.

High Quality Liquid Assets

Under the standard, banks must hold a stock of unencumbered HQLA to cover the total net cash out flows over a 30- day period under the prescribed stress scenario. In order to qualify as HQLA, assets should be liquid in markets during times of stress and, in most cases, be eligible for use in central bank operations. The HQLA of the Bank mainly comprise of SLR investments over and above mandatory requirement, liquidity available by way of borrowing under Marginal Standing Facility (2% of NDTL), Facility to Avail Liquidity for Liquidity Coverage Ratio (5% of NDTL) & other securities issued by PSEs or non-financial corporates.

Total net cash outflows :

Total expected cash outflows are calculated by multiplying the outstanding balances of various categories or types of liabilities and off-balance sheet commitments by the rates at which they are expected to run off or be drawn down. Total expected cash in flows are calculated by multiplying the outstanding balances of various categories of contractual receivables by the rates at which they are expected to flow in.

Liquidity Management:

The Bank has well organised liquidity risk management structure as enumerated in ALM Policy which is approved by the Board. The Asset Liability Management Committee (ALCO) of the Bank monitors & manages liquidity and interest rate risk in line with the business strategy. ALM activity including liquidity analysis & management is conducted through coordination between various ALCO support groups residing in the functional areas of Balance Sheet Management, Treasury Front Office, Budget and Planning etc. ALCO directives and ALM actions are implemented by the business groups and verticals.

As per the regulatory guidelines, at present, the Bank maintains LCR in domestic currency only. The average LCR of the Bank for the Q4 of 2014-15 was at 76.74%.

The Bank had created Staff Welfare Fund for the purpose of staff welfare activities expenses. Subsequently the staff welfare activities expenses are debited to Profit and Loss Account of the Bank. Hence, the Management has decided to transfer the Staff Welfare Fund of Rs. 29.01 crore to General Reserve.

iii. Notes to Corporate Social Responsibility (CSR) expenditure:

a. Gross amount required to be spent by the Bank during the year Rs. 26.29 crore

Pursuant to the provisions of Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro, Small & Medium enterprise. The Bank is in the process of compiling relevant information from its suppliers about their coverage under the said Act. In view of the Management, the impact of interest, if any, that may be payable in accordance with the provisions of this Act is not expected to be material.

vi. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs. 528 05 51 thousand (Rs. 338 35 35 thousand).

Figures of the previous year, are disclosed in brackets and are regrouped / rearranged, so as to confirm with the presentation made for the current year.

Mar 31, 2014

I. Contingent Assets are not recognized.

A DISCLOSURE REQUIREMENTS AS PER ACCOUNTING STANDARDS

1. FIXED ASSETS (AS-10)

i. Premises include Leasehold Land (revalued) of Rs. 1339 70 11 Thousand (Rs. 1339 70 11 Thousand) which was revalued in the year 2006-07.

ii. The Bank has revalued its Freehold Land & Residential/ Office building based on valuations made by independent values during the year 2006-07. The net appreciation of Rs. 2063 91 00 Thousand arising on revaluation, being the difference between the net book value of Rs. 529 02 00 Thousand and revalued amount of Rs. 2592 93 00 Thousand as on March 31, 2007, was credited to Revaluation Reserve. The balance in revaluation reserve as at March 31, 2014 after adjusting depreciation on same is Rs. 1712 83 66 Thousand (Rs. 1762 78 10 Thousand).

2. EMPLOYEE BENEFITS (AS-15) (REVISED)

i. The Bank''s employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is administered by "The Committee of Administrators of IDBI Bank Employees'' Provident Fund (Fund)". In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year, Rs. 5 03 22 Thousand (Rs. 6 36 88 Thousand) has been contributed to PFS and charged to Profit and Loss Account.

The Bank''s employees who have joined after April 1, 2008 are covered by Defined Contribution Pension Scheme (DCPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, Rs. 35 05 85 Thousand (Rs. 13 73 80 Thousand) has been contributed to DCPS and charged to Profit and Loss Account.

ii. Defined Benefit Schemes

a. The Bank makes contributions for the gratuity liability of the employees to the ''IDBI Bank Employees Gratuity Fund Trust''.

b. Some of the employees of the Bank are also eligible for Pension which is administered by the ''IDBI Pension Fund Trust''.

The present value of these defined benefit obligations and the related current service cost are measured using the Projected Unit Credit Method by an independent actuary

iii. Other long term benefits at each balance sheet date.

Employees of the Bank are entitled to accumulate their earned/ privilege leave up to a maximum of 180 days for officers and 300 days for other staff. A maximum of 15 days leave is eligible for encashment in each year.

Employees of the Bank are eligible for Disability Assistance which is borne by the Bank as and when the disability events occur.

Some employees of the Bank are eligible for Voluntary Health Scheme which is borne by the Bank as and when the liability events occur.

Actuarial valuation of these benefits have been carried out using the Projected Unit Credit Method and Rs. 8 76 81 Thousand (Rs. 56 88 75 Thousand) has been charged to Profit and Loss Account during the year.

3. Related Party Disclosures (AS-18)

i. IDBI Capital Market Services Ltd.

IDBI Intech Ltd.

IDBI MF Trustee Company Ltd.

IDBI Asset Management Company Ltd.

IDBI Trusteeship Services Limited.

ii. Jointly controlled entity

IDBI Federal Life Insurance Co Ltd.

iii. Key management personnel of the Bank

Shri R.M. Malla, Chairman & Managing Director (up to May 31, 2013)

Shri M.S. Raghavan, Chairman & Managing Director (w.e.f. July 05, 2013)

Shri Bal Krishan Batra, Deputy Managing Director

Shri Melwyn Rego, Deputy Managing Director (w.e.f. August 30, 2013)

iv. Parties with whom transaction were entered into during the year

No disclosure is required in respect of related parties, which are "State-controlled Enterprises" as per paragraph 9 of Accounting Standard (AS) 18. Further, in terms of paragraph 5 of AS 18, transactions in the nature of Banker-Customer relationship have not been disclosed in respect of relatives of Key Management Personnel.

4. LEASES( AS-19)

Operating leases primarily comprise office premises, staff residences and Automated Teller Machines (ATMs), which are either cancellable at the option of the Bank or non-cancellable operating lease.

During the year Rs. 213 43 28 Thousand (Rs. 187 41 29 Thousand) has been charged to the Profit and Loss Account towards lease charges paid/payable on cancellable/non-cancellable operating lease.

b. Deferred Tax Liability on Special Reserve created under section 36 (1) (viii) of the Income Tax Act, 1961

The Bank creates Special Reserve through appropriations of profits, in order to avail tax deductions as per section 36(1)(viii) of the Income Tax Act, 1961. The Reserve Bank of India, though its circular dated December 20, 2013, had advised banks to create deferred tax liability (DTL) on the amount outstanding in Special Reserve, as a matter of prudence. In accordance with these RBI guidelines, during the three months ended December 31, 2013, the bank created DTL of Rs. 279.96 crore on Special Reserve outstanding at March 31, 2013, by reducing the reserves. Had this amount been charged to the Profit & Loss Account in accordance with the generally accepted accounting principles in India, the amount of Profit for the year would have been lower by such amount.

5. Description of Contingent Liabilities

Contingent Liability

I. Claims against the Bank not acknowledged as debts

Brief description

This item represents certain demands made in legal matters against the Bank in the normal course of business and customer claims arising in operational issues and fraud cases. The Bank does not expect the outcome of these proceedings to have a material adverse effect on the Bank''s financial conditions, results of operations or cash flows.

II.Liability on account of Outstanding forward exchange contracts

The Bank enters into foreign exchange contracts in its normal course of business, to exchange currencies at a pre-fixed price at a future date. This item represents the notional principal amount of such contracts, which are derivative instruments. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower.

III. Guarantees given on behalf of constituents in India and outside India

As a part of its banking activities, the Bank issues guarantees on behalf of its customers. Guarantees generally represent irrevocable assurances that the Bank will make payments in the event of customer failing to fulfill its financial or performance obligations.

IV. Acceptances, endorsements and other obligations

This item represents the documentary credits issued by the Bank in favor of third parties on behalf of its customers, as part of its trade finance banking activities with a view to augment the customers'' credit standing. Through these instruments, the Bank undertakes to make payments for its customers'' obligations, either directly or in case the customer fails to fulfill their financial or performance obligations.

V. Liability in respect of interest rate and currency swaps and credit default swaps

This item represents the notional principal amount of various derivative instruments which the Bank undertakes in its normal course of business. The Bank offers these products to its customers to enable them to transfer, modify or reduce their foreign exchange and interest rate risks. The Bank also undertakes these contracts to manage its own interest rate and foreign exchange positions. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, and hence a large value of gross notional principal of the portfolio, while the net market risk is lower.

The bank underwrites Credit default Swap (CDS) transaction for managing credit risks associated with Indian Corporate Bonds.

VI. Liability in respect of other derivative contracts

This item represents the notional principal amount of various currency options which the Bank undertakes in its normal course of business. The Bank offers these products to its customers to enable them to reduce their foreign exchange risks. With respect to the transactions entered into with its customers, the Bank generally enters into off-setting transactions in the inter-bank market. This results in generation of a higher number of outstanding transactions, while the net market risk is lower.

VII. Liability on account of disputed Income tax, interest tax, penalty and Interest demands

The Bank is a party to various taxation matters in respect of which appeals are pending. The Bank expects the outcome of the appeals to be favorable based on decisions on similar issues in the previous years by the appellate authorities, based on the facts of the case and the provisions of Income Tax Act, 1961.

VIII. Others items for which the bank is contingently liable

This item represents the guarantees issued by the Bank in favor of statutory authorities and others on its own behalf, as part of normal business activity.

* Also refer Schedule-12- Contingent Liabilities

V. Sales and transfers of securities to/from Held to Maturity (HTM) category

a. During the year ended March 31, 2014, the value of sales and transfers of securities to/from HTM category (excluding one time transfer of securities to/from HTM category with the approval of Board of Directors permitted to be undertaken by banks at the beginning of the accounting year and sale to RBI under preannounced Open Market Operation auctions) have not exceeded 5% of the book value of the investments held in HTM category at the beginning of the year.

b. In terms of RBI circular DBOD.BP.BC. No. 41/21.04.141/2013-14 dated August 23, 2013, as a one-time measure, RBI permitted the Banks to transfer SLR securities from AFS/HFT category to HTM category. Accordingly, the Bank has transferred SLR securities with face value of Rs. 849.31 crore from AFS category to HTM category and has recognised a resulting loss from the said transfer of Rs. 16.84 crore in the Profit and Loss Account for the year.

6. Disclosures on risk exposure in derivatives- Qualitative disclosures

(i) The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

(ii) The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organization structure, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by a Chief General Manager. The Risk Management Department is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

(iii) Risk exposures in derivatives transactions are measured / assessed, in both quantitative and qualitative terms, to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, PV01, gaps, Greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

(iv) The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.17 "Significant Accounting Policies of the Bank".

XIII. Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken is Rs. Nil and the estimated value of intangible security as on March 31, 2014 is Rs. Nil

XV. In terms of RBI circular DBOD.No.BP.BC.77/21.04.018/2013-14 dated December 20, 2013, during the year, the Bank has created a Deferred Tax Liability (DTL) of Rs. 279.96 Crores on Special Reserve under Section 36(1)(viii) of Income Tax Act, 1961, claimed and allowed till March 2013, by reducing the Reserves (previous year Rs. Nil).

XX. During the year a penalty of Rs. one crore has been imposed by Reserve Bank of India for certain deficiencies observed in compliance to the RBI instructions on KYC/AML (Previous year Rs. Nil) and a penalty Rs. two lakh by Securities Exchange Board of India for violation of Takeover Regulations and PIT Regulations (Previous year Rs. Nil). Both the penalties have been paid to the respective authorities.

XXVIII. The Bank is using standard model for marking to market the CDS contracts as per FIMMDA published daily CDS curve and day count convention to value their CDS positions. FIMMDA is publishing the CDS curves for this purpose on daily basis.

7. Others

(a) During the year, 27 11 66 013 (5 43 21 230) Equity Shares (Face Value Rs. 10 per share) were allotted to Government of India on preferential basis on December 30, 2013 at a premium of Rs. 56.38 (Rs. 92.71) per share, aggregating an amount of Rs. 1800 Crore (Rs. 555 Crore).

(b) 24 900 (45 455) equity shares allotted during the year against ESOPs exercised by the employees.

iii. Based on the information to the extent received from ''enterprises'' regarding their status under the ''Micro, Small & Medium Enterprises Development Act, 2006'' there is no micro, small & medium enterprise to which the bank owes dues, which are outstanding for more than 45 days as at March 31, 2014 and hence no disclosure relating to amounts unpaid as at the year ended together with interest paid/payable

iv. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs. 338 35 35 Thousand (Rs. 155 38 59 Thousand).

v. Figures of the previous year, are disclosed in brackets and are regrouped / rearranged, so as to confirm with the presentation made for the current year.

Mar 31, 2013

1 FIXED ASSETS (AS-10)

i. Premises include Leasehold Land (revalued) of Rs. 1339 70 11 Thousand (Rs. 1339 70 11 Thousand) which was revalued in the year 2006-07.

ii. The Bank has revalued its Freehold Land & Residential/ Office building based on valuations made by independent valuers during the year 2006-07. The net appreciation of Rs. 2063 91 00 Thousand arising on revaluation, being the difference between the net book value of Rs. 529 02 00 Thousand and revalued amount of Rs. 2592 93 00 Thousand as on March 31, 2007, was credited to Revaluation Reserve. The balance in revaluation reserve after adjusting depreciation on same is Rs. 1762 78 10 Thousand (Rs.1853 92 65 Thousand).

2 EMPLOYEE BENEFITS (AS-15) (REVISED)

i. Defined Contribution Schemes

The Bank''s employees, excluding those who have opted for pension, who have joined Bank before March 31, 2008 are covered by Provident Fund Scheme (PFS). The Bank makes a defined contribution measured as a fixed percentage of basic salary to the PFS. The Provident Fund Scheme is administered by "The Committee of Administrators of IDBI Bank Employees'' Provident Fund (Fund)". In respect of employees of IDBI Home Finance Limited (IHFL) and IDBI Gilts Limited (IGL), provident fund contributions were made to Regional Provident Fund Commissioner up to May 2011 and thereafter contributions have been made to the aforementioned Fund. During the year, Rs. 6 36 88 Thousand (Rs. 4 54 73 Thousand) has been contributed to PFS and charged to Profit and Loss Account.

The Bank''s employees who have joined after April 1, 2008 are covered by Defined Contribution Pension Scheme (DCPS) to which Bank makes a defined contribution as a fixed percentage of Pay and Dearness Allowance. During the year, Rs. 13 73 80 Thousand (Rs. 32 04 76 Thousand) has been contributed to DCPS and charged to Profit and Loss Account.

ii. Defined Benefit Schemes

a. The Bank makes contributions for the gratuity liability of the employees to the ''IDBI Bank Employees Gratuity Fund Trust''.

b. Some of the employees of the Bank are also eligible for Pension which is administered by the ''IDBI Pension Fund Trust''.

The present value of these defined benefit obligations and the related current service cost are measured using the Projected Unit Credit Method by an independent actuary at each balance sheet date.

3 SEGMENT REPORTING (AS-17)

The Bank has disclosed business segment as the primary segment, The Bank primarily operates in India, hence the Bank has considered that its operations are predominantly in the domestic segment and as such there are no reportable geographical segments,

4. RELATED PARTY DISCLOSURES (AS-18)

i. Subsidiaries

IDBI Capital Market Services Ltd.

IDBI Intech Ltd.

IDBI MF Trustee Company Ltd.

IDBI Asset Management Company Ltd.

IDBI Trusteeship Services Limited.

ii. Jointly controlled entity

IDBI Federal Life Insurance Co Ltd.

iii. Key management personnel of the Bank

Shri R.M Malla, Chairman & Managing Director

Shri Bal Krishan Batra, Deputy Managing Director

iv. Parties with whom transaction were entered into during the year

No disclosure is required in respect of related parties, which are "State-controlled Enterprises" as per paragraph 9 of Accounting Standard (AS) 18. Further, in terms of paragraph 5 of AS 18, transactions in the nature of Banker-Customer relationship have not been disclosed including those with Key Management Personnel and relatives of Key Management Personnel.

5. LEASES( AS-19)

Operating leases primarily comprise office premises, staff residences and ATMs, which are cancellable at the option of the Bank. During the year Rs. 187 41 29 Thousand (Rs. 157 59 29 Thousand) has been charged to the Profit and Loss Account towards lease charges paid/payable on cancellable operating lease.

I Prudential Exposure limits

During the year ended March 31, 2013, the Bank''s exposure to single borrowers and group borrowers were within the prudential exposure limits prescribed by RBI, except in one case where single borrower limit of 15% was exceeded with the approval of the Board of Directors, In respect of this case, the sanctioned limit and outstanding as % of capital funds (including non-funded exposure) were as follows, as on March 31,2013 :

II unsecured Advances

Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc, has been taken is Rs. Nil and the estimated value of intangible security as on March 31, 2013 is Rs. Nil on Pari - passu basis ,

III Draw Down from Reserves

During the financial year 2012-13, there has been no draw down from Reserves (previous year Nil).

IV The bank has not issued any letter of comfort during the year (Previous year NIL).

V During the year the Reserve Bank of India has not imposed any penalty on the Bank (Previous year Nil).

VI Credit Default Swaps

The Bank is using standard model for marking to market the CDS contracts as per FIMMDA published daily CDS curve and day count convention to value their CDS positions, FIMMDA is publishing the CDS curves for this purpose on daily basis,

VII. Based on the information to the extent received from ''enterprises'' regarding their status under the ''Micro, Small & Medium Enterprises Development Act, 2006'' there is no micro, small & medium enterprise to which the bank owes dues, which are outstanding for more than 45 days as at March 31, 2013 and hence no disclosure relating to amounts unpaid as at the year ended together with interest paid/payable as required under the said act is given (previous year Nil).

VIII. Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs. 155 38 59 Thousand (Rs. 180 43 38 Thousand).

IX. Figures of the previous year, are disclosed in brackets and are regrouped / rearranged, so as to confirm with the presentation made for the current year.

Mar 31, 2012

1. SEGMENT REPORTING (AS-17)

The Bank operates in three segments wholesale banking, retail banking and treasury services. These segments have been identified in line with AS-17 on segment reporting after considering the nature and risk profile of the products and services, the target customer profile, the organization structure and the internal reporting system of the Bank. The Bank has disclosed business segment as the primary segment. The Bank primarily operates in India, hence the Bank has been considered to operate predominantly in the domestic segment and as such there are no reportable geographical segments.

ii. Segment revenue, results, assets and liabilities include the amounts identifiable to each of the segments as also amounts allocated, as estimated by the management. Assets and liabilities that cannot be allocated to identifiable segments are grouped under unallocated assets and liabilities.

2. RELATED PARTY DISCLOSURES (AS-18)

i. Jointly controlled entity

IDBI Federal Life Insurance Co Ltd.

ii. Key management personnel of the Bank

Shri R.M Malla, Chairman & Managing Director

Shri B.P.Singh, Deputy Managing Director (up to January 31, 2012)

Shri Bal Krishan Batra, Deputy Managing Director (w.e.f January 13, 2012)

iii. Transactions/balances with related parties:

3. OPERATING LEASE ( AS-19)

Amount of Rs. 157,59,29 Thousand (Rs. 161,25,46 Thousand) has been charged to the Profit and Loss Account during the year towards lease charges paid/payable on cancellable operating lease.

Hitherto, Deferred Tax Liability (DTL) as stipulated under Accounting Standard (AS- 22) dealing with "Accounting for Taxes on Income" was created on "Special Reserve created and maintained under section 36(1)(viii) of the Income Tax Act, 1961" (Special Reserve). However the Board of Directors of the Bank has passed a resolution that there is no intention to withdraw any amount from the Special Reserve. Taking this into consideration, as well as an expert opinion obtained by the Bank, the amount of Special Reserve for which deduction has been claimed and/ or allowed in computing taxable income in the earlier years and the current year is considered as a "permanent difference" under AS-22 instead of '' timing difference ''.

In view of the above, DTL of Rs. 183.64 crore created on such Special Reserve in the earlier years has been reversed and DTL of Rs. 65 crore has not been created in respect of Special Reserve appropriated out of the profits for the current year.

iii. Provision of Taxation for current year

Income Tax of Rs. 1104,93,20 Thousand has been provided for the year ended March 31, 2012 (Rs. 734,93,58 Thousand).

4. JOINT VENTURES (AS-27)

Investments include Rs. 384 crores (Rs. 336 crores) representing Bank's interest in the following joint venture.

5. IMPAIRMENT OF ASSETS (AS-28)

Fixed assets acquired by the bank are treated as 'Corporate Assets' and are not 'Cash Generating Unit' as defined by AS-28. In the opinion of the management there is no impairment of any of the fixed assets of the Bank.

6.OTHER DISCLOSURES

EMPLOYEES' STOCK OPTION SCHEME (ESOP)

3 Disclosures on risk exposure in derivatives- Qualitative disclosures

The Bank uses derivatives for hedging as well as for trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

(ii) The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organisation, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Department, headed by a Chief General Manager. The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

(iii) Risk exposures in derivative transactions are measured/ assessed in both quantitative and qualitative terms to capture credit risk, market risk, operational and legal risk. Prior to the execution of derivative transactions, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, greeks, stop loss etc. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

(iv) The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No 17 "Significant Accounting Policies of the Bank".

Working funds are reckoned as average of total assets (excluding accumulated losses, if any) as reported to Reserve Bank of India in Form X under Section 27 of the Banking Regulation Act, 1949, during the 12 months of the financial year.

Return on Assets is with reference to average working funds (i.e. total of assets excluding accumulated losses, if any).

For the purpose of computation of business per employee (deposits plus advances) inter bank deposits are excluded.

During the year ended March 31, 2012, the Bank's exposure to single borrowers and group borrowers were within the prudential exposure limits prescribed by RBI, except in one case where single borrower limit of 15% was exceeded with the approval of the Board of Directors. In respect of this case, the sanctioned limits and outstanding as % of capital funds (including non-funded exposure) were as follows, as on March 31, 2012:

Unsecured Advances:

Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken is Rs. 2,56 crore and the estimated value of intangible security as on March 31, 2012 is Rs. 18,34 crore on Pari - passu basis.

SECURITISATION

During the year ended March 31, 2012, the Bank has not securitized any pools of retail loans.

(a) The figures of the previous period include the working results of the two erstwhile wholly owned subsidiary of the bank namely IDBI Home Finance Ltd. and IDBI Gilts Ltd. for the period from 01.01.2011 to 31.03.2011 consequent on merging with the bank. Accordingly, the fi gures of the previous year are not strictly comparable. Figures for the previous year have been regrouped and rearranged wherever considered necessary to make them comparable with current year's fi gures.

b) Figures in brackets pertain to the previous year.

Compiled by : Dion Global Solutions Limited

ANNEXURE - A (Contd.)

Proper classification, valuation and accounting of the transactions in various portfolios.

Adequate and proper reporting of the transactions related to derivative, investment and foreign exchange products.

Effective control over the operation and execution of market related transactions.

Compliance with regulatory requirements.

The Market Risk Group (MRG), is responsible for Identification, assessment, monitoring and reporting of market risk in Treasury operations. The group also recommends changes in policies and methodologies for measuring market risk. The main strategies and processes of the group are

1. Delegation: Appropriate delegation of powers has been put in place for treasury operations. Investment decisions are vested with Investment Committee of the Board. MRG monitors the various limits, which have been laid down in the policies.

Controls: The systems have adequate data integrity controls. The controls are used for audit purpose.

Exception handling processes: The limits set in the policies have been inserted in the system for ensuring that the same is being enforced to minimize exceptions. The limit breaches/exceptions, if any, are ratifi ed immediately from the concerned authorities.

The MRG periodically reports on the forex, investment and derivative product related risk measures to the senior management and the committees of the Board. The Bank also reports to regulators as per the reporting requirements.

The Bank has devised various risk parameters for different products in line with the guidelines issued by RBI from time to time. These risk parameters are measured and reported to the senior management independently by MRG.

Mar 31, 2011

A Disclosure Requirements as per Accounting Standards

1. PREMISES (AS-10)

i. Premises include Leasehold Land (revalued) ofRs 1339,70,11 Thousand (Rs 1339,70,11 Thousand) which was revalued in the year 2006-07.

2. AMALGAMATION (AS-14)

Pursuant to the scheme of amalgamation of the erstwhile, wholly owned subsidiary of Bank namely IDBI Home Finance Ltd.(IHFL) a housing finance company and IDBI Gilts Ltd. (IGL), a Primary Dealer in securities. (hereinafter referred as 'transferor' Companies) approved by the Ministry of Corporate Affairs, Government of India on April 8, 2011 all assets and liabilities of transferor Companies were transferred and vested in IDBI Bank Ltd. (hereinafter referred as 'transferee' Bank) effective 01.01.2011.

The amalgamation has been accounted for under the 'Pooling of Interest' method as prescribed by the Accounting Standard -14 'Accounting for Amalgamations' issued by the Institute of Chartered Accountants of

India. Accordingly, assets and liabilities of transferor Companies as at January 1, 2011 have been incorporated in the financial statements of transferee Bank in the same manner and form as they appear in the financial statements of the transferor Companies. However the accumulated losses of a transferor Company namely IDBI Gilts Ltd. of Rs 39,70,93 Thousand has been adjusted against reserve of the transferee Bank.

In terms of Scheme of Amalgamation no shares of the transferee Bank are required to be issued to the shareholders of the transferor Companies as the amalgamation has been effected of the wholly owned subsidiaries of the Bank.

Some of the investments and title deeds held by transferor Companies are in the process of being transferred in the name of the transferee Bank.

3. Employee benefits (AS-15) (Revised):

i. Transitional Liability

The transitional liability arising on account of adoption of Accounting Standard-15 (Revised 2005) on "Employee Benefits" is Rs 63,22,00 Thousand (Pension - Rs 31,09,00 Thousand, Gratuity - Rs 16,41,00 Thousand, Disability Assistance - Rs 13,28,00 Thousand and Leave encashment - Rs 2,44,00 Thousand) (Rs 63,22,00 Thousand). Out of this, an amount of Rs 12,50,00 Thousand (Rs 12,50,00 Thousand) has been charged to Profit & Loss Account during the year. The balance unrecognized liability ofRs 12,50,00 Thousand (Rs 25,00,00 Thousand) have been carried forward and the same will be charged off in the next year.

ii. * Defined Contribution Scheme

Bank's employees are covered by Provident Fund to which the Bank makes a defined contribution measured as a fixed percentage of basic salary. The Provident Fund plan in the case of Bank is administered by the Administrators of 'IDBI Provident Fund Trust'/'IDBI Bank Employees Provident Fund Trust'. In respect of the employees of IHFL and IGL provident fund contributions are made to Regional Provident Fund Commissioner.

During the year an amount of Rs 4,26,73 Thousand (Rs 2,34,09 Thousand) has been charged to Profit and Loss Account.

iii. 'Defined Benefit Schemes

a. The Bank makes contributions for the gratuity liability of the employees, to the 'IDBI Bank Employees Gratuity Fund Trust'. The Gratuity Fund of employees of IHFL and IGL is continued with LIC under Group Gratuity Scheme.

b. Some of the employees of the Bank are also eligible for Pension which is administered by the 'IDBI Pension Fund Trust'.

The present value of these defined benefit obligations and the related current service cost are measured using the Projected Unit Credit Method with actuarial valuation being carried out at each balance sheet date.

iv. Other long term benefits

Employees of the Bank are entitled to accumulate their earned/ privilege leave upto a maximum of 180 days for officers and 300 days for other staff. A maximum of 15 days leave is eligible for encashment in each year. Some of the employees are eligible for Disability Assistance which is borne by the bank as and when the disability events occur.

In respect of IHFL the employees are entitled to accumulate leave upto maximum of 180 days/240 days based on their cadre and in respect if IGL leave upto 240 days can be accumulated.

Actuarial valuation of these benefits has been carried out using the Projected Unit Credit Method and an amount of Rs 39,54,98 Thousand (Rs 36,13,93 Thousand) has been charged to Profit and Loss Account during the year.

3. SEGMENT REPORTING (AS-17)

The bank operates in three segments wholesale banking, retail banking and treasury services. These segments have been identified in line with AS-1 7 on segment reporting after considering the nature and risk profile of the products and services, the target customer profile, the organization structure and the internal reporting system of the bank. The bank has disclosed business segment as the primary segment. The bank primarily operates in India, hence the bank has been considered to operate predominantly in the domestic segment and as such there are no reportable geographical segments.

ii. Segment revenue, results, assets and liabilities include the amounts identifiable to each of the segments as also amounts allocated, as estimated by the management. Assets and liabilities that cannot be allocated to identifiable segments are grouped under unallocated assets and liabilities.

18) RELATED PARTY DISCLOSURES (AS-18)

i. jointly controlled entity

ii. IDBI Federal Life Insurance Co Ltd.

Key management personnel of the bank

Shri R.M Malla, Chairman & Managing Director (w.e.f July 9, 2010)

Shri Yogesh Agarwal, Chairman & Managing Director (upto June 5, 2010)

Shri B.P.Singh, Deputy Managing Director

8. JOINT VENTURES (AS-27)

Investments includeRs 336 crores (Rs 216 crores) representing Bank's interest in the following joint venture.

9. IMPAIRMENT OF ASSETS (AS-28)

Fixed assets acquired by the bank are treated as "Corporate Assets' and are not "Cash Generating Unit' as defined by AS-28. In the opinion of the management there is no impairment of any of the fixed assets of the Bank.

10.2 OTHERS

Government of India has infused capital ofRs 3119.04 crores by way of preferential allotment of 259509110 equity share at a premium of Rs 110.19 per share on July 31, 2010.

ii. 197068 (80497) equity shares allotted during the year against ESOPs exercised.

iii. The Bank is reimbursed differential interest by Government of India (GOI) in respect of certain borrowings from Banks/Institutions which has since been discontinued on availment of the entire sanctioned amount. Accordingly, the interest charged to Profit & Loss Account is after considering Nil credit (Rs 3,26,35 Thousand) on account of reimbursement towards differential interest for the year.

iv. The status as at March 31, 2011 of the following schemes as formulated by Government of India is as under.

V. Based on the information to the extent received from 'enterprises' regarding their status under the 'Micro, Small & Medium Enterprises Development Act, 2006' there is no Micro, Small & Medium enterprise to which the Bank owes dues, which are outstanding for more than 45 days during the year ended March 31, 2011 and hence disclosure relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given.

vi. Estimated amount of contracts remaining to be executed on capital amount (net of advances) and not provided for is Rs85,45,97 Thousand (Previous YearRs 149,01,02 Thousand)

a) Margin by way of cash deposit/Collateral is required to be maintained by clients, in case Mark to Market (MTM) loss exceed the approved limit (set by the Bank)

b) Concentration of credit risk (Current exposure to the Bank) to top 5 corporate clients as at March 31 2011 is at 74.40% (72.71 %) of the total current exposure from Corporate Clients to the bank.

c) Terms of the forward rate agreement/ interest rate swap are upto 10 years.

3 Disclosures on risk exposure in derivatives- Qualitative disclosures

(i) The Bank uses derivatives for Hedging as well as for Trading purposes. The use of such derivatives gives rise to various risks like credit risk, market risk, operational risk, legal risk etc.

(ii) The Bank has a well defined structure to manage these risks, consisting of risk policy, risk management organisation, risk measurement and monitoring process, limit structure and system infrastructure. The Bank has an independent Risk Management Group, headed by a Chief General Manager. The Risk Management Group is functionally responsible for measurement, monitoring and reporting of risks in accordance with the policies, processes, parameters and limits defined by the Board as well as the applicable regulatory guidelines. Risk is managed under the overall supervision of Asset Liability Management Committee with regular reporting to Risk Management Committee of the Board as well as to the Board.

(iii) Risk exposures in derivatives transactions are measured/assessed in both quantitative and qualitative terms to capture credit risk, market risk and operational & legal risk. Prior to the execution of derivative transaction, it is ensured that credit risk exposure to the client/counterparty, measured in terms of Loan Equivalent Risk (LER), is within the approved limit and the client/counterparty has the necessary understanding of the transaction. Market risk exposure is measured and managed in terms of positions, duration or tenor, sensitivities to market rates, gaps, Greeks, Value-at-Risk, stop loss etc. measures. Operational risks are addressed by having adequate system infrastructure and control mechanism in place. Legal risks are taken care of by execution of necessary legal agreements and documentation.

(iv) The accounting policy for derivatives has been drawn up in accordance with RBI guidelines, the details of which are contained in Schedule No.1 7 "Significant Accounting Policies of the Bank".

Prudential Exposure Limits

During the year ended March 31, 2011, the Bank's exposure to single borrowers and group borrowers were within the prudential exposure limits prescribed by RBI, except in two cases where single borrower limit of 15% was exceeded with the approval of the Board of Directors. In respect of these cases, the sanctioned limits and outstanding (including non-funded exposure) were as follows, as on March 31, 2011:

XI Unsecured Advances:

Total amount of advances for which intangible securities such as charge over the rights, licenses, authority etc. has been taken is Rs 50 crore and the estimated value of intangible security as on March 31, 2011 is Rs 1257.82 crore on Pari - passu basis.

XXIV In terms of RBI Circular dated May 11, 2009 Nil amount (Rs 64,88 thousand ) has been credited to Profit and Loss account in respect of credit balance (net) towards unreconciled entries in nostra and mirror account. Further, these amounts have been appropriated to General Reserve and are not made available for declaration of dividend.

XXV (a) The figures of the current period include the working results of the two erstwhile wholly owned subsidiary of the bank namely IDBI Home Finance Ltd. and IDBI Gilts Ltd. for the period from 01.01.2011 to 31.03.2011 consequent on merging with the bank. Accordingly, the figures of the previous year are not strictly comparable. Figures for the previous year have been regrouped and rearranged wherever considered necessary to make them comparable with current year's figures.

Mar 31, 2010

Not Available

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Notes to Accounts of IDBI Bank Ltd.

b) Draw Down from Reserves

c) Set-off of Accumulated Losses

Qualitative disclosure around Liquidity Coverage Ratio (LCR)

High Quality Liquid Assets (HQLA):

Total net cash outflows:

Qualitative disclosure around Net Stable Funding Ratio (NSFR)

Available Stable Funding (ASF

Required Stable Funding (RSF)

Liquidity Management:

c) Sales and transfers to/from Held to Maturity (HTM) category

(g) Unhedged Foreign Currency Exposure

Qualitative disclosures

(d) Disclosure on Penalties imposed by Reserve Bank of India:

f Qualitative disclosures

(a) Information relating to the composition and mandate of the Nomination and Remuneration Committee:

(b) Information relating to the design and structure of remuneration processes and the key features and objectives of remuneration policy:

A description of the scope of the Bankâs remuneration policy, including the extent to which it is applicable to foreign subsidiaries and branches:

B. Long term contracts

C. Pending litigations

Disclosures as per RBI circular RBI/2016-17/122 DBR.No.BP.BC.34/21.04.132/2016-17 dated November 10, 2016

Disclosures on Flexible Structuring of Existing Loans

Disclosures on Strategic Debt Restructuring Scheme (accounts which are currently under the stand-still period)

Disclosures on Change in Ownership outside SDR Scheme (accounts which are currently under the standstill period)

Disclosures on Change in Ownership of Projects Under Implementation (accounts which are currently under the stand-still period)

/ Total net cash outflows :

Liquidity Management:

(a) Information relating to the composition and mandate of the Remuneration Committee:

Name, composition and mandate of the main body overseeing remuneration:

External consultants whose advice has been sought, the body by which they were commissioned, and in what areas of the remuneration process

A description of the scope of the Bankâs remuneration policy, including the extent to which it is applicable to foreign subsidiaries and branches:

A description of the type of employees covered and number of such employees:

(b) Information relating to the design and structure of remuneration processes and the key features and objectives of remuneration policy:

An overview of the key features and objectives of remuneration policy:

(c) Description of the ways in which current and future risks are taken into account in the remuneration processes.

Severance Pay/ Guaranteed Pay

Hedging

'' Malus/Clawback

(d) Description of the ways in which the Bank seeks to link performance during a performance measurement period with levels of remuneration:

(e) A discussion of the Bankâs policy on deferral and vesting of variable remuneration and a discussion of the Bankâs policy and criteria for adjusting deferred remuneration before vesting and after vesting:

(f) Description of the different forms of variable remuneration (i.e. cash, shares, ESOPs and other forms) that the Bank utilizes and the rationale for using these different forms:

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A description of the scope of the Bankâs remuneration policy, including the extent to which it is applicable to foreign subsidiaries and branches:

A description of the scope of the Bankâs remuneration policy, including the extent to which it is applicable to foreign subsidiaries and branches:

(e) A discussion of the Bankâs policy on deferral and vesting of variable remuneration and a discussion of the Bankâs policy and criteria for adjusting deferred remuneration before vesting and after vesting: