Financial Overview and Strategy

Leverage risk methodology B BAJAJ FINSERV Methodology used to calculate leverage risk of unsecured portfolios (Personal loan cross sell, Salaried personal loans, Business loans, Professional loans, Rural lending unsecured loans) X axis represents the vintage of portfolio basis quarter of origination. For example, loans sourced in Q4 FY17 has 0 month (OM) vintage in Q4 FY17 and 24 months (24M) vintage in Q4 FY19 Y axis represents the percentage growth in average outstanding unsecured exposure (on-us and off-us) of customers through the vintage period (OM to 24M). Vintage lines within the graph represent the average outstanding unsecured exposure of BFL customers (on-us and off-us) baselined to 100 in the quarter of origination. For example, for salaried personal loans portfolio, all loans sourced by BFL in Q4 FY17, customer's average unsecured outstanding exposure has been calculated on-us and off- us and is based to 100 for 'OM' vintage. Vintage line represents movement of average unsecured outstanding exposure over a period of 24M. To illustrate, average outstanding exposure of salaried personal loan customers originated in Q4 FY17 has grown by 5% in '12M' and 12% in '24M' as shown in second graph. Nominal GDP growth is at ~11.5%. Hence, if the average unsecured exposure on-us and off-us has grown by ~12% in '12M' & ~25% in '24M', then we consider the leverage is in line For all the portfolios the average unsecured exposure has grown in line and is range bound for all the vintages except for Q4 FY17 vintage for business loans. For personal loan cross sell customers, average outstanding unsecured exposure for Q4 FY17 has grown by 6% in 24 months For salaried personal loan customers, average outstanding unsecured exposure for Q4 FY17 has grown by 12% in 24 months For business loan customers, average outstanding unsecured exposure for Q4 FY17 has grown by 18% in 24 months For professional loan customers, average outstanding unsecured exposure for Q4 FY17 has grown by 30% in 24 months For rural unsecured loan customers, average outstanding unsecured exposure for Q4 FY17 has remained flat 50 0

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