We consider a restructured account, if any, as one where we, for economic or legal reasons relating to the borrower's financial
difficulty, grant to the borrower concessions that we would not otherwise consider. Restructuring would normally involve
modification of terms of the advance/ securities, which would generally include, among others, alteration of repayment period/
repayable amount/ the amount of instalments/ rate of interest (due to reasons other than competitive reasons). However,
extension in repayment tenure of a floating rate loan on reset of interest rate, so as to keep the equated monthly instalment
(EMI) unchanged, provided it is applied to a class of accounts uniformly, will not render the account to be classified as
‘restructured account’. In other words, extension or deferment of EMIs to individual borrowers as against to an entire class,
would render the accounts to be classified as ‘restructured accounts’ except as permitted by the RBI.

Restructured accounts are classified as such by us only upon approval and implementation of the restructuring package.
Necessary provision for diminution in the fair value of the asset is made. Restructuring of an account, if any, is done at a
borrower level. Non-performing advances are written-off in accordance with our policies. Recoveries from bad debts written-
off are recognised in the Profit and Loss Account and included under ‘Other Income’. This will result in immediate down-
gradation of the loan, i.e., a standard loan will become sub-standard and attract provisions as per the asset classification and
subsequent provisioning norms. The NPAs, upon restructuring, would continue to have the same asset classification as prior to
restructuring and slip into further lower asset classification categories as per extant asset classification norms with reference to
the pre-restructuring repayment schedule. If such account classified as NPA performs regularly, it will be upgraded after
satisfactory performance during the specified period.

The erosion in the fair value of the advance is computed as the difference between the fair value of the loan before and after
restructuring. Fair value of the loan before restructuring is computed as the present value of cash flows representing the interest
at the existing rate charged on the advance before restructuring and the principal, discounted at the existing interest rate as on
the date of restructuring. Fair value of the loan after restructuring is computed as the present value of cash flows representing
the interest at the rate charged on the advance on restructuring and the principal, discounted at the existing interest rate on the
date of restructuring.

Additional finance approved under the resolution plan is treated as ‘Standard Asset’ during the specified period, provided that
the account performs satisfactorily during the specified period. If the restructured asset fails to perform satisfactorily during the
specified period or does not qualify for upgradation at the end of the specified period, the additional finance shall be placed in
the same asset classification category as the restructured debt. ‘Specified Period’ refers to the period from the date of
implementation of resolution plan up to the date by which at least 20% of the outstanding principal debt as per the resolution
plan and interest capitalisation sanctioned as part of the restructuring, if any, is repaid. Provided that, the specified period cannot
end before one year from the commencement of the first payment of interest or principal (whichever is later) on the credit
facility with longest period of moratorium under the terms of the resolution plan.

The SARS-CoV-2 virus responsible for COVID-19 continues to spread across the globe and India and has contributed to a
significant decline and volatility in global and Indian financial markets and a significant decrease in global and local economic
activities. On March 11, 2020, the COVID-19 outbreak was declared a global pandemic by the World Health Organisation.
Numerous governments and companies, including our Bank, introduced a variety of measures to contain the spread of the virus.
On March 24, 2020, the Indian government announced a 21-day lockdown which was further extended till May 31, 2020 to
contain the spread of the virus. The lock down continued in affected regions during the year as determined by central
government or the respective State governments. Internationally, countries are still fighting battle against the virus and putting
strict restrictions on movement of people, specially those coming in from various virus hotspots. The extent to which the
COVID-19 pandemic will impact our Bank’s results will depend on future developments, which are highly uncertain, including,
among other things, any new information concerning the severity of the COVID-19 pandemic and any action to contain its
spread or mitigate its impact whether government-mandated or elected by our Bank.

In accordance with the RBI guidelines relating to COVID-19 Regulatory Package dated March 27, 2020 and April 17, 2020,
our Bank has granted a moratorium of three months on the payment of all instalments and / or interest, as applicable, falling
due between March 1, 2020 and May 31, 2020 to all eligible borrowers, even if overdue, as on February 29, 2020. For all such
accounts where the moratorium is granted, the asset classification remained stand still during the moratorium period (i.e., the
number of days past-due shall exclude the moratorium period for the purposes of asset classification under the income
recognition, asset classification and provisioning norms). We have made a provision of = 108.69 million being 10% of overdue
standard accounts as on February 29, 2020 following RBI guidelines relating to COVID-19 regulatory package issued on April
17, 2020 and clarification provided by RBI to Indian Bank’s Association dated May 6, 2020.

RBI in its Statement on Developmental and Regulatory Policies dated May 22, 2020, permitted lending institutions to extend
the moratorium on term loan instalments for another three months, i.e., from June 1, 2020 to August 31, 2020. As the
moratorium/deferment is being provided specifically to enable borrowers to tide over COVID-19 disruptions, the same is not
treated as changes in terms and conditions of loan agreements due to financial difficulty of the borrowers and, consequently,
does not result in asset classification downgrade. The Bank continued to provide moratorium to eligible borrowers for the
instalments due between June 1, 2020 to August 31, 2020 following the RBI notification dated May 22, 2020.

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