The Hole Diameter for round PTH terminal leads is Max Lead Diameter X 0.20 mm. 

The Hole Diameter for rectangle PTH terminal leads is Max Lead Diameter X 0.15 mm. 

The annular is proportional. 

A 1.00 mm hole = 1.50 mm pad = 0.25 mm annular ring.

A 2.00 mm hole = 3.00 mm pad = 0.50 mm annular ring. 

A 3.00 mm hole = 4.50 mm pad = 0.75 mm annular ring. 

The Minimum Annular Ring of 0.40 is very robust for tiny PTH packages with fine wire terminal leads (like watch crystals). The pad size would be excessive. 

Minimum is intended for the smallest terminal lead and hole like a Tuning Fork Crystal. 

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the terminal lead diameter is 0.20 mm and the hole size would be 0.40 mm diameter. A 0.40 minimum annular ring would be a 1.20 mm pad diameter. 

The pin pitch is only 0.45 mm. 

This is an example where a 0.40 mm minimum annular ring would be too robust. Too much solder for a tiny hole.