Shriram City Union Finance Limited - Karvy

For further information on the Prudential Norms Directions, 2007, refer to the section titled “Regulations andPolicies” beginning on page 175 this Prospectus.Our Audit Committee has constituted a policy for making provisions in excess of the amounts prescribed by RBIand we may make further provisions if we determine that it is prudent for a known and identified risk. Based on ourpolicy our provisions as of March 31, 2011 stood at ` 9,983.42 lakhs as compared to the RBI required minimumprovision of ` 9,249.10 lakhs.The following table sets forth, as of the dates indicated, data regarding our NPAs:Period Gross NPA (`in lakhs)March 31,2007March 31,2008March 31,2009March 31,2010March 31,2011Net NPA (` inlakhs)Total LoanAssets (` inlakhs)Net LoanAssets (1) (` inlakhs)% of GrossNPA to TotalLoan Assets% of NetNPA to NetLoan Assets4,040.66 2,561.44 171,048.30 169,569.09 2.36 1.514,228.66 2,495.70 274,857.78 273,124.82 1.54 0.917,784.03 3,590.35 375,395.10 371,201.42 2.07 0.9710,753.30 3,322.73 473,135.02 465,704.45 2.27 0.7112,966.18 2,982.76 698,919.09 688,935.67 1.86 0.43Our Gross NPAs as a percentage of Total Loan Assets were 1.86% as of March 31, 2011. Our Net NPAs as apercentage of Net Loan Assets was 0.43% as of March 31, 2011. We believe that our eventual write-offs arerelatively low because of our relationship based customer origination and customer support, prudent loan approvalprocesses, including adequate collateral being obtained and our ability to realize such collateral in a timely manner.Funding SourcesWe have expanded our sources of funds in order to reduce our funding costs, protect interest margins and maintain adiverse funding portfolio. This will enable us to achieve funding stability and liquidity. Our sources of fundingcomprise term loans including term loans from banks and financial institutions, cash credit from banks, redeemablenon-convertible debentures on a private placement basis, subordinated bonds, short term commercial paper, publicdeposits, and inter-corporate deposits.BorrowingsThe following table sets forth the principal components of our secured loans as of the dates indicated:As of March 31` In LakhsSECURED LOANS 2007 2008 2009 2010 2011Redeemable non-convertibledebentures60,968.50 69,106.39 127,741.10 154,073.77 219,877.64Term loans:- Term loans from banks 41,453.74 115,755.02 143,562.74 104,634.17 295,677.28- Term loans from financialinstitutions, and corporate1,161.00 10,513.00 9,426.40 9,530.00 6,500.00Cash credit from banks includingworking capital demand loans26,800.92 67,420.99 109,715.19 145,372.61 134,896.0992