DFCC Bank PLC is pleased to present its 13th Integrated Annual Report covering the financial year ended 31 December 2025, showcasing how sustainable long-term stakeholder value is delivered through resilience and responsible growth.

Scan the QR code or visit the web link provided to view this Integrated Annual Report.

https://www.dfcc.lk/investor/reports/annual-reports

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Annual Report 2025

This Integrated Annual Report presents a connected, decision-useful view of DFCC Bank PLC’s (“DFCC Bank”, “DFCC” or “the Bank”) strategy, performance, governance, and outlook for the financial year from 1 January 2025 to 31 December 2025. It explains how we create, preserve, and protect value over the short, medium, and long term, balancing financial performance with environmental stewardship, social responsibility, and robust governance.

Moving towards elevating the transparency and accountability of corporate reporting, we officially adopted SLFRS Sustainability Disclosure standards, with climate-first reporting for the reporting period ended 31 December 2025. To preserve the integrity of the disclosures under the International Integrated Reporting Framework, SLFRS Sustainability Disclosures, and GRI Standards, we conduct an in-depth alignment of these frameworks to ensure harmonised, integrated, and transparent reporting.

The Board of Directors of DFCC Bank have instituted a comprehensive governance framework designed to uphold long-term sustainability and foster strategic growth. Anchored in the principles of transparency, accountability, and ethical governance, this framework ensures that every decision reflects DFCC Bank’s vision, mission, and core values. By deploying forward-thinking strategies and optimising resources, the Bank safeguards stakeholder interests while driving innovation and resilience across its operations.

Complementing this, DFCC Bank maintains an independent risk governance structure led by the Corporate Management team and overseen by the Board and its sub-committees. This structure enables proactive identification of emerging risks and opportunities, rigorous assessment of their potential impact, and continuous monitoring of industry-specific challenges.

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Through this disciplined approach, DFCC Bank strengthens its ability to adapt to dynamic market conditions, enhance climate and sustainability resilience, and deliver informed, value-driven decisions that reinforce stakeholder confidence.

Transition provisions for Sustainability-related Financial Disclosures
With regard to SLFRS S1 and S2 reporting, DFCC Bank has utilised the following transition provisions within the standard (SLFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information – Appendix E and SLFRS S2 Climate-related Disclosures – Appendix C on “Effective date and transition”):
• SLFRS S1 – Disclosure of information on only climate-related risks and opportunities: In the first annual reporting period in which an entity applies this standard, the entity is permitted to disclose information on only climate-related risks and opportunities (in accordance with SLFRS S2) and consequently apply the requirements in this standard only in so far as they relate to the disclosure of information on climate-related risks and opportunities.
• SLFRS S1 – Disclosure of comparative information: In the first annual reporting period in which an entity applies this standard, it is not required to disclose comparative information about its climate-related risks and opportunities; and In the second annual reporting period in which the entity applies this standard, it is not required to disclose comparative information about its sustainability-related risks and opportunities
• SLFRS S2 – Disclosure of Scope 3 greenhouse gas emissions: Entities must initially report only Scope 1 and Scope 2 emissions. Full compliance with Scope 3 emissions, becomes mandatory two years after the initial application date
• SLFRS S2 – Disclosure of qualitative information regarding anticipated financial effects of climate-related risks and opportunities: Entities are permitted to defer the disclosure of qualitative information regarding anticipated financial effects for a period of two years following the mandatory application of the standard
• SLFRS S2 – Disclosures on Climate resilience: Relief period of two years is granted to apply the requirements from the date of mandatory application to fully comply with climate resilience disclosure requirement

By embracing this adoption, we reinforce our commitment to transparency, resilience, and continuous enhancement in sustainability reporting, ensuring stakeholders receive reliable, high-quality, and decision-useful information.

Reporting Boundary

This Report is prepared in alignment with the boundaries of DFCC Bank’s Financial Statements and consolidated information on the Bank and its subsidiaries, collectively referred to as “the Group”. All stakeholders and entities addressed herein are identified and discussed in accordance with the International Integrated Reporting Framework, ensuring a holistic, consistent, and transparent approach to disclosure.

DFCC Bank PLC is the largest entity in the Group, accounting for a significant proportion of total assets, gross income, and profit after tax as at 31 December 2025. The Group’s operations are primarily based in Sri Lanka, reflecting the Bank’s commitment to supporting sustainable economic growth within the local context while aligning with global best practices. Unless otherwise stated, non-financial, risk management, and corporate governance disclosures are related to DFCC Bank PLC (“Bank”).

Changes to Reporting
During the reporting period, the following changes occurred in relation to the Bank’s size, shareholding, and organisational structure:
• Divestment of Acuity Partners (Pvt) Ltd. – In January 2025, DFCC Bank divested its 50% shareholding in Acuity Partners (Pvt) Ltd.
• Acquisition of Standard Chartered Bank's Wealth and Retail Banking Business in Sri Lanka – DFCC Bank entered into a binding Business Sale Agreement with Standard Chartered Bank, United Kingdom (operating through its branch in Sri Lanka), to acquire its wealth and retail banking operations. The acquisition covers Priority Banking, credit cards, retail lending, deposits, and small and medium-sized enterprises (SMEs). As the transaction is expected to be finalised in 2026, it has not had a significant impact on the changes reflected in this year’s reporting.

For sustainability reporting under the Global Reporting Initiative (GRI) Standards, the reporting boundary is DFCC Bank PLC. For sustainability-related financial disclosures aligned with SLFRS S1 and S2, the reporting boundary covers the DFCC Group, which includes DFCC Bank as the parent entity and its subsidiaries Synapsys Ltd. (100% ownership), Lanka Industrial Estates Ltd. (LINDEL) (51.16% ownership) and DFCC Consulting (Pvt) Ltd. (100% ownership).

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Guiding Principles of the Integrated Annual Report

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Materiality Approach

The principle of materiality guides the scope and content of this Integrated Annual Report by identifying the matters that significantly influence DFCC Bank’s ability to create and preserve value over the short, medium, and long term. These matters reflect the Bank’s most critical strategic priorities, risks, and opportunities that materially affect its capitals, performance, and long-term sustainability.

Impact Materiality

DFCC Bank PLC’s impact on people and planet

Double Materiality


The impact of external environment, risks, and opportunities on the DFCC Bank PLC
Financial Materiality

Material matters were identified through a comprehensive materiality assessment conducted during the year. This assessment combined insights derived from structured stakeholder engagement with an evaluation of the external operating environment. The process was undertaken using a double materiality approach, enabling a holistic assessment of matters that are significant to both the Bank and its stakeholders. Under this approach, financial materiality considers risks, opportunities, and outcomes that may influence assessments of the Bank’s future cash flows, financial position, and cost of capital over the short, medium, and long term, including factors beyond traditional financial reporting boundaries. Impact materiality evaluates the significance of the Bank’s activities and decisions on the economy, society, and the environment over the same time horizons, irrespective of whether such impacts have an immediate financial effect on the Bank.

The material topics identified through this process, presented on pages 58 to 65, form the foundation of the Bank’s strategy, business model, and risk management framework. These topics are prioritised based on their relative importance to sustainable value creation and stakeholder interests, ensuring that management focus and resources are directed towards areas of greatest significance. They also guide the evolution of the Bank’s business model across the six capitals, and influence its short-term (less than one year), medium-term (one to three years), and long-term (over three years) objectives.

By embedding both financial and impact considerations into planning, operations, and performance management, DFCC Bank ensures that material matters are systemically integrated into decision-making. This approach strengthens the resilience of the Bank’s business model, and supports an effective response to evolving external conditions and stakeholder expectations.

Our Reporting Suite

DFCC Bank is committed to delivering transparent, credible, and forward-looking sustainability disclosures that reflect its integrated approach to value creation. Our reporting framework is designed to evolve continuously in response to emerging regulatory requirements, voluntary disclosures, and best practices across our listing jurisdictions and operational footprint.

Our disclosures are guided by locally and globally recognised standards, frameworks, and principles to the extent relevant to our business model and stakeholder expectations. This ensures that our reporting remains decision-useful, comparable, and aligned with international benchmarks while addressing the local context and priorities.

Through this approach, DFCC Bank reinforces its commitment to transparency, accountability, and resilience, enabling stakeholders to gain a comprehensive understanding of the Bank's sustainability performance and long-term value creation strategy.

The 2025 Integrated Annual Report aligns with the following regulatory and voluntary reporting codes

Standard/Framework/Guideline	Key Reporting Aspect	Issuance Body/Institution
Sri Lanka Accounting Standards (LKASs/SLFRSs)	Financial Reporting	The Institute of Chartered Accountants of Sri Lanka
Sri Lanka Accounting and Auditing Standards Act No. 15 of 1995	Financial Reporting	The Institute of Chartered Accountants of Sri Lanka
Companies Act No. 07 of 2007 and its amendments thereto	Financial Reporting, Corporate Governance	Registrar of Companies
Listing Rules of the Colombo Stock Exchange	Financial Reporting, Non-Financial Reporting, Corporate Governance	Colombo Stock Exchange
Banking Act Directions No. 01 of 2016 on Capital Requirements for Licensed Commercial Banks	Corporate Governance	Central Bank of Sri Lanka
Banking Act No. 30 of 1988 and amendments thereto	Corporate Governance	Central Bank of Sri Lanka
Banking Act Directions No. 05 of 2024 on Corporate Governance	Corporate Governance	Central Bank of Sri Lanka
Code of Best Practice on Corporate Governance 2023	Corporate Governance	The Institute of Chartered Accountants of Sri Lanka
Securities and Exchange Commission of Sri Lanka Act No. 19 of 2021, including directives and circulars	Corporate Governance	The Securities and Exchange Commission of Sri Lanka
International Integrated Reporting <IR> Framework 2021	Integrated Reporting	International Integrated Reporting Council (IIRC) – Now part of the IFRS Foundation
Banking Act Directions No. 05 of 2022 on Sustainable Finance Activities	Sustainability Reporting	Central Bank of Sri Lanka
Sustainability Accounting Standard for Commercial Banks | Industry Standards Version 2023-12 of the Sustainability Accounting Standards Board (SASB)	Sustainability Reporting	Sustainability Accounting Standards Board | IFRS Foundation
SLFRS S1 and S2 Sustainability Disclosure Standards	Sustainability Reporting	The Institute of Chartered Accountants of Sri Lanka
IFC's Performance Standards on Environmental and Social Sustainability	Sustainability Reporting	International Finance Corporation
Global Reporting Initiative (GRI) Standards	Sustainability Reporting	Global Sustainability Standards Board
United Nations Sustainable Development Goals (SDGs)	Sustainability Reporting	United Nations
Ten Principles of the United Nations Global Compact	Sustainability Reporting	United Nations Global Compact
Sustainable Banking Principles of the Sustainable Banking Initiative	Sustainability Reporting	Sri Lanka Bank’s Association – Sustainable Banking Initiative (SLBA-SBI)
Sri Lanka Green Finance Taxonomy	Sustainability Reporting	Central Bank of Sri Lanka
ICMA Green Bond Principles	Sustainability Reporting	International Capital Market Association
GHG Protocol Corporate Accounting and Reporting Standard	GHG Reporting	World Resources Institute
ISO 14064-1:2018 Organisation Level for Quantification and Reporting of Greenhouse Gas (GHG) Emissions and Removals	GHG Reporting	International Organization for Standardization (ISO)

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Forward-looking statements

This Report includes certain forward-looking statements relating to DFCC Bank's future financial position, performance, strategy, operations, and business outlook. These statements are inherently subject to risks, uncertainties, and assumptions, as they concern future events and depend on circumstances that may or may not occur. As a result, actual results or developments could differ materially from those expressed or implied in such forward-looking statements.

Accordingly, these statements have not been reviewed or audited by the Bank’s external auditors. The forward-looking statements presented as at 31 December 2025, at the time of releasing the Bank’s 2025 financial results, were based on management’s strategic plans and the prevailing macroeconomic forecasts available for 2026.

External Assurance

As part of our commitment to high-quality and decision-useful reporting, independent assurance was obtained to enhance the credibility and robustness of the following information disclosed in this Report:

Assurance Element	Assurance provider	Standard for Audit Engagement	Reference to the Assurance Report
Statutory audit on Financial Statements of DFCC Bank PLC and the Consolidated Financial Statements	KPMG (Chartered Accountants)	Sri Lanka Auditing Standards (SLAuSs) issued by The Institute of Chartered Accountants of Sri Lanka	Pages 297-303
Independent limited assurance on reporting adherence to the GRI standards	Ernst & Young (Chartered Accountants)	Sri Lanka Standard on Assurance Engagements (SLSAE) 3000 (Revised), Assurance Engagements other than audits or reviews of historical financial information, issued by The Institute of Chartered Accountants of Sri Lanka	Pages 517-518
Independent limited assurance on reporting adherence to the Integrated Reporting <IR> Framework	Ernst & Young (Chartered Accountants)		Pages 85-86
Independent Limited Assurance on SLFRS Sustainability related Financial Disclosures in accordance with SLFRS S1 and S2	Ernst & Young (Chartered Accountants)		Pages 161-162
The Directors’ Statement on Internal Control	KPMG (Chartered Accountants)	Sri Lanka Standard on Assurance Engagements (SLSAE) 3050 (Revised), Assurance Report for Banks on Directors’ Statement on Internal Control, issued by The Institute of Chartered Accountants of Sri Lanka	Pages 291-292
Independent Practitioners’ Limited Assurance Report on the Report on certain information included in the Green Bond 2024 Report of DFCC Bank PLC	KPMG (Chartered Accountants)	Sri Lanka Standard on Assurance Engagements (SLSAE) 3000 (Revised), Assurance Engagements other than audits or reviews of Historical Financial Information, issued by The Institute of Chartered Accountants of Sri Lanka	Pages 519-521

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Board Responsibility Statement

The Board of Directors of DFCC Bank PLC confirms that the 2025 Annual Report has been prepared and presented in accordance with the International Integrated Reporting Framework and acknowledges its responsibility for ensuring the integrity of this integrated report. Accordingly, the Board is satisfied that the presentation of information with regard to the Bank’s strategy and value creation addresses material matters relevant to the Bank and its stakeholders. The Board has considered the completeness of the information presented in the report based on the combined assurance process outlined above.

Signed by the Board of Directors,



J Durairatnam
Chairman



N H T I Perera
Director/CEO



Ms L K A H Fernando
Director



N K G K Nemmawatta
Director



H A J de S Wijeyeratne
Director



N Vasantha Kumar
Director



Ms A L Thambiayah
Director



P A Jayatunga
Director



I A Wickramasinghe
Director



Ms A K Moonesinghe
Director



Ms N Ranaraja
Company Secretary

OUR RECENT INTEGRATED ANNUAL REPORTS


2022
2024
2023

Visit the Annual Reports page on the DFCC Bank website: https://www.dfcc.lk/investor/reports/annual-reports

or Scan this QR code to view DFCC Bank Annual Reports



Your Feedback Matters

We welcome comments, feedback, and requests for clarification from our stakeholders in relation to this Annual Report. Please direct your correspondence to:

Company Secretary

DFCC Bank PLC
73/5, Galle Road
Colombo 03
Sri Lanka

Phone: +94 11 244 2442

Email: care@dfccbank.com

Website: www.dfcc.lk

Six Capitals


Financial Capital

Manufactured Capital

Intellectual Capital

Human Capital

Social and Relationship Capital

Natural Capital
Content Elements of the Integrated Report


Organisational Overview

Business Model

Strategy

Governance

Risk Management

Operating Context
Sustainability-related Disclosures

Sustainability Strategy
SLFRS Sustainability-related Financial Disclosures based on SLFRS S1 and S2
Materiality
Commitment to our Stakeholders
Sustainability Accounting Standards Board (SASB) Disclosures
Global Reporting Initiative (GRI) Index
Green Bond 2024 Report
Blue Bond 2025 Report
Stakeholders


Investors

Customers

Employees

Regulators, Government Institutions, and Industry Associations

Suppliers and Service Providers

Community