The Directors of your Company are pleased to present the
38^th Annual Report of PNB Housing Finance Limited together
with the Audited Standalone Financial Statements and
Consolidated Financial Statements of the Company for the
Financial Year ended 31^st March 2026.

Financial Highlights (Consolidated)

The standalone and the consolidated financial statements for
the financial year ended 31^st March 2026, forming part of this
Annual Report, have been prepared in accordance with the
provisions of Companies (Indian Accounting Standard) Rules,
2015 ('Ind AS') in terms of Section 133 of the Companies Act,
2013 ('the Act') and other relevant provisions of the National
Housing Bank Act, 1987, the Reserve Bank of India (Housing
Finance Companies) Directions, 2025, Reserve Bank of
India (Non-Banking Financial Companies - Registration,
Exemptions and Framework for Scale Based Regulation)
Directions, 2025 and other Reserve Bank of India Directions
dated 28^th November 2025 to the extent applicable to the
Company and as amended from time to time.

The Net Interest Income (NII) for FY26 stood at H3,109.78
crore as compared to H2,749.63 crore, registering an increase
of 13.10% year on year. The Pre- Provision Operating
Profit (PPOP) increased by 11.04% to H2,584.45 crore from
H2,327.24 crore.

The Credit Cost including write-off (net of recovery) for FY26
was (H386.15) crore.

The Spread on loans for FY26 stood at 2.20% as compared
to 2.19%. Net Interest Margin (NIM) for FY26 stood at 3.68%
as compared to 3.70%. Gross Margin, net of acquisition cost
for FY26 was at 4.04% as compared to 4.11%. Return on
Asset (RoA) for FY26 was at 2.66% as compared to 2.55%.
Return on Equity (RoE) for FY26 was at 12.73% as compared
to 12.19%.

Reserves

During the year, the Company has transferred an aggregate
amount of H465.58 crore to reserves. This comprises a sum
of H340.00 crore transferred to Special Reserve and a sum of
H125.58 crore to the Statutory Reserve.

Capital Adequacy Ratio (CRAR)

As on 31^st March 2026, the Capital Adequacy Ratio (CAR) was
27.26% (comprising Tier I capital of 26.89% and Tier II capital
of 0.37%). CRAR before considering proposed Dividend was
27.51%. The Reserve Bank of India (RBI) has prescribed a
minimum CRAR of 15% of total risk weighted assets.

Dividend

The Company has demonstrated strong performance during
the FY26. We are pleased to recommend a dividend of H8
per equity share of face value of H10 each (previous year
dividend declared was H5/- per equity share), subject to
the declaration by the shareholders at the ensuing Annual
General Meeting, in terms with the Company's Dividend
Distribution Policy which is placed on the website of the
Company athttps://www.pnbhousing.com/investors/policies

Lending Operations

Your Company is a Non-Banking Financial Company- Housing
Finance Company (NBFC-HFC) and is engaged in financing
for purchase and/ or construction of residential houses,
loan against property and loan for other related purposes.

All other activities revolve around the main business of
the Company.

The Company had disbursed loans amounting to H26,548
crore during the year as compared to H21,972 crore in the
previous year (growth of 21%).

The Company has accelerated growth during the year with
focus on retail loans which contributed 98.74% of the total
disbursements. The Affordable and Emerging Markets
segment contributed 48% to the total retail disbursements.
The total pan India branch network of the Company is 392.

The Company has robust underwriting, monitoring, collection
and risk management practices that optimise operations and
elevate customer satisfaction.

Loan Asset

Loan Asset grew by 15% YoY to H87,347 crore as on
31^st March 2026. With continued focus on retail segment
during the year, the Company has grown retail loan book
by 16.23% from H74,802 crore to H86,946 crore whereas
the corporate loan book has declined by 58.36% from H963
crore to H401 crore in line with the strategy. The retail book
constitutes 99.54% of the Loan Asset as on 31^st March 2026.

The Assets Under Management (AUM) grew by 13.09% YoY to
H90,921 crore as on 31^st March 2026 as compared to H80,397
crore as on 31^st March 2025.

For further details of lending operations please refer the
Management Discussion and Analysis Report.

Asset Quality

The overall Gross Non-performing Assets (GNPAs) declined
by 15 bps to 0.93% as on 31^st March 2026 as compared to
1.08% as on 31^st March 2025. Corporate GNPA stood at Nil as
on 31^st March 2026 and 31^st March 2025.

The overall Net Non-performing Assets (NNPAs) declined to

0.57% as on 31^st March 2026 as compared to 0.69% as on
31^st March 2025. The corporate NNPA stood at Nil as on
31^st March 2026 and 31^st March 2025.

During the year 2025-26, the Company had auctioned 4,845
properties under the provisions of SARFAESI Act, 2002
and sold 670 properties with loan outstanding amounts
aggregating to H236.31 crore and the sale value were
aggregating to H217.1 crore. None of the sister concerns of the
Company participated in the auction(s).

The overall ECL provision coverage as on 31^st March 2026
was 1.05% (retail loans 1.04% and corporate loans 1.60%).

Distribution

During the year 2025-26, the Company expanded its
branch network to 392 Branches from 355 branches as
on 31^st March 2025.

The Company has 17 underwriting hubs for credit
decision making.

Borrowings

The outstanding borrowings as on 31^st March 2026, were
H71,199 crore as compared to H62,310 crore as on 31^st March
2025. During FY26, the Company had raised fresh resources
of H55,430 crore from multiple sources excluding deposits.

Your Company continues to maintain a diversified and
cost-effective funding strategy designed to support long¬
term financial strength and flexibility. Our borrowing mix
is well-balanced, drawing from bank loans, deposits, NHB
refinance, debt market instruments such as Non-convertible
Debentures (NCDs) and Commercial Papers (CPs), and
External Commercial Borrowings (ECBs). Amount under
each category of borrowings is presented below:

Details of market borrowings are provided in the Management
Discussion and Analysis Report and notes to accounts
(refer Note No. 18).

Deposits

The outstanding deposits (including accrued interest) as on
31^st March 2026 were H18,055.44 crore (including non-retail
deposits of H2,980.39 crore) as against H17,641.97 crore
(including non-retail deposits of H2,225.12 crore) as on 31^st March
2025, registering an increase of 2%. The Company has raised
H6,307 crore of total deposits (fresh renewal) during FY26.

The Company has accepted public deposits in terms of RBI
Master Directions as amended from time to time, latest being
Reserve Bank of India (Non-Banking Financial Companies -
Acceptance of Public Deposits) Directions, 2025 and Reserve
Bank of India (Housing Finance Companies) Directions, 2025
and as per the provisions of the Act, to the extent applicable.
The Company has paid interest on all the outstanding
deposits on due dates as per contract. There was no default
in repayment of deposits or payment of interest thereon
during FY26.

The deposits of the Company have been rated AA (Outlook
Stable) by CRISIL and CARE as on 31^st March 2026. The
deposit rating is revised to AAA (Outlook Stable) by CARE on
7^th May 2026.

Unclaimed Deposits

As on 31^st March 2026, the Company has the overdue public
deposits of I 4.65 Crore pertaining to 1000 Depositors. The
Depositors have been intimated regarding the maturity of
their deposits with a request to either renew or claim the
deposits, and subsequent reminders have been sent by SMS,
e-mails, etc. Further, your Company had been remitting
the maturity proceeds to the respective designated bank
accounts maintained in the name of the depositor, in the
absence of any specific instructions, where the bank account
particulars were correct.

Your Company is liable to transfer, deposits remaining
unclaimed for a period of seven years from the date
they became due for payment to the Investor Education
and Protection Fund (IEPF) established by the Central
Government under section 125 of the Act. During the year,
the Company has transferred an amount of I 39,08,518
pertaining to 323 Depositors to IEPF. The concerned
depositors can claim refund of the deposit amounts back from
the IEPF. The Company has provided the process of claiming
refund from IEPF, on the website of the Company

Investment in SLR

The Company is required to maintain Statutory Liquid Ratio
(SLR) as stipulated under RBI Master Directions on the
outstanding deposits, by way of investments in specified
securities or deposits in public sector undertakings. The
Company has maintained total SLR investments of H2,680.06
crore including accrued interest (Book value of H2,682.19
crore) as on 31^st March 2026.

Non-Convertible Debentures (NCDs)

During the year, the Company has raised H2,325 crore of
secured NCDs through private placements in different
tranches as against H2,230 crore in FY25. The outstanding
NCDs as at the end of FY26 were H7,531.17 crore. As
specified in the offer documents, the funds were utilised for
disbursement of loans to borrowers/ discharging existing
borrowings/ general corporate purposes.

The Company has complied with the provisions of the
Companies Act, 2013, related rules, RBI Master Directions
and SEBI NCS Regulations for issue of Non-Convertible
Debentures on private placement basis.

During FY26, the Company paid interest amounts from time
to time and principal amounts on redemption of NCDs, on
the respective due dates, in terms of the respective term
sheets. There were no delay or default in such payments/
re-payments. There were no unclaimed/ unpaid amounts
pertaining to principal or interest in respect of NCDs
issued by the Company, during the year. The Company is
not required to maintain debenture redemption reserve on
privately placed NCDs in terms of Ministry of Corporate
Affairs (MCA) Notification dated 16^th August 2019.

In terms of SEBI Circulars on contribution by eligible issuers
of listed debt securities, the Company had deposited H25 lakh
towards Recovery Expense Fund during the year, and also
the Company has been depositing funds to Core Settlement
Guarantee Fund of AMC Repo Clearing Limited, at the time of
issuance of each debt securities.

Investment in LCR

The Company has maintained the investments for its
Liquidity Coverage Ratio (LCR) as stipulated under RBI
Master Directions as amended from time to time, latest being
Reserve Bank of India (Non-Banking Financial Companies-
Asset Liability Management) Directions, 2025. The Company
has maintained average daily LCR of 179.48% for FY26.

Credit Rating

During the year, India Ratings upgraded the Company's long¬
term rating from AA 'Stable' to AAA 'Stable' for Bank Loan
facilities and Non-Convertible Debentures. The Company is
rated AA 'Stable' from all other major rating agencies i.e.
CRISIL, ICRA and CARE Ratings as on 31^st March 2026.

Further, on 7^th May 2026, CARE Ratings has upgraded PNB
Housing long term rating to AAA 'Stable' for Bank Loans,
Deposits and Bonds including NCD and Tier II.

The credit rating on deposits, term loans, NCDs and
commercial paper, and migration of rating during the year are
disclosed in the General Information to Shareholders forming
part of this Report.

Unclaimed Dividend

As on 31^st March 2026, dividend amounting to H3 lakh
pertaining to previous years i.e., FY19 and FY25, which
were not claimed by Shareholders of the Company, was
outstanding. The Company has been informing these
Shareholders by way of e-mails and letters from time to time
and newspaper advertisements requesting them to claim the
unclaimed dividend amounts.

For more details please refer General Information to
shareholders, forming part of this Report.

Business Responsibility &

Sustainability Report, Management
Discussion and Analysis Report and
Report of Directors on Corporate
Governance

In accordance with the provisions of SEBI (Listing Obligations
& Disclosure Requirement) Regulations, 2015, ('Listing
Regulations'), the Business Responsibility & Sustainability
Report (BRSR) forms part of this Annual report. The BRSR
indicates the Company's performance against the principles
of the 'National Guidelines on Responsible Business Conduct'
and the BRSR related policies of the Company. This would
enable the Members to have an insight into Environmental,
Social and Governance initiatives of the Company. The BRSR
is placed as Annexure-1 to this Report.

In accordance with the Listing Regulations and the Reserve
Bank of India Master Directions, the Management Discussion
and Analysis Report and the Report of Directors on Corporate
Governance form part of this report. A certificate on
compliance with the conditions of Corporate Governance
under the Listing Regulations is placed as Annexure-2, to
this Report.

Corporate Social Responsibility (CSR)

The Company has a CSR policy in place. The initiatives
on CSR taken during the year are detailed in this report,
Corporate Governance Report, and Management Discussion
and Analysis Report.

The total amount allocated for CSR activities for FY26 was
H42.25 crore and the funds were allocated to various projects
during the year. Out of this, an amount of H12.02 crore was
spent on various CSR activities in lumpsum or tranches
based on the progress of the project(s) during FY26. A sum
of H30.23 crore pertaining to various allocated CSR activities
and ongoing mega CSR project was transferred to Unspent
CSR Account of FY26 and will be spent as per schedule
within permissible timelines. The details of CSR activities
are captured in Annexure-3 to Directors Report. Additional
information on CSR is provided in Annexure-3A.

PEHEL Foundation

PEHEL Foundation, a wholly owned subsidiary of the
Company, serves as the primary implementation arm for
the Company's CSR initiatives, working in collaboration with
various partner agencies.

Brief outline of CSR Policy has been provided in Annexure-3
and the Policy is also available on the Company's website, in
compliance with the provisions of the Companies (Corporate
Social Responsibility Policy) Rules, 2014 and the Companies
(Accounts) Rules, 2014.

During the year, the Company concentrated on both flagship
and strategic interventions. The flagship initiatives were
aimed at improving the welfare of the construction workers'
community, while strategic interventions focused on key
areas such as healthcare, environment, education, women
empowerment, and sports.

Flagship Interventions

The construction workers community has been supported
with mobile medical units, skill development, etc.

Strategic Interventions

Healthcare: Strengthened Govt. hospitals with infrastructural
improvements, free primary healthcare through Mobile
Medical Unit, Mobile eye care unit for school students,
Equipment support to Multi-disability Rehabilitation Centre,
wheelchairs support to old age home and senior citizens,
Construction of double-storey insulated shelter along with
support of solar plants and electric medical beds.

Education: Upgradation of a school with library and
classroom infrastructure, holistic development for girls'
schools, School renovation project, Transport support
to home children, Digitalization and RO water support to
government schools, etc.

Environment: Projects for tree plantation, Bio-composting
Unit, solar electrification in schools, PHC and villages, etc.

Women Empowerment: Supported scholarship to girl
students, micro enterprise development, construction of
multipurpose centres, infrastructure Renovation of girls'
colleges and Hostel, renovation of SHG Run Ventures
canteen, Skill cum livelihood training to the women,
Upgradation of female examination ward and sanitation
in hospital and Supporting women with establishment of
production centres.

Sports Interventions: Supporting athletes preparing for
Olympics, Paralympics and other events with coaching,
training, and rehabilitations.

Human Resource

As on 31^st March 2026, the Company had 2,355 full time
employees on its rolls.

On-boarding of key positions and vacant positions at all
levels across locations were made to ensure uninterrupted
business operations.

Learning & Development team rolled out a structured learning
roadmap to enhance techno-functional and behavioural skills.
Delivered through a hybrid model, it supports continuous
development, aligns capabilities with business goals and
compliance needs, and fosters a culture of upskilling.

Disclosures on managerial remuneration covers the
remuneration of top 10 employees employed throughout the
year, who were in receipt of remuneration of '1.02 crore
or more per annum or in receipt of remuneration of '8.5
lakh or more per month consist of fixed salary, allowances,
perquisites/ taxable value of perquisites excluding perquisite
value of ESOPs exercised and ex-gratia amount.

In accordance with the provisions of Section 197(12) of the
Act and Rule 5(1) and details under Rule 5(2) & 5(3) of the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the names and particulars of the
top ten employees in terms of remuneration drawn and
other particulars are set out in the Annexure 4 to the
Directors' Report. The remuneration comprises of fixed
salary, allowances, perquisites/ taxable value of perquisites
excluding perquisite value of ESOPs exercised and ex-
gratia amount.

In terms of the provisions of Section 136(1) of the Act read
with the applicable rules, the Directors' Report is being sent
to all Shareholders of the Company excluding a portion of the
Annexure-4. Any Shareholder interested in obtaining a copy
of the Annexure may write to the Company.

The changes in the KMPs and/ or Senior Management
Personnel are covered in detail in the Report of Directors on
Corporate Governance.

Employees Stock Option Scheme (ESOP)
& Restricted Stock Units (RSU) Scheme

During the year 2,96,944 Equity Shares of H10 each were
allotted on exercise of ESOP options under ESOP Scheme
2016, 2,17,095 Equity Shares of H10 each were allotted on
exercise of ESOP options under ESOP Scheme 2018 and
46,010 Equity Shares of H 10 each were allotted on exercise
of ESOP options under ESOP Scheme 2022. Further, 64,486
Equity Shares of H 10 each were allotted on exercise of RSUs
under RSU Scheme 2020.

The details in terms with Rule 12(9) of The Companies (Share
Capital and Debentures) Rules, 2014, are uploaded annually
on the website of the Company on the tab titled 'ESOP'
with link:

https://www.pnbhousing.com/investors/updates-and-events

Grant of fresh ESOPs & RSUs

During the year, the Nomination and Remuneration Committee
had granted 9,48,500 options under ESOP Scheme 2018.
[5,80,500 options were granted at H1092.20; 108,000 options
at H1074.30; 30,000 options at H1072.10; 30,000 options at
H758.70 and 2,00,000 options at H932.85]. Further, granted
2,84,600 RSUs under RSU Scheme 2020 at H10 per unit and
2,34,508 RSUs under RSU Scheme 2022 at H10 per unit.

There has been no variation in the terms of the options
granted under any of these schemes and all the schemes
are in compliance with the SEBI (Share Based Employee
Benefits and Sweat Equity) Regulations, 2021 as amended.
The certificate from the Secretarial Auditors confirming that
ESOP Schemes have been implemented in accordance with
the SEBI (Share Based Employee Benefits and Sweat Equity)
Regulations, 2021 and Shareholder's resolutions will be
available for inspection. The Nomination and Remuneration
Committee monitors the compliance of these Schemes. The
disclosures as required under the regulations have been
placed on the website of the Company athttps://www.
pnbhousing.com/investors/updates-and-events along with
ESOP documents as required under the amended provisions
of SEBI Listing Regulations and SEBI (Share Based Employee
Benefits and Sweat Equity) Regulations, 2021.

Prevention, Prohibition and Redressal
of Sexual Harassment of Women at the
Workplace

The Company has adopted a policy on prevention, prohibition
and redressal of sexual harassment at the workplace.
Members of the Internal Committee constituted by the
Company are responsible for conducting inquiries pertaining
to such complaints and reporting.

The Company on a regular basis sensitises its employees
including employees of the subsidiaries on the prevention
of sexual harassment at the workplace through workshops,
group meetings, online training modules and awareness
programmes. Disclosure in relation to Sexual Harassment of
Women at Workplace (Prevention, Prohibition, and Redressal)
Act, 2013:

a. Number of complaints of sexual harassment received in
the year ended 31^st March 2026: Two

b. Number of complaints disposed of during the year:

2 complaints resolved and closed.

c. Number of cases pending for more than 90 days: NIL

d. Number of complaints pending at the end of the financial
year: NIL

Maternity Benefit Act, 1961

The Company is in compliance with the applicable provisions
relating to the Maternity Benefit Act, 1961.

Particulars of Loans, Guarantees or
Investments

The Company, being a HFC registered with the National
Housing Bank (NHB) and engaged in the business of
providing loans in ordinary course of its business, is exempt
from complying with the provisions of Section 186 of the
Companies Act, 2013, with respect to loans, guarantees and
investments, in terms of Section 186(11) of the Act.

The Company has an Investment Policy in place and has
complied with the applicable provisions. As regards,
investments made by the Company, the details of the same
are provided in Notes to Accounts as Note No. 7 for the year
ended 31^st March 2026, forming part of this Report.

Particulars of Contracts or
Arrangements with Related Parties

In accordance with the provisions of Section 188 of the Act
and rules made thereunder, the transactions entered with
related parties are in the ordinary course of business and on
an arm's length pricing basis. The particulars of contracts or
arrangements with related parties as prescribed in Form No.
AOC-2 of the Companies (Accounts) Rules, 2014 (Rule 2), are
annexed to this report as Annexure-5. Details of related party
transactions are given in the Notes to Accounts as Note
No. 36.10.

Justification for entering into Related Party Transaction: The
transactions are in the ordinary course of business and at
arm's length basis. PNB, being one of the largest nationalised
banks of India, offers various products including borrowings
and investment options at a competitive rates which is in
the interest of the Company and its stakeholders. Further,
Company also uses PNB brand and logo for which royalty fee
is paid to promoter at an arm's length price. Further, Company
deals with PNB and other associates of PNB group for better
service support for smooth operation of transactions, risk
mitigation due to insurance coverage, etc. in the ordinary
course of business and at arm's length pricing.

SEBI vide its various circulars required listed entities to
follow the Industry Standards on Minimum information to be
provided for review of the audit committee and shareholders
for approval of a related party transaction and the same is
effective from 01^st September 2025, in terms of the Circular
No. SEBI/HO/ CFD/CFD-PoD-2/P/CIR/2025/93 dated
₂₆th

June 2025. The Company has provided the minimum
information to the Audit Committee, and to the shareholders
in the explanatory statement of the Notice of AGM, while
seeking approval for material related party transactions. The
Company has been complying with the requirements as per
the applicable provisions.

The Policy on Related Party Transactions is published
elsewhere in the Annual Report and is also placed on

the Company's website athttps://www.pnbhousing.com/
investors/policies

Material changes and commitments,
if any, affecting the financial position

There were no material changes and commitments, and
there were no material contracts or arrangements affecting
the financial position of the Company, which has occurred
between the close of the FY26 and the date of this report.

In terms of Rule 5(ii) of the Companies (Accounts) Rules,

2014 there has been no change in the nature of business
of the Company. During the year, the members have, in
the 37^th Annual General Meeting held on 21^st August 2025,
approved for modification of Objects clause of Memorandum
of Association (MOA) with addition of a clause relating to
lending of unsecured loans.

Particulars regarding conservation
of energy, technology absorption and
foreign exchange earnings and outgo

As a housing finance company, our environmental impact is
largely limited to resource and energy use across distributed
operations. We leverage digital platforms to improve
efficiency, optimize paperwork, and strengthen data security.
Locations use energy-efficient measures, including LED
lighting and 3 and above star-rated appliances, with R32
refrigerants in new air conditioners. Recycled paper and
controlled printing further optimise consumption.

During the year, about H 1.0 million was invested in energy
initiatives driven by expansion and upgrades. Leased
premises are assessed for practical, cost-effective features.
The Company will continue monitoring opportunities and any
feasibility is evaluated, balancing environmental stewardship
with operational and financial prudence.

There was no import of technology during the previous three
financial years. The Company is a non-banking financial
company and is not involved in manufacturing or generating
of products of software. Hence, the clauses of absorption of
technology, import of technology, year of import and research
& development are not applicable.

There were no foreign exchange earnings. However, the
Company has incurred foreign exchange expenditure of
H140.49 crore (previous year H112.94 crore) during the year
primarily on account of interest on borrowings from external
sources and other expenses.

Business Continuity

The Company has a Business Continuity Plan (BCP), designed
to minimise operational, financial, legal, reputational, and
other material consequences arising from a disaster, if any.

The Business Continuity & Disaster Recovery policy at
the Company is developed with intent to prevent, contain,
and respond to potential disruptions that may impact the

continuity of business/support processes performed by the
Company, along with ensuring safety of its employees.

We have implemented multi-layered controls for identification,
prevention, detection, and response to various cyber security
threats. We have applied safeguards for protection of
customer information. We have framed Information security
policy, Cyber security policy and Cloud security policy to
support information security management system and to
protect business information at network, endpoint, perimeter,
application, and human layer.

Directors

As on 31^st March 2026, the Company had Seven Directors
comprising four Independent Directors, including a woman
director, two Non-Executive Nominee Directors and a
Managing Director & CEO.

The following were the changes in Directors during the year:

1. Dr. Tejendra Mohan Bhasin (DIN: 03091429) whose first
tenure ended on 1^st April 2025, was re-appointed as an
Independent Director of the Company to hold office for
a second term of five consecutive years commencing
from 2^nd April 2025, up to 1^st April 2030 (both days
inclusive). He has been re-appointed by the members
of the Company by passing special resolution on 20^th
March 2025, through Postal Ballot, on recommendations
of the Nomination & Remuneration Committee and

the Board.

2. Mr. Sunil Kaul (DIN: 05102910) resigned from the
position of Non-Executive Nominee Director on the
Board of the Company w.e.f. 2^nd May 2025. Quality
Investment Holdings PCC (QIH) sold 2,71,24,311 equity
shares of the Company representing 10.44% of the total
paid- up equity share capital of the Company, through
an open market transaction on 2^nd May 2025 and hence,
QIH had withdrawn the nomination of Mr. Sunil Kaul
from the Board of PNB Housing Finance Limited.

3. Mr. Girish Kousgi (DIN:08524205) resigned from the
position of Managing Director and Chief Executive
Officer of the Company vide his letter dated 30^th July
2025, to pursue opportunities outside, and the same
was accepted by the Board of Directors at its meeting
held on 31^st July 2025. The effective date of resignation
was 28^th October 2025 (close of business hours).

4. Mr. Dilip Kumar Jain (DIN: 06822012), Nominee Non¬
Executive Director had retired by rotation at the
37^th Annual General Meeting (AGM) on 21^st August
2025 and was re-appointed by the members as a non¬
executive nominee Director, on the recommendations
of the Nomination & Remuneration Committee and the
Board of Directors, in terms of Section 152 of the Act.

Mr. Dilip Kumar Jain superannuated from Punjab
National Bank with effect from 31^st August 2025.
However, Punjab National Bank, the promoter, had
continued the nomination of Mr. Jain up to 6 months
from the date of his superannuation or until induction

of new nominee director Mr. Dipankar Mahapatra,
whichever is earlier. Consequently, he tendered his
resignation from the Board of the Company as a
Non-Executive Nominee Director with effect from
4^th February 2026 (close of business hours) as
Mr. Dipankar Mahapatra was appointed in his place, as
the nominee director of the Promoter Bank.

5. Mr D. Surendran (DIN: 10174317) has been appointed as
Nominee Non-Executive Director of the Company for

5 years, as approved by the members of the Company
through Postal Ballot, effective from 23^rd August
2025, based on the recommendations of Nomination
and Remuneration Committee and the Board of
Directors. The Company had also obtained prior written
permission from the Reserve Bank of India in terms of
Para 45 of the Master Direction - Non-Banking Financial
Company - Housing Finance Company (Reserve Bank)
Directions, 2021, to hold office from 23^rd August 2025.
He has been nominated by Punjab National Bank (PNB).
His office is liable to retire by rotation.

6. Mr. Sudarshan Sen (DIN-03570051) completed his
tenure as an Independent Director of the Company on
30^th September 2025.

7. Mr. R Chandrasekaran (DIN- 00580842) completed his
tenure as an Independent Director of the Company on
6^th October 2025.

8. Mr. Pavan Kaushal (DIN- 07117387) has completed his
tenure as an Independent Director of the Company on
26^th October 2025.

9. Mr. Ajai Kumar Shukla (DIN:11358498) has been
appointed as Managing Director & Chief Executive
Officer (MD & CEO) and Key Managerial Personnel for
a period of 5 (five) years as approved by the members
of the Company through Postal Ballot, effective from
18^th December 2025, based on the recommendations of
Nomination and Remuneration Committee and the Board
of Directors. The Company has obtained prior written
permission/ approval from Reserve Bank of India in
terms of RBI (Non- Banking Financial Companies-
Governance) Directions, 2025.

10. Mr. Dipankar Mahapatra (DIN: 09446502) has been
appointed as Non-Executive Nominee Director for a
period of 5 (five) years as approved by the members
of the Company through Postal Ballot, with effect from
5^th February 2026 based on the recommendations of
Nomination and Remuneration Committee and the Board
of Directors. The Company has obtained prior written
permission/ approval from Reserve Bank of India in
terms of RBI (Non- Banking Financial Companies-
Governance) Directions, 2025. He has been nominated
by Punjab National Bank (PNB). His office is liable to
retire by rotation.

11. Mr. Nilesh Shivji Vikamsey (DIN- 00031213) has
completed his tenure as an Independent Director of the
Company on 21^st April 2026.

12. Mr. Shreekant (DIN: 11808336) has been appointed as an
Additional Director, Independent Director category, on
the Board of the Company with effect from

10^th July 2026, on the recommendation of Nomination

and Remuneration Committee.

13. Mr. Rajiv Kumar Singh (DIN: 03060652) has been
appointed as an Additional Director, Independent
Director category, on the Board of the Company with
effect from 10^th July 2026, on the recommendation of
Nomination and Remuneration Committee.

Proposals of appointment of Mr. Shreekant and Mr. Rajiv
Kumar Singh as Independent directors of the Company,
are placed to the members at the ensuing Annual General
Meeting (AGM) and the details are incorporated in the Notice
of the ensuing AGM and explanatory statement.

Pursuant to the provisions of Section 149 of the Act, all
the Independent Directors have submitted declarations
that each of them meet the criteria of independence as
provided in Section 149(6) and 149(7) of the Act along with
Rules framed thereunder and Regulation 16(1)(b) of the
SEBI Listing Regulations. There has been no change in the
circumstances affecting their status as Independent Directors
of the Company.

During the year under review, the Non-Executive Directors of
the Company had no pecuniary relationship or transactions
with the Company, other than sitting fees, commission
and reimbursement of expenses, if any as per the terms
of appointment.

Your Board wishes to place on record its sincere appreciation
for the contributions made by these Directors on the Board
and also on various Committees of the Board.

All the Directors of the Company have confirmed that they
satisfy the fit and proper criteria as prescribed under the
applicable regulations and that they are not disqualified from
being appointed as Directors in terms of Section 164(2) of
the Act. The Company has also received a certificate from the
Practising Company Secretary confirming that none of the
Directors have been debarred or disqualified and the same is
placed as Annexure-6, to this Report.

The Board is of the opinion that the Independent Directors
of the Company possess requisite qualifications, skills,
experience, and expertise. All the Independent Directors
of the Company have registered their names with the data
bank created for Independent Directors by Indian Institute of
Corporate Affairs (IICA), Ministry of Corporate Affairs.

The details on the number of the Meetings of Board and
the Board Committees held during the year are provided
in the Corporate Governance Report, which forms part of
this report.

The evaluation of Board, its Committees and individual
Directors was carried out in terms of the provisions of the
Act and SEBI Listing Regulations. For details, refer Corporate
Governance Report.

Upon recommendation of the Nominations and Remuneration
Committee (NRC), the Company has established a Policy
on Fit and Proper Criteria for Directors and a Nomination

and Remuneration Policy for Directors, Key Managerial
Personnel, Senior Management and other employees and
the same can be accessed on the website of the Company at
https://www.pnbhousing.com/investors/policiesas a part of
Internal guidelines on Corporate Governance.

Directors' Responsibility Statement

In accordance with the provisions of Section 134(3)(c)
of the Act and based on the information provided by the
management, your directors state that:

a) In the preparation of annual accounts, the applicable
accounting standards have been followed;

b) Accounting policies selected have been applied
consistently. Reasonable and prudent judgements and
estimates have been made so as to give a true and
fair view of the state of affairs of the Company as on
31^st March 2026 and of the profit of the Company for
the year ended on that date;

c) Proper and sufficient care has been taken for
the maintenance of adequate accounting records
in accordance with the provisions of the Act for
safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities;

d) The annual accounts of the Company have been
prepared on a going concern basis;

e) Internal financial controls have been laid down to be
followed by the Company and such internal financial
controls are adequate and operating effectively; and

f) Systems to ensure compliance with the provisions of
all applicable laws are in place, and are adequate and
operating effectively.

Changes in the Key Managerial Personnel

During the FY26, Mr. Girish Kousgi, Managing Director and
Chief Executive Officer has, vide his letter dated 30^th July
2025, tendered resignation to pursue opportunities outside,
and the effective date of resignation was 28^th October 2025.

Mr. Ajai Kumar Shukla (DIN:11358498), has been appointed
as Managing Director & Chief Executive Officer (MD & CEO)
and Key Managerial Personnel of the Company, effective from
18^th December 2025, for a period of 5 (five) years.

Policies and Codes

During the year, the Company has revised its policies and
codes as required in terms of provisions of the Act, RBI
Directions, SEBI Listing Regulations, etc., and placed all the
requisite policies on its website athttps://www.pnbhousing.
com/investors/policies.

Risk Management

The Company has implemented a comprehensive enterprise
level Integrated Risk Management (IRM) Policy, along with
separate policies for various type of risks material to our
business. The IRM policy provides overarching guidance for
all risk-related activities, encompassing credit, Asset Liability
Management (ALM), market, operational risk management,
information technology, cyber security, etc. Additionally, it
also defines the governance model and outlines the roles and
responsibilities of each component within the risk management
framework. For more details, please refer the Management
Discussion & Analysis Report and also the Report of Directors
on Corporate Governance forming part of this Annual Report.

Internal Financial Control & its Adequacy

The Company has put in place adequate policies and
procedures to ensure that the system of internal financial
control commensurate with the size and nature of the
Company's business.

These systems provide a reasonable assurance in respect
of providing financial and operational information, complying
with applicable statutes, safeguarding of assets of the
Company, prevention and detection of frauds, accuracy and
completeness of accounting records and ensuring compliance
with Company's policies.

Based on the framework of internal financial controls and
compliance systems established and maintained by the Company,
the work is performed by the internal, statutory and secretarial
auditors and external consultants, including the audit of internal
financial controls over financial reporting by the statutory auditors
and the reviews are performed by management and the relevant
board committees, including the Audit Committee. The Board is
of the opinion that the Company's internal financial controls were
adequate and effective during FY26.

Internal Audit

The Internal Audit function operating independently under the
oversight of the Audit Committee of the Board, gives objective
assurance to the Board on Company's internal control
processes, risk management and governance systems and
processes. The Internal Audit function is adequately staffed
with skilled personnel. The function adopts a risk-based audit
approach and carries out audits across retail mortgage and
construction finance business, audit of operations units and
other functions such as Treasury, Finance & Accounts, Risk,
Compliance, etc. Thematic audits, Information Security audit,
Spot checks and Concurrent audit are conducted in order
to independently evaluate the adequacy and effectiveness
of internal controls on an ongoing basis and proactively
recommending enhancements thereof.

The Internal Audit Department, during the course of audit,
also ascertains the adherence to regulatory guidelines, legal

requirements and operational processes and provides timely
feedback to the management for corrective actions.

In line with the RBI guidelines, quality assurance programme
is carried out by appointing an external agency, covering all
aspects of internal audit function.

Vigil Mechanism

The Company has a Whistle Blower Policy and has established
the necessary vigil mechanism for directors and employees in
confirmation with Section 177(9) of the Act and Regulation 22
of SEBI Listing Regulations, to raise concerns on any wrongful
conduct in the policies, procedures, codes and applicable laws,
rules and regulations of the Company or in relation to corruption,
misuse of office, criminal offence, suspected/ actual fraud,
fraudulent reporting, misappropriation or mismanagement of the
Company's assets. The Policy provides a framework to promote
responsible and secure whistle blowing by protecting its
employees. The policy has been appropriately communicated to
the employees within the organisation and has also been hosted
on the Company's website which can be accessed athttps://
www.pnbhousing.com/investors/policies

Regulatory Compliance

Following the amendment in the Finance Act, 2019 and
the subsequent notification by the Reserve Bank of India
(RBI) in August 2019, Housing Finance Companies (HFCs)
are being treated as one of the categories of Non-Banking
Financial Companies (NBFCs) for regulatory purposes and
accordingly come under RBI's direct oversight. The National
Housing Bank (NHB), however, would continue to carry out
supervision & refinance facilities for HFCs. In this regard
Master Direction - Non-Banking Financial Company -
Housing Finance Company (Reserve Bank) Directions, 2021
was notified on 17^th February, 2021 and thereafter the master
directions were amended from time to time.

Further, in an effort to streamline and reorganize the regulatory
instructions administered by its Department of Regulation
(DOR), the RBI undertook a consolidation exercise on 28^th
November 2025, whereby around 3,500 directions, circulars,
and guidelines were subsumed into 238 Master Directions
covering 11 categories of regulated entities. In the case of
NBFCs, 34 Master Directions were amended. Accordingly,
the erstwhile directions Master Direction - Non-Banking
Financial Company - Housing Finance Company (Reserve
Bank) Directions, 2021 was notified on 17^th February, 2021 has
now been superseded by the Reserve Bank of India (Housing
Finance Companies) Directions, 2025 dated 28^th November
2025, as amended from time to time.

The Company has been following guidelines, circulars and
directions issued by the RBI/ NHB, from time to time. The
Company has complied with the Reserve Bank of India Master
Directions applicable to NBFCs/ HFCs and other directions/
guidelines prescribed by RBI regarding deposit acceptance,
accounting standards, prudential norms for asset classification,
income recognition, provisioning, capital adequacy, credit

rating, corporate governance, information technology
framework, fraud monitoring, concentration of investments,
capital market exposure norms, guidelines on maintenance of
Liquidity Coverage Ratio (LCR), transfer of loans, know your
customer and anti-money laundering, etc.

RBI had issued a circular on "Scale Based Regulation (SBR):

A Revised Regulatory Framework for NBFCs" on 22^nd October
2021 ('SBR Framework'). As per the framework, based on
size, activity, and risk perceived, NBFCs are categorised into
four layers, NBFC-Base Layer (NBFC-BL), NBFC-Middle
Layer (NBFC-ML), NBFC-Upper Layer (NBFC-UL) and NBFC-
Top Layer (NBFC-TL). PNB Housing Finance Limited was
categorized as an NBFC-Upper Layer (NBFC-UL) vide RBI
press release dated 30^th September, 2022, 14^th September,
2023 and 16^th January, 2025. Subsequent to the
implementation of RBI (NBFC - Registration, Exemptions and
Framework for Scale Based Regulation) Second Amendment
Directions, 2026 effective June 24, 2026, the threshold
for classification under the Upper Layer has been revised
to include NBFCs having an asset size of 11,00,000 crore
and above, based on the latest audited financial statements.
Accordingly, PNB Housing Finance Limited may not fall under
Upper Layer list. However, in accordance with the regulatory
framework, the Company shall continue to comply with
enhanced regulatory requirements applicable to NBFC-Upper
Layer entities for a period of five years from its classification in
the upper layer.

RBI has issued the Master Direction - Reserve Bank of India
(Non-Banking Financial Company)- Scale Based Regulation)
Directions, 2023 dated 19^th October 2023 which has been
superseded by Reserve Bank of India (Non-Banking Financial
Companies - Registration, Exemptions and Framework for
Scale Based Regulation) Directions, 2025 dated 28^th November
2025, updated from time to time. The Company has put in
place necessary Board approved policies like Internal Capital
Adequacy Assessment Policy, Compensation Policy for Key
Managerial Personnel and Senior Management, Compliance
Policy, Board approved limits for Sensitive Sectors Exposure
under the SBR Framework, etc.

Application under Insolvency &
Bankruptcy Code, 2016

During the year, the Company has filed three applications
under the Insolvency and Bankruptcy Code, 2016, out of
which one application has been disposed off. As of now, 10
cases/ proceedings are pending under the Insolvency and
Bankruptcy Code, 2016 before NCLT and NCLAT.

The Company has not entered into one-time settlement for
any loans availed from the Banks or Financial Institutions.

Significant and Material Orders Passed
by Regulators

During the year, there were no significant or material
orders passed by the regulators or courts or tribunals that
would impact the going concern status or operations of

the Company in the future. The Details on penalties, fines,
strictures levied during the last three financial years are
provided in the Corporate Governance Report.

Statutory Auditors

Reserve Bank of India guidelines dated 27^th April 2021, on
Appointment of Statutory Central Auditors (SCAs)/Statutory
Auditors (SAs) of Commercial Banks (excluding RRBs), UCBs
and NBFCs (including HFCs) is applicable to your Company.

The Shareholders at their 36^th Annual General Meeting (AGM)
have appointed M/s. C N K & Associates LLP, Chartered
Accountants (Firm Registration No.101961 W/W-100036) and
M/s M M Nissim & Co LLP, Chartered Accountants (Firm
Registration No. 107122 W/ W100672) as the Joint Statutory
Auditors of the Company for a period of three years from the
conclusion of 36^th AGM i.e., from 12^th August 2024, till the
conclusion of the 39^th AGM of the Company.

During the year, the Statutory Auditors remuneration was
H1.62 crore (Remuneration of the Statutory Auditor of the
Subsidiary Company is H0.10 crore). The remuneration
pertains to fees for statutory audit, internal financial control
reporting, limited reviews, tax audits, certifications, and
reimbursement of expenses.

During the year under review, the Statutory Auditors did not
have any matter requiring reporting under Section 143 (12) of
the Act. Therefore, there is no reporting disclosure required
under Section 134 (3) (ca) of the Act.

The Statutory Auditors Report for the year ended 31^st March
2026, does not contain any qualifications, observations or
adverse comments.

The Statutory Auditors have confirmed that they continue
to satisfy the eligibility norms and independence criteria as
prescribed by RBI guidelines and the Companies Act, 2013.

Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Act
and Regulation 24A of the SEBI Listing Regulations, the
shareholders at their 37^th AGM held on 21^st August 2025, have
appointed M/s. Vinod Kothari & Company, Practicing Company
Secretaries (Firm registration no: P1996WB042300), as
Secretarial Auditors of the Company for a term of five
consecutive years, commencing from FY26 till FY30.

The Secretarial Audit Report for the financial year ended
31^st March 2026, as required under Section 204 of the
Act and Regulation 24A of the SEBI Listing Regulations, is
annexed to this Report as Annexure-7. Your Company is in
compliance with the applicable Secretarial Standards issued
by the Institute of Company Secretaries of India and approved
by the Central Government under Section 118(10) of the Act.

The Secretarial Auditor's Report does not contain any
qualifications, observations or adverse comments.

In terms of Reg.24A of SEBI Listing Regulations, 2015, your
Company has submitted the Annual Secretarial Compliance
Report for FY26 issued by M/s Vinod Kothari & Company
to the Stock Exchanges within the prescribed time and the
same is available on websites of the Company and Stock
Exchanges. The same is placed as Annexure-8, to this Report.

Maintenance of Cost Records

Being a housing finance company, your Company is not
required to maintain cost records as per sub-section (1)
of Section 148 of the Act & Rule 5(ix) of the Companies
(Accounts) Rules, 2014.

Annual Return

The Annual Return in Form MGT-7, provisional, as on

31^st March 2026 is available on the website of the Company at

https://www.pnbhousing.com/investors/annual-return.

Subsidiaries of the Company

PHFL Home Loans and Services Limited (PHFL)

PHFL is a wholly owned subsidiary and is the distribution
arm for PNB Housing, offering doorstep services to the
prospective customers. The Subsidiary has trained workforce
to source business for the loans and deposits offered by
PNB Housing. During the year, the PHFL has sourced loan
applications in respect of 74% of total loans disbursed by PNB
Housing Finance. A report on the performance and financials
of PHFL, as per Act and rules made thereunder is provided
in Form AOC-1 attached to the Consolidated Financial
Statements forming an integral part of this Annual Report.

PEHEL Foundation

PEHEL Foundation is the implementation arm of the Company
for CSR activities along with other partnering agencies. It is
a wholly owned non-profit subsidiary Company incorporated
under Section 8 of the Act as an implementation arm to
carry out various CSR activities of PNB Housing Finance and
PHFL. A report on the performance and financials of PEHEL
Foundation, as per Act and rules made thereunder is provided
in Form AOC-1 attached to the Consolidated Financial
Statements forming an integral part of this Annual Report.

During the year, under review, there was no material change
in the nature of the business of the subsidiaries. There are no
associates or joint venture companies within the meaning of
Section 2(6) of the Companies Act, 2013.

Further, pursuant to the provisions of Section 136 of the
Act, the financial statements of the Company, consolidated
financial statements along with relevant documents
and separate audited financial statements in respect of
subsidiaries, are available on the Company's website at
https://www.pnbhousing.com/investors/annual-reports

Other Disclosures

Your Directors hereby clarify that during the year ended

31^st March 2026, the following disclosures were not

applicable/ there were no such transactions in the year

under review:

1. There has been no issue of Equity Shares with
differential rights as to dividend, voting or otherwise.

2. Your Company has not resorted to any buy back of its
Equity Shares during the year under review.

3. The Managing Director & CEO of your Company did not
receive any remuneration or commission during the
year from the subsidiary of the Company.

4. No loans were provided to the employees for purchase
of shares of the Company for the purpose mentioned in
Section 67(3) of the Act.

5. The names of companies which have become or ceased
to be its subsidiaries, joint ventures or associate
companies during the year: NIL

6. The securities of the Company were not suspended from
trading during the year.

7. During the year, there were no frauds identified that
will have a material impact on the financial position of
the Company. The Company has identified/declared
one corporate fraud Account involving borrowers Sarv
Realtors Private Limited, Supertech Limited and ASP
Sarin Reality Private Limited amounting Rs.237.43 Crore.
However, account was already written-off in FY 2022¬
23 and hence, there is no material impact on the overall
financials and operations of the Company.

8. There was no issue of shares during the year ended
31^st March 2026, other than ESOPs and RSUs. Hence,
the explanation for variation of utilisation of proceeds, if
any, as per Regulation 32 (4) of SEBI Listing Regulations,
is not applicable.

Acknowledgements

The Directors place on record their gratitude for the
support of various authorities including Reserve Bank of
India, National Housing Bank, Securities and Exchange
Board of India, Ministry of Housing and Urban Affairs,

Ministry of Corporate Affairs, Registrar of Companies,
Financial Intelligence Unit (India), Insurance Regulatory
and Development Authority of India, Stock Exchanges and
the Depositories.

The Company acknowledges the role of all its key
stakeholders-shareholders, banks and other lenders,
investors, borrowers, channel partners, depositors, deposit
agents, Auditors, Consultants, Registrar & Transfer Agent,
Trustees, etc., for their continued support.

The Directors express their appreciation for the dedication
and commitment with which the employees of the Company
at all levels have worked during the period.

For and on behalf of the Board

Ajai Kumar Shukla D. Surendran

Managing Director & CEO Chairperson,

Non-Executive Nominee Director

Place: New Delhi
Date: 10^th July 2026