Provisions, Contingent Liabilities and Contingent
Assets:

In conformity with AS 29, "Provisions, Contingent
Liabilities & Contingent Assets" issued by the
Institute of Chartered Accountants of India, the
bank recognizes provision only when:

a. It has a present obligation as a result of
past event.

b. It is probable that an outflow of resources
embodying economic benefits will be required
to settle the obligation, and

c. A reliable estimate of the amount of the
obligation can be made.

No provision is recognized:

a. For any possible obligation that arises from
past events and the existence of which will
be confirmed only by the occurrence or non¬
occurrence of one or more uncertain future
events not wholly within the control of the
bank.

b. Where it is not probable that an outflow of
resources embodying economic benefits will be
required to settle the obligation or

c. When a reliable estimate of the amount of
obligation cannot be made

Such obligations are recorded as Contingent Liabilities.
These are assessed at regular intervals and only that
part of the obligation for which the outflow of resources
embodying economic benefits is probable, is provided
for, except in the extremely rare circumstances where no
reliable estimate can be made.

i. Contingent Assets are not recognized in the

financial Statements.

Net Profit

The Net Profit in the Profit & Loss Account is

after:

(a) Provision for Taxation

(b) Provision on Non-Performing Advances

(c) Provision on Standard Assets

(d) Provision for Non-Performing Investments

(e) Provision for other usual & necessary
Items

10. Earnings Per Share

The Bank reports basic and diluted Earnings
Per Share in accordance with AS - 20 "Earnings
Per Share", issued by ICAI. Basic Earnings Per
Share is computed by dividing the net profit
after tax attributable to equity shareholders by
the weighted average number of equity shares
outstanding for the Year.

11. Cash Flow Statement

Cash flow Statement is reported by using indirect
method.

12. Segment Reporting

The Bank recognises the business segment as
the primary reporting segment and geographical
segment as the secondary reporting segment
in accordance with the RBI guidelines & in
compliance with AS-17 issued by ICAI.

b) Liquidity Coverage Ratio (LCR)

QUALITATIVE DISCLOSURE

Liquidity Coverage Ratio (LCR) standard has been
introduced with the objective that a Bank maintains
an adequate level of unencumbered High Quality
Liquid Assets (HOLAs) 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.

Minimum requirement of LCR as stipulated by RBI
is 100% for the calendar year 2019 onwards. RBI
has mandated the management of LCR at solo and
consolidated level.

HOLA comprises Level 1 assets (0% hair-cut), Level
2A assets (l5% hair-cut) and Level 2B assets (50%
hair-cut). Level 1 assets comprising cash, excess
CRR, excess SLR securities, Government securities to
the extent allowed by RBI under Marginal Standing
Facility (MSF) [2% of the Bank's Net Demand &
Time Liabilities (NDTL)] and Facility to Avail Liquidity
for Liquidity Coverage Ratio (FALLCR) [16% of the
Bank's NDTL]. Level 2A assets comprises sovereign
guaranteed marketable securities, corporate bonds
or commercial papers which are rated AA- and better,
issued other than by non-financial institutions.

Expected net cash outflows under stress are the
weighted sum of outflows minus inflows in the next
30 days. The inflows are taken with pre-defined hair¬
cuts and the outflows are taken at pre-defined run
off factors. Funding from retail and small business
customers carries lower run-off factor as compared
to wholesale funding.

Composition of HOLA: The Bank during the three
months ended 31^st March 2025 maintained average
HOLA of '3,20,508.13 crore. Level 1 assets contribute
to 99.07% of the total stock of HOLA. Facility to avail
Liquidity for Liquidity Coverage Ratio constitutes the
highest portion to HOLA i.e., around 64.40% of the
total HOLA. Level 2 assets which are lower in quality
as compared to Level 1 assets, constitute 0.93% of the
total stock of HOLA against maximum permissible
level of 40%.

Funding Profile: Unsecured wholesale funding
constitutes major portion of total weighted cash
outflow. Retail deposits and deposits from small
business customers put together contributed around
20.54% of the total weighted cash outflows. Deposits
from non-financial corporates, sovereigns, central

banks, multilateral development banks and PSEs
contributed around 32.42% of the total weighted
cash outflows. Bank's exposure is majorly in Indian
Rupee.

LCR of the Bank: Bank has maintained LCR well above
the minimum regulatory level on an ongoing basis.
Historical trend of Consolidated LCR of the Bank is as
follows:

The daily average LCR of Canara Bank (Consolidated)
for the quarter ended 31^st March 2025 was 125.26%.
The Bank has been maintaining HQLA mainly in the
form of SLR investments over and above the mandatory
requirements. The Bank has consistently kept a healthy
funding profile with a major portion of funding through
deposits. Retail deposits constitute major portion of total
funding sources which are well diversified. In addition to
daily / monthly LCR reporting, Bank also monitors the
liquidity position through various regulatory statements
viz. Structural Liquidity Statement and Stock Ratios.
Derivative exposures are considered insignificant due to
almost matching inflows and outflows position. During
the quarter, LCR for USD (significant foreign currency
constituting more than 5% of the balance sheet of the
Bank was 137.77% on average.

Liquidity Management in the Bank is driven by the ALM
Policy of the Bank and regulatory prescriptions. The ALCO
has been empowered by the Bank's Board to formulate
the Bank's funding strategies to ensure that the funding
sources are well diversified and is consistent with
the operational requirements of the Bank. Adequate
Contingency Funding Plan is also in place, which is
reviewed on periodic basis to ensure the availability of
funds to meet any stressed liquidity event. Monitoring of
liquidity is centralized at Risk Management Wing, Head
Office and managed centrally at Integrated Treasury
Wing, Head Office.

The following table summarizes the average of
unweighted and weighted value of the LCR components
for the 4^th quarter of FY 2024-25. The simple average
has been computed based on daily values for the three
months of quarter.

e) Divergence in asset classification and provisioning

As per RBI Master Direction No RBI/DOR/2021-
22/83 DOR.ACC.REC.No.45 / 21.04.018 / 2021-22
dated 30.08.2021 (Updated as on 01.04.2024) on
financial statements - presentation and disclosures,
divergence inthe asset classification and provisioning,
Banks should disclose divergences, if either or both
of the following conditions are satisfied:

i. The additional provisioning for NPAs assessed by
Reserve Bank of India as part of its supervisory
process, exceeds five percent of the reported
profit before provisions and contingencies for
the reference period, and

ii. The additional Gross NPAs identified by the
Reserve Bank of India as part of its supervisory
process exceeds five percent of the reported
incremental Gross NPAs for the reference period.

In our Bank, divergences are within the threshold
limit specified above, hence no disclosure on
divergence in asset classification and provisioning
for NPAs is required with respect to RBI's annual
supervisory process for FY 2024-25.

f) Disclosure of transfer of loan exposures

1. Details of loans transferred /acquired during the
period ended 31.03.2025 under the RBI Master
Direction on transfer of loan exposures dated
24.09.2021 are given below:

a) Bank has transferred/acquired Loans not in
default during the year ended 31.03.2025.

g) Unhedged foreign currency exposure

Reserve Bank of India vide its communication
Number DBOD.No.BP.BC. 85/21.06.200/2013-14
dated January 15 2014 advised the Bank to provide
incremental provision and capital with regard to
Bank's exposure to entities with unhedged foreign
currency exposures. Accordingly, for the financial
year 2024-25, Bank is holding a provision of '32.47
Crore (previous year ' 6.60 Crore) towards unhedged
foreign currency exposure.

Policy to manage currency induced credit risk with
regard to Unhedged Foreign Currency Exposure are
dealt with as per the guidelines issued by Reserve
Bank of India vide their notification DOR.MRG
REC.76/00-00- 007/2022-23 dated 11.10.2022

The Unhedged Foreign Currency Exposure (UFCE)
and Annual Earnings are computed before Interest
and Depreciation (EBID) for each borrower entity.
UFCE is arrived at first by calculating the gross foreign
currency exposure of the entity and then deducting
the extent of hedge by way of derivative contract
and natural hedge on account of cash flow from
operations (of the entity). The extent of potential
loss to the entity will be calculated by multiplying the
UFCE with Largest Annualised Volatilities (LAV) seen
in USD / INR rates during the last ten year period.
In case of Overseas Branches / Subsidiaries; potential
loss due to UFCE shall be computed by replacing INR
with the domestic currency of that jurisdiction and
USD with the foreign currency (i.e., currency other
than domestic currency of that jurisdiction) in which
the entity has maximum exposure. Potential loss on
account of exchange rate movements are compared
with annual EBID (Earnings Before Interest &
Depreciation) and expressed as a percentage of EBID
i.e., Potential loss / EBID percentage. As a prudential
measure, Bank is holding incremental capital and
make incremental provisioning (over and above the
extant standard assets provisioning) on the total
credit exposure to such entities at the specified rates.

c) Disclosures on risk exposure in derivatives

I) Qualitative disclosures

The Credit Risk Management Policy, approved by
the Board of Directors, on the use of derivative
instruments to hedge / trade is in place.

a) The Investment Portfolio of the Bank consists
of assets with characteristics such as fixed
interest rate, zero coupon and floating
interest rates and is subject to interest
rate risk. The Bank has also issued Tier I &
Tier II bonds and this capital cost is at fixed
rate with no exit option. The policy permits
hedging the interest rate risk on this liability
as well.

The Bank is permitted to use Forward Rate
Agreement (FRA) and Interest Rate Swap
(IRS) and only plain vanilla transactions are
permitted. These instruments are used not
only for hedging the interest rate risk in the
investment portfolio, but also for market
making and on behalf of clients on back-to-
back basis.

During the year the Bank has undertaken
derivative trades in IRS under the Proprietary
Portfolio and on behalf of clients on back-to-
back basis.

Buy-Sell Swaps (Proprietary) were undertaken
during the year. No FRAs were undertaken
during the year.

b) The risk management policies and
major control limits like stop loss limits,
counterparty exposure limits, PV01, etc.
approved by the Board of Directors are
in place. These risk limits are monitored
and reviewed regularly. MIS/Reports are
submitted periodically to Risk Management
Committee. The hedge effectiveness of the
outstanding derivative deals is monitored in
relation to the underlying asset / liability on
fortnightly basis.

c) Accounting Policy

Hedge Positions

• Accrual on account of interest expenses/
income on the IRS are accounted and
recognized as income / expense.

• Hedge effectiveness of the outstanding
derivative deals are monitored in relation
to the fair value of the swap and underlying
asset / liability. The Bank has used the
relevant INBMK yield spread as declared by
FIMMDA for arriving at the fair value of the
underlying Asset / Liability. If the hedge is
not effective, hedge swaps are accounted as
trading swaps. If swap is terminated before
maturity, the MTM loss / gain and accruals
till such date are accounted as income /
expense under Interest Paid / received on IRS.

Trading Positions

• Trading swaps are marked to market at
frequent intervals and changes are recorded
in the income statements.

• Accrual on account of interest expenses/
income on the IRS are accounted and
recognized as income / expense.

• Gains or losses on termination of swaps are
recorded as immediate income or expenses
under the above head.

12. Disclosure of penalties imposed by the
Reserve Bank of India

Penalties imposed by the Reserve Bank of India
(except for currency chest and operational Issues)
under the following provisions during the Financial
Year 2024-25 are detailed in the below table:

(i) Banking Regulation Act, 1949

(ii) Payment and Settlement Systems Act, 2007 and

(iii) Government Securities Act, 2006

(for bouncing of SGL)

f) Implementation of IFRS converged Indian
Accounting Standards

As per RBI guidelines, the Bank is in the process of
implementing the Indian Accounting Standards
(Ind AS). A Project Steering Committee headed by
Executive Director has been formed to take the
required steps on a continuous basis for smooth
convergence. RBI, vide its communication ref: DBR.
BP.BC.No.29/21.07.001/2018-19 dated 22^nd March
2019 has deferred implementation of Ind AS for
all Scheduled Commercial Banks till further notice.
Bank is submitting Ind AS Pro-Forma Financial
Statements to RBI for every half year starting from
September 2021 as per the guidelines of RBI.

h) The current tax expenses and deferred tax
expenses are determined in accordance with the
provisions of the Income Tax Act, 1961 and as per
the Accounting Standard 22"Accounting for Taxes
on Income" issued by the Institute of Chartered
Accountants of India respectively after taking into
account taxes paid at the foreign offices, which are
based on the tax laws of respective jurisdictions.

i) Disclosure on amortization of expenditure on
account of enhancement in family pension of
employees of Bank - Nil

j) Disclosure of Letters of Comfort (LoCs) issued by
Bank

Bank has not issued any Letters of Comfort during
the financial year 2024-25.

Only one LOC issued vide dated 03/08/2009
in favour of Central Bank of UAE on behalf of
Representative Office, Sharjah is outstanding as
on date.

Financial Impact

As our Representative Office, Sharjah is not
undertaking any commercial operations; there
is no financial impact of LOC issued in favour of
Central Bank of UAE.

Disclosure regarding Letter of Undertaking-
cum-Indemnity issued by the Bank in favour of
Trustees, Canara Robeco Mutual Fund:

During FY 2023-24, the Bank has issued Letter
of Undertaking-Cum-Indemnity for '13.05 Cr. in
favour of Trustees, Canara Robeco Mutual Fund
with regards to one pending litigation pertaining
to erstwhile Canstar Scheme of Canbank
Investment Management Services.

The Bank is already holding 100% provision in this
regard.

15. Accounting Standards

In compliance with the guidelines issued by the
RBI regarding disclosure requirements of the
various Accounting Standards issued by Institute
of Chartered Accountants of India (ICAI), the
following information is disclosed:

a) Accounting Standard 5 - Net Profit / Loss for
the period, prior period items and changes in
accounting policies:

There are no material prior period items.

b) Accounting Standard 11 - The Effects of
Changes in Foreign Exchange Rates

Accounting for transactions involving foreign
exchange is done in accordance with AS-11 on
"The Effects of Changes in Foreign Exchange
Rates", issued by the ICAI. In the terms of
AS-11, the foreign currency operations of the
Bank are classified as a) Integral Operations
and b) Non-Integral Operations.

All overseas branches, offshore banking units,
overseas subsidiaries are treated as non¬
integral operations and domestic operations
in foreign exchange and representative
offices area treated as integral operations.

c) Accounting Standard 15 - Employee Benefits

The actuarial assumptions in respect of
gratuity, pension and privilege leave, for
determining the present value of obligations
and contributions of the Bank, have been
made by fixing various parameters for:

- Salary escalation by taking into account
inflation, seniority, promotion and
other factors mentioned in Accounting
Standard 15 (Revised) issued by ICAI.

- Attrition rate by reference to past
experience and expected future
experience and includes all types of
withdrawals other than death but
including those due to disability.

- Provision towards sick leave has been
made in the books of account on the basis
of Actuarial valuation.

e) Accounting Standard 18 - Related Party Disclosures

Names of Related parties and their relationship

with the Bank - Parent - Canara Bank

Key Management Personnel -

i) Shri. K. Satyanarayana Raju,

Managing Director & Chief Executive Officer

ii) Shri. Debashish Mukherjee,

Executive Director

iii) Shri. Ashok Chandra, Executive Director
(till 16^th January 2025)

iv) Shri. Hardeep Singh Ahluwalia,

Executive Director

v) Shri. Bhavendra Kumar, Executive Director

vi) Shri. S K Majumdar, Executive Director
(w.e.f. 24^th March 2025)

vii) Shri. S K Majumdar, Group Chief Financial
Officer (24^th March 2025)

viii) Shri. Amit Mittal, Group Chief Financial
Officer (w.e.f. 25^th March 2025)

ix) Shri. Santosh Kumar Barik,

Company Secretary

Parent -

i) Canara Bank

Subsidiaries -

i) Canbank Financial Services Ltd.

ii) Canbank Venture Capital Fund Ltd.

iii) Canbank Factors Ltd.

iv) Canara Robeco Asset Management
Company Ltd.

v) Canbank Computer Services Ltd.

vi) Canara Bank Securities Ltd. (formerly GILT
Securities Trading Corpn. Ltd.)

vii) Canara HSBC Life Insurance Company Ltd.

viii) Canara (Tanzania) Ltd.^**

ix) CRMF Trustee Private Limited
(From Nov 2024)

** Canara Tanzania Ltd. (In Liquidation ) (CTL), a wholly-
owned subsidiary of the Bank has transferred its major
assets and liabilities to M/s. Exim Bank Tanzania Ltd.,
and surrendered the license. Thereafter the company CTL
has started the process of liquidation.

Joint Ventures - Nil

Associates -

i) Can Fin Homes Ltd.

ii) Regional Rural Banks sponsored by the Bank#

a) Karnataka Gramin Bank

(Erstwhile Pragati Krishna Gramin Bank)

b) Kerala Gramin Bank

(Erstwhile South Malabar Gramin Bank)

c) Andhra Pragathi Grameena Bank

d) Karnataka Vikas Grameena Bank

# Vide letter No. CGH-DL-E-07042025-262329 dated
07.04.2025, Department of Financial Services, Ministry
of Finance, Government of India has proposed
amalgamation of Regional Rural Banks (RRBs) under
the concept "One State - One RRB" w.e.f. 01.05.2025.
The Bank's investments in these RRBs are included in
its financial statements as at 31^st March 2025. Details
of the amalgamation of RRBs sponsored by our Bank
are as under:

HIGHER EDUCATION FINANCING AGENCY (HEFA):

Higher Education Financing Agency (HEFA) is a joint
venture of Ministry of Human Resources Development
(MHRD) (now Ministry of Education (MoE)),
Government of India (90.91%) and Canara Bank (9.09%).

The Objective is for financing creation of capital assets in
premier educational institutions in India, building world
class educational institutes, setting up research facilities,
intending to provide a platform through special purpose
vehicle for improvement of infrastructure standards of
IITs, IIMs, AIIMS, IISc, NIT, IIIT etc.

Based on this the MoE (erstwhile MHRD) proposed to
set up Higher Education Financing Agency (HEFA) a Joint
Venture Company with an initial authorized capital of
'2000 Cr. MHRD has contributed '1,000 Cr. and Canara
Bank has contributed proportionately '100 Cr.

Subsequently, the authorized capital has been increased
to '10,000 Cr wherein Govt. will provide an additional
equity of '5,000 Cr. and Canara Bank will contribute
'500 Cr. As on 31.03.2025, MoE has infused Capital
of '4,812.50 Cr. and Canara Bank has contributed
'481.25 Cr.

f) Accounting Standard 27 - Financial Reporting of
Interests in Joint Ventures

Not applicable, since no interest in any Joint
Venture as on 31-03-2025.

g) Accounting Standard 28 - Impairment of Assets

Assets are reviewed for impairment at the end
of the year whenever events or changes in
circumstances warrant that the carrying amount
of an asset may not be recoverable. Recoverability
of an asset to be held and used is measured by a
comparison for the carrying amount of an asset
to future net discounted cash flows expected
to be generated by the asset. If such an asset is
considered to be impaired, the impairment to be
recognized and is measured by the amount by
which the carrying amount of the asset exceeds
the recoverable amount of the asset. However, in
the opinion of the Bank's Management, there is
no indication of material impairment to the assets
during the year to which Accounting Standard 28
- "Impairment of Assets" applies.

16. During the year ended 31.03.2025, Bank has
issued Basel III Compliant Additional Tier I Bonds
aggregating to '3,000 Crore and Tier II Bonds
of '4,000 Crore through private placement and
redeemed of '4,150 Crore Basel lll Compliant Tier
II Bonds and '1,500 Crore Additional Tier I Bonds
due to maturity.

17. As per RBI guidelines, DOR.ACC.REC.
No.91/21.04.018/2022-23 dated December 13,
2022 the details of the item under Schedule
5/11/14/16 i.e. Other Liabilities/Other Assets/
Other Income / other expenses exceeding 1% of
the total Assets/ Total income is as under:

18. During the year, Bank has transferred '1,000 crore
to Special Reserve created u/s 36 (1) (viii) of Income
Tax Act, 1961.

19. As per RBI circular RBI/DOR/2024-25/135 DOR.
STR.REC.72/21.04.048/ 2024-25 March 29, 2025;
on guidelines for government-guaranteed security
Receipts, banks are permitted to reverse any excess
provision to the profit and loss Account in the year
of transfer of loan to Asset reconstruction company
(ARC) for the value higher than the net book value
(NBV), provided the consideration consists solely
of cash and SRs guaranteed by the Government
of India. Such SRs shall be valued periodically by
reckoning the Net Asset Value (NAV) declared by
the ARC based on the recovery ratings received for
such instruments. In Q4 FY25, the Bank has reversed
excess provision of '1724.38 Crore to the Profit and
Loss Account held on loans transferred to NARCL.
Further the Bank has accounted unrealized gain in
the Profit & Loss account amounting to '97.02 crore
on account of fair valuation of Security Receipts
guaranteed by Government as on 31.03.2025

20. Figures of the previous year have been regrouped/
rearranged / reclassified wherever necessary.

ANJANEYULU CHERUKURI SHEIKH MOHD. WASEEM DEEPAK KUMAR JENA

DIVISIONAL MANAGER DIVISIONAL MANAGER ASSISTANT GENERAL

MANAGER

MOHD. MOIN AMIT MITTAL

ASSISTANT GENERAL MANAGER GENERAL MANAGER & GCFO

S K MAJUMDAR BHAVENDRA KUMAR ^H^^RDEEP, ^P¹"¹ DEBASHISH MUKHERJEE

AHLUWALIA

EXECUTIVE DIRECTOR EXECUTIVE DIRECTOR ._lmwl_ ^_IDI_, EXECUTIVE DIRECTOR

EXECUTIVE DIRECIOR

K. SATYANARAYANA RAJU VIJAY SRIRANGAN PARSHANT KUMAR GOYAL ROHIT DAS

MANAGING DIRECTOR & CHAIRMAN DIRECTOR DIRECTOR

CHIEF EXECUTIVE OFFICER

BIMAL PRASAD SHARMA ABHA SINGH YADUVANSHI HEMANT BUCH NALINI PADMANABHAN

DIRECTOR DIRECTOR DIRECTOR DIRECTOR

AS PER OUR REPORT OF EVEN DATE

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