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BANK OF MAHARASHTRA

14 July 2025 | 03:19

Industry >> Finance - Banks - Public Sector

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ISIN No INE457A01014 BSE Code / NSE Code 532525 / MAHABANK Book Value (Rs.) 34.86 Face Value 10.00
Bookclosure 09/05/2025 52Week High 71 EPS 7.21 P/E 7.78
Market Cap. 43126.55 Cr. 52Week Low 42 P/BV / Div Yield (%) 1.61 / 2.68 Market Lot 1.00
Security Type Other

NOTES TO ACCOUNTS

You can view the entire text of Notes to accounts of the company for the latest year
Year End :2025-03 

Data is presented as simple averages of daily observations over the previous quarter (i.e. the average is calculated over a period of 90 days). The simple average are calculated on daily observations over the previous quarters. The un-weighted value of inflows and outflows are calculated as the outstanding balances of various categories or types of liabilities, off balance sheet items or contractual receivables. The weighted value of HQLA are calculated as the value after haircuts are applied. The weighted value for inflows and outflows are calculated as the value after the inflow and outflow rates are applied. Total HQLA and total net cash outflows are disclosed as the adjusted value, where the adjusted value of HQLA is the value of total HQLA after the application of both haircuts and any applicable caps on Level 2B and Level 2 assets as indicated in this Framework. The adjusted value of net cash outflows is calculated after the cap on inflows is applied, if applicable.

Qualitative Disclosure:

From 01st January 2015, the bank has implemented guidelines on Liquidity Coverage Ratio (LCR) of the RBI.

The Liquidity Coverage Ratio (LCR) aims to ensure that a bank has an adequate stock of unencumbered High-Quality Liquid Assets (HQLA) that can be converted into cash easily and immediately to meet its liquidity needs for a 30 calendar day liquidity stress scenario.

The LCR is calculated by dividing the amount of High Quality Liquid Unencumbered Assets (HQLA) by the estimated net cash outflows over a stressed 30 calendar day period.

The net cash outflows are calculated by applying RBI prescribed outflow factors to the various categories of liabilities (deposits, unsecured and secured wholesale borrowings), as well as to undrawn commitments and derivative-related exposures, netted by inflows from assets maturing within 30 days. Average LCR on a daily basis for the quarter ended 31st March 2025 is 113.77%, above RBI prescribed minimum requirement of 100%.

i) Main drivers of LCR:

The Bank on a consolidated basis, during the three months ended 31st March 2025, had maintained average HQLA (after haircut) of ?69804.18 Crore. The HQLA is primarily driven by Government securities in excess of minimum SLR, Government securities within mandatory SLR requirement, to the extent allowed by RBI under MSF and the facility to avail liquidity for Liquidity coverage ratio. Also, cash, excess CRR maintained with RBI are important factors for Level 1 HQLA.

Level 2 HQLAs primarily consisted of BBB- and above rated corporate bonds and commercial papers not issued by financial entities.

ii) Changes over time:

LCR (Annual Average) has decreased from 138.18% for year end March 2024 to 113.63% for year end March 2025 mainly due to more increase in net cash outflow as compared to increase in HQLAs. HQLAs have increased on account of increase in SLR portfolio as compared to increase in statutory reserve ratios (SLR/CRR) on account of increase in NDTL.

• Level 2 assets which are lower in quality as compared to Level 1 assets, constitute 1.63% of total stock of HQLA against maximum mandated level of 40%.

iv) Concentration of funding sources:

A significant counterparty is defined as a single counterparty or group of connected or affiliated counterparties accounting in aggregate for more than 1% of the bank's total liabilities.

As on 31.03.2025, there are 4 significant counterparty deposit with sum of ? 21733.51 Crore i.e. 5.92% of total liabilities.

There is only 1 significant borrowing as on 31.03.2025 with an amount of ? 11927.92 Crore i.e. 3.25% of total liabilities.

Top 20 depositors of the Bank constitute 14.67% of our total deposits which is well within limit of 15% as per ALM Policy.

Top 10 borrowings of the bank constitute 82.01% of total borrowings.

A significant instrument/product is defined as a single instrument/ product of group of similar instruments/products which in aggregate amount to more than 1% of the bank's total liabilities. Example of funding instruments/products- wholesale deposits, certificate of deposits, long term bonds etc. Significant instrument/product as of 31st March 2025 were bulk deposits i.e. 13.21% of total liabilities, Retail term deposits i.e. 25.86% of total liabilities, Demand deposits i.e. 44.57% of total liabilities.

v) Derivative exposures and potential collateral calls:

Derivative exposure is shown as Net Derivative cash inflows within 30 days. Inflows from derivative exposure arose due to maturing forwards.

vi) Currency mismatch in the LCR;

As per the RBI guidelines while the LCR standard is required to be met on one single currency, in order to better capture potential currency mismatch the LCR in each currency needs to be monitored. Accordingly, Bank is maintaining LCR on daily basis in INR and the same is compared against the regulatory requirement. Further bank does not have exposure to any other significant currencies*, hence LCR is prepared for INR currency.

(*A significant currency is one where aggregate liabilities denominated in the currency amount to 5% or more of the bank's total liabilities).

vii) A description of the degree of centralization of liquidity management and interaction between the group's units:

The liquidity management for the bank on enterprise wide basis is the responsibility of the Board of Directors. Board of Directors has delegated its responsibilities to a Committee of the Board called as the "Risk Management Committee of Board". The committee is responsible for overseeing the inter linkages between different types of risk and its impact on liquidity.

Bank has ALM policy which provides the broad guidelines under which all the entities within the group operate in terms of liquidity and interest rate risk.

LCR is computed and monitored on daily basis by the Bank and the same is shared with Treasury/Midoffice for liquidity management and discussed in Investment committee.

Further LCR for the latest month along with comparison of previous months is placed before ALCO on monthly basis. Moreover, LCR position along with other liquidity parameters is placed before RMC/Board on quarterly basis.

viii) The inflows and outflows in the LCR calculation that are not captured in the LCR common template but which the institution considers to be relevant for its liquidity profile are as under:

Qualitative Disclosure around NSFR:

Guidelines on NSFR has become effective from 01.10.2021. Accordingly, bank has published its first disclosure regarding NSFR for quarter ended 31.12.2021.

The objective of NSFR is to ensure that bank maintains a stable funding profile in relation to the composition of its assets and off-balance sheet activities. A sustainable funding structure is intended to reduce the probability of erosion of a bank's liquidity position due to disruptions in a bank's regular sources of funding that would increase the risk of its failure and potentially lead to broader systemic stress. The NSFR limits overreliance on short-term wholesale funding, encourages better assessment of funding risk across all on-and off-balance sheet items, and promotes funding stability.

The NSFR is defined as the amount of available stable funding relative to the amount of required stable funding. "Available stable funding" (ASF) is defined as the portion of capital and liabilities expected to be reliable over the time horizon considered by the NSFR, which extends to one year. The amount of stable funding required ("Required stable funding") (RSF) of Bank is a function of the liquidity characteristics and residual maturities of the various assets held by Bank as well as those of its off-balance sheet (OBS) exposures.

Main drivers of NSFR:

The Bank as on 31st March 2025, had maintained ASF of ? 237503.77 crore ASF consists of 53% from less stable non-maturity deposits and term deposits with residual maturity of less than one year provided by retail and small business customers and 6.50% from Stable non-maturity (demand) deposits and term deposits with residual maturity of less than one year provided by retail and small business customers.

NSFR for the quarter ended 31st March 2025 is 131.94%, above RBI prescribed minimum requirement of 100%.

i. In accordance with the As-10 "Property, Plant and Equipment" depreciation of ? 29.46 Crore (? 29.49 Crore) for the year on revalued portion of fixed assets has been charged to Profit and Loss Account. Equivalent amount of ? 29.46 crore (? 29.49 Crore) has been transferred from Revaluation Reserve to Revenue Reserve.

ii. Certain premises of banks are stated at revalued amount. The gross amount of such revaluation included in premises at the end of the year is ? 1894.25 Crore.

iii. There are cases pending for leased premises where no contingent liability is recognized as the Bank is defending all these cases filed by landlords of Branch premises due to expiration of lease deeds. Out of these, Bank accounts for its liability to around ? 1.05 crore. In all other cases where landlords have filed the claims, the amount cannot be ascertained unless the court crystalizes quantum of claims.

iv. Capital work in progress comprises of the cost of fixed assets that are not yet ready for their intended use at the reporting date. Capital work in progress amounting to ? 4.25 Crore (? 9.58 Crore) includes construction of building.

The Bank has complied with the Accounting Standards issued by The Institute of Chartered Accountants of India (ICAI) to the extent applicable as under:

Accounting Standard 3- Cash Flow Statement: The bank prepares cash flow statement in line with requirements of AS-3 using indirect method.

Accounting Standard 4- Contingencies and Events Occurring After the Balance Sheet Date: Central Government vide Gazette Notification No. CG-DL-E-07042025-262329 dated 07.04.2025 notified amalgamation of Vidharbha Konkan Gramin Bank (VKGB) with Maharashtra Gramin Bank (MGB). Accordingly, Vidharbha Konkan Gramin Bank, sponsored by Bank of India will be amalgamated into Maharashtra Gramin Bank Sponsored by Bank of Maharashtra with effect from 1st May 2025.

Accounting Standard 5 - Net Profit or Loss for the period, prior period items and changes in accounting policies: As prior period items of income/expenditure are not material, the same have been charged/accounted for in respective heads of accounts during the year.

Accounting Standard 9 - Revenue Recognition: As per

Accounting Policy No. 6.2, given in Schedule -17 - Significant Accounting Policies, the interest payable on overdue term deposit is provided on accrual basis at rate of interest as applicable to saving account or contracted rate of interest on the matured TD, whichever is lower from 02.07.2021.

a. Pension Plan- This is a post-employment benefit, which is 50% of final pay for a maximum of 33 years of pensionable service. This is a funded scheme.

b. Gratuity Plan- This is a post-employment benefit and is payable as higher of Gratuity as per Company's Rules and Gratuity under Payment of Gratuity Act 1972 as amended. This is a funded scheme.

c. Leave Encashment/ Compensated Absences-This is a

post-employment benefit and is payable for a maximum limit of 255 days (240 days- upto March 31.03.2024) of accumulated leave based on final pay. This is a funded scheme

a) Treasury segment includes Investment, balances with Banks outside India, Interest accrued on investments and related income there from.

b) Corporate/Wholesale Banking Segments include all advances to trusts, partnership firms, companies, statutory bodies and individuals etc. which are not included in Retail Banking Segments.

c) Retail Banking Segments include exposure to entity/concern where

i. Total average annual turnover less than Rs. 50.00 crore and

ii. Aggregate exposure to one counter party does not exceed 0.2% of the overall retail portfolio of the Bank and

iii. The maximum aggregated retail exposure to one is upto Rs.7.50 crore.

d) Other Banking Operations segment includes all other banking transaction not covered under segments, specified above.

e) The interest income is allocated on the basis of actual interest received from wholesale banking operations. The total interest received less interest of wholesale banking is taken to retail banking operations

f) Expenses not directly attributable are allocated on the basis of Interest income earned by the wholesale banking / retail banking segment. Expenses of treasury operations are as per the details available from treasury operations

g) Capital employed for each segment has been allocated proportionate to the assets of the respective segment.

Part B: Geographical Segment

Since the operations of the Bank are within India only, Geographical Segment is not applicable.

Accounting Standard 18 - Related party disclosures

The details in this regard are as under:

Name of the Related Parties and their relationship:

a) Subsidiary of the Bank -The Maharashtra Executor & Trustee Co. Pvt. Limited

b) Associate of the Bank - Maharashtra Gramin Bank

c) Key Management Personnel- Details given in point no. 13 above

d) Sponsor Trust- Gramin Va Balak Vikas Mandal

e) Sponsor Trust- Mahabank Agricultural Research and Rural Development Foundation

f) Staff welfare Trust for Pension- Bank of Maharashtra Employees' Pension Fund

g) Staff welfare Trust for Gratuity- Bank of Maharashtra Employees' Gratuity Fund

h) Staff welfare Trust for Provident Fund -

Bank of Maharashtra Employees' Provident Fund

i) Staff welfare Trust for Leave Encashment- Bank of Maharashtra Employees Privilege Leave Encashment Fund Trust

Transactions with Related parties:

No disclosure is required in respect of related parties, which are "State Controlled Enterprises" as per paragraph no 9 of Accounting Standard (AS 18). Further in terms of paragraph 5 of AS 18, transactions in the nature of Banker-Customer relationship have not been disclosed including those with Key Management Personnel and relatives of Key Management Personnel.

Accounting Standard 19 - Leases

Finance Leases: Lease under which the Bank assumes substantially all the risks and rewards of ownership are classified as finance leases. Such assets acquired are capitalized at fair value of the asset or lease payments at the inception of the lease, whichever is lower.

Operating Leases: Operating Leases are cancellable at the option of the Bank. The amount of lease expenses recognized in the Profit and Loss Account for such operating lease is 252.04 crore for the year 2024-25 (for FY 2023-24 214.15 crore).

Accounting Standard 21 - Consolidated Financial

Statements: The financial results of the Associate viz. Maharashtra Gramin Bank and subsidiary viz. Maharashtra Executor & Trustee Company Private Limited have been consolidated with the parent bank in compliance with Accounting Standard 23 and Accounting Standard 21 respectively.

Accounting Standard 22 - Accounting for Taxes on Income: Based on the review by the bank and on reasonable certainty of availability of future taxable income against which timing differences arising on account of provision for accumulated losses, Bad & Doubtful Debts (NPA), employee benefits etc. can be realized, the bank has accounted for taxes on income in compliance with AS 22. Accordingly, Deferred Tax Assets and Deferred Tax Liabilities are as under:

As the bank has opted for lower tax rate permitted under section 115 BAA of the Income Tax Act 1961 from AY 2021-22, the provisions of section 115JB of the Income Tax Act are not applicable to the bank.

Accounting Standard -24- Discontinuing Operations: The

Bank, during the financial year 2024-25, has not discontinued any of its business activities/ operations which resulted in discharging of liabilities and realization of the assets and no decision has been finalized to discontinue a business activity in its entirety which will have the above effects

Accounting Standard 26—Accounting for Intangible Assets:

Computer Software - other than internally generated:

Useful life - 3 years.

Amortization Rate - 33.33 %

Amortization Method - Straight line at cost

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.

17) The Board has proposed dividend @15% i.e. R 1.50 per equity share (Face Value of R 10/- per share) for the Financial Year 2024-25 in Board Meeting dated April, 25 2025 subject to requisite approval from Shareholders.

18) The above Financial Statements have been reviewed and approved by the Board of Directors in their meeting held on April 25, 2025. In the absence of sufficient number of Independent Directors on the Board, Bank has invoked Para 14A of the Nationalized Banks (Management and Miscellaneous Provisions) Scheme, 1970 and placed the quarterly/yearly financial results directly to the Board for review and approval for want of quorum in Audit Committee of the Board. These results have been subjected to audit by the Statutory Central Auditors of the Bank and are in compliance with SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015.

19) Previous year's figures have been regrouped / reclassified wherever considered necessary to make them comparable with current year's figure.