IndusInd Bank Ltd
Directors Reports
The Board of Directors of the Bank have pleasure in presenting the Twenty-seventh
Annual Report covering business and operations of the Bank, together with the Audited
Financial Statements for the year ended March 31, 2021.
The financial performance for the year ended March 31,2021 is summarized as under:
|
|
(Rs. in crores) |
Particulars |
As on March 31, 2021 |
As on March 31, 2020 |
Deposits |
256,204.96 |
202,039.81 |
Advances |
212,595.41 |
206,783.17 |
Operating Profit (before Depreciation and Provisions and Contingencies) |
12,032.08 |
11,050.68 |
Net Profit |
2,836.39 |
4,417.91 |
The financial year under review was severely impacted by the COVID-19 pandemic, as the
entire world was affected in a manner unseen for more than a century. The beginning of the
financial year witnessed a country-wide lockdown which was lifted in phases since June
2020. From the unprecedented low level of economic activity and a technical recession in
H1 FY 2020-21, the economy started a swift recovery on the back of fiscal measures taken
by the Government of India and monetary policy support and regulatory forbearances
provided by the Reserve Bank of India. While the economic recovery was progressing well,
towards the end of the year a second and more virulent wave of the pandemic has affected
some parts of the country.
During the year, the Bank embarked on multiple initiatives to fortify the Balance Sheet
such as expanding and granularising the deposit franchise, rebalancing the loan book with
a moderate growth year on year, improving the rating and tenor profile of the loan book,
and augmenting capital and provision buffers to build resilience. The business of the Bank
improved with Deposits growing by 26.81% and Advances by 2.81% over the previous year.
Operating Profit (before Depreciation and Provisions and Contingencies) rose by 8.88%
to Rs.12,032.08 crores, as compared to Rs.11,050.68 crores in the previous year.
The Bank significantly increased the provision buffers prudentially so as to mitigate
any potential impact arising out of the pandemic. The total Provisions and Contingencies
recognised in the Profit and Loss account during the year were Rs.8,890.28 crores, an
increase of 40% over Rs.6,354.80 crores recognized during the previous year. Consequently,
the Net Profit of the Bank for the year under review, after considering all expenses and
Provisions and Contingencies, amounted to Rs.2,836.39 crores, as against Rs.4,417.91
crores in the previous year.
Appropriations
The Directors recommend appropriation of Profit as under:
|
(' in crores) |
Operating Profit before Depreciation and Provisions and Contingencies |
12,032.08 |
Less: Depreciation on Fixed Assets |
305.41 |
Less: Provisions and Contingencies inclusive of Income Tax |
8,890.28 |
Net Profit |
2,836.39 |
Profit Brought Forward |
13,483.66 |
Amount available for Appropriation |
16,320.05 |
Transfer to Statutory Reserve |
709.10 |
Transfer to Capital Reserve |
130.01 |
Dividend (including Tax on Dividend) |
- |
Deduction during the year |
(480.44) |
Total Appropriations |
391.45 |
Balance carried over to Balance Sheet |
15,928.61 |
Dividend
The Earning Per Share of the Bank during the year amounted to Rs.38.75.
The RBI vide its Circular dated April 22, 2021, advised that banks may pay dividend on
equity shares from the profits for the financial year ended March 31, 2021 subject to the
quantum of dividend being not more than fifty percent of the amount determined as per the
dividend payout ratio prescribed in Circular dated May 4, 2005. Accordingly, the Board of
Directors, in their meeting held on April 30, 2021, have proposed dividend of Rs.5 per
equity share. This proposal is subject to the approval of the shareholders at the ensuing
27th Annual General Meeting.
Members may note that the Bank did not declare dividend for the year ended March
31,2020, in compliance with RBI Circulars dated April 17, 2020 and December 4, 2020.
Financial Performance and state of the affairs of the Bank
The year under review was the first year of the new Triennial Planning Cycle of the
Bank, (Planning Cycle 5, for Financial Years 2020-23) with the theme "Digitize to
Differentiate, Diversify and Create Domain Expertise Underscored by Sustainability
(4D+S)". In view of the pandemic, the focus of the Bank during the year under review
was in building resilience, fortifying the balance sheet, improving the loan book profile,
and granularising the deposit franchise. While Deposits grew by 26.81% year- on-year, the
Advances grew only by 2.81% over the previous year and the Bank continued to be liquid. A
large part of the retail customers and some of the corporate customers who were impacted
by the pandemic availed of the moratorium offered by the Bank on payment of instalments
and interest in accordance with the RBI guidelines, and the loan origination activity was
largely subdued.
The Total Income of the Bank for the year under review grew by 5.66% to Rs.20,086.51
crores from Rs.19,010.05 crores. Net Interest Income increased by 12.18% to Rs.13,527.89
crores from Rs.12,058.74 crores.
In view of the low level of economic activity, the Non-Interest Income fell 5.65% to
Rs.6,558.61 crores from Rs.6,951.31 crores. Core Fee Income such as, commission, exchange,
loan processing and account management fees, fees on Investment Banking and distribution
of third-party products, and earnings from foreign exchange business declined by 19.13% to
Rs.4,679.22 crores from Rs.5,785.83 crores during the previous year.
Abundant liquidity available in the system kept the interest rates in a narrow range.
While Yield on Advances fell marginally to 11.84% as compared to 11.98% in the previous
year, the Cost of Deposits registered a sharper decline to 5.38% from 6.51% a year ago.
Consequently, the Net Interest Margin for the year improved to 4.17%.
The Bank expanded its branch network to reach 2,015 branches/banking outlets, as
against 1,911 branches/banking outlets at the beginning of the year. The extended network
of the Bank comprised 2,872 ATMs, 2,289 branches of Bharat Financial Inclusion Limited
(BFIL), and 828 outlets of IndusInd Marketing and Financial Services Private Limited, an
associate entity. Revenue per employee during the year improved to Rs.67.72 lakhs.
On account of the significant prudential provision buffers added during the year, the
Net Non-Performing Assets of the Bank improved to 0.69% as on March 31,2021 as compared to
0.91% a year ago. Return on Assets for the year stood at 0.90%.
Some of the significant events during the year are listed below:
In June 2020, consequent to the rating downgrade of the issuer rating of the
Government of India by a notch, Moody's Investors Service downgraded the long-term local
and foreign currency deposit ratings of IndusInd Bank to Ba1 from Baa3, the Baseline
Credit Assessment to ba2 from ba1, and the outlook was considered negative. Driven by
improvement in the capital and funding franchise, and marginal asset quality deterioration
because of the economic disruptions from the pandemic, in March 2021, Moody's affirmed the
long term local and foreign currency deposit rating of the Bank at Ba1, while adjusting
the Baseline Credit Assessment to ba2, and revising the outlook to stable from negative.
Reserve Bank of India made multiple policy interventions, aimed at the macro
economy as well as diverse groups of borrowers, so as to mitigate the adverse effect of
the COVID pandemic. In accordance with RBI Circulars dated March 27, 2020, April 17, 2020
and May 23, 2020, a moratorium on loan instalments and interest payable up to six months
during the period March 1,2020 until August 31,2020 was offered to eligible borrowers. The
moratorium period led a freeze in the days-past-due status and NPA classification. In
order to facilitate revival of real sector activities and mitigate the impact on the
ultimate borrowers, RBI Circular dated August 6, 2020 provided a window under the
Prudential Framework enabling the Bank to implement a Resolution Plan in respect of
eligible corporate exposures, while classifying such exposures as Standard, subject to
certain specified conditions.
On September 3, 2020, vide an interim order, the Hon'ble Supreme Court of India
barred banks from recognizing new NPA accounts. On March 23, 2021, the Hon'ble Supreme
Court pronounced its judgment in the matter, and ordered waiver of interest on interest
during the moratorium period on all loan accounts irrespective of whether moratorium was
extended or not, and the embargo on NPA recognition vide the interim order was also
vacated. In conformity with the SC judgement, RBI on April 7, 2021 advised that all
lending institutions shall put in place a Board approved policy to refund/adjust the
interest on interest, compound interest and/or penal interest charged to the borrowers
during the moratorium period, i.e. between March 1,2020 and August 31,2020. As suggested
in the RBI Circular, the Indian Banks Association provided a common methodology for
calculation of the amount to be refunded/adjusted for different facilities, and
accordingly, the Bank assessed the impact and created a provision of Rs.30 crores, to be
refunded/credited to various borrower accounts.
In order to provide relief to retail borrowers in select segments, the
Department of Financial Services, Govt. of India, announced on October 23, 2020, an
ex-gratia scheme for payment of difference between compound interest and simple interest
for six months between March 1,2020 and August 31,2020. Accordingly, by the due date of
November 5, 2020, the Bank credited the borrower accounts for an amount of Rs.121 crores
to eligible borrowers and filed a claim with the State Bank of India, the nodal agency. On
March 31,2021, the Government of India reimbursed the Bank fully.
Performance of Subsidiary and Associate Company
During the year under review, Bharat Financial Inclusion Limited (BFIL), the
wholly-owned subsidiary of the Bank, earned revenue of Rs.1,316.66 crores as against
Rs.881.63 crores earned during the previous year. The Net Profit for the year under review
amounted to Rs.153.48 crores as against Rs.39.95 crores for the previous year. As a
Business Correspondent undertaking, the strength of BFIL lies in its talent pool of
trained and motivated employees, that stood at 27,561 as on March 31, 2021.
IndusInd Marketing and Financial Services Private Limited (IMFS) is an Associate
Company of the Bank as 30% of its share capital is held by the Bank. IMFS is engaged in
the business of providing manpower services, and during the year under review, earned a
revenue of Rs.300.59 crores as against Rs.329.23 crores earned in the previous year. The
net profit earned by IMFS during the year under review amounted to Rs.0.88 crores as
against Rs.1.05 crores earned in the previous year. IMFS had 12,255 employees on its rolls
as on March 31,2021.
Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 8 of Companies
(Accounts) Rules, 2014, the Bank has drawn up a Consolidated Financial Statement including
the Financial Statement of its Subsidiary Company and Associate Company, and such
Consolidated Financial Statement is included in this Annual Report.
In accordance with the fourth proviso to Section 136(1) of the Companies Act, 2013, the
Standalone Financial Statements and the Consolidated Financial Statement, including
audited accounts of BFIL and IMFS and all other documents required to be attached thereto
have been hosted on the website of the Bank at:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
A Statement containing the salient features of the financial position of the Subsidiary
and Associate Company in Form AOC-1 is enclosed as 'Annexure' to the Financial Statements.
The Bank does not have any joint venture company and the subsidiary is not a material
subsidiary in terms of SEBI (LODR) Regulations.
Share Capital
In the Extraordinary General Meeting held on August 25, 2020, the members approved
Preferential Allotment of equity shares of '10 each, fully paid, at a price of Rs.524 per
equity share, to five Qualified Institutional Buyers and two corporate entities including
one of the promoters. Accordingly, in compliance with the applicable laws and regulations,
4,76,29,768 equity shares were allotted on September 2, 2020 to the Qualified
Institutional Buyers and 1,51,17,477 equity shares were allotted on September 4, 2020 to
two corporate entities, pursuant to the approval of the Finance Committee on the
respective dates.
Consequently, the equity share capital of the Bank increased by Rs.62.75 crores and
share premium account by Rs.3,196.39 crores, net of share issue expenses.
Pursuant to the Composite Scheme of Arrangement with Bharat Financial Inclusion
Limited, the Bank allotted 1,57,70,985 Share Warrants to the Promoters of the Bank on July
6, 2019, on receipt of the subscription amount at 25% of the price of Rs.1,709 per Share
Warrant. Each Share Warrant was convertible to one equity share of the Bank fully paid,
upon exercise of the option by paying the remaining amount. On February 18, 2021, the
promoters exercised the option of conversion and paid Rs.2,021.45 crores, being the
remaining consideration of 75% of the price of Share Warrants. Consequently, the Bank
allotted 1,57,70,985 equity shares of Rs.10 each fully paid at a price of Rs.1,709 per
equity share, and the share capital increased by Rs.15.77 crores and share premium by
Rs.2,679.49 crores.
During the year, 13,18,331 equity shares of Rs.10 each fully paid were allotted on
various dates to the employees who exercised their stock options, and consequently, the
share capital of the Bank increased by Rs.1.32 crores and share premium by Rs.53.05
crores.
The Bank has not issued any equity shares with differential voting rights.
Debentures
The Bank did not issue any debentures during the year under review.
Being a Scheduled Commercial Bank, compliance with SEBI Circular No.:
SEBI/HO/DDHS/CIR/P/2018/144 dated November 26, 2018 on fund-raising by issuance of Debt
Securities by Large Entities is not applicable to the Bank.
In compliance with Regulation 53 of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the names of the Debenture Trustees with their contact
details are given below:
Trustee I:
Name of Debenture Trustees: Catalyst Trusteeship Limited (formerly GDA Trusteeship
Ltd.)
Address |
: GDA House, S. No. 94/95, Plot No. 85, Bhusari Colony (Right), Paud Road, Pune -
411038, Maharashtra, India. |
Website |
: www.catalysttrustee.com |
E-mail |
: dt@ctltrustee.com |
Trustee II: |
|
Name of Debenture Trustees |
: Beacon Trusteeship Limited |
Address |
: 4C&D, Siddhivinayak Chambers, Gandhi Nagar, Opp. MIG Club, Bandra (East), Mumbai
- 400 051. |
Website |
: www.beacontrustee.co.in |
E-mail |
: info@beacontrustee.co.in |
Tier 2 Capital
The Bank did not issue any Tier 2 Capital instruments during the year. As on March
31,2021, the value of outstanding Tier 2 Capital instruments is Nil.
Deposits
The Bank is a banking company governed by the Banking Regulation Act, 1949, and as
such, the provisions of the Companies Act, 2013 relating to acceptance of Public Deposits
are not applicable.
Capital Adequacy
The Bank continues to be adequately capitalized. The Capital Adequacy Ratio of the
Bank, calculated under the Basel III Capital Regulations mandated by RBI, is set out
below:
Particulars |
March 31, 2021 |
March 31, 2020 |
i) Capital Adequacy Ratio (CRAR) |
17.38% |
15.04% |
ii) CRAR- Common Equity Tier 1 Capital |
15.55% |
13.22% |
iii) CRAR- Tier 1 Capital |
16.83% |
14.57% |
iv) CRAR- Tier 2 Capital |
0.55% |
0.47% |
Credit Ratings
Instruments |
Rating |
Rating Agency |
Domestic Ratings |
|
|
Infra Bond program |
AA+ |
CRISIL |
Additional Tier I Bond Program |
AA |
CRISIL |
Certificates of Deposit Program |
A1 + |
CRISIL |
Short Term FD Program |
A1 + |
CRISIL |
Senior Bonds program |
AA+ |
India Ratings and Research |
Additional Tier I Bond Program |
AA |
India Ratings and Research |
Short Term Debt instruments |
A1 + |
India Ratings and Research |
International Ratings |
|
|
Senior Unsecured MTN Programme |
Ba1 |
Moody's Investors Service |
Bank's Directors
The Bank's Board comprised eight Directors as on March 31, 2021, viz., Mr. Arun Tiwari,
Non-Independent Non-Executive, Part-time Chairman, six Independent, Non-Executive
Directors, viz., Mr. Shanker Annaswamy, Dr. T. T. Ram Mohan, Mrs. Akila Krishnakumar, Mr.
Rajiv Agarwal, Mr. Sanjay Asher, and Mrs. Bhavna Doshi, and Mr. Sumant Kathpalia, Managing
Director & CEO.
Mr. Sanjeev Kumar Asthana had resigned from the Bank's Board with effect from the close
of business hours on July 27, 2020, owing to his acceptance of a new role as the CEO of a
corporate, impacting his being a Director in the Bank's Board with specialised
knowledge/practical experience in Agriculture & Rural Economy, as laid down in the
Banking Regulation Act, 1949.
(a) Non-Executive, Independent Directors
All Independent Directors have submitted Declarations that they meet the criteria of
independence as laid down under sub-section (6) of Section 149 of the Companies Act, 2013.
In compliance with Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, and based on these Declarations, the following Non-Executive Directors
continue to be identified as Independent Directors as on March 31,2021:
(i) Mr. Shanker Annaswamy
(ii) Dr. T. T. Ram Mohan
(iii) Mrs. Akila Krishnakumar
(iv) Mr. Rajiv Agarwal
(v) Mr. Sanjay Asher
(vi) Mrs. Bhavna Doshi
In addition, the Bank's Board of Directors have, pursuant to Regulation 25(9) of SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, obtained Certificate
from M/s Bhandari & Associates, Practicing Company Secretaries that the aforesaid
Directors meet the 'Criteria of Independence' and are independent of the Management. The
Certificate submitted by M/s Bhandari & Associates is furnished at Annexure I,
and forms an integral part of this Report.
(b) Woman Director
In terms of the provisions of Section 149 of the Companies Act, 2013, read with Rule 3
of the Companies (Appointment and Qualification of Directors) Rules, 2014, and Regulation
17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, specified
companies are required to have at least one Woman Director in their Board.
Mrs. Akila Krishnakumar (DIN: 06629992), who joined the Board on August 10, 2018 is
a Non-Executive, Independent Woman Director, and Chairs some important Committees of the
Board.
Mrs. Bhavna Doshi (DIN: 00400508), who joined the Board on January 14, 2020, is a
Non-Executive, Independent Woman Director, and Chairs the Stakeholders' Relationship
Committee.
(c) Chairman of the Board
Mr. Arun Tiwari (DIN: 05345547) assumed charge as Part-time, Non-Executive Chairman
of the Bank with effect from January 31,2020, and shall hold office for a period of three
years, up to January 30, 2023, as approved by the Reserve Bank of India.
Mr. Tiwari was earlier appointed as Independent, Non-executive Director in the Board of
the Bank, on August 10, 2018. Mr. Arun Tiwari's directorship was reclassified as
Non-Executive, Non- Independent with effect from October 15, 2019.
The Shareholders had, at the Bank's 26th Annual General Meeting, held on September 25,
2020, approved the appointment of Mr. Arun Tiwari as Non-Executive, Non-Independent,
Part-time Chairman, for a period of three years with effect from January 31,2020.
(d) Managing Director & CEO
Mr. Sumant Kathpalia (DIN: 01054434) was appointed as Managing Director & CEO
of the Bank with effect from March 24, 2020.
The Shareholders had, at the Bank's 26th Annual General Meeting, held on September 25,
2020, approved the appointment of Mr. Sumant Kathpalia as Managing Director & CEO of
the Bank, for a period of three years with effect from March 24, 2020.
(e) Details of Directors seeking Appointment/Re-appointment/Directors retiring by
rotation at the forthcoming AGM
(i) Appointment
Mr. Jayant Deshmukh (DIN: 08697679) was appointed 'Additional Director' in the
category of Non-Executive, Independent Director in the Bank's Board on July 24, 2021.
Approval of the shareholders is being requested by the Board for the appointment of Mr.
Jayant Deshmukh as Non-Executive, Independent Director in the Board of the Bank by passing
of an Ordinary Resolution at the ensuing Annual General Meeting.
(ii) Re-appointment
None of the Directors of the Bank are liable for re-appointment at the ensuing AGM.
STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY, EXPERTISE AND
EXPERIENCE (INCLUDING THE PROFICIENCY) OF THE INDEPENDENT DIRECTORS APPOINTED DURING THE
YEAR:
The Bank did not appoint Independent Directors during the year 2020-21.
(iii) Retirement by Rotation
Section 152(6) of the Companies Act, 2013 provides that not less than two-thirds of the
total number of directors of a public company shall be liable to retire by rotation, and
that one-third of such directors shall retire from office at every Annual General Meeting
(AGM) of the Bank.
In accordance with the provisions of the Companies Act, 2013, Mr. Arun Tiwari (DIN:
05345547), Non-Executive, Non-Independent, Part-time Chairman of the Bank, shall be the
Director liable to retire by rotation.
Approval of the shareholders is requested by the Board for the re-appointment of Mr.
Arun Tiwari, who retires by rotation, and being eligible, offers himself for
re-appointment.
As required under Regulation 36(3) of the Listing Regulations, particulars of the
Directors retiring by rotation and seeking appointment, re-appointment on retirement by
rotation are given in the annexure to the Explanatory Statement attached to the Notice of
the AGM.
None of the Directors have been disqualified from being appointed as 'Director',
pursuant to Section 164 of the Companies Act, 2013 or under any other law.
The Board of Directors have received a Certificate from M/s. Bhandari & Associates,
Practicing Company Secretaries, pursuant to Regulation 34(3) read with Schedule V para C
clause 10 (i) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 that none of the Directors on the Board of the Bank have been debarred or
disqualified from being appointed or continuing as Directors on the Board by SEBI,
Ministry of Corporate Affairs or any other Statutory Authority.
(f) Cessation of Directorship
Mr. Sanjeev Kumar Asthana (DIN: 00048958) had resigned from the Bank's Board with
effect from the close of business hours on July 27, 2020, owing to acceptance of a new
role as the CEO of a corporate, impacting his being Director in the Bank's Board with
specialised knowledge/practical experience in Agriculture & Rural Economy, as laid
down in the Banking Regulation Act, 1949.
The Board of Directors wish to place on record their appreciation for the valuable
contributions made by Mr. Sanjeev Kumar Asthana in the deliberations in the Board meetings
during his tenure as Director of the Bank.
(g) Cessation of Director after the end of the year and upto the date of the Report
None of the Directors had demitted office after the end of the year and up to the date
of this Report.
Board and Committee Meetings
During the year, nineteen meetings of the Board of Directors and twelve meetings of the
Audit Committee of the Board were held, the details of which are given in the Corporate
Governance Report, which forms an integral part of this Report.
Mrs. Bhavna Doshi was appointed as Member of the Audit Committee with effect from May
9, 2020. As on March 31,2021, the constitution of the Audit Committee comprised, Mr.
Sanjay Asher as Chairman, Mr. Arun Tiwari, Mr. Shanker Annaswamy and Mrs. Bhavna Doshi, as
Members.
There have not been any instances during the year when recommendations of the Audit
Committee were not accepted by the Board.
Details of the composition of the Board and of all its Committees, the Meetings held
and attendance of the Directors at such Meetings are provided in the Corporate Governance
Report. The intervening gap between the Meetings was within the period prescribed under
the Companies Act, 2013 and the SEBI (LODR) Regulations.
Performance Evaluation of the Board
Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, the
Nomination & Remuneration Committee of the Board had laid down the criteria for
Performance Evaluation of the Board as a whole, Committees of the Board, Directors
individually, and of the Chairman, as well as the process of evaluation.
The Bank has aligned its Board Evaluation Framework in line with the Guidance Note on
Board Evaluation issued by SEBI as per Circular dated January 5, 2017.
The Board of Directors have, on the recommendation of the Nomination & Remuneration
Committee, engaged an external Independent Professional for conducting the Performance
Evaluation exercise.
The Board of Directors has carried out the annual evaluation of the performance of the
Board as a whole, Individual Directors including Independent Directors, Non-Independent
Directors, the Chairman and the Committees of the Board.
The performance of the Board as a whole, Committees of the Board, Directors
individually, and of the Chairman has been evaluated/reviewed by the Nomination &
Remuneration Committee, Committee of Independent Directors and by the Board of Directors.
The Board has formulated a Policy on Performance Evaluation which details the various
aspects that are to be considered for evaluating the Directors including but not limited
to attendance, participation in the meeting, contribution towards strategies of the Board,
etc.
The Policy provides guidelines for the individual Directors to evaluate the Board, its
Committees and individual directors.
The Policy on Performance Evaluation is available on the website of the Bank at:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
The Statement indicating the manner in which the evaluation exercise was conducted is
included in the Report on Corporate Governance, which forms an integral part of this
Annual Report.
Policy on Appointment and Selection of Directors
The Board of Directors are at the helm of the Bank and an enlightened Board creates a
culture of leadership and provides a long-term policy approach to improve the quality of
governance.
The Policy on Appointment & Selection of Directors has been framed in compliance
with Section 178 of the Companies Act, 2013, and other applicable regulations under SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 and Banking Regulation
Act, 1949.
The Policy shall act as a guideline for the Nomination & Remuneration Committee for
determining the qualifications, positive attributes, independence of Directors and matters
related thereto to recommend appointment and removal of Directors to the Board of the
Bank.
The Policy on Appointment & Selection of Directors is hosted on the website of the
Bank at: https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
Familiarization Programs for Independent Directors
Various programs were undertaken for familiarizing the Independent Directors of the
Bank, details of which are disclosed in the Corporate Governance Report, which forms part
of this Report.
Change in Key Managerial Personnel
During the financial year 2020-21, there was no change in Key Managerial Personnel.
System for Internal Financial Controls and its Adequacy
The Bank operates in a fully computerised environment with a Core Banking Solution,
supported by diverse application platforms for handling special businesses, such as
Treasury, Trade Finance, Credit Cards, Retail Loans, etc. The process of recording of
transactions in each of the application platforms is subject to various forms of controls
such as in-built system checks, Maker - Checker authorisations, independent
post-transaction reviews, etc. The Financial Statements are prepared based on computer
system outputs. The responsibility of preparation of Financial Statements is entrusted to
a dedicated unit which is completely independent. This unit does not originate accounting
entries except for limited matters such as, Share Capital, Taxes and Transfers to
Reserves. The Bank has implemented adequate procedures and internal controls which provide
reasonable assurance regarding reliability of financial reporting and preparation of
Financial Statements, and that such internal financial controls were adequate and were
operating effectively during the year.
Conservation of Energy and Technology Absorption and Foreign Exchange Earnings and
Outgo
The information on conservation of energy and technology absorption pursuant to Section
134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts)
Rules, 2014 is mentioned elsewhere in this Report. The other Statutory
Information/Disclosures required to be given under the Banking Regulation Act, 1949 and
the Companies Act, 2013, as applicable to the Bank, have been laid out in the
Schedules/Notes attached and forms part of the Balance Sheet and the Profit and Loss
Account.
Conservation of Energy:
Considering the nature of its activities as an entity in the Financial Services sector,
the Bank has voluntarily taken steps towards conservation of energy, details of which are
furnished in Principle 6 of Section E of the Business Responsibility Report.
Technology Absorption:
The Bank has made optimum use of Information Technology in its operations. Details
pertaining to Technology Absorption have been explained in the Management and Discussion
Analysis Report which forms an integral part of the Annual Report.
Foreign Exchange Earnings and Outgo:
The provisions relating to 134(3)(m) of the Companies Act, 2013, on particulars
relating to Foreign Exchange Earnings and Outgo are not applicable to a Banking company
and as such, no Disclosure is being made in this regard.
Risk Management
The Bank has an Enterprise-wide Risk Management (ERM) framework in place. The
integrated Risk Management Department covers Credit Risk, Market Risk, Assets-Liabilities
Management (ALM) and Operational Risk across all verticals, independent of business
functions.
Risk Management functions in the Bank have been aligned with industry best practices,
supported by advanced risk measurement and analytical systems which enable proactive risk
management and monitoring. Risk Management is continually enhanced in line with changes in
operating environment and regulations.
The Bank has a comprehensive framework of Risk Management Policies which specify the
risk appetite, risk measurement methodologies, and monitoring and control measures for the
respective business segments. The policies have been designed keeping risk appetite as the
central objective, and business strategies have been aligned to risk policies.
The Bank has set up a Board-level Committee, viz., 'Risk Management Committee' to
examine risk policies and procedures developed by the Bank and monitor adherence to risk
parameters and prudential limits set for different portfolios/products/ segments.
Details of Risk Management Models and Frameworks implemented by the Bank are mentioned
in the 'Management Discussion and Analysis Report'
Vigil Mechanism/Whistle Blower Policy
The Bank has in place the 'Whistle Blower Policy' since 2009.
The said Policy is in compliance with RBI Guidelines, provisions of the Companies Act,
2013, and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Vigil Mechanism at the Bank requires submission of Quarterly Reviews before the Audit
Committee of the Board, and placing of Annual Reviews before the Audit Committee and the
Board of Directors.
The Policy also incorporates suggestions of the Protected Disclosure Scheme for Private
Sector and Foreign Banks, instituted by Reserve Bank of India.
The Board of Directors of the Bank have constituted a Board-level Committee, viz., the
Vigilance Committee, which conducts overview of cases of vigilance nature arising out of
actions of the employees of the Bank. The Committee meets at least twice a year.
The Bank's Whistle Blower Policy is in synchrony with all statutory and regulatory
guidelines on Vigil Mechanism.
Further details about the Vigil Mechanism are furnished in the Report on Corporate
Governance, and the current Whistle Blower Policy of the Bank is available on the Bank's
website at the under-mentioned link:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html >
Policies & Codes >> Whistle Blower Policy
Reporting of Fraud, by the Auditors
During the year under review, there were no instances of fraud reported by the Auditors
pursuant to Section 143(12) of the Companies Act, 2013 to the Audit Committee or the Board
of Directors.
Statutory Auditors
M/s Haribhakti & Co. LLP, Chartered Accountants were appointed Statutory Auditors
in the 26th Annual General Meeting held on September 25, 2020 for a period of one year,
until the conclusion of the next Annual General Meeting. In accordance with extant
Guidelines, they are eligible to be reappointed for one more year, and accordingly, it is
proposed to reappoint M/s Haribhakti & Co. LLP, Chartered Accountants (ICAI Firm
Registration Number 103523W/W100048) as one of the Joint Statutory Auditors of the Bank
from the conclusion of this AGM until the conclusion of the next AGM.
Further, M/s M. P. Chitale & Co., Chartered Accountants (ICAI Firm Registration
Number 101851W) are proposed to be appointed as one of the Joint Statutory Auditors of the
Bank for a period of three years commencing from the conclusion of this AGM, until the
conclusion of the 30th Annual General Meeting that would be held during FY
2024-25, subject to the approval of the RBI on annual basis from the conclusion of the 28th
AGM.
Independent Auditors' Report
M/s Haribhakti & Co. LLP., Statutory Auditors of the Bank, have audited the
accounts of the Bank for the year 2020-21 and their Report is annexed. Pursuant to Section
143(3)(i) of the Companies Act, 2013, the Statutory Auditors have also reported on the
adequacy and operating effectiveness of internal financial controls system over financial
reporting, which has been enclosed as 'Annexure' to the Independent Auditors'
Report.
Significant Audit observations, if any, and corrective actions taken by the Management
are presented to the Audit Committee of the Board from time to time.
There are no qualifications, reservations or adverse remarks or disclaimers made in the
Auditors' Report.
Secretarial Audit
In terms of Section 204 of the Companies Act, 2013 and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Bank has appointed M/s Bhandari
& Associates, Company Secretaries in Practice, to undertake Secretarial Audit of the
Bank for FY 2020-21. The Secretarial Audit Report submitted by M/s Bhandari &
Associates is furnished at Annexure II, and forms an integral part of this Report.
The Secretarial Audit Report submitted by M/s Bhandari & Associates for FY 2020-21
does not contain any qualification, reservation or adverse remark.
Employees Stock Option Scheme
The Bank had instituted the Employees Stock Option Scheme (ESOS-2020) to enable its
employees, including Whole-time Directors, to participate in the future growth of the
Bank. Under the Scheme, Options can be granted, which upon exercise could give rise to the
issuance of a number of shares upto 7% of the issued Equity Capital of the Bank from time
to time. The eligibility and number of Options to be granted to an employee is determined
on the basis of criteria laid down in the Scheme and is approved by the Compensation
Committee of the Board of Directors.
Pursuant to a Composite Scheme of Arrangement with the erstwhile Bharat Financial
Inclusion Limited, the shareholders of the Bank approved the IBL Special Incentive ESOS
for BFIL Merger 2018 (ESOS 2018) on December 11,2018. ESOS 2018 was approved with a pool
of 57,50,000 options which are equity settled 50% of the options vest over a period of
three years from the grant date and the remaining options vest over a period of three
years from the first anniversary of the grant date. Upon vesting, the options have to be
exercised within a maximum period of five years.
As at March 31, 2021, the Compensation Committee of the Bank has granted a total of
5,10,15,642 Options that includes 4,57,27,836 options granted under ESOS 2020 and
52,87,806 options granted under ESOS 2018
Statutory disclosures as required by SEBI (Share Based Employee Benefits) Regulations,
2014 are given at Annexure III, and form an integral part of this Report.
The Annual Certificate on compliance with SEBI (Share Based Employee Benefits)
Regulations, 2014 issued by Statutory Auditors of the Bank shall be made available on the
website of the Bank, on the day of the AGM.
The Employees Stock Option Plan is administered by the Compensation Committee of the
Board.
Statutory disclosures as mandated under Regulation 14 of the SEBI (Share Based Employee
Benefits) Regulations, 2014, as amended, have been hosted on the website of the Bank at:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
Disclosure on compliance with Secretarial Standards
The Bank has complied with the provisions of all applicable Secretarial Standards
issued by the Institute of Company Secretaries of India and has systems which are adequate
and are operating effectively.
Maintenance of Cost Records
Being a Banking Company, the Bank is not required to maintain cost records as per sub-
section (1) of Section 148 of the Companies Act, 2013.
Other Disclosures
(i) Details of application made or any proceedings pending under the Insolvency and
Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end
of the financial year under review:
Pan No. |
Borrower |
Date of filing |
Date of admission |
Is the case filed under RBI direction |
Resolution status |
Remarks |
AAACC1921B |
Cox & Kings Ltd. - (Borrower) Cox and Kings Global Services Pvt Ltd. (Corporate
Guarantor) |
29.06.2020 |
|
No |
Yet to be admitted |
In the matter of Cox & Kings Limited (borrower), the Bank has filed an application
u/s 7 of IBC against the Corporate Guarantor - Cox & Kings Global Services Ltd. for
Principal Liability of Borrower on 29.06.2020 before Mumbai NCLT, which is pending for
admission. |
AAACG0108J |
Gallium Industries Ltd |
30.06.2017 |
21.07.2017 |
No |
Liquidation order passed |
The liquidation Order was passed on 1 7.1 2.201 8. The liquidator has sold all the
assets and distributed the amount to the stakeholders as per claims. The liquidator is in
the process of closure of all accounts and dissolution of the company. |
|
|
|
|
|
|
The matter is scheduled for hearing on August 26, 2021. |
Directors' Responsibility Statement
To the best of their knowledge and belief and according to the information and
explanations obtained by them, the Directors make the following statement in terms of
Section 134(3)(c) and 134(5) of the Companies Act, 2013:
(a) that in the preparation of the Annual Accounts for the year ended March 31,2021,
the applicable Accounting Standards have been followed along with proper explanation
relating to material departures, if any;
(b) that such accounting policies as mentioned in the Notes to the Financial Statements
have been selected and applied consistently and that judgments and estimates have been
made that are reasonable and prudent so as to give a true and fair view of the state of
affairs of the Bank as at March 31,2021 and of the profit of the Bank for the year ended
on that date;
(c) that proper and sufficient care has been taken for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of the Bank and for preventing and detecting frauds and other
irregularities;
(d) that the Annual Financial Statements have been prepared on a 'going concern' basis;
(e) that proper internal financial controls were in place and that the financial
controls were adequate and operating effectively; and
(f) that systems to ensure compliance with the provisions of all applicable laws were
in place and were adequate and operating effectively.
Annual Return
Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the
Annual Return of the Bank as on March 31,2021, in the prescribed Form MGT-7 is available
on the Bank's website at the link:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
Particulars of Employees
The Bank had 29,661 employees on its rolls as on March 31, 2021.
58 employees employed throughout the year were in receipt of remuneration of Rs.1.02
crore per annum or more, and 12 employees employed for the part of FY 2021 were in receipt
of remuneration of Rs.8.50 lakh per month or more.
The information containing particulars of employees pursuant to Section 197 of the
Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 forms part of this Report. However, the information is
not being sent along with this Annual Report to the Members of the Bank in line with the
provision of Section 136 of the Companies Act, 2013. Members who are interested in
obtaining the Annexure may please send an email to the Company Secretary at
investor@indusind.com.
None of the employees hold (by himself or along with his spouse and dependent children)
more than two percent of the Equity Shares of the Bank.
Details pursuant to remuneration of Directors and Employees in terms of Section 197(12)
of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 including the Companies (Appointment and
Remuneration of Managerial Personnel) Amendment Rules, 2016, are given at Annexure IV and
form an integral part of this Report.
Policy on Remuneration to Non-Executive Directors
In line with the guidelines contained in RBI Circular dated June 1,2015 on compensation
of Non-Executive Directors of private sector banks, and the approval of the Board of
Directors, of the Shareholders and of the Reserve Bank of India, wherever applicable,
remuneration of Rs.10 lakhs per annum was paid to Non-Executive Directors in the form of
Profit-related Commission in addition to Sitting Fees paid for attending meetings of the
Board and of various Board Committees.
In line with the guidelines contained in the above-referred RBI Circular, Mr. Arun
Tiwari, Non-Independent, Non-Executive, Parttime Chairman of the Bank is paid remuneration
of Rs.30 lakhs per annum, as approved by the Nomination & Remuneration Committee of
the Board, the Board of Directors and by the Reserve Bank of India.
The annual remuneration payable to a single Non-Executive Director does not exceed 50%
of the total annual remuneration payable to all Non-Executive Directors.
No Stock Options were granted to the Non-Executive Directors.
The 'Policy on Remuneration to Non-Executive Directors' is hosted on the Bank's website
at the link given below:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
Details on compensation to Whole-time Directors are given under the Report on Corporate
Governance, which forms an integral part of this Report.
RBI, vide its Circular dated April 26, 2021 has permitted for higher payment of
compensation to Non-Executive Directors (NEDs) in the form of a fixed remuneration
commensurate with an individual Director's responsibilities and demands on time and which
are considered sufficient to attract qualified competent individuals, subject to maximum
of Rs.20,00,000 per annum.
A proposal for payment of compensation to each Non-Executive Director [excluding the
Non-Executive (Part-time) Chairperson] of the Bank, by way of fixed remuneration not
exceeding Rupees Rs.20,00,000/- (Rupees Twenty Lakhs) per annum, with effect from the
Financial Year 2021-2022, is being placed for approval of the Shareholders at the ensuing
AGM.
Particulars of Loans, Guarantees or Investments outstanding
Pursuant to Section 186(11) of the Companies Act, 2013, loans made, guarantees given,
securities provided or acquisition of securities by a banking company in the ordinary
course of its business are exempted from the disclosure requirement under Section
134(3)(g) of the Companies Act, 2013.
Particulars of Contracts or Arrangements with Related Parties
All transactions entered with 'Related Parties' during the year under review were on
'arm's length basis' and in the 'ordinary course of business' and therefore do not attract
the provisions of Section 188 of the Companies Act, 2013.
Further, there are no materially significant Related Party Transactions during the year
with any of the Related Parties, viz., Promoters, Directors and Key Management Personnel,
Subsidiary and other related entities including IMFS, an Associate Company, which may have
potential conflict with the interest of the Bank at large.
In view of the above, the disclosure under Form AOC-2 is not applicable to the Bank.
The Policy on Related Party Transactions as approved by the Board of Directors is
hosted on the Bank's website at the below given link:
https://www.indusind.com/in/en/investors/investor-landing/investor-resources.html
>>Policies & Codes >> Related Party Transaction Policy
Consolidated Financial Statements
In accordance with Section 129(3) of the Act, Consolidated Financial Statement of
IndusInd Bank Limited ('the Bank'), Bharat Financial Inclusion Limited (formerly known as
IndusInd Financial Inclusion Limited) (BFIL) ("the Subsidiary") and IndusInd
Marketing and Financial Services Private Limited (IMFS) ("the Associate") has
been prepared and is included in the Annual Report.
In the preparation of the Consolidated Financial Statement, the Standalone Financial
Statements of BFIL, the wholly-owned subsidiary, for the year ended March 31,2021, have
been considered on a line by line basis by adding together like items of assets,
liabilities, income and expenses, in accordance with AS 21.
In accordance with AS 23, the Standalone Financial Statements of IMFS, an associate in
which the Bank has a 30% stake, has been considered in the Consolidated Financial
Statement by adopting 'Equity Method'.
Indian Accounting Standards (Ind AS)
The Reserve Bank of India (RBI) issued a circular in February 2016, requiring Scheduled
Commercial Banks to implement Indian Accounting Standards (Ind AS) from April 1,2018. Vide
a press release dated April 5, 2018 the implementation was deferred by one year. The
legislative amendments recommended by the Reserve Bank towards implementation of Ind AS
are still under consideration of the Government of India. Accordingly, RBI had, through a
notification dated March 22, 2019, deferred the Ind AS implementation until further
notice.
Pursuant to the RBI Circular dated February 11,2016, the Bank formed a Steering
Committee, comprising members from crossfunctional areas, for the purpose of reviewing and
monitoring the progress of implementation. The Bank had set up a Working Group under the
guidance of the Steering Committee and has conducted Gap Assessment and identified the
differences between the current accounting framework and Ind AS, including the
identification of the accounting policy options provided under Ind AS 101, First Time
Adoption. The Bank had engaged the services of a professional firm with international
experience in the field, to assist in the project of implementation of Ind AS. The Bank
has obtained licenses for IT systems to automate Expected Credit Losses and Effective
Interest Rate calculations towards implementation of Ind AS and the project is currently
under implementation. The Bank continues to organize trainings for its teams across
business and support functions. The Audit Committee of the Board of Directors has an
oversight on the progress of the Ind AS implementation. Further, there may be regulatory
guidelines and/or clarifications in some of the critical areas with respect to application
of Ind AS, which the Bank will need to incorporate in its implementation project as and
when those are issued.
In accordance with RBI directions, the Bank has been submitting standalone pro forma
Ind- AS financial statements along with other computations to the RBI, from time to time.
Corporate Social Responsibility
In line with its CSR focus areas, the Bank is committed to various long term community
development projects that have a large positive impact. Consistent with the requirements
of Section 135 of the Companies Act, 2013 and CSR Rules 2014, the Bank has set up a
Board-level CSR Committee to look after the CSR initiatives. The Committee is headed by
Mrs. Akila Krishnakumar as the Chairperson, and Mr. Rajiv Agarwal, Mr. Sanjay Asher and
Mr. Sumant Kathpalia are the Members.
The composition of the CSR Committee is in accordance with Section 135 of the Companies
Act, 2013. The Board at its meeting held on April 7, 2020, approved the integration of
sustainability function with the CSR function in CSR Committee and the Committee was
renamed as 'Corporate Social Responsibility & Sustainability Committee'
The Bank's CSR Policy and strategy direct and govern the Bank's activities in focus
areas, namely, Environmental Sustainability, Healthcare, Education, Sports,
Skills/Livelihood Development and other areas.
In FY 2020-21 the Bank continued its flagship initiative under the water stewardship
wherein it undertook water resource development and management through watershed and
springshed management, restoration of water bodies like lakes, ponds, tanks, roof rain
water harvesting by reviving traditional structures, harvesting of river water and
availability and accessibility of safe drinking water through installation of water ATMs.
The Bank also extended projects towards environmental sustainability like Urban
afforestation, Renewable energy solutions and Waste management.
Under the theme Education, the Bank implemented Academic Improvement Programs in
government schools viz., Road to school, Early Language learning which is expected to
change the way in which education is delivered. Education centers of Assisted Learning
Program helps children cope with their learning gaps and pass the 10th grade. To encourage
excellence, the Bank also provides Scholarship support for higher education like
engineering, school education and for deserving Young India Fellows.
IndusInd Bank supported inclusiveness of the differently-abled alongwith gender
inclusiveness/equality in Sports. The Bank had a separate non-business vertical for Sports
which undertook spreading the culture of inclusivity and excellence in sports within and
outside the organisation. Currently five excellence programmes namely, IndusInd Para
Champions, IndusInd Blind Cricket, IndusInd Girl Power, IndusInd Hockey for her Excellence
& Nurturing Rural Champions are being supported.
Under the focus area of Healthcare, IndusInd Bank supported an intervention on reducing
cancer burden by providing care, treatment, awareness and prevention services with supply
of radiology equipment. The Bank also supports the treatment of children with cancer in
Rajasthan, Maharashtra and Goa. IndusInd Bank has set up e-Health Clinics, Mobile Medical
Units, etc., to provide affordable primary healthcare to individuals from poor and lower
Income Group families. 2 special programs on Mother and Child care and Adolescent Girls
Menstrual Health were also rolled out this year.
To promote livelihood, the Bank supports skill development of disabled from
marginalized communities in various districts of Karnataka. Similarly, youth from Assam
and Rajasthan are trained for an employable skill and placed. The Bank supports long term
residential rehabilitation program including skill training for substance abusing street
children/ youth. A program on livestock development is also newly launched.
The Bank has continued CSR initiatives of Bharat Financial Inclusion Limited, its
wholly- owned subsidiary. Two flagship initiatives, viz., Bharat Sanjeevani (on livestock
care) and Pragat (Integrated Development Program including Water, Healthcare and
Education) are supported.
In response to COVID, the Bank carried out several activities ranging from distribution
of essential supplies to poor families, medical supplies/equipment for health workers and
hospitals to contribution to State and Central Government Disaster Relief Funds, etc.
The CSR Initiatives/Projects undertaken by the Bank are in accordance with Schedule VII
of the Companies Act, 2013.
Companies, on the basis of criteria prescribed under Section 135 of the Act, are
required to spend at least Two per cent of their Average Net Profits made during the three
immediately preceding financial years, in pursuance of their Corporate Social
Responsibility Policy. Accordingly, the Bank spent Rs.94.72 crores towards various CSR
activities specified in Schedule VII of the Companies Act, 2013. Rs.26 crores are
earmarked on several ongoing projects whose expenditure was delayed due to COVID and will
be spent in the subsequent year totaling to Rs.120.72 crores.
The Report on CSR activities undertaken by the Bank is set out at Annexure V and
forms an integral part of this Report.
The CSR Policy, amended during the year, is framed basis the activities permitted under
Schedule VII of the Companies Act, 2013. Details of the CSR Policy and initiatives adopted
by the Bank on CSR are available on Bank's website at the link given below:
https://www.indusind.com/in/en/csr-home/our-approach/csr-policy.html
Sustainability
In its endeavor to incorporate sustainability in to business, the Bank is diligently
setting up processes that reflect its long standing view - "Good Ecology is Good
Economics". The Bank recognizes the fact that aligning its products, services and
operations with its ESG strategy contributes towards betterment of the environment and
society at large and also presents a good business case. The sustainability policy of the
Bank lays out guidelines and targets in key areas of the environmental, social, economic
and governance aspects. The Bank has committed targets on Environmental, Social and
Governance (ESG) aspects and continues to improve the sustainability performance to
surpass the ESG targets.
As a socially and environmentally responsible organization, the Bank seeks to
specialize the lending portfolio by increasing investments in development sectors and
integration of ESG aspects in corporate and consumer banking. The Bank has strengthened
financial Inclusion with initiatives like livelihood financing, microfinance, vehicle
financing for livelihood and agribusiness. The Bank keeps abreast with latest research on
corporate citizenship and responsible banking both globally and locally. The Bank has
adopted various reporting platforms and guidance frameworks laid out by 'Standard Setters'
such as, International Integrated Reporting Council (IIRC), Global Reporting Initiative
(GRI), Carbon Disclosure Project (CDP), Dow Jones Sustainability Index (DJSI), etc., for
assessment and accountability in sustainability performance.
The Bank is determined to mitigate climate change impact which is evidenced through
committing long term targets and deploying climate strategy to invest in energy efficiency
projects and greening the IT systems. The Bank promotes sustainable and ethical
procurement practices through selection and on-boarding criteria on ESG compliance for
vendors and suppliers. The Bank has demonstrated accountability and transparency through
disclosure on materiality analysis, ethical business practices, cyber-security strategy
and data privacy management.
This comprehensive sustainability approach has helped IndusInd Bank's inclusion in the
S&P Dow Jones Sustainability Yearbook 2021, which showcases that the Bank clearly
looks beyond profits to focus on its people, the society and the planet.
Business Responsibility Report (BRR)
The Securities & Exchange Board of India have, with effect from December 26, 2019,
vide SEBI (Listing Obligations and Disclosure Requirements) (Fifth Amendment) Regulations,
2019, mandated the top 1,000 listed entities to include the 'Business Responsibility
Report' (BRR) as part of the Annual Report, describing the initiatives taken by the listed
entity from an environmental, social and governance perspective, in the format as
specified by SEBI.
In view of the above and in compliance with Regulation 34(2) of the Listing
Regulations, BRR has been hosted on the Bank's website at the link below:
https://www.indusind.com/in/en/sustainability.html
Corporate Governance
Corporate Governance is essentially a set of standards, systems, and procedures aimed
at effective, honest, transparent, and responsible management of a company within the
applicable statutory and regulatory structures.
The Bank has adopted the industry best practices of Corporate Governance and aims to
continue banking on the highest principles of governance and ethics. At IndusInd,
Corporate Governance is more than just adherence to the statutory and regulatory
requirements. It is equally about focusing on voluntary practices that underlie the
highest levels of transparency.
The Governance framework is driven by the objective of enhancing long-term stakeholder
value, without compromising on Ethical Standards and Corporate Social Responsibilities.
The Bank's guiding principles are also articulated through its Code of Business Conduct
and various initiatives taken to maintain transparency by communicating with the
Shareholders on developments in the Bank. The Bank has also set up various subcommittees
of the Board to bring in more efficacy and transparency in the workings.
The Bank continues to focus on better, complete and timely disclosures to the Stock
Exchanges for dissemination to the Stakeholders. Detailed disclosures regarding corporate
governance are provided in the Corporate Governance Report, which forms an integral part
of this Annual Report.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report, as prescribed under Regulation 34(2)(e)
of the SEBI (LODR) Regulations, forms part of this Annual Report.
Significant and Material Orders passed by the Regulators or Courts
There were no significant and material Orders passed by the Regulators/Courts that
would impact the 'going concern' status of the Bank and its future operations.
Material Events that have happened after the Balance Sheet date
No material changes and commitments affecting the financial position of the Bank have
occurred between the end of the financial year of the Bank to which the Financial
Statements relate and the date of this Report. For the impact of Covid-19 on the
performance of the Bank and the Group, refer "Note No. 5.13 of Schedule 18 - Notes
forming part of the accounts" of financial statements of the Bank and "Note No.
12 of Schedule 18 - Notes forming part of the accounts" of consolidated financial
statements of the Bank.
Awards and Accolades
IndusInd Bank was recognized for its excellence through a number of awards and
accolades, across a range of categories. The Bank started off its winning streak with 2
awards at the Finacle Innovations Awards 2020 for technology implementations - Product
Innovation and Transformation Excellence. The Bank was awarded with the Infosys Finacle
Client Innovations Awards 2020 for Alexa and Chatbot Implementations.
The Bank ended Q1 on a high note, with the Best Financier Award 2019 at the JCB India
Annual Financiers' Award 2019, along with being ranked 2nd in the Ashok Leyland Product
Funding during the year 2020 at Annual Financier Award 2020 from Ashok Leyland.
The Bank was awarded 'Outstanding Response to COVID-19, Branchless Banking' in Global
Retail Banking Innovation Awards 2020 - The Digital Banker.
The Bank was bestowed Silver Category in 'Best Mobile Search Campaign' in 11th
India Digital Awards - Internet and Mobile Association of India.
The Bank was honoured with the 2020 APAC Innovation Award - Red Hat.
The Bank was also honoured with 'Most Innovative Company'for Multi-cloud platform in
Business Impact Awards 2020 - Economic Times and vmware.
The Bank was also bestowed with two awards at the CSR Times Awards 2020-21, for the
Bank's efforts in 'Rainwater Harvesting' in Rajasthan and 'Road To School' Programme in
Odisha.
In the fourth quarter, the Bank was featured in the Carbon Disclosure Project (CDP)
list for the 6th Consecutive year - the only Bank in India with this honour. Some other
honours the Bank was bestowed with in this quarter include, Indus OnTheGo Mobile LOS at
Banking Frontiers FINNOVITI Awards 2021 and an inclusion in the S&P DJSI
Sustainability Yearbook.
Cautionary Statement
Certain statements in the Directors' Report and in the Management Discussion and
Analysis document describing the Bank's objectives, estimates and expectations may be
'forward-looking statements' within the meaning of applicable Securities Laws and
Regulations. Actual results could differ substantially from those expressed or implied.
Important factors that could make a difference include economic conditions in the domestic
and overseas markets, changes in Laws/Regulations, and other incidental factors.
Policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace
The Bank has complied with provisions relating to the constitution of Internal
Complaints Committees under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
The disclosures relating to the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013, is included in the Corporate Governance Report,
which forms an integral part of this Report.
Acknowledgements
The Directors are grateful to the Shareholders for the trust and confidence reposed by
them in the Bank.
The Directors are also grateful to the Reserve Bank of India, the Ministry of Corporate
Affairs, Securities and Exchange Board of India, Insurance Regulatory and Development
Authority, and the Stock Exchanges, for the guidance and support extended by them to the
Bank.
The Board thanks its valued Customers for their patronage, and looks forward to the
growing of this mutually supportive relationship in future.
The Board expresses its deep sense of appreciation to all employees for their excellent
performance, strong work ethic, and untiring commitment, which qualities have contributed
to the Bank's continued progress in a challenging environment.
|
For and on behalf of the Board of Directors |
|
Sd/- |
Place: Mumbai |
Arun Tiwari |
Date: July 24, 2021 |
Chairman |
|
DIN: 05345547 |