South Indian Bank Ltd

Dear Shareholders,

It gives me immense pleasure and responsibility to share with you the Annual Report of South Indian Bank for the fiscal year 2024-25. This year, we made progress with steady resolve and a deep commitment to transformation. Our journey reflects a blend of tradition and innovation, underscored by the trust placed in us by customers, investors, and communities across India. As the banking landscape undergoes sweeping changes driven by digitalisation and changing customer preferences, the Bank has continued to build on our legacy of reliability while preparing for a future of sustained performance and growth. We remain committed to responsible banking and creating long-term stakeholder value.

FY 24-25 marked a pivotal year in our transformation journey, as South Indian Bank reported its highest-ever net profit of Rs1,303 crore, reflecting a robust 22% growth over the previous

& year. Improved operating metrics, cost efficiencies, and a disciplined approach to credit underwriting drove this performance. Our total business expanded to Rs1,95,104 crore, with total advances reaching Rs87,579 crore, and total deposits rising to Rs1,07,526 crore. Net Interest Income (Nil) stood at Rs3,486 crore, supported by focused asset mix changes and digital origination tools. These results underscore the growing trust of customers and the

Over the past year, the Bank has strengthened its institutional resilience through targeted growth, strategic digital initiatives, and enhanced governance processes. Bank's asset quality has witnessed a notable improvement, with GNPA declining to 3.20% and NNPA to 0.92%, while our Provision Coverage Ratio (PCR including writeoff) has increased to 85.03%, highlighting prudent provisioning and early stress identification. The

Bank also has streamlined internal operations and empowered customer-facing teams through training and incentive programs, thereby enhancing productivity and the quality of customer service. Despite external pressures from high interest rates and competitive dynamics, we continued to make progress in expanding our retail and MSME book, driven by core banking strength.

The Financial Year 2024-25 unfolded against the backdrop of global economic moderation and persistent geopolitical uncertainties. Yet, India retained its position as the world's fastest-growing major economy, with real GDP expanding at a rate of 6.50%. This growth was anchored in substantial public sector investment, robust consumption, and a resilient service sector. Within the Indian banking industry, Scheduled Commercial Banks recorded a 12.10% credit growth, driven by the Personal Loans and MSME segments—areas that closely align with South Indian Bank's strategic focus. Despite funding pressures and a tightening interest rate environment, asset quality improved across the system, and banks demonstrated robust capital positions and operational resilience.

Amid rising competition from capital markets, mutual funds, and fintech lenders, the sector remains focused on enhancing digital capabilities, improving customer experience, and sustaining credit quality. For banks like ours, these dynamics underline the need to remain nimble, digitally agile, and customercentric, while maintaining prudence in asset-liability management. As we enter FY25-26, South Indian Bank remains committed to responsible growth, supporting priority sectors, expanding our footprint across India, and making meaningful contributions to financial inclusion and the broader economic recovery.

The Capital Adequacy Ratio (CRAR) of the Bank was 19.31% under Basel III norms as on March 31,

2025 and Tier I capital at 17.98%, both well above the RBI mandated thresholds of 11.50% and 9.50% respectively. The Bank's risk governance framework is built on proactive identification, monitoring, and mitigation across credit, market, and operational risks. Continued enhancements to our fraud detection systems, credit scoring models, and internal audit architecture have further reinforced institutional risk controls. The Bank remains committed to safeguarding capital while pursuing balanced, risk-calibrated growth across sectors and geographies.

Over the past year, the Bankhasstrengthenedits kin^J institutional resilience through targetedgrowth,strategic digital initiatives, and enhanced governanceprocesses.Bank'sj asset quality has witnessed a notableimprovement,withGNPA* a declining to 3.20% and NNPA to0.92%,while ourprovision coverage ratio (including written off)hasincreased to85.03%,' ketS highlighting prudent provisioning and earlystressidentification. the

During the FY 2024-25, the total gross business of the Bank increased from '1,82,346.52 crore to '1,95,104.12 crore; deposits increased from '1,01,920.26 crore to '1,07,525.60 crore; and gross advances increased from '80,426.26 crore to '87,578.52 crore. Operating profit of the Bank had increased to '2,270.08 crore in FY 2024-25 from '1,867.67croreinFY2023-24.TheNetProfit increased to '1,302.88 crore in FY 2024-25 as against '1,070.08 crore reported in 2023-24.

The Provision Coverage Ratio (PCR including write-off) has improved to 85.03% in FY 2024-25 from previous level of 79.10% in FY 2023-24. The Board has recommended a dividend of 40% i.e. @ '0.40 per equity share of face value of '1/-each, which is subject to the approval of shareholders in the ensuing Annual General Meeting.

The digital transformation t initiativesofthe Bank CMP have led to more than M 98%oftotaltransactions^ Ht being conducted digitally drivenbyenhancements*in mobile banking, internet I n banking,andplatforml partnerships. Initiatives such C asDebitCardEMI,digital\pC insurance bundling, and UPI integrationscontributedtol P enhanced user experiences. These technological advancements not only empowered customers but also improved internal efficiency and productivity across our branch network.

The Gross NPA to Gross Advances stood at 3.20% and the Net NPA to Net Advances stood at 0.92% as on March 31, 2025. The CASA has grown from '32,692.67 crore as on March 31,

2024 to '33,729.72 crore as on March 31, 2025, with a growth of 3.17% on a year on year basis. Net Interest Income of the Bank has increased from '3,332 Crore in FY 2023-24 to '3,486 crore in FY 2024-25. The Book value per share has increased from '33.73 as on March 31, 2024 to '38.60 as on March 31, 2025. Return on Assets (RoA) improved to 1.05% and Return on Equity (RoE) rose to 12.90%. Strong growth in retail assets, particularly in Home Loans and Auto Loans, complemented steady growth in Gold Loans. These outcomes demonstrate our balanced approach to growth and profitability.

We continued our focus on building frictionless, digitally enabled processes across all banking functions. FY 24-25 saw the launch of multiple automated Straight Through Processing (STP) flows, including Edu Power, Aawas Power, LAP Power, and GST Power, enabling faster turnaround in MSME and retail loan approvals. The digital transformation initiatives of the Bank have led to more than 98% of total transactions being conducted digitally driven by enhancements in mobile banking, internet banking, and platform partnerships. Initiatives such as Debit Card EMI, digital insurance bundling, and UPI integrations contributed to enhanced user experiences. These technological advancements not only empowered customers but also improved internal efficiency and productivity across our branch network.

The Bank's commitment to Environmental, Social and Governance (ESG) principles stands as a cornerstone of its operational ethos.

FY 24-25 saw continued progress in implementing our Green Deposit policy and offering sustainable financing options aligned with environmental objectives. Bank's CSR initiatives focused on education, healthcare, skill development, and livelihood enhancement for underserved communities. With sustainability forming a core component of long-term strategy, the Bank is committed to playing a constructive role in driving inclusive and green growth. We view ESG not just as compliance, but as a value enabler.

We approach FY 25-26 with a sharper focus on accelerating retail and MSME growth, deepening digital distribution, and enhancing customer experience. Our target is to achieve double-digit deposit and advance growth, while maintaining healthy asset quality. Tools developed over the past 18 months—including improved STP flows, digital lead engines, and frontline empowerment— are now enabling superior customer acquisition and servicing. The evolving interest rate environment and competitive pressures will be navigated through a prudent mix of growth, margin management, and cost efficiency. We remain confident that the Bank is well-positioned for sustained progress and responsible value creation.

I am associated with the Bank as a Director since 2018 and later on took charge as Chairman and I am exhilarated to deliver my responsibilities as Chairman of the Bank since November, 2023.

It has been a real privilege to associate with a legacy Bank, which is having a history of handling even Pre-Independence financial environment of the country since 1929. My heart is filled with bitter-sweet emotions. It is with a mixture of immense pride and a tinge of melancholy that I address you for the last time as the Chairman of this extraordinary Bank.

The Bank has witnessed both triumphs and tribulations, riding the unpredictable waves of the financial world, all the while holding steadfast to our unwavering vision. We have experienced the ecstasy of success and the depths of despair. We weathered storms that tested our resilience, but, my fellow shareholders, it is with immense joy and

a profound sense of accomplishment that I write to you today to proclaim that we have emerged triumphant.

Further, I extend my heartfelt gratitude to our valued shareholders, for the unconditional support and commitment. I would like to conclude by thanking all our customers, associates, partners, vendors, auditors and well-wishers for their continued support and trust. I wish to express my gratitude to the RBI, the SEBI, Stock Exchanges and Central and State Governments for their guidance in statutory compliances. I also thank the employees at all levels, for their tireless effort and teamwork. Finally, I would like to thank all our Board members and Management for their contribution in Bank's growth over the years. Together, we have navigated challenges and achieved milestones, reinforcing the Bank's position as a pillar of trust and innovation in the financial sector. As we move forward, we reaffirm our dedication to building a more agile, inclusive, and resilient South Indian Bank—one that creates enduring value for all stakeholders in the years to come.