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Ref No: PSB/HO/Shares Cell / 43 /2026-27 August 22, 2026 BSE Limited, National Stock Exchange of India Ltd., Department of Corporate Services, Exchange Plaza, C – 1, Block – G, 25th floor, Phiroze Jeejeebhoy Towers, Bandra Kurla Complex, Bandra (East), Dalal Street, Fort, Mumbai – 400 051. Mumbai – 400 001. SYMBOL: PSB SERIES: EQ SCRIP ID : PSB SCRIP CODE : 533295 Dear Sir, Reg: Rating by CARE Ratings We are pleased to inform that that CARE Ratings vide Press Release dated August 21, 2026 has reaffirmed the Rating of the Tier II Bonds issued by the Bank as detailed hereunder: Instrument Type Rating & Outlook Tier II Bond Series XIV of Rs 500 crore CARE AA; Stable (Reaffirmed) Tier II Bond Series XV of Rs 237.30 crore CARE AA; Stable (Reaffirmed) Tier II Bond Series XVI of Rs 500 crore CARE AA; Stable (Reaffirmed) The Press Release is enclosed for reference. We request you to take note of the above pursuant to Regulation 30 and 51 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Yours faithfully Saket Mehrotra Company Secretary Head Office: 21, Rajendra Place, New Delhi-110008 Corporate Office: NBCC Office Complex, Block 3, East Kidwai Nagar, New Delhi – 110023 Email: complianceofficer@psb.co.in Press Release Punjab and Sind Bank August 21, 2026 Facilities/Instruments Name of the Regulator1 Amount (₹ crore) Rating2 Rating Action Tier-II Bonds& SEBI 500.00 CARE AA; Stable Reaffirmed Tier-II Bonds& SEBI 237.30 CARE AA; Stable Reaffirmed Tier-II Bonds& SEBI 500.00 CARE AA; Stable Reaffirmed Details of instruments/facilities in Annexure-1. &Tier-II Bonds under Basel III are characterised by a ‘Point of Non-Viability’ (PONV) trigger due to which the investor may suffer a loss of principal. PONV will be determined by the Reserve Bank of India (RBI) and is a point at which the bank may no longer remain a going concern on its own unless appropriate measures are taken to revive its operations, and thus, enable it to continue as a going concern. In addition, the difficulties faced by a bank should be such that these are likely to result in the financial losses and raising the Common Equity Tier-I capital of the bank should be considered as the most appropriate way to prevent the bank from turning non-viable. Rationale and key rating drivers Reaffirmation of the rating to the debt instruments of Punjab and Sind Bank (PSB) considers the improvement in asset quality in FY26 aided by recoveries and lower incremental slippages. The rating continues to favourably factor in majority ownership of and demonstrated and expected support from Government of India (GoI), comfortable capitalisation levels supported by multiple equity infusions in the past and accretion of profit in recent years, and established presence in northern states of India. Going forward, CARE Ratings Limited (CareEdge Ratings) expects recovery in the bank’s net interest margin (NIM) in line with the industry trend due to diversification of business mix in favour of higher yield retail products. With comfortable capitalisation, CareEdge Ratings expects the bank’s advances to grow at higher rate than that of the industry. However, the rating remains constrained by the fact that despite improvement, PSB’s profitability remains moderate in comparison to peer banks with high interest expenses and operating costs and sizeable share of non-earning assets in the form of zero- coupon recapitalisation bonds. The rating also factors in PSB’s relatively lower proportion of low-cost current account savings account (CASA) deposits and high geographical concentration in the states of northern India with major presence in New Delhi and Punjab. CareEdge Ratings notes that despite improvement in potential weak assets (SMA 1 and 2) in FY26, net stressed assets of PSB remain high in relation to its net worth compared to peer public sector banks. Rating sensitivities: Factors likely to lead to rating actions Positive factors: Factors that could individually or collectively lead to positive rating action/upgrade: • Significant improvement in the size of the bank and profitability while maintaining comfortable capitalisation and good asset quality. Negative factors • Dilution in GoI support philosophy or in its stake in the bank below 51%. • Deterioration in asset quality parameters with gross non-performing asset (GNPA) exceeding 5% on a sustained basis. • Significant decline in capitalisation cushion above the minimum regulatory requirement on a sustained basis. Analytical approach: Standalone The rating is based on standalone profile of the bank and factors in continued support from GoI, which holds majority shareholding in the bank. Outlook: Stable The ‘Stable’ outlook reflects CareEdge Ratings’ expectation of continued growth in earnings with further improvement in asset quality parameters while maintaining comfortable capitalisation levels in the near-to-medium term. 1SEBI: Securities and Exchange Board of India; RBI: Reserve Bank of India; MCA: Ministry of Corporate Affairs; IRDAI: Insurance Regulatory and Development Authority of India; PFRDA: Pension Fund Regulatory and Development Authority 2Complete definitions of the ratings assigned are available at www.careratings.com and in other CARE Ratings Limited’s publications. 1 CARE Ratings Ltd. Press Release Detailed description of key rating drivers Key strengths Majority ownership and support by GOI GOI continues to be the majority shareholder holding 93.85% stake in PSB. GoI has been supporting public sector banks with regular capital infusions and taking steps to improve capitalisation, operational efficiency, and asset quality. In FY22, GOI had infused equity capital of ₹4,600 crore into the bank, which helped the bank in improving the capital ratios and support growth. GOI has infused cumulative capital of ₹11,672 crore (₹785 crore in FY18, ₹787 crore in FY20, ₹5,500 crore in FY21 and ₹4,600 crore in FY22) against recapitalisation bonds (with maturities between 10 and 15 years). Given the majority ownership of GOI, CareEdge Ratings expects PSB to receive timely and adequate support in the form of capital as and when required. Adequate capitalisation levels PSB has received significant amount of equity capital against zero coupon recapitalisation bonds in FY21 and FY22 (₹5,500 crore in FY21 and ₹4,600 crore in FY22) from GoI. The bank’s profitability improved over the last four years leading to accretion to net worth, which has helped the capitalisation level of the bank. In FY25, pursuant to the Reserve Bank of India’s (RBI’s) amendment to the ‘Master Direction - Classification, Valuation and Operation of Investment Portfolio of Commercial Banks (Directions), 2021’ dated March 31, 2022, PSB had fair valued the investments in recapitalisation bonds of ₹10,100 crore received in FY21 and FY22; however, the difference was not adjusted through P&L as required by the notification as the bank was given special exemption by RBI to not do so. As a result, the bank’s tangible net worth declined as the adjustment was routed directly through General Reserves of the bank. In FY25, the bank raised equity capital of ₹1,219 crore through qualified institutional placement (QIP) of equity shares which along with accretion of profit helped the bank’s capitalisation levels. The bank reported an improvement in capital adequacy parameters and reported capital adequacy ratio (CAR) of 17.42% with Common Equity Tier (CET) I Ratio of 15.92% as on March 31, 2026, compared to CAR of 17.41% with CET I Ratio of 15.59% as on March 31, 2025. As on June 30, 2026, the bank reported CAR of 17.61% and CET I Ratio of 16.56% The bank has board approval to raise equity capital of up to ₹3,000 crore through QIP of equity shares and ~₹2,000 crore through issue of Tier-II / Tier-I Bonds. GoI would be required to reduce its shareholding in the bank to below 75% to enable it to meet the regulatory criteria for public shareholding. The bank has significant cushion over the [Showing first 8,000 characters — download PDF for full document]