Provisions and contingent assets/liabilities

A contingent liability is a possible obligation that arises
from past events whose existence will be confirmed
by the occurrence or non-occurrence of one or more
uncertain future events beyond the control of the
Bank or a present obligation that is not recognized
because it is not probable that outflow of resources
will be required to settle the obligation. A contingent
liability also arises in extremely rare cases where
there is a liability that cannot be recognized because
it cannot be measured reliably. The Bank does not
recognize a contingent liability but discloses its
existence in the Financial Statements.

The Bank creates a provision when there is a present
obligation as a result of a past event that probably
requires outflow of resources and a reliable estimate
can be made of the amount of the obligation.
Provisions are reviewed at each Balance Sheet date
and adjusted to reflect the current best estimate.
Provisions are not discounted to their present value
and are determined based on the best estimate
required to settle the obligation as at the reporting
date if it is no longer probable that an outflow of
resources would be required to settle the obligation,
the provision is reversed.

Contingent assets are neither recognized nor
disclosed in the Financial Statements.

4.13 Leases

Leases where the lessor effectively retains
substantially all the risks and benefits of ownership
of the leased item are classified as operating lease.
Operating lease payments are recognised as an
expense in the Profit and Loss Account on a straight
line basis over the lease term in accordance with
AS 19 - Leases.

4.14 Transaction involving Foreign Exchange

All transactions in foreign currency are recognised
at the exchange rate prevailing on the date
of the transfer.

Foreign currency monetary items are reported using
the exchange rate prevailing at the Balance Sheet date.

Non-monetary items which are measured in terms
of historical cost denominated in foreign currency
are reported using the exchange rate at the date of
transaction. Non-monetary items which are measured
at fair value or other similar value denominated in a
foreign currency are translated using the exchange
rate at the date when such value is determined.

Exchange differences arising on settlement of
monetary items or on reporting of such monetary
items at rates different from those at which they
were initially recorded during the Year, or reported
in previous Financial Statements, are recognised as
income or expense in the Year in which they arise.

4.15 Employee Share based payments

The Employee Stock Option Schemes (ESOSs) of the
Bank are in accordance with Securities and Exchange
Board of India (Share Based Employee Benefits)
Regulations, 2014. The Schemes provide for grant of
options on equity shares to employees of the Bank
to acquire the equity shares of the Bank that vest in a