Integrated Annual Report 2025-26 446 Narrative Description of Collateral Collateral primarily include vehicles purchased by retail loan customers, residential property in case of housing loan and machinery & property in case of SME customers. The financial investments are secured by way of a first ranking pari-passu and charge created by way of hypothecation on the receivables of the other company. Gross value of total secured loans to value of collateral Rupees crores Loan To Value (LTV) Gross value of secured loans 2026 2025 Upto 50% coverage......................................................................................................................................................................................... 14,491.14 12,765.10 51 - 70% coverage.......................................................................................................................................................................................... 22,594.74 19,684.85 71 - 100% coverage....................................................................................................................................................................................... 73,858.16 67,699.08 Above 100% coverage.................................................................................................................................................................................. 24,714.97 21,285.88 1,35,659.01 1,21,434.91 Quantitative Information of Collateral - Credit Impaired assets (Collateral Coverage - Value of collateral available to mitigate the credit exposure) Rupees crores Loan To Value (LTV) Gross Value of loans in stage 3 2026 2025 Upto 50% coverage......................................................................................................................................................................................... 782.33 941.47 51 - 70% coverage.......................................................................................................................................................................................... 847.14 970.57 71 - 100% coverage....................................................................................................................................................................................... 1,671.03 1,881.49 Above 100% coverage.................................................................................................................................................................................. 1,489.40 1,265.79 4,789.90 5,059.32 (v) Transferred financial assets that are not derecognised in their entirety - Securitisation transactions The financial services business has transferred certain pools of fixed rate loan receivables backed by underlying assets in the form of tractors, vehicles, equipments etc. by entering in to securitisation transactions with the Special Purpose Vehicle Trusts (“SPV Trust”) sponsored by Commercial banks for consideration received in cash at the inception of the transaction. The financial services business, being Originator of these loan receivables, also acts as Servicer with a responsibility of collection of receivables from its borrowers and depositing the same in Collection and Payout Account maintained by the SPV Trust for making scheduled payouts to the investors in Pass Through Certificates (PTCs) issued by the SPV Trust. These securitisation transactions also requires the financial services business to provide for first loss credit enhancement in various forms, such as corporate guarantee, cash collateral, subscription to subordinated PTCs etc. as credit support in the event of shortfall in collections from underlying loan contracts. By virtue of existence of credit enhancement, the financial services business is exposed to credit risk, being the expected losses that will be incurred on the transferred loan receivables to the extent of the credit enhancement provided. In view of the above, the financial services business has retained substantially all the risks and rewards of ownership of the financial asset and thereby does not meet the derecognition criteria as set out in Ind AS 109. The following table provide a summary of financial assets that have been transferred in such a way that part or all of the transferred financial assets do not qualify for derecognition, together with the associated liabilities: Rupees crores Particulars 2026 2025 Securitisations Carrying amount of transferred assets measured at amortised cost...................................................................... 12,731.04 8,623.56 Carrying amount of associated liabilities...................................................................................................................................... 12,928.11 8,732.98 Fair value of assets (A)............................................................................................................................................................................... 13,325.56 8,482.49 Fair value of associated liabilities (B)............................................................................................................................................... 13,233.71 8,909.62 Net position (A-B) 91.86 (427.13) 40. Financial instruments (Continued) (b) Credit Risk Management (Continued)
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