CIMB GROUP HOLDINGS BERHAD 195601000197 (50841-W)

CIMB GROUP HOLDINGS BERHAD

ANNUAL REP ORT 2019

PERFORMANCE
Strong balance sheet
FORWARD23 and top line growth
across the region
Great strides through Page 18
Group-wide
implementation
with over 500
strategic projects
Page 16

[Link]

SUSTAINABILITY
Embedded economic,
environmental and social
considerations into our
operations and
lending policies
Page 17
ANNUAL REPORT 2019

CUSTOMER TECHNOLOGY VENTURES &

CENTRICITY & DATA OUR PEOPLE PARTNERSHIPS SUSTAINABILITY
ADVANCING CUSTOMERS AND SOCIETY
 Our covers showcase
CIMB's focus on putting our
customers at the heart of
everything we do,
future-proofing our business
and shaping a sustainable
future. Through adapting to
a dynamic and complex
ecosystem, we strive to
create value and advance
our customers and society. View our Annual Report, Accounts and
other information about
CIMB Group Holdings Berhad at

[Link]
 Annual
Report
2019

We have taken conscious effort to manage and

minimise the environmental impact of our annual report
and related processes.

The total carbon footprint for

Printed with eco ink the 3 books of CIMB Annual
There is approximately
made from higher Report 2019 is 25% reduction in
percentage of vegetable
oil to reduce emission of
7.495 kgCO2e. We are paper used,
committed to reducing the
volatile organic environmental impact of our 276,900
compounds (VOCs). annual report and will less sheets in the
Contains low level of continue working to reduce printing and production
chemical, thus less the amount of greenhouse of CIMB Annual
pollution to the gases (GHG) emitted Report 2019.
environment throughout throughout the entire
the printing process. designing and
printing process.

Printed with carbon Paper sourced from Paper and printing

neutral press responsibly wastes are being

machines, eco managed responsibly

materials and managed
forests that provide handled to recycle
environmental benefits. and up-cycle materials
under and certified with
Covers are printed on in order to reduce the
ISO14001:2015 250gsm Arctic Volume High burden on landfills.
environmental White (FSC Mix) paper;
management system to
minimise environmental Inner pages are printed on
impact. 100gsm Munken Polar
Rough (FSC Mix) paper.
about

“In fulfilling our purpose of advancing customers and society, we remain

committed to championing growth, with responsibility towards our multiple
stakeholders across ASEAN. At CIMB Group, we are cognisant of the need to
continuously monitor and respond to the evolving needs and expectations of our
employees, customers, suppliers and partners, investors, as well as the
regulators and policy-makers. Therefore, our Annual Report is also maturing in
terms of our narratives for both shareholders and stakeholders alike. We are
going beyond operational efficiencies and financial performance, to speak of our
ability and perseverance to create value that is meaningful for everyone.
‘FutureForward’ is our commitment to future-proof our business, our people and
our collective ASEAN aspirations.”

R E P O R T I N G S C O P E A N D B O U N DA R I E S M AT E R I A L I T Y D E T E R M I N AT I O N

This Annual Report covers our financial and non-financial All our Annual Reports present a balanced and accessible
performance during the period 1 January 2019 to 31 December assessment of our strategy, performance, governance and
2019. prospects.

Through this report, it is our sincere effort to keep our stakeholders The various issues and developments included in the 2019 edition
abreast of key developments; programmes and initiatives; market were determined by a range of considerations, such as quantitative
challenges and business solutions; our achievements; mid- to and qualitative criteria; issues likely to impact our ability to achieve
long-term direction; and the overall health of operations in 2019 in strategic objectives and remain sustainable; matters covered in
various geographical markets where we operate. reports presented to our Board of Directors; the risks identified by
our risk management team; and the interests of our key
The report also presents rich insights and forward-looking stakeholders. We also consider factors that affect the economic
statements on financial position and performance in the year and social environment in various countries and regions where we
ahead. conduct business.

Our report is particularly relevant for our stakeholders in the ASEAN

markets of Malaysia, Indonesia, Singapore, Thailand, Brunei, S TAT E M E N T O F T H E B OA R D O F D I R E C T O R S O F
Cambodia, Myanmar, Vietnam and Laos. A range of other CIMB GROUP HOLDINGS BERHAD
stakeholders across the globe will also find our report informative.
The Board acknowledges its responsibility to ensure the integrity
Our financial statements are independently audited and provide of the Annual Report. In the Board’s opinion, the report addresses
in-depth and transparent disclosure of our financial performance. all material issues and matters and fairly presents the Group’s
performance for the year 2019.
Unless we indicate otherwise, all the data presented relates to the
Group, which includes our banking operations and our subsidiaries. Approved by the Board of Directors and signed on behalf of the
Board:
In preparing our report, we were guided by the requirements of
local and international statutory and reporting frameworks,
including those of Bursa Malaysia.

Datuk Mohd Nasir Ahmad Tengku Zafrul
Chairman Tengku Abdul Aziz
Group Chief Executive Officer/
Executive Director
 CIMB GROUP HOLDINGS BERHAD

View our Annual Report, Accounts and other information about CIMB Group Holdings Berhad at [Link]

  what’s inside this report

2 About This Report PERFORMANCE REVIEW STRUCTURE & LEADERSHIP SUSTAINABILITY
STATEMENT
68 Board of Directors
144 Sustainability Statement
70 Board of Directors Profile

74 Group Company
HIGHLIGHTS AND
Secretary’s Profile
ACHIEVEMENTS
75 Corporate Structure
163 Regional Notable Deal
76 Board of Major
4 Message from the 32 Group Financial Review by 167 Notable Achievements
Subsidiaries
Chairman Group CFO 168 Corporate Event
78 Group Shariah Committee
38 Five-Year Group Financial Highlights
OVERVIEW OF CIMB GROUP Summary 79 Group Shariah Committee
170 Media Highlights
Profile
9 Overview 39 Five-Year Group Financial
Highlights 82 Group Management
10 Profile and Presence STAKEHOLDER
40 Simplified Group 84 Group Management INFORMATION
11 Key Highlights of 2019
Statements of Financial Profile
11 Business Highlights Position 172 Shareholders’ Statistics
89 Human Capital
11 Financial Highlights 41 Quarterly Financial 175 Internal Policies,
Development
Performance Procedures and
12 Corporate Milestones and
99 Group Organisation Guidelines
Our Rich Heritage 42 Key Interest Bearing
Assets and Liabilities Structure
181 Top 10 Properties of
MANAGEMENT DISCUSSION 43 Value Added Statements CIMB Group
AND ANALYSIS CORPORATE GOVERNANCE
44 Capital Management 182 Corporate Information
STRATEGIC REVIEW 100 Chairman’s Statement on
45 Credit Ratings 184 Group Corporate
Corporate Governance
Directory 2019
48 Balance Sheet
101 Corporate Governance
Management
Overview Statement
49 Investor Relations
117 Additional Disclosures
55 Financial Calendar
120 Statement on Risk
Management and Internal
BUSINESS REVIEW
Control
14 Group CEO’s Overview 56 Group Consumer Banking
129 Risk Management
24 Economic and Banking 58 Group Commercial
Review & Outlook Banking 137 Audit Committee Report
26 Material Matters Impacting 60 Group Wholesale Banking 142 Board Shariah Committee
Our Strategy Report
62 Group Transaction
27 Key Risks and Mitigation Banking
28 The Group’s Strategy 64 Group Ventures &
Partnerships
66 Group Islamic Banking
 DATU K MOH D
NASIR AHMAD
Chairman

D E A R S T A K E H O L D E R S ,

2019 marked the completion of my one-full financial year as Chairman of CIMB Group. It was momentous
for two reasons. First, the operating environment only grew more challenging, with evolving policy focus,
regulations, socio-economic trends, and global trade relations. In a way, it gave us (and the industry)
a new impetus and motivation to innovate and look at banking of the future. Second, it was the beginning of our
five-year (mid-term) strategic roadmap Forward23. The task at hand was not just to devise a game-plan to remain
relevant and profitable, but to demonstrate greater responsibility towards managing and growing out of the
emerging risks in the coming years. It was an exciting start and I reckon that every member of CIMB Group
left no stone unturned to ensure 2019 was a year of consolidation (of our strengths) and to define and deliver
value for our multiple stakeholders.

4
the chairman
“Despite the US-China trade tensions, steady domestic demand, private consumption
and investments provided ASEAN some immunity against various uncertainties arising
from global conflicts. The banking sector remained resilient, while preparing to transition
to a digitally matured environment, where data analytics and advanced technologies
continued to enable banks towards cutting-edge customer solutions. However, global
impacts from climate change, with increasing expectations of institutional investors and
other stakeholders, banks have started to examine various economic, environmental and
social risks in their credit assessments. In the first year of its new mid-term strategy
Forward23 (2019-2023), CIMB is on track in meeting the milestones that are set in
Forward23 and has also demonstrated leadership by making absolute global
commitments to sustainable development and sustainable banking.”

5
message from the chairman

THE YEAR THAT GOVERNANCE AT

ENDED ITS BEST
Overall, the year was eventful. Regulators continued in their last The role of Boards
leg of implementation of Basel IV and MiFID II prudential reforms, becomes even more
in addition to propagating robust risk management practices and critical as the banking
internal controls. The Trumpian uncertainty definitely affected and sector is undergoing a
remains a sore point for the markets that are trade-reliant. We huge transformation.
also saw the conflicts that came with growing protectionism on All members on the
one hand and the risk of instability while open markets strived to strengthen cross- Board must have the right-level of
border partnerships to promote trade. The Fourth Industrial Revolution and competencies to not only understand but
Sustainability Leadership were the two recurring themes that necessitated the need also assess the various emerging risks in
to future-proof banks and the communities that depend on them, by optimising their the conduct of business. The Board is
potential and reinventing their business models. steadfast in its commitment to observe the
highest standards of governance in its
In the ASEAN, actors continued to accelerate efforts towards financial integration in effort to remain relevant against a backdrop
the region by balancing liberalisation initiatives with financial inclusiveness and of challenging business landscape.
stability. This also means the right balance of policy mix and digital infrastructure.
While the intensifying ASEAN integration efforts in 2019 seemed to bring the vision of During the year, we conducted several
one-big regional market closer to reality, the probable competition from non- sessions for the Board of Directors on
traditional banking institutions has also been an issue of debate. Sustainability – emphasising on physical
and transition risks and how CIMB Group
In our home market, Bank Negara Malaysia (BNM) issued the exposure draft for the can improve its preparedness into the
licensing framework for virtual banks. It has set a minimum capital fund unimpaired future. These awareness sessions helped
by losses of RM100 million, which would be gradually increased to RM300 million. the Board members acknowledge
The new-age digital banks are expected to increase access to convenient and interlinkages between risks, various capital
affordable financial solutions. The dynamics will be different. There may be new inputs (manufactured, intellectual, financial,
challenges to digital. The priority, however, will be to drive value to customers and social and relationship, human, and natural)
safeguard their interests. and the organisational performance.

Moving forward, we will witness a sea of change. Banking sector will evolve. The Following this, in 2019, we have included
operating landscape will present huge opportunities, but not without new risks. sustainability metrics as part of selected
Responsible banking practices may seem to be a tall order, but will become a norm. Senior Management’s Performance
The future of banking will take a new form and shape, with fast changing Measurement System. This also means the
demographics, high expectations of stakeholders, cautious investor sentiments, and Board members are now expected to steer
extraneous factors such as climate emergency and socio-economic and political sustainability direction, while generating
uncertainties. shareholder’ returns. This will require them
to have an oversight on forward-looking
CIMB is well-positioned in the region with its Forward23 strategic roadmap and will risks and ensure appropriate governance
demonstrate resiliency and leadership for delivering positive performance year on toward value creation for multiple
year. stakeholders to our business.

A lovely evening at Majlis Berbuka Puasa CIMB Group.

6
SUSTAINABILITY
FOR GROWTH During the year, we have made sterling better awareness on this movement. From reducing waste to
progress on all fronts. We have not only made managing events in a more sustainable manner, we aspire to create
global commitments to scale-up finance for a culture with a sense of responsibility towards our environment
sustainable development, but have pledged to and society.
leverage on our influence and the impact of
our networks to promote sustainable business In fulfilling our purpose of advancing customers and society, we
practices. We have launched Sustainable Development Goals have embarked on our sustainability journey on a strong footing.
(SDG) Bonds, Sustainability-Linked Loans and SME Renewable As we move forward, we will only accelerate our efforts towards
Energy Financing – all in our efforts to create a better future, and a responsible banking practices. We remain committed to do
better planet. everything in our capacity, together with our partners and CIMBians
to create net positive impact on the environment and the
We encourage our people to propose their ideas to contribute in communities where we operate.
CIMB’s sustainability efforts. We believe sustainability starts from
home and the simple steps we have taken are proven to provide

PEOPLE AS
CHAMPIONS
I take pride in the untiring efforts of our senior It is no surprise that our group-wide efforts had bagged us many
management and #teamCIMB in championing awards of excellence. A worthy mention would be that CIMB won
meaningful growth. And growth has many the Most Outstanding Annual Report of the Year (Platinum) by
contexts in CIMB. Financial growth that will National Annual Corporate Report Awards (NACRA) 2019,
catalyse CIMB’s journey into the future as a Sustainability Reporting Award (Gold) by NACRA 2019, and Best
formidable universal bank in the region. Retail Bank in Malaysia by the Asian Banker Excellence in Retail
Intellectual growth that will shape new highly-capable leaders of Financial Services Awards 2019. All of these could not have been
tomorrow. Personal growth that will inspire us CIMBians to take achieved without hard work, dedication, and high spirits from
pride in what we do, and all that we represent as a leading #teamCIMB.
credible bank.

As we move forward, growth is imminent. Risks to growth are

inevitable. Future-proof strategies are critical. Responsibility is a
pre-condition to everything. And people are the champions, the
catalysts to all growth. Therefore, at CIMB, it is our utmost priority
to keep our people engaged and motivated at all times. I strongly
believe that our people are our
partners in growth. We
encourage them to participate in
our journey, co-opt and co create
ideas, programmes, and
solutions, which will give us not
just a competitive advantage but
a differentiated positioning in the
eyes of our stakeholders.

We uphold our CHIDA values

dearly in our pursuit of creating a
better CIMB. Customer
Obsessed, High Performance,
Integrity, Diversity & Inclusion and
Agility are the ingredients that
reflect our commitment towards
enabling our customers to
achieve their dreams, goals and
Leadership engagement session at INSEAD Singapore Campus.
aspirations.

7
message from the chairman

FUTURE
FORWARD
As a big brand, we must be prepared to face
all challenges in the future. We must grow
and progress responsibly. I cannot
emphasize enough how serious we are in
upholding integrity which is the pillar of good
governance. We do not tolerate corrupt
practices. Guided by the MACC Act 2018, CIMB has put in place
adequate procedures which include Anti-Bribery and Corruption
Policy, No Gift Policy, Whistleblowing-Policy, and other related
policies and procedures. Business success is very much
dependent on good corporate governance. The Board is very
mindful of the need to consistently ensure that overall best
practices are in place.

As announced by BNM, CIMB has been identified as one of the

Domestic Systematically Important Banks (D-SIBs). The D-SIBs
Framework that will come into effect on 31 January 2021 plans
to mitigate the “too-big-to-fail” challenges by having to maintain
higher capital buffers to meet regulatory requirements. This At the Group Annual Management Summit in November 2019.
signifies the need for a heightened effort to ensure CIMB
continues to be a strong and significant component of the
financial system of the country. This is a responsibility that CIMB
will be proud to shoulder. FINAL
REMARKS
Before concluding I would like to take this
opportunity to express my gratitude to
the Board Member who has stepped
down, Mrs. Tongurai Limpiti, for her
services to the Board of CIMB Group. To
my colleagues on the Board and the
subsidiary Boards, I am thankful for your invaluable guidance,
outstanding services and far-sighted visions.

On behalf of the Board, I would also like to record my

appreciation to our stakeholders, business partners,
customers, suppliers, and regulators for the unshaken
confidence and support over the years.

Special thanks go to #teamCIMB for their tireless

commitment and hard work, and the CIMB Management led
by the Group CEO, Tengku Dato’ Sri Zafrul Tengku Abdul Aziz
Hosted The Cooler Earth Sustainable Finance Summit in October 2019. for steering the Group towards becoming a high-performance
organisation.

2020 starts a new decade. Let us keep our spirits high and
continue developing a highly skilled, talented and united
#teamCIMB.

Members of the Board of CIMB Cambodia paid a courtesy visit to His Excellency Datuk Mohd Nasir Ahmad
Chea Chanto (fourth from the right), the Governor of the National Bank of Chairman
Cambodia.

8
 overview

A DVA N C I N G CU S TO M E R S A N D S O C I E T Y
OUR PURPOSE
We place our customers at the heart of everything we do.
STATEMENT
The 4th Industrial Revolution is upon us and as we strive to be the disruptor and not the disrupted, we will
not limit ourselves to the boundaries of banking as we know it today.

We advocate sustainable practices, both for ourselves as an organisation and our customers as we
progress forward.

OUR VALUES CUSTOMER HIGH INTEGRITY DIVERSITY AND AGILITY

OBSESSED PERFORMANCE We’re always INCLUSION We must respond
We are here for We always strive to honest, We believe quickly to change
our customers, to go above and responsible and everyone has and be problem
ensure they’re beyond in accountable in something to solvers.
happy and everything we do. everything we do. contribute,
satisfied. Be vigilant, be regardless of race,
alert, be thorough. gender or
opinions.

CIMB is a leading ASEAN universal bank, one of the largest

investment banks in Asia and one of the largest Islamic banks
in the world.

T O T A L A S S E T S M A R K E T N E T P R O F I T
C A P I T A L I S A T I O N

RM573.2 RM51.1 RM4.56

billion billion billion

COMPANY NAME STOCK NAME STOCK CODE

CIMB SHARE CIMB GROUP HOLDINGS CIMB 1023

INFORMATION BERHAD (Bursa Malaysia)

TICKER CODE FINANCIAL SHARE REGISTRAR

YEAR END BOARDROOM SHARE
CIMB: MK REGISTRARS SDN. BHD.
(199601006647 (378993-D)
(Bloomberg) 11th Floor, Menara Symphony
No. 5 Jalan Prof. Khoo Kay Kim
[Link] Seksyen 13, 46200 Petaling Jaya
(Reuters) 31 DECEMBER Selangor, Malaysia

9
profile

CIMB Group is a leading ASEAN universal and services. It is the fifth largest banking RM573.2 billion, with total shareholders’
bank and one of the region’s foremost group by assets in ASEAN and, as at the funds of RM56.2 billion and total Islamic
corporate advisors. It is also a world leader end of 2019, had around 35,000 staff and assets of RM133.5 billion. At the end of
in Islamic finance. over 15 million customers. 2019, the substantial shareholders were
Khazanah Nasional Berhad with 23.77%,
The Group is headquartered in Kuala CIMB Group Holdings Berhad has been Employees Provident Fund with 12.67%,
Lumpur, Malaysia, and offers consumer listed on the Main Market of Bursa Malaysia Permodalan Nasional Berhad with 12.20%
banking, commercial banking, wholesale since 1987 and has market capitalisation of and Kumpulan Wang Persaraan
banking, Islamic banking, wealth RM51.1 billion as at 31 December 2019. (Diperbadankan) with 5.90%.
management and digital payment products Total assets at the end of 2019 were

ASEAN MARKETS
• Malaysia
• Indonesia
• Thailand
• Singapore
15
Countries
• Cambodia
• Laos
• Brunei
• Vietnam
• Myanmar
• Philippines
702
Retail Branches
OTHER MARKETS
• China & Hong Kong
• United Kingdom Around

35
• India*
• Korea*
• United States of America* k
Staff
* Via CGS-CIMB Joint Venture

  CIMB BANK   CIMB INVESTMENT BANK   CIMB BANK PLC

CIMB Bank is the Group’s commercial CIMB is the Group’s investment banking CIMB Cambodia is the Group’s banking
bank in Malaysia with 234 branches across franchise which operates in 15 countries franchise in Cambodia, with 14 branches
the country. It has subsidiaries in Thailand, across Asia Pacific. CGS-CIMB Securities, a across the country. It offers a wide range of
Cambodia and Vietnam, as well as joint-venture with China Galaxy International, banking products and services for
branches in Singapore, Philippines, is the stockbroking arm for the Group individuals, businesses and corporates.
London, Hong Kong, Shanghai and Laos providing institutional and retail equity
and representative offices in Yangon and broking services and equities research.
Mumbai.   CIMB BANK VIETNAM

  CIMB THAI BANK CIMB Bank (Vietnam) Limited is the

  CIMB NIAGA Group’s banking franchise in Vietnam.
CIMB Thai is the Group’s banking franchise Headquartered in Hanoi and with a branch
CIMB Niaga is the Group’s banking in Thailand. It has been listed on the Stock in Ho Chin Minh City, it offers a wide range
franchise in Indonesia with 376 branches Exchange of Thailand and is the seventh of banking products and services for
across the archipelago. It has been listed largest commercial bank in Thailand by individuals, businesses and corporates.
on the Indonesia Stock Exchange since assets, with 69 branches nationwide and
1989 and is the sixth largest bank in one overseas branch in Vientiane, Laos.
Indonesia by assets at the end of 2019.   CIMB BANK PHILIPPINES

  CIMB ISLAMIC CIMB Bank Philippines was launched in

2018 and is recognised as a leading digital
CIMB Islamic is the Group’s Islamic banking franchise in ASEAN. The all-digital
banking and financial services franchise, mobile-first retail banking proposition
with an extensive suite of innovative scaled rapidly to 1.7 million customers in its
Shariah-compliant products and services. first year of operations.
It operates in parallel with the Group’s
universal banking platform.

10
 key highlights

BUSINESS HIGHLIGHTS

FORWARD23 TECHNOLOGY & DATA SUSTAINABILITY

2019 was the first year into our five-year In response to rapid digitalisation, the In keeping with our sustainability
Forward23 journey. Our focus during evolving technology landscape, as well agenda, we embedded economic,
the year has been to establish a as the growing expectations of a new environmental and social (EES)
governance framework to ensure generation of digital-savvy customers, considerations into our operations and
portfolio oversight and delivery of the the Group focussed on enhancing the lending policies. In addition to rolling out
set objectives. We have made great core resiliency of our systems as well as our Group Sustainability and
strides through Group-wide to develop innovative new products and Sustainable Financing Policies, we also
implementation of 21 programmes and solutions to future proof ourselves. made global commitments and
over 500 projects. delivered sustainable product solutions
Refer to Group CEO’s Overview page 17. locally.
Refer to Group CEO’s Overview page 16.
Refer to Group CEO’s Overview page 17.

PEOPLE DEVELOPMENT CUSTOMER CENTRICITY VENTURES & PARTNERSHIPS

In preparing our workforce for the To strengthen our customer centricity, As a young business division setup in
Fourth Industrial Revolution, we we set-up our Transforming Customer 2019, the aspiration is to develop the
invested in upskilling over 2,200 Journeys (TCJ) department. The Group’s new and disruptive businesses
employees in the 3D related skills of objective is to take a fresh approach to and value creation streams. During the
data, digital, and design. We also designing the end-to-end journey for year, we successfully established
developed a roadmap to accelerate our customers within an agile design baseline narratives across our practices
towards achieving a 2023 target of at and delivery ecosystem. We also made and started identifying disruptive levers
least 30% of 3D talent in #teamCIMB. NPS our key headline target for to accelerate over the next 5 years.
Forward23.
Refer to Group CEO’s Overview page 17. Refer to Group Ventures & Partnerships page
Refer to Group CEO’s Overview page 16. 64.

FINANCIAL HIGHLIGHTS

OPERATING INCOME GROSS LOANS TOTAL ASSETS NET PROFIT

RM17.8 billion RM369 billion RM573.2 billion RM4.56 billion

ROE DEPOSITS FROM CUSTOMERS^ TOTAL CAPITAL RATIO GROSS DIVIDEND PER SHARE

8.5 % RM402 billion 16.8 % 26 sen

^ Include investment accounts of customers and structured investments classified as financial liabilities designated at fair value through profit or loss and other liabilities

11
 corporate milestones

Pertanian Baring Sanwa Bank of Commerce merges with CIMB lists on Bursa Malaysia.
1974 Multinational Bank (PBSM)
established in Kuala Lumpur
1991 United Asian Bank. In a major
restructure, the merged banks
2003 The listing lasts only three years
and delivers returns of 340% to
and launched by Prime Minister become Bank of Commerce shareholders.
Tun Abdul Razak Hussein. (Malaysia) Berhad, under holding
company Commerce-Asset
Holding Berhad (CAHB). CIMB
becomes a separate CAHB
subsidiary.

CIMB acquires GK Goh

PBSM changes name to 2005 Securities in Singapore. In a
1986 Commerce International
Merchant Bankers Berhad
major corporate restructure to
create a universal bank, CIMB
(CIMB) after acquisition by Bank acquires sister company
of Commerce. Bumiputra-Commerce Bank
from holding company CAHB.
Bank of Commerce (Malaysia) Holding company CAHB is
1999 Berhad merges with Bank
Bumiputra Malaysia Berhad to
renamed Bumiputra-Commerce
Holdings Berhad.
form Bumiputra-Commerce
Bank Berhad.

CIMB acquires Southern Bank.

2006 The new-look CIMB Group
launches in the presence of the
Bank of Commerce successfully
1987 lists on Bursa Malaysia.
Malaysian Prime Minister Dato’
Sri Abdullah Ahmad Badawi.

CAHB takes a majority stake in

2002 Indonesia’s PT Bank Niaga Tbk.
2008
CIMB Niaga established through
a merger between Bank Niaga
and Bank Lippo. CIMB Group
acquires BankThai and the
following year renames it CIMB
Thai.

12
 CIMB Group launches retail CIMB opens its first branch in CIMB Group, as a Founding
2009 banking operations in
Singapore. CIMB Group
2016 Vietnam. This 100% owned
subsidiary allows CIMB to
2019 Member of the United Nations
Environment Programme
acquires a 19.99% stake in the establish its presence in the Finance Initiative Principles for
Bank of Yingkou, China. Holding country as a universal banking Responsible Banking (PRB),
company BCHB is renamed as platform and strengthen its makes a public commitment to
CIMB Group Holdings Berhad. banking franchise in ASEAN. mobilise and influence its
networks towards sustainable
business and lifestyle practices.
The Group launches a 5-year
sustainability roadmap to realise
CIMB's priority UN Sustainable
CIMB Group launches banking
2010 operations in Cambodia,
bringing retail banking presence
Development Goals and held
our inaugural The Cooler Earth
Sustainability Summit 2019.
to five ASEAN nations –
Malaysia, Indonesia, Singapore,
Thailand and Cambodia.

CIMB and China Galaxy

CIMB Group starts the

2017 Securities Group become 50:50

2012 acquisition of most of the Asia

Pacific cash equities and
shareholders in CIMB Securities
International Pte, Ltd.,
repositioning CIMB’s
associated investment banking stockbroking business as a pure
businesses of the Royal Bank of play broker with the client base
Scotland, and expands or adds of a universal ASEAN bank.
operations in Sydney, CIMB received approvals from
Melbourne, Hong Kong, London 2018 the Bangko Sentral Ng Pilipinas
(BSP) to establish and operate
and New York. CIMB Group
acquires SICCO Securities, a its banking business in the
Thai stock-broking company. Philippines. With these
approvals, CIMB Bank
Philippines Inc, launched its
digital retail banking business in
December 2018 establishing
CIMB’s presence in all 10
CIMB Group completes its Asia
2013 Pacific investment banking
platform with new operations in
ASEAN countries.

Taiwan and India and Korea. The

Group moves into its new
40-storey headquarters in
Menara CIMB, located at the
high-tech hub of Kuala Lumpur
Sentral.

13
 group CEO’s

TE NG KU DATO’ S RI Z A FRUL
TENGKU ABDUL AZIZ
Group Chief Executive Officer

D E A R S H A R E H O L D E R S ,

In our previous annual report, I described 2018 as “a rollercoaster year”. In contrast, while 2019 displayed an easing of
negative sentiments, uncertainty was still a prevailing theme. Notably, US and China remained antagonistic in their
trade war with no clear resolution in sight, while interest rate cuts by the central banks of several ASEAN countries led
to a compression of margins in the financial sectors of the affected countries.

As a financial institution with a presence in all 10 ASEAN countries, CIMB was not spared from these macroeconomic
tensions. However, despite these headwinds, the Group was able to weather the uncertainties and meet our key 2019
targets, thanks to the focus and the collective effort of #teamCIMB to deliver nothing but excellence. This outcome
would not have been possible without the relentless support of our key stakeholders – the Chairman and the board,
our regulators, our customers, and you, our shareholders.

2019 was also the year we launched our Forward23 mid-term growth strategy centred on five strategic pivots, namely
Customer Centricity, Sustainability, Ventures & Partnerships, Technology & Data, and our People. With the completion
of the first year of Forward23, the Group will maintain our momentum and look forward to the successful delivery of all
our mid-term growth targets, in spite of the uncertain outlook due to the ongoing COVID-19 outbreak, as well as other
socio-political and macroeconomic challenges.

14
THE YEAR IN
REVIEW In many respects, 2019 saw a A little closer to home, interest rate cuts by the
protraction of the geopolitical and central banks of our three largest markets –
economic uncertainties that weighed Malaysia, Indonesia, and Thailand, with a joint GDP
down the preceding year. The of over USD2 trillion – had a direct impact on
US-China trade war involving the CIMB’s 2019 revenues. Combined with additional
two largest economies in the world investment spend to future proof the organisation,
and ASEAN’s largest trade partners, the Group missed our cost-to-income ratio (CIR)
showed no signs of abating. In January 2020, these target; 53.4% on a business-as-usual (BAU*) basis
tensions were temporarily put on hold as the two against a target of 52.6%.
countries signed a “Phase One” trade deal, but not
before the standoff had already disrupted supply Despite these challenges, we were able to meet all
chains and capital markets worldwide. On the our other key 2019 targets. ROE came in at 9.3%,
European front, multiple rounds of negotiations and which was within target. We also ended the year
a change in the UK Prime Minister culminated in the better capitalised with a Common Equity Tier 1
Brexit withdrawal agreement being signed on 24 (CET1) ratio of 12.9%, up from 12.5% in 2018.
January 2020, with talks due to begin over the Meanwhile, gross loans grew 6.7% year-on-year
future relationship between the UK and the EU. (YoY), outperforming the industry in Malaysia,
These ongoing uncertainties have stalled many Singapore and Thailand. These results are indeed a
major economic decisions, resulting in a global testament to the Group’s resiliency in the face of
slowdown. external pressures and proof positive that our
Forward23 strategy is already bearing fruit.

* BAU basis: Excluding FY18 gain from the sale of CPAM and CPIAM of RM928 million,
as well as excluding FY19 transformational costs (net of tax) of RM270 million, impairment
and write off of intangible assets of RM277 million, and tax and MI of RM92 million.

15
group CEO’s overview

With the Chairmen and Board of Directors of CIMB related companies at the 2019 Regional Directors’ Sharing Session.

F O R WA R D 2 3

CIMB has now started our second year of the five-year Forward23
FY19
journey. Our focus for the first year was to establish a governance
Actual vs Targets FY19 Target*
framework to ensure portfolio oversight and delivery of Forward23.
By the end of 2019, we defined 21 programmes throughout the
ROE 9.3% 9.0-9.5% ✔
Group, with over 500 projects launched across multiple
geographies and divisions. We have made some great strides,
which I will summarise in terms of the five strategic pivots that drive Dividend Payout Ratio 50.9% 40-60% ✔
our Forward23 plan.

CUSTOMER CENTRICITY Total Loan Growth 6.7% 6.0% ✔

In our efforts to become a more customer-centric organisation, we
set up our Transforming Customer Journeys (TCJ) department in Loan Loss Charge 0.44% 0.40-0.50% ✔
2019. TCJ is tasked to take a fresh approach to designing the
end-to-end journey for our customers within an agile design and CET1 (CIMB Group) 12.9% >12.0% ✔
delivery ecosystem. To date, the TCJ team has worked on several
high priority customer journeys, including Commercial lending,
Consumer deposits as well as auto finance in Malaysia and Cost-to-income 53.4% Flat (52.6%) ✘
Indonesia. In addition, the Group continues to improve upon the
robustness of tracking and monitoring customer experience Notes:
metrics, via customer satisfaction score (CSAT) and net promoter * Excludes transformational cost (net of tax) of RM270 million; Impairment and
score (NPS). Furthermore, we have made NPS a key headline target write off of intangible assets of RM277 million and Tax and MI of RM92 million

for Forward23, underscoring our aspiration to be a company that is

truly obsessed about our customers.

16
SUSTAINABILITY

Last year, we increased our focus on sustainability initiatives

throughout the Group. Out of the 17 UN Sustainable Development
Goals (SDGs), we prioritised seven against which we will map our
programmes, performance measures, and net impact. To embed
an economic, environmental, and social (EES) lens into our
operations and lending policies, we rolled out our Group
Sustainability Policy and Sustainable Finance Policy. Notably, we
also hosted The Cooler Earth Summit, CIMB’s inaugural
sustainability conference which attracted 1,200 participants, as well
as launched a US$680-million SDG bond, the first in international
capital markets by an ASEAN issuer. Additionally, we introduced a
variety of attractively-priced green products such as auto finance
for hybrid vehicles, mortgages for Green Building Index or GBI-
certified homes, and Renewable Energy Financing for MSMEs Participated in a panel session at CIMB’s inaugural The Cooler Earth Summit
(micro, small, and medium enterprises). Through these efforts and which attracted 1,200 participants.
more, CIMB’s rank on the Dow Jones Sustainability Index (DJSI)
– which rates companies in terms of environmental, social, and
governance (ESG) practices – rose from the 19th to the 51st
percentile in 2019, well on our way of achieving our aspiration of OUR PEOPLE
75th percentile by 2023. Thus far, over 2,200 employees across the Group had been trained
in the 3D related skills of data, digital, and design. A roadmap was
VENTURES & PARTNERSHIPS also developed to accelerate this journey, setting us firmly on the
One of the immediate actions of Forward23 was the setting up of a path of achieving a 2023 target of having at least 30% of 3D talent
new business division, namely Group Ventures & Partnerships. With in #teamCIMB; this was revised upwards from 15% initially as we
regards to partnerships, we opened new revenue streams through recognised the importance of having a workforce that is prepared
products such as merchant financing within the Lazada and for the Fourth Industrial Revolution. The Group also refreshed our
Shopee platforms in Malaysia, with plans to scale throughout the corporate values to align with our Forward23 priorities, the values of
region. Meanwhile, the Touch n’ Go (TnG) eWallet – an offering from which are being Customer obsessed, having a High performance
our TnG Digital joint venture with Ant Financial – is now Malaysia’s attitude, displaying Integrity at all times, championing Diversity and
largest eWallet, with over 6.8 million registered users and 120,000 inclusion, and adapting to changes with Agility, or CHIDA for short.
merchants onboarded by the end of 2019. Meanwhile, CIMB
Philippines acquired over 1.7 million users in its first year of
operation, making it one of the fastest growing banks in ASEAN. It
is also recognised as the strongest standalone digital bank in the
Philippines, clinching the Best Digital Bank awards from The Asian
Banker and also Global Finance. Our Vietnam outfit, on the other
hand, had completed its Phase 1 recalibration, pivoting towards
becoming a pure digital bank.

TECHNOLOGY & DATA

To keep pace with today’s rapidly digitalising business landscape,

financial institutions must invest in technology. In 2019, the Group
focussed on enhancing the core resiliency of our systems as well as
to develop innovative new products and solutions to future proof
ourselves. In particular, our Indonesian and Thailand offerings went
from strength to strength this year, with CIMB Niaga’s Go Mobile
being awarded “Best Mobile App” for the second year running by Serving Nacho snacks to #teamCIMB during Staff Appreciation Day, a day to
celebrate the contribution and perseverance of colleagues in CIMB.
The Asian Banker. In Malaysia, we rolled out our enhanced Clicks
mobile banking application and also successfully concluded our
1Platform refresh. In addition, the Group Technology division
completed a baselining exercise for Malaysia, taking stock of our
technology environment to subsequently develop a comprehensive
roadmap for remediation and modernisation. This initiative is
currently ongoing in Thailand, Singapore, Indonesia, and
Cambodia.

17
group CEO’s overview

FINANCIAL PERFORMANCE

The Group performed well in 2019, reporting a BAU operating income of RM17.8 billion for
the year, a respectable 8.2% YoY growth on the back of improved non-interest income
(NOII) which was 12.9% higher YoY due to improved trading activity and 6.3% increase in
net interest income (NII) mainly driven by 6.7% loan growth. Operating expenses increased
9.8% YoY mainly from investments across all businesses as well as incremental Forward23
expenses, resulting in a CIR ratio of 53.4%. Excluding these incremental investment costs,
CIR would have been 50.3%. Asset quality remains sound with a full year loan loss charge
coming in at 0.44%, within the FY19 target. Nevertheless, despite the unfavourable market
conditions, the Group was able to report a PBT growth of 5.5% YoY. This enabled us to
achieve an ROE of 9.3%, within the target for 2019. CET1 ratio improved to 12.9% (c.f.
Loans by Country
12.5% in 2018), while net earnings per share (EPS) was 51.7 sen.
Others
The Group’s balance sheet strengthened as gross loans increased by 6.7% YoY, Singapore 5%
outgrowing the Malaysian, Thai and Singaporean markets. Meanwhile, deposits were 5.8% 8% Malaysia
60%
higher YoY with the Group’s CASA ratio improving to 34.4%. Below is a snapshot of the Thailand
yearly financial performance for the years ended 2015 to 2019, as well as loans 10%
performance by country: 31 December
2019#
Yearly Earnings Trend RM369.5 billion
(RM’billion)
Indonesia
9.8% 9.6% 17%
9.3%
8.0%
6.8%
17.6 17.8
16.1 16.5
15.4

Loan Growth by Country

6.1 6.3 6.6
4.6 3.4 4.9 4.5 4.7 5.0
3.6
Loan Growth by
Country YoY~
2015 (BAU) 2016 2017 2018 (BAU) 2019 (BAU) Malaysia +6.0%
Operating income PBT Net profit ROE Thailand ^
+6.1%
Notes: Indonesia ^
+3.0%
2015: E xcluding IB restructuring cost (RM202 million); Excluding MY MSS cost (RM316 million) and tax on MY
MSS (RM79 million); Excluding ID MSS cost (RM166 million) and tax and MI on ID MSS (RM44 million) Singapore^ +3.7%
2018: Excludes CPAM & CPIAM gain (RM928 million)
Others* +21.9%
2019: E xcludes transformational cost (net of tax) of RM270 million; Impairment and write off of intangible
assets of RM277 million and Tax and MI of RM92 million Group~ +5.5%

Notes:
~ Excluding FX fluctuations
^ In local currency
# Based on geographical location of
counterparty
* Including London, Cambodia, Vietnam,
Philippines, Hong Kong & Shanghai

Chairing the CIMB Niaga’s Annual General Meeting in Jakarta, Indonesia.

18
Giving a presentation at Bank Negara Malaysia’s MyFintech Week conference.

S E G M E N TA L P E R F O R M A N C E

Consumer banking PBT declined 26.3% YoY from a combination of In 2019, Group Ventures, Partnerships and Funding (GVPF) grew
factors. Firstly, although loans grew by 9%, net interest income (NII) 22.0% mainly from the higher returns from the Group’s fixed income
was affected by NIM compression from the rate cut in Malaysia. portfolio. We invested considerably into TnG Digital, the Philippines,
2019 also saw lower bancassurance fees, higher costs, as well as and Vietnam. Meanwhile, through our stake in Principal Asset
higher provisions due to MFRS9 adjustments and normalisation of Management, assets under management (AUM) in the public
Malaysia provisions. Our Consumer business continues to be the markets continued to grow healthily, registering a strong 12.5%
largest contributor to Group PBT, at 30%. increase YoY, to end the year with an AUM in excess of RM88
billion.
Commercial banking grew for the second year running, recording
87.1% YoY PBT growth. Malaysia continued to record double digit Our Islamic banking business continued to shine, with a YoY PBT
loan growth (+12.9%), but the segment remained challenging in growth of 25.6%, resulting in a PBT of RM1.6 billion. This was driven
Indonesia, Singapore, and Thailand. Commercial NOII was buoyed mainly by our Islamic-first initiative in Malaysia and Indonesia, with
by the NPL sale in Niaga, while provisions fell as asset quality the largest contribution from the Wholesale segment (38.1% of
improved, on the back of MFRS9 writebacks and better underlying Islamic PBT) which grew 38.9% YoY.
provisions for the year.

Our Wholesale banking business grew well in 2019 with NII driven C O U N T RY P E R F O R M A N C E
by a healthy loan growth of 7.2% YoY and stronger NOII from
Our Malaysian operations performed well on a BAU basis with PBT
Treasury & Markets and trading income. PBT increased by 5.1%
improving 8.0% in 2019, driven by strong loan growth of 6.0%,
YoY, dampened considerably by provisions in Indonesia. Wholesale
better trading income, as well as the gain from the sale of our
deposit base also grew by 4.5% in 2019.
Malaysian equities business. As a result, Malaysia’s contribution to
Group PBT increased to 69% (c.f. 67% in 2018).
Group Transaction banking registered a healthy revenue growth of
5% YoY, driven mainly by Malaysia and Singapore. Across the
Indonesia saw its PBT decline by 20.2% YoY, largely due to higher
region, 2019 saw double-digit growth of 17% YoY in the number of
Corporate provisions. The sale of Niaga NPLs in 3Q19 dampened
active e-banking clients, thanks to rapid advancements in the digital
the decline somewhat.
space.

19
group CEO’s overview

Thailand continued to perform well especially in the Consumer RISK AND COMPLIANCE
segment with a PBT growth of 24.1%, underpinned by a healthy
loan growth of 6.1% YoY, sale of NPLs, as well as MFRS9 Effective risk management and risk culture are key priorities of the
writebacks. Overall, CIMB Thai’s contribution to Group PBT Group. We continue to strengthen our Enterprise-Wide Risk
improved marginally to 7%, up from 6% the year prior. Management (EWRM) framework as well as maintain our three lines
of defence model whereby business units are the first line of
Singapore’s PBT grew a commendable 18.8% YoY, driven by defence, followed by control functions such as Group Risk, Group
improved NIM and lower provisions, as well as better-than-industry Compliance and Group Finance, and finally Group Internal Audit
loan growth of 3.7%. PBT contribution to the Group remained flat Division as the third line of defence. A challenging operating
YoY at 7%. environment continued in 2019 which required the Group to
continuously assess and leverage our risk management
A special mention to our Cambodia team who reported an frameworks. Multiple initiatives were put in place to further
impressive PBT growth of 60% YoY, marking their 10th year of strengthen existing infrastructure and internal controls. For
continuous growth and winning Asiamoney’s best international example, we initiated several projects powered by machine learning
bank in Cambodia award for two consecutive years. to enable predictive prioritisation of Anti Money Laundering (AML)
alerts, to identify potential mule profiles used in money laundering,
as well as a surveillance system to identify suspicious misconduct
in treasury dealing activities.

PBT by Segment PBT by Country

Consumer Others
Singapore 2%
GVP & Funding Banking 7%
30% Malaysia
17% Thailand 69%
7%
Indonesia
15%

Wholesale
Banking Commercial
29% Banking
24%

At the CIMB Thai Townhall with Omar Siddiq (Group Chief Operating Officer)
and Adisorn Sermchaiwong (CEO of CIMB Thai).

Celebrating CIMB Singapore’s 10th year anniversary with #teamCIMB.

20
C R E AT I N G VA L U E T H R O U G H C O R P O R AT E E N H A N C I N G S H A R E H O L D E R VA L U E
RESPONSIBILIT Y
Macro and domestic economic concerns brought about a 6.0%
Our success is directly linked to the prosperity of the communities decline in the FBMKLCI Index during the year. Meanwhile, our share
and economies in which we operate. In giving back, we extended price as at end-2019 is RM5.15, a 5.1% decline from the adjusted
over RM38.4 million to various community-, education-, and share price of RM5.43 from the year before. The Group’s foreign
sports-related causes through CIMB Foundation and wider shareholding rose to 30.2% at end-2019 compared to 25.9%
Group-driven initiatives. Here are some highlights. previously.

In 2019, CIMB Foundation launched CIMB SHINE in Malaysia, a We declared a total of 26 sen per share of dividend for the year,
platform for start-ups, entrepreneurs, and SMEs to equip them with while the dividend payout for FY19 of RM2.55 billion is equivalent to
the right knowledge in finance, 4IR, and e-commerce. In 50.9% of BAU net profit for the year (BAU net profit excludes
partnership with MDEC, and Cheng & Co Accounting Firm, the transformational costs, impairments and write offs of intangible
platform delivered seven seminars across Malaysia to benefit more assets). The second interim net dividend payment of 12 sen per
than 1,000 SMEs. share will be fully paid in cash. The full-year Dividend Reinvestment
Scheme (DRS) implies an average electable portion of 50%.
Our Be$MART financial literacy programme entered its third year
with a mobile app launch, allowing users to plan their finances more Throughout 2019, CIMB’s strong performance won accolades from
effectively. The app is an extension to the 240 workshops the finance community, including:
conducted in the past three years which benefitted over 16,000 1. Best Digital Bank and Best Retail Bank in Malaysia by The
students in Malaysia. On a similar note, 2019 saw CIMB Niaga’s Ayo Asian Banker
Menabung dan Berbagi, Tour de Bank, and Leaders Camp
2. Best Digital Bank in the Philippines by The Asian Banker
programmes helping over 8,000 students from 60 schools and
universities throughout Indonesia. 3. Best Mobile Initiative, Application and Programme in Indonesia
by The Asian Banker
On the sporting front, the Group’s flagship Junior Development 4. Best Cash Management Bank and Best Equity House in
Programmes in football, cycling, and squash grew from strength to Malaysia by Alpha SEA Best Financial Institution Awards 2019
strength. In particular, our squash programme has seen the rise of 5. Best Sukuk Bank and Best Islamic Trade Finance Provider by
talents such as Ng Eain Yow and Sivasangari Subramaniam, Global Finance World’s Best Islamic Financial Institutions
globally ranked #31 and #42 respectively. Awards 2019
6. Best International Bank – Cambodia by Asiamoney Best Bank
Awards 2019

Bun Yin, CEO of CIMB Cambodia, winner of Cambodia’s Best International

Bank by Asiamoney two years in a row, serving a customer on Customer Day.

Hari Raya shopping with charity homes in Kuantan, a collaboration between 7. Best Bank for CSR – Malaysia by Asiamoney Best Bank
CIMB Foundation and Mydin Malaysia, graced by the presence of His Majesty Awards 2019
the King of Malaysia, Kebawah Duli Yang Maha Mulia Seri Paduka Baginda
Yang di-Pertuan Agong Al-Sultan Abdullah Ri'ayatuddin Al-Mustafa Billah Shah. 8. Best Customer Experience – Branch & Best Customer
Experience – Contact Centre by The Digital Banker
9. Best Bond House in Southeast Asia by Alpha SEA 13th Deal &
Solution Awards 2019

21
group CEO’s overview

M OV I N G F O R WA R D

OUTLOOK OUR FOCUS FOR 2020

Although we are only two months into 2020, we have already Despite the uncertain outlook for 2020, the Group will stay the
experienced multiple macro shocks, the most serious being the course to ensure that our Forward23 aspirations remain on track.
COVID-19 outbreak that has dominated media headlines. With This year, we intend to continue accelerating growth in Malaysia
close to 80,000 cases reported in China since January, quarantine and Indonesia, our two largest markets that collectively contribute
measures have impeded commerce and industry in “the world’s more than 80% of Group PBT.
factory”, significantly disrupting global supply chains. Travel
restrictions put in place to contain the spread of the virus has also Executing our Forward23 programmes across the 5 strategic pivots
resulted in a sharp decline in tourism, especially as Chinese will remain key in 2020, including ensuring the realisation of the
passport-holders make up about 10% of global tourists. financial benefits from our TCJ roadmap, strengthening the tech
resiliency and stability of our platforms, recalibrating our business
The impact of COVID-19 on economic activity has been felt around towards a more digitally-led model, commencing a structured
the world, with an estimated 0.2% reduction in global GDP growth. productivity programme, as well as keeping the momentum of our
ASEAN central banks have been quick to respond, with rate cuts in sustainability efforts. Additionally, the Group will continue to grow
Malaysia, Indonesia and Thailand. We expect more countries to our balance sheet prudently and keep strong controls on costs and
follow suit, in addition to supplemental budgets being announced to investments.
address slumping markets.
Our targets for FY20 are:
As a result, we have adjusted our 2020 GDP growth forecasts
accordingly, i.e. 3.6% - 3.7% in Malaysia compared to our initial FY20 Target
forecast of 4.2%. Singapore, with a greater share of foreign ROTCE* 10.8% – 11.3%
investment in GDP and higher dependence on trade, is expected to
grow only 0.3% this year. Thailand, which greets over 10 million ROE 9.0% – 9.5%
Chinese travellers annually, is forecast to grow by 1.7%. On the Dividend Payout Ratio 40% – 60%
other hand, Indonesia is less reliant on tourist dollars and is
Total Loan Growth 6.0%
expected to grow by 4.8% this year. These forecasts are based on
the assumption that the virus has its biggest impact in the first half Loan Loss Charge 0.40% – 0.50%
of this year, and that economies will rebound in the second half. CET1 (Group) >12.0%
Cost-to-income Ratio <53.4

*Note: We have introduced a new target, Return on Tangible Common Equity
(ROTCE), which is a more accurate measure to determine the efficient use
of available capital to generate profit. This excludes intangible assets and
goodwill, and is widely used by global banks. The ROTCE in 2019 was
11.3%

Celebrating CIMB Bank Philippines’ 500,000th customer milestone in August 2019. By the end of the year, we acquired over 1.7 million customers, making us one of
the fastest growing banks in ASEAN.

22
With #teamCIMB from the Customer Resolutions Unit in Kuala Lumpur, Malaysia.

AC K N OW L E D G M E N T S

In 2019, we made several changes to our leadership and IAP, especially with regards to establishing our regional footprint,
management team to become better equipped to deliver and most of all from Tun Musa Hitam, who had chaired the panel
Forward23. We welcomed the appointment of Ahmad Shahriman for the past 15 years. Our deepest gratitude to all the luminaries
Mohd Shariff as CEO of Group Islamic Banking. Internally, we who had served on the IAP.
appointed Adisorn Sermchaiwong as President and CEO of CIMB
Thai, Victor Lee Meng Teck as CEO of Group Commercial Banking On behalf of Group management, I would like to extend my thanks
and CEO of CIMB Bank Singapore, Mohamed Rafe Mohamed to all our Board of Directors for their guidance and unwavering
Haneef as CEO of Group Transaction Banking and Mak Lye Mun as support. Allow me to also thank our clients, shareholders,
Adviser to the Group CEO. regulators, and the communities in which we operate, for placing
their trust in CIMB and its leadership.
I would like to thank Mak Lye Mun for having served as CEO of
CIMB Bank Singapore, and Kittiphun Anutarasoti for his past Last, but most definitely not least, I am immensely grateful for the
contribution as President and CEO of CIMB Thai. My gratitude also support and commitment of #teamCIMB. I am always heartened to
goes out to Victor Lee Meng Teck and Mohamed Rafe Mohamed see the dedication of my fellow colleagues in banding together no
Haneef for their contributions in their previous roles as CEO of matter the difficulty. Even though 2020 began on a tough note,
Group Transaction Banking and CEO of Group Islamic Banking I look forward to working with each and every one of you to soldier
respectively. I would like to also thank Renzo Christopher Viegas through all challenges and capitalise on opportunities and achieve
and Thomas Meow for their service as Advisers to the Group CEO. our Forward23 aspirations together.

In terms of changes at the Board level, we saw Didi Syafruddin

Yahya joining the Board of CIMB Group as an Independent Director
and Sukanta Kumar Dutt joining the Board of CIMB Bank Berhad.
Allow me to express my sincerest gratitude to Tongurai Limpiti and
Dato’ Sri Amrin Awaluddin for having served on the boards of CIMB
Group and CIMB Bank Berhad respectively.
Tengku Zafrul Tengku Abdul Aziz
The year 2019 also saw the dissolution of CIMB’s International Group Chief Executive Officer
Advisory Panel (IAP), established in 2006 to assist the Board and
senior management by providing an unbiased external perspective,
principally in terms of steering the Group’s geographical expansion.
We benefitted tremendously from the wisdom and advice of the

23
economic and banking

2019: HISTORY 2020: CAUTIOUS

REPEATS Clarence Darrow, a prominent US attorney in OPTIMISM The projected growth pickup in 2020 is
the early 20th century, said, “History repeats precarious, presuming successful control of
itself, and that's one of the things that’s wrong the COVID-19 epidemic by the first half of
with history”; and that was one of the things 2020, with a sharp subsequent rebound and
troubling in 2019. Marking the end of the no backtracking on trade policy differences.
decade, 2019 saw world economies Our 2020 forecast is weaker than the GDP
struggling with persistent, recurring issues: growth in 2019.
From geopolitical power struggles between the US and China to
socio-economic and political strife in Venezuela, Chile, France, Besides the spectre of disease, the uncertainty stemming from the
Myanmar and India; from US Administration’s uncertainty to the vague position of the US administration on trade and foreign
resilience of the emerging world; from financial accountability to policies will likely remain a drag on GDP growth. This will tend to
social and environmental responsibilities – 2019 was indeed a dampen investment and through creating tail risks associated with
challenging year. either a re-ignition of trade conflicts, geopolitical miscalculations
that lead to real conflicts.
Trade tensions and receding monetary policy options in key parts of
the world were two forces that influenced economic trends and In Europe, in contrast, the UK’s controversial withdrawal, the
asset markets last year. What did not change from previous years ideological divisions over fiscal policy and the limits to quantitative
was the continuing relatively sluggish global growth. Mild inflation easing are likely to combine in pushing down growth to 1% even as
led some central banks to manage the downside risks to growth by the global trade decline stabilises.
taking greater credit risks (Japan, Eurozone). Others, with more
scope to use old-fashioned rate cuts did just that. With further In ASEAN, fiscal policy and trade openness should prove drivers of
easing now, likely due to COVID-19, the global weighted average differential performance, with Thailand and Singapore pursuing
policy rate should reach a seven-year low by end of first quarter expansionary policy and Malaysia and Indonesia being more
2020. cautious. Our forecast for growth in ASEAN overall shows a
deceleration for 2020 relative to 2019, but that should mask an
Across ASEAN monetary stimulus was a means to offset the acceleration during the second half of the year.
short-run unfavourable impact from US-China trade tensions. Trade
diversion – firms relocating out of China was another offset. Overall, The 2020 outcomes will also depend on country’s sensitivity to a
GDP growth decelerated in ASEAN in 2019. pandemic and the economic consequences of such a pandemic.
We have created two indices that rank Asian countries by both
The US-China trade tensions were disruptive to ASEAN nations in measures. The first depends on factors like the demographic
2019, especially those more open to trade and where foreign composition of a country and the magnitude of visitor arrivals, but
investments are critical for their growth. ASEAN, though, was also also critically on the quality of each country’s healthcare system. On
divided by the scope for and willingness to use fiscal policies in this measure, Indonesia and the Philippines are especially sensitive.
meeting the external shocks. For instance, Thailand and Singapore On the second, economic sensitivity, Hong Kong, Singapore and
have been pursuing expansionary fiscal policies, reinforced by Thailand are the most exposed because of the importance of
COVID-19. Malaysia, while announcing a 2020 supplmental budget, tourism and services in their economies.
continues to constraint itself to not worsening its federal budget
balance. We have seen Indonesia tightening its policies for 2020 would also see a reduction in the political risk premium given
structural reasons, mainly to improve its fiscal position. the distance from the elections in Indonesia and Thailand. Malaysia,
however, will need to navigate the changes wrought by unexpected
We also saw different degrees of importance stressed by central change in government at the end of February 2020. Singapore’s
banks over inflation, growth and exchange rates. The Bank of expected election in 2020 (latest by April 2021) would likely result in
Thailand saw continued strengthening of the baht on the back of its a persistence of the status quo.
large current account surplus, itself a sign of weak domestic
investment and undertook a number of measures designed to Pandemic Sensitivity Economic Sensitivity
promote capital outflow. Bank Indonesia, shifted its concerns away Index for Asian Index for Asian
from the current account and the value of the rupiah to GDP Countries Countries
growth, repeatedly lowering interest rates despite a fiscal stance 80 80
70 70
that has been tight. 60 60
50 50
40 40
30 30
20 20
10 10
0 0
ng ia
Ind ore

Th sia

ilip m
es

e
Th ia

ilip m
es
ia
or
an

an
ys

ys

es
Ph na

Ph na
pin
pin
e
ap

ap
ail

ail
ala

ala
on

on
et

et
ng
Vi

Vi
Ind
M

M
Si

Si

Source: CIMB calculations using data from Haver Analytics

24
 ECONOMICS
OF CLIMATE According to the Asia-Pacific Disaster Report Due to emerging climate policies, advanced technologies, and
CHANGE 2019, natural disasters triggered by climate growing pressure from institutional investors and regulators, banks
change and environmental degradation have started to reassess the value of their financial assets. Financial
continued to grow in intensity, frequency and markets that recognise the potential of sustainable finance and
complexity. The annual economic losses for investments are already working to tap huge opportunities of the
Asia and the Pacific are projected at $675 present – from clean energy infrastructure to resilient, green
billion, approximately 2.4 per cent of the buildings, and the new financial instruments to fund those
region’s GDP. The World Bank says that the climate impacts could investments. Banks globally have started rethinking their business
push an additional 100 million people into poverty by 2030. Further, models as the transition to a net-zero carbon emission economy
the United Nations points out that delay in tackling the financial becomes more and more imminent.
risks to the global economy triggered by climate change could cost
companies nearly $1.2 trillion over the next 15 years (MSCI: Central banks, policy-makers and regulators in Asia have either
Carbon-Delta). mandated or are in the process of issuing guidelines to help
financial institutions and companies adhere to a set of climate risk
Banks and institutional investors are experiencing vulnerability to disclosures and classification standards.
climate change and some are being forced to start accounting for
the associated risks, including the exposure of mortgage books to In summary, many more opportunities will emerge over the next 3-5
natural disasters, the impact of extreme weather conditions on years, motivating Banks to meaningfully contribute to shaping a
sovereign risk, the exposure to carbon-intensive sectors, etc. better future while championing sustainable business.

MARKET
OUTLOOK 2020 Regulatory authorities, policy-makers and INDONESIA:
institutional investors are increasingly The favourable inflationary environment from 2019, coupled with
focussing on sustainable finance. Hence, in GDP growth forecast of 5.1% for 2020, should improve overall
2020, we will see more commercial banks demand and enable industry loan growth. We expect loan growth for
committing to principles for responsible the aggregate ID banks we cover to improve from 8.4% in 2019 to
banking and positively contributing to 9.1% in 2020. Furthermore, the expected stable net interest margins
sustainable development by managing and environment would allow PPOP growth to accelerate, assuming
influencing the economic, environmental, social and governance stable non-interest income and operating expenses growth. The
impacts in their value chain. overall improvement in the economy should rein in NPLs and in turn
allow banks to lower credit costs to below 100 bps in 2020 from 122
The banking sector will also face increased competition from bps in 2019. In totality, we expect banks’ aggregate profits to improve
pure-play FinTechs, e-commerce companies, telecom service toward low-mid-teens this year from 5.4% last year.
providers, and established financial services brands. The central
banks of Malaysia and Singapore, for instance, has plans to issue SINGAPORE:
digital banking licences in the near future. The years ahead will
We expect the effects of lower policy rates across the region on
also see the digitalisation efforts of major banks accelerating; the
net interest margins to stabilise in 2H20 onwards as funding cost
potential is huge, with nearly 198 million unbanked citizens
savings gradually catch-up to lower yields. To this end, we look
throughout ASEAN.
towards fee income streams such as wealth management income
to bolster earnings as credit growth is likely to stay moderate on a
Against this backdrop, in the four major markets where we
flattish GDP growth forecast of 0.8% in 2020 (c.f.+0.7% in 2019).
operate Malaysia, Indonesia, Singapore and Thailand, we are
The wildcard of the year lies in the extent of cashflow disruptions
well-equipped and well-positioned to embrace the changes and
from COVID-19, adding to potential revenue headwinds if the
compete with both the traditional and Fintechs to respond to the
situation prolongs. The Monetary Authority of Singapore is set to
dynamic marketplace and the evolving sector.
award five digital banking licenses in mid-2020. The path to
profitability while servicing the underserved segment may be a
MALAYSIA:
challenging task for the newcomers, but we do expect stiff digital
We see potential earnings risk from an OPR (overnight policy rate) competition for the incumbents ahead.
cut and expected deterioration in asset quality. We expect the
industry’s gross impaired loan ratio to rise further from 1.5% at THAILAND:
end-2019 to 1.7% at end-2020. Our economist is also anticipating
We believe a stronger recovery in business sentiment following the
two rounds of OPR cuts in 2020 – one of which has already taken
government’s attempt to encourage FDI could boost 2020 loan growth
place in January – which could be detrimental for banks’ margins.
further to 3.3%, from 2.7% in 2019. Domestic spending stimulus
Meanwhile, we are projecting a loan growth of 4-4.5% in 2020,
could also lead to a recovery in domestic demand and propel the
above the 3.9% in 2019, with potential downside risks from
retail segment, despite the already-high household debt to GDP.
external headwinds arising from the COVID-19 outbreak. The
Banks’ net interest margins are likely to continue to be pressured
RM20 billion stimulus package announced on 27 February should
by the two 25 bps rate cuts in late 2019, and two possible 25 bps
have a net positive impact, but we believe business sentiment will
policy rate cuts in 1H20, bringing the policy rate to 0.75%, below
remain cautious until external and domestic political headwinds
its historical floor of 1.25%. Without any clear sign of improvement
dissipate.
in the economy, we expect a GDP growth of 2.4% in 2020.

25
material matters

MATERIAL MATTERS HOW DO WE REALISE OUR STRATEGY? MORE INFORMATION

Why Are These Important?

GEOPOLITICAL AND ECONOMIC

DEVELOPMENTS
Page 24
We operate in an increasingly evolving • Consistently monitor external developments and update our Economic and Business
environment. The pace of change is strategies accordingly. Review & Outlook
accelerating; hence we need to align our • Formulate a growth strategy which recognises that every
strategies to this. market is different, with varying starting points and market
dynamics.

TECHNOLOGY

The 4th Industrial Revolution is here and • Build a “beyond banking” proposition for future value capture Page 14
this has necessitated the need to pivot to the Group by being both a participant and/or owner of Group CEO’s Overview
the organisation digitally. Technology Ecosystems.
and data forms the core that will enable • Strengthen the resiliency of our systems. Page 70
Sustainability Report
the organisation to compete and win in • Increase productivity via technology modernisation and
the future. automation efforts.
• Strengthen data analytics and capabilities to be a data-first
organisation.
• Apply comprehensive data governance, including data
origination, access, use, security and privacy.

REGULATION

Regulation provides protection as well as • Enhance policies, procedures and risk practices in line with Page 27
stability for the financial ecosystem. regulatory standards. Key Risks and Mitigation
Rules change and evolve, thus we need • Closely monitor industry and regulatory developments
to be fully engaged with our regulators. worldwide.

CUSTOMER EXPECTATIONS

Customer expectations are rising in line • Embrace the “Treating Customers Fairly” principles. Page 14
with the digital revolution where access • Transform customer journeys by leveraging on digital and Group CEO’s Overview
and speed of information sharing is a key introducing new ways of working.
catalyst. • Incorporate Net Promoter Score (NPS) as a key target across Page 28
The Group’s Strategy
the organisation.

WORKFORCE NEEDS

The mix of talent we need as well as • Build and source key digital talent. Page 15
what tools they need in order to succeed • Set a target of 30% digital, data and design (3D) talent by Group CEO’s Overview
in the 4th Industrial Revolution 2023.
environment will be critical. • Invest in upskilling and reskilling to future-proof our people, Page 89
Human Capital
ensuring their skills remain relevant.
Development
• Encourage a culture of responsibility and cooperation through
“A Better CIMB” initiative to drive performance.

ECONOMIC, ENVIRONMENTAL AND

SOCIAL (EES) FACTORS
Page 144
Various stakeholders are increasingly • Mitigate environmental and social impact arising from our Sustainability Statement
expecting companies to incorporate EES financing and operational activities through our sustainability
into the core of their strategies. CIMB due diligence processes.
intends to be a leader in this space and • Provide banking solutions that facilitate sustainable
hence is undertaking various efforts. development, thus enhancing positive EES impact for our
clients and ourselves.

26
 key risks

TYPE OF RISK MITIGATION ACTIONS

• The Group has a robust credit risk policy framework, embedded with prudent lending guidelines to minimise
credit default and losses. Appropriate governance which are subcommittees of the Group Risk and
Compliance Committee (GRCC) is in place to manage the credit risk of the Group.
• The Group strives to maintain a portfolio of credit risk which is adequately diversified by country, industry,
market, sector, product, customer segment and duration. Business Units are responsible for the risks, with
Group Risk Division providing independent oversight for overall risk control.
• Aside from periodic reviews, the Group has an Early Warning Indicator and Watchlist Process. It is a pro-active
credit risk management tool that identifies deteriorating credits at early stages, thereby minimising any
CREDIT RISK potential credit loss.
• An independent post-credit review process conducted regularly assesses the quality of loans approved.
• The Board Risk and Compliance Committee (BRCC) and GRCC periodically set the high level credit risk
direction using the Risk Posture and Risk Appetite frameworks.
• Exposures are actively monitored, reviewed regularly and reported to GRCC and BRCC. Deteriorating
portfolios are identified, analysed and discussed with the relevant business units for appropriate remedial
actions, as required.
• Data and analytics are leveraged to assess portfolios, as well as to timely identify problem areas and decide
on corrective actions.

• The Group maintains a robust and effective market risk policy framework and actively measures, monitors and
manages market risk within the approved Risk Appetite.
• The Group Market Risk Committee, a subcommittee of the GRCC, is supported by several working groups to
MARKET RISK
provide better oversight on various areas of risk and governance.
• The Group also provides constructive challenge to the first line of defence in managing the market risk of the
Group and adopts the best practices for market risk management in the region.

• The Group actively manages its non-financial risks, which comprises Operational, Reputation, Shariah,
Technology, Fraud, Outsourcing and Business Continuity risks within the Board approved risk appetites.
• The Operational Risk Management function, which resides within CIMB Group’s Non-Financial Risk
Management (NFRM) Department, provides the methodology, tools and processes for the identification,
NON-FINANCIAL
assessment, reporting and management of operational risks by the respective risk owners across the Group.
RISKS
NFRM also independently oversees the operational risk controls monitoring that resides within the first
line-of-defence functions.
• The Group Operational & Resiliency Risk Committee (GORRC), a sub-committee to the GRCC is also in place
to provide direct oversight on operational risk & technology matters across the Group.

• The Group maintains high quality liquid assets and well diversified sources of funds as a liquidity risk buffer
under both business-as-usual (BAU) and stress conditions.
• The Group actively measures, monitors and manages its liquidity positions to comply with regulatory Basel III
FUNDING & liquidity risk requirements and internal risk appetite.
LIQUIDITY RISK • The Group also performs semi-annual consolidated stress tests (including liquidity stress tests) to identify
vulnerable areas in its portfolio, gauge the financial impact and enable management to take pre-emptive actions.
• The Group Asset Liability Management Committee (Group ALCO), a subcommittee of GRCC discusses the
liquidity risk and funding profile of the Group.

• Country limits are set to capture and manage country risks arising from credit exposure to obligors.
COUNTRY RISK • Country limits are approved by Group Credit Committee upon consideration of the relevant risks and business
requirements.

• The Group has established the Board Shariah Committee (BSC) and four Shariah functions namely, Shariah &
SHARIAH Governance, Shariah Risk Management, Shariah Review and Shariah Audit, as required under BNM Shariah
Governance Framework. This governance is to monitor Shariah compliance in the Islamic banking business.
NON-
• Shariah-related policies and procedures have been developed among others, requiring approval from BSC for
COMPLIANCE
all Islamic banking business and operations.
RISK • Risk management tools are in place to facilitate how Business Units (BU)/Business Enablers (BE) identify and
manage inherent SNC risk.

• The Group has instituted the Sustainability Risk Management Framework with the objective of identifying,
assessing, governing, managing and monitoring its EES risks through appropriate policies, procedures and
SUSTAINABILITY
controls.
RISK
• The Group Sustainability Council oversees the sustainability risk profile of the Group's business activities and
ensures the implementation of appropriate policies, procedures and controls.

27
the group’s

Launched in early 2019, Forward23 is the Group’s response to the ever-evolving operating landscape in the new digital economy. The
strategy reflects the Group’s strong commitment towards sustainable value creation for our stakeholders and this is reflected by our new
purpose statement, ‘Advancing Customers and Society’.

As a leading ASEAN universal bank with presence and footprint in all ASEAN countries, we recognise that starting points and market
dynamics vary, and as such, have designed differentiated market postures across the various markets that we operate in. Malaysia and
Indonesia represent the two largest sources of value for the Group. Forward23 is about the focused pursuit of sustainable growth and
performance for the Group at present, and into the future.

For the year in review, the following strategic pivots formed the core of our Forward23 execution:

• Customer Centricity

• Technology & Data

• Our People

• Ventures & Partnerships

• Sustainability

CUSTOMER CENTRICIT Y 

Over the last few years, we have worked on strengthening our Asia-Pacific Best Practices Awards. In Indonesia, we were awarded
Customer Experience (CX) framework and culture in the effort to “The Best Bank in Customer Satisfaction Services” at the Tempo
become a customer-centric organisation. The Group has taken a Financial Award 2019.
multi-pronged approach to this, focusing on the end-to-end
transformation of customer journeys, putting in place CX metrics We anchor ourselves on our CX promises to make banking Easy,
across all levels of operations and building a strong CX culture for Efficient and always going the Extra Mile for our customers. We
our people. also provide our employees proper Escalation points of support
for better customer resolution, as well as empowering them
In 2019, we received several recognitions for CX excellence, (Empowerment).
including the “Malaysia Excellence Award in Customer Experience
– Banking Industry for Overall Experience” at Frost & Sullivan’s 2019

The Group Chief Strategy and Design Officer introducing the Group’s strategy at the Forward23 kick off in February 2019.

28
UNDERSTANDING OUR CUSTOMERS In 2019, we kickstarted the revamp of select customer journeys in
To fortify the mindset of continuous improvement from a customer- our largest markets, covering the Commercial Lending and Retail
centric standpoint, we have rebuilt our CX measurement ecosystem by CASA journeys in Malaysia, as well as the Auto Financing, SME
determining key metrics that are vital to customers at the operational, Lending and SME Funding journeys in Indonesia.
transactional and strategic levels. We have since seen improvements
across our core channels, and derived valuable insights which has
helped us strengthen our value proposition.
T E C H N O LO GY & DATA 

The ultimate outcome gauge of where we stand in customer Shaping the future of the industry, technology in banking is rapidly
engagement is the Net Promoter Score (NPS). This is now measured evolving with the emergence of new business models, hybrid
regionally and in 2019, we made particularly strong improvements in industry players and raised customer expectations. To support our
Indonesia. pursuit to future-proof the Group and redefine our position in this
disruptive environment, the Group is undergoing a multi-year
INSTILLING CX VALUES technology and data transformation to drive greater resiliency,
Becoming a customer-centric organisation begins with ensuring our speed and differentiated digital solutions.
people share the same values and are well-equipped to provide
exceptional CX. To that end, a number of internal activation, In 2019, we formulated a transformation roadmap to refresh our
engagement and training initiatives have been rolled out to create technology fundamentals, with focus on improving technology
CX awareness and help build a workforce that is customer-centric. resiliency, IT security and efficiency. With the transformation in
place, we also seek to build critical business capabilities within the
Among the highlights of the year include our regional Customer Day Group to support new ways of working as we strive to move
celebration to appreciate our customers and nurture trust in the towards building a digital-centric banking platform and expand into
CIMB brand. We reached out and celebrated our customers ecosystem-linked business models.
through the Group’s various channels.
The Group Data Office was set up to drive enterprise-wide data
In activating our customer-centricity agenda across the transformation across the following streams; develop overall data
organisation, we introduced an internal guide to help our frontliners vision and strategy, support business functions on domain
interact effectively with customers. We have also put in place deployment and execution of business-aligned data strategy, and
structured training programmes to enhance the team’s refine policies and framework on data governance.
understanding and capabilities.

END-TO-END REDESIGN OF CUSTOMER JOURNEYS OUR PEOPLE 

A dedicated Transforming Customer Journey (TCJ) department was
set up to drive a holistic redesign of our customer journeys. The Our greatest asset, our people, are central to delivering and
department, comprising a diverse talent mix made up of experts in supporting our Forward23 plans and aspirations. Thus, we make it
iterative design and agile practitioners, bring a new way of working a priority to equip our people with essential skills and competencies
within the Group, paving the way for new capabilities. to remain competitive in this data-driven, tech-enabled
environment. In tandem with our digitalisation efforts and future-
TCJ seeks to integrate innovative digital solutions such as fully proofing agenda, developing a workforce with the right skillset is
online application processes, eKYC, and simplified real-time crucial to help achieve our ambitions.
customer pre-screening, among others, allowing us to provide
seamless, fast and hassle-free services to our customers. The Group has committed to ensure that by 2023, 30% of the
Leveraging on digital in our customer journeys will positively impact Group’s employees are digital, data and design-enabled. Pivoting
end-to-end productivity of our employees, as well as empower towards this target, we have put in place a strategy to build and
them to focus on delivering value. retain a 3D mix in our workforce, as well as strive to position CIMB
Group as a 3D employer.

29
the group’s strategy

FUTURE OF WORK CENTRE DIGITAL BREAKTHROUGH IN THE PHILIPPINES

In April 2019, we introduced the Future of Work Centre (FOWC) to The Group’s all-digital, mobile-first bank in the Philippines was
strengthen employability of our employees by upskilling and officially launched early-2019 and has proved its ability to scale
reskilling, particularly in relation to digital, data and design (3D) with the acquisition of 1.7 million customers in the first year.
skills. The FOWC offers training programmes for employees of all CIMB Bank Philippines operates a unique business model
levels of competencies, and as of 2019, more than 2,200 enabled by partnerships, which sees us providing services on
employees have undergone training related to 3D skills. digital platforms. We are the first bank in the Philippines to
allow customers to complete end-to-end digital account
The FOWC also facilitates job mobility of employees who have opening.
undergone upskilling/reskilling to reap the full benefits of their
training. Employees are presented the opportunity to explore new DOMINATING THE E-WALLET SPACE IN MALAYSIA
roles via internal and external internships on project-based or
Touch ‘n Go Digital, our payments joint venture with Ant Financial
temporary placements, providing them a safe environment to
continues to show positive momentum in 2019. With over
practice their skills and gain confidence in their new roles.
6.8 million registered users, 4.2 million annual active users and
116,000 merchants as at end of 2019, the Touch ‘n Go e-wallet is
TALENT ATTRACTION AND RETENTION
Malaysia’s largest e-wallet business.
To support the broader cultural shift as we move towards becoming
a more digital-centric organisation, we also look into elevating the
employee experience at CIMB Group to strengthen our employer
S U S TA I N A B I L I T Y 
branding and become a compelling organisation for quality digital
talent. To this end, we have introduced fast-track recruitment for 3D
CIMB Group is committed to sustainable business practices.
talent, as well as established principles of a refreshed performance
We aim to create impact by embedding sustainability elements in
framework to introduce personalised benefits.
our governance and internal processes, expanding our sustainable
products and services offering and raising awareness on
economic, environmental and social (EES) issues to both our
V E N T U R E S & PA R T N E R S H I P S internal and external stakeholders.


In the next few years, stronger efforts will be made to drive CIMB In 2019, we have taken great strides in pursuing our sustainability
Group’s future-proofing agenda, ensuring relevance, longevity and agenda, with the aspiration to rank in the Top 3 among
sustenance of the banking group in the long run. In 2019, we comparable ASEAN banking groups and in the 75th percentile
established our Group Ventures and Partnerships division to drive globally in the Dow Jones Sustainability Index by 2023.
all strategic partnerships across business lines and explore
strategic joint ventures.

#teamCIMB learning about the various programmes under Forward23 and how they can contribute as project team members.

30
LEADING THE WAY FOR THE ASEAN BANKING COMMUNITY

In 2019, CIMB Group played an active role in championing the

sustainability agenda, firstly, by becoming one the of the 30
founding banks that assisted in the development of the Principles of
Responsible Banking by UNEP-FI, which formally launched on
23 September 2019. We also launched a USD680 million
Sustainable Development Goals Bond (SDG Bond), the first ever
issued by a Malaysian and ASEAN issuer in the international capital
market.

CATALYSING CHANGE

As a banking institution, we are able to play an impactful role in

influencing our customers and clients in moving towards
sustainable practices. As a proactive measure in assessing and
mitigating the EES risks associated to our operations and business,
we introduced our Group Sustainability Policy (GSP) and Group
Sustainable Financing Policy (GSFP). The institution of these
policies inculcates awareness of sustainable business practices,
while helping to build a strong risk culture within the Group.

CIMB Group also established the Positive Impact Products and

Services (PIPS) framework to guide the development of sustainable
products and services. To that end, in 2019 we have committed
RM3 billion for the disbursement of Sustainability Linked Loans
(SLL) which incentivises companies to commit to sustainability-
related performance targets and getting them on board the
sustainability agenda.

M OV I N G F O R WA R D

2019 was about getting into the rhythm and pace to kick off the
transformation, building a solid foundation for the years ahead of
us. To ensure forward traction, the Transformation Council, a focus
group of our senior management members, provides oversight and
steer on our Forward23 portfolio.

We have picked up positive momentum at the start of our

Forward23 journey, with positive progress made across our key
pivot drivers. In 2020 and beyond, we will continue to remain
focused in delivering our targets, with ongoing efforts to strengthen
our core markets, Malaysia and Indonesia. The Group will also
be intensifying efforts in improving technological resiliency,
stability and security to support our drive to future proof the
organisation.

#teamCIMB in the Klang Valley taking part in the #movingForward23together

roadshow.

31
 group financial review by

“2019 was a momentous year as the Group kicked-off its new 5-year Forward23 strategic
plan and made significant strides in its first year. The Group’s 2019 net profit of RM4.56
billion, translating to a net earnings per share (EPS) of 47.0 sen is commendable
considering the challenging operating environment and macroeconomic headwinds. We
succeeded to achieve most of our financial targets and most notably, we met our 2019
ROE target of 9.3% on a Business As Usual (BAU) basis. This is whilst making
investments under our Forward23 plan to future-proof ourselves and to place the Group
in a better competitive position. Our stronger capital position has allowed us to pay the
second interim dividend fully in cash, thereby increasing the returns to shareholders.”

THE YEAR IN
REVIEW The operating backdrop in 2019 was somewhat mixed with the material pick up in
treasury market activities being dampened by the continued global trade tensions,
which led to slower economic growth across the region and looser monetary policies
by most central banks. Despite the softer economic environment across most of our
markets, the Group remained focused in its strategy to grow in the targeted segments
and markets, whilst concurrently investing for the future to strengthen the core and its
people. This enabled us to meet our main financial target of an ROE of 9.3% on a BAU
basis and strengthen our Common Equity Tier 1 (CET1) ratio to 12.9%.

For 2019, we recorded a 7.7% increase in BAU net profit to RM5.0 billion, equivalent to an EPS of 51.7
sen. BAU excludes the one-off items of the gain from the sale of interest in our asset management
business in 2018 amounting to RM928 million and the net transformational costs of RM270 million and
the RM185 million write-off of intangible assets in 2019. This is a better reflection of the Group’s
underlying operational performance and the subsequent numbers excludes these three one-off items.

The strong net profit growth was underpinned by robust operating income growth of 8.2% driven by
market share gains in loans in our key operating markets and higher treasury related income. As we
ended the year on a stronger capital position, we maintained a high dividend pay-out of 50.9% (on
BAU net profit) or a payout to 55.9% based on reported numbers. Asset quality remained stable with a
loan loss charge of 0.44% and the Group’s Cost-to-Income (CIR) ratio stood at 53.4% as we invest for
the future.

32
KHAIRUL RIFAIE
Group Chief Financial Officer

33
group financial review by group CFO

The performance was in line with the Group’s Forward23 strategic – The Group’s Loan Loss Provisions rose 14.5% YoY to RM1.64
focus on key growth markets and segments, whilst maintaining billion from RM1.43 billion in 2018. Commercial Banking
intensity on asset quality and risk management. The Group provisions improved significantly owing to improved underlying
streamlined operations across the region and was in active provisions as well as MFRS9 write backs. This is offset by
investment mode to derive greater operational efficiency and to higher Consumer provisions mainly from MFRS9 related
future proof ourselves. These factors drove the financial adjustments and Wholesale Banking provisions due to an uptick
performance in 2019: in Indonesia. The Group’s gross impaired loans ratio stood at
3.1% with the Loan Loss Charge (“LLC”) at 44bps for the year.
– The Group’s 2019 revenues were 8.2% higher at RM17.80 billion
On the whole, the Group’s asset quality remains under control.
compared to RM16.45 billion in 2018.
– Total gross loans grew 6.7% YoY, underpinned by market share
– Net interest income (NII) rose 6.3% YoY to RM12.66 billion from
gains in Malaysia, Thailand and Singapore growing at 6.0%,
stronger loan growth across all core markets, up by 6.7% YoY,
6.1% and 3.7%, respectively. Meanwhile, Indonesia grew at a
offset by the 4bps YoY contraction in Net Interest Margins (NIM)
respectable rate of 3.0%. Consumer Banking loans expanded
to 2.46%, largely due to the OPR cut in Malaysia.
9.0% during the year while Wholesale loans were 7.2% higher.
– Non-interest income (NOII) grew by 12.9% to RM5.14 billion
– Group deposits were 5.8% higher YoY driven by Consumer and
mainly attributed to the stronger trading and FX income during
Wholesale Banking deposits which grew 8.9% and 4.5%,
the year, coupled with a higher gain from the sale of the equities
respectively, while Commercial Banking deposits improved
business in 2019.
slightly, rising 0.9% YoY. The Group’s CASA ratio stood at
– Operating expenses were 9.8% higher YoY at RM9.50 billion in 34.4% as at end-2019 compared to 32.7% in 2018. Liquidity
2019 as the Group stepped up strategic investments under remained strong with the Loan to Deposit Ratio at 92.0% whilst
Forward23 across all businesses. As a consequence of the the Liquidity Coverage Ratio stood comfortably above 100% for
investments undertaken, the Group’s cost-to-income ratio (CIR) all banking entities.
was slightly higher at 53.4% (52.6% in 2018).
– Capital adequacy continued to strengthen as we ended 2019
with a CET1 ratio of 12.9% against 12.5% as at end-2018.

G R OW T H D R I V E R S – The improved investor sentiment in 2019 led to a strong 12.9%

YoY improvement in NOII underpinned by Trading and FX
The Group’s bottom-line performance in 2019 was underscored revenues, particularly in the third quarter of the year. Other
by a sustained loan growth momentum, improved NOII from income was also higher from a combination of gains from
higher trading and FX activities and strong balance sheet Non-Performing Loan (NPL) sales in CIMB Niaga and CIMB
management which mitigated the pressure on NIM. Thai and a higher gain from the sale of the Malaysian equities
– Loan growth was prudent and the Group remained guided by business in 2019.
the Forward23 strategy focusing on key markets and
segments, whilst keeping a close watch on risk-adjusted Stronger NOII from Trading & FX and Other Income
returns. Overall Group Gross Loans expanded by 6.7% YoY Total NOII (RM’million)
led by Consumer and Wholesale Banking loans. Malaysia
Consumer loans performed well as we saw market share +12.9% YoY
5,137
gains in the mortgages (+8.9%) and auto loans (+3.3%) 4,550
%
segments, while Indonesia had meaningful gains in mortgages +143.0 537
Other Income 221
(+12.5%) and credit cards (+12.7%). Commercial Banking loans
recorded strong growth in the Malaysian SME segment but +34.3% 1,978
this was offset by lower growth in Indonesia and Singapore. Trading & FX 1,473
Wholesale Banking loans was robust at 7.2% considering the
softer regional economies. Others

– The interest rate cuts in the region, particularly the OPR cut in
2,577
Malaysia contributed to the 4bps compression in the Group’s 2,259
NIMs. Nevertheless, the impact was tempered by strong
balance sheet management and portfolio optimisation in
Indonesia and Singapore, where NIMs rose by 19bps and
FY18 BAU^ FY19
8bps respectively.
^ Excludes CPAM & CPIAM gain of RM928 million in FY18.

34
OV E R V I E W O F B U S I N E S S - U N I T P E R F O R M A N C E

This section serves as an overview of the performance of the FY19 FY18

Group’s business units. Further details can be obtained from the (RM’million) BAU* BAU^ YoY
Business Review section of this report.
Consumer Banking 1,959 2,659 (26.3%)
– The Consumer Banking underlying operations performed well
as the business continued to gain market share in targeted Commercial Banking 1,609 860 87.1%
segments and markets. Consumer operating income grew by Wholesale Banking 1,928 1,834 5.1%
2.3% YoY on the back of a strong 9.0% loan growth, partially Corporate Banking 1,258 1,382 (9.0%)
mitigated by NIM contraction arising from the OPR cut in
Treasury & Markets 632 423 49.4%
Malaysia as well as MFRS9-related adjustments to NII.
Consumer NOII showed healthy momentum with a recovery in Investment Banking 38 29 31.0%
wealth management income during the year. The divisional Ventures, Partnerships
provisions rose by 126.5% YoY owing to MFRS9-related model & Funding 1,122 920 22.0%
enhancements. With operating expenses 6.7% higher YoY from
PBT 6,618 6,273 5.5%
business expansion in Thailand and Indonesia, the Consumer
PBT came in at RM1.96 billion for 2019, a decline of 26.3% YoY
compared to RM2.66 billion in 2018.
– Commercial Banking had a strong year with its PBT increasing
FY19 FY18
87.1% YoY to RM1.61 billion in 2019 from RM0.86 billion in 2018.
(RM’million) BAU* BAU^ YoY
This was attributed to a combination of higher operating income
of 6.8% and sharply reduced loan provisions. While divisional Consumer Banking 7,411 7,242 2.3%
loan growth was flat YoY, Malaysia Commercial loans expanded Commercial Banking 3,412 3,195 6.8%
by 12.3% YoY as the other operating countries undertook
portfolio realignments for greater client focus. NOII was sharply Wholesale Banking 4,927 4,510 9.2%
higher owing to NPL sales in Indonesia and Thailand during the Corporate Banking 2,920 2,800 4.3%
year. Whilst operating expenses were kept under control, the Treasury & Markets 1,546 1,256 23.1%
division also benefited from improved underlying loan
Investment Banking 461 454 1.5%
provisions.
Ventures, Partnerships
– Wholesale Banking posted an increase of 5.1% YoY in its PBT to & Funding 2,046 1,507 35.8%
RM1.93 billion in tandem with the improved market sentiment
and activity. This was evident in the healthy improvement in Total Income 17,796 16,454 8.2%
NOII (+14.1% YoY) on the back of stronger Treasury & Markets
income. The 7.2% Corporate loan growth supported the steady Notes:
* Excludes transformational cost of RM366 million and impairment and write off
6.6% YoY NII growth as it was partially offset by lower NIM. of intangible assets of RM277 milionl
Divisional costs were within expectations while loan provisions ^ Excludes CPAM & CPIAM gain of RM928 million
rose by 47.9% due to some weakness in a few corporate
accounts in Indonesia during the year.
– Group Ventures, Partnerships & Funding’s (GVPF) PBT rose
22.0% to RM1.12 billion from higher returns from the Group’s
fixed income portfolio as well as a higher gain from the sale of
the Malaysian equities business. The Group’s 40% interest in
the asset management business saw strong growth with Assets
Under Management rising by 12.5% YoY. The TnG Digital JV
continues to make progressive strides forward as it is now the
No.1 e-wallet in Malaysia with 6.8 million registered users and
116,000 merchants as at end-2019. CIMB Philippines has
grown to be the strongest standalone digital bank in the country
with over 1.7 million customers acquired over its first year of
operations. For 2019, GVPF operating expenses were higher
due to the Forward23-related staff transformational expenses
undertaken in Indonesia and Malaysia in 2019, as well as
increased marketing expenses at TnG Digital.

35
group financial review by group CFO

OV E R V I E W O F C O U N T RY
PERFORMANCE

The Group continues to strengthen its ASEAN Loans by country as at Deposits by country as at
footprint with the acceleration of CIMB Philippines 31 December 2019 31 December 2019
in 2019. Under the Forward23 plan, there will be a
focus on scale and accelerate growth in the Others Others
Group's main operating countries, Malaysia and 5% Singapore 2%
Singapore Malaysia 10% Malaysia
Indonesia. For Thailand and Singapore, we are 8% 60% 67%
focused on repositioning our business and Thailand
growing in these markets. Whilst for our newer Thailand 7%
footprints like Vietnam and the Philippines, we will 10%
continue to incubate and invest.
31 Dec 19# 31 Dec 19
RM369.5 RM401.7
billion Indonesia billion
The following section provides an overview of the
14%
Group’s performance by country:
Indonesia
– Malaysia’s PBT expanded 8.0% YoY to 17%
RM4.75 billion from a combination of loan
growth, a recovery in markets-related trading
income and the gain from the sale of the
equities business. Malaysia gross loans grew Loans Growth+ YoY Deposits Growth YoY
at 6.0% YoY, above the industry growth of
Malaysia 6.0% Malaysia 6.2%
3.9%, largely due to market share gains in
Consumer and positive results from the Indonesia ^ 3.0% Indonesia ^ 2.5%
recalibration of the Commercial Banking Thailand ^ 6.1% Thailand ^ 7.5%
business. From a PBT perspective, Singapore ^ 3.7% Singapore ^ (1.9%)
Commercial and Wholesale Banking exhibited
the strongest performances driven by revenue Others** 21.9% Others** 3.3%
growth and lower provisions, while Consumer Group 6.7% Group 5.8%
PBT was adversely affected by topline
weakness and MFRS9-related adjustments. Notes:
^ In local currency
– Indonesia PBT eased 20.2% YoY to RM1.07 # Based on geographical location of counterparty, excluding bad bank
billion, mainly attributed to higher loan loss ** Including Labuan, London, Cambodia, Vietnam, Hong Kong & Shanghai
provisions arising from a few Corporate
customers in 2019. CIMB Niaga’s underlying
performance was strong as gross loans grew – PBT from Singapore grew 18.8% YoY to RM505 million led by loan growth of
3.0% despite the recalibration of its mid-sized 3.7%, improved NIM from 1.22% in 2018 to 1.30% in 2019 and lower provisions
Commercial Banking business lines, as in all the business segments.
Consumer loans chalked solid market share
gains. NIMs improved by 19bps to 5.31%
over the 12-month period (5.12% in 2018) as FINANCIAL POSITION
lending rates normalised following the interest
rate cuts in 2018. Operating expenses were – The Group maintained a strong capital accumulation trajectory, ending 2019
strictly controlled as CIMB Niaga’s CIR with a CET1 ratio of 12.9%, a 40bps YoY increase from 12.5% a year before.
improved to 49.1% from 50.2% previously. This was achieved despite a higher 50.9% dividend payout with a lower
electable DRS.
– Thailand reaped the benefits of its Fast
Forward strategic plan with a solid 24.1% YoY – Capital adequacy and efficiency remains a pertinent focal point both for
improvement in its PBT. Stronger CIMB Thai regulatory and operational requirements. In line with the Forward23 target of a
revenues emanated from NII growth, driven 13% CET1 in 2023, the Group will strategically manage its capital via: (i)
by a 6.1% YoY loan growth coming mainly continued prudent liability management, (ii) evaluation of options within the
from Consumer (+12.3% YoY) and Corporate dividend reinvestment scheme, (iii) RAROC driven capital deployment, (iv)
Banking (+3.9%), while NOII strengthened RWA-optimisation exercises and (v) situational and opportunistic divestments.
from wealth management and gains from its
– The Liquidity Coverage Ratio and Net Stable Funding Ratios remains
NPL sale. Loan loss provisions were
comfortably above target levels and regulatory requirement, with high quality
significantly lower YoY in line with the
liquid assets recording improvement in yields.
recalibrated loan portfolio.

36
– Forward23 strategic plans will drive the Group’s capital C) COMPLIANCE
deployment and ensure optimal utilisation within the target
The Group continues to view Compliance as a key priority. We
markets and business segments. We have put in place various
have strengthened the management bench and undertaken
initiatives across our jurisdictions which are anticipated to
extensive education measures to heighten awareness across
generate stronger returns on capital in the foreseeable future.
all lines of defence. Our far-reaching governance framework
has resulted in holistic policies and procedures, backed by
RETURNS TO SHAREHOLDERS experienced and capable committees. The compliance culture
will be continuously reiterated regionally via staff training and
The Board approved and declared total dividends amounting to awareness campaigns.
RM2.55 billion or 26.00 sen per share to be distributed to
shareholders for FY19. The first interim dividend of 14.00 sen per D) PEOPLE AND CULTURE
share was paid in November 2019, with a DRS take up rate of
A conducive work environment goes a long way in improving
66.5% while the remainder was paid out by cash. The proposed
staff productivity. The Group Human Resource division drives
second interim single-tier dividend of 12.00 sen per share is to be
continuous employee engagement initiatives to encourage
paid wholly in cash in April 2019 without a DRS option. With this,
participation via projects, workshops and events. With the
the full year DRS implies an average electable portion of 54% for
Forward23 target of achieving 30% of employees to be
2019. The dividends translated to a payout ratio of 50.9%, on the
3D-enabled, various arrangements, programmes and
BAU net profit.
exercises have been launched. This is to strengthen the staff
digital knowledge and capabilities to ensure improved
NON-FINANCIAL ME ASURES OF PERFORMANCE competency and productivity.

Non-financial measures remain relevant components in evaluating

the success of our initiatives towards achieving our strategic goals. G O I N G F O R WA R D
Some of these key measures include:
We completed the first year of our 5-year Forward23 strategic plan
in good stead, with numerous projects in various states of progress
A) SUSTAINABILITY
and showing significant promise to spearhead the Group towards
Sustainability is now a core area for the Group to ensure that achieving its financial targets in 2023. Investments will continue this
economic, environmental and social (EES) considerations are year to future-proof the organisation and establish growth drivers to
integrated into the Group’s risk assessment and management ensure that the Group is stronger and better positioned to face
strategies. During the year, the Group became a founding competition and adapt to the changing operating landscape.
member of the United Nations’ Environment Program Finance
Initiative Principles for Responsible Banking (UNEP-FI). We Nevertheless, we recognise the risk posed by the continued
also launched the Group Sustainability Policy and Group domestic, regional and global economic and macro challenges.
Sustainable Financing Policy in 2019 and will continue to The declining interest rate environment and threat posed by the
expand its scope going forward. As part of CIMB's Forward23 Covid-19 outbreak postures management to exercise heightened
plans, we aim to maintain focus on creating net positive caution in approaching growth and business opportunities. Risk
impact to all stakeholders. management and asset quality monitoring will be of utmost priority
and we will focus on growing loans prudently to improve our market
B) CUSTOMER CENTRICITY position and profitability. Similarly, cost management remains a top
priority to drive efficiency and maximise returns amidst a cautious
With Customer Experience (CX) now entrenched as a core
environment.
CIMB culture, the wider more-expansive Customer Centricity
pillar was added as a Forward23 focus. This pillar focuses on
Going into the new decade, our financial targets for 2020 are an
enhancing the customer journey to remove any existing or
ROE of between 9.0-9.5%, Return of Tangible Common Equity
potential roadblocks, simplifying processes from on-boarding
(ROTCE) of 10.8-11.3%, CET1 ratio of more than 12.0%, CIR of
to completion, and providing a differentiated customer
below 53.4% and LLC of between 0.40-0.50%. The Group’s loan
proposition. The elevation of customer satisfaction is expected
growth is projected at 6% for 2020, with the continued objective of
to translate to improved Net Promoter Scores (NPS), as it
selective market share gains in Malaysia and Indonesia,
already has in Indonesia, and plays a pertinent role in risk
supplemented by opportunistic growth in Thailand and Singapore.
mitigation, minimise negative perception and ultimately,
meeting regulatory requirements.

37
five-year group

GROSS LOANS DEPOSITS FROM CUSTOMERS^

(RM’000) (RM’000)
297,822,144

323,719,559

324,218,054

346,290,529

369,491,503

320,509,026

338,530,629

356,994,529

379,671,991

401,681,309
2015 2016 2017 2018 2019 2015 2016 2017 2018 2019

ROE GROSS DIVIDEND PER SHARE

(%) (Sen)
11.4

14.0

20.0

25.0

25.0

26.0
7.3

8.3

9.6

8.5

2015 2016 2017 2018 2019 2015 2016 2017 2018 2019

TOTAL CAPITAL RATIO (CIMB BANK)

(%)

^ Include investment accounts of

customers and structured
15.8

16.2

16.8

18.4

18.7

investments classified as financial

liabilities designated at fair value
2015 2016 2017 2018 2019 through profit or loss and other
liabilities

38
 five-year group

Financial Year Ended 31 December

2019 2018 2017 2016 2015
Key Highlights RM’000 RM’000 RM’000 RM’000 RM’000
Consolidated Statement of Income
Operating income 17,795,879 17,381,9 68 17,626,49 6 16,065,255 15,395,790
Overheads 9,872,905 8,655,821 9,133,575 8,651,690 9,248,978
Profit before expected credit losses 7,922,974 8,726,147 8,492,921 7,413,565 6,146,812
Expected credit losses on loans, advances and
financing 1,638,785 1,432,661 2,230,907 2,408,883 2,168,624
Profit before taxation and zakat 5,974,840 7,200,667 6,109,985 4,884,144 3,913,993
Net profit for the financial year 4,559,656 5,583,510 4,475,175 3,564,19 0 2,849,509
Consolidated Statement of Financial Position
Gross loans, advances and financing 369,491,503 346,290,529 324,218,054 323,719,559 297,822,144
Total assets 573,245,655 534,089,043 506,499,532 485,766,887 461,577,143
Deposits from customers^ 401,681,309 379,671,991 356,994,529 338,530,629 320,509,026
Total liabilities 515,776,579 481,501,072 456,693,097 438,687,729 419,344,515
Shareholders’ funds 56,237,171 51,374,29 5 48,245,479 45,308,175 41,050,778
Commitments and contingencies 1,146,023,486 1,129,138,654 875,879,316 888,167,213 883,583,439
Financial Ratios (%)
Common equity tier 1 ratio (CIMB Group) 12.9 n/a n/a n/a n/a
Tier 1 ratio (CIMB Group) 14.0 n/a n/a n/a n/a
Total capital ratio (CIMB Group) 16.8 n/a n/a n/a n/a
Common equity tier 1 ratio (CIMB Bank) 13.0 12.2 11.9 11.5 11.5
Tier 1 ratio (CIMB Bank) 14.4 13.7 13.3 13.1 12.7
Total capital ratio (CIMB Bank) 18.7 18.4 16.8 16.2 15.8
Return on average equity 8.5 11.4 9.6 8.3 7.3
Return on average total assets 0.82 1.07 0.90 0.75 0.65
Net interest margin 2.46 2.50 2.63 2.63 2.66
Cost to income ratio 55.5 49.8 51.8 53.9 60.1
Gross impaired loans to gross loans 3.1 2.9 3.4 3.3 3.0
Allowance coverage ratio 80.7 91.0 70.5 79.8 84.7
Loan loss charge 0.44 0.41 0.69 0.74 0.73
Loan deposit ratio 92.0 91.2 90.8 95.6 92.9
Net tangible assets per share (RM) 4.70 4.39 4.14 3.92 3.63
Book value per share (RM) 5.67 5.37 5.23 5.11 4.81
CASA ratio 34.4 32.7 35.0 35.7 34.1
Other Information
Earnings per share (sen)
– basic 47.0 59.7 49.6 41.0 33.6
Gross dividend per share (sen) 26.0 25.0 25.0 20.0 14.0
Dividend payout ratio (%) 56 42 51 49 42
Number of shares in issue* (’000) 9,922,966 9,564,455 9,225,547 8,868,384 8,527,272
Weighted average number of shares in issue (’000) 9,705,987 9,356,695 9,016,943 8,689,362 8,475,522
Non Financial Highlights
Share price at year-end (RM) 5.15 5.71 6.54 4.51 4.54
Number of employees~ 35,265 36,104 37,597 38,952 40,545

^ Include investment accounts of customers and structured investments classified as financial liabilities designated at fair value through profit or loss and other liabiliities
~ Excludes headcount borne by third parties
* Excludes 4,908 ordinary shares held as treasury shares

39
simplified group

ASSETS

6.6% 9.0% 6.7% 9.6%

2.0% 1.5%

19.5% 19.0%

2019 2018

62.9% 63.2%

Cash and short term funds, Portfolio of financial Statutory deposits with Other assets (including
reverse repurchase investments central banks intangible assets)
agreements and deposits and
placements with banks and Loans, advances
other financial institutions and financing

LIABILITIES
0.1% 0.1%
5.3% 0.2% 5.1% 0.2%
4.5% 4.5%

7.4% 6.8%

68.4% 69.3%
9.4% 9.9%

2019 2018
4.1% 3.8%
0.6% 0.3%

Deposits from customers Deposits and placements of Debt securities issued and Reserves
banks and other financial other borrowed funds
Investment accounts of institutions Perpetual preference shares
customers Ordinary share capital
Bills and acceptances payable Non-controlling interests
and other liabilities

40
 quarterly

2019

RM’000 Q1 Q2 Q3 Q4

Operating revenue 4,166,146 4,468,851 4,638,445 4,522,437

Net interest income 2,461,543 2,376,781 2,567,740 2,677,854

Net non-interest income and income from

Islamic banking operation 1,704,603 2,092,070 2,070,705 1,844,583

Overheads (2,302,416) (2,293,626) (2,786,392) (2,490,471)

Profit before taxation and zakat 1,603,126 1,955,829 1,336,883 1,079,002

Net profit attributable to owners of the Parent 1,192,042 1,508,625 1,010,348 848,641

Earnings per share (sen) 12.46 15.60 10.36 8.56

Dividend per share (sen) – 14.00 – 12.00

2018

RM’000 Q1 Q2 Q3 Q4

Operating revenue 4,303,311 4,863,578 4,140,536 4,074,543

Net interest income 2,419,783 2,367,316 2,413,467 2,433,874

Net non-interest income and income from

Islamic banking operation 1,883,528 2,496,262 1,727,069 1,640,669

Overheads (2,141,121) (2,087,316) (2,158,346) (2,269,038)

Profit before taxation and zakat 1,742,893 2,459,160 1,486,401 1,512,213

Net profit attributable to owners of the Parent 1,305,874 1,980,783 1,179,718 1,117,135

Earnings per share (sen) 14.15 21.29 12.56 11.67

Dividend per share (sen) – 13.00 – 12.00

41
key interest bearing

Financial Year Ended 31 December 2019

Interest
As at Effective income/
31 December interest rate expense
RM’million % RM’million

Interest earning assets:

Cash and short-term funds & deposits and placements with banks and other
financial institutions 42,564 2.39 1,111

Financial investments at fair value through profit or loss 38,137 2.78 1,068

Debt instruments at fair value through other comprehensive income 33,318 3.63 1,227

Debt instruments at amortised cost 39,833 4.40 1,765

Loans, advances and financing 360,340 5.88 20,476

Interest bearing liabilities:

Total deposits* 429,482 2.57 11,007

Bonds, Sukuk, debentures and other borrowings 28,691 3.57 925

Subordinated oligations 13,521 5.33 710

Financial Year Ended 31 December 2018

Interest
As at Effective income/
31 December interest rate expense
RM’million % RM’million

Interest earning assets:

Cash and short-term funds & deposits and placements with banks and other
financial institutions 39,903 2.52 1,214

Financial investments at fair value through profit or loss 29,511 2.90 789

Debt instruments at fair value through other comprehensive income 32,276 4.28 1,327

Debt instruments at amortised cost 39,269 3.92 1,542

Loans, advances and financing 337,148 5.89 19,069

Interest bearing liabilities:

Total deposits* 405,131 2.51 10,100

Bonds, Sukuk, debentures and other borrowings 23,022 4.04 908

Subordinated oligations 13,482 5.61 744

* Total deposits include deposits from customers, investment accounts of customers, deposits and placements of banks and other financial institutions, financial
liabilities designated at fair value through profit or loss and structured deposits.

42
 value added

2019 2018
RM’000 RM’000

VALUE ADDED
Net interest income 10,083,918 9,634,440
Income from Islamic banking operations 3,040,663 2,610,161
Net non-interest income 4,671,298 5,137,367
Overheads excluding personnel costs, depreciation and amortisation (3,263,700) (3,065,699)
Expected credit losses on loans, advances and financing (1,638,785) (1,432,661)
Expected credit losses written back for commitments and contingencies 12,019 7,427
Other expected credit losses made (352,018) (134,500)
Share of results of joint ventures 31,401 30,678
Share of results of associates (751) 3,576

Value added available for distribution 12,584,045 12,790,789

DISTRIBUTION OF VALUE ADDED

To employees:
Personnel costs 5,764,674 4,926,747
To the Government:
Taxation and zakat 1,519,653 1,537,314
To providers of capital:
Cash dividends paid to shareholders 797,515 376,094
Non-controlling interests (104,469) 79,843
To reinvest to the Group:
Dividend reinvestment plan 1,712,059 1,948,524
Depreciation and amortisation 844,531 663,375
Retained earnings 2,050,082 3,258,892

Value added available for distribution 12,584,045 12,790,789

36.6% 45.9%
45.8% 38.5%

2019 2018

5.5%
12.1% 12.0%
3.6%

To Employees: To the Government: To providers of capital: To reinvest to the Group:

Personnel costs Taxation and zakat Cash dividends paid to Dividend reinvestment plan
shareholders Depreciation and amortisation
Non-controlling interests Retained earnings

43
capital

OVERVIEW
Capital management at CIMB Group (“Group”) (b) take advantage of strategic acquisitions and new
remains focused on maintaining a healthy capital businesses when opportunities arise; and (c) optimise the
position through building an efficient capital return on capital for the Group.
structure. The capital position and structure of
(3) To maintain capital at optimal levels to meet the requirements
the Group are designed to meet the requirements
of other stakeholders of the Group, including rating agencies
of the Group’s key constituencies i.e.
and customers through (a) liability management (b) dividend
shareholders, customers, regulators, external rating agencies, and
reinvestment scheme (c) deployment of capital based on
others. Guided by CIMB Group’s Capital Management
risk-adjusted return on capital (RAROC) performance
Framework, the objectives of capital management are as follows:
measurement (d) risk-weighted assets (RWA) optimisation
(1) To maintain a strong and efficient capital base for the Group exercise and exploring strategic divestments, if any.
and its entities to (a) meet regulatory capital requirements at
all times; (b) realise returns for shareholders through The Group’s regulated banking entities have always maintained a
sustainable return on equity and stable dividend payout; and set of internal capital targets which provide a strong buffer above
(c) withstand stressed economic and market conditions. the minimum regulatory requirements. The following table shows
the relevant capital ratios of each of the regulated banking entities
(2) To allocate capital efficiently across the business units and
of the Group in comparison to the minimum level required by the
subsidiaries to (a) support the organic growth generation
respective central banks under the Basel III framework.

Common Equity Tier 1 Capital Tier 1 Capital Total Capital

As at Minimum As at Minimum As at Minimum
31 December Regulatory 31 December Regulatory 31 December Regulatory
Capital Ratios 2019 Ratio 2019 Ratio 2019 Ratio
CIMB Group 12.88% 7.00% 13.99% 8.50% 16.75% 10.50%
CIMB Bank 13.03% 7.00% 14.43% 8.50% 18.72% 10.50%
CIMB Islamic 13.35% 7.00% 13.78% 8.50% 16.98% 10.50%
CIMB Investment Bank Group 61.55% 7.00% 61.55% 8.50% 61.55% 10.50%
CIMB Niaga Group* 20.20% 10.00% 20.20% 11.50% 21.50% 13.50%
CIMB Thai Group 13.05% 7.00% 13.05% 8.50% 17.9 5% 11.00%
* Inclusive of risk profile no 2 and capital surcharge buffer.

K E Y I N I T I AT I V E S electable portion of 14.00 sen per ordinary share which shareholders

could elect to reinvest in new ordinary shares in accordance with the
Our goal is to continuously build capital towards the full implementation DRS. Following the completion of the DRS, a total cash dividend of
of Basel III requirements, whilst optimising its use fully. Tools that RM456,454,563 was paid on 4 November 2019.
are employed to achieve this include but not limited to the following:
(1) liability management via redemption of non Basel III compliant A second interim single tier dividend of 12.00 sen per ordinary
instruments; and issuance of new Basel III instruments; share, on 9,922,966,350 ordinary shares amounting to
RM1,190,755,962 in respect of the financial year ended 2019 was
(2) dividend reinvestment scheme (DRS);
approved by the Board of Directors on 30 January 2020. The
(3) RWA optimisation; and second interim single tier dividend will be payable by April 2020 and
(4) Group-wide stress testing and impact assessment. is not applicable under the dividend reinvestment scheme.

Key capital management initiatives that were undertaken during the

DIVIDEND REINVESTMENT SCHEME
2019 calendar year include:
(1) The DRS was continued with a reinvestment rate of 66.5%, The DRS was implemented in 2013 to provide shareholders with an
reflecting investor confidence in the Group and generating an option to reinvest dividends into new ordinary shares of CIMB and
additional RM0.9 billion of capital. at the same time to help preserve the Group’s capital. It was first
(2) CIMB Group issued RM1.0 billion Basel III AT1 Capital applied to the Group’s second interim dividend for the financial year
Securities on 28 June 2019, and RM0.8 billion Basel III T2 ended 31 December 2012. The dividend reinvestment rate has
Subordinated Debt on 25 November 2019. been encouraging, with an average rate of approximately 79.0%
since inception.
(3) The continuing RWA optimisation initiatives during the year,
largely through active loan portfolio rebalancing, system and 49.5% 51.0% 50.8% 50.9%**

data enhancements and model recalibrations. 40.4% 41.9%

25.00 25.00 26.00
20.00
15.00
D I V I D E N D P O L I CY 14.00

For the financial year ended 31 December 2019, the first interim
single tier dividend of 14.00 sen per ordinary share, on 9,727,419,028 2014 2015 2016 2017 2018 2019
ordinary shares amounted to RM1,361,838,664 was approved by the Total Payout Ratio
Board of Directors on 31 July 2019. The dividend consisted of an
* Payout ratio based on PAT excluding CPAM and CPIAM gain of RM928 million.
** Payout ratio based on BAU PAT excluding transformational cost.
44
 credit

  CIMB BANK BERHAD

Rating
Rating Agency Rating Date Rating Classification Accorded Outlook

Moody’s Investors September 2019 1. Long-term Foreign Currency Bank Deposits Rating A3
Service (Moody’s) 2. Short-term Foreign Currency Bank Deposits Rating P-2
3. Long-term Domestic Currency Bank Deposits Rating A3
4. Short-term Domestic Currency Bank Deposits Rating P-2
5. Senior Unsecured Notes A3 Stable
6. USD1.0 billion Multi-Currency Euro Medium Term Notes (P)A3
Programme
7. USD5.0 billion Euro Medium Term Note Programme (P)A3/(P)Ba1
(Senior Unsecured/Subordinated)

Standard & Poor’s December 2019 1. Long-term Foreign Currency Rating A-

Ratings Services 2. Short-term Foreign Currency Rating A-2
Stable
(S&P) 3. Long-term Local Currency Rating A-
4. Short-term Local Currency Rating A-2

RAM Rating August 2019 1. Long-term Financial Institution Rating AAA

Services Berhad 2. Short-term Financial Institution Rating P1
(RAM) 3. RM10.0 billion Tier 2 Basel III Compliant Subordinated
Debt Programme
a. Issuances prior to 1 January 2016 with non-viability AA1
events linked to CIMB Bank Berhad
Stable
b. Issuances on or after 1 January 2016 with non- AA 2
viability events linked to CIMB Bank Berhad as well as
CIMB Group Holdings Berhad and its subsidiaries
4. RM10.0 billion Additional Tier-1 Capital Securities A1
Programme
5. RM20.0 billion Medium Term Notes Programme AAA

Malaysian Rating November 2019 1. Long-term Financial Institution Rating AAA

Corporation 2. Short-term Financial Institution Rating MARC-1
Berhad (MARC) 3. RM5.0 billion Subordinated Debt and Junior Sukuk AA+/AA+IS Stable
Programmes
4. RM10.0 billion Tier 2 Subordinated Debt Programme AA+

  CIMB GROUP HOLDINGS BERHAD

Rating
Rating Agency Rating Date Rating Classification Accorded Outlook

Moody’s Investors September 2019 1. Long-term Issuer Rating Baa1

Stable
Service (Moody’s) 2. Short-term Issuer Rating P-2

Malaysian Rating November 2019 1. Long-term Corporate Credit Rating AA+

Corporation 2. Short-term Corporate Credit Rating MARC-1
Stable
Berhad (MARC) 3. RM10.0 billion Tier 2 Basel III Compliant Subordinated AA
Debt Programme

RAM Rating August 2019 1. Corporate Credit Rating AA1

Services Berhad 2. Corporate Credit Rating P1
(RAM) 3. RM6.0 billion Conventional and Islamic Medium-term AA1
Notes Programme
Stable
4. RM3.0 billion Subordinated Notes Programme AA3
5. RM6.0 billion Conventional Commercial Paper Programme P1
6. RM10.0 billion Additional Tier-1 Capital Securities
Programme A1

45
credit ratings

  CIMB INVESTMENT BANK

Rating
Rating Agency Rating Date Rating Classification Accorded Outlook

RAM Rating August 2019 1. Long-term Financial Institution Rating AAA

Services Berhad 2. Short-term Financial Institution Rating P1 Stable
(RAM)

Moody’s Investors January 2019 1. Long-term Issuer Rating A3

Stable
Service (Moody’s) 2. Short-term Issuer Rating P-2

  CIMB ISL AMIC BANK

Rating
Rating Agency Rating Date Rating Classification Accorded Outlook

Moody’s Investors September 2019 1. Long-term Foreign Currency Bank Deposits Rating A3
Service (Moody’s) 2. Short-term Foreign Currency Bank Deposits Rating P-2
Stable
3. Long-term Domestic Currency Bank Deposits Rating A3
4. Short-term Domestic Currency Bank Deposits Rating P-2

RAM Rating August 2019 1. Long-term Financial Institution Rating AAA

Services Berhad 2. Short-term Financial Institution Rating P1 Stable
(RAM) 3. RM10.0 billion Sukuk Wakalah Programme AAA

Malaysian Rating November 2019 1. Long-term Financial Institution Rating AAA

Corporation 2. Short-term Financial Institution Rating MARC-1
Stable
Berhad (MARC) 3. RM5.0 billion Tier 2 Junior Sukuk Programme AA+IS
4. RM10.0 billion senior Sukuk Wakalah Programme AAAIS

  CIMB THAI

Rating
Rating Agency Rating Date Rating Classification Accorded Outlook

Moody’s Investors May 2019 1. Long-term Issuer Rating Baa2

Service (Moody’s) 2. Long-term Foreign Currency Bank Deposits Rating Baa2
3. Short-term Foreign Currency Bank Deposits Rating P-2 Stable
4. Long-term Domestic Currency Bank Deposits Rating Baa2
5. Short-term Domestic Currency Bank Deposits Rating P-2

RAM Rating September 2019 1. Long-term Financial Institution Rating AA 2

Services Berhad 2. Short-term Financial Institution Rating P1 Stable
(RAM) 3. RM2.0 billion Tier 2 Subordinated Debt Programme AA3

Fitch Ratings September 2019 1. Long-term National Rating AA-(tha)

2. Short-term National Rating F1+(tha)
Stable
3. Long-term Rating on Subordinated Lower Tier 2 AA-(tha)
4. Short-term Rating for Short-term Debt F1+(tha)

46
   C I M B N I AG A

Rating
Rating Agency Rating Date Rating Classification Accorded Outlook

Fitch Ratings April 2019 1. Long-term Issuer Default Rating BBB-

2. Short-term Issuer Default Rating F3
3. Long-term National Rating AA+(idn) Stable
4. Short-term National Rating F1+(idn)
5. IDR1.6 trillion Subordinated Debt AA-(idn)

Moody’s Investors November 2019 1. Long-term Issuer Rating Baa2

Service (Moody’s) 2. Long-term Foreign Currency Bank Deposits Rating Baa2
3. Short-term Foreign Currency Bank Deposits Rating P-2 Stable
4. Long-term Domestic Currency Bank Deposits Rating Baa2
5. Short-term Domestic Currency Bank Deposits Rating P-2

47
balance sheet

The core functions of the Balance Sheet Management team include generating balance sheet strategies
and providing guidance to business units on sustainable value creation for the Group by optimising
structural funding and liquidity profile of the Group’s Banking book. The team also maintains a robust and
responsive Funds Transfer Pricing (FTP) framework, which is governed by the Group Asset Liability
Committee (GALCO). The FTP mechanism is reviewed and calibrated based on best market practices and
various regulatory principles while accommodating for balance sheet strategies as approved by the
management and the Board of Directors.
Other Assets 6.6% 9.7% Treasury
The FTP framework promotes an efficient Group-wide allocation of 2019 Liabilities
Loans, Advances 8.1%
funding costs and benefits to the business units by taking into and Financing
Long-Term
account the interest rate and liquidity positions of the Bank. In Other Assets 6.6% 9.7% Treasury
Debts
ensuring sustainable balance sheet funding, a liquidity premium is Cash & Liabilities
Deposits &
Loans, Advances 8.1%
charged to the user of funds based on the tenure of the Short-Term Funds Long-Term
Investment
and Financing
transactions; and liquidity credit incentivises to the provider of funds 62.9% Debts
Accounts from
Financial
that generate long-term, stable funding. Presently, we focus on Cash &
Instruments 69.0% Customers
Deposits &
attracting stable retail deposits to provide sustainable funding Short-Term Funds Investment
Other Liabilities
62.9% Accounts from
required to extend long-term retail and SME credit that are Financial Total Equity
Instruments 69.0% Customers
beneficial to the economic livelihood of the society. 6.6%
Other Liabilities
The Group maintains a robust liquidity profile to comply with internal 23.9% 3.2% Total Equity
measures that adhere to the best market practices as guided by the 6.6% 10.0%
Basel Standards. The Group also observes Basel III Liquidity
Assets Liabilities
Framework, namely the Liquidity Coverage Ratio (LCR), with a 23.9% 3.2%
primary focus on ensuring a sufficient buffer of liquid assets to 10.0%
survive a significant stress scenario lasting 30 calendar days.
Assets Liabilities

Balance Sheet Management team is responsible in implementing

the Base Rate (BR) Framework in Malaysia. BR is computed in
2018
accordance with the methodology approved under Reference Rate
Framework of Bank Negara Malaysia (BNM). The team monitors the Other Assets 6.6% 9.6% Treasury
effective base rate and notifies the trigger event to GALCO on the Liabilities
Loans, Advances 8.0%
change of BR, facilitating management decision-making. The Long-Term
deployment of BR enables the Group to support efficient financial and Financing
Other Assets Treasury
6.6% 9.6% Debts
intermediation and monetary policy transmission while at the same Cash & Liabilities
Deposits &
Loans, Advances 8.0%
time remaining competitive through transparent asset pricing. Short-Term Funds Long-Term
Investment
and Financing
63.1% Debts
Accounts from
Financial
The loans, advances and financing of the Group’s assets is funded Cash &
Instruments 69.6% Customers
Deposits &
from a funding mix comprising of customer deposits and Short-Term Funds Investment
Other Liabilities
investment accounts alongside stable long-term borrowings such 63.1% Accounts from
Financial Total Equity
as senior funding, subordinated obligations, as well as securitised Instruments 69.6% Customers
6.7%
assets. Our core source of funding, deposits and investment Other Liabilities
accounts from customers have shown steady and resilient growth 3.0% Total Equity
23.6%
of 5.8% in 2019, with a slight decrease in composition in the overall 6.7% 9.8%
funding source but still reflects a healthy buffer in funding the loan
book. Loans, advances and financing grew by 6.7% in 2019 leading Assets Liabilities
23.6% 3.0%
to a sustainable increase of net interest income for the Group. 9.8%

Assets Liabilities

LCR
The Group maintained a healthy level of liquid assets which is reflected by a Liquidity Coverage Ratio of 185% as
at 31 December 2019, which is well above the minimum requirement of 100% for 2019. The bank also observes
its level of liquidity using indicators such as loans-to-funding (LTF) which includes debt issuances in addition to
deposits while loan-to-fund-and-equity (LTFE) expands on with the inclusion of equity. The measure for LTF and
LTFE for the Group as at 31 December 2019 is 81% and 72% respectively. Given the introduction of new liquidity
measures such as LCR in the recent years and upcoming implementation of Net Stable Funding Ratio (NSFR), the
Group has been focusing on the growth of high quality liquid assets as well as sticky deposits in ensuring a sustainable liquidity
buffer not only to survive a significant stress scenario lasting 30 calendar days but also for longer time horizons.

48
 investor

The Group’s Investor Relations initiative for the year was centered on ensuring that the investment community
had a thorough understanding of the Forward23 5-year strategic plan launched in early 2019. Having drawn a
line under the previous Target 2018 (T18) program, it was imperative that stakeholders grasped how the Group
would leverage on the foundations laid by T18 to accelerate growth in key focus areas to strengthen the digital
and technological core to future-proof the Group. With Customer Centricity, Ventures & Partnerships and
Sustainability coming to the fore as strategic pivots under Forward23, we took the opportunity to outline how
and why these focus areas could prove to be a major differentiator for CIMB.

The operating environment was challenging as external regional We ensured that pertinent domestic and foreign stakeholders had
and global developments took center stage. The backdrop of regular, consistent and proactive engagements with the upper
slower regional economic growth, continued global trade tensions, echelons of CIMB Group management. Significant effort is put in to
unexpected monetary policy moves by regional central banks and coordinate direct one-on-one meetings, teleconferences,
the corresponding deceleration in corporate activity and weakened roadshows and investor conferences to facilitate these
consumer sentiment, impacted investor confidence and sentiment. engagements, subject to management availability. The Group CEO
The rapidly evolving landscape has become a norm and the Tengku Dato’ Sri Zafrul Tengku Abdul Aziz and Group CFO Khairul
Investor Relations team had to stay on our toes to keep pace with Rifaie led the investor relation activities with support from the
these developments. Investor Relations team and selected members of senior
management where necessary. These include Shahnaz Jammal
The Group itself had a comparatively unexciting year in terms of (CEO Group Wholesale Banking), Gurdip Singh Sidhu (Group Chief
corporate developments with the completion of the disposal of 50% Strategy & Design Officer) and Tigor M. Siahaan (CEO of CIMB
interest in the Malaysian stockbroking business. Management spent Niaga).
significant effort in improving operational efficiencies via automation
and partnerships as well as launching a staff transformation SIGNIFICANT EVENTS:
program in Malaysia and Indonesia. This entailed a material uplift in
operating costs, which had to be clarified and relayed to investors. Date Event
The announcement of the Group Sustainability Policy and Group
31 January Completed divestment of 51% Bursa
Sustainable Financing Policy was defining as it sets a landmark on
2019 interest in CIMB Howden Announcement
the way CIMB Group approached business going forward, in line
Insurance Brokers
with the increased resonance of environmental, social and
governance (ESG) issues within the investment community. 2019 28 June 2019 Completed sale of 50% interest Bursa
was also a year where CIMB Bank Philippines emerged as the in the Malaysia stockbroking Announcement
fastest growing bank in ASEAN, accumulating 1.7 million customers business
within a year of operations.
13 Appointment of Victor Lee Meng Bursa
September Teck as CEO of CIMB Bank Announcement
The Group has not wavered from its belief in providing the highest
2019 Singapore and Ahmad
levels of transparency and disclosures where possible, to further
Shahriman Bin Mohd Shariff as
inculcate trust and confidence in management. The 5-year
CEO of CIMB Islamic Bank
Forward23 strategic plan reverberated well with foreign long-only
Berhad
funds, bringing about an increase in the Group’s foreign
shareholding over the past 12 months. Nevertheless, issues that 21 October Appointment of Adisorn SET
weighed on the Group’s share price and financial sector in general, 2019 Sermchaiwong as President and Announcement
included the Overnight Policy Rate (OPR) cut by Bank Negara CEO of CIMB Thai Bank PCL
Malaysia, slower trade flows and capital market activity arising from
the continued US-China trade war and subsequently the political
and social unrest in Hong Kong and concerns of encroachment by
digital banks and e-payment solution providers into the banking
space. The negative external newsflow coupled with decelerating
economic growth across the region, brought about an
underperformance of the Group’s share price against the market in
2019, although faring comparatively better against most other
financial stocks in Malaysia.

49
investor relations

ANALYST
BRIEFINGS
The Group conducted investor conference Malaysia website, email the documents along with the investor
calls for all quarterly announcements of the presentation to all relevant stakeholders and upload to the
Group’s financial performance, which Group’s website under the Investor Relations segment.
facilitated full participation from domestic as
well as regional equity analysts and fund ANNOUNCEMENT OF FINANCIAL RESULTS:
managers. As per previous years, the Group
CEO presented the quarterly and annual financial performances Type of
and took questions for more detailed discussion and explanation. Date Event Meeting
Other members of senior management were on hand to take on
29 May 2019 CIMB Group 1Q19 Results Conference Call
more business-specific and operational queries.
29 August 2019 CIMB Group 2Q19 Results Conference Call
Press conferences are held twice yearly for the half-year and
22 November CIMB Group 3Q19 Results Conference Call
full-year results to provide the media with opportunities to hear the
2019
performance reports directly from senior management. It is the
Investor Relations team’s responsibility to ensure that the financial 28 February CIMB Group 4Q19 Results Conference Call
statements and press releases are lodged onto the Bursa 2020

AGM/EGM

The Board of Directors addressing shareholders at the 62nd AGM.

The Annual General Meeting (AGM) is arguably the Group’s most opinions to both the Board of Directors and senior management.
important event each year where shareholders gather to meet, Official responses were provided to several shareholders and the
listen to and engage with senior management. CIMB Group’s 62nd Minority Shareholders Watchdog Group (MSWG). Management
AGM on 22 April 2019 was equally engaging with the Group CEO took note of queries that could not be immediately addressed and
presenting the 2018 financial performance and report card on the responded directly to the shareholders post-AGM. Topics raised at
T18 achievements. He subsequently unveiled the Forward23 5-year the 62nd AGM included operational prospects for CIMB Niaga and
strategic roadmap by explaining the rationale and objectives of the CIMB Thai, loan growth and NIM outlook, the Board’s remuneration
five key pivots to an appreciative audience. The follow-up structure and asset quality.
shareholder engagement was stimulating with an interactive
audience providing a wide range of questions, feedback and

50
 INVESTOR
MEETINGS
Investor meetings form the crux of the Investor NO. OF MEETINGS/NO. OF FUND MANAGERS AND ANALYSTS
Relations initiative as this allows senior
management to engage investors on a 2018 2019
personal basis. For 2019, the Group Meetings FM/ Meetings FM/
conducted 85 investor meetings, a notable Analysts Analysts
decrease from the 102 in 2018 largely owing
to the cancellations of conferences and non-deal roadshows CIMB Group
(NDR) following the unrest in Hong Kong in the second half of the In-house 37 233 38 199
year. Given the macro developments and the reduction of meetings
business travel and events, the Group ensured that we maintained Conferences 22 106 19 85
as strong an engagement as possible with stakeholders while
Non deal 29 43 18 86
continuing high levels of disclosure and transparency.
roadshows
Nevertheless, the number of buy- and sell-side analysts and fund Teleconferences 14 17 10 15
managers met were similar at 385 versus 399 last year as we Total 102 399 85 385
improved the efficiency of meetings particularly on NDRs. Other
than one-on-one and small group meetings, the Group continued
to conduct twelve regular larger-group meetings per annum; eight CIMB Niaga
pre-closed period meetings with the domestic buy- and sell-side, In-house 16 52 12 48
and four quarterly financial announcement investor briefings and meetings
conference calls. CIMB Niaga also saw a slight decline in the
Total 16 52 12 48
number of meetings and investors met in 2019 as a result of the
macroeconomic developments.

CONFERENCES
AND ROADSHOWS It is pertinent for members of senior management to meet with institutional and strategic stakeholders to provide
up-to-date developments on the Group and the operating environment. Apart from in-house meetings, these are also
best conducted off-site at regional conferences and on NDRs. The Group CEO and/or CFO participated in various
events over 2019 to brief investors on the Group’s Forward23 strategic plan, update on financial performance and
discuss all matters relating to the financial industry. 2019 brought us to Singapore, Hong Kong and London for both
conferences and NDRs with several reverse roadshows in Kuala Lumpur. We participated in our first Sustainability
Conference in Singapore where we had the opportunity to listen to and engage with ESG-focused buy-side investors.

With the lower number of events attended in 2019 due to unexpected events, we had just 37 meetings out of the office during the year
compared to 51 in 2018. Nevertheless, the scarcity of meetings translated to greater interest as we met 171 fund managers and buy-side
analysts in 2019 versus 149 the year before. We continue to utilise the share register analysis to identify and earmark stakeholders who
need to be engaged.

CONFERENCES AND ROADSHOWS

Date Event Location Organiser

3 January 2019 CIMB 11th Annual Malaysia Corporate Day Kuala Lumpur CIMB
12 March 2019 UBS Malaysia Corporate Day Singapore UBS
25 March 2019 Credit Suisse 22nd Asian Investment Conference Hong Kong Credit Suisse
8 – 9 April 2019 Non-Deal Roadshow London Macquarie
18 June 2019 Macquarie ASEAN Banks Tour Kuala Lumpur Macquarie
4 September 2019 Non-Deal Roadshow Singapore JP Morgan
18 September 2019 BNP Paribas Sustainable Future Forum 2019 Singapore BNP Paribas
20 September 2019 UBS ASEAN Conference Kuala Lumpur UBS

51
investor relations

RESEARCH SHARE PRICE

COVERAGE CIMB Group remains well covered by the PERFORMANCE
AND FOREIGN 2019 was not the best of years for
investment community given its position as
SHAREHOLDING Malaysian equities performance as the
the fifth largest company by market
continued trade tensions and tumultuous
capitalisation on Bursa Malaysia as at
global developments exerted persistent
end-2019 and a core component of the
downward pressure. Coupled with the
FBMKLCI Index. The Group remains the
less favourable rebalancing of the MSCI
second largest financial institution in Malaysia by assets and the
indices, the benchmark FBMKLCI declined by 2.8% for the
fifth largest in ASEAN. As of end December 2019, the stock had
year. As a result, the Group’s share price performance was
active coverage by a total of 22 analyst and research houses, and
not spared as it eased by 5.0% over the 12-month period to
continues to be well tracked by buy-side analysts and fund
end the year at RM5.15 compared to the adjusted opening
managers domestically, regionally and globally.
price of RM5.42, translating to a 2.2% underperformance
versus the FBMKLCI in 2019. Nonetheless, CIMB Group
No Research House outperformed the wider Malaysian financial sector (KLFin
Index) which declined by a greater 10.6% in 2019.
1 Affin Hwang Investment Bank
2 AllianceDBS Research From a financial performance perspective, the Group met its
3 AmInvestment Bank targets for ROE, loan growth, CET1 ratio, dividend payout
4 Bernstein Research and loan loss charge. Apart from external market-related
factors which impacted revenues, the Group embarked on
5 BofA Global Research
an investment phase under its Forward23 5-year strategic
6 Citi Investment Research plan, which brought about a sharper than normal increase in
7 CLSA Securities operating expenses and a subsequent miss of the Group’s
8 Credit Suisse Securities CIR target for the year. The interest rate cuts across the
region also contributed to the negative impact on NIMs,
9 Hong Leong Investment Bank
particularly in Malaysia.
10 JP Morgan Securities
11 KAF-Seagroatt & Campbell Securities Despite the weaker market and operating environment, the
12 Kenanga Investment Bank Group witnessed an uptick in its foreign shareholding to
30.2% as at end-2019 compared to 25.9% at the end of
13 Macquarie Capital Securities
2018 – or an increase of 4.3% YoY. Whilst this increase was
14 Maybank Investment Bank aided by the transfer of shares by Khazanah Nasional to its
15 MIDF Amanah Investment Bank trustees in conjunction with its issuance of USD500 million in
16 Morgan Stanley Research exchangeable bonds exchangeable into CIMB Group shares,
the underlying foreign shareholding would still have risen by
17 Nomura Securities
around 1.0% for the year.
18 Public Investment Bank
19 RHB Research
20 TA Securities
21 UBS Securities
22 UOB Kay Hian

CREDIT RATING

Credit ratings play an integral part in how the Group is viewed by institutional investors, counterparty financial
institutions, current and potential business partners as well as direct and indirect external stakeholders. The Group
actively engages the following domestic, regional and global rating agencies – Moody’s Investors Services, Standard
and Poor’s (S&P), RAM Ratings, Malaysian Rating Corporation (MARC) and Fitch Ratings – to provide credit ratings
for the Group and its licensed banking subsidiaries. This is done on both a solicited and unsolicited basis to provide
sufficient local- and foreign-currency rating coverage. The investor relations team manages the relationship with
rating agencies via continuous engagements, particularly during rating review periods with senior members of management through the
year. Detailed financial explanations, data points and strategic discussions equip the rating agencies with the latest information in their
evaluation process. The two-way relationship also allows the Group to receive the latest views and developments on global financial
markets, economies and developments.

52
CIMB Group Share Price and Volume

5.8 120

5.6
100

5.4
80

5.2

60

5.0

40
4.8

20
4.6

4.4 0
Dec 18 Jan 19 Feb 19 Mar 19 Apr 19 May 19 Jun 19 Jul 19 Aug 19 Sep 19 Oct 19 Nov 19 Dec 19

Volume (’mil) (RHS) Price (RM) (LHS)

CIMB Group Foreign Shareholding

32

30.3% 30.2%
30.0%
29.7%
30 29.4% 29.5%

28

26.5%
26.2% 26.2%
25.9% 25.8%
26 25.6% 25.5%

24

22

20
Dec 18 Jan 19 Feb 19 Mar 19 Apr 19 May 19 Jun 19 Jul 19 Aug 19 Sep 19 Oct 19 Nov 19 Dec 19

53
investor relations

Shareholders’ Returns (6 June 2005* – 31 December 2019)

500

450

400

350

50.6%
300

250

200

150

100 1 YEAR 14.5 YEARS

CIMB -5.0% 258.9%
50
FBMKLCI -2.8% 208.3%
0
Jun 05 Jun 06 Jun 07 Jun 08 Jun 09 Jun 10 Jun 11 Jun 12 Jun 13 Jun 14 Jun 15 Jun 16 Jun 17 Jun 18 Jun 19 Dec 19

FBMKLCI Index CIMB

Note: *Date of announcement of the M&A between CIMB Berhad and CAHB

5-year Foreign Shareholding Trend (December 2014 – December 2019)

40

35

30

30.2%

25

20
Dec 14 Dec 15 Dec 16 Dec 17 Dec 18 Dec 19

54
 financial

28 FEBRUARY 2019 14 MARCH 2019 21 MARCH 2019 21 MARCH 2019

Announcement of the
Notice of book closure for
unaudited consolidated
single tier second interim Issuance of Annual Report
financial results for the Notice of 62nd Annual
dividend of 12.00 sen per for the financial year ended
fourth quarter and financial General Meeting
share for the financial year 31 December 2018
year ended 31 December
ended 31 December 2018
2018

25 MARCH 2019 29 MARCH 2019 22 APRIL 2019 24 APRIL 2019

Notice of election in relation

Date of entitlement for the to the dividend reinvestment Payment of the single tier
single tier second interim scheme. The scheme interim dividend of 12.00
62nd Annual General
dividend of 12.00 sen per provides the shareholders sen per share for the
Meeting
share for the financial year with the option to elect to financial year ended
ended 31 December 2018 reinvest their cash dividend in 31 December 2018
new ordinary shares of CIMB

24 APRIL 2019 29 MAY 2019 29 AUGUST 2019 24 SEPTEMBER 2019

Announcement of the Announcement of the Notice of book closure for

Additional listing of
unaudited consolidated unaudited consolidated the single tier first interim
162,964,518 new ordinary
financial results for the first financial results for the dividend of 14.00 sen per
shares, via the Dividend
quarter ended 31 March second quarter and half share for the financial year
Reinvestment Scheme
2019 year ended 30 June 2019 ending 31 December 2019

4 OCTOBER 2019 11 OCTOBER 2019 6 NOVEMBER 2019 6 NOVEMBER 2019

Notice of election in relation

Date of entitlement for the to the dividend reinvestment Payment of the single tier
Additional listing of
single tier interim dividend of scheme. The scheme interim dividend of 14.00
195,547,322 new ordinary
14.00 sen per share for the provides the shareholders sen per share for the
shares via the dividend
financial year ending with the option to elect to financial year ending
reinvestment scheme
31 December 2019 reinvest their cash dividend in 31 December 2019
new ordinary shares in CIMB

2 0 2 0 T E N TAT I V E DAT E S
22 NOVEMBER 2019 28 FEBRUARY 2020

19 MAY 2020 26 AUGUST 2020

Announcement of the Announcement of the
1Q20 Financial Results 2Q20 Financial Results
unaudited consolidated unaudited consolidated
financial results for the third financial results for the
quarter ended fourth quarter ended
24 NOVEMBER 2020 FEBRUARY 2021
30 September 2019 31 December 2019
3Q20 Financial Results 4Q20 Financial Results

55
group “During the year, we continued to drive business growth and key focus
areas towards Forward23 aspirations amidst various market challenges.

consumer We kept our momentum in balance sheet growth while accelerating

efforts in digital banking, analytics, innovation and process

banking re-engineering towards providing best-in-class customer experience.

Our market leadership was reinforced as we received the Best Retail
Bank award for the third consecutive year and the Best Digital Bank
award for 2019 in Malaysia. Overall, we remained committed to driving
banking excellence, delighting customers and contributing towards
by Samir Gupta achieving the Group’s Forward23 objectives.”

WHO WE ARE & WHAT WE DO FINANCIAL PERFORMANCE

We provide conventional and Islamic banking solutions to While competition remained intense, balance sheet growth was
individual customers and small businesses. Our range of resilient, with loans growing steadily at +9.0% YoY, mainly driven
products include deposit accounts; loans; personal financing; by Malaysia and Thailand. Deposits grew +8.9%, driven by
growth in both CASA at +6.9% YoY and FD at +12.0% YoY. In
credit cards; wealth management and investments;
2019, the Group Consumer Banking division registered a +2.3%
bancassurance; remittance and FX. These offerings can be
YoY revenue growth on the back of higher balance sheet growth
accessed through multiple delivery channels, i.e. online banking,
and wealth management income recovery. This is despite
mobile banking, self-service banking via ATM terminals, phone spread compression and rate cuts. Direct expenses were
banking, all of which allows financial transactions to be managed well, but was offset by higher support costs. Overall,
performed beyond normal banking hours. Products & services PBT was lower YoY as a result of slower revenue growth, higher
are also accessible over-the-counter in all our branches provisions compounded by one-off MFRS9-related adjustments
regionally. and higher support costs.

Tapping the potential of digital, big data and advanced analytics, Financials (ex-SME)
backed by a holistic product proposition and an integrated
regional universal banking franchise model, we aim to deliver Loans Deposits CASA
superior customer experience. (RM million) (RM million) (RM million)

OUR GROWTH DRIVERS IN 2019

169,714

184,953

164,402

179,012

58,977

63,046
Overall, we registered positive performance across all our
regional markets. The key growth drivers included mortgages,
2018 2019 2018 2019 2018 2019
personal loans, auto loans and deposits. We grew our market
share in Malaysia and Indonesia for mortgages and deposits. 9.0% YoY 8.9% YoY 6.9% YoY

With the advent of Industrial Revolution 4.0 (IR 4.0), we FD Revenue (as reported)
(RM million) (RM million)
continued to emphasise on “data-first” approach by augmenting
and expanding our digital capabilities. We continued leveraging
big data and advanced analytics for targeted acquisition;
identifying new revenue initiatives and cost saving opportunities;
101,569

113,739

reducing turn-around-time (TAT); improving customer

7,242

7,411

experience (CX), and enhancing sales productivity through

digital sales enablement. We contained costs through prudent 2018 2019 2018 2019
cost management and various cost savings initiatives while 12.0% YoY 2.3% YoY
continuing to invest for the future.

In 2019, innovations and product proposition refreshes were Digital Services Take Up (#‘m)
implemented to stay attuned to the changing consumer
Registered Users Transactions
behaviour. We have improved and refreshed our flagship Internet
on Mobile App on Mobile App
Banking apps across the region to pack new features and
added convenience. Several credit card propositions were
refreshed to give added benefits to customers. We have also
launched a regional deals platform for customers to avail
regional deals and offers. At the core, we are differentiating
ourselves through personalised banking. Supported by big data
120

203
7.8

9.5

analytics, we are now able to provide personalised deals and 2018 2019 2018 2019 *D
 igital Banking stats are
regional (MIST)
offerings to our customers. 22.4% YoY 70.1% YoY

AWARDS & AWARDS AWARDING BODY

RECOGNITION
Best Retail Bank in Malaysia The Asian Banker
Best Digital Bank in Malaysia The Asian Banker
Retail Banker of the Year in Asia Pacific 2019 – Samir Gupta The Asian Banker

56
 H I G H L I G H T S 2 0 19

KEY INITIATIVES RESULTS

STRENGTHEN POSITION AS THE LEADING DIGITAL BANK
• Launched Clicks One App: The only app in Malaysia offering • Registered app users up by +24.3% ; app transactions up by
personalised offers and “always on” home screen enabling for +54.5%
clicks fund transfer of up to RM250.
• Augmented OctoMobile in Indonesia, offering new innovative • Registered app users up by +18.9% ; app transactions up by
features such as account opening with online KYC, QR payments, +89.3%
cardless ATM transactions, etc.
• Launched new CIMB TH Digital App with digital account opening • Recognised as the 1st Bank in Thailand to allow app-based
and wealth management capabilities. primary bond subscription
DIGITAL SALES ENABLEMENT
• Launched EzForm for credit cards and CashPlus loans in Malaysia • Simplified process and more user-friendly; Faster TAT
– an improved process to empower staff referrals/submissions via
mobile phones.
• Rolled-out digital acquisition platform in Malaysia and Singapore • Significant uplift in sales volume e.g. MY CashPlus, SG FastSavers
offering customers straight through application processes. and credit cards. Potential to replicate for other countries.
ANALYTICS DRIVEN REVENUE & COST OPTIMISATION
• Deployed advanced analytics for lead generation, creation of • >RM100 million revenue and cost optimisation opportunities identified
customised offers and branch network realignment initiatives. • Productivity remained robust, with loans per staff up by +16.6%
• Optimised branch footprint while realising cost reduction regionally. YoY and deposits per staff up by +13.2% YoY
• Introduced machine learning for optimisation in AML Alerts. • AML alerts reduced by -40%
• Implemented Robotic Process Automation in Indonesia, • Recognised for Best Productivity, Efficiency & Automation for
contributing to cost optimisation. Contact Centre, Speech Analytics & Robotic Process Automation
by The Asian Banker

C H A L L E N G E S & R I S K M I T I G AT I O N

CHALLENGES/RISK MITIGATION STRATEGIES RESULTS

Regulatory Compliance: • Embraced a zero-tolerance culture for • Reduced operational lapses.
Higher and stricter standards of compliance non-compliance and stakeholder • Enhanced risk profile and returns on risk
coupled with the introduction of new management. adjusted capital.
regulations and standards. • Adopted data-driven risk management
policies and implemented risk-based pricing
strategies.
Rapid Technology Change and • Enhanced budgets to enable technology • Improved system uptime & successful roll
Disruption: change, system resiliency, hiring, compliance out of new digital banking services.
Pressure to re-skill and allocate more and Fintech – all for business growth. • Increased sales and achieved better sales
investments in technology in keeping with the • Introduced value-added digital banking fulfillment rates through data-driven
pace of change. services & increased digital sales delivery. acquisition.
• Encouraged data-driven sales and risk
management.

A NEW BEGINNING – FOCUS AREAS

Customer Experience through Digital Banking Leadership: Affluent Banking and Wealth
Personalised Banking: • Enrichment of flagship mobile banking Management Leadership:
• Customer experience remains top applications with great UI/UX, value- • Recalibration of sales operating model
priority and we endeavour to provide a added features, online account opening with specialised sales roles focussing on
personalised banking experience via eKYC and straight through Preferred Banking customers.
through tailored products, services and application functions for products. • Enhanced Preferred Banking value
offers. • Introduction of personalised and tailored proposition, focussing on regional
• This is achieved by digital banking deals powered by big data engine. privileges, large suite of value-added
expansion and affluent banking wealth management products, seamless
supported by big data/real-time engine, onboarding journeys, relationship-based
transforming customer journeys and pricing and digital wealth.
customer value management initiatives.

OUTLOOK & PROSPECTS

In the year ahead, we remain cautiously we will differentiate ourselves through recognition. With these in place, we
optimistic as the industry will continue to see providing a personalised banking experience endeavour to establish leadership in the area
margin compression, central bank rate cuts (by way of tailored products, services and of digital banking, Preferred Banking and
and global headwinds resulting from possible offers, real time processing, innovative apps, wealth management.
geopolitical conflicts and trade wars. electronic on-boarding etc.), supported by big
data and analytics. As the leading consumer bank in ASEAN, we
High customer expectations, coupled with expect to sustain growth and profitability
continuous industry disruption and the advent Our suite of internet and mobile banking through innovation, continuous process
of new digital banks in view of issuance of solutions will evolve to be more simplified, improvement, efficient cost management and
new digital banking licenses in near future will user friendly, intelligent and personalised service excellence as we move the franchise
determine relevance and competitiveness. offering, complementing our digital acquisition towards meeting its Forward23 goals and
We will continue to innovate to stay ahead. strategy powered by instant decisioning and being the leading consumer bank in ASEAN.
Customer experience remains top priority and new technology such as optical character
57
group “2019 has been a good year for Group Commercial Banking.
Commercial Banking turned in a good set of financial performance.

commercial We bolstered our value proposition for both SME banking and
Business Banking segments. In Malaysia, we outperformed the

banking
market in the SME space. Our SME business grew double digits while
the industry contracted by 1%. In 2019, we made a commitment to
disburse RM15 billion in SME loans in Malaysia in two years. As of
end 2019, we have successfully disbursed more than half of the
committed amount. Anchored on principles of Sustainability and
Customer Experience, we accelerated our commitment in the
by Victor Lee Meng Teck backbone of every country in the SME and Business Banking space,
forging strong relationships with existing customers and growing
new customers. The year also saw us building our digital eco-
systems and partnerships. With our resolve in this phase of
digitalisation, we expect to bear fruits in the coming years.”

WHO WE ARE & WHAT WE DO OUR GROWTH DRIVERS IN 2019

We are a regional business, providing comprehensive financial We have the benefit of a clearly defined Forward23 strategy for
solutions, both conventional and Islamic, to non-retail segments, Group Commercial Banking to navigate us through 2019 and the
ranging from small and medium sized enterprises (SMEs), to coming years ahead with a focus on improving asset quality
mid-corporates. management, leveraging on Credit Guarantee Schemes to
minimise risks, as well as setting up a Regional Operating
We adopt an integrated marketing approach with regards to our Model, with a Centre of Excellence, sharing and implementing
financial product and services, which are tailored to meet the best practices across the Region.
individual needs of our customers. Our end-to-end services
include credit facilities, as well as cash management solutions; In 2019, we adopted a segment-led customer focused strategy
treasury and structured products. These are made available to for growing our business. Examples of these were the launched
our customers through multiple channels such as online Business Premise Plus, a solution that provides working capital
banking, our dedicated relationship managers, SME and funds in addition to asset financing, and programs for solar
business centres; as well as CIMB’s extensive branch network panel financing targeting the SME business segment. For the
across the region. micro finance segment, we introduced e-commerce platform
based lending with partners such as Lazada and Shopee, as
well as through our partner online channel, iMSME. For the
larger Mid-Corp and Medium Enterprise segments, we offered
FINANCIAL PERFORMANCE
tailored working capital and trade financing solutions to
The Group Commercial Banking saw an upswing in profit before complement the more complex needs of these segments.
tax, propelled by sustained growth in loans and significant These efforts resulted in us outgrowing industry loan growth.
improvement in asset quality. Malaysia, Indonesia and Cambodia
were the key levers in delivering the bottom line. With the proliferation of the digital economy, at CIMB, we
continued to build on our inclusive go to market approach by
The sale of non-performing assets in Indonesia, as well as accelerating collaboration with synergistic fintech and digital
improved loan loss charge and impairment ratio across the players in the market. We explored partnership and growth
board further strengthened the financial outcomes for the year. opportunities in the digital ecosystem – from e-Commerce
platform providers to peer to peer micro financing for SMEs, as
well as Investment Banking solutions, leveraging on frontier
technologies such as blockchain.

Profit Before Tax Provisions BizChannel, as well as BizLite, which is the lighter version of our
(RM million) (RM million) online banking platform targeted at our business banking
Profit Before Tax Provisions customers, has been a widely accepted platform by CIMB
(RM million) (RM million) customers in the region. In 2019, we further expanded on our
8 write back

customer experience proposition and seamless banking with

630 charge

the introduction of a mobile app based version of BizChannel.

1,609 1,609

8 write back
860

630 charge

2018 2019 2018 2019 During the year, we also strengthened our business deposits
customer value proposition by working closely with our branch
860

87% YoY 101% YoY

2018 2019 2018 2019 network to drive greater customer experience in the on-boarding
Loans
87% YoY Deposits
101% YoY and servicing process. As a result, we delivered a positive
(RM billion) (RM billion) increase in our business deposits growth.
Loans Deposits
(RM billion) (RM billion) Managing and maintaining a high quality commercial asset book
is essential to a healthy growth of our segment of business. The
year saw our improved loan loss charge, due to our continued
high intensity due diligence and reviews, whilst at the same time
65.5

65.5

65.0

65.6

disposing some non-performing loans.

2018 2019 2018 2019
65.5

65.5

65.0

65.6

0.1% YoY 1% YoY 2019 saw more right sizing of our Thailand business. We exited
2018 2019 2018 2019 subscale segments where our risk rewards profile did not justify.
0.1% YoY 1% YoY This year saw Commercial Banking driving products through its
branch network more. We are seeing early success.

58
 H I G H L I G H T S 2 0 19

KEY INITIATIVES RESULTS

CUSTOMER SOLUTIONS
Enhanced working capital solutions in key markets, namely Higher than industry loans growth in key markets. In Malaysia, we
Malaysia and Indonesia. Introduced new offerings such as 160% are on track to disburse over RM15 billion in loans to SMEs by
margin of financing; solar panel and franchise financing; 2020.
eCommerce merchant micro financing; Quick Cash; and
Merchant Plus programme.
DIGITAL ECO-SYSTEMS
Ramped up our partnerships and collaboration with fin-techs and We have entered into various collaborations in Malaysia, with
digital platform players to expand our customer value proposition in partners such as Axiata, online investment platform Capbridge
the digital eco-system space. This is in tandem with our focus on Pte. Ltd in Singapore, e-Commerce provider Shopmatic, as well
growing our digital SME proposition in the market. as other established platform players such as Lazada and
Shopee.
SUSTAINABLE FINANCING
Encouraged all CIMB Palm Oil industry customers to be Malaysia We have engaged all our customers, of which 95% of customers
Sustainable Palm Oil (MSPO) certified in keeping with our Group are either already MSPO certified or have a clear roadmap to
Sustainable Financing Policy complete their certification within a year.

C H A L L E N G E S & R I S K M I T I G AT I O N

CHALLENGES/RISKS MITIGATION STRATEGIES RESULTS

External headwinds and uncertainties from Focused on attractive industries that are Positive customer response and take-up of
Brexit and US-China trade war impacted aligned to Malaysia 2020 vision. Focused on our lending programmes. We are on track
global economy, weakened global trade being industry leaders in chosen industries. to deliver on our promise to disburse RM15
growth which has weighed on Malaysia’s billion in SME loans by 2020.
export sector. Weakened domestic
business sentiments and soft commodity
prices has also affected performance.

A NEW BEGINNING – FOCUS AREAS

Customer Centricity: Technology & Data: Sustainability: Ventures & Partnerships:

• Enhanced our customer • Devised a segmentation • Worked with our • Leveraged on internal
experience framework strategy, coupled with an customers (especially in CIMB assets and
through digital optimal risk reward Palm Oil) to raise capabilities, such as our
enablement, with appetite and credit awareness on sector- branch network,
innovation as the catalyst infrastructure to ensure we specific risks and Investment Banking,
for customer engagement are able to deliver the right standards, encouraging Treasury, as well as Private
and delight. solutions and services to them to put concrete Banking practice, and
our customers with diverse action and mitigation plans business partners to
interests, needs, and from to improve sustainability deliver greater value to our
different geographical practices. SME and business
areas. banking customers.

OUTLOOK & PROSPECTS

In 2020 and beyond, we will elevate our game in delivering our • Enhancing our SME digital proposition, with quicker financing
value proposition and delighting our customers. This renewed access through digital solutions, as well as deeper partnerships
emphasis is guided by our philosophy in CHIDA – Customer and collaboration with platforms players to create an eco-
obsession; High performance; Integrity; Diversification and system based proposition to our customers.
inclusion; and Agility. • Transforming our key touch points, which are primarily our
online banking, as well as branch channels to ensure that we
CHIDA will be apparent in everything that we do for our customers. deliver on our promise to our customers at the moment of truth.
This includes:
• Digitalisation and automation of our end-to-end credit
processes, to improve turn-around time; simplify credit
application process; and provide transparency for customers.

59
group “Despite a challenging operating environment, we recorded healthy
growth in wholesale banking loans at 7.2% YoY and higher Private

wholesale Banking assets under management (AUM) by 19.3% YoY at RM65.5 billion.
Our Treasury & Markets business achieved commendable double-digit

banking
growth in profit before tax. During the year, we were the sole principal
advisor to a major Oil & Gas client executing Malaysia’s largest block
trade of RM6 billion. This is in addition to our first ever Formosa
Sustainable Development Goals (SDG) Bond of USD680 million issued by a
Malaysian and ASEAN issuer in the international capital markets. We are
proud to have successfully achieved a balance between delivering
by Shahnaz Jammal positive growth and financial performance, and demonstrating our
responsibility to champion sustainable development.”

WHO WE ARE & WHAT WE DO FINANCIAL & NON-FINANCIAL PERFORMANCE

We are a leading Wholesale Banking franchise in ASEAN, catering to the Wholesale Banking contributed positively to the Group’s improved
banking needs of corporate and institutional clients. Our regional banking revenue and balance sheet during the year. Revenue increased by
solutions include capital market fund raising; corporate advisory services;
mergers and acquisitions (M&A); cash management; funding solutions
9.2% YoY, mainly due to improving market sentiment as well as
ranging from traditional trade and capital expenditure financing to solid loan and deposit growth. Wholesale Banking loans grew by
structured trade, value-chain, project, M&A and leverage financing; 7.2% YoY, whereas deposits were up by 4.5% YoY. The Financial
structured investment; risk management; fixed income; currency and Institutions Group (FIG) and Private Banking (PB) segments
commodities (FICC) and equity derivatives. Our products are distributed contributed to YoY revenue growth of 44% and 19% respectively.
across various customer segments – from retail and high net-worth Our Treasury & Markets’ revenue and profit before tax recorded
individuals to SMEs, Corporates and Financial Institutions.
impressive 23% and 49% growth rates YoY, respectively.
We are also one of the top brokers in the region through CGS-CIMB, our Wholesale Banking’s cost-to-income ratio also improved, mainly
joint-venture with China Galaxy Securities, where we have one of the most due to continued systematic cost saving efforts.
comprehensive research coverage of equities, fixed income and
economics, as well as our award-winning i-Trade online trading platform
that provides access to Asian and US markets. Our regional Private
Banking service offers customised advisory, portfolio planning and wealth Wholesale Banking Wholesale Banking
Loans Deposits
management solutions for high net-worth individuals.
(RM billion) Banking
Wholesale (RM billion) Banking
Wholesale
In line with the Group’s footprint, our key value proposition is our regional Loans Deposits
presence, platforms and solutions. Our cross-border regional operating Wholesale
(RM billion) Banking Wholesale
(RM billion) Banking
model (ROM) equips us with the capabilities to offer insights on regional Loans Deposits
markets and bespoke products with sustainable returns. In doing so, we also (RM billion) (RM billion)
deliver best-in-class and seamless customer experience across all markets.
111.1 111.1 111.1

119.1 119.1 119.1

150.2 150.2 150.2

157.0 157.0 157.0

2018 2019 2018 2019
OUR GROWTH DRIVERS IN 2019 7.2% YoY 4.5% YoY
The year 2019 started with uncertainty on the back of rising US-China trade 2018 2019 2018 2019
tensions, dragging regional and global economic growth. Policy rate cuts by 7.2%2019
Revenue
2018 YoY 4.5%
Profit
2018 Before YoY
Tax
2019
Central Banks in our key markets also impacted overall banking performance. (RM billion) (RM billion)
7.2% YoY
Revenue 4.5%
Profit Before YoY
Tax
We have yet again demonstrated resilience in a challenging business
environment. Our Treasury & Markets business registered commendable (RM billion) (RM billion)
Revenue Profit Before Tax
top and bottom line growth year-on-year. Our Corporate Banking, Private (RM billion) (RM billion)
Banking and Financial Institution segments also delivered healthy YoY
growth in revenue.
4.5

4.9

1.8

1.9

Alongside positive financial performance, we have taken tangible measures 2018 2019 2018 2019
to improve our EES (Economic, Environmental, Social) orientation and
4.5

4.9

1.8

1.9

9.2% YoY 5.1% YoY

performance in planning our financing activities. During the year, we started 2018 2019 2018 2019
4.5

4.9

1.8

1.9

working on Sustainability Linked Loans (SLLs), financing instruments where 9.2%2019

YoY 5.1%2019
YoY
2018 2018
corporate borrowers receive financing incentives upon achieving pre- Wholesale Banking Wholesale Banking
agreed sustainability performance targets. SLLs were officially launched in Loans 9.2% YoY 5.1% YoY
Deposits
January 2020. This is part of our commitment to help support our clients (RM billion) Banking
Wholesale (RM billion) Banking
Wholesale
manage their EES risks and future-proof their businesses. Loans DepositsThailand
Thailand
Wholesale
(RM billion)
10.0 Banking
Others Wholesale 6.8 Banking
(RM billion) Others
During the year, our focus has been to offer a seamless banking experience Loans 5.9 Deposits
Singapore 5.0
8.0 Thailand
to our customers. We strengthened our digital capabilities via collaboration (RM Thailand
billion) OthersMalaysia (RM billion)
6.8 Malaysia
Singapore 10.0 Indonesia Others
with technology partners in e-procurement to bring cost-effective e-supply 20.8 5.9 59.3 Singapore
14.6 Thailand 5.0
122.6
Thailand 8.0 6.8
chain financing solutions to the supplier community. The integrated OthersMalaysia Others
Singapore 10.0 5.9 59.3 Indonesia
Singapore
Malaysia
procure-to-pay and supply chain financing allow suppliers to access lower 20.8
Indonesia 14.6 8.0
5.0 122.6
cost of funds by leveraging on large corporate buyers’ good credit rating. 23.1
Singapore Malaysia Indonesia Malaysia
20.8 59.3 14.6 122.6
In October 2019, we completed our first structured trade financing using a Total
Indonesia 119.1 Total 157.0
23.1
blockchain platform and IoT cargo sensor technology for imports into
China. The platform provides secure real-time tracking of cargo in transit as Total
Indonesia
23.1
119.1 Total 157.0
well as in the warehouse using blockchain-based technology. This mitigates
Total 119.1 Total 157.0
fraud risk, with alerts to both lenders and customers on any unauthorised
movements of the financed cargo. The plan is to scale up the volume of this
blockchain-based financing in the next two to three years.

60
 AWARDS AWARDING BODY
AWARDS & Best Bond House in Southeast Asia Alpha Southeast Asia Best Deal & Solution Awards 2019
RECOGNITION Best Investment Bank (Malaysia) Euromoney Awards for Excellence Asia 2019
Corporate and Investment Bank of the Year (Indonesia) Asian Banking and Finance
– Corporate & Investment Banking Awards 2019
Best Investment Bank; Best Private Bank; Finance Asia Country Awards 2019
Best Equity House; Best DCM House (All for Malaysia)

H I G H L I G H T S 2 0 19

KEY INITIATIVES RESULTS

COST MANAGEMENT
Continued to drive cost-saving initiatives through process Continuous improvement in cost-to-income ratio from 49% in 2018 to 47%
improvement; a cost-conscious culture and mindset; and in 2019. JAW was positive at 5%.
leveraging our regional operating model.
CUSTOMER SOLUTIONS
Introduced seamless, secure, and cost-effective financial Completed first structured trade financing transaction using Blockchain
solutions to support customers’ growth through innovation and platform and announced collaboration with technology partners to provide
technology. e-supply chain financing solutions to the supplier community.
POSITIVE IMPACT FINANCING
Accelerated efforts to design and launch sustainable financing Launch of the first ever Formosa Sustainable Development Goals (SDG)
products and solutions, positively contributing to our EES Bond of USD680 million issued by a Malaysian and ASEAN issuer in the
agenda and performance. Reg-S international capital markets.
Launch of SLLs worth RM3 billion to incentivise corporate borrowers to
enhance their EES efforts.

C H A L L E N G E S & R I S K M I T I G AT I O N

CHALLENGES/RISKS MITIGATION STRATEGIES RESULTS

Escalating Trade Tensions: Leveraged on our Regional Operating Model Group corporate loans reported positive
Slower industry and loan growth, lower Net (ROM) and focused on growing loans and growth at 2.0% YoY, mainly contributed from
Interest Income (NII) from rate cuts in Malaysia, deposits. Malaysia, Indonesia and Thailand.
Indonesia and Thailand.

Higher Customer Expectations & Rising Disciplined costs across business units and Wholesale Banking achieved 9% YoY Revenue
Costs: geographies through systematic investments growth with healthy Cost-to-Income Ratio and
Expectations of customers for digitalisation – all towards offering personalised customer positive JAW of 5%.
and increased investments in technology solutions.
affecting operating costs.

Disruptive Industry: Collaborated with high-potential technology Completion of first trade financing with
Entry of non-traditional players, especially in companies to strengthen our value proposition blockchain technology for imports from New
the retail segment of Treasury products. (e.g. e-Supply Chain Financing Solutions). Zealand to China.

A NEW BEGINNING – FOCUS AREAS

Customer Centricity: Technology & Data: Sustainability: Our People:

• Initiatives to adopt a holistic • Accelerating revamp of • Introduced Sustainable • Conduct targeting training to
regional and integrated technology platforms to Financing for targeted enhance staff’s
Customer Relationship improve customer corporate customers. understanding of sustainable
Management (CRM) for all experience. • Collaborating with financing within the CIMB
Treasury products to offer • Digitalising customer development organisations framework.
customised solutions to our on-boarding and process on Green Financing. • Participation in CIMB’s 3D
customers swiftly and automation. Foundation and Intermediate
comprehensively. programmes.

OUTLOOK & PROSPECTS

As we have entered the second year of our In 2020, amongst other business • Leveraging our ROM to strengthen our
5-year strategy, our focus is on accelerating aspects, our focus will be on: position as the “Go To” bank for ASEAN
execution of our key strategies. Our priority • Growing our market share across Malaysia, businesses;
will be to continuously seek opportunities to Indonesia, Singapore and Thailand (MIST), • Furthering our China Strategy to support
drive sustainable growth and create value for mainly to offer competitive products and China-ASEAN trade flows and FDIs; and
our stakeholders. In doing so, we will remain pricing to our customers; • Building our sustainable financing portfolio
vigilant about downside risks of the current • Reinforcing our position as the preferred to maximise the bank’s positive impact to
economic environment. banker of our targeted corporate EES and focusing on maintaining good
customers; asset quality.
Our main efforts will be channelled towards • Extending our support and substantiating
proactive management of costs, systematic the Digital Transformation efforts of the
investments and continually improving the Government;
credit quality of our portfolios.
61
group “The Group Transaction Banking recorded a healthy 6% growth in
revenue as well as a double-digit client-base growth in 2019. Our

transaction efforts to diversify our income structure from NII to NOII towards
building a sustainable business gained momentum during the year,

banking despite interest cuts across the region. Our key differentiator has
been our ability to create value through our products and services,
by way of easing clients' pain points in managing their business and
financial operations. We will continue to fulfil the changing needs of
by Rafe Haneef our clients as the industry transitions into a digital economy.”

WHO WE ARE & WHAT WE DO OUR GROWTH DRIVERS IN 2019

We offer a wide range of products and services covering cash Transaction Banking recorded a positive revenue growth across
management, trade finance, supply chain financing solutions, Malaysia, Indonesia, Singapore, Thailand and Cambodia
online banking and securities services to cater to both our (MISTC) despite the challenging market environment.
corporate and institutional clients across the region. We provide
Our revenue in 2019 was well diversified, contributed by growth
comprehensive end-to-end cash management solutions
in all our products and services, which we continue to design to
designed to help our clients manage their payments and
address specific needs of our customers. Particularly, we have
collections effectively and maximise their liquidity potential. innovative solutions to solve the costly manual reconciliation
These services are also offered through our 24/7 online banking processes, tedious transaction matching, inaccuracies, and
platform to facilitate our clients’ business needs at their delayed reconciliation. Our solutions can help clients in driving
convenience. efficiency through improved reconciliation processes, saving
valuable time and resources.
Our trade finance products cover a comprehensive range
– from traditional trade products to structured trade and Deposits growth of 10%, propelled by the two largest
supply chain financing solutions - designed to cater to contributors, namely Malaysia and Singapore, were the primary
our clients’ diverse business needs in domestic and drivers for an increase in Net Interest Income (NII) of 5%.
Meanwhile, the Non-Interest Income (NOII) grew at 10%, mainly
international trade.
contributed by cash management and trade finance business.

We also provide end-to-end securities services solutions With rapid advancements in the digital space, our e-banking users
via fund accounting services, custody services, corporate continued to expand, with promising future growth in the segment.
trustee and agency services. Our key value proposition is As at end 2019, we registered a double-digit growth of 17% YoY in
our unique ability to fully facilitate transactions, supply chains the number of active e-banking clients across the region.
and trade flows across ASEAN and beyond. We are the
gateway to ASEAN, empowered by our strong networks, Our trade finance business also recorded a commendable
comprehensive digital platforms, best-in-class shariah growth in 2019, mainly attributed to various strategic
expertise as well as strategic alliances across the interventions. These include our strategy on ecosystem thinking
ecosystems that represent the economic potential of this and solutions as well as structured trade finance deals, which
recorded an encouraging growth of 13% YoY.
diverse region.

FINANCIAL PERFORMANCE
Total Revenue Deposits Trade Loans
In 2019, the Group Transaction Banking (RM billion) (%) Thailand (%)
Thailand
5%
continued to register a growth of 5% in revenue Cambodia
1%
9% Cambodia
2%
YoY across the region, with each of our core Singapore
Malaysia Malaysia
10% Singapore
businesses reporting healthy growth, mainly 63% 31% 38%

contributed by Malaysia and Singapore. Our Indonesia

21%
2.8

3.0

businesses in both Cambodia and Singapore

2018 2019 Indonesia
continued to be the two best performing 20%
countries in the region, with a double-digit 6% YoY 10% YoY 1% YoY
revenue growth YoY.

AWARDS & AWARDS AWARDING BODY

RECOGNITION
Best Cash Management Bank in Malaysia Alpha SEA Best Financial Institution Awards
Best Service Provider – Fintech Partner Malaysia Malaysia e-Payments Excellence Awards (MEEA)
TnG Wallet – Best Payments and Collections Solution Malaysia Triple A Asset Asian Awards

62
 H I G H L I G H T S 2 0 19

KEY INITIATIVES RESULTS

CURRENT ACCOUNT/SAVINGS ACCOUNT (CASA) FOCUS
Deployed targeted strategies and multiple campaigns in bigger Casa balances increased by 10% YoY.
markets such as Indonesia and Malaysia, mainly to grow our
deposit base. In smaller markets such as Thailand and Singapore,
we introduced competitive tiered-rates CASA, with fee privileges.
ECOSYSTEM PUSH
Introduced full-suite of bundled financing solutions, targeting entire Mandated deals with trade limit of RM630 million in the eco-system.
sectoral ecosystems to reach out to suppliers, distributors, dealers
and buyers amongst others. Account Receivables Discounting deal.
SEGMENT FOCUS
Targeted new segments and strategised to deepen the wallet Growth from targeted segments and SME sectors at 28% and 3%
share for the government and state-owned sectors Improving respectively.
SME penetration with better synergy between Branches,
Business Units and Transaction Banking.

C H A L L E N G E S & R I S K M I T I G AT I O N

CHALLENGES/RISKS MITIGATION STRATEGIES RESULTS

Fraud Transactions: Increasing online Strengthened our standard operating Launch of online fraud monitoring in
frauds/cybercrime due to low awareness in procedures (SOPs) on digital transactions Malaysia in 4Q2019, and in Singapore in
the marketplace. and raise awareness by collaborating with 1Q2020.
regulators and industry players to tackle the
problem as an industry.

Implemented more comprehensive

screenings for all the documents.

Market Volatility: Fluctuating and reduced Diversified the sources of our revenue by Increase in NOII by 10% YoY.
interest rates and the overall weak market tapping new areas with growth potential.
sentiments.

A NEW BEGINNING – FOCUS AREAS

Customer Centricity: Sustainability: Technology & Data:

• Responded to customer expectations • Mobile Banking, designed for simple • Initiating platform revamp exercise to
on financing through end-to-end and easy transactions for SMEs. enable an open platform to support
product solutioning. • In Malaysia alone, we have registered business scalability and more
• Rolled-out downstream and a total of 2,709 SME Mobile Banking importantly support external and
upstream financial solutions for users as at 31 December 2019, after partnership integrations. This will
players (in targeted sectors) 2 months of going live. propel us to enable digital
• Increased income in the first targeted transactions compared to the
sector by 300% as at 31 December traditional paper-based transactions.
2019. Investing into data infrastructure to
enable advisory services to clients
and business insights to monetise our
data.

OUTLOOK & PROSPECTS

We expect the volatility of the market to continue in 2020, with We will continue to invest to transform the Transaction Banking
more interest cuts in the region. However, our outlook remains business as the businesses are automating and digitalising their
positive and we see our business gaining momentum in the region. financial processes. This will help to improve performance, provide
To further gain competitiveness and market share, we will focus on greater digital banking capabilities, as well as improve customer
targeted areas of growth. For instance, we will focus on growing experience. In addition, we are driving swift changes in the way we
our trade business by developing ecosystem solutions as well as run our business as the usage of data and analytics expands in
supply chain solutions with our partners and customers. We also improving our products, processes and business insights.
plan to drive cross-border transactions by leveraging on our
regional operating model.

63
group “Initiated with the mandate of developing the Group’s new and
disruptive businesses and value creation streams, GVP was

ventures & successful in establishing baseline narratives across its practices

and achieved all key targets for the year. We kick-started a platform-

partnerships focused Partnerships infrastructure, our TNG-Ant Financial joint

venture grew significantly, and the Group’s first all-digital banking
franchise in the Philippines scaled rapidly in its first year of
operation. Overall, we recorded healthy momentum going into 2020
and have begun identifying key disruptive levers to accelerate over
by Effendy Shahul Hamid the next 5 years.”

TotalPERFORMANCE
FINANCIAL Registered Users Annual Active Users
WHO WE ARE & WHAT WE DO (million) (million)
Group Ventures & Partnerships (GVP) was established in Our asset management business performed commendably in
January 2019 as one of the Group’s multiple pillars towards 2019, having achieved 12.5% YoY growth in AUM, which closed
future-proofing the franchise. Our work revolves around the core at RM88.1 billion.
focus of how we tackle external disruptions facing our CIMB PH acquired at scale and ended 2019 with 1.7 million
businesses today, including areas of proliferating financial customers, exceeding expectations in its first year of operation.
services within ecosystems, new digital banking business

2.3

6.8

1.7

4.2
models, as well as financial technology. TNGD recorded
2018 exponential
2019 growth in user
2018 base,
2019tripling its total
registered users YoY to 6.8 million and more than doubling its
We operate a Partnerships infrastructure that focuses on Annual Active193% YoY rate to 4.2 million.
User (AAU) 145% YoY
creating new revenue streams through financial product
co-creation and distribution models with digital platform PAM AUM CIMB PH Total
companies, with the goal of ensuring CIMB remains at the (RM million) Customers Acquired
forefront of customer buying behaviours as well as value
creation in terms of platform economics.
We also operate a Ventures practice that sees the firm

1,685,455
78,321

88,139
selectively venture into platform-type businesses through equity
co-ownerships, to ensure we are able to participate in value } 28% new to
banking
creation opportunities in the future. In addition to core ventures 2018 2019 2019
such as Touch ‘n Go (TNG) and Touch ‘n Go Digital (TNGD), we 12.5% YoY
also continue to own a 40% stake in Principal Asset
Management (PAM) and Principal Islamic Asset Management
TNGD
(PIAM) along with a select equity portfolio of investments.
Through active portfolio optimisation and capital management, Total Registered Users Annual Active Users
our Investments practice ensures that the Group’s balance (million) (million)
sheet is deployed effectively across its equity investments.
Also within the ambit of GVP is the Group’s digital banking-led
operations in the Philippines and Vietnam. Both start-up
businesses, CIMB Bank Philippines (CIMB PH) is now
recognised as a leading digital banking franchise in ASEAN and
2.3

6.8

1.7

4.2

CIMB Bank Vietnam (CIMB VN) is undergoing transformation to 2018 2019 2018 2019
pivot towards a digital-first model. 193% YoY 145% YoY

PAM AUM CIMB PH Total

(RM million) Customers Acquired
OUR GROWTH DRIVERS IN 2019
On the Partnerships front, we have successfully deployed a TNG has to date fitted 900,000 RFIDs nationwide and is now in a
merchant micro-financing MVP (minimum viable product) with position to evolve beyond toll and transport payments. On the
three platforms – Lazada, Shopee and TNG e-Wallet, and will public markets front, despite a challenging year we recorded a PBT
1,685,455

continue iterating through 2020 and beyond. Over the course of of RM46 million on our 40% share of PAM’s performance. On the
78,321

88,139

the year, we achieved our targets in establishing an operating

28% new to
private markets portion, we closed off a profitable year }
on the back
banking
model, developing technological baselines and establishing of continued2018
optimisations
2019 and gains on our equity
2019 investments.
market-driven use cases.
CIMB PH grew12.5% YoY customers in its first year of operation,
to 1.7 million
The TNG e-Wallet saw tremendous growth in its user base and driven by a platform-centric operating model and a pure digital
closed 2019 as Malaysia’s top e-wallet, with 6.8 million registered infrastructure. Set up with the ability to co-create and deploy
users and 116,000 merchant partners. TNGD’s trajectory has financial products on digital ecosystems, we have successfully
been driven primarily by a strong acquisition engine, compelling proliferated a scalable acquisition regime and activated key
propositions and robust tech proliferation with Ant Financial. technology levers instrumental in the pursuit of a sustainable digital
banking model. CIMB VN in turn completed the first phase of
We also successfully completed a shareholding consolidation recalibration with plans afoot to enhance its digital focus in 2020.
exercise at TNG, with CIMB now owning 100% of the business.

AWARDS AWARDING BODY

AWARDS &
RECOGNITION Best Digital Bank (CIMB PH) The Asian Banker Philippine Awards 2019
Best Consumer Digital Bank (CIMB PH) Asia-Pacific Global Finance Awards 2019
Fastest Growing Digital Bank (CIMB PH) International Finance Banking Awards 2019
Best Asset Management House in ASEAN (PAM) Asia Asset Management 2019

64
 H I G H L I G H T S 2 0 19

KEY INITIATIVES RESULTS

Established Partnerships infrastructure & operating model • Team structure established and operationalised early-2019
• Key partnership engagements pursued, resulting in
deployment of merchant micro-financing MVP on three
platforms – Lazada, Shopee and TNG e-Wallet
Successfully leveraged TNG-Ant Financial JV and scaled e-wallet • Gained significant momentum and scaled rapidly in 2019
business • Acquired 6.8 million registered users, 116,000 merchant
partners
• Achieved AAU rate of 4.2 million
Initiated a fully digital, mobile-first franchise in the Philippines • Established key partnership elements critical to digital
operating model and distribution
• Acquired 1.7 million customers in first year of operation

C H A L L E N G E S & R I S K M I T I G AT I O N

CHALLENGES/RISKS MITIGATION STRATEGIES RESULTS

New and untested Partnerships regime Established multi-disciplined teams and Successfully engaged multiple platform
deployed an agile working structure with partners and rolled out MVP on three
focus on developing viable use cases with platforms
potential partners
Limitations in technology to proliferate Deployed an iterative development process First iteration of merchant micro-financing
required propositions with focus on establishing product product deployed, pipeline of partner-
foundations, with room for further revisions centric products and tech requirements
and improvements down the road established with developmental milestones
through 2020
Uncertainty with entry into new market in Initiated franchise with baseline partnership Launched CIMB PH anchored on
the Philippines operating model and a focused product partnership with GCash and began
suite acquiring at scale with a best-in-class
savings proposition

A NEW BEGINNING – FOCUS AREAS

Disruption Mitigation & Future- New Revenue Streams Alternate & Digital Banking Models
proofing • Through cohesive product • Regulatory changes and increasing
• Changes in consumer behaviours distribution and customer calls for financial innovation and
and the enablement of technology aggregation capabilities, platform inclusion are taking place in markets
have given rise to disruptive players companies and non-banks are across Asia and beyond, and are in
across various industries. GVP has gaining access to customers across turn reshaping the financial industry.
been designed to address this aspect the globe, and have also begun The emergence of fintech players and
by pursuing opportunities and originating financial services. As a digital banks are introducing new
orchestrating value creation outside banking franchise, it is critical to business models that challenge
the Group. Platform-collaborative
consider new modes of origination conventions in terms of how banks
efforts on the Partnerships front,
and acquisition beyond our can operate. Our digital franchises in
growing of strategic ventures such as
TNGD and acceleration of our digital established banking channels. GVP’s the Philippines and Vietnam have
banking businesses will ensure that mandate will be to pursue and begun materialising, and will form
the Group remains in the forefront of capture these opportunities as we catalysts for the Group in view of
disruptive practices, capabilities and evolve our ability to serve customers imminent digital banking policies.
technologies. in the next 5 years.

OUTLOOK & PROSPECTS

GVP has had a positive start in 2019, having established the right CIMB PH has proven its ability to scale well on its current business
momentum across various practices and achieved key targets model. 2020 will see the momentum continue, as well as
heading into 2020. In the year ahead, we aim to double down on enhancements to our tech stack and proliferation of digital lending
areas of building capabilities, driving new propositions, and propositions. We aim to see the beginning of data monetisation as
sharpening our focus on creating value whilst continuing to invest in we deepen our relationships with platform partners and sharpen
our businesses through their initiation stages. our execution. CIMB VN has established the required foundations
to grow a digital franchise, and we will begin to see the
We will continue to accelerate our Partnerships efforts, focusing on partnerships pipeline take off as we aim to start acquiring
delivering improved tech and product pipelines in addition to customers at scale in 2020.
market-driven commercial strategies as we look towards opening
up new revenue streams with more platform partners. On the digital banking front in Malaysia, progress in the central
bank’s policy and the anticipated issuance of licenses in 2020 are
TNGD’s growth continues to look promising, as we begin to realise interesting developments to observe. We expect to see the
synergies of our joint venture with Ant Financial in the retail introduction of new players and capabilities in the market. CIMB
e-payments space. We will continue to invest in the growth of this has begun diligence efforts in this space and will develop a view in
business in addition to pivoting its revenue strategies. At TNG due time.
Group, plans are also underway to pivot the company towards
being a transportation ecosystem anchored on RFID use cases.
65
group “Our initiative to develop the global Halal sector was cited in the 2019
State of the Global Islamic Economy Report as a contributor towards

islamic Malaysia ranking number one on the Global Islamic Economy Indicator
(GIEI) index. These efforts in 2019 move us towards establishing Islamic

banking and Halal trade financing leadership in some of the world’s largest capital
markets. In developing our Halal ecosystem, we have aligned with
institutions sharing the same vision, including a leading international bank
and various Halal-related bodies within the region. Our goal is to enable
by Ahmad Shahriman local SMEs to strengthen their Halal infrastructure and credentials
Mohd Shariff towards building their global competitiveness.”

WHO WE ARE & WHAT WE DO OUR GROWTH DRIVERS IN 2019

We are the Islamic banking and financial services franchise of Overall, regional Islamic financing, including asset under
the Group with an extensive suite of innovative Shariah- Restricted Agency Investment Account, registered financing
compliant products and services. Our solutions include growth of 10.8% YoY, closing the year at RM100 billion gross
financing, sukuk, investment banking, transaction banking, financing. The growth momentum for financing and deposits
banca-takaful and securities services for individual, commercial, continued to be supported by the Islamic First strategy, with
corporate and institutional customers across ASEAN. Islamic financing share of book growing close to 40%, mainly
contributed by the consumer and SME segments.
In conducting Islamic business, we monitor and ensure good
Shariah governance and compliance across the Group. With the The CIMB Halal Corridor strategy and the trade financing
execution of our Islamic First strategy, we aim to extend the challenges faced by SMEs, led us to develop our first-to-market
value proposition of Islamic products to our customers and the solution, HalalBizReady. This will equip the critical mass of
wider public. We aspire to provide world-class Islamic banking high-potential and export-ready SMEs with necessary financing
and finance solutions, which will progressively integrate to build a robust Halal infrastructure. In addition to providing
environmental, social and governance factors via a value-based working capital, with the help of our local and international
approach, a hallmark of Islamic finance. partnerships, we will facilitate access to global Halal networks
as well as internationally recognised standards and
certifications.

FINANCIAL & NON-FINANCIAL PERFORMANCE In response to the growing consumer demand, and backed by
our strong partners, Takaful Ikhlas and Berjaya Sompo, we
expanded our General Takaful protection solutions. During the
Deposits & Investment year, we introduced two new products – Islamic Motor and Fire
Financing Account Takaful – into our banca-takaful portfolio. In recognition of the
Group Islamic Banking Deposits & Investment
Group Islamic Banking
Financing Account increasing effects of Climate Change, takaful contribution (under
(RM billion)* (RM billion)
Group Islamic Banking Group Islamic Banking Fire Takaful) now offers customers an option to cover their
(RM billion)* (RM billion) property against losses from natural disasters such as floods in
addition to fire or lightning.

In 2019, trading and FX gain reported double-digit growth.

100.0100.0

103.1103.1
90.3 90.3

88.8 88.8

2018 2019 2018 2019 Islamic Structured Products also saw tremendous growth owing
to the relaunch of two products, namely Callable Islamic Range
10.8%
2018 YoY
2019 16.1%
2018 YoY
2019
Accruals and Commodity Range Bound transactions, further
10.8% YoY 16.1% YoY strengthening our Islamic wealth management proposition.
Profit Before Tax Profit Before Tax
Group Islamic Banking CIMB Islamic Bank Berhad
Profit Before Tax Profit Before Tax Regionally, CIMB Niaga Syariah in Indonesia reported
(RM billion) (RM billion)
Group Islamic Banking CIMB Islamic Bank Berhad accelerated growth and was ranked amongst the top 5 largest
(RM billion) (RM billion) Islamic banks in Indonesia in terms of asset size, as at FY2019
published figures. Its deposits and financing books have
registered significant growth YoY, at 41.9% and 28.8%
respectively. While in Singapore, we secured a financing deal for
1.3 1.3

1.6 1.6

1.0 1.0

1.1 1.1

2018 2019 2018 2019 a local trading company amounting to RM136 million – our
largest Islamic financing in Singapore for the year.
24.8%
2018 YoY
2019 7.8%2019
2018 YoY
24.8% YoY 7.8% YoY
* Includes Restricted Agency
Investment Account (RAIA)
* Includes Restricted Agency
Investment Account (RAIA)

66
 AWARDS & AWARDS AWARDING BODY
RECOGNITION
Best Islamic Finance Sukuk House Alpha SEA Regional Islamic Finance Award
Islamic Finance House of the Year FinanceAsia House Awards 2019
Best Islamic Bank (Malaysia) Islamic Finance News (IFN) Best Banks Poll 2019

H I G H L I G H T S 2 0 19

KEY INITIATIVES RESULTS

CIMB ISLAMIC & THE HALAL ECOSYSTEM
Supported by partnership with the Department of Islamic Earmarked RM100 million financing for SMEs to achieve Halal
Development in Malaysia or JAKIM, initiated efforts to champion status
new financing and growth opportunities for SMEs in the Halal
Development of HalalBizReady for SMEs with access to the
space.
expertise of CIMB’s halal-based strategic partnerships
HALAL TRADE FINANCING AND ISLAMIC BANKING
LEADERSHIP
Launched promotional initiatives and sponsorships for MIHAS 50% increase in brand awareness and our commitment to Halal
and SimplySiti, which is a popular Halal brand led by Malaysia’s industry development
most popular influencer – Siti Nurhaliza.
ISLAMIC FIRST CONSUMER BANKING PRODUCT
STRATEGY
Launched “Kempen Umrah Bersama CIMB Islamic”, focussing on Opened 24,019 new accounts, with RM63 million in incremental
growing Islamic CASA base and build strong association with balances as at June 2019
Umrah in the long term.

A NEW BEGINNING – FOCUS AREAS

Customer Centricity: Ventures & Partnerships: Sustainability:

• Activated a commercialisation plan • Established partnership with a key • Partnered with the International
and new-to-bank strategies, mainly international bank and secured Islamic Centre for Education in
focused on meeting the needs and membership to their Trade Club Islamic Finance (INCEIF) to undertake
expectations of customers in the Alliance to provide local SMEs access research on the Renewable Energy
Halal ecosystem as well as those to global Halal networks. (RE) and Energy Efficiency (EE)
seeking sustainable financing. • We will continue to identify key sectors, including regional
• Towards Forward23, we will aim to synergies and opportunities in the benchmarking and gap analysis for
expand our reach to address markets Islamic economy sectors to bring products and policies.
that are underserved and value-added services to our • Going forward, we are committed
underbanked. customers. towards developing sustainable
business financing solutions by
ramping up new SME business within
the green economy sectors, starting
with RE and EE.

OUTLOOK & PROSPECTS

According to the State of the Global Islamic We will continue to build on our the ‘green’ space. We will also focus on
Economy Report 2019/20, global Islamic Commercialisation Plan and strengthen our creating an enabling environment for
Finance assets are expected to reach position in the Halal marketplace by SMEs, who are the backbone of the
USD3.47 trillion by 2024. This translates to offering collective commitment of our local economy, by facilitating access to
a 5.5% CAGR over the span of 6 years and international partners to catalyse trade knowledge and sustainability practices.
from 2018. Group Islamic Banking is financing and capacity building and
committed to tap this potential by finding achieve new growth for SMEs in Halal. In 2020 and beyond, we will continue to
opportunities to create value and offer explore strategic partnerships, which will
differentiated solutions to our customers. Aligned with the Group’s focus on bring added-value and improve customer
Sustainability and managing the impact of experience within our identified high-
our business on the environment and priority customer segments across markets
society, we will remain committed to that are unique to Islamic.
developing products and solutions within

67
board of

BOARD
COMPOSITION
1 Senior Independent Director AGE GROUP 2

4
50 years & below

5 Independent Directors 51 years – 60 years

2 Non-Independent Directors 3 61 years – 70 years

68
 Seated from left to right • T E N G K U DATO ’ S R I Z A F R U L T E N G K U A B D U L A Z I Z
• DAT U K M O H D N A S I R A H M A D
• TEOH SU YIN

Standing from left to right • AFZ AL ABDUL RAHIM

• DATO ’ L E E KO K K WA N
• ROBERT NEIL COOMBE
• DATO ’ M O H A M E D R O S S M O H D D I N
• D I D I SYA F R U D D I N YA H YA
• A H M A D Z U LQ A R N A I N C H E O N

33.33% 33.33%
LENGTH OF 0 year – 2 years 5 years & above GENDER NATIONALITY
TENURE
8 Male 7 Malaysians
1 Female 2 Non-Malaysians
33.33%
2 years – 5 years

69
board of

DATUK MOHD NASIR AHMAD TENGKU DATO’ SRI ZAFRUL

Chairperson/Independent Director TENGKU ABDUL AZIZ
Group Chief Executive Officer/
Executive Director

Nationality | Malaysian Nationality | Malaysian

Age | 65 Age | 46
Gender | Male Gender | Male

Date of Appointment | 
Date of Appointment |
20 July 2015 27 February 2015
BR GN
AC CC RC Length of Tenure | 4 Years Length of Tenure | 5 Years

Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Fellow, Associate of Chartered Certified Accountants (ACCA), United • Fellow, Asian Institute of Chartered Bankers
Kingdom • Master of Arts in Finance and Management, University of Exeter,
• Chartered Accountant, Malaysian Institute of Accountants (MIA),
Malaysia United Kingdom
• Masters in Business Administration (Finance), Universiti Kebangsaan • Investment Management Certificate, Institute of Investment
Malaysia, Malaysia Management and Research, United Kingdom
• Bachelor of Science (Hons) in Economics and Accounting, University
AREAS OF EXPERTISE
• Accounting and Audit, Operations, Human Resource, Strategy of Bristol, United Kingdom
Development and Implementation
AREAS OF EXPERTISE
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S • Accounting and Audit, Banking and Finance, Legal, Risk Management,
Listed Entities
• Nil Capital Market, Consumer Marketing, Human Resource, Corporate
Public Companies Leadership, Strategy Development and Implementation, Innovation
• Independent Director of CIMB Bank Berhad and Transformation, Learning and Development
• Chairperson/Independent Director of CIMB Bank (Cambodia) PLC
• Independent Director of SIRIM Berhad D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Listed Entities
R E L E VA N T E X P E R I E N C E
Datuk Mohd Nasir Ahmad was appointed as Chairperson/Independent • President Commissioner of PT Bank CIMB Niaga Tbk
Director of CIMB Group Holdings Berhad on 20 October 2018. He was Public Companies
the President of MIA from August 2011 to July 2013. In September 2013 • Chief Executive Officer/Executive Director of CIMB Bank Berhad
he was elected as a Council Member of the ACCA UK and re-elected in
September 2016 and November 2019.
R E L E VA N T E X P E R I E N C E
He brings with him vast experience in the areas of leadership,
With over 23 years of experience in the financial services sector,
management, finance and accounting which spans over 40 years,
having started his career as a Trainee Accountant with Tenaga Nasional specialising in Investment Banking and change management, Zafrul’s last
Berhad (TNB) in 1979 and moving on to hold various positions in the position was with Maybank Investment Bank Berhad and Maybank Kim
Finance Division. Eng Holdings as Chief Executive Officer. He also held senior positions in
In January 1993, Datuk Mohd Nasir was seconded to TNB’s subsidiary Citigroup Malaysia, Kenanga Holdings Berhad and Avenue Securities. He
company, Malaysia Transformer Manufacturing Sdn Bhd as the also experienced being an entrepreneur by setting up Tune Money Sdn
Financial Controller before being appointed as Chief Executive Officer Bhd, Asia’s first “no-frills” online financial service provider.
(CEO) in June 1994.
Zafrul is currently a member of the APEC Business Advisory Council
In January 2000, he joined Sharikat Permodalan Kebangsaan Berhad
as its CEO. On 1 June 2001, he was appointed CEO of Perbadanan (ABAC), representing Malaysia in promoting intra-trade and collaboration
Usahawan Nasional Berhad, a position he held until his retirement on within Asia Pacific. Further, as an advocate of Malaysia’s socioeconomic
1 June 2011. development, he currently sits on the Board of the National Sports
Datuk Mohd Nasir also holds directorships in private companies namely Council of Malaysia, in addition to being a Trustee of the Perdana
Prokhas Sdn Bhd and CIMB EOP Management Sdn Bhd and is a Leadership Foundation. He is also an Honorary Commander of the Navy
Trustee of Yayasan Canselor UNITEN. Volunteer Reserve under the Royal Malaysian Navy.

B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E
BOD AC BRCC GNRC BOD AC BRCC GNRC
Chairperson Member Member Member Member
16/16 16/17 7/7 15/16 16/16 – – –
Declaration Declaration
• He does not have any conflict of interest or any family relationship with any • He does not have any conflict of interest or any family relationship with any
other Director and/or major shareholders of the Company other Director and/or major shareholders of the Company
• He has not been convicted for any offences within the past five (5) years nor • He has not been convicted for any offences within the past five (5) years nor
has he been imposed of any public sanction or penalty by any relevant has he been imposed of any public sanction or penalty by any relevant
regulatory bodies in 2019 regulatory bodies in 2019

70
 TEOH SU YIN ROBERT NEIL COOMBE
Senior Independent Director Independent Director,
Sustainability Sponsor

Nationality | Malaysian Nationality | Australian

Age | 48 Age | 56
Gender | Female Gender | Male

Date of Appointment | 
Date of Appointment |
8 October 2014 16 April 2014
GN BR BR GN
RC AC CC Length of Tenure | 5 Years CC RC Length of Tenure | 5 Years

Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Bachelor of Arts (Hons) Business Studies, Sheffield Hallam University, • Bachelor of Laws (Hons), University of Technology, Sydney, Australia
United Kingdom
• Business and Technology Education (BTEC) Higher National Diploma AREAS OF EXPERTISE
(HND) Business Studies, Sheffield Hallam University, United Kingdom • Accounting and Audit, Banking and Finance, Operations, Consumer
• Diploma, Chartered Institute of Marketing, United Kingdom
Marketing, Human Resource
• Licensed Investment Adviser by Securities Commission of Malaysia
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
AREAS OF EXPERTISE
Listed Entities
• Banking and Finance
• Executive Chairperson of Generation Development Group, Australia
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S Public Companies
Listed Entities • Nil
• Nil
R E L E VA N T E X P E R I E N C E
Public Companies
• Nil Robert Neil Coombe is currently the Executive Chairperson of the ASX
listed Generation Development Group, a financial services business
R E L E VA N T E X P E R I E N C E focused on generational financial solutions. He is also Chairperson of
Teoh Su Yin was re-designated as Senior Independent Director of CIMB Craveable Brands, the largest Australian owned Quick Service
Group Holdings Berhad on 20 October 2018. She has almost 20 years’ Restaurant business. He was the CEO of Craveable Brands between
experience in equity research and investments. 2013 and April 2017.

Su Yin began her career with JP Morgan Malaysia as a Junior Analyst in Before joining Craveable Brands, Robert was responsible for all of
1994. In 2000, she became Head of Research with sector coverage Westpac’s Retail, Business and Agri banking operations throughout
experience in infrastructure, plantations, power, gaming, real estate and Australia. Prior to this role, Robert spent six years as the CEO of BT
conglomerates. Financial Group, responsible for all of Westpac’s funds management,
In 2002, she left JP Morgan to join Deutsche Bank Malaysia Berhad, financial planning, insurance, private banking, broking, platform and
initially as a Senior Analyst and later as Managing Director, Head of superannuation businesses in Australia.
Malaysia and ASEAN Equity Research. As individual analyst, Su Yin
was ranked Top 3 by Asiamoney in 2008 and 2009. In total, he has over 35 years’ corporate experience in both Australia
and Asia.
She currently serves on the Board of Albizia ASEAN Opportunities Fund
in Singapore, the Board of World Wildlife Fund-Malaysia, as a member In addition to the above, Robert is a Director of Tibra Capital, Surfing
of the Alice Smith School Finance Sub-Committee and holds Australia and the Australian Indigenous Education Foundation. He is
directorships in various other private companies. also a member of the Advisory Board of 5V Capital Investors.

B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E
BOD AC BRCC GNRC BOD AC BRCC GNRC
Member Member Member Chairperson Member Chairperson Member
16/16 13/17 7/7 14/16 15/16 – 6/7 13/14
Declaration Declaration
• She does not have any conflict of interest or any family relationship with any • He does not have any conflict of interest or any family relationship with any
other Director and/or major shareholders of the Company other Director and/or major shareholders of the Company
• She has not been convicted for any offences within the past five (5) years nor • He has not been convicted for any offences within the past five (5) years nor
has he been imposed of any public sanction or penalty by any relevant has he been imposed of any public sanction or penalty by any relevant
regulatory bodies in 2019 regulatory bodies in 2019

71
board of directors profile

DATO’ MOHAMED ROSS DATO’ LEE KOK KWAN

MOHD DIN Non-Independent Director
Independent Director

Nationality | Malaysian Nationality | Malaysian

Age | 67 Age | 54
Gender | Male Gender | Male

Date of Appointment | 
Date of Appointment |
19 April 2016 20 July 2015
BR GN BR
AC CC RC Length of Tenure | 3 Years CC Length of Tenure | 4 Years

Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Banking Diploma (Part 1), Institute of Bankers, United Kingdom • Masters in Business Administration, Simon Fraser University, Canada
• Bachelor of Business Administration (First Class), Simon Fraser
AREAS OF EXPERTISE University, Canada
• Banking and Finance, Operations, International Experience
AREAS OF EXPERTISE
• Banking and Finance
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Listed Entities D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
• Nil Listed Entities
Public Companies • Nil
• Chairperson/Independent Director of CIMB Islamic Bank Berhad Public Companies
• Non-Independent Director of CIMB Bank Berhad
R E L E VA N T E X P E R I E N C E • Non-Executive Director of Cagamas Holdings Berhad
Joined HSBC Bank Malaysia Berhad (HSBC) in early 1972 and served
R E L E VA N T E X P E R I E N C E
in various capacities ranging from Corporate and Retail Banking and
Dato’ Lee Kok Kwan was the Deputy Chief Executive Officer (CEO) of
Branch Management. He also served as Head of Treasury Malaysia and
CIMB Group prior to his Board appointments. His areas of
Head of Group Audit Malaysia between 1987 and 1996. During this
responsibilities included Corporate Banking, Transaction Banking and
period he also worked for a year in Hong Kong, London and New York Sales and Trading businesses in interest rates, credit, foreign exchange,
in areas of Foreign Exchange and Treasury. As the Managing Director bonds, equity, commodities and their derivatives, treasury and funding
(2003), he was responsible for HSBC’s Islamic onshore business for the Group, fixed income investments and debt capital markets which
franchise in Malaysia until he retired on 31 December 2007. he developed since joining CIMB in 1996, and has since grown the
businesses to be one of the largest global markets operations in
Upon retirement, Dato’ Mohamed Ross was appointed as an Executive ASEAN.
Director and Senior Advisor of HSBC Amanah Takaful Malaysia Sdn
Bhd until December 2008. At the same time and until April 2016, he Prior to joining CIMB in 1996, Dato’ Lee had more than seven years of
was also an Independent Director of HSBC Amanah Malaysia Berhad, markets and treasury experience in the Canadian banking industry. He
was the Treasury Portfolio Manager responsible for interest rates and
where he sat as Chairperson of the Risk Committee and was a member
optionality risk and return for a leading Canadian bank and a member of
of the Audit Committee and Nomination Committee.
its Senior Asset-Liability Management Committee.
Dato’ Mohamed Ross currently sits on an Advisory Board overseeing a Dato’ Lee is also a member of the Board of Trustees of the Capital
Private Equity Fund (Ekuinas OFM Programme) as an Independent Markets Development Fund (CMDF) and Adviser to the Securities
Member. Additionally he also sits as a Trustee on the Board of Lembaga Commission Malaysia. He was appointed as First Director and
Zakat Selangor and also serves as an Independent Director on the Chairperson of the Bond and Sukuk Information Platform Sdn Bhd with
Board of an Asset Management company. effect from 3 November 2017 and 22 November 2017, respectively. He
also holds directorships in various other private companies.

B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E
BOD AC BRCC GNRC BOD AC BRCC GNRC
Member Chairperson Member Member Member Member
16/16 17/17 7/7 16/16 15/16 – 7/7 –
Declaration Declaration
• He does not have any conflict of interest or any family relationship with any • He does not have any conflict of interest or any family relationship with any
other Director and/or major shareholders of the Company other Director and/or major shareholders of the Company
• He has not been convicted for any offences within the past five (5) years nor • He has not been convicted for any offences within the past five (5) years nor
has he been imposed of any public sanction or penalty by any relevant has he been imposed of any public sanction or penalty by any relevant
regulatory bodies in 2019 regulatory bodies in 2019

72
 AHMAD ZULQARNAIN CHE ON AFZAL ABDUL RAHIM
Non-Independent Director Independent Director

Nationality | Malaysian Nationality | Malaysian

Age | 47 Age | 42
Gender | Male Gender | Male

Date of Appointment | 
Date of Appointment |
3 November 2017 31 January 2019
BR GN
CC RC Length of Tenure | 2 Years Length of Tenure | 1 Year

Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Bachelor of Arts in Economics from Harvard and Radcliffe College, • Bachelor in Mechanical Engineering with Electronics, University of
Harvard University, USA Sussex at Brighton, United Kingdom

AREAS OF EXPERTISE AREAS OF EXPERTISE

• Banking and Finance, Capital Market, Corporate Leadership, • Legal, Operations, Information Technology, Human Resource,
Strategy Development and Implementation Strategy Development and Implementation, Innovation and
Transformation
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Listed Entities D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
• Nil Listed Entities
Public Companies • Chief Executive Officer of TimedotCom Berhad
• Non-Independent Director of Malaysia Airlines Berhad • Non-Independent Director of Symphony Communication Public
• Non-Independent Director of Malaysia Aviation Group Berhad Company Limited
Public Companies
R E L E VA N T E X P E R I E N C E • Nil
Ahmad Zulqarnain Che On is Deputy Managing Director of Khazanah
Nasional Berhad. He joined Khazanah in May 2014 as an Executive R E L E VA N T E X P E R I E N C E
Director, Investments and subsequently appointed as Head, Strategic Afzal Abdul Rahim is a technology entrepreneur who currently serves
Management Unit of Khazanah. as Commander-In-Chief of TIME dotCom Berhad, an ASEAN based
telecomunications operator encompassing Fixed Line, Data Centres
Prior to Khazanah, he was appointed as the first Managing Director/
and Global Submarine Cable Systems. He joined TIME in 2008 after
Chief Executive Officer of Danajamin Nasional Berhad in 2009. He has
establishing The AIMS Asia Group and Global Transit International in
over 22 years’ experience in both banking and corporates, including
2006.
tenures with UBS Warburg, Pengurusan Danaharta Berhad, CIMB
Group and Symphony Group. Afzal founded the non-profit Malaysian Internet Exchange (MyIX) in
2006 and also serves as a Board Member of Endeavor Malaysia, an
organisation that is devoted to nurturing high-impact entrepreneurs. He
is also a Member of the Civil Aviation Authority Malaysia.

He began his career in the automotive sector, initially as a Chassis

Development Engineer and thereafter managing clients on the
engineering consultancy side of the business at Group Lotus PLC. Afzal
is also a Licensed Commercial Pilot.

B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E
BOD AC BRCC GNRC BOD AC BRCC GNRC
Member Member Member Member Member
15/16 – 6/7 15/16 15/16 – – 7/9
Declaration Declaration
• He does not have any conflict of interest or any family relationship with any • He does not have any conflict of interest or any family relationship with any
other Director and/or major shareholders of the Company other Director and/or major shareholders of the Company
• He has not been convicted for any offences within the past five (5) years nor • He has not been convicted for any offences within the past five (5) years nor
has he been imposed of any public sanction or penalty by any relevant has he been imposed of any public sanction or penalty by any relevant
regulatory bodies in 2019 regulatory bodies in 2019

73
 group company
board of directors profile

DIDI SYAFRUDDIN YAHYA DATIN ROSSAYA MOHD NASHIR

Independent Director Group Company Secretary

Nationality | Indonesian Nationality | Malaysian

Age | 52 Age | 51
Gender | Male Gender | Female

Date of Appointment | 
Date of Appointment | 2002
7 May 2019
Length of Tenure | 18 Years
GN
RC Length of Tenure | Less than 1 Year

Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Fellow Chartered Accountant, Institute of Chartered Accountants in • Bachelor of Laws (majoring in Business Law), Coventry University,
England and Wales, United Kingdom United Kingdom
• Master of Arts, University of Cambridge, United Kingdom • Licensed Secretary, Companies Commission of Malaysia
• Affiliate, Malaysian Institute of Chartered Secretaries and
• Bachelor of Arts, University of Cambridge, United Kingdom
Administrators

AREAS OF EXPERTISE AREAS OF EXPERTISE

• Capital Market, International Experience • Company Law, Corporate Secretarial Practice, Corporate
Governance and Conflicts Management
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Listed Entities D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
• Nil Listed Entities
• Nil
Public Companies
• Independent Director of CIMB Investment Bank Berhad Public Companies
• Nil
• Commissioner of PT Bank CIMB Niaga Tbk

R E L E VA N T E X P E R I E N C E
R E L E VA N T E X P E R I E N C E
Datin Rossaya Mohd Nashir has worked at the bank since joining the
Didi Syafruddin previously worked for J.P. Morgan for more than 20 Corporate Legal Services Unit in 2002. She was instrumental in setting
years based in Indonesia and subsequently Malaysia where he was the up the Company Secretarial Department in 2004 and was appointed as
Managing Director and Head of Investment Banking. At J.P. Morgan, Group Company Secretary in 2006.
Didi Syafruddin advised clients on mergers and acquisitions, equity and
In her role, she is responsible for providing counsel and advice on
debt capital markets transactions and had been involved in a number of
Board duties and responsibilities, to ensure that CIMB complies with
landmark deals in both Indonesia and Malaysia. He is currently a relevant laws and regulatory requirements. She also plays a liaison role
Member of Investment Panel of Urusharta Jamaah Sdn Bhd. between the Board and its key stakeholders both in Malaysia and in the
Group’s regional operations, ensuring that a corporate governance
framework is deployed in a manner that supports the Group’s vision
and aspirations.
She has extensive industry knowledge, with over 25 years of experience
in corporate secretarial practice. Previously, she was with Permodalan
Nasional Berhad where she assumed the position of Joint Company
Secretary for several of its subsidiaries. She began her career with the
Time Engineering Group.
Datin Rossaya serves as a member of the Companies Commission of
Malaysia’s Corporate Practice Consultative Forum and is a Director of
several subsidiaries in the CIMB group. She is a CIMB Sustainability
B OA R D A N D B OA R D C O M M I T T E E AT T E N DA N C E
Champion and has initiated several projects to encourage sustainability
BOD AC BRCC GNRC in the workplace for #teamcimb. She actively advocates greater
Member Member participation of women in the boardroom and has been involved in
12/12 – – 6/7 various networking initiatives to promote this agenda.
Declaration Declaration
• He does not have any conflict of interest or any family relationship with any • She does not have any conflict of interest or any family relationship with any
other Director and/or major shareholders of the Company other Director and/or major shareholders of the Company
• He has not been convicted for any offences within the past five (5) years nor • She has not been convicted for any offences within the past five (5) years nor
has he been imposed of any public sanction or penalty by any relevant has she been imposed of any public sanction or penalty by any relevant
regulatory bodies in 2019 regulatory bodies in 2018

74
 corporate

100% OTHER SUBSIDIARIES

iCIMB (MSC) SDN. BHD.

81.23%
TOUCH ‘N GO SDN. BHD.

51%
TNG DIGITAL SDN. BHD.

100%
CIMB GROUP SDN. BHD.

99.99% 100%
CIMB BANK BHD. CIMB INVESTMENT BANK BHD.

100% OTHER SUBSIDIARIES

CIMB ISLAMIC BANK BHD.
100%
CIMB BANK (L) LTD.
100% 100%
iCIMB (MALAYSIA) SDN. BHD. CIMB SI SDN. BHD.

94.83%
CIMB THAI BANK PUBLIC COMPANY LTD. 100%
CIMB SI 1 SDN. BHD.
100%
CIMB BANK (CAMBODIA) PLC 18.77%
100% TOUCH ‘N GO SDN. BHD.
CIMB BANK (VIETNAM) LIMITED

OTHER SUBSIDIARIES
60%
CIMB BANCOM CAPITAL CORPORATION

92.5% 50%
PT BANK CIMB NIAGA TBK CGS-CIMB SECURITIES INTERNATIONAL PTE. LTD.

OTHER SUBSIDIARIES OTHER SUBSIDIARIES

75
board of

CIMB BANK BERHAD

CHAIRPERSON MEMBERS
Dato’ Zainal Abidin Putih Tengku Dato’ Sri Zafrul Venkatachalam Sukanta Kumar Dutt
Non-Independent Director Tengku Abdul Aziz Krishnakumar Independent Director
Chief Executive Officer/ Independent Director (Appointed on 30 October 2019)
Executive Director
Dato’ Lee Kok Kwan Nadzirah Abd Rashid
Datuk Mohd Nasir Ahmad Non-Independent Director Independent Director
Independent Director (Appointed on 30 October 2019)
Serena Tan Mei Shwen
Rosnah Dato’ Non-Independent Director Dato’ Sri Amrin Awaluddin
Kamarulzaman Independent Director
Independent Director Chu Hong Keong (Resigned on 1 May 2019)
Independent Director
Datin Grace Yeoh Cheng (Appointed on 1 May 2019)
Geok S E C R E TA RY
Independent Director Datin Rossaya Mohd Nashir

CIMB INVESTMENT BANK BERHAD

CHAIRPERSON MEMBERS
Dato’ Robert Cheim Jefferi Mahmud Hashim Nadzirah Abd Rashid Didi Syafruddin Yahya
Dau Meng Chief Executive Officer/ Independent Director Independent Director
Non-Independent Director Executive Director
Manu Bhaskaran S E C R E TA RY
Independent Director
Datin Rossaya Mohd Nashir

CIMB ISLAMIC BANK BERHAD

CHAIRPERSON MEMBERS
Dato’ Mohamed Ross Ahmad Shahriman Mohd Ahmed Baqar Rehman Rafe Haneef
Mohd Din Shariff Independent Director Chief Executive Officer/
Independent Director Chief Executive Officer/ Executive Director
Executive Director Ho Yuet Mee (Resigned on 1 October 2019)
(Appointed on 1 October 2019) Independent Director

Rosnah Dato’ Kamarul Jalalullail Othman S E C R E TA RY

Zaman Independent Director Datin Rossaya Mohd Nashir
Independent Director

PT BANK CIMB NIAGA TBK

MEMBERS
Glenn Muhammad Surya Zulkifli M. Ali Didi Syafruddin Yahya
PRESIDENT
Yusuf Independent Commissioner Non-Independent Commissioner
COMMISSIONER
Vice President Commissioner (Appointed 15 April 2019)
Tengku Dato’ Sri Zafrul (Resigned on 1 September Pri Notowidigdo
Tengku Abdul Aziz 2019) Independent Commissioner Sri Widowati
President Commissioner Independent Commissioner
Jeffrey Kairupan David Richard Thomas (Appointed 15 April 2019)
Senior Independent Non-Independent Commissioner
Commissioner CORPORATE SECRETARY
Fransiska Oei

76
 CIMB THAI BANK PUBLIC COMPANY LIMITED

CHAIRPERSON MEMBERS

Dato’ Robert Cheim Dau Adisorn Sermchaiwong Dr. Rom Hiranpruk Title Job :
Natasak Rodjanapiches
CIMB Thai, Thai logo refinement Client : CIMB Investment Bank Berhad
Date : 12 February 2009
Designer : Urasa Navanugraha

Meng President and Chief Executive Independent Director Independent Director

Non-Independent Director Officer/Executive Director (Appointed on 18 April 2019)
(Appointed on 4 December Omar Siddiq Amin Noer
2019) Rashid Oranuch Apisaksirikul
Non-Independent Director Independent Director
Watanan Petersik (Appointed 26 June 2019)
Independent Director Shahnaz Farouque Jammal
Ahmad
S E C R E TA RY
Serena Tan Mei Shwen Non-Independent Director
Non-Independent Director Patima Jumpasut
Niti Jungnitnirundr
Chanmanu
CIMB Cambodia Sumawong Independent Director
Option 1 - Normal
Independent Version
Director (Appointed on 18 April 2019)

Positive - Colour & Greyscale

C0 M100 Y85 K60

C I M B B A N K ( C A M BC0OM100
D IY100
A )K0 P L C

K100

CHAIRPERSON M E M BK50
ERS Yong Jiunn Run
Non-Independent Director
Datuk Mohd Nasir Ahmad Bun Yin Ahmad Shazli
(Resigned on 16 December
Independent Director Chief Executive Officer/ Kamarulzaman Reversed - Colour & Greyscale
2019)
(Appointed on 16 December Executive Director Non-Independent Director
2019) C0 M100 Y85 K60 (Appointed on 16 December
Dato’ Wira Zainal Abidin
Dr. Mey Kalyan 2019)
C0 M100 Y100 K0
Mahamad Zain
Independent
K100 Director
Independent Director
K50 Dato’ Shahrul Nazri Abdul
(Retired on 16 December 2019)
Aisyah Lam Abdullah Rahim
Independent Director Non-Independent Director
(Resigned on 1 July 2019) J O I N T S E C R E TA R I E S
Omar Siddiq Amin Noer
Ly Sophea
Rashid Renzo Christopher Viegas
Non-Independent Director Non-Independent Director Datin Rossaya Mohd Nashir
(Appointed on 16 December (Resigned on 31 July 2019)
2019)

CIMB BANK (VIETNAM) LIMITED

CHAIRPERSON MEMBERS
Dato’ Wira Zainal Abidin Thomson Fam Siew Kat Aisyah Lam Abdullah Renzo Christopher Viegas
Mahamad Zain Chief Executive Officer/ Independent Director Non-Independent Director
Chairperson/ Executive Director (Resigned 31 July 2019)
Independent Director Effendy Shahul Hamid
Le Le Thuy Non-Independent Director
J O I N T S E C R E TA R I E S
Independent Director (Appointed on 6 December
2019) Tran Hai Long
Datin Rossaya Mohd Nashir

77
group shariah

From left to right

• ASSOCIATE PROFESSOR DR AISHATH MUNEEZA

• DR YOUSEF ABDULLAH AL SHUBAILY
• AHMED BAQAR REHMAN
• DR SHAFAAI MUSA
• DR NEDHAM YAQOOBI
• DR AHMAD SUFIAN CHE ABDULLAH

78
 group shariah

DR SHAFAAI MUSA DR NEDHAM YAQOOBI

Nationality | Malaysian Nationality | Bahraini

Age | 53 Age | 61
Gender | Male Gender | Male

Date of Appointment | 9 January 2006 
Date of Appointment | 14 June 2006
Length of Tenure | 13 Years Length of Tenure | 13 Years

Q UA L I F I CAT I O N Q UA L I F I CAT I O N
• PhD, Glasgow Caledonian University, UK • PhD in Islamic Law, University of Wales, UK
• Master’s degree in Comparative Laws, IIUM • [Link]. in Finance, McGill University, Montreal, Canada
• Degree in Shariah, Al-Azhar University, Egypt • Bachelor of Arts degree in Economics and Comparative
Religion from McGill University, Montreal, Canada
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
• Chairman of the Shariah Committee at Sun Life Malaysia D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Takaful Berhad • Member of Shariah Board of AAOIFI
• Member of Shariah Board of IIFM (Islamic International Finance
R E L E VA N T E X P E R I E N C E Market)
• Former Associate Professor at the Ahmad Ibrahim Kulliyyah of • Over 40 Shariah Advisory Boards including Standard
Laws at the International Islamic University Malaysia (IIUM) Chartered, BNP Paribas, Abu Dhabi Islamic Bank, S&P,
• Former Chief Executive Officer of the Johor Institute of Integrity, Dow Jones, and Lloyds Bank
Leadership and Training
R E L E VA N T E X P E R I E N C E
• Former Executive Director of IIUM’s Centre for Continuing
• Author of Several Articles and Publications on Islamic Finance
Education
and other Sciences, in both English and Arabic
• Former Chief Executive Officer of the International Islamic
• Educated in classical Shariah in his native Bahrain and in Mecca
College cum Chief Executive Officer, International Islamic
under the guidance of eminent scholars such as Sheikh Abdulla
University Malaysia Higher Education Sdn Bhd
Al-Farisi, Sheikh Yusuf Al-Siddiqi, Sheikh Muhammed Saleh
al-Abbasi, Sheikh Muhamed Yasin Al-Fadani of Mecca, Sheikh
Habib-Ur-Rahman A. Zaini of India, Sheikh Abdulla bin Al-Siddiq
Al-Ghumar of Morocco

79
group shariah committee profile

AHMED BAQAR REHMAN DR YOUSEF ABDULLAH

AL SHUBAILY

Nationality | Pakistan Nationality | Saudi Arabian

Age | 61 Age | 49
Gender | Male Gender | Male

Date of Appointment | 1 June 2019 
Date of Appointment | 28 October 2008
Length of Tenure | 2 Years Length of Tenure | 11 Years

Q UA L I F I CAT I O N Q UA L I F I CAT I O N
• Bachelor of Arts-Economics – University of Michigan, USA • PhD in Islamic Jurisprudence from Imam Muhammad ibn Saud
Islamic University
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S • Master’s degree from the Department of Comparative
• Member, Independent Board of Director, CIMB Islamic Bank Jurisprudence at Imam Muhammad ibn Saud Islamic University
Berhad • Bachelor’s degree from Faculty of Shariah and Fundamentals of
• Chairman, Board Risk Committee, CIMB Group Islam, Department of Comparative Jurisprudence at Imam
• Member, Independent Board of Director, Al Baraka Bank Muhammad ibn Saud Islamic University
(Pakistan) Limited
• Chairman, Board Risk Committee, Al Baraka Bank (Pakistan) D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Limited
• Member of Shariah Board of AAOIFI
• Managing Partner, Israa Capital
• Member of Shariah Board of IIFM (Islamic International Finance
R E L E VA N T E X P E R I E N C E Market)
• Mr. Ahmed Rehman has over 30 years of experience with • Member of Shariah Board of Albilad Bank in Saudi Arabia
multinational banks in senior management roles, such as Chief
Executive as well as direct responsibility for wholesale bank and R E L E VA N T E X P E R I E N C E
risk. He was also involved in the Corporate Banking integration • Currently lectures in the Department of Comparative
of Standard Chartered Bank Pakistan with Grindlays Bank Jurisprudence, High Institute of Judiciary at Saudi Arabia’s
Pakistan Imam Muhammad ibn Saud Islamic University in Riyadh
• His experience covers different geographies in Asia, Middle • Serves as a Cooperating Professor for the American Open
East and Africa, with American Express Bank, Standard University
Chartered Bank and Al Rajhi Bank • Performs advisory functions within numerous religious and
• Former CEO of Al Rajhi Bank Malaysia charitable organisations both within and outside Saudi Arabia
• Written many books, academic papers and articles on Islamic
jurisprudence and commercial law
• Participated in numerous seminars and conventions in related
areas
• Expert of Islamic Fiqh Academy

80
 ASSOCIATE PROFESSOR DR AHMAD SUFIAN CHE ABDULLAH
DR AISHATH MUNEEZA

Nationality | Maldivian Nationality | Malaysian

Age | 35 Age | 41
Gender | Female Gender | Male

Date of Appointment | 13 April 2018 
Date of Appointment | 1 November 2019
Length of Tenure | 2 Years Length of Tenure | 1 Year

Q UA L I F I CAT I O N Q UA L I F I CAT I O N
• PhD in Law – International Islamic University Malaysia • PhD in Islamic Economy and Banking – University of Yarmouk,
Jordan
• LLM (Banking) – International Islamic University Malaysia
• Master’s Degree in Shariah (Islamic Finance) – University of
• Bachelor of Laws (Hons) – International Islamic University Malaya, Malaysia
Malaysia • Bachelor Degree in Shariah and Management – University of
Malaya, Malaysia
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
• Chairman, Shariah Advisory Council of Capital Market D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S
Development Authority, Maldives • Member, Shariah Advisory Board, Syarikat Takaful Malaysia
Keluarga Berhad
R E L E VA N T E X P E R I E N C E • Member, Fatwa Committee, Jabatan Mufti Negeri Perlis
• Former Deputy Minister – Ministry of Finance and Treasury, • Member, Islamic Legal Consultative Committee, Federal Territories
Republic of Maldives • Member, Waqaf Committee, Majlis Agama Islam dan Adat
Istiadat Negeri Kelantan (MAIK)
• Former Deputy Minister – Ministry of Islamic Affairs, Republic of • Member, Shariah Advisor Committee, Sabnuha Jewellery PLT
Maldives
• Former Chairman, Board of Directors, Maldives Center for R E L E VA N T E X P E R I E N C E
Islamic Finance Ltd • Currently a Senior Lecturer at the Department of Shariah and
Management, Academy of Islamic Studies of University Malaya.
• Former Chairman, Board of Directors, Maldives Hajj Corporation
• Previously Shariah Committee, Kenanga Investment Bank
Ltd (Tabung Haji of Maldives)
Berhad
• Previously Muamalat Expert Panel of Jabatan Kemajuan Islam
Malaysia (JAKIM)
• He has produced numerous publications such as book and
research papers in Islamic legal theories (usul fiqh), Islamic
commercial laws, Islamic banking and finance, Takaful and
Shariah Fintech
• He is the founder and administrator of “[Link]”, a social
media platform that strives to become a medium of education in
enhancing public awareness with regards to Islamic Finance
and Takaful since 2013

81
group

Seated front row from left to right • TIGOR M. SIAHA AN

• DATO ’ H A M I DA H N A Z I A D I N
• T E N G K U DATO ’ S R I Z A F R U L T E N G K U A B D U L A Z I Z

82
Back row from left to right • R AFE HANEEF
• DAV I D R I C H A R D T H O M A S
• GURDIP SINGH SIDHU
• E F F E N DY S H A H U L H A M I D
• S A M I R G U P TA
• OMAR SIDDIQ AMIN NOER RASHID
• ADISORN SERMCHAIWONG
• V I C TO R L E E M E N G T E C K
• K WA N K E E N Y E W
• SHAHNA Z JAMMAL
• AHMAD SHAHRIMAN MOHD SHARIFF

83
group management

TIGOR M. SIAHAAN VICTOR LEE MENG TECK ADISORN SERMCHAIWONG

Country Head, Singapore
Country Head, Indonesia Chief Executive Officer, CIMB Bank Singapore Country Head, Thailand
President Director & Chief Executive Officer, Chief Executive Officer, President & Chief Executive Officer,
PT Bank CIMB Niaga Tbk Group Commercial Banking CIMB Thai Bank PCL

Indonesian 48 Male Singaporean 49 Male Thai 53 Male

Q UA L I F I C AT I O N Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Double major in Finance and Accounting, • Bachelor of Applied Science (Materials • Master of Business Administration, Sasin
University of Virginia, Charlottesville, USA Engineering), Nanyang Technological Graduate Institute of Business
University, Singapore Administration of Chulalongkorn University
D I R E C T O R S H I P/ • Alumni of ASIAN Financial Leaders • Bachelor of Engineering, Chulalongkorn
R E L E VA N T A P P O I N T M E N T S Programme (AFLP), mandated by Monetary University
Authority of Singapore
• Chairman of Indonesia Malaysia Bilateral
Committee of Indonesian Chamber of D I R E C T O R S H I P/
D I R E C T O R S H I P/
Commerce and Industry (KADIN) R E L E VA N T A P P O I N T M E N T S
R E L E VA N T A P P O I N T M E N T S
• Vice Chairman of Perbanas (Indonesian • Nil • Chairman, CT COLL Co., Ltd.
Banks Association)
• Member of the Board of Trustees of R E L E VA N T E X P E R I E N C E R E L E VA N T E X P E R I E N C E
Jakarta International School (JIS) • 25 years of banking and finance career in
• Responsible for the Group’s Commercial
• Mentor in Endeavor Indonesia the areas of asset/investment
Banking business, comprising Business
• Executive Committee of Young Presidents Banking and SME Banking businesses, management, wealth management,
Organization (YPO) Indonesia across Malaysia, Indonesia, Singapore, channels and retail banking
• The Employers’ Association of Indonesia Thailand, Cambodia • He joined CIMB Thai in 2012 as Senior
(APINDO), Chairperson of Banking, • Responsible for the Group’s Singapore Executive Vice President, Head, Consumer
Financial Services & Taxation business, covering Consumer, Commercial, Banking and was subsequently appointed
• Vice Chairman of Indonesia Banker Corporate banking segments, including its President and CEO in Oct. 2019. During his
Institute Investment Banking, Private Banking and tenure as Head of Consumer Banking, he
Treasury units has successfully transformed a loss
R E L E VA N T E X P E R I E N C E • Over 20 years of experience in Microfinance,
making franchise to become the largest
Retail banking, Commercial Banking,
• Chief Country Officer of Citi Indonesia from revenue contributor to CIMB Thai. He has
Corporate Banking, Channels/ Distribution
2011-2015. First Indonesian to be also set up the pioneering Agile team
Management, Credit management, ALM,
appointed to the post with markets coverage in ASEAN, North within Group tasked to build a digital
• Held several key positions in Citi Indonesia Asia, Africa and Middle East challenger bank at CIMB Thai
including Country Head for Institutional • At Fullerton Financial Holdings, he was • In 2010, he joined UOB Bank PCL as
Clients Group, Head of Corporate & responsible for managing its investments in Executive Director, Country Head of
Investment Banking and Country Risk banks and financial services firms, driving Channels
Manager strategy and implementations, leading • In 2008, he joined Siam Commercial Bank
• Served as Vice President in Institutional several digital initiatives across Asia and PCL as Executive Vice President, Saving &
Remedial Management Group in Citi Head delivering strong operational risk Investment Products
Office in New York from 2000 to 2003 governance and performance excellence. • He spent about 5 years as President at
He held various board directorships within SCB Asset Management Co., Ltd.
the Fullerton Group
• In the Banking circuit, he was Managing
Director at United Overseas Bank (UOB)
and led the SME banking segment across
ASEAN. At Standard Chartered, he was a
member of the Global SME Banking
management committee, and worked and
lived in Singapore, Taiwan and China,
managing these business. He also led
several mergers and rationalisations for the
bank. Earlier in Citibank, he was the
Director for CitiBusiness
• Awarded “Top 50 Most Promising Young
Leaders’’ award in 2008 by The Asian
Banker for bankers aged below 40 in Asia
Pacific and Middle East region

84
AHMAD SHAHRIMAN MOHD SHARIFF SHAHNAZ JAMMAL SAMIR GUPTA
Chief Executive Officer, Group Islamic Banking Chief Executive Officer, Chief Executive Officer,
Chief Executive Officer/Executive Director, Group Wholesale Banking Group Consumer Banking
CIMB Islamic Bank Berhad

Malaysian 43 Male Malaysian 45 Male Singaporean 57 Male

Q UA L I F I C AT I O N Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Bachelor of Arts in Accounting and Finance, • Bachelor (Double First Class) and Master of • Bachelor of Technology in Mechanical
Lancaster University, United Kingdom Arts in Economics, University of Engineering, Indian Institute of Technology,
• Malaysian Financial Markets Certificate, Cambridge, United Kingdom India
Persatuan Pasaran Kewangan Malaysia
• MPhil in Economics, University of Oxford, • Master of Management Studies, University
dan Institut Bank-Bank Malaysia, Malaysia
• Chartered Profesional in Islamic Finance, United Kingdom of Bombay, India
Chartered Institute of Islamic Finance
Professionals, Malaysia D I R E C T O R S H I P/ D I R E C T O R S H I P/
R E L E VA N T A P P O I N T M E N T S R E L E VA N T A P P O I N T M E N T S
D I R E C T O R S H I P/ • Director, CIMB Thai Bank Public Company • Nil
R E L E VA N T A P P O I N T M E N T S
Limited
• Vice President and Council Member, • Director, CGS-CIMB Securities International R E L E VA N T E X P E R I E N C E
Association of Islamic Banking and Pte Ltd
Financial Institutions Malaysia (AIBIM) • Over 30 years’ experience in the banking
• Member, Standing Committee on Islamic industry including retail, wealth
Financial Reporting, Malaysian Accounting R E L E VA N T E X P E R I E N C E management, consumer finance, cards,
Standards Board (MASB) • Group Wholesale Banking (GWB) division risk, operations and audit
consists of Group Investment Banking, • Senior Manager with track record of
R E L E VA N T E X P E R I E N C E Senior Bankers’ Group, Group Private building consumer banking franchises in
• Over two decades of experience in the Banking, Group Corporate Banking, Asia, Africa and Middle East
corporate sector, of which 16 years were in Financial Institution Group, Group Treasury • Started his working career with Citibank,
Islamic Banking and Finance-related roles & Markets, Group Analytics & Strategy and India and moved to Singapore in 1990
and has been a key contributor in the International Branches • Managed various roles in Citibank and
development of the Islamic banking and
• Was recently the Group Chief Financial Barclays and PT Bank CIMB Niaga Tbk
finance industry, with primary focus on
capital markets and treasury solutions Officer of CIMB Group based out of Singapore, Thailand, Dubai,
• Headed Wholesale Banking at HSBC • Prior to this, was in various capacities Turkey and Indonesia
Amanah Malaysia Berhad as Director, and within CIMB Group, including Deputy • Joined CIMB Group as Consumer Banking
prior to that he served as Head of Islamic Group Chief Financial Officer and Head of Director of PT Bank CIMB Niaga Tbk in
Banking at Citibank Berhad. In these roles, Capital & Balance Sheet Management, as 2010
he was tasked with building the Islamic well as in Group Risk Management,
Wholesale Banking and Treasury Corporate Client Solutions and PT Bank
businesses globally, in which he gained CIMB Niaga Tbk
strong leadership, technical, legal and risk
• Has over 20 years of banking experience,
management expertise from his stint in
these cross-border institutions covering M&A Advisory, Risk Advisory,
• Played an active role in the development of Trading and Risk Management
Malaysia’s Islamic banking industry, with a • Has worked with Goldman Sachs in
longstanding role in the Treasury committee London, Bankers Trust and Dresdner
of the Association of Islamic Banks in Kleinwort Wasserstein in London, as well
Malaysia (AIBIM). In this capacity he was as ABN AMRO Bank in Kuala Lumpur
involved in key industry initiatives such as
developing, amongst others, a commodity
exchange for Islamic finance purposes,
Islamic structured products, documentation
standards for Islamic derivatives as well as
Islamic credit support mechanism
• Prior to joining the banking industry via
Citibank’s Management Associate
programme, he was in the oil & gas industry
for four years while serving his scholarship
bond with a Malaysian conglomerate

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group management profile

RAFE HANEEF EFFENDY SHAHUL HAMID GURDIP SINGH SIDHU

Chief Executive Officer, Chief Executive Officer, Group Chief Strategy & Design Officer
Group Transaction Banking Group Ventures & Partnerships

Malaysian 49 Male Malaysian 46 Male Malaysian 46 Male

Q UA L I F I C AT I O N Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Master of Laws (LL.M), Harvard Law School • Honours in Electronic Engineering with
Optoelectronics, University College London, • Honours in Accounting and Finance, the
• Bachelor of Laws (LL.B), International United Kingdom London School of Economics and Political
Islamic University Malaysia • Digital Business Leadership Programme, Science, University of London, United
• Qualified for the New York State Bar in 1997 Columbia Business School, Columbia University Kingdom
• Admitted to the Malaysian Bar in 1995 • Alumni of the CIMB INSEAD Leadership • Chartered Financial Analyst (CFA)
Programme • Alumni of the CIMB-INSEAD Leadership
D I R E C T O R S H I P/
R E L E VA N T A P P O I N T M E N T S Programme
D I R E C T O R S H I P/
• Nil R E L E VA N T A P P O I N T M E N T S
• Director, Touch ’n Go Sdn Bhd D I R E C T O R S H I P/
R E L E VA N T E X P E R I E N C E • Director, TNG Digital Sdn Bhd R E L E VA N T A P P O I N T M E N T S
• Director, Financial Park (Labuan) Sdn Bhd • Director, Proton Commerce Berhad
• Oversees transaction banking business • Director, Principal Asset Management Berhad,
which consist of four main product pillars • Director, CIMB (Private) Limited, Sri Lanka
PT Principal Asset Management, Principal Asset
namely Trade Finance, Cash Management, Management Co Limited and Principal Islamic
Securities Services and Financial Institution Asset Management Sdn Bhd R E L E VA N T E X P E R I E N C E
serving the Group’s Non Retail customers
• Oversees the following functions;
across CIMB franchise in ASEAN. R E L E VA N T E X P E R I E N C E
Transaction Banking drives annuity business Corporate Strategy & Planning, Group
• Responsible for the development of the Group’s
and relationship stickiness; thus pivotal to the new and disruptive revenue and value creation Corporate Finance, Strategic Programme
growth of CIMB Group streams through a focus on creating and Management, Group Sustainability, Group
• Previously, CEO of CIMB Islamic Bank cultivating platform partnerships at scale, Customer Experience, Transforming
Berhad in charge of the Group’s Islamic venturing through selective strategic Customer Journeys, and Group Brand
banking and finance franchise. CIMB investments in platform based businesses, Management & Sponsorships
Islamic operates as a parallel franchise to steering CIMB’s approach and practices in • Works alongside the Group CEO and
the Group’s conventional operations and terms of financial technology trends, and Senior Management in setting the strategic
covers Islamic wholesale banking, Islamic managing the Group’s operations in Vietnam direction of the Group, supporting the
consumer banking, Islamic commercial and the Philippines. Responsible for leading
efforts and pursuing strategies in the virtual execution of transformational and growth
banking and Islamic asset management
and investments banking space for the Group initiatives and a member of the T18
• Instrumental in the inclusion of CIMB Islamic • Also responsible for the Group’s asset Oversight Committee and Forward23
in the Value-based Intermediation (VBI) management and investments business across Transformation Council. Gurdip also is a
Community of Practitioners, working to both public and private markets, including the member of the Group Executive
develop VBI together with the central bank to Group’s regional asset management business, Committee (GEXCO) as well as the Group
contextualise and drive sustainability with its private equity fund management business Management Committee (GMC)
Islamic finance institutions in Malaysia and the Group’s equity investments portfolio in
companies such as Principal Asset • Instrumental in CIMB Group being a
• Instrumental in CIMB Group being a founding member to the UNEP FI
member of RFI as well as a founding Management and Touch ’n Go
• Most recently, was CEO of Group Commercial Principles for Responsible Banking as well
member to the UNEP FI Principles for as responsible for the Strategic oversight
Banking, managing the Group’s regional banking
Responsible Banking businesses for the small and medium enterprise on Sustainability and Sustainable Finance
• 20 years of experience covering a range of and mid-sized corporate segment, with a key lean
businesses and functional roles gained • Prior to the expanded role that covers
on creating differentiated propositions and areas of Customer, Sustainability and
from three global banks, an international executing long term growth strategies
asset management company and a legal Brand, Gurdip was the Chief Strategy
• Prior to that, was Group Chief Marketing and
firm, at various financial centres including Communications Officer, managing the Group’s Officer where his focus was to drive the
London, Dubai and Kuala Lumpur entire marketing and communications initiatives organic and in- organic strategy and the
• CEO, Malaysia, and Managing Director of and lead franchise-wide efforts to ensure a execution of key initiatives. This included
Global Markets, ASP, HSBC Amanah in consistent and differentiated CIMB brand for all of the entry into new markets, key M&A and
2010 the Group’s Businesses across the region partnerships as well as the execution of the
• Regional Head for Islamic banking, Asia • Before that, served as a Director in the Group’s T18 Program
Pacific, Citigroup Asia in 2006 Investment Banking Division, primarily focusing • Prior to joining CIMB, Gurdip spent a
• Global Head of Islamic Finance business at on corporate advisory and origination
ABN AMRO Dubai in 2004 covering both • Prior to joining the Group, career stints in several decade in an international management
consumer and corporate businesses international companies in a corporate consulting firm advising banks,
• Joined HSBC Investment Bank plc, development capacity, mostly involved in private telecommunications companies and
London in 1999 and thereafter HSBC equity, merger and acquisition activities across Governments across ASEAN, India, South
Financial Services Middle East, Dubai Asia Pacific and general business expansion Korea and Spain
where he set up the global sukuk business initiatives.
in 2001. • Regional business experience having worked and
lived in Malaysia, Hong Kong and Singapore.

86
 KHAIRULANWAR RIFAIE OMAR SIDDIQ AMIN NOER RASHID DATO’ HAMIDAH NAZIADIN
Group Chief Financial Officer Group Chief Operating Officer Group Chief People Officer
Chief Executive Officer, CIMB Foundation

Malaysian 39 Male Malaysian 46 Male Malaysian 56 Female

Q UA L I F I C AT I O N Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• First Class Honours degree in Accounting • BSc (Hons) Economics, London School of • Bachelor of Laws, University of
and Finance from University of Warwick Economics Wolverhampton, United Kingdom
• MSc in Finance from Imperial College • Fellow, Institute of Chartered Accountants
• Member of the Institute of Chartered in England and Wales D I R E C T O R S H I P/
Accountants in England and Wales • CFA Charterholder R E L E VA N T A P P O I N T M E N T S
(ICAEW) • Director, Maxis Berhad
D I R E C T O R S H I P/
D I R E C T O R S H I P/ R E L E VA N T A P P O I N T M E N T S R E L E VA N T E X P E R I E N C E
R E L E VA N T A P P O I N T M E N T S • Director of CIMB Thai Bank Public • Provides overall strategic leadership for HR
• Director of SIBB Berhad Company Limited of CIMB across ASEAN
• Director of Perdana Nominees Sdn Bhd • Director of CIMB Bank (Cambodia) PLC • Transformed HR from an administrative
• Director of S.B Properties Sdn Bhd function into a key business enabler,
• Director of S.B. Venture Capital R E L E VA N T E X P E R I E N C E contributing to the Group’s rapid growth
Corporation Sdn Bhd • Appointed as the Acting President/CEO, into a leading ASEAN financial institution
• Director of Premier Fidelity Sdn Bhd CIMB Thai Bank Public Company Limited • Strategised the resource integration,
• Director of SBB Berhad • Previously was Head of Group Wholesale ensuring a successful consolidation in
• Director of Commerce Returns Berhad Banking at RHB Group with oversight over various mergers and acquisitions over the
• Director of CIMB Berhad the RHB Group’s Wholesale business years, within Malaysia, and across ASEAN
• Director of CIMB Southeast Asia Research (comprising investment banking, treasury, and APAC regions
Sdn Bhd (CARI) corporate banking and asset management) • Implemented strategic HR programmes,
• Director of CIMB Real Estate Sdn Bhd and its International business segment which have earned peer and industry
• Director of CIMB Group Sdn Bhd excluding Singapore (comprising recognition through numerous awards and
• Director of CIMB Bank (L) Limited Cambodia, Laos, Thailand and Brunei) elevated CIMB’s differentiation in the
• Director of Southeast Asia Special Asset • Former Executive Director and Group Chief market
Vehice Ltd (SEASAV) Financial Officer at Malaysia Airlines Berhad • Strengthened workplace culture through
• Director of CIMB Holidngs Sdn Bhd with responsibility primarily for financial numerous employee engagement initiatives
management spanning transaction with emphasis on the three critical
R E L E VA N T E X P E R I E N C E accounting, management reporting, behaviours of ‘A Better CIMB’ and
• Prior to his current role, Khairul held the budgeting, treasury, financial forecasting compliance to code of ethics and conduct
position of CFO, Malaysia and Regional and procurement as well as overseeing • Initiated the development of workplace
Head, Financial Control with responsibility aircraft fleet planning and management wellness policies and programmes to build
for tax, regulatory reporting, financial • Former Executive Director in the and sustain a productive and inspiring
accounting, management reporting, Investments Division at Khazanah Nasional environment
business finance advisory, product control Berhad and member of the senior • Leads people strategies to attract, develop
and financial planning management team with a focus on the and retain talent, cultivate an agile
• Khairul started his career with KPMG, aviation and airports sectors workforce to prepare for the future of work,
London focusing on servicing Investment • Former Managing Director in the and improve the end-to-end employee
Banking clients Investment Banking Division at CIMB experience via technology innovation
• In 2006, he joined Goldman Sachs, Investment Bank Berhad • Spearheads CSR in community
London as an equity analyst covering the • Former Executive Director in the Corporate development, sports and education
European Insurance Sector. He then joined Finance Practice of initiatives with diversity and inclusion as the
UBS, Malaysia in 2009 to cover the PricewaterhouseCoopers (PwC) guiding principles
Malaysian Banking Sector and later on also
covered the Singapore Banking sector
• Prior to joining CIMB Group, Khairul was
working at RHB Group, Malaysia as the
Head of Finance of RHB Islamic and Head
of Investor Relations

87
group management profile

DAVID RICHARD THOMAS KWAN KEEN YEW AMRAN MOHAMAD

Group Chief Risk Officer Group Chief Legal & Compliance Officer Group Chief Internal Auditor

American 60 Male Malaysian 46 Male Malaysian 44 Male

Q UA L I F I C AT I O N Q UA L I F I C AT I O N Q UA L I F I C AT I O N
• Bachelor’s Degree, Whitman College, • Bachelor of Laws (Hons), University of • Bachelor of Science (Hons) in Accountancy
Washington USA Sheffield, United Kingdom from the University of East Anglia, Norwich,
United Kingdom
D I R E C T O R S H I P/ D I R E C T O R S H I P/ • Fellow member of the Association of
R E L E VA N T A P P O I N T M E N T S R E L E VA N T A P P O I N T M E N T S Chartered Certified Accountants (ACCA)
• Commissioner, PT Bank CIMB Niaga Tbk • Nil • Member of the Malaysian Institute of
Accountants (MIA)
R E L E VA N T E X P E R I E N C E R E L E VA N T E X P E R I E N C E • Member of Institute of Internal Auditors
Malaysia (IIA)
• Oversees the risk management function of • Oversees the Group Legal and Compliance
CIMB Group, including Market, Non- function which is responsible for the
D I R E C T O R S H I P/
Financial Risk, Shariah, Asset Liability management of regulatory, legal and
R E L E VA N T A P P O I N T M E N T S
Management, Credit Risk Infrastructure compliance risks across CIMB Group
and Risk Analytics • Held various roles in a foreign bank which • Nil
• Responsible for ensuring the consistent included Regional Head of Compliance for
implementation of the Group’s risk Malaysia, Australia, Brunei, and Vietnam, R E L E VA N T E X P E R I E N C E
management policies and frameworks, Head of Wholesale Banking Compliance • Ensures that the Group Corporate
including operationalising the Risk Appetite for Hong Kong, and Head of Legal & Assurance Division supports the CIMB
Statement. The Risk Division of CIMB Compliance for Malaysia Group Audit Committee, CIMB Banking
Group identifies, assesses, measures, • Prior to joining the banking industry, Keen Group Audit Committee and other relevant
controls and reports the material risks that Yew was in private practice at a regional Audit Committees of Group’s subsidiaries
may impact the Group’s business law firm and was advising clients on in discharging their responsibilities, as well
operations, profitability, capital and projects, as well as banking and finance as managing their respective governance,
reputation risk and control functions. He oversees the
• Previously worked for Bank of America in Internal Audit functions across the entire
Los Angeles, California as a sector Banker, Group
covering the Fortune 500 Aerospace & • Amran has over 20 years of audit
Defense sector experience in the areas of capital market,
• Served as the Chief Risk Officer for Asia corporate and retail banking gained
Pacific for the Royal Bank of Scotland working in Malaysia and the United
(RBS). Prior to RBS, he served as the Chief Kindgom. Amran’s last held position before
Credit Officer for Asia Pacific for Bank of joining CIMB was Senior Vice President,
America Internal Audit with Royal Bank of Scotland
• Held various senior level positions based in in London. He had also previously worked
Singapore, Hong Kong, Thailand and with PwC, KPMG, UniCredit Bank and
Taiwan throughout his 26-year tenure in Barclays Capital
Asia

88
 human

People form one of the pivots of the Forward23 strategy. We recognise that people and their talent are the
machinery behind all growth. The dynamism of business today requires our people to be equipped with
special skills that will prepare them to manage the present and emerging risks of business. This means
building the skills of tomorrow and offering horizontal and vertical career and education paths. Also, talent
mobility (both physical and virtual) increases access to skills and new opportunities for growth, which in
turn improves employee morale and helps retain talent that are deemed critical for the organisation.

At CIMB, our approach is to boost the skills of both our current and future workforce. The idea is to future-proof our people as well as our
business. We believe that effective and efficient mechanisms to manage talent acquisition, growth and retention can ensure business
continuity, productivity, performance and competitiveness.

P R O M O T E D # T E A M C I M B A N D C I M B VA L U E S

We see culture-building in CIMB as an ongoing journey and this journey started in 2015 with the introduction of the A Better CIMB (ABC)
anchored on 3 Critical Behaviours:

Recognise each
Go the extra mile Respect each other,
other’s efforts and
to delight the engage openly and
always back
customers work together
each other up

To deepen our employees’ understanding of the 3 Critical Behaviours and embed them into the fabric of our employees’ daily
lives at work, we conducted a 3 Critical Behaviours bite-sized campaign, which included the following steps:

• Breaking down the three behaviours to six

• Agreeing on and defining the meaning behind each behaviour
• Explaining them to employees consistently via multiple online and offline channels including via the network of ABC Change Agents
made up of 135 Business Sponsors (BSPs) and 1,750 Informal Leaders (ILs) from across the region
• Conducting 61 engagement activities in Malaysia to better acquaint employees and recognise those who demonstrated the behaviours
• Showcasing role models nominated by their peers for demonstrating the behaviours

Cross-functional campaigns were also conducted for some of the behaviours which was the case with Customer Experience to further
strengthen understanding.

In 2019, we initiated the next phase of culture-building with a refresh of our values. We see our shared values as a positive
force that shapes the culture of #TeamCIMB, informing the way we work with our various stakeholders to achieve a shared
purpose. It creates a sense of belonging and affiliation, instils pride and helps in decision-making.

89
human capital development

OUR VALUES The refresh was timely and in tandem with the shift in societal values from ‘competition-
driven businesses’ to ‘purpose-driven networked organisations and people’. We saw a
need for increased and meaningful connections as well as more appetite for building
partnerships and co-creation.

CUSTOMER OBSESSED Against this backdrop, we conceived C.H.I.D.A for a Group-wide roll-out in 2020.

We are here for our customers, to Our purpose of ‘Advancing Customers and Society’ rests on our corporate values,
ensure they’re happy and satisfied. which define our culture and motivate action towards building #TeamCIMB, A
Better CIMB. We continue to highlight success stories, especially those with the
most active ABC networks.

Consumer Credit Operations (CCO)

HIGH PERFORMANCE We noted zero failed audits for this department that has more than 3,000 people across
the region. CCO worked to make the 3 Critical Behaviours a way of life, with regular formal
We always strive to go above and and informal engagements as well as a recognition programme to reward those who
beyond in everything we do. demonstrated the critical behaviours.

Group Operations

Following a restructuring exercise, Group Operations turned into a standalone function to

consolidate all operational activities across the Group. One major change was the
INTEGRITY centralisation of the reconciliation team which had 50 employees. In 2019, they were tasked
to drive the centralisation of the reconciliation process across Group Operations and
We’re always honest, responsible and reduce manual activities. The work was complex and the challenges included team
accountable in everything we do. Be members who were used to different leadership styles.
vigilant, be alert, be thorough.
The management prioritised ‘bridging trust’ issues, helping team members adjust to new
working styles. The leaders engaged openly with their team members, encouraged a
culture of transparency, engaged continuously, and set aside time for fun team activities
and coaching. Employees were also given opportunities to upskill/reskill via job rotations

DIVERSITY AND INCLUSION and training.

We believe everyone has something to By end 2019, the team saw a 47% reduction in outstanding reconciliation items,
contribute, regardless of race, gender implemented SOPs and have now embarked on building an automated
or opinions. reconciliation process.

AGILITY
We must respond quickly to change
and be problem solvers.

90
AC C E L E R AT E D E F F O R T S T O C R E AT E A N D S T R E N G T H E N O U R D I G I TA L S K I L L S

The banking sector is undergoing continuous transformation. Digitalisation of the workforce is becoming more of a cross-sector industry
norm. At CIMB, we are focusing our efforts on diversifying our talent sourcing channels. We believe that efficient and effective
implementation of CIMB’s strategic and sustainability roadmaps will depend on the quality of our talent and how they are increasingly adept
in meeting the future needs of the organisation. Our two-pronged approach is as follows:

Launching specific programmes that are designed to build digital skill set, with an objective of orientating and
recruiting high-potential technology talent from universities as well as industry players. These initiatives are also our
opportunities to position CIMB as the preferred tech talent employer.

Initiative 2019 Progress

The Digital • A highly-structured internship programme that combines classroom learning with job
Apprenticeship rotations and learning outcomes jointly pre-defined between partner institutions and CIMB.
Programme • Apprentices are offered positions in CIMB’s graduate programme upon successful
completion.
• In the spirit of social inclusion by providing pathways into careers in the digital economy,
the institutions identified for the pilot programme were mainly polytechnics and public
universities whose students are largely from families that are in the B40 and lower M40
APPRENTICESHIP PROGRAMME categories.
• Conducted outreach and engagement activities with two polytechnics and two
universities and enlisted 18 talents for the pilot programme.

Initiative 2019 Progress

The Complete Banker

• Targeted at grooming tech and digital talent, this newly-established graduate programme
(TCB) Digital
ensures that CIMB has the necessary talent with the right skills to thrive in the new digital
economy in the long-term. In the immediate to medium-term, the programme contributes

TCB
to the objectives of one of our Forward23 strategic pivots – People.
• The programme combines classroom training and job rotations, aimed at equipping
graduates with industry-specific knowledge and experience in developing solutions for
banking and financial services, with mentoring from senior digital talent within the firm.
• Recruitment started for the pioneer group, in preparation to launch to the wider public and
universities in the following year. The target is to have a total of 40 participants for 2020.

Enhance the digital quotient of all CIMBians across various levels and functions. In the mid-term, we aim to build an
agile, innovative and tech-savvy workforce, which will meaningfully contribute to digital transformation of the Group.

Initiative 2019 Progress

The CIMB 3D (Digital, • Established to enhance the digital quotient of CIMB staff in all job roles ranging from
Data, and Design) basic awareness on certification level to enable the Group’s digital transformation.
Academy • A total of 11,389 employees participated in 3D Academy programmes from Malaysia,
Indonesia, Singapore, Thailand and Cambodia across a variety of platforms (mobile,
virtual, e-learning, in-house and external 3D training).
• Delivered 78,219 training hours during the year, against the target of achieving
2.0 million hours by 2021.
• Launched 3D training via mobile platform in Malaysia and Singapore to liberalise
learning and making it accessible to all levels of employees anytime, anywhere.

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human capital development

Our 3D Academy competency The inaugural edition of the CIMB 3D Conquest came to a close on 18 January 2019
framework is anchored on with the grand finalé held in Le Méridien, Putrajaya. Organised in partnership with
leading brands such as SAS, AWS, Cloudera, Oracle, Fusionex and Malaysia Airlines,
six pillars, namely digital
the event aimed at positioning CIMB as an employer of diverse talent, attracting young
world awareness; agile and talent, especially in the digital space.
entrepreneurial thinking;
future communication Open to all undergraduates, the two-day finals hackathon shortlisted 33 finalist teams
skills; risk and governance; from Malaysia, Indonesia, Singapore, Vietnam, and Thailand.
human-centred design; and
In the spirit of inclusivity and developing digital skills among youth, the hackathon was
data science and analytics. divided into three tracks: Data Science, Coding and Fintech, allowing students from a
To raise our employees’ variety of backgrounds to form multi-skilled and pluri-disciplinary teams to devise
awareness, in 2019, we solutions based on real world case studies. Competitors were also coached and
launched Gametize – a 3D mentored by domain experts from various digital divisions within CIMB and partner
education series in gamified organisations. The teams competing for a cash prize of USD48,000 for each track and
the opportunity to visit Silicon Valley.
content on a mobile platform.
The finalists were assessed for their problem-solving skills, analytical prowess,
creativity, and also their ability to collaborate and communicate their vision. A total of 42
students were eventually recruited from the winners for TCB Digital, internships and
other digital business units, contributing to the objectives of one of our Forward23
strategic pivots – Technology & Data.

• Skills to help CIMB • Skills to manage, • Skills to design

‘digitise’ our business, analyse and translate products and services
products and services. the data we have into centred around people
• Digital-first mindset. meaningful insights (customers and
• Skills of current and that CIMB can employees) and the
emerging technologies capitalise on. ability to change our
to drive a seamless business model from
In 2019, we introduced the Digital
digital user what it is today.
Enablement Benefit. The benefit is
experiences.
targeted at junior-grades mainly to
ensure that all employees have
access to technology and digital
learning platforms such as Gametize
to gain new 3D skills, cloud-based
career planning and internal
personal branding tools such as
Y.O.D.A. Under the policy, eligible
permanent employees can claim up
to RM50 per month for their data
plan. This policy is in line with our
values of diversity and inclusion,
ensuring that we take all employees
forward with us. Our Group CEO, Tengku Dato’ Sri Zafrul Tengku Abdul Aziz, announced the winners, with cash prizes
an immersion trip to Silicon Valley.

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S T R AT E G I S E D A N D D E L I V E R E D T R A I N I N G A N D Progress in 2019
DE VELOPMENT

We consider continuous learning and development as critical to not

just be productive at the workplace but to also future-proof our
employees. We take an inclusive approach to designing and
3.0 million
TR A I N I N G H O U R S
delivering training and immersion programmes, including
employees from various functions and levels. To ensure the
pragmatic value of the content delivered is at optimum, we conduct
regular training needs assessments for all employees. Based on the
RM141
topics required, we deploy multiple learning methodologies million
and platforms. These include digital/online courses, TRAINING
I N VE STM E N T A C R OS S
class-room sessions, computer-based workshops etc. T H E R E GI O N

D E V E L O P E D TA L E N T P I P E L I N E F O R G R OW T H

Talent Development
At entry-level, we offer structured programmes to cater to various profiles and aspirations, providing young talent with options to pursue
under The Complete Banker™ (TCB) umbrella. The TCB programmes create a pipeline of talent for management roles.

TCB (Diversity Within Banking)

TCB is a 24-month management programme open to graduates of all disciplines. It provides young graduates with exposure and
experience in all areas of banking. With a recent curriculum upgrade, the programme now incorporates digital appreciation modules
and options to experience cultural and language immersion in China, and regional rotations or secondment to fintechs. A total of 48
graduates were recruited during the year from across ASEAN. 30% of them were from Science, Technology, Engineering and
Mathematics (STEM) and other non-finance and banking-related backgrounds.

TCB Fusion (Diversity Beyond Banking)

TCB Fusion is a 24 to 48-month programme that provides graduates with an opportunity to experience working in two different
companies. We partnered with leading organisations in various sectors during the year: PwC (Accounting), Accenture (Consulting), Zico
Law (Law), Teach for Malaysia (Non-profit) and DXC Technology (Technology). Upon successful completion of the programme, the
associates have the option to decide their preferred employer.

TCB Digital
TCB Digital is the most recent addition to the TCB suite, targeted at digital and technology talent. Recruitment started at the end of 2019
for the programme, scheduled to launch in early 2020.

In addition to the conventional training and development efforts, we also forged partnerships with institutions of excellence
to deliver world-class programmes for our high-potential employees, especially the ones in mission-critical roles.

CIMB-INSEAD
The CIMB-INSEAD partnership is our flagship leadership programme, which delivers bespoke leadership coaching to senior and top
management. During the year, the programme anchored around ‘Leading in the Fourth Industrial Revolution (IR4.0)’, and preparing
talent to navigate digital disruption. A total of 31 members of the management were required to complete an action learning project on
digital technology and innovation with exposure to venture capital style pitching. The project allowed participants to immerse in the
digital space through site visits and dialogues with industry practitioners from the start-up ecosystem in Paris. The participants had an
opportunity to further apply their learning with a Venture Capital (VC) challenge at the end of their training.

Accelerated Universal Bankers Programme

Another flagship initiative is our Accelerated Universal Bankers Programme, a customised leadership programme developed in
partnership with Nanyang Technological University. Targeted at middle management, the programme’s objectives are to encourage
cross-functional camaraderie and collaboration among middle managers, to prepare them for the IR4.0 and for senior management
roles through action learning projects, enabling cross-pollination of ideas and allowing them to become well-rounded bankers. More
than 33 members of our middle management successfully completed this programme in 2019.

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human capital development

P R E PA R E D E M P L OY E E S F O R CA R E E R
T R A N S I T I O N S A N D L I F E B E YO N D WO R K (GRI: 404-2)

Equipping Employees with Skills of the Future

After its launch in 2018, the Future of Work Centre (FOWC)

continued in its mission to provide a comprehensive approach
In 2019, we launched Y.O.D.A. - an acronym for Your Own
to future-proofing and getting our workforce ready for the digital
Digital Assistant. It is a mobile-enabled cloud-based Human
economy. FOWC offers a wide menu of options to meet
Resource Information System (HRIS) that empowers
the different career aspirations and varying personal
employees and allows them to take charge of their own
circumstances of our employees. Some of the career
careers through a number of features:
development interventions are as follows:

Upskilling and Reskilling

Employees are upskilled or reskilled to perform the roles that Design their
are currently in demand, with an aim of increasing individual own learning
employability within and beyond CIMB. The idea is also to help
employees grow their income and livelihood. As at 31
Digital Nominate a mentor or
December 2019, we have reskilled and upskilled 2,205
onboarding a mentee
employees regionally.

Internal Talent Mobility

The concept of internal mobility at CIMB is premised on growth Volunteer for Create or participate
and learning opportunities. Employees have the option to be community in community
considered for internal vacancies, with permanent transfers into projects learning
the new roles, internal internships to put into practice newly-
acquired skills, and stretch assignments over and above their
current roles. In 2019, we also facilitated internal mobility and Recognise or Access learning on
organised our first internal career fair for Forward23 and endorse colleagues the go
received 450 applications for 188 approved positions. Enhance
personal branding
FlexMyCareer (FMC)

In 2019, we introduced FlexMyCareer, an extension of the many

options already available to employees under FOWC. The main The platform is easy to use, intuitive and accessible on mobile
aim is to equip employees with more choices and more control devices, in line with cultivating a workforce with an agile and
over their career direction and growth. The additional choices digital-first mindset. In the end it is about giving employees a
include opportunities beyond banking, entrepreneurial ventures, personalised and wholesome employee experience.
passion projects or early retirement.

Under this scheme, employees are also offered a financial

assistance package, add-on medical benefit coverage and a
preferential rate for outstanding staff loans with CIMB, mainly to
We organised pre-retirement workshops to help employees
assist them to pursue their personal and professional goals.
transition from working life to retirement. The full-day event
titled “Forward Your Financial and Lifestyle Planning” brings
A Beyond Banking Opportunities Day was also organised with
together trainers and speakers from financial management
external partners consisting of workshops and talks for those
consultancies, healthcare and lifestyle management
keen to explore opportunities beyond banking.
providers to help our employees prepare for a stress-free
and productive retirement. In Malaysia, two sessions were
organised with a total of 105 participants.

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 In CIMB Thailand, we collaborated with the Thai Red Cross and
I M P R OV E D D I V E R S I T Y AT T H E WO R K P L AC E
offered special funds to the tune of THB3.0 million (RM396,000) to
Diversity of Skills suport a total of 27 PWDs. Meanwhile, we also hired three PWDs
to work in Operations, Investor Relations and HR departments.
The banking sector is evolving. Rapid advancement in
The collaboration has been active since 2016 and even extends to
technologies and digitalisation are changing the traditional
hiring blind therapists to promote and raise awareness on PWDs
business models of banks and the financial sector as a
among CIMBians. The efforts and positive impact from this
whole. Non-traditional and non-banking institutions are in line to
initiative have been awarded and recognised by the Social
secure banking licenses. Fintechs and digital solutions such as
Innovation Foundation and Ministry of Social Development
blockchain are redefining the customer experience and banking
and Human Security for three consecutive years.
itself. To meet the growing challenges that come with these
transformational and revolutionary sectoral developments, Gender Diversity
we continued to focus on developing the skill set of our
In 2019, 56.4% of the total workforce in CIMB comprised of
employees across all levels.
women. 47.5% of middle to top management positions comprised
About 50% of our Associates under our graduate associate of women.
programme, The Complete Banker (TCB) and the CIMB ASEAN
Scholarship Programme are from non-business disciplines such The Board of CIMB Group Holdings Berhad currently comprises
as engineering, mathematics, bio-medical sciences and nine Directors, of whom one is a female, or 11% representation.
psychology. In addition to recruiting from non-traditional pools, all The Board remains committed to achieve at least 30% female
of our Associates, regardless of their academic backgrounds, are representation on the Board by 2020, whilst ensuring that
given the opportunity to have job rotations beyond CIMB and the diversity in skill set, experience, age and gender are met. The
banking industry. These include opportunities in fintechs, start-ups GNRC is currently considering new candidates to be nominated
and online payment institutions, which help build internal to the Board and is mindful of this requirement.
capabilities across various business functions. This initiative
reinforces our commitment to equip our talent with critical skills The 30% female representation on the Boards target is also
required to compete in the digital economy. observed on the Boards of CIMB’s main subsidiaries. The
subsidiaries that have achieved more than 30% female
In 2019, we continued to monitor and assess the
representation on the Board are CIMB Bank Berhad (40%), and
credentials of our Board members at a Group level as well
CIMB Islamic Bank Berhad (33%). The CIMB Investment Bank
as the Senior Management to map their competencies in
Berhad Board is mindful of this requirement and is currently
critical areas such as Technology and Digitalisation; Compliance
reviewing its composition with the view to nominate more
and Enterprise Risk Management; Banking and Finance;
female candidates for the Board.
Accounting and Audit; Sustainability and Leadership. For instance,
with Sustainability as one of our five strategic pivots under
At entry level, we continue to ensure a robust pipeline of female
Forward23, 33% of our Board members are actively involved with
talent. 43% of the most recent intake of TCB, were female. The
non-profit environmental and or social organisations.
programme is an important source of high potential talent for
Diversity of Abilities our future management.

Inclusivity features strongly on our agenda and in line with

this approach, we employ 11 Persons With Disabilities (PWDs) in
Malaysia. CIMB Niaga also hired 12 new PWDs , adding on to the
existing 23 PWD workforce, who were placed as Social Media
Telemarketing Funding Officers and Personal Banking Officers.

Empowering Women Series

This was launched in August 2018 to enable CIMB women to gain inspiration from accomplished women leaders from diverse
sectors. In 2019, the programme, themed, “Removing the Glass Ceiling in the Corporate World”, featured three distinguished
speakers: Prof Emerita Datuk Dr Mazlan Othman, an Astrophysicist; Khai Lin Sng, Co-Founder of Fundnel, a technology-based
private investment platform; and Teoh Su Yin, Senior Independent Director of CIMB Group. More than 120 CIMB women and men
participated in this learning experience.

We also continued to celebrate the winning spirit of CIMB Women on International Women’s Day, with a full-day of activities including
a special panel featuring women from diverse backgrounds to speak on the topic of “Having It All – A Successful Career and a
Fulfilling Life”. The panel members who inspired many with their stories included Chong Chye Neo, a Board Member of several public
listed companies and former Managing Director of IBM Malaysia; Marion Caunter, a local celebrity; and Hiba Abdul Rahman, a cancer
survivor and breast cancer advocate.

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human capital development

E N C O U R AG E D A S P I R I N G YO U T H T O F U L F I L T H E I R L E A D E R S H I P P O T E N T I A L

CEO@Faculty
CIMB continuously engages with local institutions of higher learning, academicians and industry, through our own programmes as well
as through public sector initiatives such as CEO@Faculty, which started in 2015, as part of the Group’s contribution to the larger
national agenda.

The objective of these efforts is to bridge the gap between industry and academia by facilitating knowledge exchange, experience
sharing, curriculum design advisory as well as to provide much-needed support to young talent. It comes in the form of workshops and
mentoring, to raise career awareness among Malaysian undergraduates, especially to those in public institutions of higher learning.

In 2019, as part of the CEO@Faculty programme, Dato’ Hamidah Naziadin, Group Chief People Officer adopted UiTM and UKM to
conduct outreach programmes. A total of seven guest lectures to students and sharing sessions with faculty members were conducted
in 2019 on topics ranging from IR4.0 to diversity and inclusion, representing approximately 30 hours of lectures and sharing sessions
invested (excluding other activities).

As a result of the continued efforts over the years, Dato’ Hamidah was one of five industry leaders identified for recognition by the
Ministry of Education in 2019.

PROTÉGÉ
We also continued to support the Professional Training & Education for Growing Entrepreneurs programme, PROTÉGÉ
(formerly known as SL1M), to provide routes to employability and careers. 250 Malaysian graduates were recruited for placement across
various banking functions as part of an employability-enhancing graduate training scheme.

In addition to providing work experience, we organised nine training sessions covering the following areas:

Soft skills Financial Fundamentals Sustainability

literacy of marketing

Fundamentals Fundamentals Motivational talks

of of banking and on confidence and
entrepreneurship banking products career awareness

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 ASEAN Scholarship

Another flagship initiative is the CIMB ASEAN Scholarship. In 2019, we introduced a maximum annual household income
threshold of RM15,000 for Malaysian applicants. The main objective of this new requirement is to provide opportunity to
youth from low and modest income families who would otherwise miss out on quality education and exposure. The net is
cast wide to identify talent from different backgrounds, fields of study and location of study (in their own countries and
abroad) so that with this, they might bring their life experiences and perspectives to the table.

32%
of our scholars are pursuing STEM courses in fields of the scholars are
such as Engineering, Computer Science, Actuarial studying in their respective
Science and Mathematics home countries

In 2019, we offered close to RM5.0 million in scholarships to 13

talents from six ASEAN countries, with internships, mentorship
and guaranteed employment. The total allocation of RM38.9
million for 2016-2023 has benefited 63 students to date. We take
pride in our vision to nurture and develop a regional talent
pipeline for the Bank and in 2019, we realised this vision with the
return of nine graduates from the first cohort of the ASEAN
Scholarship programme.

CIMB Young ASEAN Leaders 2019

The CIMB Young ASEAN Leaders (CYAL) is an annual programme with an overarching objective to grow and nurture the best of our
young ASEAN leaders, and enable them to exchange ideas, broaden their perspectives, as well as gain cross-cultural experiences,
while exploring a theme that is relevant to all ASEAN countries.

In 2019, 50 delegates from all 10 ASEAN nations convened in Kuala Lumpur to deliberate and exchange ideas on the theme
“Sustainable Indigenous Resources for Renewable Energy”. The Group explored how ASEAN countries can utilise renewable local
natural resources to provide energy to sustain life and economic needs.

Since 2012, CYAL has produced an alumni community of 350 bright individuals across ASEAN. During the CIMB Young ASEAN
Leaders 2019, CIMB Foundation launched the CYAL Alumni to engage the alumni community and ensure continuing impact.

The CYAL Alumni aims to:

• Further enhance cross-cultural learning and partnership between ASEAN countries;
• Provide further opportunities for the CYAL Alumni to inspire and enact change in their home country;
• Provide further growth and career opportunities for the CYAL Alumni to develop their leadership capabilities and achieve their
potential; and
• Act as ambassadors for CIMB’s regional CSR initiatives.

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human capital development

I N T R O D U C E D A M O R E H O L I S T I C P E R F O R M A N C E A P P R A I S A L SYS T E M

The Group’s performance is tracked via a balanced scorecard with measures on profitability, cost, capital, shareholders’ return, medium to
long-term strategic initiatives, as well as risk, audit and compliance. These success measures are cascaded through the organisation
through KPI scorecards of individuals.

Likewise, individual KPIs are based on a balanced scorecard, covering:

• financial targets
• customer experience measures
• long-term initiatives (where progress of milestones or ROI may be monitored)
• risk management and process controls
• audit and compliance findings
• people-related measures.

Year-end assessments of individual performance are based on KPI achievements as well as the individual’s proficiency in required
competencies.

In 2019, KPIs were aligned towards our Forward23 strategy, with long-term focus areas on customers, technology, sustainability,
partnerships and people. Emphasis continued on risk-adjusted performance measures such as risk-adjusted return on capital as well as
reinforcing our culture of accountability and compliance. 100% of senior management’s scorecards in 2019 were developed centrally to
ensure alignment to organisational priorities.

During the year, we piloted newer approaches to performance management to include more regular conversations with employees, with
strong focus on employee growth and career development.

We also piloted a new compensation model that enhances linkage of pay to performance, and provides a clearer line of sight to drive
performance.

For more information on our progressive policies and

programmes on employee welfare and well-being,
refer to CIMB Group Sustainability Report 2019.

98
 group

BOARD OF DIRECTORS

BOARD COMMITTEES

GROUP CORPORATE ASSURANCE

GROUP RISK

GROUP LEGAL & COMPLIANCE

GROUP CHIEF
EXECUTIVE OFFICER

GROUP COMPANY SECRETARY

GROUP CORPORATE RESPONSIBILITY

COUNTRY HEADS
GROUP STRATEGIC COMMUNICATION

GROUP WHOLESALE BANKING GROUP STRATEGY & DESIGN

GROUP CONSUMER BANKING GROUP HUMAN RESOURCE

GROUP COMMERCIAL BANKING GROUP CHIEF OPERATING OFFICER

GROUP TRANSACTION BANKING GROUP FINANCE

GROUP ISLAMIC BANKING GROUP TECHNOLOGY

GROUP VENTURES & PARTNERSHIPS GROUP OPERATIONS

BUSINESS UNITS BUSINESS ENABLERS

99
chairman’s statement on

D E A R S H A R E H O L D E R S ,

We are seeing a world that is transforming fast. The rules of the game we call business are changing even faster.
Corporate Governance may have been about health and hygiene, but is potentially taken for granted, with environmental and
social performance requiring attention and prioritisation.

“It is my privilege to present the CIMB 2019 Corporate Governance Overview

Statement, which speaks of our continuing efforts to strengthen stakeholder’
trust and manage our risk exposure through robust governance frameworks
and practices. While we remain vigilant of the emerging risks to business
requiring strong governance, we recognise the need for efficient monitoring
and control mechanisms to meet our near-term goals and business priorities.
In representing the universal regional ASEAN banking group, on behalf of the
Board, I would like to reinforce my faith in the capabilities of the Group to
safeguard the interests of our shareholders and stakeholders through
governance at its best.”

In early 2019, we witnessed a US Company, Pacific Gas and In short, our efforts at CIMB are to continuously evaluate our
Electric Company (PG&E) filing for bankruptcy protection, while existing systems towards shaping a robust governance framework
Sustainalytics, an independent global provider of Environmental, – one that achieves a balance between near-term and mid-term
Social and Governance (ESG) and corporate governance research business performance needs and long-term risks. This requires us
and ratings to investors, named this global leader an outperformer to expand the criteria on which our governance practices are
and ranked it in the 82nd percentile on governance. The PG&E is measured for their practical value for business and their ability to
the first corporate casualty of climate change, mainly contributed by future-proof us and our people.
failure in governance and management. This could be true for any
aspiring businesses as they grapple with the emerging ESG issues The Board of CIMB is painstakingly diligent in its role, ensuring the
and risks into the future. members deliberate on governance approaches and issues
adequately, including risks and matters material for both business
At CIMB, sustainability is one of the five key focus areas of our and stakeholders. From incorporating governance and Economic,
Forward23. In implementation, governance alongside economic, Environmental and Social (EES) risks into the Enterprise Risk
environmental and social aspects of our business are pivotal to Management Framework to how they impact key decisions on
meet the objectives and targets defined for the five-year term. In business and growth, the Board takes full accountability for positive
other words, we believe that governance can have the highest performance on various means and metrics to good governance.
impact on the efficiency, effectiveness and value creation ability of The Board recognises that such high-degree commitment is
our deployed strategies and approaches. Therefore, we go beyond non-negotiable and most critical to deliver shareholder and
management structures, policies and processes, and make stakeholder value.
governance an integral part of the organisational culture. We place
equal emphasis on adherence to the principles of good Future Forward, good corporate governance will always be one of
governance, especially when taking mission-critical decisions on a our main priorities as a leading bank in Malaysia. We will continue to
day-to-day basis, never losing sight of the emerging challenges of be vigilant and ready to take it to the next level in order to protect
the future. the interests of all stakeholders.

Datuk Mohd Nasir Ahmad

Chairman
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 corporate governance
(Pursuant to Paragraph 15.25(1) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad)

CIMB is strongly committed to ensuring that its systems, procedures and practices reflect a high standard
of corporate governance. It has a well-defined and well-structured corporate governance framework in
place to support the Board’s aim of achieving long-term and sustainable value, as well as fostering a
culture that values ethical behaviour, integrity and respect to protect shareholders’ and other
stakeholders’ interests at all times.

For CIMB, it is also important to maintain leading governance 7) Best E-Payment Bank awarded by Malaysia e-Payments
practices given the highly regulated industry in which the Group Excellence Awards (MEEA) 2019
operates and this is essential for the long-term sustainability of the
8) Best IBFT Bank awarded by Malaysia e-Payments Excellence
Group’s businesses. In this respect, the Board Committees assist
Awards (MEEA) 2019
the Board to fulfil its governance role effectively.
9) Best Islamic Finance Sukuk House awarded by Alpha SEA
During the year ended 31 December 2019, CIMB’s corporate Regional Islamic Finance Awards 2019
governance practices were consistent and complied with the
10) Best Sukuk Bank awarded by Global Finance World’s Best
following guidelines and best practices:
Islamic Financial Institutions Awards 2019
1) Bank Negara Malaysia (BNM)’s Corporate Governance Policy
11) Best FX Bank for Corporate Islamic Treasury – awarded by
2016 (BNM CG Policy)
Alpha SEA Regional Islamic Finance Awards 2019
2) Main Market Listing Requirements (MMLR) of Bursa Malaysia
12) Best Cash Management Bank in Malaysia awarded by Alpha
Securities Berhad (Bursa Malaysia)
SEA Best Financial Institution Awards 2019
3) Malaysian Code of Corporate Governance 2017 (MCCG)
13) Best Equity House in Malaysia awarded by Alpha SEA Best
published by the Securities Commission
Financial Institution Awards 2019
4) Corporate Governance Guide 3rd Edition 2017 (CG Guide)
14) Best Institutional Broker in Malaysia awarded by Alpha SEA
published by Bursa Malaysia
Best Financial Institution Awards 2019
5) Minority Shareholder Watch Group (MSWG)’s Malaysia-
15) Best Digital Bank in Malaysia awarded by the Asian Banker
ASEAN Corporate Governance Scorecard
Excellence in Retail Financial Services Awards 2019
6) Developments in market practice and regulations
16) Best Retail Bank in Malaysia awarded by the Asian Banker
Excellence in Retail Financial Services Awards 2019
The Board and its Committees regularly review the governance
framework and associated practices to ensure that they keep
Whilst Shareholders and the Board jointly provide oversight on the
abreast with relevant corporate governance and regulatory
control and management of CIMB, the ultimate decision-making
requirements.
authority rests with the Shareholders at the Annual General Meeting
(AGM) where, amongst others, the re-election and remuneration of
In 2019, CIMB received, amongst others, the following awards for
the Directors and appointment of External Auditors are approved.
its group-wide efforts in upholding the highest standards of
The Board, on the other hand, is accountable to the Shareholders
corporate governance and ethical conduct:
for the performance of CIMB. In this regard, the Board directs and
1) Industry Excellence Award – Finance (1st place) awarded by monitors the business and affairs of CIMB on behalf of the
MSWG – ASEAN Corporate Governance Awards 2018 Shareholders. The Board also oversees and appraises CIMB’s
overall strategic objectives, direction and performance, with some
2) Excellence Award for CG Disclosure (1st place) awarded by
oversight delegated to the Board Committees.
MSWG - ASEAN Corporate Governance Awards 2018
3) Excellence Award for Overall CG & Performance (4th place) The Group Chief Executive Officer/Executive Director (Group CEO),
awarded by MSWG – ASEAN Corporate Governance Awards who also sits on the Board as the sole Executive Director, is
2018 responsible for the development and implementation of CIMB’s
strategy and its overall day-to-day running. Consistent with CIMB’s
4) Most Outstanding Annual Report of the Year (Platinum)
primary objective to enhance long-term shareholder value, this
awarded by National Annual Corporate Report Awards
includes providing direction on all aspects of operational matters
(NACRA) 2019
such as financial, risk management and compliance. The Board
5) Industry Excellence Award (Finance) awarded by NACRA 2019 delegates to the Group CEO, together with the Senior Management
of CIMB, the authority for managing CIMB’s business to achieve its
6) Sustainability Reporting Award (Gold) awarded by NACRA
corporate targets and plans.
2019

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corporate governance overview statement

Shareholders

Board of Directors

Group Nomination
Board Risk & Group Shariah
Audit Committee & Remuneration
Compliance Committe Committee
Committee

Group CEO

Group EXCO

Group-wide Committees Divisional Committees Country-level Committees

ENTITY GOVERNANCE
PRINCIPLE A: B OA R D L E A D E R S H I P A N D
CIMB recognises that while the ultimate parent entity in the EFFECTIVENESS
Group has the overall decision-making authority and is
responsible for exercising adequate oversight over the group BOARD RESPONSIBILITIES
entities, the ultimate parent entity must nevertheless give due The Board’s primary role is to determine CIMB’s
regard to these entities to exercise their own judgment. strategic objectives and policies to deliver
sustainable value to its Shareholders. In ensuring
The CIMB Group operates through a diverse set of entities and the protection and enhancement of shareholder value, it takes into
ownership structures which may pose governance risks for the account the interests of stakeholders including employees,
Group and for the individuals who are responsible for the customers, suppliers, business partners, regulators, local
management of these entities. In 2017, a governance framework communities, non-governmental organisations and the general
was developed to address such risks and ensure that the public. The Board is ultimately accountable to Shareholders for the
operations of the entities remain robust. The framework serves performance of CIMB, and is responsible for CIMB’s overall
to raise the bar for CIMB’s governance standards and focuses governance.
on accountability of the Group’s senior management. The
framework also provides channels of communication to align The Board acknowledges the importance of a clear division of
the relationship between these entities, as well as with CIMB. responsibility between the Chairperson and the Group CEO. The
roles of Chairperson and Group CEO are therefore exercised by
To operationalise the framework, the Group Entity Governance separate individuals to ensure optimal balance, resulting in
Policy (Policy) was approved by the Board of CIMB in late 2017. increased accountability and enhanced decision-making. The
Central to the Policy is the appointment of a “Responsible Board is helmed by Datuk Mohd Nasir Ahmad, an Independent
Officer” who is accountable for the entities assigned to him/her. Director, who plays a key role in ensuring the Board operates
The main role of a Responsible Officer is to escalate any issues effectively and fully discharges its legal and regulatory
to its Board and the Board of its parent entity, amongst others, responsibilities. As the Chairperson, he also leads the Board in the
that may impact the entity’s operations as well as the Group’s in oversight of the Management and in inculcating the right culture,
a timely manner. Designated key control functions are identified values and behaviours, both at the top and throughout the entire
to support the Responsible Officer in his/her role. organisation. Notwithstanding that Datuk Mohd Nasir is an
Independent Chairperson, the Board nevertheless retained the role
Since its introduction in 2017, the Policy has reached its final of Senior Independent Director (SID) on the Board, whose role is to
phase with its full implementation from June 2019. The Policy serve as a sounding board to the Chairperson, a representative of
will continue to be reviewed to reflect best practices as well as the Non-Executive Directors and also act as an additional point of
to align with regulations. contact for all stakeholders who wish to convey any concerns in
relation to CIMB Group. The Board has designated Teoh Su Yin as
the SID.

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The Board delegates responsibility for the overall business and In terms of Board and Board Committee meetings, the Board
day-to-day management of CIMB to the Group CEO, Tengku Dato’ Charter provides that Directors should receive meeting materials
Sri Zafrul Tengku Abdul Aziz. The Group CEO is responsible for five days prior to the Board meeting to allow sufficient time for
leading Management and for making and implementing operational Directors to review and analyse relevant information. The
decisions, and is assisted by the Group Executive Committee. deliberations and decisions arrived at during Board meetings are
clearly minuted in a timely manner and action items for
To further promote CIMB’s sustainability agenda, the Board has Management will be communicated to the relevant parties within 24
designated Robert Coombe as CIMB’s Sustainability Sponsor. His hours after the Board meetings. The draft minutes are then tabled
role includes advising and recommending to the Board on business at the following meeting for confirmation and thereafter signed by
strategies from the aspect of sustainability and acts as an advocate the Chairperson.
within the organisation and externally.
The Board meets on a regular basis, with a minimum of six
The Board has appointed the Group Company Secretary who, scheduled meetings in a financial year or at least once every two
under the direction of the Chairperson, is accountable for all months or more frequently as circumstances dictate. The dates of
matters with regard to the proper functioning of the Board as well these scheduled meetings are determined well in advance to enable
as to facilitate effective information flows within the Board and the Directors to plan ahead. In addition to the scheduled meetings,
Board Committees and between Senior Management and Non- Special Meetings may be convened as and when required. All
Executive Directors. The Group Company Secretary is also tasked Directors attended more than 75% of all Board meetings held in
to facilitate the induction of new Directors and the ongoing FYE 2019, and physically attended more than 60% of the
professional development of all Directors. Datin Rossaya Mohd scheduled Board meetings. Members of Senior Management have
Nashir is currently the Group Company Secretary and has been also been invited to attend selected Board meetings to support the
with the Group since 2002. Board with further information on the matters being deliberated. In
addition to the scheduled meetings, the Non-Executive Directors
The roles of the Chairperson, SID, Group CEO, Sustainability have a framework and forum to meet separately to discuss specific
Sponsor and Group Company Secretary are specified clearly in the matters without any executives present.
Board Charter.
Number of meetings convened by the Board and each Board
CIMB’s Board Charter sets out the Board’s strategic intent, Committee
authority and terms of reference and serves as a primary source of
reference and induction literature. In addition, the Board Charter Number of
outlines the requirements, roles and responsibilities of the Board, meetings in 2019
Board Committees and individual Directors. To ensure that it Board 16
remains relevant, the Board Charter is reviewed every three years or
as change arises to ensure CIMB remains at the forefront of best Audit Committee 17
practices in governance. The Board Charter is available at CIMB
Board Risk and Compliance Committee 7
website at [Link].
Group Nomination and Remuneration 16
Committee
Group Shariah Committee 8

Roles and responsibilities of the Board and Board Committees

Main Areas of Oversight Number of meetings in 2019

Board The Board is responsible for the following: 17 meetings held to deliberate, amongst others, on
• Comprises nine • Strategic/business plans of CIMB and the the following:
Members of whom monitoring of Management’s success in • Matters relating to the Company, the three
six Members are implementing the strategies and plans; and CIMB’s Malaysian banking institutions and regional
Independent annual budget subsidiaries
Directors • Conduct of CIMB’s business • CIMB’s Budget
• Identifying principal risks and ensuring the • CEO’s Quarterly Report
implementation of appropriate internal controls and • Quarterly Capital Management Update
mitigation measures • Quarterly Shareholder Statistics Update
• Succession planning • Quarterly Report on Directors’ Training,
• CIMB’s Communications Policy Directorships and Summary of Dealings outside
• CIMB’s governance and internal control frameworks Closed Period

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corporate governance overview statement

Main Areas of Oversight Number of meetings in 2019

Board (continued) • Group CEO’s and Directors’ appointments and their • Report from AC and GNRC
emoluments and benefits • CIMB Group Risk Posture
• Effectiveness and performance of the Board • Financial Statements
Committees of CIMB annually • Interim Dividends
• Considering and approving the Financial • Formalisation/Updates to Group Policies
Statements and interim dividend and recommend • Re-appointment of External Auditors for the FYE
the final dividend to Shareholders prior to public 31 December 2019
announcements and publications as well as all • MFRS/IFRS 9
circulars and press releases • Business Units Updates and Projects
• Monitoring the performance of CIMB • Basel II/Pillar 3 Disclosures
• Approving the changes on Corporate Organisation • Performance Assessment and Proposed
Structure of CIMB Compensation for Executive Director
• Ensuring that there are adequate controls and • Compliance’s Quarterly Report
systems in place to measure the implementation of • Anti-Money Laundering/CFT Report
the Group’s policies • Revision to the Terms of Reference of Board and
• Reviewing the adequacy and integrity of CIMB’s Board Committees
internal control systems and management • Revision to the Board Charter
information systems • Board’s Annual Evaluation on the Effectiveness of
• Overseeing the decisions and actions of the Management of Compliance Risk
Management in achieving the Group’s goal to be a • CIMB Niaga 2019 Recovery Plan Update
sustainable organisation, taking into account key • KPI Scorecard for Group CEO
issues related to EES aspects and impacts to the • Governance on Remuneration of Senior
Group’s business activities. Management and Material Risk Takers
• Annual Evaluation Exercise for Board and Key
Responsible Persons
• Gap Analysis on Amendments to the Bursa
Securities Main Market Listing Requirements
• Forward23 – Strategy
• Annual Insurance Programme Renewal
• Touch & Go related matters
• Sustainability Framework, Policy and Progress

Audit Committee The AC has oversight and is responsible for the 17 meetings held to deliberate, amongst others, on
(AC) following: the following:
• Comprises three • Financial Reporting • Matters relating to CIMB, the three Malaysian
Members, all of • Internal controls banking institutions and regional subsidiaries
whom are • Internal audit function • Matters relating to other non-banking subsidiaries
Independent • External audit reports of the Group
Directors • Related Party Transactions • Annual Performance Review for Group Corporate
Assurance Division (GCAD) and Group Chief
Internal Auditor
• GCAD’s KPIs for 2019
• Group Chief Internal Auditor and Direct Reports
KPIs for 2019
• Two meetings with External Auditors without the
presence of Senior Management
• Documents pertaining to Annual Report 2018
• Related Party Transactions
• Review of Financial Results
• Update on AC’s Terms of Reference
• MFRS/IFRS 9 updates
• Reappointment of External Auditors
• GCAD’s Annual Audit Plan
• GCAD’s 2019 Mid-year Review Plan
• GCAD’s revised Audit Plan

104
 Main Areas of Oversight Number of meetings in 2019

AC (continued) • Audit and Non-Audit Services provided by External

Auditors
• Review of Performance Management System
• Update on GCAD’s Policy
• Updates on the Existing Guidelines for the
Appointment and Re-appointment of CIMB Group
External Auditors
• Whistleblowing Investigation Process Flow
• Forward23 – Review on Cost and Productivity
• Data Analytics
• GCAD’s Key Strategic Projects

Board Risk and The BRCC has oversight and is responsible for the Seven meetings to deliberate, amongst others, on the
Compliance following: following:
Committee (BRCC) • Risk appetite • Risk Management Policies
• Comprises seven • Risk governance • Risk Appetite for 2019
Members of whom • Risk frameworks • Risk Profile and Strategy
five (including the • Risk management practices and policies • Risk Management Objectives
BRCC Chairperson) • Risk strategy • Economics Position and updates
are Independent • Compliance Risk • Compliance to Risk Posture
Directors • Risk and Compliance Culture • Demerit framework on Performance Ratings
• All Members are • Oversight on IT Risks • Revisions to the Terms of Reference of the BRCC
Non-Executive • Compliance Framework • Revised Market Risk Limit Framework of Group
Directors • Anti-Money Laundering/Counter Financing Wholesale Banking for 2019
Terrorism Risk Appetite • Updates on Guidelines and Policy Documents
• Compliance and Anti-Money Laundering/Counter Related to Outsourcing
Financing Terrorism Strategy • Group Compliance Reports
• Compliance Work Plan for 2019
• KPI Scorecard for Group Chief Risk Officer and
Group Chief Compliance Officer
• Annual Performance Review for Group Chief Risk
Officer and Group Chief Compliance Officer

Group Nomination The GNRC has oversight and is responsible for the 16 meetings held to deliberate, amongst others, on
and Remuneration following: the following:
Committee (GNRC) • Boards’ and Board Committees’ Composition • Board and Board Committees’ Composition
• Comprises six • Annual Evaluation exercise comprising: • Annual Evaluation exercise
Members of whom – Board Effectiveness Assessment • Remuneration of Board, Group CEO/EDs, SOs and
five Members – Fit and Proper Assessment of Directors, Chief MRTs
(including the GNRC Executive Officers/Executive Directors (CEOs/ • Setting of KPIs for Group CEO/ED
Chairperson), are EDs), Group Shariah Committee Members & • Policies on governance of the Group
Independent Company Secretary • Directors’ Development Plan
Directors • Succession planning for Boards, Board • Revision to the Terms of Reference of the GNRC
• All Members are Committees, CEOs/EDs and Senior Management • Renewal of appointment of Group Shariah
Non-Executive • Reviewing remuneration packages based on the Committee Members
Directors Group’s existing remuneration guidelines and • Review of CIMB Niaga’s remuneration framework
framework for: • Macro structure and leadership changes
– Directors • Board and Committee succession planning
– Members of the Board Committees • Succession Plan for SOs
– CEOs/EDs
– Senior Officers (SOs)
– Material Risk Takers (MRTs)
• Governance matters in relation to the Board and
Directors
• Directors’ Development Plans

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corporate governance overview statement

Description of training and education provided to the Board during FYE 2019:

Mode of Duration in
List of training attended training day(s)
Accounting and Audit
Association of Chartered Certified Accountants (ACCA): ACCA Council Training Seminar 1
CIMB: Regional Audit Planning Summit Conference 2
Capital Markets
CIMB: Board Training Session, Morphic Asset Management Seminar 1
Securities Industry Development Corporation: Business Foresight Forum 2019: New Business Forum 1
Direction 2035, Catalysts for Change
Malaysian Economic Association: Conference Malaysian Economic Convention Conference 1
Financial Industry
CIMB Preferred: Financial Advisory Series 2019 Conference 1
World Bank Group and Cagamas: Conference on Constructing and Financing Affordable Housing Conference 2
Across Asia
Governance
Securities Commission: Corporate Governance Monitor 2019 Conference 1
Emeritus Professor Jean-Phillippe Deschamps: A Boardroom Colloquium on Innovation Governance Seminar 1
Asian Corporate Governance Association: Corporate Governance Watch – How Does Malaysia Rank Conference 1
Securities Commission: Briefing on Corporate Liability Provision and Anti-Corruption Workshop 1
Malaysian Institute of Corporate Governance: Forum on Corporate Governance in the Capital Market Forum 1
Complying with Section 17A of MACC Act 2009 Forum 1
Malaysian Anti-Corruption Commission (MACC): Enhancing Corporate Governance by Understanding Seminar 1
Legal Liabilities “Act or Resign”
Information Technology
Bank Negara Malaysia (BNM)/Financial Institutions Directors’ Education (FIDE): Dialogue with the Dialogue 1
Deputy Governor on the Draft Risk Management in Technology Policy
CIMB: Technology Risk Workshop Workshop 1
BNM/FIDE: Digital Assets – Global Trends, Legal Requirements and Opportunities for Financial Conference 1
Institutions
Knowledge Group: Malaysia Technology Week 2019 Conference 1
BNM: MyFintech Week and Financial Industry Conference 2019 Conference 3
CIMB: Technology 101 Briefing Seminar 1
BNM/FIDE: Artificial Intelligence and Its Role in FI Conference 1
Leadership & Strategy
CIMB: 3rd Directors Regional Sharing Session 2019 Dialogue 2
CIMB Young ASEAN Leaders 2019 Seminar 1
Prof Anil K. Gupta: 2nd Distinguished Board Leadership Series: Rethinking Strategy Conference 1
Bursa Malaysia: Invest Malaysia Kuala Lumpur 2019 Conference 2
Dr Andy Xie: Reading the Signs – The Next Financial Crisis and Potential Impact on Asia Invest Conference 1
Malaysia 2019
World Economic Forum Annual Meeting 2019 Forum 4

106
 Mode of Duration in
List of training attended training day(s)
Leadership & Strategy (continued)
PNB Corporate Summit Conference 1
Kuala Lumpur Business Club: Budget 2020 Leading into the 12th Malaysia Plan Dialogue 1
Sovereign Investor Institute (SII): SII Global Government Funds Roundtable 2019 Dialogue 3
Khazanah Megatrends Forum 2019 Forum 2
CIMB Group: Annual Management Summit 2019 Conference 2
CIMB: Annual Malaysia Corporate Day Conference 1
CIMB: Board European Innovation Safari Others 6
Bursa Malaysia: Demystifying The Diversity Conundrum – The Road to Business Excellence Conference 1
ICLIF Leadership and Governance Centre: Mandatory Accreditation Programme Workshop 2
Perdana Leadership Foundation: CEO Forum 2019 Forum 1
Risk Management
BNM/FIDE: Annual Dialogue with the CEO of Perbadanan Insurans Deposit Malaysia (PIDM) Dialogue 1
BNM/FIDE: ISRA Programme – Value Based Intermediation: Directors Role Workshop 1
Macquarie: Asean Conference 2019 – Malaysia Macro And Policy Day Conference 1
CIMB: Risk Management Course Seminar 2
Others – Banking & Finance Related
CIMB: Media Training Seminar 1
Milken Institute: Asia Summit 2019 Conference 2
Sustainability
BNM: Regional Conference on Climate Change Conference 1
CIMB Group: The Cooler Earth Sustainability Summit Conference 2
Institute of Corporate Directors Malaysia: Climate Government Initiative Conference 1
UNEP FI: Social & Environmental Risk and Opportunities for Financial Services Players Dialogue 1
Shook Lin & Bok: Legal Risks Arising from Environmental Issues Dialogue 1

Time spent on training during FYE 2019:

Time Spent Time Spent

Directors in day(s) Directors in day(s)

Datuk Mohd Nasir Ahmad 32 Tongurai Limpiti 2

(appointed on 7 May 2019; resigned on
Teoh Su Yin 8
30 December 2019)
Robert Neil Coombe 3
Glenn Muhammad Surya Yusuf –
Dato’ Mohamed Ross Mohd Din 18 (resigned on 23 January 2019)

Dato’ Lee Kok Kwan 16 Watanan Petersik –

(resigned on 24 January 2019)
Ahmad Zulqarnain Che Onn 18
Tengku Dato Sri’ Zafrul Tengku Abdul Aziz 28
Afzal bin Abdul Rahim 12
(appointed on 31 January 2019)

Didi Syafruddin Yahya 24

(appointed on 7 May 2019)

107
corporate governance overview statement

The Board has also established a Code of Conduct which is Board Composition of Directors
underpinned by the core philosophy of “Creating Value, Enabling
Our People and Acting with Integrity”. The Code of Conduct sets Non-Independent
Directors
out the standards of behavior that are expected of all employees of 33%
CIMB in terms of engagement with customers, business Independent
Directors
associates, regulators, colleagues and other stakeholders. Further, 67%
the Code of Conduct provides guidance in areas where employees
may need to make personal and ethical decisions. In addition to
providing guidance, the Code of Conduct makes references to
specific Group Policies and Procedures relating to conflicts of
interest, bribery, corruption, money laundering/counter-financing of
terrorism, customer management, whistle blowing and fraud
management. In addition, the Board has also adopted a Code of
Conduct for Directors that sets out the fundamental guiding
principles and standards for Directors to carry out their duties. This Board Member’s Tenure
Code applies to all the Directors of CIMB Group and is primarily
based on the five fundamental principles of competence, integrity,
fairness, confidentiality and objectivity as recommended by the Below
Code of Ethics for the Financial Services Industry published by 3 Years
Financial Services Professional Board (FSPB).
3 Years –
CIMB’s Whistle Blowing Policy sets out avenues for legitimate Below
6 Years
concerns to be objectively investigated and addressed. Under this
Policy, individuals will be able to raise concerns about illegal,
unethical or questionable practices in confidence and without the 0 5 10
risk of reprisal. CIMB’s Whistle Blowing Policy is applicable to all
employees, suppliers, vendors, associated stakeholders and
CIMB’s customers.
The oversight on the overall composition of the Board and Board
Committees resides with the GNRC. The GNRC comprises six
BOARD COMPOSITION Members of whom five Members (including Teoh Su Yin, the
Chairperson) are Independent Directors. The GNRC is guided by
The Board continuously strives to ensure that Directors have a the following quantitative and qualitative criteria when assessing the
collective mix of skills, experience, expertise and diversity to add suitability of Directors for nomination:
value to Board processes and decisions.
• appropriate size and the balance between Independent
The Board currently comprises nine Directors, eight male and one Directors, Non-Independent Directors and Executive Directors,
female, of whom six are Independent, two are Non-Independent • skills, background and experience,
and the Group CEO, who is the Executive Director. Of the two
Non-Independent Directors, one had previously served in various • diversity in terms of gender, nationality, ethnicity and geography,
executive positions in CIMB. The other Non-Independent Director and
represents Khazanah Nasional Berhad, who is the largest major • commitment to sustainability.
shareholder of CIMB.
In addition, the behaviours likely to be demonstrated by potential
On 7 May 2019, CIMB welcomed two new Independent Directors to Non-Executive Directors will also be considered by the GNRC
the Board, Didi Syafruddin Yahya and Tongurai Limpiti. Tongurai during interview sessions for new appointments to ensure an
later resigned from the Board on 30 December 2019. The Board environment in which challenge is expected, achieved and
bade farewell to Glenn Muhammad Surya Yusuf and Watanan maintained in the boardroom.
Petersik who retired on 23 January and 24 January 2019,
respectively. Both Glenn and Watanan had served on the Board as Based on these criteria, suitable candidates will be identified to fill
Independent Directors since January 2010. vacancies on the Board and Board Committees as and when they
arise. The GNRC has access to a wide pool of candidates which
During FYE 2019, no Independent Director had served on the Board includes recommendations by existing Board Members or
for more than nine years from the date of his/her first appointment. Management and through external sources such as the Directors’
This is in adherence to CIMB’s Board Charter which limits an Register by FIDE FORUM and BNM; professional associations and
Independent Director’s tenure of service to a maximum of nine years. also from independent search firms.

108
In 2019, a self-evaluation exercise was conducted to determine the Board Members’ Industry/Background Experience
skills and experiences currently present on the Board. The results
of the exercise were extracted into a Board Skills Matrix, from which Accounting and Audit
the GNRC established a Board DNA to identify the desired profile of Banking and Finance
new Board Members to optimise the Board’s composition. Legal
Risk Management
Capital Market
The GNRC is also tasked to assess the effectiveness of the Board, Operations
Board Committees, individual Directors and the Group Company Information Technology
Secretary. The areas assessed under each category amongst Consumer Marketing
Human Resource
others were as follows: Corporate Leadership
Strategy Development & Implementation
• Board and Board Committees Innovation & Transformation
o Role played by the Chairperson Learning & Development
o Contributions by the Directors International Experience

o Board processes and information flow 0 1 2 3 4 5 6 7

o Boardroom dynamics
• 360° Peer Assessment
Board Members’ Nationality
o Understanding of the Group’s strategy and vision
o Knowledge, skills and experience
10
o Participation and contribution in deliberations
o Willingness to challenge prevailing opinion

From the 2019 exercise for FYE 2018 Board Effectiveness

5
Assessment, the Board approved an action plan to address areas
identified to improve the performance of the Board and
Management.
0
Pursuant to the Annual Evaluation Manual, an external consultant
Australian Indonesian Malaysian
will be engaged to conduct an independent assessment exercise
on the Board, Board Committees, individual Directors and the
Group Company Secretary for FYE 2019 in 1Q 2020. External
consultants are engaged for this exercise once every 3 years, with
the last independent exercise conducted in 2016. This is in line with REMUNERATION
the requirement in BNM’s CG Policy.
The Board delegates to the GNRC the responsibility to set the
Gender Diversity overarching principles, parameters and governance framework
relating to the Group’s remuneration matters. These have been
Female documented in the CIMB Group Directors’ Remuneration
11%
Framework and CIMB Group Remuneration Policy.
Male
89% CIMB Group Directors’ Remuneration Framework:

The CIMB Group Directors’ Remuneration Framework (Framework)

sets out the methodology and formula on how Retainer Fees,
Chairperson’s Premium and Meeting Fees of the Board are derived,
as follows:
• Comparison against CIMB’s industry peers;
• BNM FIDE Forum Directors’ Remuneration Report 2015
formula; and
Age Diversity
• Back testing the data against closest peers.
50 Years Old Below
and Above 50 Years Old The implementation of the Framework has been approved by the
56% 44%
Shareholders at the 60th Annual General Meeting which was held in
2017 and is reviewed every 3 years by the Board through the
GNRC. The Framework is designed to recognise the contribution of
the Directors in relation to its fiduciary and statutory duties, risks
and time commitment. The framework also serves to attract and
retain Directors who have the desired experience and skills from
various sectors.

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corporate governance overview statement

CIMB has established the Framework as follows:

Retainer Fees Chairperson’s Premium Meeting Fees

CIMB Group Holdings Berhad (per annum) (per annum) (per meeting)

Board Chairperson* 170,000 510,000 5,000

Member 170,000 N/A 5,000

Audit Committee Chairperson N/A 100,000 5,000

Member N/A N/A 5,000

Board Risk and Compliance Chairperson N/A 100,000 5,000

Committee Member N/A N/A 5,000

Group Nomination and Chairperson N/A 100,000 5,000

Remuneration Committee Member N/A N/A 5,000

* Benefits-in-kind for the Chairperson of the Board include, amongst others, a driver, corporate club membership subscription and leave passage.

The remuneration payable to the Directors by CIMB Group in 2019, are as follows:
CIMB

Salary and/
or Other
Fees Remuneration Total Benefits-in-kind
Directors (RM’000) (RM’000) (RM’000) (RM’000)

Non-Executive Directors
Datuk Mohd Nasir Ahmad 170 790 960 35
Teoh Su Yin 170 355 525 –
Robert Neil Coombe 170 272 442 –
Dato’ Mohamed Ross Mohd Din 170 385 555 –
Dato’ Lee Kok Kwan 170 120 290 –
Ahmad Zulqarnain Che On 170 165 335 –
Afzal bin Abdul Rahim – – – –
(appointed on 31 January 2019)
Didi Syafruddin Yahya 111 95 206 –
(appointed on 7 May 2019)
Tongurai Limpiti 111 60 171 –
(appointed on 7 May 2019; resigned on
30 December 2019)
Glenn Muhammad Surya Yusuf 11 16 27 –
(resigned on 23 January 2019)
Watanan Petersik 11 10 21 –
(resigned on 24 January 2019)

Executive Directors
Tengku Dato’ Sri Zafrul Tengku Abdul Aziz – – – –

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CIMB Group

Salary and/
or Other
Fees Remuneration Total Benefits-in-kind
Directors (RM’000) (RM’000) (RM’000) (RM’000)

Non-Executive Directors
Datuk Mohd Nasir Ahmad 325 1,145 1,470 35
Teoh Su Yin 170 355 525 –
Robert Neil Coombe 170 272 442 –
Dato’ Mohamed Ross Mohd Din 310 708 1,018 31
Dato’ Lee Kok Kwan 333 245 578 –
Ahmad Zulqarnain Che On 170 165 335 –
Afzal bin Abdul Rahim – – – –
(appointed on 31 January 2019)
Didi Syafruddin Yahya 326 215 541 –
(appointed on 7 May 2019)
Tongurai Limpiti 111 60 171 –
(appointed on 7 May 2019; resigned on
30 December 2019)
Glenn Muhammad Surya Yusuf 566 16 582 –
(resigned on 23 January 2019)
Watanan Petersik 162 10 172 –
(resigned on 24 January 2019)

Executive Directors
Tengku Dato’ Sri Zafrul Tengku Abdul Aziz – 8,532 8,532 8

The Directors and Officers of CIMB are covered by Directors and Officers liability insurance for any liability incurred in the discharge of their
duties, provided that they have not acted fraudulently or dishonestly or derived any personal profit or advantage. The insurance premium
paid during the financial year amounted to RM1,018,690.

CIMB Group Remuneration Policy

The CIMB Group Remuneration Policy, which has been reviewed by the GNRC and approved by the Board, applies to all subsidiaries and
overseas offices within CIMB and acts as a guiding principle in relation to the design and management of CIMB’s remuneration
programmes. Three key principles of CIMB’s Remuneration Policy are as follows:

Principle Purpose Approach

Strong governance To ensure strong and independent oversight of • Oversight and review by GNRC
the remuneration system • Guided by input from control functions, AC and BRCC

Appropriate To support a performance-based culture which • Performance measurement through balanced

assessment of promotes prudent risk-taking and long-term scorecard which includes both financial and non-
performance sustainability financial goals, short-term and long-term perspectives
and incorporates measures related to risk,
compliance and process controls
• Use of risk-adjusted performance measures i.e.
risk-adjusted return on capital (RAROC) and
economic profit
• Deferral and claw back arrangements in variable
remuneration schemes

Market To offer rewards that allow CIMB to attract, • Benchmarking against similar organisations in the
competitiveness motivate and retain the right talent geographies and industries in which CIMB operate

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corporate governance overview statement

Components of Remuneration

Employee remuneration is composed of two main components – fixed and variable:

Component Composition Purpose and Approach

Fixed Consists of base salary and fixed allowances • Determined based on skills, competencies,
responsibilities and performance of the employee,
taking into consideration market competitive levels.

Variable Payable annually through cash bonus and shares • Purpose of motivating, rewarding and retaining high
(through participation in the Equity Ownership performing employees who generate shareholder
Plan, described below) value and contribute to the success of the Group.
• Performance-based and not guaranteed, reflecting
the individual employee’s performance, and business
unit or function performance as well as the Group’s
results.
• Portions of cash bonus may be subject to deferral.
• Based on a selection criterion, shares may be
awarded to employees through participation in the
Group’s Equity Ownership Plan, where the value of
award ranges from 20% to 60% of variable
remuneration.

The Equity Ownership Plan serves as the Group’s share-based The Group’s key measures are cascaded to the business units and
long-term incentive plan, with the intent of: enabler functions accordingly and subsequently to the KPI
scorecards of individuals. The RAROC measure has also been
• aligning the interests of key personnel to that of shareholders;
cascaded to the KPI scorecards of key individuals in the
• mitigating a short-term mindset and cultivating a focus towards organisation across the Group.
long-term sustainability; and
For each employee, performance is tracked through KPIs in a
• retaining key personnel with the Group.
balanced scorecard. In addition to financial targets, KPIs in the
balanced scorecard usually include measures on customer
Shares under the plan are released progressively to the participants
experience, long-term initiatives (where progress of milestones or
over three years.
ROI may be monitored), risk management and process controls,
audit and compliance findings, as well as people related measures.
Any deferred variable remuneration (cash bonus and/or EOP
At the end of the year, performance of each individual is then
shares) that has not been paid to or vested to the employee is
assessed through the Group’s performance management
subject to forfeiture or adjustment in the event of:
framework which is based on 70% of the balanced scorecard and
• Resignation or cessation of employment with the Group 30% of the individual’s proficiency in required competencies.

• Misconduct
Determination of Variable Remuneration
• Material restatement of financial results
Based on CIMB’s performance, the GNRC will determine the overall
variable remuneration pool taking into consideration key
Measurement of Performance
performance measures and ensuring that CIMB does not pay
The Group’s performance is determined in accordance with a variable remuneration at a level that would affect shareholders’
balanced scorecard which includes key measures on profitability, interest. The GNRC has the discretion to adjust the pool where
cost, capital, shareholders’ return, medium to long-term strategic required, based on performance, capital requirements, economic
initiatives, as well as risk, audit and compliance positions. CIMB conditions, competitive landscape and retention needs.
currently tracks two risk adjusted performance measures, RAROC
and economic profit, which are adopted in phases across the The Group pool will be allocated to the business units and functions
Group. based on their respective performance, measured through
balanced scorecards and guided by the Group CEO. The allocation
will also take into consideration inputs from the control functions
such as Audit, Compliance and Risk.

112
Variable remuneration of each individual employee is then determined based on individual assessment and the adequacy of bonus pool
allocated to the business unit/function to which the individual belongs. Variable remuneration of the individual may also be adjusted based
on accountability of audit and compliance findings, or disciplinary action.

The control functions of Audit, Compliance and Risk operate independently from the business units in CIMB, and have appropriate authority
to carry out their individual functions without intervention from the business units. To prevent conflict of interest, remuneration of employees
in these control functions are not dictated by business units that they support. Remuneration of the Group Chief Risk Officer, Group Chief
Legal & Compliance Officer and the Group Chief Internal Auditor are approved by the BRCC and the AC.

SENIOR OFFICERS AND MATERIAL RISK TAKERS

Summary of 2019 Remuneration Outcome

Breakdown of remuneration awarded to Senior Officers and Material Risk Takers for 2019:

Senior Officers Material Risk Takers

Variable – Shares
20%
Variable – Shares Fixed – Cash
35% 39%

Fixed – Cash
54%

Variable – Cash
26%
Variable – Cash
26% Unrestricted: 94%
Unrestricted: 97% Deferred: 6%
Deferred: 3%

Senior Officers (SOs) of the Group are defined as the Group CEO, Group CFO Material Risk Takers (MRTs) are defined as employees whose responsibilities have
and members of the Group Executive Committee (GEXCO). a material impact on the Group’s performance and risk profile, and employees
whose responsibilities require them to take on material risk exposures on behalf
Total remuneration awarded to 18 SOs for the financial year 2019 was RM96.5 of the Group.
million.
Total remuneration awarded to 44 MRTs for the financial year 2019 was RM109.9
million.

Table 1: Guaranteed bonuses, sign-on bonuses and severance payments

SOs MRTs
Category (RM’000) (RM’000)

Number of guaranteed bonuses – –

Number of sign-on bonuses 3 2
Number of severance payments – –

Total amount of above payments made during the financial year 2019 9,315 408

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corporate governance overview statement

Table 2: Breakdown of deferred remuneration

SOs MRTs
Category (RM’000) (RM’000)

Total amount of outstanding deferred remuneration

• Cash 1,577 2,985
• Shares 76,036 55,072

Total amount of deferred remuneration paid out during the financial year
• Cash 8,879 7,755
• Shares 22,19 4 20,716

Outstanding deferred remuneration (performance adjustments):

• Of which exposed to ex-post adjustments 100% 100%
• Reductions in current year due to ex-post adjustments (explicit) – –
• Reductions in current year due to ex-post adjustments (implicit) – –

Outstanding retained remuneration (performance adjustments):

• Of which exposed to ex-post adjustments – –
• Reductions in current year due to ex-post adjustments (explicit) – –
• Reductions in current year due to ex-post adjustments (implicit) – –

Examples of explicit ex-post adjustments include malus, claw backs or similar reversals or downward revaluations of awards.
Examples of implicit ex-post adjustments include fluctuations in the value of shares or performance units.

Table 3: Breakdown of Group CEO’s remuneration

Cash Shares Total

Name Category (RM’000) (RM’000) (RM’000)

Tengku Dato’ Sri Zafrul Fixed remuneration 3,093 – 3,093

Tengku Abdul Aziz Variable remuneration
• Non-deferred 2,527 – 2,527
• Deferred – 2,912 2,912

Total remuneration award for financial

year 2019 5,620 2,912 8,532

PRINCIPLE B: E F F E C T I V E AU D I T A N D R I S K
M A N AG E M E N T

AUDIT COMMITTEE

The AC is chaired by Dato’ Mohamed Ross Mohd CIMB has in place a process to consider the appointment/
Din and the members are Teoh Su Yin and Datuk re-appointment of External Auditors, which is in line with BNM’s
Mohd Nasir Ahmad, all of whom are Independent Policy on External Auditors. The process requires the AC to assess
Directors. Members of the AC have the relevant accounting or the External Auditors’ compliance with qualification criteria set out
related financial management experience or expertise. The by BNM, which includes evaluating the independence, objectivity
Chairperson of the AC has over 40 years of relevant experience, and performance of the External Auditors.
and is not the Chairperson of the Board. This is to promote robust
and open deliberations by the Board on matters referred by the AC.

114
As part of its remit, the AC must ensure that the objectivity, The BRCC is responsible for formulating and reviewing the risk
independence and effectiveness of the External Auditors are management policies and risk appetite of CIMB. The BRCC also
maintained. As per the Board Charter, the AC will not appoint provides oversight and advice to the Board and Management in
former key audit partner as its member unless the former key respect of the management of compliance risk. The BRCC
partner has observed a cooling-off period of at least two years comprises seven members, of whom five members (including the
before being appointed as a member of the AC. Chairperson) are Independent Directors. The BRCC is chaired by
Robert Neil Coombe. Similarly, the AC reviews the effectiveness of
RISK MANAGEMENT AND INTERNAL CONTROL internal controls, risk management processes and governance
FRAMEWORK within the Group.

The Board is cognisant of its overall responsibility and oversight of

GCAD reports independently to CIMB’s AC and provides
CIMB’s system of internal controls and is constantly keeping
independent appraisal on the adequacy, efficiency and
abreast with developments in areas of risk and governance. To this
effectiveness of risk management, controls and governance
end, the Board continues to be involved in determining CIMB’s level
processes implemented by Management. The internal audit
of risk appetite and identifying, assessing and monitoring key risks
function is reviewed periodically by the AC to ensure its adequacy in
to safeguard Shareholders’ investments and CIMB’s assets, in a
performing its role. GCAD reports significant findings to the AC with
manner which enables CIMB to meet its strategic objectives. For
recommended corrective actions. Management is responsible to
this purpose, the Board has established governance and processes
ensure that corrective actions on reported weaknesses are
for reviewing the effectiveness, adequacy and integrity of CIMB’s
executed within an appropriate timeframe. The deadlines
system of internal controls and risk management. Whilst it is not
committed by Management on corrective actions are closely
possible to completely eliminate risks of failure in achieving CIMB’s
monitored and undue delays have to be justified to the AC for
objectives, the system of internal controls is designed to mitigate
approval.
these risks by identifying, managing and controlling risks, including
operational risk.
In addition, periodic external assessment of GCAD’s internal audit
activity is conducted by qualified external independent reviewer to
CIMB employs an Enterprise-Wide Risk Management (EWRM)
assess its conformance with The Institute of Internal Auditors
framework as a standardised approach to manage the risks and
International Standards for Professional Practice of Internal Auditing
opportunities effectively. The EWRM framework provides the Board
and the pertinent regulations.
and Senior Management with a tool to anticipate and manage both
existing and potential risks, taking into consideration changing risk
GCAD adopts the five components set out in the Internal Control
profiles as dictated by changes in business strategies, external
Integrated Framework issued by the Committee of Sponsoring
environment and/or regulatory environment.
Organisations of the Treadway Commission (COSO).

PRINCIPLE C: I N T E G R I T Y I N C O R P O R AT E R E P O R T I N G A N D M E A N I N G F U L R E L AT I O N S H I P
W I T H S TA K E H O L D E R S

COMMUNICATION WITH STAKEHOLDERS

CIMB is committed to having open, clear and timely communications with its stakeholders, both internally and externally.
In an effort to raise the level of corporate credibility and governance as well as investor confidence, CIMB has designed a
structured approach in its Group Strategic Communications Policy. This Policy clearly sets out the principles and various
channels of communication, policies and procedures relating to dissemination of information to the Shareholders, media and other
stakeholders.

It is CIMB’s policy to ensure information disseminated is factual, accurate, clear and in a timely manner. Material information should be
accessible by all stakeholders through broad public dissemination, as the Policy strictly prohibits individual or selective dissemination.
Contact and communication with stakeholders are conducted through the designated spokespersons approved by the Board or the Group
CEO.

CIMB embraces both mainstream and social media as important communication channels with stakeholders as these channels allow
immediate and easy access to information as well as provide a platform to gain feedback from the stakeholders. Apart from the mainstream
media channels, CIMB also uses various social media channels such as Facebook, Instagram, Twitter, LinkedIn and YouTube to engage
stakeholders and monitors these social media conversations to improve CIMB’s products and services.

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corporate governance overview statement

CONDUCT OF GENERAL MEETINGS The Board currently comprises nine Directors, of whom one is a
female, or 11% female representation. The Board remains
The Board ensures that Shareholders are given sufficient notice and
committed to achieve at least 30% female representation on the
time to consider the resolutions that will be discussed and decided
Board, whilst ensuring that diversity in skill set, experience, age and
at the AGM. The AGM Notice includes details of the resolutions
gender is met. The GNRC is currently considering new candidates
proposed, along with any relevant information and reports. CIMB
to be nominated to the Board and is mindful of this requirement.
held its 62nd AGM on 22 April 2019 with the Notice and Agenda of
the AGM delivered to the Shareholders on 22 March 2019, this
30% of female participation on the Boards is also observed on the
being 28 days before the meeting. The Notice and Agenda were
Boards of CIMB’s main subsidiaries. The subsidiaries that have
also published in the local English and Bahasa Malaysia
achieved more than 30% of female participation on the Board are
newspapers and made available on CIMB’s website at
CIMB Bank Berhad (40%), and CIMB Islamic Bank Berhad (33%).
[Link].
The CIMB Investment Bank Board is mindful of this requirement
and is currently reviewing its composition with the view to nominate
The 62nd AGM was attended by all Directors, Management and
more female candidates for the Board.
3,139 Shareholders. The Chairperson, who chaired the
proceedings, provided fair opportunity and time to all Shareholders
PRACTICE 7.2
to exercise their rights to raise questions and make
recommendations. The proceedings of the 62nd AGM were The Board has decided not to disclose, on a named basis, the top
recorded in the minutes of the meeting and made available within five senior management’s remuneration components including
two weeks after the meeting on CIMB’s website at [Link]. salary, bonus, benefits in-kind and other emoluments in bands of
RM50,000. The Board believes that disclosure of key executives’
CIMB has leveraged technology to facilitate greater shareholders’ remuneration is neither to CIMB’s advantage nor in its business
participation and enhance the proceedings of General Meetings. interests, given the sensitive nature of such information and the
Resolutions during the 62nd AGM were arrived at via e-polling to fierce competition for talent in the banking industry.
enable all Shareholders to cast their votes. A Poll Administrator was
appointed to conduct the e-polling process. Across the Group, CIMB currently discloses the remuneration of the
top four management positions in their respective financial
SUMMARY statements, as follows:

The Board considers that CIMB has complied and applied the 1. CEO, CIMB Group Holdings Berhad*
Principles of the MCCG in 2019, except for the following:
2. CEO, CIMB Bank Berhad*
• Practice 4.5 (The Board must have at least 30% women
3. CEO, CIMB Investment Bank Berhad
Directors)
4. CEO, CIMB Islamic Bank Berhad
• Practice 7.2 (The remuneration of Top-5 Key Senior
Management) * Positions 1 and 2 are held by the same individual
• Practice 12.3 (To facilitate voting in absentia)
PRACTICE 12.3
The Board has identified those Practices where there is a departure CIMB has yet to facilitate voting in absentia and remote participation
and these departures will be addressed as follows: by Shareholders at General Meetings. In 2018, CIMB continues to
• An explanation for the departure; leverage technology and adopt e-polling as the preferred medium
for Shareholders to cast their votes. CIMB will continue to explore
• Disclosure of alternative practice adopted and how the and consider the recommendations in the MCCG on the use of
alternative practice achieves the Intended Outcome; technology for remote Shareholders’ participation and voting in
• Actions which CIMB has taken or intends to take; and absentia by FYE 2020.

• The timeframe required to achieve application of the prescribed

Practice.
This Corporate Governance Overview Statement is made in
PRACTICE 4.5 accordance with the resolution of the Board dated 21 February
The GNRC oversees the overall composition of the Boards and 2020.
Board Committees in terms of the appropriate size, skills, gender
diversity and the balance between Independent Directors, Non- For further information on the application of the practices
Independent Directors and Executive Directors through annual encapsulated in the Principles of MCCG during the financial year,
reviews. please refer to the Corporate Governance Report which can be
found in [Link] under [Link]
investor-relations/reports-and- presentations/annual-reports.
html#read/

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 additional
(As at 31 December 2019 pursuant to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad)

1. U T I L I S AT I O N O F P R O C E E D S R A I S E D F R O M C O R P O R AT E P R O P O S A L S

During the financial year ended 31 December 2019, the Group has (G) USD40 MILLION BONDS
collectively issued the following instruments:
On 15 November 2019, CIMB Bank issued USD40 million
3-year floating rate notes under its USD5.0 billion Euro
(A) USD88 MILLION BONDS
Medium Term Note Programme established on 15 August
On 19 March 2019, CIMB Bank issued USD88 million 5-year 2014. The Notes, which bear a coupon rate of USD 3-months
floating rate notes under its USD5.0 billion Euro Medium Term LIBOR + 0.58% per annum payable quarterly, will mature on
Note Programme established on 15 August 2014. The Notes, the interest payment date falling in or nearest to 15 November
which bear a coupon rate of USD 3-months LIBOR + 0.85% 2022.
per annum payable quarterly, will mature on 19 March 2024.
(H) IDR2,000,000 MILLION SUKUK
(B) HKD700 MILLION BONDS
On 21 August 2019, CIMB Niaga issued IDR2,000,000 million
On 4 April 2019, CIMB Bank, acting through its Hong Kong Sukuk. The Sukuk is divided into 3 series. Nominal value of
branch, issued HKD700 million 1-year fixed rate notes under 1-year Series A Sukuk, 3-year Series B Sukuk, and 5-year
its USD5.0 billion Euro Medium Term Note Programme Series C Sukuk amounted to IDR635,000 million, IDR936,000
established on 15 August 2014. The Notes, which bear a million, and IDR429,000 million respectively, with fixed interest
coupon rate of 1.98% per annum payable annually, will mature rate of 7.10%, 7.90% and 8.25% per annum respectively.
on 4 April 2020 (subject to adjustment in accordance with the
modified following business day convention). (I) IDR1,823,000 MILLION BONDS

On 19 December 2019, CIMB Niaga issued IDR1,823,000

(C) USD30 MILLION BONDS
million bonds. The bonds are divided into 3 series. Nominal
On 15 April 2019, CIMB Bank, acting through its Labuan value of 1-year Series A Bond, 3-year Series B Bond, and
Offshore Branch, issued USD30 million 5-year floating rate 5-year Series C Bond amounted to IDR276,000 million,
notes under its USD5.0 billion Euro Medium Term Note IDR1,066,000 million, and IDR481,000 million respectively,
Programme established on 15 August 2014. The Notes, which with fixed interest rate of 6.50%, 7.55% and 7.80% per annum
bear a coupon rate of USD 3-months LIBOR + 0.80% per respectively.
annum payable quarterly, will mature on 15 April 2024 (subject
to adjustment in accordance with the modified following (J) IDR83,000 MILLION NOTES
business day convention).
On 19 December 2019, CIMB Niaga issued IDR83,000 million
bonds with fixed interest rate of 8.05% per annum and
(D) HKD200 MILLION BONDS
maturity date of 19 December 2024.
On 12 July 2019, CIMB Bank issued HKD200 million of a
5-year fixed rate notes under its USD5.0 billion Euro Medium (K) SUBORDINATED DEBTS 2019/2029 USD15 MILLION
Term Note Programme established on 15 August 2014. The
On 15 May 2019, CIMB Bank PLC issued USD15 million
Notes, which bear a coupon rate of 2.35% per annum payable
subordinated loan which qualified as Tier 2 capital for CIMB
annually in arrears, will mature on 12 July 2024.
Bank PLC for the purpose of computation of minimum
Solvency Requirements by the National Bank of Cambodia
(E) USD20 MILLION BONDS
(“NBC”). The subordinated loan was issued as a single tranche
On 8 August 2019, CIMB Bank issued USD20 million 5-year at a fixed rate of 4.5% per annum with a maturity of 10 years
floating rate notes under its USD5.0 billion Euro Medium Term from the issue date with a call option starting at the end of
Note Programme established on 15 August 2014. The Notes, year 5 and on each relevant coupon payment date thereafter.
which bear a coupon rate of USD 3-months LIBOR + 0.73% The redemption of the subordinated loan will be subject to
per annum payable quarterly, will mature on 8 August 2024. NBC's approval. The subordinated loan was subscribed by
CIMB Bank.
(F) USD680 MILLION BONDS

On 9 October 2019, CIMB Bank issued USD680 million 5-year

floating rate notes under its USD5.0 billion Euro Medium Term
Note Programme established on 15 August 2014. The Notes,
which bear a coupon rate of USD 3-months LIBOR + 0.78%
per annum payable quarterly, will mature on the interest
payment date falling in or nearest to 9 October 2024.

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additional disclosures

(L) SUBORDINATED LOANS 2019/2024 RM1.0 BILLION (Q) COMMERCIAL PAPERS RM550 MILLION

On 28 June 2019, the Company issued RM1.0 billion Basel On 10 May 2019, the Company issued RM550 million 3-month
III-compliant Additional Tier 1 Capital Securities under the CPs under its Convertional Commercial Papers Programme.
RM10 billion Basel III AT1 Programme, at 4.88% per annum The CPs bear a discount rate of 3.76%. The Company
with an Issuer's call option to redeem at the end of year 5 and redeemed the RM550 million Conventional CPs on 9 August
on each coupon payment date thereafter, subject to approval 2019.
from BNM.
(R) MEDIUM TERM NOTES (“MTN”) RM250 MILLION AND
(M) SUBORDINATED NOTES 2019/2029 RM550 MILLION ISLAMIC MEDIUM TERM NOTES (“IMTN”) RM750
MILLION
On 8 July 2019, CIMB Thai issued RM550 million Basel III
compliant Tier 2 subordinated notes. The subordinated notes On 12 June 2019, the Company issued RM250 million 1-year
carry fixed interest rate of 4.15% per annum payable every six MTN which will mature on 12 June 2020 and RM750 million
months. The subordinated notes will mature on 6 July 2029. 3-year iMTN which will mature on 10 June 2022. The MTN and
CIMB Thai may exercise its right to early redeem the iMTN carry interest rate of 3.80% and 3.95% per annum
subordinated notes 5 years after issue date, and on each respectively, payable semi-annually in arrears.
coupon payment date thereafter, subject to approval by the
Bank of Thailand (“BOT”).
2 . S H A R E S B U Y- B AC K
(N) SUBORDINATED SUKUK 2019/2029 RM800 MILLION
During the financial year, the Company did not buy back any of its
On 25 September 2019, CIMB Islamic issued RM800 million issued share capital from the open market.
10 years non-callable 5 years Tier-2 Junior Sukuk at 3.75%
per annum, which was fully subscribed by CIMB Bank.
3 . O P T I O N S , WA R R A N T S O R C O N V E R T I B L E
SECURITIES
(O) SUBORDINATED LOANS 2019/2029 USD15 MILLION

On 25 September 2019, CIMB Bank PLC issued a USD15 There were no options, warrants or convertible securities issued
million subordinated loans which qualified as Tier 2 capital for during the financial year by the Group.
CIMB Bank PLC for the purpose of computation of minimum
Solvency Requirements by the National Bank of Cambodia
4. A
 M E R I CA N D E P O S I T O RY R E C E I P T ( A D R ) O R
("NBC"). The subordinated loan was issued as a single tranche
G L O B A L D E P O S I T O RY R E C E I P T ( G D R )
at a fixed rate of 4.0% per annum, with a maturity of 10 years
from the issue date with a call option starting at the end of
The Group did not sponsor any ADR or GDR programme during the
year 5 and on each relevant coupon payment date thereafter.
financial year under review.
The redemption of the subordinated loan will be subject to
NBC’s approval. The subordinated loan was subscribed by
CIMB Bank.

(P) SUBORDINATED DEBTS 2019/2029 RM800 MILLION

On 25 November 2019, the Company issued RM800 million

10 years non-callable 5 years Tier 2 Subordinated debts
bearing a fixed rate coupon of 3.85% per annum, payable on a
semi-annual basis. The said subordinated debt was issued
out of the RM10.0 billion Tier 2 subordinated debt programme.
The proceeds from the issuance were used to subscribe to
the RM800 million Tier 2 subordinated notes issued by CIMB
Bank on the same day, based on similar terms.

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 5 . I M P O S I T I O N O F S A N C T I O N A N D/O R P E N A LT I E S

CIMB Bank Berhad and CIMB Islamic Bank Berhad were imposed with regulatory fines with regard to secrecy breaches and these were
publicly disclosed in BNM’s website. See the link below:
[Link]

The breaches were considered material where the wrong Quarterly Savings Account e-Statements were sent to 11,071 unintended recipients
and e-Notices to 131 unintended recipients respectively. This has led to the disclosure of customer’s information to third parties. The details
of the regulatory fines were as follows:

No. Date of Institution Provision Nature of Action Taken Remarks Publication

Action Contravened Offence Notice/Press
Taken Release
1. 22/02/2019 CIMB Bank • S. 133(1) of • Disclosure of • Compound • The institutions [Link]
17/05/2019 Berhad Financial customer – RM6,400,000 had taken [Link]/index.
Services Act information to • Administrative remedial steps php?rp=ea%20
2013 (FSA) third party Monetary to ensure the cimb
• S. 48(1)(a) of • Failure to Penalty safety of
FSA read comply with – RM3,400,000 customer
together with the standards information.
Management of issued by the
Customer Bank
Information and
Permitted
Disclosures
Policy Document
2. 22/02/2019 CIMB Islamic • S. 145(1) read • Disclosure of • Compound • The institutions [Link]
17/05/2019 Bank Berhad together with S. customer – RM3,200,000 had taken [Link]/index.
261 of the information to • Administrative remedial steps php?rp=ea%20
Islamic Financial third party Monetary to ensure the cimb
Services Act • Failure to Penalty safety of
(IFSA) comply with – RM1,700,000 customer
• S.58(1)(a) of standards information.
IFSA read issued by the
together with the Bank
Management of
Customer
Information and
Permitted
Disclosures
Policy Document

6 . N O N - AU D I T F E E S 9. R
 E VA L UAT I O N P O L I CY O N L A N D E D
PROPERTIES
Non-audit fees payable to the External Auditors, Messrs.
PricewaterhouseCoopers PLT and its affiliates amounted to Please refer to the accounting policy on Property, Plant and
RM2,526,000 for the Group and RM57,000 for the Company. Equipment in Notes K, L and N of the Summary of Significant Group
Accounting Policies in the Financial Statements which are set out in
the Financial Statements section of the Annual Report.
7. VA R I AT I O N I N R E S U LT S

There were no material variations in results for the financial year 10 . M AT E R I A L C O N T R AC T S

ended 31 December 2019 from the unaudited results released on
28 February 2020. There were no material contracts entered into by CIMB Group and its
subsidiaries involving Directors’ and major shareholders’ interest
which were still subsisting as at the end of the financial year under
8 . P R O F I T G UA R A N T E E
review or which were entered into since the end of the previous
financial year except as disclosed in Notes 53 to the Financial
The Group did not receive any profit guarantee during the financial
Statements which are in the Financial Statements section of the
year ended 31 December 2019.
Annual Report.

119
statement on

B OA R D R E S P O N S I B I L I T Y The Group Chief Executive Officer (Group CEO) and Group Chief
Financial Officer have provided assurance to the Board that the
The Board affirms its commitment on its overall responsibility and Group’s risk management and internal control systems are
oversight of CIMB Group’s system of internal control and risk operating adequately and effectively.
management, and is constantly keeping abreast with developments
in areas of risk and governance. To this end, the Board is assisted
KEY INTERNAL CONTROL PROCESSES
by the Board Risk & Compliance Committee and the Audit
Committee, which have been delegated with primary oversight
The key processes that the Board has established in reviewing the
responsibilities on the Group’s risk management and internal
adequacy and integrity of the system of internal control, including
control systems. The Board remains responsible for the governance
compliance with applicable laws, regulations, rules, directives and
of risk and internal control, and for all the actions of the Board
guidelines, are as follows:
Committees with regard to the execution of the delegated oversight
responsibilities. • INTERNAL AUDIT

The Group Corporate Assurance Division (GCAD), formerly

In discharging its responsibilities, the Board continues to be
known as Group Internal Audit Division (GIAD), reports
involved in determining the Group’s level of risk appetite and in
independently to the CIMB Group Audit Committee and the
identifying, assessing and monitoring key business risks to
Banking Group Audit Committee and is independent of the
safeguard shareholders’ investments and the Group’s assets, in a
activities and operations of the business and other support
manner which enables the Group to achieve its business goals and
units. The principal responsibility of GCAD is to provide
objectives amidst the dynamic and challenging business
independent appraisal on the adequacy, efficiency and
environment. For this purpose, the Board has ensured the
effectiveness of risk management, control and governance
establishment of key processes for reviewing the effectiveness,
processes implemented by Management. In evaluating internal
adequacy and integrity of the Group’s system of internal control and
controls, GCAD adopts the 5 components set out in the Internal
risk management.
Control Integrated Framework issued by the Committee of
Sponsoring Organisations of the Treadway Commission
The risk management and internal control systems are designed to
(COSO); namely control environment, risk assessment, control
manage risk exposures within the risk appetite set by the Board to
activities, information and communication, and monitoring
achieve the Group’s business objectives. The systems provide
activities. COSO is an internationally recognised organisation
reasonable assurance against the occurrence of any material
providing thought leadership and guidance on internal control,
misstatement, loss or fraud.
enterprise risk management and fraud deterrence.
In addition, regular testing on the adequacy, effectiveness, efficiency
GCAD’s scope of coverage encompasses all business and
and integrity of the internal control systems and processes is
support units, including subsidiaries that do not have their own
conducted to ensure its viability and robustness.
audit units. The selection of the units to be audited from the
audit universe is based on an annual audit plan that is approved
M A N AG E M E N T R E S P O N S I B I L I T Y by CIMB Group Audit Committee and the Banking Group Audit
Committee. The annual audit plan is developed based on
Management is accountable to the Board and is overall responsible assessment of risks, exposures and strategies of CIMB Group.
for the effective implementation of the Board’s policies and Areas that are assessed to be high risk are subject to an annual
procedures on risks and controls. Its responsibilities in respect of audit, while those that are assessed to be medium or low risk
risk management and internal control include: are subject to a cycle audit. Notwithstanding the risk
assessment, the annual audit plan will include areas that must
• Identifying, and evaluating the risks faced by the Group, and the
be audited annually due to regulatory requirements, and other
achievement of business objectives and strategies;
established criteria such as recent incidence of fraud, previous
• Formulating relevant policies and procedures to manage these adverse audit rating or recent action by regulators. GCAD also
risks in accordance with the Group’s strategic vision and overall undertakes investigations into suspected fraudulent activities,
risk appetite; staff misconduct, whistleblowing cases, potential secrecy
breach, and other incidences, as and when required, and
• Designing, implementing and monitoring the implementation of
recommends appropriate improvements to prevent recurrence
risk management framework and internal control system;
and actions against persons responsible.
• Implementing policies approved by the Board;
GCAD has unrestricted access to information required in the
• Implementing remedial actions to address compliance
course of its work. GCAD’s scope of work is established in
deficiencies as directed by the Board; and
accordance with The Institute of International Auditors’ (IIA)
• Reporting in a timely manner to the Board on any changes to International Standards for the Professional Practice of Internal
the risks and the corrective actions taken. Auditing and relevant regulatory guidelines.

120
 The Audit Report is the final product of an audit assignment, The Banking Group AC comprised of four independent
which provides the scope of audit work performed, a general Non-Executive Directors and one Non-Independent Non-
evaluation of the system of internal control together with Executive Director. The responsibility of the Banking Group AC
detailed audit observations, management responses, and is limited to CIMB Bank, CIMB Islamic Bank and CIMB
timeline to implement GCAD’s recommendations. CIMB Group Investment Bank and their subsidiaries. Senior Management,
Audit Committee or Banking Group Audit Committee (as internal auditors and external auditors report to CIMB Group AC
appropriate) reviews any exceptions or non-compliance raised and the Banking Group AC (as appropriate) on the effectiveness
and ascertains that appropriate and prompt remedial actions and efficiency of internal controls.
are taken by the management.
All significant and material findings by the internal auditors,
GCAD conducts training routinely for relevant staff on external auditors and regulators are reported to CIMB Group
governance and internal control matters from other divisions, AC and the Banking Group AC (as appropriate) for review and
including attachment of certain staff with GCAD for both deliberation. CIMB Group AC and the Banking Group AC (as
classroom and on-the-job training. appropriate) review and ascertain that mitigation plans are
implemented by senior management to safeguard the interests
The foreign banking subsidiaries have their own Audit of CIMB Group and upkeep proper governance. Management
Committees and their own internal audit divisions. While Touch of business and support units that are rated adversely by
‘n Go also has its own Audit Committee, the internal audit internal audit are counselled by the respective AC.
function for this subsidiary is carried out by GCAD. CIMB Group
Audit Committee meets with the relevant subsidiary’s Audit CIMB Group AC also reviews all related party transactions, and
Committee once a year to discuss governance and audit audit and non-audit related fees proposed by the external
matters. The internal audit divisions of the foreign banking auditors of CIMB Group.
subsidiaries submit a report to CIMB Group Audit Committee
once every quarter. These internal audit divisions follow the Presentations of business plans, current developments,
same audit planning and standards, and same audit rating operations, risks of the business and controls to mitigate risks
methodology as GCAD with such modifications as necessary to are made by the relevant business and support units as and
suit local environment and regulations. when deemed necessary by CIMB Group AC or the Banking
Group AC.
As a means to objectively evaluate its service quality and to
ensure it continues to improve its service delivery, GCAD has CIMB Group AC and the Banking Group AC members are
obtained ISO 9001:2015 Certification for its quality management invited to attend CIMB Group’s Annual Management Summit
system. In addition, external assessment of GCAD’s internal where key business and support divisions review their
audit activity is conducted by qualified external independent operations for the year, present and discuss strategies and
reviewer at least once every five years to assess its plans for the coming year.
conformance with The Institute of Internal Auditors (IIA)
International Standards for Professional Practice of Internal • RISK MANAGEMENT AND CONTROL FRAMEWORK
Auditing and the pertinent regulations. The report for the last
The Board recognises that sound risk management and internal
assessment was issued in 2018 by a top 3 accounting firm in
control are integral parts of CIMB Group’s business, operations
Malaysia and the next assessment will be undertaken by 2023.
and decision-making, and are critical in ensuring CIMB Group’s
success and sustainable growth.
• AUDIT COMMITTEE (AC)

CIMB Group AC comprises three independent Non-Executive The emphasis on a strong risk management culture is the
Directors. It is a Board-delegated committee charged with foundation of the control mechanisms within CIMB Group’s
oversight of financial reporting, disclosure, regulatory Enterprise-Wide Risk Management (EWRM) framework. The
compliance, risk management, governance practices and framework consists of an on-going process of identifying and
monitoring of internal control processes in CIMB Group. CIMB assessing, measuring, managing and controlling, as well as
Group AC leverages on the work of the Banking Group AC and monitoring and reporting material risks affecting the
the respective Audit Committee of the foreign banking achievement of CIMB Group’s strategic business objectives. It
subsidiaries, and CIMB Group’s electronic collection system provides the Board and its management with tools to anticipate
subsidiary, Touch ‘n Go. and manage both the existing and potential risks, taking into
consideration the changing risk profiles as dictated by changes
in business strategies, the external environment and/or
regulatory environment.

121
statement on risk management and internal control

To further enhance the cultivation of the risk management • The GRCC supervises the periodic group-wide stress
culture, CIMB Group employs the Three Lines of Defence model testing exercises by endorsing appropriate scenarios based
in implementing the EWRM framework, providing risk on projected macroeconomic conditions and
management accountability across the CIMB Group. The recommending the results of the Stress Test exercise for the
business units, as the first lines of defence, are primarily BRCC’s approval.
responsible for the identification and management of risks
• The GRCC is also responsible for recommending CIMB
within their day-to-day operations. Group Risk and other control
Group’s Risk Appetite Statement to the BRCC taking into
functions within the second line of defence provide oversight
consideration the budget, annual business plans and
and perform independent monitoring of business activities with
expected macroeconomic conditions. In implementing the
reporting to the Board and management to ensure that CIMB
Risk Appetite Statement across CIMB Group, GRCC,
Group conducts business and operates within the approved
supported by CIMB Group Risk, encourages the timely
risk appetite, and is in compliance with regulations. Group
escalation of all events (including non-compliances and
Corporate Assurance Division, as the third line of defence,
deficiencies) which may materially impact the Group’s
provides independent assurance of the adequacy and
financial condition or reputation to the attention of GRCC for
effectiveness of the internal controls and risk management
appropriate action.
processes. The Board has also established the Board Risk &
Compliance Committee, whose responsibilities, amongst • The GRCC is further supported by specialised risk
others, include overseeing the effective implementation of the committees, namely Group Credit Committee; Group
EWRM framework. Market Risk Committee; Group Operational Risk and
Resiliency Committee; Group Asset Liability Management
• BOARD RISK AND COMPLIANCE COMMITTEE Committee; and Group Asset Quality Committee, with each
committee providing oversight and responsibility for specific
At the apex of the governance structure are the respective
risk areas, namely credit risk, market risk, non-financial risk,
Boards, which decide on the entity’s risk appetite
reputation risk, liquidity risk and capital risk.
corresponding to its business strategies. In accordance with
CIMB Group’s risk management structure, the Board Risk & • Similar risk committee’s are established in each of CIMB
Compliance Committee (BRCC) reports directly to the Group’s overseas subsidiaries in their respective
respective Boards and assumes responsibility on behalf of the jurisdictions. Whilst recognising the autonomy of the local
Boards for the supervision of risk management and control jurisdiction and compliance to local requirements, CIMB
activities, as well as non-compliances and deficiencies. The Group also strives to ensure a consistent and standardised
BRCC determines CIMB Group’s risk strategies and policies, approach in its risk governance process. As such, the
keeping them aligned with the principles within the risk appetite. relevant Group and Regional committees have consultative
The BRCC also oversees the implementation of the EWRM and advisory responsibilities on regional matters across
framework and provides strategic guidance and reviews the CIMB Group as regulators allow. This structure increases
decisions of CIMB Group Risk and Compliance Committee. the regional communication, sharing of technical knowledge
and support towards managing and responding to risk
In order to facilitate the effective implementation of the EWRM management issues, thus allowing the Board to have a
framework, the BRCC has established various specialised/ comprehensive view of the activities across CIMB Group.
sub-risk risk committees within CIMB Group with distinct lines
of responsibilities and functions, which are clearly defined in • COMPLIANCE FRAMEWORK
terms of reference.
The Board recognises that the Compliance function forms an
integral part of CIMB Group’s risk management and internal
• GROUP RISK AND COMPLIANCE COMMITTEE
control framework, and that a strong compliance culture reflects
• The Group Risk and Compliance Committee (GRCC) which a corporate culture of high integrity and ethics.
reports to the BRCC, performs the oversight function on
overall risks undertaken by CIMB Group in delivering its CIMB Group Legal & Compliance Division (GLC), reports
business plan vis-à-vis the stated risk appetite of CIMB independently to the Board. Appropriate governance has also
Group. In this regard, the GRCC reviews the Internal Capital been established with clear reporting lines by the local and
Adequacy Assessment Process annually to ensure that all regional compliance officers to CIMB Group Chief Legal &
relevant risks have been identified and captured, and that Compliance Officer and the respective local entity Boards, to
CIMB Group has sufficient capital resources to undertake the extent permitted by the regulations of the local jurisdictions.
such risks in either normal or stressed business conditions.

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 GLC’s responsibilities include identifying, assessing and • ANTI-MONEY LAUNDERING/ COUNTER FINANCING OF
monitoring the compliance risk associated with the business TERRORISM
and support units or entities; and advise the Board,
CIMB Group is committed to enforce an effective internal
Management and officers of the business and support units or
control system for Anti-Money Laundering/ Counter Financing
entities on relevant laws and regulations. All business and
of Terrorism (AML/CFT) in compliance with all related laws,
support units or entities must act in accordance with relevant
regulations, guidelines and industry leading practices including
laws, regulations and internal GLC policies and procedures.
in the jurisdictions that it operates.
Under the Three Lines of Defence Model, all business and
support units or entities as the first line of defence, are required
CIMB Group continues to strengthen its enterprise wide
to review, assess and establish the necessary control to ensure
AML/CFT program through a risk based approach to ensure
compliance to applicable laws and regulations. The entities or
that the key measures emplaced to prevent and mitigate money
units are required to carry out periodic self-assessment on the
laundering and terrorist financing commensurate with the
adequacy of control and level of adherence to regulatory
business and compliance risks that have been identified and
requirements. GLC will also conduct compliance reviews on
assessed. The AML/CFT program also provides guidance to all
business and support units/entities as part of the second line of
CIMB employees, requiring them to conduct business in
defence assurance that regulatory requirements are in place.
accordance with applicable AML/CFT laws, rules and
GLC has unrestricted access to all information, records and
regulations.
business premises of CIMB Group and has the authorisation to
speak to any employee of CIMB Group about any conduct,
CIMB Group as a responsible member of the international
business practice, ethical matter or other issue relevant to
financial community complies with all sanctions laws and
discharging GLC’s duties.
regulations administered and enforced by the Malaysia
Government and other regulators in the jurisdictions in which it
The respective entity Boards, as well as the CIMB Group Board,
operates and has dealings, including the sanctions practices
are provided with compliance reports on a regular basis the
adopted by its Agent/Correspondent Banks. CIMB Group has
findings and analysis of compliance risk including compliance
established its own Sanction program to comply with its
risk assessment, incidences of non-compliance and
obligations including screening of customers and transaction
deficiencies, corrective measures and information to facilitate
against the list issued to prevent dealings with sanctioned
the Boards having a holistic and overall view of all compliance
parties, conducting due diligence of a customer at on-boarding,
matters across CIMB Group.
transaction and on periodic basis, blocking and rejecting
transactions for those that hit the list and forbidding and limiting
GLC’s scope of coverage encompasses all business and
business activities restricted under its Sanction program.
support units including subsidiaries in Malaysia as well as
outside of Malaysia including activities which are carried out by
The Group undertakes ongoing compliance review on its
CIMB Group or on behalf of CIMB Group by third parties.
products, conduct and services provided to customers and
continues to enhance its AML program to address areas
As it is vital to have a robust and effective compliance
requiring enhancement and/or implement risk mitigating factors.
framework in place to safeguard the interest of CIMB Group,
stakeholders, customers/clients and employees, CIMB Group
• SHARIAH RISK MANAGEMENT
has in place compliance policies/standards with appropriate
mechanisms and tools are driven at CIMB Group level to ensure Under the EWRM Framework, Shariah non-compliance (SNC)
consistency in managing compliance risk within CIMB Group. risk is identified as one of the material risks for CIMB Group,
GLC requires all local and regional entities within CIMB Group specifically in relation to its Islamic banking business. The SNC
to adopt and implement all GLC Compliance policies and risk is defined as CIMB Group’s possible failure to comply with
procedures, which are reviewed on a periodic basis or as and Shariah requirements as determined by the relevant Shariah
when required to reflect current practices and the applicable Committees and as prescribed in CIMB Group’s internal
legal/regulatory requirements. Trainings are conducted regularly policies and procedures.
to create compliance awareness and to facilitate its
implementation of laws, regulations and internal GLC The Shariah Risk Management Procedure has been developed
compliance policies within CIMB Group. to supplement Shariah Risk Management Policy in providing
better understanding of SNC risk and to provide guidance and
consistent approach to facilitate Business Units (BUs)/ Business
Enablers (BEs) in managing SNC risk inherent in Islamic banking
business.

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statement on risk management and internal control

In order to facilitate BUs/BEs in identifying inherent SNC risk in In ensuring that the activities and operations of CIMB Group are
their areas adequately, the standard SNC risk description and Shariah-compliant, SRA CoE conducts post review of CIMB
Key Risk Indicator (KRI) related to SNC risk have been Group’s activities and operations in accordance with the annual
developed. BUs/BEs are required to capture relevant SNC risk Shariah review work plan approved by the BSC and the
in their Risk and Control Self-Assessment (RCSA) for mitigation respective Boards of Directors of CIMB Group (“the Board”). In
and monitoring purposes. addition, SRA CoE conducts investigation on issues escalated
by the stakeholders including from Shariah Audit and the
In addition, to expedite the escalation of SNC event to the business units to determine potential Shariah non-compliance
Management and streamline the reporting procedures between and performs ad-hoc review as required from time to time by
SNC risk event and operational risk event, the Group Impact the regulators, BSC or the Board.
Classification Matrix relating to SNC risk rating has been
revised. Among others, the potential SNC event as determined Trainings on the Shariah Review Policy & Procedures, Shariah
by Shariah Review will be rated as ‘High’ and must be escalated non-compliance reporting requirements, and all other relevant
to Group Risk and Compliance Committee (GRCC) within 24 BNM’s policy documents are continuously conducted to
hours. educate and raise awareness of CIMB Group’s staff on the
importance of complying with Shariah requirements.
• SHARIAH REVIEW
• SHARIAH AUDIT
The Shariah review function is carried out by Shariah Review &
Assurance Centre of Excellence (“SRA CoE”) of Islamic Banking Shariah audits of the Islamic banking business are under the
Compliance in line with the Bank Negara Malaysia (“BNM”)’s purview of Group Corporate Assurance Division (“GCAD”),
Shariah Governance Framework for Islamic Financial Institutions which reports independently to both the CIMB Group Audit
(“SGF”) 2011 and the Shariah Governance Policy Document Committee and Banking Group Audit Committee, as well as to
(“SGPD”) 2019. SRA CoE’s main role is to conduct regular end the Board Shariah Committee on audit matters relating to
to end assessment on the compliance of the operations, Islamic business operations and activities, particularly on
business, affairs and activities of CIMB Group with Shariah and Shariah compliance related matters. The principal objective is to
Islamic regulatory requirements. provide an independent assessment and assurance designed
to add value and improve the degree of compliance in relation
SRA CoE, as a second-line of defence function, reports to the Islamic banking business operations, as well as ascertain
independently into the Board Shariah Committee (“BSC”) of a sound and effective internal control system for Shariah
CIMB Islamic Bank Berhad (“CIMB Islamic”), and reports compliance.
functionally into the Chief Compliance Officer of CIMB Islamic,
forming part of the CIMB Group Compliance Division as The same audit methodology is implemented by GCAD in
envisaged by the SGPD. The SRA CoE is staffed by qualified carrying out Shariah audits as with non-Shariah audits, which
Shariah officers who are also qualified to undertake compliance includes audit planning, test of control, substantive procedures,
function responsibilities and possess sound understanding of reporting and follow-up on remedial actions. The scope of a
the relevant Shariah requirements. Shariah audit is established in line with the areas stipulated in
Bank Negara Malaysia’s Shariah Governance Framework.
The SRA CoE has established the CIMB Group Shariah Review
Policy and Procedures (“Shariah Review Policy & Procedures”), GCAD, in collaboration with Group Human Resource, made an
which sets out the policies for Shariah review function on the arrangement with a reputable Islamic banking association to
Islamic financial services, operations and activities of CIMB provide relevant Islamic banking certification to its auditors. The
Group, encompassing regular examination and evaluation of programme encompasses 3 stages, namely Associate
CIMB Group’s level of compliance to the Shariah requirements, Qualification in Islamic Finance (“AQIF”), Intermediate
remedial rectification measures to resolve non-compliances and Qualification in Islamic Finance (“IQIF”) and Certified
control mechanisms to avoid recurrences. In addition, the Qualification in Islamic (“CQIF”). There are 20 auditors who have
Shariah Review Procedures sets out the procedures for Shariah completed CQIF, 3 completed IQIF and another 2 completed
review execution, responsibilities of stakeholders and internal AQIF.
reporting process relating to Shariah non-compliance events, in
line with BNM’s requirements.

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• BOARD SHARIAH COMMITTEE • Advisory

The Board Shariah Committee (“BSC”) is responsible for Responsible for providing day-to-day Shariah advice and
overseeing overall Shariah matters of CIMB Group in consultation to the business and support units based on the
accordance with the relevant regulatory frameworks in the decision of the Shariah Committee.
jurisdictions where CIMB Group operates in. BSC, amongst
others, ensures that the Shariah rulings relating to Islamic Additionally, Advisory and Research unit is supported by the
banking and capital market products and services comply with Shariah Secretariat Unit which serves as the Secretariat to the
the fundamental Shariah precepts and resolutions by the BSC and the governance functions as well as the Shariah
relevant Shariah authorities. Learning & Development Unit that supports the training
function. The details of these support functions are described
BSC is assisted by the Shariah Advisory and Governance as follows:
department that functions as an internal adviser on Shariah
matters to all Islamic business within CIMB Group. It serves as • Secretariat
the intermediary between such units and the Shariah
Act as Shariah secretariat to BSC that includes coordinating
Committee. The Shariah Advisory & Governance department
meeting as well as communications and disseminating
also serves as the Secretariat to the Shariah Committee as well
information among the BSC, the board and senior
as providing Shariah related training across CIMB Group.
management; ensuring proper deliberation and
dissemination of decisions of the BSC to relevant
Policies and/or procedures from the respective Shariah organs
stakeholders; and undertaking administrative and secretarial
within the Group serves as a solid platform for all the processes
functions to support the BSC. In addition to that, the
under the Shariah Governance Framework (SGF) as required by
function is also responsible in engaging with relevant parties
Bank Negara Malaysia. The implementation of the SGF is
who wish to seek further deliberation of issues from the
effected through the following functions:
BSC.
a) Shariah Research;
The responsibility also includes coordinating submission of
b) Shariah Review;
proposals to CIMB Group Nomination and Remuneration
c) Shariah Risk Management; Committee, the respective Bank Boards and Bank Negara
Malaysia on the appointment and reappointment of the
d) Shariah Audit.
Shariah Committee members.
The Shariah Advisory and Governance department facilitates
• Governance
the implementation of Shariah Research and coordinates the
overall Shariah governance, whilst Shariah Review, Shariah Risk Responsible as coordinator for all Shariah organs namely
Management and Shariah Audit functions are performed by Shariah Advisory & Governance Department, Shariah
CIMB Group Legal & Compliance, Group Risk and Group Review CoE of Group Legal & Compliance, Shariah Risk
Corporate Assurance respectively. Management CoE of Group Risk and Shariah Audit of
Group Corporate Assurance in the management and overall
• SHARIAH RESEARCH oversight on the governance of Islamic business of CIMB
Group including without limitation the implementation of the
The Shariah Research function is undertaken by the Shariah
Shariah Governance and the review of structures,
Advisory & Governance department which comprises qualified
mechanism, techniques and process for the purpose of
Shariah officers who conduct the pre-product approval
end-to-end products development and other processes
process, advisory, research, vetting of issues for submission to
related to Islamic business of CIMB Group.
the Shariah Committee. This unit is divided into two functions:
• Research In carrying out the above roles and responsibilities, the
Shariah Advisory & Governance Department is guided by
Responsible for performing in-depth research and studies
Shariah Advisory and Board Shariah Committee Secretariat
on Shariah issues, preparing Shariah papers for all product
Policy and Procedures. All communication between CIMB
proposal to be submitted to the Shariah Committee for
Group and the BSC will be facilitated by this unit.
approval as well as reviewing documentation to ensure
consistency with Shariah requirements.

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statement on risk management and internal control

• Training Risk and Compliance Committee for implementation across

CIMB Group, where applicable. Operational procedures, on the
Responsible in developing and managing the Shariah
other hand, are approved by CIMB Group Policy & Procedure
Learning and Development function. In addition to that, the
Oversight Committee (GPOC) for implementation. The approved
function would assist the Group Learning and Development
policies and procedures are timely disseminated to
as well as regional teams to assess and review the existing
stakeholders. Reviews and updates are performed regularly on
training plans and to make recommendations as needed, to
approved policies and procedures with the intent to ensure
design the training requirement and to develop the training
continuous improvements in operational efficiency while taking
solutions.
into consideration the changing industry profile on regulatory
requirements, risks and internal control measures for mitigation,
• GROUP EXECUTIVE COMMITTEE
and new products and services.
The Group Executive Committee (“GEXCO”) assists the Group
CEO in providing management oversight over the CIMB Group • PERFORMANCE REVIEW
business on key operational matters. It reviews and makes
On an entity-specific basis, the Boards of CIMB and its major
decisions on key financial and strategic matters including
subsidiaries are regularly apprised of key financial and operating
capital and principal investments for CIMB Group Holdings
statistics, including legal and regulatory matters for deliberation
Berhad and its subsidiaries (“CIMB Group Entities”).
and where necessary, to instruct that prompt actions are taken
to resolve issues in a timely manner.
The GEXCO’s role in relation to the Strategic Risk Management
Framework (SMRF) includes:
With respect to reporting at a division-specific level, each core
• To review, approve and/or recommend all major and key division presents its respective performance report at the
strategic matters; monthly GEXCO meeting, where the report covers, amongst
others, monthly financial performance, new business proposals
• To be notified by the Business Unit on the extent of strategic
and listing of defaulted accounts. Each division is assessed
risk and the projected impact on expected earnings and
against the approved budgets and corporate objectives; and
capital; and
justification is provided for significant variances. Further, the
• To provide guidance and/ or endorse risk mitigation plans to GEXCO will discuss pertinent issues, strategy and corrective or
address strategic risk identified. improvement measures to be implemented, if required.

The GEXCO takes on the monitoring and performance • INFORMATION TECHNOLOGY RISKS
evaluation function. The GEXCO members are responsible to
Information technology is a critical component of the Forward23
ensure that the Group is well run and delivers the outcomes
strategy. In 2019, CIMB Group continued to enhance its
which have been set by the Group CEO.
Information technology space, including undertaking a large
programme of staff training, customer education and
The GEXCO monitors management actions with regard to
technology improvements, which aims to strengthen our
improvements to the control environment, to manage risk
technology risk management & resiliency capabilities. The cyber
events and compliance breaches tabled. In the event of a crisis,
security capabilities at CIMB has also been strengthened via the
the GEXCO will be activated as the Group Crisis Management
formation of a dedicated Cyber Security Defense Centre and
Committee.
Threat Monitoring & Intelligence unit.

The GEXCO members report to the Group CEO on the

Our Information technology and resiliency programs is based on
performance of their business divisions in line with the Group’s
regulatory guidelines and internationally recognised technology,
strategy and other matters as directed by the Board and Group
process and management standards. These standards include
CEO.
ISO 27001, which is an information security management
system standard defined by ISO and internationally accepted
• INTERNAL POLICIES AND PROCEDURES
best practice to demonstrate regulatory, compliance and
Policies set out principles, standards and/or rules that effective risk management on information security.
determine the expectation and boundaries for taking and
managing risks which are formulated to govern standard In line with the banking business growth and IT Infrastructure
day-to-day operations and to manage the expected risks of expansion, our technology design was regularly reviewed in
CIMB Group. As such, CIMB Group’s policies are developed 2019 and improved to support business growth in emerging
from the baseline of current regulatory requirements and areas, whilst effectively mitigating both internal and external
industry best practices to govern the business and operations risks.
of CIMB Group. The policies of the business and support units
are documented, endorsed by the GRCC or its sub-
committee(s) and approved by the relevant Boards or Board

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• CODE OF ETHICS The Future Of Work Centre (FOWC) has also been introduced
as part of the Group’s cumulative efforts aimed at equipping its
Further to the introduction in January 2017, the Bank has
workforce with essential skills and opportunities through the 3D
launched a series of internal awareness campaigns on the
(Data, Digital, Design) Academy, involvement in regional 3D
Code. In addition to setting a clear tone from the top leadership,
initiatives, etc. in preparation for a future that will see them work
GHR has focused on actively engaging employees through
alongside AI, robotics and data in a highly digitalised
branch visits and conventions to further embed integrity and
environment.
infused a stronger focus on compliance culture within the Bank.
• REMUNERATION
• HUMAN RESOURCES POLICIES AND PROCEDURES
CIMB Group’s remuneration philosophy aims to reinforce a
The Human Resources Policies and Procedures (HRPP) of
pay-for-performance culture while ensuring appropriate
CIMB Group provides clarity for the organisation in all aspects
risk-taking behaviour.
of the human resource management in CIMB Group. CIMB
Group reviews its HRPP periodically to ensure that the policies
The governance is established on all remuneration-related
and procedures remain relevant, and appropriate controls are in
matters through CIMB Group Nomination and Remuneration
place to manage operational risks.
Committee (“The Committee”), which reviews and approves
remuneration policies and payouts together with the Board of
Group Human Resource updates employees of changes to
Directors. Decisions on variable remuneration are made based
policies and procedures via email messages/memoranda.
on the performance of the respective units in CIMB Group and
These policies and procedures are also easily accessible by all
taking into consideration risk-adjusted performance measures
employees via CIMB Group’s intranet portal, for employees to
such as Economic Profit and Risk Adjusted Return on Capital,
refer to at their convenience.
which are incorporated in our scorecards and reporting. The
Committee is also guided on their decisions according to the
• PEOPLE DEVELOPMENT
advice and assessment provided by CIMB Group’s risk, audit
Efforts to identify talent beyond the succession pool through the and compliance functions on the respective units in CIMB
new talent classification framework have substantially Group.
strengthen the talent pool for CIMB Group through the
unearthing of unpolished gems across the regions. In addition, CIMB Group has a deferred remuneration structure in place
succession realisation has started to bear fruit across the through an equity ownership plan, where the share awards are
Group since the inception of the new Talent and Succession vested over 3 years. This share-based long term incentive plan
Framework in 2017 where critical roles have been filled internally applies to key personnel and senior management of CIMB
and efforts to accelerate the readiness of our talent has glaringly Group, as well as identified material risk takers. The plan serves
intensified through our fit for purpose development suite. to align the interest of this group of employees to that of our
shareholders and to increase focus towards long-term
Internal internship has also been introduced to expose talent to sustainability, as well as retaining them with CIMB Group.
functions and businesses beyond their comfort zone; mainly
through involvement in the Forward23 initiatives. In addition, the • CULTURE
continuous collaboration between Global Employee Mobility
GHR ran a campaign called “ABC bite-sized” where the three
and Regional Talent Management has also been instrumental in
critical behaviours were broken down to help employees better
driving international assignments as a key development
understand and remember the three critical behaviours.
intervention to prepare our people for their future roles.
Successful secondments of our talent in the Fast Forward
For this campaign, a different behavior, accompanied by real life
initiative in Thailand as well as deployment of our middle and
testimonials from staff of how they live the behaviour, is
senior talent across the Group through international
promoted every two months using various channels – Email,
assignments are testaments to our commitment to grow talent
Instagram, Branch/Departmental TVs & lift screens. GHR also
through experiential development.
piloted “Have Your Say” mailbox in GHR to provide an efficient
mechanism and a safe space for staff to give suggestions and
The introduction of the 360 Feedback Survey has also given us
highlight concerns/issues both digitally and physically. Through
a platform to assess the leadership styles and organisation
this initiative we hope that many good ideas can be acted upon
climate while promoting a culture of transparency. As part of the
and implemented to help create a better working environment
continuous effort to expose our talent to the best in class, they
that fosters empathy, support and encourages open
have been extensively involved in regional conferences and
engagement.
executive leadership programmes, both as participants as well
as speakers.

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statement on risk management and internal control

• WHISTLE BLOWING Regular reviews, re-assessments and updates for BCM

documentations/plans have been conducted to ensure
In 2019, GHR has taken steps to increase the Whistle Blowing
adequacy, effectiveness and relevance of the business recovery
channels for its employees and third parties in making a
strategies. These plans are rehearsed and tested on a regular
disclosure. The additional channels are provided with a link to
basis.
the Disclosure Form which can be found on CIMB Homepage
(quick link via tile and landing page), CIMB Clicks and Sync-up.
Our Group has a BCM department, whose primary role is to
All new employees are also briefed on the Whistle Blowing
ensure effective coordination and supervision of all BCM
during the Group Orientation programme. In addition, bunting
activities by introducing integrated and standardised BCM
on the Whistle Blowing are placed in our office premises
approach across the organisation.
besides screen savers on computers and pop-ups in the
Human Resource Information System before the staff are
allowed to proceed with their HR transactions. R E V I E W O F S TAT E M E N T BY E X T E R N A L AU D I TO R S

• ANTI-BRIBERY AND CORRUPTION As required by Paragraph 15.23 of the Bursa Malaysia Securities
Berhad Main Market Listing Requirements, the external auditors
One of the core values of CIMB Group is integrity, and CIMB
have reviewed this Statement on Risk Management and Internal
Group will not tolerate any acts which are in breach of this
Control. Their limited assurance review was performed in
value. CIMB Group firmly believes in acting professionally, fairly
accordance with Audit and Assurance Practice Guide (“AAPG”) 3
and with integrity in all business dealings and relationships.
issued by the Malaysian Institute of Accountants. AAPG 3 does not
Whilst CIMB Group already has in place various policies and
require the external auditors to form an opinion on the adequacy
processes, which address some of the issues relating to bribery
and effectiveness of the risk management and internal control
and corruption, a more comprehensive policy to cover areas of
systems of CIMB Group.
concern is deemed necessary in view that CIMB Group
operates in many jurisdictions with anti-corruption laws. As
such, in line with global best practices and good governance
approach, CIMB Group has established the Anti-Bribery and CONCLUSION
Corruption Policy. As commitment to this Anti-Bribery and
Corruption Policy, CIMB has also developed a No Gift Policy in The Board, through the Audit Committee, Board Risk and
our conduct with our customers in relation to entertainment and Compliance Committee and the Board Shariah Committee,
the receipt and giving of gifts. confirms that it has reviewed the effectiveness of the risk
management and internal control framework and considers CIMB
• BUSINESS CONTINUITY MANAGEMENT Group’s system of internal control as adequate in safeguarding the
shareholders’ interests and assets of CIMB Group. The Board also
BCM program is in place as part of our ongoing commitment in
confirms that there is an effective ongoing process for identification,
ensuring business resilience throughout our Group. Continuity
evaluation and management of significant risks in CIMB Group and
of service to our customers, together with all the supporting
is committed to ongoing review of the entire control, compliance
business processes, is fundamental to meeting our business
and risk management controls.
objectives. The Management are responsible to ensure
enterprise-wide implementation of sound BCM practices as
part of good corporate governance and prudent risk
management.

We have put in place a sound BCM program aiming to deliver

organisational resilience by ensuring that critical business
process can continue or be recovered in a timely manner
following a disruption and ensure the Group meets BCM
statutory and regulatory responsibilities and that it adheres to
accepted best practices.

Our BCM Program is aligned to the organisation’s business

vision and strategy. This is done by calibrating the Group’s BCM
Program to the target level of preparedness, which is
determined by the Group BCM Steering Committee.

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 risk

R I S K M A N AG E M E N T OV E R V I E W

A robust and effective risk management system is critical for our requirements. These inputs enable the business units to assess the
Group to achieve continued profitability and sustainable growth in risk-vs-reward of their propositions, thus enabling risk to be priced
shareholder value in today’s globalised and inter-linked financial and appropriately in relation to the return.
economic environment.
Generally, the objectives of our risk management activities are to:
Our Group embraces risk management as an integral part of our
(i) identify the various risk exposures and capital requirements;
Group’s business, operations and decision-making processes. In
ensuring that our Group achieves optimum returns whilst operating (ii) ensure risk-taking activities are consistent with risk policies
within a sound business environment, the risk management teams and the aggregated risk positions are within the risk appetite
are involved at the early stage of the risk-taking process by as approved by the Board; and
providing independent inputs, including relevant valuations, credit
(iii) create shareholder value through a sound risk management
evaluations, new product assessments and quantification of capital
framework.

E N T E R P R I S E W I D E R I S K M A N AG E M E N T F R A M E WO R K

Our Group employs a Group Enterprise-Wide Risk Management Three Lines of Defence approach, whereby risks are managed
(EWRM) framework as a standardised approach to effectively at the point of risk-taking activity. There is clear accountability
manage our risks and opportunities. The Group EWRM framework of risk ownership across the Group.
provides our Board and management with tools to anticipate and
manage both the existing and potential risks, taking into (ii) Governance & Organisation: A strong governance structure is
consideration changing risk profiles as dictated by changes in important to ensure an effective and consistent
business strategies, the external environment and/or the regulatory implementation of the Group EWRM framework. The Board is
environment. ultimately responsible for the Group’s strategic direction,
which is supported by the risk appetite and relevant risk
The key components of the Group EWRM framework are management frameworks, policies and procedures. The
represented in the diagram below: Board is assisted by various risk committees and control
functions in ensuring that the Group’s risk management
framework is effectively maintained.
G O V E R N A N C E & O R G A N I S A T I O N

(iii) Risk Appetite: Defined as the amount and type of risks that
the Group is able and willing to accept in pursuit of its
R I S K A P P E T I T E strategic and business objectives. Risk appetite is set in
Risk Management Process conjunction with the annual strategy and business planning
Risk Culture

process to ensure appropriate alignment between strategy,

Business
Risk
Risk
Risk
Risk
Monitoring
growth aspirations, operating plans, capital and risk.
Identification Management
Planning Measurement &
& Assessment & Control Reporting
(iv) Risk Management Process:
• Business Planning: Risk management is central to the
Risk Policies,
Methodologies/ People
Technology business planning process, including setting frameworks
& Data
Standards & Procedures
for risk appetite, risk posture and new product/new
Risk Management Infrastructure business activities.
• Risk Identification & Assessment: Risks are systematically
identified and assessed through the robust application of
The design of the Group EWRM framework incorporates a the Group’s risk policies, methodologies/standards and
complementary ‘top-down strategic’ and ‘bottom-up tactical’ risk procedures.
management approach.
• Risk Measurement: Risks are measured and aggregated
using the Group-wide methodologies across each of the
The key features of the Group EWRM framework include:
risk types, including stress testing.
(i) Risk Culture: The Group embraces risk management as an
integral part of its culture and decision-making processes. The
Group’s risk management philosophy is embodied in the

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risk management

• Risk Management & Control: Risk management limits and The responsibility of supervising risk management functions is
controls are used to manage risk exposures within the risk delegated to our GRCC, comprised of senior management, and
appetite set by the Board. Risk management limits and reports directly to our BRCC. Our GRCC performs the oversight
controls are regularly monitored and reviewed in the face function on the overall risks undertaken by the Group in delivering
of evolving business needs, market conditions and its business plans vis-à-vis the stated risk appetite of our Group.
regulatory changes. Corrective actions are taken to Our GRCC is supported by specialised risk committees, namely
mitigate risks. Group Credit Committee, Group Market Risk Committee, Group
Operational & Resiliency Risk Committee, Group Asset Liability
• Risk Monitoring & Reporting: Risks on an individual, as
Management Committee and Group Asset Quality Committee,
well as a portfolio, basis are regularly monitored and
each addressing one or more of the following:
reported to ensure they remain within the Group’s risk
appetite. (i) Market risk, arising from fluctuations in the value of the trading
or investment exposure due to changes in market risk factors
(v) Risk Management Infrastructure such as interest rates, currency exchange rates, credit
spreads, equity prices, commodities prices and their
• Risk Policies, Methodologies/Standards and Procedures
associated volatility;
addressing all areas of material risks: Well-defined risk
policies by risk type provide the principles by which the (ii) Credit risk, arising from the possibility of losses due to an
Group manages its risks. Methodologies/Standards obligor, market counterparty or an issuer of securities or other
provide specific directions that help support and enforce instruments held, failing to perform its contractual obligations
policies. Procedures provide more detailed guidance to to the Group;
assist with the implementation of policies.
(iii) Liquidity risk, arising from a bank’s inability to efficiently meet
• People: Attracting the right talent and skills is key to its present and future funding needs or regulatory obligations
ensuring a well-functioning Group EWRM framework. The when they come due, which may adversely affect its daily
organisation continuously evolves and proactively operations and incur unacceptable losses;
responds to the increasing complexity of the Group, as
(iv) Operational risk, arising from risk of loss resulting from
well as the economic and regulatory environment.
inadequate or failed internal processes, people and systems,
• Technology and Data: Appropriate technology and sound or from external events;
data management support risk management activities.
(v) Interest rate/rate of return risk in the banking book, which is
the current and potential risk to the Group’s earnings and
R I S K G OV E R N A N C E economic value arising from movements in interest rates/
profit rates;
At the apex of the governance structure are respective Boards of
(vi) Capital risk, arising from the failure to meet minimum
entities within the Group, which decide on the entity’s risk appetite
regulatory and internal requirements which could incur
corresponding to its business strategies. Each Board Risk and
regulatory sanction on our Group, thereby resulting in a
Compliance Committee (BRCC) reports directly to the respective
potential capital charge; and
Boards and assumes responsibility on behalf of the respective
Boards for the supervision of risk management and control (vii) Shariah Non Compliance (SNC) risk, arising from risk of
activities. Each BRCC determines the relevant entity’s risk possible failure to comply with the Shariah requirements
strategies and policies, keeping them aligned with the principles determined by Shariah Advisory Council (SAC) of Bank
within the risk appetite. Each BRCC also oversees the Negara Malaysia (BNM) and Securities Commission (SC),
implementation of the Group EWRM framework, provides strategic Board Shariah Committee (BSC) of the Group and other
guidance and reviews the decisions of our Group Risk and Shariah regulatory authorities of the jurisdictions in which the
Compliance Committee (GRCC). Group operates.
(viii) Sustainability risk, comprising environmental and social issues
To facilitate the effective implementation of Group EWRM
stemming from transactions/activities associated with a
framework, our BRCC has established various specialised/sub-risk
business relation and its operations and/or the Group’s own
committees within our Group, each with distinct lines of
internal operations and employees.
responsibilities and functions, which are clearly defined in the terms
of reference.

130
The structure of CIMB Group Risk Committees is depicted in the following chart:

Board of Directors

Board Risk & Compliance Committee Board Shariah Committee

Group Risk & Compliance Committee

Group Operational & Group Asset Liability Group Group Group

Resiliency Risk Management Credit Asset Quality Market Risk
Committee Committee Committee Committee Committee

Group Group
Suitability Underwriting
Review Committee
Committee

Deal Launch
Committee

Our overseas subsidiaries’ risk committees are set-up in a similar appetite, and is in compliance with regulations. The third line of
structure in their respective jurisdictions. Whilst recognising the defence is Corporate Assurance Division who provides
autonomy of the local jurisdiction and compliance to local independent assurance of the adequacy and effectiveness of the
requirements, our Group strives to ensure a consistent and internal controls and risk management processes.
standardised approach in its risk governance process. As such,
Group and Regional committees have consultative and advisory
THE ROLES OF GROUP CHIEF RISK OFFICER
responsibilities on regional matters across our Group as regulators
(GROUP CRO) AND GROUP RISK
allow. This structure increases regional communication regarding
technical knowledge. It further enhances support towards
Within the second line of defence is Group Risk, a function
managing and responding to risk management issues, thus
independent of business units. It assists our Group’s management
allowing our Board with a comprehensive view of the activities
and stakeholders in monitoring and controlling risk exposures within
within our Group.
the Board-approved risk appetite statement.

THREE LINES OF DEFENCE Group Risk is headed by our Group CRO, appointed by our Board
to lead the Group-wide risk management functions, including the
Our Group’s risk management culture is embodied through the implementation of the Group EWRM framework. Our Group CRO:
adoption of the Three Lines of Defence philosophy, whereby risks
(a) actively engages the respective boards and senior
are managed from the point of risk-taking activities. This is to
management on risk management issues and initiatives; and
ensure clear accountability of risk across our Group and risk
management as an enabler of business units. As a first line of (b) maintains an oversight on risk management functions across
defence, the line management (including key Business Pillars and all entities within our Group. In each key country of operations,
Enablers) is primarily responsible for risk management on a there is a local Chief Risk Officer or a local Head of Risk
day-to-day basis by taking appropriate actions to mitigate risk Management, whose main functions are to assess and
through effective controls. The second line of defence provides manage the enterprise risk and liaise with regulators in the
oversight and perform independent monitoring of business activities respective countries.
with reporting to the Board and management to ensure that our
Group conducts business and operates within the approved

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risk management

The organisational structure of Group Risk is made of two major • Non-Financial Risk Management CoE
components, namely the Chief Risk Officer and the Risk Centres of
The Non-Financial Risk Management (NFRM) CoE ensures that
Excellence (CoE).
the first line of defence manages their operational risk by
providing an operational risk framework that enables them to
(a) Chief Risk Officers
identify, assess, manage and report their operational risks. The
i) CRO’s main function is to assess and manage the team also provides constructive challenge and assessment to
enterprise risk and liaise with regulators in the respective the first line of defence’s execution of the operational risk
country/entity under his/her purview; framework and act as a consultant with the Group in providing
operational risk expertise and reporting to senior management.
ii) The CRO is supported by the CRO International Offices
who oversee the risk management functions of the
The Shariah Risk Management (SRM) unit within the NFRM CoE
regional offices e.g. branches and small overseas
facilitates the process of identifying, measuring, controlling and
banking subsidiaries;
monitoring SNC risks inherent in the Group’s Islamic banking
iii) For countries where a CRO is not present and/or not businesses and services. It formulates, recommends and
required, a local Head of Risk Management is appointed implements appropriate SRM policies and guidelines; as well as
to be the overall risk coordinator for that country. develops and implements processes for SNC risk awareness.

(b) Risk Centres of Excellence NFRM CoE also extend its specialist risk oversight to cover
Business Continuity Management, Fraud, Technology and
i) These are specialised teams of risk officers responsible
Outsourcing risks.
for the active oversight of Group-wide functional risk
management and the teams support respective CRO in
• Asset Liability Management CoE
the various geographies.
The Asset Liability Management CoE recommends the
ii) The Risk CoEs consist of Risk Analytics, Credit Risk
framework and policies for the independent assessment,
Infrastructure, Market Risk, Non-Financial Risk
measurement and monitoring of liquidity risk and interest rate
Management (comprising Operational, Shariah, Business
risk in the banking book. It conducts regular stress testing on
Continuity Management, Technology, Outsourcing &
the Group’s liquidity and interest rate risk in the banking book
Fraud Risk Management), Asset Liability Management,
profile, by leveraging on the standardised infrastructure it has
and Credit Risk.
designed, built and implemented across the region. It provides
the framework and tools for maintenance of the early warning
• Risk Analytics CoE
system indicators and contingency funding plan by business
The Risk Analytics (RA) CoE ensures the Group’s compliance to owners across the Group.
regulatory requirements prescribed for IRB Approach and
facilitates other Risk CoEs in their respective risk management • Credit Risk CoE
through Internal Capital Adequacy Assessment Process
The Credit Risk CoE consists of Retail and Non-Retail credit risk
(ICAAP), Risk Appetite and Stress Testing. RA CoE also
and is dedicated to the assessment, measurement,
validates credit risk models and performs non-retail credit risk
management, monitoring and reporting of credit risk of the
analytics, asset quality reporting and Single Counterparty
Group. It ensures a homogenous and consistent approach to
Exposure Limit (SCEL) regulatory reporting.
credit risk policies, methodologies and procedures; credit risk
models; underwriting; and portfolio analytics.
• Credit Risk Infrastructure CoE

The Credit Risk Infrastructure (CRI) CoE implements risk In ensuring a standardised approach to risk management
infrastructure of loan decision engine and rating system which across our Group, all risk management teams within our Group
encompass credit risk models and lending criteria. The CoE are required to conform to the Group EWRM framework,
also manages a Risk Data Mart that facilitates Credit Risk, Risk subject to necessary adjustments required for local regulations.
Weighted Asset (RWA) and SCEL reporting and analytics. For branches and subsidiaries without risk management
department, all risk management activities are centralised at the
• Market Risk CoE relevant Risk CoEs. Otherwise, the risk management activities
are performed by the local risk management team with matrix
The Market Risk CoE recommends the framework and policies
reporting line to the relevant Risk CoEs.
for independent assessment, measurement and monitoring of
market risk. This is operationalised through review of treasury
positions versus limits, performing mark-to-market valuation,
calculating Value at Risk and market risk capital, as well as
performing stress testing.

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 K E Y A R E A S O F R I S K M A N AG E M E N T

1. CREDIT RISK The GRCC, with the support of Group Credit Committee,
Group Asset Quality Committee, other relevant credit
Credit risk is defined as the possibility of losses due to an
committees as well as Group Risk, is responsible for ensuring
obligor, market counterparty or an issuer of securities or other
adherence to the Board’s approved risk appetite and risk
instruments held, failing to perform its contractual obligations
posture. This, amongst others, includes reviewing and
to the Group.
analysing of portfolio trends, asset quality, watch-list reporting
and reviewing policy. It is also responsible for articulating key
Credit risk is inherent in banking activities and arises from
credit risks and mitigating controls.
traditional financing activities through conventional loans,
financing facilities, trade finance, as well as commitments to
Adherence to and compliance with country sector limit, single
support clients’ obligations to third parties, e.g. guarantees. In
customer and country and global counterparty limits, are
derivatives, sales and trading activities, credit risk arises from
approaches adopted to address concentration risk to any
the possibility that our Group’s counterparties will be unable
large sector or industry, or to a particular counterparty group
or unwilling to fulfil their obligation on transactions on or before
or individual.
settlement dates.
Adherence to the above established credit limits is monitored
Credit Risk Management
daily by Group Risk, which combines all exposures for each
Without effective credit risk management, the impact of the counterparty or group, including off balance sheet items and
potential losses can be overwhelming. The purpose of credit potential exposures. For retail products, portfolio limits are
risk management is to keep credit risk exposure to an monitored monthly by Group Risk.
acceptable level vis-à-vis the capital, and to ensure the returns
commensurate with risks. It is our Group policy that all exposures must be rated or
scored based on the appropriate internal rating models, where
Consistent with the three lines of defence model on risk available.
management where risks are managed from the point of
risk-taking activities, our Group implemented the risk-based Retail exposures are managed on a portfolio basis and the
delegated authority framework. This promotes clarity of risk risk rating models are designed to assess the credit
accountability whereby the business unit, being the first line of worthiness and the likelihood of the obligors to repay their
defence, manages risk in a proactive manner with Group Risk debts, performed by way of statistical analysis from credit
as a function independent from the business units as the bureau and demographic information of the obligors. The risk
second line of defence. This enhances the collaboration rating models for non-retail exposures are designed to assess
between Group Risk and the business units. the credit worthiness of the corporations or entities in paying
their obligations, derived from both quantitative and qualitative
The risk-based delegated authority framework encompasses risk factors such as financial history and demographics or
joint delegated authority, enhanced credit approval process company profile. These rating models are developed and
and a clear set of policies and procedures that defines the implemented to standardise and enhance the credit
limits and types of authority designated to the specific underwriting and decision-making process for our Group’s
individuals. retail and non-retail exposures.

Our Group adopts a multi-tiered credit approving authority Credit reviews and ratings are conducted on the non-retail
spanning from the delegated authorities at business level, joint credit exposures at minimum on an annual basis, and more
delegated authorities holders between business units and frequently when material information on the obligor or other
Group Risk, to the various credit committees. The credit external factors come to light.
approving committees are set up to enhance the efficiency
and effectiveness of the credit oversight as well as the credit The exposures are actively monitored, reviewed on a regular
approval process for all credit applications originating from the basis and reported regularly to GRCC and Board Risk and
business units. For corporate, commercial loans and private Compliance Committee. Asset quality is closely monitored so
banking loans, credit applications are independently evaluated that deteriorating exposures are identified, analysed and
by the Credit Risk CoE team prior to submission to the joint discussed with the relevant business units for appropriate
delegated authority or the relevant committees for approval; remedial actions, including recovery actions, if required.
certain business units officers are delegated with credit
approving authority to approve low valued credit facilities. For Credit Risk Mitigation
retail loans, all credit applications are evaluated and approved
The employment of various credit risk mitigation techniques
by Consumer Credit Operations according to the designated
such as appropriate credit structuring, and posting of
delegated authority with higher limit approved at joint
collateral and/or third party support form an integral part of
delegated authority and relevant credit committee.
credit risk management process. Credit risk mitigants are
taken where possible and are considered secondary recourse
to the obligor for the credit risk underwritten.

133
risk management

All extension of secured credit facilities as deemed prudent, using the applicable market price and pricing model. The
must be appropriately and adequately collateralised. A credit valuation process is carried out with the independent price
proposal is considered secured only when the entire proposal verification requirements to ensure that financial assets/
is fully covered by approved collateral/securities within their liabilities are recorded at fair value. The valuation methods and
approved margins as set out in the relevant credit policy models used are validated by risk management quantitative
guides. Group Credit Committee is empowered to approve analysts to assess their applicability relative to market
any inclusion of new acceptable collaterals/ securities. conditions.

Recognised collaterals include both financial and physical Our Group also adopts the Value-at-Risk (VAR) methodology
assets. Financial collaterals consist of mainly cash deposits, as an approach in the measurement of market risk. VAR is a
quoted shares, unit trusts and debt securities, while physical statistical measure of the potential losses that could occur as
collateral includes land, buildings and vehicles. a result of movements in market rates and prices over a
specified time horizon within a given confidence level.
Guarantors accepted are in line with BNM’s Capital Adequacy
Framework (Basel II – Risk-Weighted Assets) and Capital Stress testing is conducted to capture the potential market
Adequacy Framework for Islamic Banks (Risk-Weighted risk exposures from an unexpected market movement. In
Assets) guidelines. Eligible credit protection is also used to formulating stress scenarios, consideration is given to various
mitigate credit losses in the event that the obligor/counterparty aspects of the market; for example, identification of areas
defaults. where unexpected losses can occur and areas where
historical correlation may no longer hold true.
In mitigating the counterparty credit risks from foreign
exchange and derivatives transactions, our Group enters into In addition to the above, Market Risk CoE undertakes the
master agreements that provide for closeout netting with monitoring and oversight process at Treasury & Markets
counterparties, whenever possible. A master agreement that trading floors, which include reviewing and analysing treasury
governs all transactions between two parties, creates the trading activities vis-à-vis changes in the financial markets,
greater legal certainty that the netting of outstanding monitoring limits usage, assessing limits adequacy and
obligations can be enforced upon termination of outstanding verifying transaction prices.
transactions if an event of default occurs.
3. LIQUIDITY RISK
For each counterparty where credit support annex has been
executed in addition to master netting agreement, our Group Liquidity risk is defined as the current and potential risk to
will request for additional collateral for any exposures above earnings, shareholder funds or our reputation arising from our
the agreed threshold, in accordance with the terms specified Group’s inability to efficiently meet our present and future
in the relevant credit support annexes. (both anticipated and unanticipated) funding needs or
regulatory obligations when they are due, which may
Our Group avoids unwanted credit or market risk adversely affect our daily operations and incur unacceptable
concentrations by diversifying our portfolios through a number losses. Liquidity risk arises from mismatches in the timing of
of measures. Amongst others, there are guidelines in place cash flows.
relating to maximum exposure by products, counterparty,
sectors and country. The objective of our Group’s liquidity risk management is to
ensure that our Group can meet its cash obligations in a timely
2. MARKET RISK and cost-effective manner. To this end, our Group’s liquidity
risk management policy is to maintain high quality and well
Market risk is defined as any fluctuation in the value of a diversified portfolios of liquid assets and sources of funds
trading or investment exposure arising from changes to under both business-as-usual and stress conditions. Due to
market risk factors such as interest rates, currency exchange its large delivery network and marketing focus, our Group is
rates, credit spreads, equity prices, commodities prices and able to maintain a diversified core deposit base comprising
their associated volatility. retail transactions accounts, savings, demand and term
deposits, thus providing our Group with a stable, large funding
Our Group hedges the exposures to market risk by employing base. Our Group maintains some buffers of liquidity
various strategies, including the use of derivative instruments. throughout the year to ensure safe and sound operations from
a strategic, structural and tactical perspective.
Our Group adopts various measures as part of risk
management process. Our GRCC with the assistance of The day-to-day responsibility for liquidity risk management
Group Market Risk Committee and its delegated committees and control in each individual entity is delegated to the
ensure that the risk exposures undertaken by our Group is respective Country Asset Liability Management Committee,
within the risk appetite approved by our Board. which subsequently reports to Group Asset Liability
Management Committee. The Group Asset Liability
Market Risk CoE is responsible for measuring and controlling Management Committee meets at least once a month to
our Group’s market risk through robust measurement and discuss the liquidity risk and funding profile of the Group. The
market risk limit monitoring while facilitating business growth key liquidity risk metrics comprise of internal liquidity gaps or
within a controlled and transparent risk management cashflow maturity profile mismatches under business as usual
framework. Market Risk CoE evaluates the market exposures and stress scenarios, regulatory liquidity coverage ratio

134
 (“LCR”) and Net Stable Funding Ratio (“NSFR”) which are Markets is responsible for day-to-day management of
measured and monitored regularly. LCR is a quantitative exposure and gapping activities, including execution of
regulatory requirement which seeks to ensure that banking hedging strategies.
institutions hold sufficient high quality liquid assets (“HQLA”)
to withstand an acute liquidity stress scenario over a Interest rate risk in the banking book is measured by:
30-calendar-days horizon. Our Group monitors and reports
(i) Economic Value of Equity (EVE) sensitivity measures the
LCR and NSFR based on the BNM LCR and NSFR Policy
long term impact of sudden interest rate movement
Document dated 25 August 2016 and 31 July 2019
across the full maturity spectrum of our Group’s assets
respectively. The effective date for NSFR is 1 July 2020. As
and liabilities. It defines and quantifies interest rate risk as
part of its ordinary course of business, the Bank maintains the
the change in the economic value of equity (e.g. present
LCR and NSFR above the regulatory requirements. In addition,
value of potential future earnings and capital) as asset
liquidity risk stress testing under various scenarios covering
portfolio values and liability portfolio values would rise
bank-specific (idiosyncratic), market-wide and combined
and fall with changes in interest rates. This measure
crises is performed regularly to identify sources of potential
helps the Group to quantify the risk and impact on
liquidity strain.
capital with the focus on current banking book positions.
In addition to regulatory limits, liquidity risk undertaken by our (ii) Earnings At Risk (EAR) is the potential impact of interest
Group is governed by a set of established liquidity risk limits rate changes on the bank’s accruing or reported
and appetite. Management Action Triggers (MATs) have been earnings. It focuses on risk-to-earnings in the near term,
established to alert management to potential and emerging typically the next one year. Fluctuations in interest rates
liquidity pressures. Our Group’s Liquidity Risk Management rate generally affect reported earnings through changes
Policy is subjected to periodic review. The assumptions, risk in the bank’s net interest income, which is the difference
limits and appetite are regularly reviewed in response to between total interest income earned from assets and
regulatory changes, changing business needs and market total interest expense incurred from liabilities. Our
conditions. Group’s EAR is taking into consideration forecasts on
budgeted new business generation and product pricing
The Asset-Liability Management function, which is responsible strategies.
for the independent monitoring of our Group’s liquidity risk
profile, works closely with Treasury and Markets in its 5. NON-FINANCIAL RISK MANAGEMENT OVERSIGHT
surveillance on market conditions. Business units are
responsible for establishing and maintaining strong business Operational risk managed under Group Non-Financial Risk
relations with their respective depositors and key providers of Management is the risk of loss resulting from inadequate or
funds. Overseas branches and subsidiaries should seek to be failed internal processes, people and systems or from external
self-sufficient in funding at all times. Treasury and Markets only events. It includes legal risk but excludes strategic and
acts as a global provider of funds on a need-to or contingency reputation risks.
basis. Each entity has to prudently manage its liquidity
position to meet its daily operating needs. Our Group’s Operational Risk Management Oversight
Contingency Funding Plan (CFP) is in place to alert and enable The NFRM CoE, a second line of defence function, provides
the management to act effectively and efficiently during a the methodology, tools and processes for the identification,
liquidity or funding crisis and under adverse market assessment, reporting, and management of operational risks
conditions. The CFP is subjected to regular testing. by the respective risk owners across the Group. The NFRM
CoE also independently oversees the operational risk controls
4. INTEREST RATE RISK IN THE BANKING BOOK monitoring that reside within the first line of defence.
Interest rate risk in the banking book is defined as the current
and potential risk to our Group’s earnings and economic value Identified risks are rated using a defined risk rating
arising from movement in interest rates. methodology applied across the Group’s three lines of
defence. Monitoring of the identified risks is primarily done
Our Group manages its exposure of fluctuations in interest through the Group Operational & Resiliency Risk Committee
rates through policies established by Group Asset Liability (GORRC) or relevant risk management committees operating
Management Committee. Interest rate risk in the banking in each material geography and business line. These
book undertaken by our Group is governed by an established committees report up to the relevant functional or country
risk appetite that defines the acceptable level of risk to be level committees.
assumed by our Group. The risk appetite is established by the
Board. The Group Asset Liability Management Committee is a The GORRC is the senior management committee at the
board-delegated committee which reports to the GRCC. With Group-level that is tasked to oversee the operational risk
the support from Asset Liability Management CoE under framework and policies to ensure they are appropriate for the
Group Risk, and Capital and Balance Sheet Management size and complexity of the current and future operations of
under Group Finance, our Group Asset Liability Management CIMB Group and make recommendation to the GRCC for
Committee is responsible for the review and monitoring of approval. GORRC oversees and monitors the overall control
Group’s balance sheet, business and hedging strategies, the environment of CIMB Group and reports to Group Risk and
overall interest rate risk profile and ensuring that such risk Compliance Committee (GRCC) on material operational risks.
profile is within the established risk appetite. Treasury &

135
risk management

Non-Financial Risk Management Approach Shariah regulatory authorities of the jurisdictions in which the
CIMB Group recognises that the key determinant for a Group operates. SNC may result in financial and non-financial
well-managed banking operation is to cultivate an impact to the Group such as nullification of contract, non-
organisation-wide risk management discipline and culture. recognition of income or earnings, regulatory breach,
Our Group manages operational risks through the following reputation risk, etc.
key measures:
The appropriate treatment of any SNC income or earnings
• Sound risk management practices in accordance with shall be advised by the BSC, which may include but is not
Basel regulatory guidelines; limited to, channelling the SNC income or earnings to
• Board and senior management oversight; charitable organisation or returning the SNC income or
• Well-defined responsibilities for all personnel concerned; earnings to customers.
• Establishment of a risk management culture;
Our Group has a Group Shariah Advisory & Board Shariah
• Deployment of Operational Risk Management (ORM) tools Committee Secretariat Policy in place, which governs the roles
that include: and responsibilities of BSC, overall Shariah compliance
– Operational Event and Loss Data Management functions and Shariah governance processes of CIMB Group.
– Risk & Control Self- Assessment Monitoring of Shariah compliance and Shariah governance is
– Control Issue Management carried out through Shariah Review and Shariah Audit functions,
– Key Risk Indicators; supported by SRM control measures and Shariah & Governance.
– New Product Approval Process; and
– Scenario Analysis SRM is facilitated by the SRM unit within NFRM CoE by
implementing a systematic and consistent approach to the
These tools form part of the operational risk framework that management of SNC. The objectives, mission, guiding
allows the Group to effectively identify, measure, mitigate and principles, governance structure, as well as the methodology
report its operational risks. Each material division of the CIMB and approach adopted by the Group in managing SNC risk, are
Group self-assesses on their internal risk and control articulated in the Shariah Risk Management Policy (SRMP).
environment rating and report key control deficiencies with
remediation plans. Apart from monitoring and analysing the SNC events or
incidences submitted by Risk Control Officer/Designated
Each new or varied product with changes to the process flow is Compliance and Operational Risk Officers to Shariah Review
subjected to a rigorous risk review, where all critical and & Assurance under Group Legal and Compliance CoE for
relevant areas of risk are being appropriately identified and escalation to BSC and reporting to the relevant risk
assessed independently from the risk takers or product owners. committees, SRM unit within NFRM CoE also actively
participates in the Islamic products and services development
The promotion of a risk management culture within our Group, process to ensure that all SNC risk are appropriately identified,
whereby the demand for integrity and honesty is non- assessed, managed and controlled. The new products and
negotiable, remains the core theme in our operational risk services as well as internal policies and procedures that are
awareness programme. Additionally, the e-learning module on applicable to Islamic banking businesses and services are
operational risk management has enhanced the awareness of subject to prior approval from BSC before implementation.
operational risk amongst the staff.
8. SUSTAINABILITY RISK
6. REPUTATION RISK
Sustainability risk refers to environmental and social issues
Reputation risk is defined as current or prospective risk to stemming from transactions/activities associated with a
earnings and capital arising from the adverse perception by business relation and its operations and/or the Group’s own
the stakeholders about the Group’s business practices, internal operations and employees. It also includes the risks or
conduct or financial condition. Such adverse perception, opportunities that the Group may be exposed to, or that may
whether true or not, may impair public confidence in the be available to the Group, because of changing social and
Group, result in costly litigation, or lead to a decline in its environmental conditions.
customer base, business, revenue or share price. Reputation
risk exists throughout the organisation and is essentially a The Sustainability Risk Management Framework enables us to
function of the adequacy of the Group’s internal risk identify, access, govern, manage and monitor economic,
management processes, as well as the manner and efficiency environmental, social and ethical risks through appropriate
with which management responds to external influences. policies, procedures and controls.

The framework for managing reputational risk identifies the Underpinning the Sustainability Risk Management Framework
sources of reputational risks, and monitors and manages these are the Group Sustainability Policy (GSP) and the Group
within a defined risk appetite. The Group Operational & Sustainable Financing Policy which guide the Group’s orientation
Resiliency Risk Committee provides oversight over the and performance to sustainability. These include, among others,
framework execution. conduct of sustainability due diligence to evaluate, adopt and
advocate proactive measures to manage sustainability risks
7. SHARIAH NON-COMPLIANCE RISK arising from the Group’s lending and business activities. For more
SNC risk is the risk that arises from the Group’s possible information about the governance and implementation of the two
failure to comply with the Shariah requirements determined by policies, to refer to the Sustainability Statement of this Annual
SAC of BNM and SC, BSC of CIMB Group and the other Report or the CIMB Group Sustainability Report 2019.

136
 audit committee

OVERVIEW

The Audit Committee of CIMB Group Holdings Berhad (Group AC) is committed to its role
of ensuring high corporate governance practices and providing oversight on the Group’s
financial reporting, risk management and internal control systems.

1.   AT T E N DA N C E O F M E E T I N G S Deliberations at the AC meetings were robust and detailed,

generally lasting for a few hours. Minutes of the AC meetings held
The details of the Group AC membership and meetings held in were provided to members of the respective Boards. The Board
2019 are as follows: would be briefed on the significant matters deliberated during the
AC meetings.
Number of
Name of Committee Meetings
Committee Member Status Held Attended 2 .   AU T H O R I T Y

The AC is a Board delegated committee. In discharging its duties,

Dato’ Mohamed Ross Chairman/ 17 17
the AC has explicit authority to investigate any matter within its
bin Mohd Din Independent
terms of reference. It has full access to and co-operation from
Director
Management and full discretion to invite any Director or Executive
Datuk Mohd Nasir Independent 17 16 Officer to attend its meetings. The AC shall have the necessary
Ahmad Director resources from the Group to discharge its functions effectively. The
AC has full and unrestricted access to information and is able to
Ms Teoh Su Yin Independent 17 13 obtain independent professional advice if necessary, with any
Director expenses related thereto to be borne by the Group.

In addition to the 17 meetings held to deliberate on matters relating

to the Group, 26 other meetings were held by members of the 3 .   S U M M A RY O F AC T I V I T I E S I N 2 0 19
Banking Group Audit Committee (Banking Group AC) to deliberate INTERNAL AND EXTERNAL AUDIT PROCESS
on matters relating to the three Malaysian banking entities, making
a total of 43 meetings for the year. a. Approved the annual internal audit plan and the mid-year
review of the plan in March and August 2019 respectively.
The details of the Banking Group AC membership and meetings Reviewed the audit plan for Business Units based on risk
held in 2019 are as follows: assessment conducted and audit resource requirements.

Number of b. Reviewed GCAD’s revised methodology and practices in

Committee Meetings respect of risk assessment for audit planning purposes and
Name of
audit grading.
Committee Member Status Held Attended
c. Approved the KPIs for GCIA and his direct reports and
Datuk Mohd Nasir Chairman/ 26 26
evaluated the GCIA’s annual performance together with the
Ahmad Independent
remuneration payout.
Director

Dato’ Zainal Abidin Non- 26 24 d. Evaluated GCAD’s overall performance for 2019 and provided
Putih Independent written feedback for improvements.
Director
e. Reviewed the summary of internal audit work performed
Puan Rosnah Dato’ Independent 26 25 across the region together with the audit outcome on a
Kamarul Zaman Director quarterly basis.

Puan Nadzirah Abd Independent 26 26 f. Reviewed and approved the External Auditor’s 2020 audit plan
Rashid Director and scope of work on 25 September 2019.
Madam Ho Yuet Mee Independent 26 22
Director

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audit committee report

g. Held a closing meeting of external audits with the External f. Reviewed the internal control issues identified by internal,
Auditor to review the financial results, MFRS related issues, external and regulatory auditors, Management’s response to
credit related matters, valuation of project investment, group audit recommendations and the implementation of agreed
and tax related matters and areas of concerns identified. action plans. For audits with adverse audit ratings and audit
areas deemed to be critical, AC engages with Management
h. Held 2 meetings with the External Auditor without the more actively to resolve any control weaknesses identified.
presence of the Group Management and Executive Directors
on 25 January 2019 and 24 July 2019 to discuss relevant g. Monitored the implementation of corrective actions by
issues and obtain feedback for improvements. Management; Management need to provide justifications for
any undue delay and present for AC’s approval.
i. Reviewed and recommended for Board’s approval the audit
fees and provision of non-audit services by the External h. Held meetings with the respective ACs and Management of
Auditor in accordance with established procedures; evaluated CIMB Niaga, CIMB Thai, CIMB Cambodia, CIMB Vietnam and
whether such non-audit services would impair the External Touch ‘n Go. In each of the meetings, the businesses and
Auditor’s independence and objectivity. issues of the respective operations were presented and
discussed.
j. Completed the annual assessment on the External Auditor in
November 2019 prior to recommendation to the Board on its i. Attended the Group’s Annual Management Summit where
reappointment; the principal areas assessed were in relevant businesses and support units reviewed their
accordance to BNM’s Guidelines on External Auditor covering operations for the year and presented strategies and plans for
performance, independence and objectivity. the coming year.

Accordingly, the areas assessed included: j. AC Chairman of CIMB Group provided oversight on the
• Level of knowledge, capabilities experience and quality of effective implementation of the CIMB Group Policy on whistle
previous work blowing pursuant to BNM Corporate Governance Framework;
any concerns on illegal, unethical or questionable practices
• Level of engagement with the ACs
escalated to the AC Chairman via the dedicated whistle
• Ability to provide constructive observations and blowing email address objectively investigated and addressed.
recommendations
• Appropriateness of audit approach and the effectiveness AUDIT ISSUES RESOLUTION COMMITTEE (AIRCOM)
of audit planning
a. AIRCom, an AC delegated committee, assisted the AC in
• Timeliness of audit deliverables ensuring the effectiveness of management actions in
• Non-audit services rendered by the External Auditor so addressing key risks and internal control weaknesses. The
that it does not impede their independence appointment of AIRCom Chairman and Alternate Chairman
(held by Senior Management) require the AC’s approval.
k. On track in achieving the requirement on Certification of
Banking Auditors (CBA) as imposed by Asian Institute of b. The AIRCom’s key activities include:
Chartered Bankers (AICB). • Reviewed significant findings arising from audits and
investigations conducted; where necessary, the relevant
GOVERNANCE, RISK AND CONTROL responsible party would attend AIRCom to discuss the
a. Reviewed the adequacy and effectiveness of the Group’s issues and effectiveness of corrective actions taken.
system of internal controls, financial reporting and risk • Reviewed findings to identify common themes and holistic
management (based on audit plan coverage). solutions to address the root cause(s).
• Reviewed reasons for any delayed implementation of
b. Endorsed GCAD’s enhanced methodology for identifying, agreed action plans and to escalate to higher authority
assessing and covering risk areas. where required; to provide recommendation for AC’s
approval for cases with repeated extension of
c. Reviewed the Group’s compliance with regulatory requirements implementation date (the process of revising target
and internal policies (based on audit plan coverage). implementation date is governed by an established Audit
Follow-Up Framework).
d. Encouraged robust discussion on emerging risks, key
• Assess any decision by risk owners to accept the risk
challenges and operational concerns, including requiring
exposure of audit findings (i.e to not take corrective
Management to present their strategies and action plans in
actions, based upon the risk owners’ cost benefit
achieving established objectives.
analysis); provide appropriate recommendation for AC’s
endorsement of the risk acceptance.
e. Reviewed the efficiency of GCAD’s operations and the
economical utilisation of its resources.

138
c. The AIRCom meetings were held monthly prior to any AC c. Pursuant to MFRS 124 on Related Party Disclosures,
meetings for the month; minutes of the AIRCom meetings significant RPT balances and transactions were reviewed on
were submitted to AC for notification and discussion. quarterly basis, with explanations provided for exceptional
trend or transactions.
FINANCIAL REPORTING
d. All loans and financing granted to connected parties (pursuant
a. Reviewed the financial statements of the Group on a quarterly
to BNM’s Guidelines on Credit Transactions and Exposures
basis and the draft announcements before recommending
with Connected Parties) are under the direct purview of the
them for the Board’s approval.
respective Board of Directors.
b. Reviewed the financial results prior to the approval by the
Board; discussed the following as highlighted by the External 4 .   S U M M A RY O F G CA D ’ S K E Y AC T I V I T I E S
Auditor in audited financial reports:
• Significant accounting and audit matters involving credit, a. Carried out audits and investigations on the Group; issued
treasury, taxation and impairment related matters 308 reports during the year.
(Note: In addition to the above reports issued, a number of regulatory
• Information technology matters driven assignments had also been completed)
• Group related matters (i.e. impairment of Permata loans &
cost of investment in CIMB Investment Bank, assessment GCAD’s scope of coverage encompassed all business and
of goodwill impairment and intangible assets) support units; areas audited included treasury related matters,
loans & financing (retail & non retail), distribution channels,
• Summary of any uncorrected misstatements
back office operations, IT operations & security, Head Office
• MFRS 9 related matters which include the review of overall functions and also special focus areas such as AML/CFT,
governance framework surrounding MFRS 9 models, customer information secrecy, product transparency,
post-implementation review (i.e. annual validation) and outsourced functions and business continuity.
model monitoring
b. Developed infrastructure to support GCAD’s strategic
c. In relation to the financial statements for the financial year emphasis on Data Analytics and Continuous Auditing.
ended 31 December 2019, the AC at its meeting held on
23 January 2020 was briefed by the External Auditors on the c. Identified potential cost savings and prevention of data and
Key Audit Matters included in the Independent External income leakage from the audits and investigations performed
Auditors’ Report. These are matters regarded as most during the year.
significant by the External Auditors in the audit of the financial
statements of the Group and the Company, which involved d. Monitored and followed up on the implementation of the
significant judgement and estimates by the Management. The corrective actions by Management; appropriate validation was
AC is satisfied that based on the audit procedures performed performed in accordance with GCAD’s Audit Follow-Up
by the External Auditors, no material exceptions were noted Framework.
on those matters.
e. Reported status of outstanding audit findings to AC on a
d. Reviewed write-off proposals as presented by the quarterly basis; undue delays in the implementation of agreed
Management before recommending them for the Board’s action plans were escalated to the relevant authority for further
approval in accordance to established policy. action.

RELATED PARTY TRANSACTIONS (RPTS) AND CONFLICT f. Acted as secretariat of AIRCom, and prepared minutes of
OF INTEREST meeting for submission to AC; other activities included
a. RPTs are reviewed by the AC, taking into account the nature preparing of meeting materials and following-up on matters
and underlying details of the transactions, in establishing any arising.
potential conflict of interest that may arise, before making
recommendation to the Board for approval. g. Conducted 2 regional town hall for top-down communication
on key matters relating to the internal audit function.
b. Pursuant to the Main Market Listing Requirements of Bursa
Malaysia, there was one related party contract recommended h. Conducted a two-day Regional Audit Planning Summit held at
by the AC for the Board’s approval during the year in relation CAD Niaga, Jakarta to discuss and deliberate key audit
to the appointment of a related party company providing methodologies and pressing matters relating to the function.
facilities management services to CIMB for a period of 5 years
commencing from 1 January 2020 to 31 December 2024.

139
audit committee report

i. Enhanced relationship with Management by implementing

Audit
Quarterly Business Monitoring (QBM). GCIA, Department
Committee
Heads or Section Heads have regular meetings with relevant
Member Training attended
key stakeholder to strengthen the working relationship and
business understanding, for better audit focus. Datuk Mohd • Speaking at Malaysian Economic
Nasir Ahmad Convention
j. Reviewed and provided feedback on drafts of new and revised (continued) • ACCA Council Training (June 2019)
policies of the Group through Group Policy & Procedures • “Demystifying The Diversity Conundrum:
Oversight Committee (GPOC). Feedback focused on, but was The Road to Business Excellence" by
not limited to, ascertaining the adequacy of policies’ proposed BURSA Malaysia
governance and controls to address risks. • 2nd PIDM-FIDE FORUM Annual Dialogue
with the CEO of PIDM
k. Submitted periodic reports to the AC, top Management and • Speakers in CIMB INSEAD Leadership
regulators. Programme (CLP) Cohort 8 Module 3
• 3rd Directors Regional Sharing Session
l. Supported AC in the annual review exercise on appointment • ACCA Council Training (September 2019)
of External Auditor. • Speakers in CIMB Young ASEAN Leaders
2019
m. Developed a comprehensive Competency Framework for • Regional Conference on Climate Change
holistic staff development including a training roadmap for • The Cooler Earth Sustainability Summit
continuous upskilling/reskilling our auditors. 46% of auditors • Regional Audit Planning Summit
currently possess the Certification for Bank Auditor (CBA) • Forum on Corporate Governance in the
qualification by the AICB. Capital Market
• CIMB Group’s Annual Management Summit
n. Continued with the Branch Manager Attachment Program to • Adequate Procedures Complying with
promote risk and control culture in the first line of defense; of Section 17A of MACC Act 2009
the 17 branch managers participated in 2019. (2018: 20) • Sesi Perkongsian Pengetahuan dan
Pengalaman untuk SIRIM ‘Talent
o. Passed the Surveillance Audit of ISO 9001:2015 Certification Management Program’
for internal audit services. • Enhancing Corporate Governance by
Understanding Legal Liabilities “Act or
p. Incurred total costs of RM84.5 million (Malaysia: RM41 million) Resign” by Malaysian Anti-Corruption
to maintain the internal audit function of the Group for FY2019. Commission

Dato’ Mohamed • Tech 101 Briefing

5. TR AINING
Ross Bin Mohd • Islamic Finance for Board of Directors
Din Programme by International Shariah
Listed below are the seminars and training events attended by the
Research Academy in Islamic Finance
members of the Audit Committee to keep abreast of latest
• CIMB Tech Risk Workshop
developments (listed in chronological order):
• Bank Negara Malaysia – FIDE: Dialogue
with the Deputy Governor on the Draft Risk
Audit Management in Technology Policy
Committee • Bank Negara Malaysia Financial Industry
Member Training attended Conference 2019
• FIDE Forum – ISRA Programme – Value
Datuk Mohd • Tech 101 Briefing
Based Intermediation: Directors Role
Nasir Ahmad • Chairman Media Training
• 3rd Directors Regional Sharing Session
• Bank Negara Malaysia Annual Report 2018/
• The Cooler Earth Sustainability Summit
Financial Stability and Payments Systems
• Khazanah Megatrends Forum 2019
Report 2018 Briefing Session
• CIMB Group’s Annual Management Summit
• CIMB Tech Risk Workshop
• Enhancing Corporate Governance by
• Chairman Media Training – Workshop 3
Understanding Legal Liabilities “Act or
(Speech Delivery)
Resign” by Malaysian Anti-Corruption
• Bank Negara Malaysia – FIDE: Dialogue
Commission
with the Deputy Governor on the Draft Risk
Management in Technology Policy
• CIMB BOD European Innovation Safari

140
 Audit Audit
Committee Committee
Member Training attended Member Training attended

Dato’ Zainal • Tech 101 Briefing Mdm Ho Yuet • Global Board Leadership Summit
Abidin Putih • BNM Annual Report 2018/Financial Stability Mee • Tech 101 Briefing
and Payment Systems Report 2018 Briefing • Islamic Finance for Board of Directors
Session Programme by International Shariah
• CIMB – Risk Posture Workshop Research Academy in Islamic Finance
• 3rd Directors Regional Sharing Session • Financial Institutions Directors Education
• The Cooler Earth Sustainability Summit (FIDE) Core Programme – Module B
• Khazanah Megatrends Forum 2019 • Digital Assets: Global Trends, Legal
• FIDE/ICLIF Programme – Understanding Requirements and Opportunities for
Fintech and Its Implications for Insurance Financial Institutions
Companies • CIMB Tech Risk Workshop
• CIMB Group’s Annual Management Summit • Bank Negara Malaysia – FIDE: Dialogue
• Enhancing Corporate Governance by with the Deputy Governor on the Draft Risk
Understanding Legal Liabilities “Act or Management in Technology Policy
Resign” by Malaysian Anti-Corruption • FIDE Forum – ISRA Programme – Value
Commission Based Intermediation: Directors Role
• L&G Directors’ in House Training – • 3rd Directors Regional Sharing Session
Leadership Greatness In Turbulent Times • FIDE Elective Programme: Raising Defences
– Building Corporate Longevity: by Erik P.M. – Section 17A, MACC Act
Vermeulen, Senior Legal Counsel & IDMD • 2030 Sustainable Development Goals
Faculty Member Game
• BNM-FIDE Forum Dialogue: Key Aspects of
Puan Rosnah • Tech 101 Briefing Fintech and Regulation
Dato’ Kamarul • CIMB Tech Risk Workshop • The Cooler Earth Sustainability Summit
Zaman • 3rd Directors Regional Sharing Session • Khazanah Megatrends Forum 2019
• The Cooler Earth Sustainability Summit • Leadership Greatness in Turbulence Times
• Leadership Greatness in Turbulence Times – Building Corporate Longevity
– Building Corporate Longevity • Malaysia SDG Summit 2019
• CIMB Group’s Annual Management Summit • CIMB Group’s Annual Management Summit
• Islamic Finance for Board of Directors
Training Programme Teoh Su Yin • Tech 101 Briefing
• Enhancing Corporate Governance by • 3rd Directors Regional Sharing Session
Understanding Legal Liabilities “Act or • The Cooler Earth Sustainability Summit
Resign” by Malaysian Anti-Corruption • Khazanah Megatrends Forum 2019
Commission • Enhancing Corporate Governance by
Understanding Legal Liabilities “Act or
Puan Nadzirah • CIMB Tech Risk Workshop Resign” by Malaysian Anti-Corruption
Abdul Rashid • Islamic Finance – A Catalyst for Financial Commission
Inclusion
• CG Watch: How does Malaysia Rank?
• MyFintech Week 2019
• 3rd Directors Regional Sharing Session
• The Cooler Earth Sustainability Summit
• Khazanah Megatrends Forum 2019
• Malaysia: Post Budget 2020 Forum
• Leadership Greatness in Turbulence Times
– Building Corporate Longevity
• CIMB Group’s Annual Management Summit
• Enhancing Corporate Governance by
Understanding Legal Liabilities “Act or
Resign” by Malaysian Anti-Corruption
Commission

141
board shariah committee

Pursuant to the enterprise wide Shariah governance framework as provided by Bank Negara Malaysia in
its Guideline on Shariah Governance for Islamic Financial Institutions and now as enshrined in the effective
Islamic Financial Services Act 2013, the Board of Directors (the “Board’’) is ultimately responsible and
accountable for the oversight and management of Shariah matters in the operation of the Group’s Islamic
banking and finance activities. In undertaking its duties and responsibilities relating to Shariah, the Board
relies on the advice of the Board Shariah Committee of CIMB Group Holdings Berhad that is established
under its core Islamic operating entity, CIMB Islamic Bank Berhad (“CIMB Islamic”).

The main responsibility of the Board Shariah Committee is to assist Z A K AT O B L I G AT I O N S

the Board in the oversight and management of all Shariah matters
relating to the Islamic banking and finance business of the CIMB CIMB Islamic Bank Berhad pays business zakat by adopting the
Group Holdings Berhad. The Board Shariah Committee operates on Adjusted Growth Method to state zakat authorities in line with the
the authority as delegated and empowered to it by the Board and as methodology approved by Board Shariah Committee. However, the
attributed to it under relevant financial regulations and legislations. amount payable by the CIMB Islamic Bank Berhad is at the
discretion of the management of CIMB Islamic Bank Berhad and it
All decisions by the Board on Shariah matters relating to the Islamic is the shareholder's responsibility to ensure that their own zakat
banking business of CIMB Group Holding Berhad shall be made obligation are fulfilled in relation to their ownership of the share.
based on the decisions, views and opinions of the Board Shariah
Committee. If the Board disagrees with any decisions, views, and For the Group’s banking and asset management subsidiaries, the
opinions of the Board Shariah Committee on any Shariah matter, obligation and responsibility for payment of zakat on deposits and
the former shall refer back the matter to the latter for a second or investments received from their customers lies with their respective
third review before final decision is made. All and any final decision Muslim customers only. The aforesaid is subject to the jurisdictional
of the Board on Shariah matter shall be made based on the final requirements on zakat payment as may be applicable from time to
decisions, views and opinions of the Board Shariah Committee. All time on the Bank and its subsidiaries arising from changes to local
decisions of the Board and the Board Shariah Committee on legislation, regulation, law or market convention as the case may
Shariah matters shall at all times be subordinated to the decision of be. Accrual of zakat expenses (if any) in the Financial Statements of
the Shariah Advisory Council of the relevant Malaysian financial the Group is reflective of this.
regulators and shall take into consideration the relevant authority on
Shariah matters in the relevant jurisdiction it is doing business.

The Board Shariah Committee shall at all times assist the Board to B OA R D S H A R I A H C O M M I T T E E ’ S R E P O R T
ensure that the Group’s Islamic banking and finance business does
not have elements/activities which are not permissible under Shariah. In the name of Allah, the Most Beneficent, the Most Merciful.

The members of the Board Shariah Committee are as follows: We, the members of the CIMB Group Board Shariah Committee as
established under CIMB Islamic Bank Berhad (“CIMB Islamic”), are
1. Professor Dr. Mohammad Hashim Kamali (contract of responsible to assist the Board in the oversight and management of
appointment expired on 13 June 2019) Shariah matters in the operation of the Group’s Islamic banking and
2. Dr. Nedham Yaqoobi finance activities. Although the Board is ultimately responsible and
3. Dr. Shafaai Musa accountable for all Shariah matters under the Group, the Board
relies on our independent advice on the same.
4. Professor Dr. Yousef Abdullah Al Shubaily
5. Associate Professor Dr. Aishath Muneeza Our main responsibility and accountability is to assist the Board in
6. Ahmed Baqar Rehman (appointed on 1 June 2019) ensuring that the Group’s Islamic banking and finance businesses
7. Dr. Ahmad Sufian Che Abdullah (appointed on 1 November does not have elements/activities which are not permissible under
2019) Shariah. In undertaking our duties we shall follow and adhere to the
decisions, views and opinions of the Shariah Advisory Council of
The Board hereby affirms based on advice of the Board Shariah the relevant Malaysian financial regulators for businesses
Committee that the Group’s Islamic banking and finance operations undertaken in Malaysia and for businesses outside Malaysia we
has been done in a manner that does not contradict with Shariah shall take into consideration the decisions, views and opinions of
save and except for those that have been specifically disclosed in this the relevant authority on Shariah matters (if any, sanctioned by law/
financial report (if any). This affirmation by the Board is independently regulation to be followed by the Bank) in the relevant jurisdiction
verified and confirmed by the Board Shariah Committee in a separate that the Group is doing business.
Board Shariah Committee Report made herein.

142
As members of the Board Shariah Committee, we are responsible All in all, the Management of the Group is responsible and
to provide an independent assessment and confirmation in this accountable to the Board to ensure that the Islamic banking and
financial report that the operations of the Islamic banking and finance businesses of CIMB Group are done in accordance with the
finance business of CIMB Group have been done in conformity with requirement of Shariah. It is our responsibility to form an
Shariah as has been decided and opined by us and with those independent opinion of the state of Shariah compliancy of the
Notices, Rules, Standards, Guidelines and Frameworks on Shariah business and its operations and advise the Board accordingly.
matters as announced and implemented by relevant financial Based on the internal controls that have been put in place by the
regulators in the relevant jurisdictions that the Group’s Islamic Management, in our opinion, to the best of our knowledge, the
banking and finance businesses were undertaken during the period Group has complied with the Shariah rulings issued by the Shariah
being reported. Advisory Council of Bank Negara Malaysia and by all other financial
regulators (where relevant), as well as Shariah decisions made by
Our independent assessment and confirmation has been used as us (excluding PT Bank CIMB Niaga Tbk) except for the following
the basis for the Board’s affirmation of the same in the Director’s incident of Shariah non-compliance event within the Group:
Report herein before. i) Shariah Non Compliance reward was offered to CIMB Islamic
customers pursuant to a marketing campaign.
In making our independent assessment and confirmation, we have
always recognised the importance of CIMB Group maintaining and In our opinion:
reinforcing the highest possible standards of conduct in all of its
1. The contracts, transactions and dealings entered into by the
actions, including the preparation and dissemination of statements
Group during the financial year ended 31 December 2018 that
presenting fairly the Shariah compliant status of its Islamic banking
were presented to us were done in compliance with Shariah;
and finance businesses.
2. The allocation of profit and charging of losses relating to
In this regard sufficient internal controls are in place to ensure that investment accounts conformed to the basis that were
any new Islamic financial transaction is properly authorised; the approved by us in accordance with Shariah;
group’s assets and liabilities under its statements of financial 3. There were no earnings that were realised from sources or by
position are safeguarded against possible Shariah non-compliance; means prohibited by Shariah have been considered for
and, that the day to day conduct of its operations does not disposal to charitable causes; and
contradict Shariah principles. 4. The zakat calculation is in compliance with Shariah principles.
In addition to the necessary policies and procedures, the Bank has We have actively monitored and overseen the independent work
a well-defined division of responsibility and guidelines of business carried out for Shariah review and Shariah audit functions by the
conduct to all staff. relevant functionaries under the established system of internal
control, which included the examination, on a test basis, of each
Effective Shariah governance is supported by a professional staff of type of transaction, of relevant documentation and procedures
Shariah researchers as well as the advisory and consultancy adopted by the Group. We are satisfied that the Management has
function that supports us in our decision and deliberations, planned and performed the necessary review and audit so as to
providing check and balance for all Shariah matters as presented to obtain all the information and explanations which are considered
us by the Management. CIMB Group Shariah Review Policy and necessary to provide us with sufficient evidence to give reasonable
Procedures were established to set out policies for Shariah review assurance that the Group has not violated Shariah.
function encompassing regular examination and evaluation of the
Bank’s level of compliance to the Shariah requirements, remedial We, the members of the Board Shariah Committee, are of the
rectification measures to resolve non-compliances and control opinion that the operations of the Group for the financial year ended
mechanisms to avoid recurrences. In addition, the Shariah Review 31 December 2019 were conducted in conformity with Shariah
Procedures sets out the procedures for Shariah review execution, except for what has been disclosed.
responsibilities of stakeholders and internal reporting process
relating to Shariah non-compliance events, in line with BNM’s
requirements. On behalf of the Board Shariah Committee
In ensuring that the activities and operations of CIMB Group are
Shariah-compliant, Shariah Review conducts post review of CIMB
Group’s activities and operations in accordance with the annual
Shariah review work plan approved by us and the respective
Dr. Shafaai Musa
Boards of Directors of CIMB Group. Additionally, Shariah Review
Chairman
conducts investigations on issues escalated by the stakeholders
and performs ad-hoc review as required from time to time by us
and the regulators. As for effective risk management and control,
the Group adopted the strategic implementation of tiered model i.e.
Three Lines of Risk Defense in governing and managing Shariah
Associate Professor Dr. Aishath Muneeza
Non-Compliant risk. Lastly, there is also a team of internal auditors
Member
who conduct periodic Shariah audits of all the Group’s Islamic
banking and finance operations on a scheduled and periodic basis.
Kuala Lumpur
1 March 2020

143
sustainability
For details and comprehensive information, please refer to the full version of
the CIMB Sustainability Report 2019

FORWARD: ASEAN’S SUSTAINABLE BANKING BEYOND STANDARDS: AN ACCURATE ACCOUNT TO

AGENDA STAKEHOLDERS

#CIMBforTomorrow is our commitment to Beyond standards, our intent has been to provide
stakeholders. It is about our efforts to preserve invaluable stakeholders with accurate and reliable information
natural and social capital. It is also our endeavour to create on our sustainability performance and aspirations.
value for all stakeholders through net positive economic, Our motivation is to inspire sustainable action, forge new
environmental and social (EES) impact. partnerships for sustainable development, and create a
community of sustainability champions. The Sustainability
In the conduct of business, we assume full responsibility for Report 2019 adheres to the following best practice
our actions. 2019 was year one of our first 5-year sustainability guidelines, standards and frameworks.
Sustainability Roadmap. It was a year for us to build the
right foundation to anchor our five sustainability pillars or Bursa Malaysia’s Main Market Listing Requirements on
focus areas. CIMB's near-term objectives have been to Sustainability Reporting.
raise awareness, build capability, garner support
from our network of stakeholders, and motivate “In Accordance” with GRI Standards: Core Option.
action. The successful outcomes of these objectives
significantly contribute to CIMB's EES performance. In the United Nations Environment Programme Finance
mid to long-term, the aspiration is to influence, shape Initiative Principles for Responsible Banking
and FORWARD the sustainability agenda in ASEAN. (UNEP FI PRB).

Dow Jones Sustainability Index (DJSI).

BUSINESS CASE: PROFITS WITH PURPOSE SCOPE: REPORTING COVERAGE AND PRINCIPLES
This year’s sustainability report focuses on the The 2019 scope for our annually published CIMB
business case for sustainability. It is a transparent Sustainability Report includes information for the period
account of stakeholders’ expectations and our 1 January 2019 to 31 December 2019, primarily for
commitments. It serves as a credible reference document Malaysia unless Indonesia, Singapore, Thailand, and
on the adoption and implementation of sustainability Cambodia are indicated. This statement is a summary of the
principles, and draws a clear picture of where CIMB is in its full report.
sustainability journey.
All quantitative and qualitative information for relevant
The CIMB Group Sustainability Report 2019 documents an indicators has been disclosed for a minimum of two years
important shift in the way we approach business. From where applicable. The last report was published in March
shareholder returns to stakeholder expectations – we 2019 for the period covering 1 January 2018 to 31
are shifting in our mindsets. We are committing to December 2018.
create value for all. We are working to mobilise definitive
action today, to create a better tomorrow for everyone who Where possible, we have remained true to the principles of
is associated with us. balance, comparability, clarity, completeness,
reliability and accuracy.

F E E D B AC K L O O P S : R E V I E W F O R C O N T I N U O U S I M P R OV E M E N T

We look at sustainability as our responsibility towards our stakeholders and their future. It is
therefore critical to continuously map their views on our sustainability efforts. It is equally CIMB Sustainability Report 2019
important to seek their participation in creating long-term positive impact in areas that matter
most to them. Our assurance to our stakeholders is to keep their interests at the core of
everything that we do. The motivation is to shape a better tomorrow for all of us. We encourge
our stakeholders to access and read our full CIMB Sustainability Report 2019 and submit
feedback, ideas, and questions on our programmes and performance. Please contact:
[Link]
Luanne Sieh sustainability/[Link]
Head, Group Sustainability
sustainability@[Link]

144
RELIABILITY: ASSURANCE OF THE QUALITY OF REPORTING

We continuously discuss and deliberate on the level of transparency and accountability in reporting across various
functions of the Group. This positively contributes to improving the quality of our report, in terms of presenting information in a
balanced, meaningful and accurate manner.

Selected reported information for topics material to CIMB are subject to a limited independent assurance by KPMG.
For scope of work and observations, please refer to the full assurance statement on pages 146 - 148 of the Sustainability Report 2019.

STAKEHOLDER INCLUSIVENESS: STAKEHOLDERS’ EXPECTATIONS AND MATERIALITY

We have committed to use our relationships to influence our ASEAN-wide network of stakeholders to adopt and integrate sustainable
business practices.

The stakeholders’ influence on our business, interactions, reputation;

Our basis for

selecting the most The degree or level of our dependency on various stakeholders on our business; and
critical stakeholders
considers three
factors The stakeholders who share common business and community interests and aspirations, or their
representativeness.

Stakeholder Engagement Process

Engage various Source stakeholder data Seek stakeholder Review our current
stakeholder groups from multiple internal feedback every three to portfolio and sectoral
through focus groups, one- sources and stakeholder five years via focus groups, focus to better understand
on-one interviews and touchpoints, including in-depth interviews, and our ability to create direct
online surveys to bank branches, surveys, surveys. In 2019, we and indirect impact, both
understand specific townhalls, review updated the topics of by way of reducing
sustainability issues relevant meetings, briefing sessions interests through an negative impact and
to them, and identify topics etc. assessment of creating positive impact.
of interest to stakeholders. stakeholders' expectations
from various internal
touchpoints and feedback
loops. These however
remain aligned to our
material topics.

145
sustainability statement

In the table below, we have listed our most critical stakeholders, the various platforms we rely on to bridge and strengthen
our relationships and some of the key topics that interest our stakeholders.

Stakeholders' Topics of Interest

Topics of Interest

• Consistent and Superior Customer

Experience
• Enhanced Digital Services
Banking Call centres Feedback forms • Financial Education
Customers distribution and surveys • Financial Inclusion
channels • Green Education and Participation
Basis for Selection
• Data Security
• Dependency
• Access to Finance
• Influence
Material Topics:
Social media Seminars &
Customer Experience; Technology; Financial
conferences
Literacy, Inclusion, and Well-being;
Sustainability Education and Participation.
Frequency of Engagement – Daily

• Access to Finance
• Favourable Lending Terms
Banking distribution Call centres
• Customer Experience
channels
Clients Material Topics:
Corporate/Commercial Sustainable Finance; Customer Experience

Basis for Selection Seminars & Meetings

• Dependency conferences (Quarterly)
• Impact
Frequency of Engagement – Daily

• Leadership by Example - Corporate

Values and Culture
Townhalls Informal Department • Fair Remuneration and Benefits
meetings meetings • Grievance Mechanisms
• Financial Literacy
Employees • Talent Development and Talent Mobility
• Sustainability
Basis for Selection
• Dependency Feedback Community Intranet/Newsletter/
surveys events Internal Material Topics:
• Influence Communications Nurturing Growth; Talent Attraction, Growth,
and Retention; Corporate Culture; Diversity
and Inclusion; Corporate Citizenship and
Volunteerism; Sustainable Finance; Health,
Complaints and feedback Focus Safety and Well-being
mechanism in offices groups

Frequency of Engagement – Daily

146
 • Partnerships for Growth
• Fair Remuneration and Payment Terms
• Grievance Mechanisms
Procurement process Community events
• Financial Literacy
Suppliers • Community Development

Basis for Selection Material Topics:

• Dependency Performance evaluation Focus groups Sustainable Supply Chain; Governance;
Sustainability Education and Participation;
Frequency of Engagement – Monthly Nurturing Growth

• Governance
• Sustainable Finance
• Sustainable Supply Chain
• Sustainability Education and Awareness
Government • Financial Inclusion
and Regulators Meetings Seminars • Quality EES Reporting / Communication
• Value-based Intermediation
Basis for Selection • Customer Experience
• Dependency • Treating Customers Fairly
• Talent Development
• Influence
• Climate Change

Material Topics:
Other forms of Governance; Customer Experience;
Interviews
communication Technology; Financial Literacy, Inclusion, and
Well-being; Sustainability Education and
Participation; Financial Literacy, Inclusion,
and Well-being; Sustainability Education and
Frequency of Engagement – Quarterly Participation; Climate Change; Sustainable
Finance; Sustainable Supply Chain

• Partnerships for Growth

• Financial Inclusion
• Volunteerism
Community/NGOs/
• Financial Literacy
Civil Society Community Social media Focus
• Community Development
partnerships and (Ongoing) groups
investments, • Climate Change
Basis for Selection including
• Dependency donations Material Topics:
• Influence Financial Literacy, Inclusion, and Well-being;
Climate Change; Corporate Citizenship and
Frequency of Engagement – Monthly Volunteerism; Nurturing Growth

• Quality EES Reporting / Communication

• Sustainable Finance
• Sustainable Supply Chain Practices
Investors
• Governance (Corporate and Sustainability
Governance)
Basis for Selection Briefings Meetings • Climate Change Strategy
• Influence
Material Topics:
Sustainable Finance; Governance; Sustainable
Frequency of Engagement – Quarterly, Annual Supply Chain; Climate Change

147
sustainability statement

Materiality & Prioritisation

Based on the in-depth stakeholder engagement and materiality assessment exercise undertaken in 2018, below is our Materiality
Matrix. These material topics have been finalised based on their expected impact, either through our operations, clients
or other business relations.

To further prioritise and address the material topics strategically, we have evaluated them based on the following:

• The material relevance to stakeholders

• Influence on stakeholders’ assessments and decisions
• The significance of CIMB’s economic, environmental, and social impacts

High
Highly Material
Issues

Customer
experience

Economic
Importance to Stakeholders

Sustainable
finance
Governance
Technology
Environmental

Nurturing growth
Social

Talent attraction, growth & retention

Corporate culture
Governance
Financial literacy, inclusion and well-being

Sustainability education & participation

Sustainable supply chain

Important
Matters Health, safety & well-being

Diversity & inclusion Climate change (direct footprint)

Corporate citizenship & volunteerism

Low

Low Significance of CIMB’s EES Impacts High

List of 6 Highly Material Issues: List of 8 Important Topics:

1 Customer Experience 1 Corporate Culture

2 Sustainable Finance 2 Financial Literacy, Inclusion and Well-Being
3 Technology 3 Sustainability Education and Participation
4 Governance 4 Sustainable Supply Chain
5 Nurturing Growth 5 Health, Safety and Well-Being
6 Talent Attraction, Growth and Retention 6 Climate Change (Direct Footprint)
7 Diversity and Inclusion
8 Corporate Citizenship and Volunteerism
148
 OUR PHILOSOPHY

Our philosophy for business goes beyond short-term profits. With a rich legacy of over four decades, CIMB Group continues to be a
progressive financial institution, fulfilling not only the expectations of our stakeholders today, but safeguarding the needs of future
generations.

Our core business of banking aspires to fulfil the promise of a better future, where economic growth empowers people and
businesses, creates new opportunities, and reduces social inequalities. With sustainable banking practices, we operate to achieve growth
that is meaningful for everyone who shares this vision.

This also means that we acknowledge the impacts of our business as well as our people on the planet as well as society.
Our commitment is to operate in a way where we assume accountability and responsibility towards our actions, while minimising negative
impacts and creating net positive impact. In short, our promise of a better future inspires us to optimise our capabilities,
resources, and influence for creating positive economic, environmental and social impact.

OUR
BUSINESS
CASE At CIMB, we believe that our positive sustainability performance will not only give us strategic
advantage and differentiation, but will future-proof our organisation and our people. The driving force
behind all sustainability efforts is our business case as follows:

Stakeholders’ Customers’ Trust ESG Integration Employees’ Sustainability

Expectations on in the Company for Enterprise and Opting for Leadership in
Responsibility and its Offerings Shareholder Value ESG-compliant ASEAN
Companies

84% of asset There is a positive Economic, About 70% of Need for definitive
owners are correlation environmental, millennials action and
pursuing or between brand social and surveyed would leadership to
actively integrating relationship and governance risks consider staying catalyse adoption
ESG factors in consumer and related issues for a long term if of ESG principles,
their investment behaviour, where have had a the company has policies, and
process1 consumers are measurable a strong programmes.
willing to pay more impact on sustainability
for sustainable companies’ plan.2
brands. market value and
reputation.

Sources: 1. Morgan Stanley Institute for Sustainable Investing and Morgan Stanley Investment Management (2018)
2. Fast Company (2019)

149
sustainability statement

We consider both VALUE and VALUES

when embedding sustainability principles into our business model.

Value Preservation Moral Responsibility

We endeavour to identify and mitigate We believe ‘Sustainability’ is the right
environmental and social risks across thing to do and we have a moral
the bank, including our products and responsibility as a corporate citizen.
services, customers, business practices,
human capital management, and our value
VALUE
chain partners. VALUES
Value Creation Fiduciary Obligation & Beyond
Our ultimate objective is to both catalyse Beyond corporate responsibility, we have to
and create positive impact in terms of demonstrate the right leadership
profits, people, and our planet, for CIMB as through governance at the highest level.
well as our multiple stakeholders in markets
and communities where we operate.

Our aspiration towards 2023 is to The United Nations Our

become a visible ‘shaper’ of Common Future, also
sustainability practices in the ASEAN known as the ‘Brundtland
community. Our actions today will Report’, defines
determine how the future will look like, and sustainability as
whether the generations of tomorrow will be “…meeting the needs of
grateful for the world we leave behind for the present without
them. compromising the ability of
future generations to meet
#CIMBforTomorrow is our pledge for their own.”
the future and to ensure the
sustainability of the planet. By reducing
our negative environmental and social
impacts and increasing our positive impacts,
we are committed to create net positive
change for our planet, our people, and for
progress, ensuring a better tomorrow.

Thank You from Tomorrow video.

Follow us on social media #CIMBforTomorrow

150
 S U S TA I N A B I L I T Y R OA D M A P 2 0 2 3

We broadly focus on two key objectives. The first is to create positive impact and opportunities through our business, operations,
relationships and networks. The second is to manage and mitigate negative impacts and risks through partnerships, capacity building,
policy influence and action. In alignment with the Group’s business strategy, the Sustainability Roadmap 2023 focuses on five
key areas as follows.

Governance and Risk

THE GROUP OUR CLIENTS SOCIETY
How we govern and report sustainability risks at CIMB,
Sustainable Action Sustainable Business Corporate Social including setting targets and tolerance levels, and how
Responsibility we organise and mobilise ourselves for best results
How we embed sustainability How we generate profits
principles in all our business in a responsible manner, How we use a portion of
operations and processes to creating net positive impact our profits to enhance
reduce our negative impact through the products and and contribute towards Stakeholder Engagement and Advocacy
such as carbon footprint and services we provide, and by sustainable long-term
generate positive impact assisting and encouraging positive impacts in the How we champion, engage, build capability and
through our business our customers and clients communities around us capacity, raise awareness and drive participation for
on their own sustainability sustainability, both internally and externally
journeys

MATERIAL MATTERS BY FOCUS AREAS OF OUR SUSTAINABILITY ROADMAP AND THEIR IMPACT
(ECONOMIC, ENVIRONMENTAL, SOCIAL & GOVERNANCE)

Economic Environmental Social Governance

SUSTAINABLE ACTION

Climate Change Health, Safety and Well-being Sustainable Supply Chain

Talent Attraction, Growth and Retention Diversity and Inclusion Nurturing Growth

151
sustainability statement

SUSTAINABLE BUSINESS

Customer Experience Sustainable Finance Technology

Financial Literacy, Inclusion & Well-being

CORPORATE SOCIAL GOVERNANCE & RISK

RESPONSIBILITY

Governance
Corporate Citizenship & Volunteerism

Corporate Culture

STAKEHOLDER ENGAGEMENT & ADVOCACY

Sustainability Education and Participation

152
 P R I O R I T Y S U S TA I N A B L E D E V E LO P M E N T G OA L S ( S D G s )

All our sustainability efforts, programmes and initiatives, performance tracking, and impact reporting in relation to the
above focus areas are structured and designed to meet specific targets of the following seven priority SDGs.

O u r F o c u s To w a r d s 2 0 2 3
Impact
Direct
Indirect
Impact

The following factors were taken into consideration when prioritising SDGs,
in alignment with our focus areas and business impact.

04 01
National Priorities Material Topics
Government, regulatory An aggregate of what is
and sectoral focus areas important to both CIMB and
and priorities. its stakeholders.

Factors
considered to
prioritise
SDGs
03 02
Client Impact Own Impact Scores
The impact our Commercial Our direct impact through our
and Corporate Clients can own practices, procurement,
potentially have through hiring, products, individuals,
activities we finance. customers and others.

153
sustainability statement

S U S TA I N A B I L I T Y S C O R E CA R D

In consultation with the Group Sustainability Council, we have determined our preliminary indicators of measuring impact for the
5-year Sustainability Roadmap 2023. A comprehensive target-setting exercise based on all the five pillars (below) is currently in
progress. Meanwhile, our aspiration is to progressively demonstrate sustainability leadership across ASEAN. Below is the table with
preliminary indicators:

Sustainable Action
• Reduction in GHG emissions for Scope 1 and 2 across CIMB Group (%)
• Gender pay gap (across all Job Categories)
• Number of suppliers engaged on sustainability topics
• Employees who are upskilled/reskilled (%)
• Percentage of Digital, Data, Design workforce (%)

Sustainable Business
• CIMB Financing Clients with Environmental and Social (E&S) Actions Plans (%)
• Clients with E&S Action Plans that implemented them (%)
• Percentage of book in Sustainable Business (%)
• Number of people from underserved communities served (counselling,
advisory, training)
• Positive Treating Customer Fairly Perception
• Net Promoter Score

Corporate Social Responsibility

• Funds channelled towards high social and environmental impact programmes (%)
• Number of employees participating in CSR programmes

Governance and Risk

• Material issues supported by policy commitments (%)
• Improvement in Governance-related scores on
Dow Jones Sustainability Index (%)
• Female representation on the Board and in Key Management positions (%)

Stakeholder Engagement and Advocacy

• Number of employees trained/briefed on sustainability issues
• Completion of sustainability e-learning (%)

154
 FIVE FACTORS
UNDERPINNING
SUSTAINABILITY
TARGETS While we have set
UN SDGs internal sustainability
targets to guide various
functions to deliver
positive performance
against each of the five
National Sustainability
Goals Indices pillars of our
Sustainability Roadmap
Programme 2023, we are in the
Targets
process of finalising the
mid-term targets, which
will be published in the
Baseline & Internal
Material Issues
Capability 2020 Sustainability
Report.

The seven UN SDGs prioritised by the Group (as indicated on page 153) and other pivotal SDG indicators will ensure our
alignment to global goals and commitment to local impact in markets where we operate.

The Government’s Strategic Plan, led by the Ministry of Energy, Science, Technology, Environment and Climate Change
(MESTECC), aims to achieve energy sustainability and wealth creation. The plan has 20 initiatives for the energy sector, 22
initiatives for science, technology and innovation (STI) and 20 specific plans for environment and climate change. We also
align ourselves to the 11th Malaysia Plan’s Six Strategic Thrusts that address economic, environmental, social and
governance challenges.

Thrust 1 Thrust 2 Thrust 3 Thrust 4 Thrust 5 Thrust 6

Enhancing Improving Accelerating Pursuing green Strengthening Re-engineering
inclusiveness well-being for all human capital growth for infrastructure to economic growth
towards an development for sustainability and support economic for greater
equitable society an advanced resilience expansion prosperity
nation

The top concerns and issues that are material to our stakeholders as well as to CIMB form the basis for determining
mid-term strategies and approaches, risks and opportunities and key areas of focus for achieving EES impact.

Significant multi-sectoral material issues tracked by global sustainability indices such as DJSI, MSCI, FTSE and
WWF are critical to help our customers and leadership to monitor and manage economic, environmental, social and
governance impact.

Determining the baseline for each indicator and building internal capability to help us measure and achieve our targets.

155
sustainability statement

SUSTAINABLE ACTION
Sustainability is part of our core Forward23 strategy. Sustainable action demonstrated at CIMB speaks of our commitment to
creating positive impacts through our day-to-day business. Our key focus is on promoting sustainable practices in our operations
and processes group-wide. Over the last one year, we have achieved significant milestones and made commitments to initiate tangible
steps towards addressing sustainability challenges facing our organisation, and its stakeholders.

At CIMB, we recognise the urgency. Our mid-term strategy on sustainability takes into account how our business (including the
supply chain) will continue to be impacted by the global phenomenon of climate change. We also understand the role of our
people in championing definitive action to mitigate negative impacts and create positive change within our circles of influence as well as the
communities where we operate. The role of people and their mix is also critical for our business performance. According to the Global
Diversity Practice, Diversity widens access to the best talent, whereas Inclusion allows organisations to engage with talent effectively.
Together, Diversity and Inclusion lead to enhanced innovation, creativity, productivity, reputation, engagement, and results. At CIMB,
we do believe that a healthy balance of gender, age, and ethnicity improves decision-making and gives us a business advantage.

HOW DO WE MAP SUSTAINABLE ACTION?

Material Topics Key Considerations Sustainable Development

Goals (SDGs)

• What represents the highest percentage

of our carbon footprint?
Climate Change • What are the projects designed or
supported to mitigate the internal
effects of climate on the environment
and communities who matter to us?
Sustainable Supply Chain • What motivates our people and how do
we future-proof our people?
• What drives performance and growth
for both our employees and the
Diversity and Inclusion organisation?
• What tangible actions can we take to
promote diversity and inclusion in our
business?
Health, Safety and Well-being

Talent Attraction,
Growth and Retention
Relevent Strategic Pivots

Nurturing Growth

Our People Technology Ventures & Sustainability

& Data Partnerships

156
SUSTAINABLE ACTION: PERFORMANCE HIGHLIGHTS 2019

4,434.4 tCO2e 88% 819 suppliers

Direct (Scope 1) GHG Local supplier base A 25% increase in
Emissions in Malaysia, (Malaysia) suppliers registered in our
Indonesia, Singapore and Group Electronic
Thailand (MIST) Procurement Systerm
40% (GEPS) (Malaysia)
Spends on suppliers having stronger
CSR and/or sustainability orientation
73,377.5 tCO2e
RM945 million
Energy Indirect (Scope 2)
GHG Emissions in MIST 50
Total disbursement to suppliers Procurement governance
(Malaysia) engagement sessions, involving

700
11% internal stakeholders and

48.6%
Female representation on 4 divisions and 42 departments
the CIMB Board of CIMB
Employees covered by a
trade union or collective
bargaining agreement
(Malaysia)
43.9%
Female representation in senior
management 11,389
Employees participated in 3D Academy
programmes from Malaysia, Indonesia, RM141 million
Singapore, Thailand and Cambodia Total investment in training
49 Total People with and development
Disabilities (PWDs) Employed
(Malaysia, Indonesia & Thailand)
32%
Recipients of CIMB ASEAN

Male Female
Scholarships are pursuing STEM
courses in fields such as Engineering,
18 Computer Science, Actuarial Science
and Mathematics
68.7 72.3
Total number of OSH Average training hours per
training sessions employee
(Malaysia)
13 Scholars
CIMB ASEAN Scholarship
430 98.9%
Total number of employees trained
in OSH 48 New Talent Average e-learning
completion rate
(Malaysia) The Complete Banker™ programme

157
sustainability statement

SUSTAINABLE BUSINESS
Business can be a force for good. Key to this is to understand what sustainability means in the context of both business and
stakeholders. Aligning business priorities with stakeholders’ expectations is always the starting point. Over the last two years, we have
started to take an outside-in orientation on business i.e., from stakeholders’ perspectives. We are also working to reconcile the gaps, and
change the way we measure our impact, our success and our stakeholder relationships.

Today, we are mindful of how we generate business profits in a responsible manner. Our objective is to create net positive impact
through our products and services. In the process, our long-term approach is to inspire and encourage our customers to
contribute to sustainable business, by embracing sustainability principles and practices.

HOW DO WE MAP SUSTAINABLE BUSINESS?

Material Topics Key Considerations Sustainable Development

Goals (SDGs)

• Who are using our products and

services and how?
Customer Experience • How do our products and services
cater to underserved communities?
• How do we ensure fair and equitable
treatment of our customers?
Sustainable Finance • Which are the sectors that we fund and
what is our environmental and social
impact along the value chain?
• How do we contribute to the greater
Technology agenda of financial well-being?
• How do we create positive impacts on
the environment and communities
through our products and services?
Financial Literacy, Inclusion
& Well-being

Relevant Strategic Pivots

Customer Technology & Our People Ventures Sustainability

Centricity Data & Partnerships

158
SUSTAINABLE BUSINESS: PERFORMANCE HIGHLIGHTS 2019

Net Promoter Score Total number of CIMB Clicks accounts

top 48% RM3.3 million RM1.9 million
among comparables in Malaysia* Indonesia
MIST - General Retail
Banking
Total number of mobile app users

RM2.0 million RM2.6 million

RM6.0 Malaysia* Indonesia
* active users only

million
12,917
investment in Be$MART
financial literacy
programme Afflicted customers who benefited from our Rescheduled/Restructured
Loan arrangements and/or Compromised Settlements, easing their
>16,000 financial burden and reducing their risk of default, and maintaining their
credit score/worthiness (Malaysia)
Students benefited from Be$MART
financial literacy programme
over three years

Be$MART
Mobile application launched to 804
promote financial literacy Micro debtors
among youth RM5,698 financed in Indonesia, where

million 57.8%
New financing to B40 communities were women-run businesses

18,000 RM174.57 million

SME owners participated in over
700 sessions on diverse topics, Total loan draw down since 2016 for affordable housing as part of
including big data, e-commerce, PR1MA end-financing for low-income groups (as at end 2019)
credit management and
forex hedging

>1,000
SMEs benefited from seminars on
digitalisation of business

4 4 million
12 Sector guides introduced on E&S risks
e-wallet users registered for
Industry Awards for
Customer experience and
44 Touch ‘n Go e-wallet app, a
5,000% increase in 11 months
Number of clients screened on
excellence
ESG risks

159
sustainability statement

CORPORATE SOCIAL RESPONSIBILITY

Transformative CSR catalyses meaningful development. For more than a decade, CIMB Foundation has been instrumental in
championing causes which matter to the communities where we operate. From financial literacy to gender empowerment, and
entrepreneurship to environmental stewardship, we continue to focus our efforts on identifying issues that impede socio-economic
development of people who matter to us in all our markets. It is our mission to help communities prosper and positively contribute to
shaping a better planet for future generations.

HOW DO WE MAP CORPORATE SOCIAL RESPONSIBILITY?

Material Topics Key Considerations Sustainable Development

Goals (SDGs)

• How do we instill new skills that can

improve income potential, employability
Corporate Citizenship & and competitiveness/competencies of
Volunteerism employees, youth, women and SMEs?
• How do we impart knowledge that can
improve health and productivity as well
as performance of employees and
community members?
Relevant Strategic Pivots • How do we provide a springboard for
women, youth, SMEs, and seek
meaningful participation of our
stakeholders including employees,
partners, suppliers, and customers in
driving projects with socio-economic
benefits?
Sustainability

CORPORATE SOCIAL RESPONSIBILITY: PERFORMANCE HIGHLIGHTS 2019

RM17.0 million RM11.1 million

1,170 spend on Natural Disaster & General
Donations/Others spend on Education
CIMB Volunteers contributed

6,580
hours to support 68 projects,
benefiting more than 40,000
community members

RM11.1 million RM6.6 million

40,000 spend on Community Development spend on Sports
Total number of beneficiaries
(CIMB Foundation)
RM45.8 million
Total regional CSR spend

160
 GOVERNANCE & RISK
It is our responsibility to uphold a high standard of corporate governance. Effective corporate governance is pivotal to preserving
the banking ecosystem and the economy as a whole.

HOW DO WE MAP GOVERNANCE AND RISK?

Material Topics Key Considerations Sustainable Development

Goals (SDGs)

• Transparency through disclosures

• Number of new policies, procedures
Governance and frameworks introduced/revised to
address material issues
• Feedback and grievance mechanisms
• Reported cases/issues on material
Corporate Culture topics

GOVERNANCE & RISK: PERFORMANCE HIGHLIGHTS 2019

Dow Jones Sustainability Index (DJSI)

Corporate Assessment (2019) 6/6
Highly material issues supported by
83/100 69/100 policy commitments
Risk & Crisis Management Anti-crime Policy & Measures
5/8
63/100 51st Percentile Important material topics supported
Codes of Business Conduct Ranking on DJSI by policies and programmes
(up from 19th percentile in 2018)

33% 11% 25%

Active Board members in
Female representation on Female representation in
non-profit social/
the Board Key Management
environmental organisations

161
sustainability statement

STAKEHOLDER ENGAGEMENT AND ADVOCACY

Systematic engagement is fundamental to understanding stakeholders’ needs, while advocacy creates consensus and an
ecosystem of support and change. While it is critical to analyse, understand and respond to the evolving expectations, needs, and issues
of the priority stakeholders, it is equally important to reach-out to our employees, peers, clients, policymakers, regulators, as well as the
government to advocate principles and programmes that will positively contribute to greater impact. The primary objective however for all
engagement should be to not just raise awareness, but to mobilise support for enabling meaningful actions towards sustainable development.

At CIMB, over the past one year, we have invested our resources and time to first raise our level of engagement with internal stakeholders
across the Group, mainly to orientate our employees in different functions on sustainability, sustainable finance, and sustainable
development. We also extended our engagement efforts to include important stakeholders outside the organisation, initiating dialogue and
deliberations with suppliers, clients, regulators, industry associations, government officials and business leaders on catalysing growth with
responsibility towards our environment as well as our people.

HOW DO WE MAP STAKEHOLDER ENGAGEMENT AND ADVOCACY?

Material Topics Key Considerations Sustainable Development

Goals (SDGs)

• Enculturation of internal stakeholders

and their sustainability orientation
Sustainability Education • Sustainability-related engagements with
and Participation with external stakeholders
• Industry and stakeholder outreach,
awareness, and advocacy efforts

STAKEHOLDER ENGAGEMENT AND ADVOCACY: PERFORMANCE HIGHLIGHTS 2019

2,268
Number of employees trained/briefed on
sustainability issues
22
Industry peers and financial institutions
engaged on sustainability

7
189 National and international working groups
CIMB Sustainability Champions where CIMB is represented

162
 regional

R E G I O N A L A DV I S O RY D E A L S

Paramount Corporation Berhad

RM38.5 million disposal of Paramount
Corporation Berhad’s controlling interests
in KDU University College Sdn Bhd, KDU
University College (PG) Sdn Bhd and
Lotte Chemical Titan Holding Berhad KDU College (PJ) Sdn Bhd
Divestment of 59,584,000 ordinary shares BlueScope Steel Limited
representing 49% of the issued share RM125.0 million acquisition by NS
capital in PT Lotte Chemical Indonesia by BlueScope (Malaysia) Sdn Bhd, a joint
Lotte Chemical Titan Holding Berhad to venture entity of BlueScope Steel Limited,
Lotte Chemical Corporation for a cash of the coated coil business of YKGI
consideration of USD65,396,955 Holdings Berhad Xinghua Port Holdings Limited
Compliance Adviser to Xinghua Port
Holdings Limited post its listing on the
Main Board of the Stock Exchange of
Hong Kong Limited

REGIONAL EQUIT Y DEALS

AME Elite Consortium Berhad

RM166.6 million (USD39.7 million) IPO of
Sapura Energy Berhad Federal Land Development Authority AME Elite Consortium Berhad on Main
Strategic partnership between Sapura FELDA’s RM308.0 million (USD75.0 million) Market Bursa Malaysia
Energy Berhad (“SEB”) and OMV Maybank block trade
Aktiengesellschaft, through a joint venture
company, SEB Upstream Sdn. Bhd. FELDA’s RM263.8 million (USD63.7 million)
involving:- Maybank block trade

• Issuance of 50% equity interest in SEB

Upstream Sdn. Bhd. for a consideration
Dusit Thani Freehold and Leasehold
of USD625 million
Real Estate Investment Trust
• Repayment of an amount owing of THB1.8 billion Dusit Thani Freehold and
USD350 million to SEB group Leasehold REIT, Rights Offering and
Axis Real Estate Investment Trust Public Offering
Axis REIT’s Follow-on Placement with
Khazanah Nasional Berhad Total Proceeds of RM340.5 million
Khazanah Nasional Berhad’s RM1.1 (USD81.5 million)
billion (USD255.0 million) Tenaga Nasional
Berhad block trade

Aoyuan Healthy Life Group

Pantone 356 C Pantone 186 C BLACK 100%
Process Colour
BLACK 30%
Process Colour
Company Limited
BLACK 60%
Process Colour
BLACK 100%
Process Colour

HKD737.0 million (USD94.0 million) IPO

on the Main Board of the Stock Exchange
of Hong Kong

163
regional notable deal

REGIONAL DEBT DEALS

Khazanah Nasional Berhad

Establishment of an Islamic Medium Term
Notes Programme of up to RM10.0 billion
in nominal value via Danum Capital
Berhad YTL Corporation Berhad
RM500.0 million Medium Term Notes
Penang Port Sdn Bhd
USD500.0 million Guaranteed RM1.0 billion Islamic Medium Term Notes
Exchangeable Bonds via Cerah Programme
Capital Ltd

LLPL Capital Pte Ltd

USD775.0 million Guaranteed Project
Financing Notes PT Sarana Multi Infrastruktur
(Persero)
Genting Berhad via its wholly-owned
IDR1,000.0 billion Mudharabah Sukuk via
subsidiary Genting RMTN Berhad
1st Shelf Registration Programme
RM10.0 billion Medium Term Notes
Tranche II of IDR3,000.0 billion
Programme
CIMB Bank Berhad IDR3,000.0 billion Senior Bonds via 2nd
USD680.0 million Formosa Sustainable Shelf Registration Programme Tranche I
Development Goals Bond of IDR25,000.0 billion

IDR4,096.0 billion Senior Bonds via 2nd

Shelf Registration Programme Tranche II
Top Glove Corporation Bhd of IDR25,000.0 billion and IDR1,000.0
USD200.0 million Guaranteed billion Mudharabah Sukuk via 1st Shelf
LMIRT Capital Pte. Ltd. Exchangeable Bonds via Top Glove Registration Programme Tranche III of
USD250.0 million Guaranteed Senior Labuan Ltd IDR3,000.0 billion
Notes
IDR2,808.3 billion Senior Bonds via 2nd
Shelf Registration Programme Tranche III
of IDR25,000.0 billion

YNH Property Bhd

RCE Marketing Sdn Bhd via RM750.0 million Perpetual Securities
Zamarad Assets Berhad Programme
RM2.0 billion Asset-Backed Securitisation
Sukuk Programme
PT Sarana Multigriya Finansial
(Persero)
IDR2,511.0 billion Senior Bonds via 4th
Shelf Registration Programme Tranche
Sungai Harmoni Sdn Bhd via
VIII of IDR12,000.0 billion
Kuala Lumpur Kepong Bhd Starbright Capital Berhad
RM2.0 billion Islamic Medium Term Notes Issuance of Asset-Backed Medium Term IDR1,850.5 billion Senior Bonds via 4th
Programme Notes of RM665.0 million in nominal value Shelf Registration Programme Tranche VII
of IDR12,000.0 billion

IDR2,000.0 billion Senior Bonds via 5th

Shelf Registration Programme Tranche I
of IDR19,000.0 billion and IDR100.0 billion
Mudharabah Sukuk via 1st Shelf
Registration Programme Tranche I of
IDR2,000.0 billion

164
REGIONAL DEBT DEALS (CONTINUED)

Lembaga Pembiayaan Ekspor

Indonesia PT Semen Indonesia (Persero) Tbk
IDR2,000.0 billion Senior Bonds via 4th IDR4,078.0 billion Senior Bonds via 1st PT Indosat Tbk
Shelf Registration Programme Tranche V Shelf Registration Programme Tranche II of IDR1,500.0 trillion Senior Bonds via 3rd
of IDR26,000.0 billion IDR8,000.0 billion Shelf Registration Programme Tranche I
of IDR7,000.0 trillion and IDR500.0 billion
IDR1,058.6 billion Senior Bonds via 4th
Ijarah Sukuk via 3rd Shelf Registration
Shelf Registration Programme Tranche VII
Programme Tranche I of IDR3,000.0
of IDR26,000.0 billion
trillion
IDR1,661.5 billion Senior Bonds via 4th IDR2,587.0 billion Senior Bonds via 3rd
Shelf Registration Programme Tranche PT Federal International Finance Shelf Registration Programme Tranche II
VIII of IDR26,000.0 billion IDR2,360.3 billion Bonds via 3rd Shelf of IDR7,000.0 billion and IDR794.0 billion
Registration Programme Tranche V of Ijarah Sukuk via 3rd Shelf Registration
IDR1,018.5 billion Senior Bonds via 4th IDR15,000.0 billion Programme Tranche II of IDR3,000.0
Shelf Registration Programme Tranche VI billion
of IDR26,000.0 billion and IDR150.0 billion IDR1,500.0 billion Bonds via 4th Shelf
Mudharabah Sukuk via 1st Shelf Registration Programme Tranche I of
Registration Programme Tranche IV of IDR15,000.0 billion
IDR6,000.0 billion

IDR3,857.0 billion Senior Bonds via 4th

Shelf Registration Programme Tranche IV PT Permodalan Nasional Madani
of IDR26,000.0 billion and IDR441.0 billion (Persero)
Mudharabah Sukuk via 1st Shelf PT Bank CIMB Niaga Tbk IDR2,000.0 billion Senior Bonds via 3rd
Registration Programme Tranche III of Shelf Registration Programme Tranche I
IDR2,000.0 billion Mudharabah Sukuk via
IDR6,000.0 billion of IDR6,000.0 billion
1st Shelf Registration Programme
Tranche II of IDR4,000.0 billion
IDR1,350.0 billion Senior Bonds via 3rd
Shelf Registration Programme Tranche II
IDR1,823.0 billion Senior Bonds via 3rd
of IDR6,000.0 billion
Shelf Registration Programme Tranche I of
IDR6,000.0 billion and IDR83.0 billion
Subordinated Bonds via 1st Shelf
PT Adira Dinamika Multi Finance Tbk
Registration Programme Tranche I of
IDR618.0 billion Senior Bonds via 4th
IDR2,000.0 billion
Shelf Registration Programme Tranche IV
of IDR9,000.0 billion and IDR214.0 billion
PT Waskita Beton Precast Tbk
Mudharabah Sukuk via 3rd Shelf
IDR500.0 billion Senior Bonds via 1st
Registration Programme Tranche III of
Shelf Registration Programme Tranche I
IDR1,000.0 billion
of IDR2,000.0 billion
IDR1,192.0 billion Senior Bonds via 4th IDR1,500.0 billion Senior Bonds via 1st
Shelf Registration Programme Tranche VI Shelf Registration Programme Tranche II
of IDR9,000.0 billion of IDR2,000.0 billion
PT Astra Sedaya Finance
IDR2,225.0 billion Senior Bonds via 4th
Shelf Registration Programme Tranche II of
IDR8,000.0 trillion

PT Bank Tabungan Negara (Persero) IDR1,556.7 billion Senior Bonds via 4th
Tbk Shelf Registration Programme Tranche 3 of PT Bank Danamon Indonesia Tbk
IDR4,144.0 billion Senior Bonds via 3rd IDR8,000.0 billion IDR2,000.0 billion Senior Bonds via 1st
Shelf Registration Programme Tranche II Shelf Registration Programme Tranche I
of IDR5,000.0 billion
of IDR10,000.0 billion

165
regional notable deal

REGIONAL DEBT DEALS (CONTINUED)

PT JACCS Mitra Pinasthika Mustika True Corporation Public Company

PT Mandiri Tunas Finance
IDR2,000.0 billion Senior Bonds via 4th Finance Indonesia Limited
Shelf Registration Programme Tranche II IDR664.0 billion Senior Bonds I THB8.5 billion Senior Unsecured
of IDR3,000.0 billion Debenture

IDR1,000.0 billion Senior Bonds via 4th THB12.2 billion Senior Unsecured
Shelf Registration Programme Tranche I Debenture
of IDR3,000.0 billion
THB22.9 billion Senior Unsecured
Debenture
PT Bank Pembangunan Daerah Jawa
Barat Dan Banten Tbk
IDR248.0 billion Senior Bonds via 1st Shelf
Registration Programme Tranche III of
PT Indonesia Infrastructure Finance IDR3,500.0 billion
IDR1,500.0 billion Senior Bonds via 1st
Shelf Registration Programme Tranche I
of IDR3,000.0 billion Ananda Development PCL
THB4.0 billion Senior Unsecured
Debenture
True Move H Universal
Communication Co., Ltd. THB2.5 billion Senior Unsecured
THB29.5 billion Senior Unsecured Debenture
PT XL Axiata Tbk
Debenture
IDR634.0 billion Senior Bonds via 1st
Shelf Registration Programme Tranche II
THB14.0 billion Senior Unsecured
of IDR5,000.0 trillion and IDR640.0 billion
Debenture
Ijarah Sukuk via 2nd Shelf Registration
Programme Tranche II of IDR5,000.0
billion

TPI Polene Power PCL

Toyota Leasing (Thailand) Co., Ltd. THB4.0 billion Senior Unsecured
THB6.0 billion Senior Secured Debenture Debenture
PT Tower Bersama Infrastructure
THB8.0 billion Senior Secured Debenture
Tbk
IDR750.0 billion Senior Bonds via 3rd THB8.0 billion Senior Secured Debenture
Shelf Registration Programme Tranche III
of IDR7,000.0 billion

R E G I O N A L L OA N SY N D I CAT I O N D E A L S

PT Chandra Sakti Utama Leasing

Kulim (Malaysia) Berhad
Syndicated Term Financing of
Syndicated Term Financing-i Facility of up
USD130.0 million
to RM1.5 billion

166
 notable

MSWG-ASEAN CORPORATE ALPHA SEA BEST FINANCIAL EUROMONEY AWARDS FOR

GOVERNANCE AWARDS 2018 INSTITUTION AWARDS 2019 EXCELLENCE ASIA 2019

• Industry Excellence Award – Finance (1st • Best Cash Management Bank in • Malaysia’s Best Investment Bank
place) Malaysia
• Excellence Award for CG Disclosure (1st • Best Equity House in Malaysia
place) • Best Institutional Broker in Malaysia FINANCEASIA COUNTRY AWARDS
• Excellence Award for Overall CG & 2019
Performance (4th place)
THE ASIAN BANKER EXCELLENCE
• Best Investment Bank – Malaysia
IN RETAIL FINANCIAL SERVICES
• Best DCM House – Malaysia
MALAYSIA E-PAYMENTS AWARDS 2019
• Best ECM House – Malaysia
EXCELLENCE AWARDS (MEEA) 2019
• Best Private Bank – Malaysia
• Best Digital Bank in Malaysia
• Best E-Payment Bank • Best Retail Bank in Malaysia
• Best IBFT Bank • Retail Banker of the Year in Asia Pacific FINANCEASIA HOUSE AWARDS
• MyDebit Market Expansion 2019 – Samir Gupta 2019

• Islamic Finance House of the Year

ALPHA SEA REGIONAL ISLAMIC GLOBAL FINANCE WORLD'S BEST
FINANCE AWARD 2019 ISLAMIC FINANCIAL INSTITUTIONS
AWARDS 2019
ALPHA SEA 13TH DEAL &
• Best Islamic Finance Sukuk House SOLUTION AWARDS 2019
• Best FX Bank for Corporate Islamic • Best Sukuk Bank
Treasury • Best Islamic Trade Finance Provider
• Best Bond House in Southeast Asia
• Best Islamic Bank CSR
• Best Islamic Finance Deal in Southeast
Asia
THE ASSET TRIPLE A ISLAMIC
• Best Islamic ABS-Backed Sukuk
FINANCE AWARDS 2019 NEXT-GEN CUSTOMER
• Best Secondary Deal & Best Convertible
EXPERIENCE IN FINANCIAL
Securities in Southeast Asia
SERVICES AWARDS 2019
• Best Exchangeable Sukuk • Best Refinancing Deal in Southeast Asia
• Best Sovereign Sukuk/Best Green
Sukuk • Excellence Net Promoter Score
• Best Corporate Sukuk • Best Customer Experience – Branch NATIONAL ANNUAL CORPORATE
• Best Unrated Sukuk • Best Customer Experience Business REPORT AWARDS (NACRA) 2019
• Best Local Currency Sukuk Model (Highly Acclaimed)
• Best Islamic Project Finance Deal • Best Use of Customer Feedback (Highly
• Most Outstanding Annual Report of the
• Power Deal of the Year – Malaysia Acclaimed)
Year – Platinum
• Transport Deal of the Year – Malaysia • Best Client On-Boarding Initiative (Highly
• Industry Excellence Awards – Finance
Acclaimed)
• Inclusiveness and Diversity Reporting
• Best Use of Data Analytics (Highly
Award – Silver
Acclaimed)
• Best Designed Annual Report – Gold
• Best Customer Experience – Contact
Centre (Highly Acclaimed)

167
corporate event

3-4 January CIMB 11th Annual Malaysia Corporate Day, Mandarin Oriental 25 February 2019 CIMB Islamic & SimplySiti Press Conference, Menara CIMB
2019 Kuala Lumpur. KL Sentral.

18 February 2019 Chinese New Year Lion Dance Performance, Menara CIMB KL Sentral.

6 March 2019 An Evening with Maher Zain, Hilton Kuala Lumpur. 21 April 2019 CIMB Cycle @ Putrajaya.

168
22 April 2019 CIMB Group’s 62nd Annual General Meeting, Sime Darby
Convention Centre. 23 May 2019 Majlis Berbuka Puasa CIMB Group, Masjid Ar-Rahah.

30 May 2019 CIMB Foundation Hari Raya Shopping with underprivileged

children, Mydin Kuantan. 26 June 2019 CIMB Hari Raya Open House, The St. Regis Kuala Lumpur.

23 July 2019 Konser Kerja Mimpi Untuk Indonesia Jakarta, 23-27 September CIMB Young Asean Leaders, UKM Bangi.
Jakarta Convention Center. 2019

1 & 2 October The Cooler Earth – Sustainable Finance Summit, Plenary

2019 Hall, KLCC. 23 November 2019 The Music Run, KL Sports City (Bukit Jalil Stadium).

169
media

2 October 2019 The Edge Financial Daily

23 April 2019 New Straits Times

8 April 2019 New Straits Times

CIMB Bank
appoints Victor
Lee Meng Teck
21 February 2019 The Sun as Singapore
CEO

2 January 2020 The Edge Markets

26 September 2019 The Edge Financial Daily

25 March 2019 Borneo Post (Kuching)

29 November 2019 New Sabah Times English (KK)

CIMB Cycle 2019

7 January 2019 Borneo Post (Kuching) 11 March 2019 The Edge

CIMB Foundation – CIMB Young ASEAN Leaders

Sharing Session with Tengku Dato’ Sri Zafrul CIMB Islamic and Takaful IKHLAS aim for RM168 million,
Tengku Abdul Aziz 11% YoY growth through strategic partnership

22 April 2019 The Edge Financial Daily

30 September 2019 The Edge Financial Daily 19 August 2019 China Press 26 September 2019 The Edge Financial Daily

170
 CIMB Foundation’s Hari Raya Shopping programme

The Business
18 October 2019 Times
(Singapore)
30 January 2019 New Straits Times 31 May 2019 China Press (East Coast)

#KejarMimpi Leaders Camp Jakarta

27 September 2019 Suara Pembaruan

17 June 2019 The Edge

CIMB Islamic wins Best Islamic Bank at IFN Awards

9 December 2019 Ekonomi Neraca

CIMB Bank PLC Wins Cambodia’s Best

International Bank 2018 Award

25 March 2019 The Edge Financial Daily

1 March 2019 New Straits Times

CIMB Thai announces 2020 strategy

3 January 2019 Sabay

29 April 2019 Berita Harian

26 December 2019 Money and Banking

CGS-CIMB Securities Sdn Bhd commences

operations in Malaysia

22 November 2019 Borneo Post (Kuching)

CIMB Group presents The Music Run

29 April 2019 Kompas

2 July 2019 China Press

19 December 2019 Borneo Post (Kuching) 23 April 2019 New Straits Times 21 June 2019 The Star

171
shareholders’
as at 1 March 2020

Issued and Paid-up Share Capital : RM25,843,808,000 comprising 9,922,966,350 ordinary shares
Class of Shares : Ordinary shares
Voting Rights : One vote per ordinary share

A N A LYS I S O F S H A R E H O L D I N G S ( A S P E R T H E R E C O R D O F D E P O S I T O R S )

No. of % of No. of % of
Size of Shareholdings Shareholders Shareholders Shares Issued Shares

1 – 99 2,948 4.45 99,680 0.00

100 – 1,000 25,036 37.79 11,044,758 0.11

1,001 – 10,000 28,660 43.25 106,214,184 1.07

10,001 – 100,000 7,936 11.98 208,527,773 2.10

100,001 – 496,148,316(*) 1,674 2.53 5,482,176,676 55.25

496,148,317 and above(**) 3 0.00 4,114,903,279 41.47

Director holding 0 0.00 0 0.00

Total 66,257 100.00 9,922,966,350 100.00

Notes:
*¹ Less than 5% of issued holdings.
*² -5% and above of issued holdings.
*³ Less than 0.01%.
*4 Excludes 4,908 shares retained as treasury shares as at 1 March 2020.

A N A LYS I S O F E Q U I T Y S T R U C T U R E ( A S P E R T H E R E C O R D O F D E P O S I T O R S )

No. of Holders No. of Shares %

Malaysian Malaysian Malaysian
Non-
Category of Non- Non- Bumi- Bumi-
Shareholders Bumiputra Bumiputra Foreign Bumiputra Bumiputra Foreign putra putra Foreign
1) Individual 8,324 43,545 885 21,203,149 283,841,928 14,228,792 0.21 2.86 0.14
2) Body Corporate
A) Banks/Finance
Companies 73 5 0 1,946,148,421 773,551 0 19.61 0.01 0.00
B) Investments
Trusts/
Foundation/
Charities 0 7 0 0 599,620 0 0.00 0.01 0.00
C) Other Types of
Companies 67 539 26 2,364,082,005 63,277,333 24,261,843 23.82 0.64 0.24
3) Government
Agencies/Institutions 4 0 0 31,179,190 0 0 0.31 0.00 0.00
4) Nominees 7,146 4,015 1,621 299,808,127 1,899,846,675 2,973,715,716 3.02 19.15 29.97
5) Trustee 0 0 0 0 0 0 0.00 0.00 0.00
6) Others 0 0 0 0 0 0 0.00 0.00 0.00
15,614 48,111 2,532 4,662,420,892 2,248,339,107 3,012,206,351 46.97 22.67 30.35

Grand Total 66,257 9,922,966,350 99.99

172
 DIRECTORS’ SHAREHOLDINGS (AS PER THE REGISTER OF DIRECTORS’ SHAREHOLDINGS)
No. of Shares Held
Direct Interest %*¹ Deemed Interest %*¹

Tengku Dato’ Sri Zafrul bin Tengku Abdul Aziz 1,780,558 0.02 – –

Dato’ Lee Kok Kwan 1,205,072 0.01 88,648 –*²

Notes:
*¹ Excludes 4,908 shares retained as treasury shares as at 1 March 2020.
*² Less than 0.01%.

S U B S TA N T I A L S H A R E H O L D E R S ( A S P E R T H E R E G I S T E R O F S U B S TA N T I A L S H A R E H O L D I N G S )
No. of Shares Held
Name of Substantial Shareholders Direct %*¹ Indirect %*¹

Khazanah Nasional Berhad 2,358,894,374 23.77 – –

Employees Provident Fund 1,322,121,341 13.32 – –

Kumpulan Wang Persaraan (Diperbadankan) 591,190,821 5.96 – –

Notes:
*¹ Excludes 4,908 shares retained as treasury shares as at 1 March 2020.
*² Includes shares held through nominees.

3 0 L ARGEST SHAREHOLDERS (AS PER REGISTER OF MEMBERS AND RECORDS OF DEPOSITORS)

% of
No. of Issued
Name of Shareholders Shares Held Capital*¹
1. Khazanah Nasional Berhad 2,358,894,374 23.77
2. Citigroup Nominees (Tempatan) Sdn Bhd 1,164,818,084 11.74
Employees Provident Fund Board
3. Kumpulan Wang Persaraan (Diperbadankan) 591,190,821 5.96
4. Amanahraya Trustees Berhad 483,995,262 4.88
Amanah Saham Bumiputera
5. Amanahraya Trustees Berhad 232,711,556 2.35
Amanah Saham Malaysia 2 – Wawasan
6. Amanahraya Trustees Berhad 174,825,338 1.76
Amanah Saham Malaysia
7. HSBC Nominees (Asing) Sdn Bhd 124,844,631 1.26
SBL Exempt An for J P Morgan Securities Plc
8. Citigroup Nominees (Asing) Sdn Bhd 118,189,200 1.19
CBHK for Fubon Life Insurance Co., Ltd (CTL)
9. HSBC Nominees (Asing) Sdn Bhd 117,833,930 1.19
JPMCB NA for Vanguard Total International Stock Index Fund
10. Cartaban Nominees (Asing) Sdn Bhd 109,038,388 1.10
GIC Private Limited for Government of Singapore (C)

173
shareholders’ statistics
as at 1 March 2020

% of
No. of Issued
Name of Shareholders Shares Held Capital*¹
11. Amanahraya Trustees Berhad 107,489,197 1.08
Amanah Saham Bumiputera 2
12. HSBC Nominees (Asing) Sdn Bhd 104,334,350 1.05
HSBC BK PLC for The Prudential Assurance Company Limited (OBA ESI)
13. HSBC Nominees (Asing) Sdn Bhd 103,797,038 1.05
JPMCB NA for Vanguard Emerging Markets Stock Index Fund
14. HSBC Nominees (Asing) Sdn Bhd 103,487,016 1.04
SBL Exempt An For Credit Suisse Securities (Europe) Limited
15. Cartaban Nominees (Tempatan) Sdn Bhd 101,440,874 1.02
PAMB for Prulink Equity Fund
16. Cartaban Nominees (Asing) Sdn Bhd 95,485,912 0.96
Exempt An For State Street Bank & Trust Company (West CLT OD67)
17. Citigroup Nominees (Tempatan) Sdn Bhd 86,985,945 0.88
Great Eastern Life Assurance (Malaysia) Berhad (PAR 1)
18. Amanahraya Trustees Berhad 79,141,233 0.80
Amanah Saham Malaysia 3
19. CGS-CIMB Nominees (Tempatan) Sdn Bhd 77,267,818 0.78
RSS/SBL Exempt An for CGS-CIMB Securities Sdn Bhd
20. DB (Malaysia) Nominee (Asing) Sdn Bhd 73,703,582 0.74
BNYM SA/NV for Eastspring Investments – Asian Equity Fund
21. Citigroup Nominees (Tempatan) Sdn Bhd 71,258,066 0.72
Exempt An for AIA Bhd.
22. Citigroup Nominees (Tempatan) Sdn Bhd 59,655,951 0.60
Employees Provident Fund Board (Nomura)
23. Permodalan Nasional Berhad 54,280,113 0.55
24. Citigroup Nominees (Asing) Sdn Bhd 52,637,782 0.53
CBNY for Dimensional Emerging Markets Value Fund
25. Citigroup Nominees (Asing) Sdn Bhd 51,166,453 0.52
Exempt An for Citibank New York (Norges Bank 14)
26. HSBC Nominees (Asing) Sdn Bhd 48,451,834 0.49
JPMBL SA for Stichting Depositary APG Emerging Markets Equity Pool
27. HSBC Nominees (Asing) Sdn Bhd 46,217,317 0.47
JPMBI for UBS (IRL) Investor Selection Public Limited Company – Global Equity Long Short Fund
28. Citigroup Nominees (Tempatan) Sdn Bhd 41,874,595 0.42
Great Eastern Life Assurance (Malaysia) Berhad (PAR 3)
29. Citigroup Nominees (Asing) Sdn Bhd 37,629,671 0.38
Exempt An for Citibank New York (Norges Bank 1)
30. Maybank Nominees (Tempatan) Sdn Bhd 36,738,247 0.37
Maybank Trustees Berhad for Public Regular Savings Fund (N14011940100)
Total 6,909,384,578 69.65

Note:
*¹ Excludes 4,908 shares retained as treasury shares as at 1 March 2020.

174
 internal policies, procedures

Policies are formulated to govern standard day-to-day operations and to manage the expected risks of CIMB Group. As such, the Group’s
policies are developed from the baseline of current regulatory requirements and industry best practices to govern the business and
operations of the Group.

The policies of our business units have been documented, endorsed by the Group Risk Committee (GRC) or its sub-committee(s) and
approved by our Board or Board Risk Committee for implementation across our Group, where relevant. Operational procedures are
approved by Group Policy & Procedure Oversight Committee (GPOC) for implementation. Approved policies and procedures are timely
disseminated to affected stakeholders. Reviews and updates are performed regularly on approved policies, procedures and guidelines.
This is done with the intent to ensure continuous improvements in operational efficiency while taking into consideration the changing
industry profile on regulatory requirements, risks and internal control measures for mitigation, and new products and services.

Listed below are some of the Group’s key policies and procedures:

No. Title Description

1. a) Group Administration & Property These documents relate to the administrative operations of the Group and covers the
Management Malaysia Policy operational policies governing procurement, property, maintenance services, security
b) Group Administration & Property services, logistics, telecommunications, insurance and occupational safety and health
Management Malaysia Procedure administration.

2. a) Accounting Policy These documents define the accounting concepts and policies that are consistent with
b) Group Finance – Business Malaysia Financial Reporting Standards and Generally Accepted Accounting Practices.
Finance Advisory & Financial
Reporting Standards Procedures
c) Accounting Procedure – Hedge
Accounting

3. Group Outsourcing Policy This document sets out how outsourcing arrangements in the Group are managed
across the lifecycle of the arrangement to ensure proper controls in place in managing
outsourcing risk.

4. a) Business Continuity Management These documents provide the policies and procedures in responding to a disruption,
Policy crisis and/or disaster and to resume critical business functions.
b) Business Continuity Management
Procedure

5. Group Corporate Communications This document sets out the framework for the dissemination of information by the
Group to its shareholders, media and other stakeholders. Information given by the
Group to the general public shall always be timely, accurate, relevant and reliable so as
to enable a properly informed view of how the Group is governed, its financial and
operational performances, future prospects and key corporate developments.

6. Group Crisis Communications Crises affect organisations in varying degrees and frequency. The challenge for the
Guidelines affected organisation is to manage these crises well in order to get back to the business
of running the organisation as quickly as possible. CIMB Group has a Crisis
Communications Guide to aid effective response and communication with affected
stakeholders in a timely and consistent manner. It defines crisis, crisis classification,
escalation procedures, and the establishment of a crisis communication management
team and centre.

7. a) Group Data Management Policy These policies and procedures enable a structured approach to the management of
Manual data and dissemination of information throughout CIMB Group. The manual spells out
b) Group Data Management the data governance and management information system frameworks.
Procedure

175
internal policies, procedures and guidelines

No. Title Description

8. a) Group Anti-Money Laundering/ CIMB Group places importance on, and is committed to establishing an effective
Counter Financing of Terrorism internal control system for AML/CFT in compliance with all related laws, regulations,
Policy guidelines and industry best practices. The Group AML/CFT policies encompasses all
b) Group Anti-Money Laundering/ reporting institutions of CIMB Group, to ensure consistency in managing the AML/CFT
Counter-Financing of Terrorism compliance. The manual governs the appointment of anti-money laundering
Procedure compliance officers, the monitoring and reporting of suspicious transactions, sanction
management, record retention, employee training, risk and status reporting to Board
and Senior Management and an independent audit of the internal AML/CFT measures.

9. Recruitment Policy This document sets out the terms of employment for CIMB employees. These include
recruitment terms such as emolument, retirement, working days and hours, office wear,
conduct and discipline. The handbook sets out employment benefits including
allowances and claims, medical benefits, benefits-in-kind, leave, and employee loans.

10. Risk Management of Travel Policy This document addresses flight travel for staff in order to minimise the potential risks to
CIMB Group in terms of continuity of leadership and operations. The policies cover
senior management, staff at department levels and staff in general.

11. Policy & Procedure on Fit and Proper This document sets out the procedures on Fit and Proper assessment for key
Criteria For Key Responsible Persons responsible persons who are accountable or responsible for the management and
oversight of the entities in the Group regulated by Financial Services Act 2013, Islamic
Financial Services Act 2013 and Insurance Act 1996. These comprise Directors,
members of the Shariah Committee, Chief Executive Officers/Executive Directors, any
person performing a senior management function who has the primary or significant
responsibility for the management and performance of significant business activities;
and any person who has primary or significant responsibility of key control functions.

12. Staff Rejuvenation Programme This document sets out the rules and guidelines to allow staff to take a break from work
without any loss in service or disadvantage in career progression.

13. HR Policy on Staff Volunteerism This document sets out the rules and guidelines to encourage staff to volunteer for CSR
activities funded by CIMB Foundation. The policies provide recognition of time spent by
staff on CSR activities. This is part of CIMB Group’s effort to enhance community
projects by contributing expertise, energy, enthusiasm and efforts of staff. Seven days
of volunteering entitles staff to one day of annual leave in the following year.

14. Staff Welfare Fund The Staff Welfare Fund is established to provide financial assistance to our staff and
their family members to cope with high medical expenses, as a result of being involved
in an accident or due to serious illness. The fund is also used to assist in loss/damage
of property due to natural disasters e.g. fire/flood.

15. Sexual Harassment Policy & These documents set out the policies and guidelines to maintain a working environment
Guidelines which is free of sexual coercion and annoyance. CIMB Group is committed to ensure
that all employees are protected from harassment of any kind and in particular from
sexual harassment. The policy covers all CIMB Group employees including contract
and temporary employees.

16. Whistle Blowing Policy This document is in place to ensure CIMB Group has a disciplined and professional
workforce. Under this policy, employees are required to promptly report incident of
wrongdoings, malpractices or irregularities at their workplace to the Management for
immediate rectification and action and the Management is committed to ensure strict
confidentiality and will not only protect the identity of the complainants and will also
protect the complainant from any harassment and victimisation at work due to the
disclosure.

17. Anti Bribery and Corruption Policy This document sets out policy matters relating to the prevention of bribery and
corruption, and sets out the responsibilities of Group employees and associated
persons working for and on behalf of the Group, in observing and upholding the
Group’s position on anti-bribery and corruption.

176
No. Title Description

18. Global Employee Mobility Policy This document sets out the terms, benefits and guidelines for CIMB employees
deployed on regional secondments. This is part of CIMB Group’s effort to encourage
movement of talent across borders for business and/or talent development purposes.

19. a) Group Conflict Management & These documents consolidated the Group Chinese Walls Policy and Procedures and
Chinese Wall Policy the Group Conflict Management Policy and Procedures.
b) Group Conflict Management &
The revised policy is to prescribe standards, outline the requirements and provide
Chinese Wall Procedure
guidance to ensure processes and controls are in place in order to identify and manage
any conflict or when potential conflict of interest situation arises.
The Personal Account Dealing (PAD) sections that were previously provided by the
Group Conflict Management Policy and Procedures remain valid until the new
standalone PAD Policy and Procedures is approved.

20. a) Shariah Advisory and Board These documents define and explain the overall framework applicable to the Islamic
Shariah Committee Secretariat businesses of CIMB Group so that they can be conducted in the most effective manner
Policy and in line with the Shariah and the regulations of Bank Negara Malaysia (BNM),
b) Shariah Advisory and Board Securities Commission (SC), the rulings of both Shariah Advisory Councils of BNM and
Shariah Committee Secretariat SC (SAC) and the rulings of Group Shariah Committee. Wherever appropriate, reference
Procedure will also be made to the Shariah rulings issued by the Shariah authorities in other
jurisdictions such as Dewan Shariah Nasional, Majelis Ulama Indonesia (DSN-MUI), the
Shariah Committee at Authoriti Monetari Brunei Darussalam etc. based on the
jurisdictional and locality requirements applicable to regional Islamic businesses of
CIMB Group.

21. a) Group T&M – General Policy These documents define the policies and procedures on activities carried out by
b) Group T&M – General Procedure Treasury & Markets department in relation to the Group’s markets, sales and trading
businesses in interest rates, credit, foreign exchange, commodities, equities and their
derivatives, debt capital markets, fixed income investments, and treasury and funding
operations for the Group.

22. a) Group Fraud Management Policy These documents set out clear directives and guidelines on CIMB Group’s fraud risk
b) Group Fraud Risk Governance governance framework. It provides guideline on the parties responsible to (i) instantly
and Procedure respond to a fraud/suspected fraud incident; (ii) take measures to recover or prevent
from further loss of funds and limit any adverse publicity that potentially results in
reputation damage; (iii) take necessary actions to strengthen the operational policies
and procedures, including systems, whenever a fraud/suspected fraud has occurred
either within the CIMB Group or the Industry.

23. a) IT Infrastructure and Service These documents govern all aspects of information technology within the Group and
Policy provides Management with direction and support in accordance with relevant laws,
b) Disaster Recover Policy regulations and business requirements. It is designed to increase adherence to
c) IT General Control Policy regulatory and internal requirements and ensures consistency in the Group’s standards
d) Information Security Policy of operations and practices whilst at the same time facilitating sharing of information
(E-Banking, Digital & Internet across the Group and improved controls across the Group when managing information
Application Policy + Cyber technology. These are global best practices and in accordance with global standards
Security Policy + Information such as COBIT, ITIL, CMMi, ISO etc. This document has been standardised across the
Security Policy) Region to facilitate a Regional Operating Model.
e) Group System Development
Policy
f) End User Computing Policy
(Desktop & Mobility)
g) Bring Your Own Device (BYOD)
Policy
h) IT Service Management Policy
i) IT Project Management Policy

177
internal policies, procedures and guidelines

No. Title Description

24. a) Technology Risk Management These documents provide a consistent and unified approach for developing, managing
Policy and improving technology (including Cyber) risk management within the Group’s
b) Technology Risk Management business operations. It comprises of a systematic method to identify, analyse, evaluate,
Procedure treat, monitor and communicate technology risks associated with any activity, function
or process, thereby protecting the Group by minimising its losses.

25. a) Group Compliance Policies These documents are to establish a compliance programme framework to ensure
b) Group Compliance Procedures compliance with relevant laws, regulations, rules, related self-regulatory organisation
standards, and codes of conduct applicable to its regulated and licenced activities that
govern the overall working of the business and support units within CIMB Group.

26. a) Group Competition Law Policy The Malaysian Competition Act came into force in 2012 and has changed the business
b) Group Competition Law landscape in Malaysia and affected the way all Malaysian businesses operate. The
Procedure Competition Law Manual provides an overview of the Competition Act and guides all
business units within the Malaysian banking entities of CIMB Group to familiarise and
understand the competition laws of Malaysia. It is a general guide on anti-competitive
conduct, anti-competitive agreements and compliance reporting of any violations or
breach of the Malaysian Competition Act.

27. Group Liquidity Risk Management This is the primary reference document on matters relating to the key principles for the
Policy liquidity risk management framework of banking entities within CIMB Group. The policy
sets out key approaches and critical areas for an integrated liquidity risk management
process including liquidity risk strategies, management oversight, roles and
responsibilities of various divisions/departments, risk controls and monitoring
procedures to ensure that the Group has sufficient liquidity to meet its obligations as
they fall due.

Group’s contingency funding plan is in place to alert and to enable the management to
act effectively and efficiently during a liquidity crisis and under adverse market
conditions.

28. Group Reputation Risk Policy The policy sets out the Group’s approach to identifying and managing its reputation
risks within board set appetite. The policy leverages off existing Operational Risk
Management tools and provides additional oversight and monitoring through a Group
Operational & Resiliency Risk Committee (GORRC).

29. Group Credit Risk Policy (with Islamic These documents set out the broad Credit and Financing Policies, applicable to the
addendum) CIMB Group Conventional and Islamic Banking businesses, with the purpose to
establish the discipline for orderly extension of credit and financing activities.

30. a) CIMB Group Personal Data These documents outline the requirements of the Personal Data Protection Act 2010
Protection Policy (PDPA) and is intended to assist CIMB Group in meeting its statutory responsibilities as
b) CIMB Group Personal Data detailed in the PDPA. It serves as a general guide to the PDPA and CIMB Group’s
Protection Procedure related processes and obligations to ensure that all staff within the relevant entities/
divisions of the Group in Malaysia is familiar with, understand and comply with the
personal data protection laws of Malaysia.

31. a) Group Shariah Review Policy These documents define and explain the overall Shariah compliance review framework
b) Group Shariah Review Procedure applicable to the Islamic banking and finance businesses of CIMB Group to ensure
Shariah compliance and handle Shariah non-compliance events.

178
No. Title Description

32. CIMB Group Enterprise-Wide Risk This describes the policies, guidelines and methodologies for managing risk across the
Management (EWRM) Framework Group. It provides guidance to the risk management teams towards achieving a
common platform and consistent approach to risk management across the Group;
provides an overview of each identified risk to promote clear and accountable risk
management processes; and facilitates readiness and compliance to Bank Negara
Malaysia and other regulatory requirements.

33. Group Market Risk Policy This policy prescribes a consistent Group-wide framework to manage market risk
across all CIMB entities. It serves as a primary reference document for the Group in
establishing a sound operating environment for market risk activities that is consistent
with the governance and control standards of the Group Risk Appetite Statement.

34. Group Operational Risk Management This policy sets out the Group’s approach in managing operational risk. The policy sets
Policy out the tools used by the first line of defence to identify, assess, manage and report
their operational risks.

35. Group Interest Rate Risk/Rate of This is the Group’s primary reference document on the key principles for the interest
Return In Banking Book Policy rate risk management for the non-traded books. This policy also sets out the approving
authority of risk policies, Board and management oversight, roles and responsibilities of
divisions/departments, risk measurement methodologies, risk controls, monitoring and
reporting procedures to ensure that the interest rate risk arising from the Group
operations is properly identified, measured, monitored and managed over a range of
potential changing interest rate environments including stress conditions.

36. a) CIMB Group Shariah Risk a) This document articulates the objectives, mission, guiding principles, governance
Management Policy structure as well as methodology and approach adopted by the Group in
managing Shariah Non-Compliance (SNC) risk.
b) CIMB Group Shariah Risk b) This document provides explanation/illustration that could facilitate the Group in
Management Procedures identifying, assessing, controlling and monitoring SNC risk inherent in its Islamic
products and day-to-day activities.

37. Group Credit Risk Policy This Policy sets out the credit risk guiding principles for application across the Group to
ensure consistency in its credit risk management activities.

38. Group New Product Approval This Policy sets out a consistent framework to risk manage the launch of new and
Procedure varied products. New products will be subjected to a robust internal approval process
that requires objective review and appropriate senior management sign off before they
are offered to customers or investors.

39. Group Retail Credit/Financing Policy This Policy is an overarching group policy which governs the credit aspects of Retail
lending business. It applies to major retail lending products such as Property Financing,
Vehicle Financing, Credit Cards and other revolving credit facilities, secured and
unsecured term financing, for CIMB retail banking in all the countries where CIMB is
present.

40. Group Internal Capital Adequacy This Policy describes the policies aspects of ICAAP for all entities within CIMB Group. It
Assessment Process (ICAAP) Policy ensures adequate policies are in place for efficient and proper conduct of ICAAP across
various divisions within the Group. The Policy also sets out the key ICAAP requirements
which include assessing the risk profile of the bank, assessing capital adequacy,
monitoring compliance with regulatory requirement on capital adequacy, reporting to
management and regulator on ICAAP and ICAAP governance and independent review.

179
internal policies, procedures and guidelines

No. Title Description

41. a) Group Delegated Authority Policy These documents set out the nature and extent of the authority formally delegated from
b) Group Delegated Authority the CIMB Group Holdings Berhad’s Board of Directors. The contents cover both
Procedure financial approval and document execution. This policy does not apply to delegated
credit and human resource authorities which are covered separately by the respective
Divisions’ policies.

42. Group Internal Audit Policy Manual This document sets out the policies, strategies and detailed procedures of GIAD in
order to deliver an efficient and effective internal audit service (including investigation) in
congruence with the goals of the CIMB Group of Companies.

43. a) Group Entity Governance Policy These documents are developed to put in place the minimum governance requirements
b) Group Entity Governance for entities across the Group in terms of:
Procedure • Directors’ and Responsible Officers’ requirements, roles and responsibilities
• Management accountability
• Committee structure and oversight
• Adherence to Group Policies and Procedures
• Inter-entity Service Level Agreements
• Adherence to the Group Financial Booking Governance
• Financial Delegation of Authority

The Policy sets out how subsidiaries, joint-venture entities, associates and the like are
governed by its parent and the apex entity, through (i) how the entities communicate
with each other and (ii) the implementation of controls that are dependent on the
entities’ categorisation.

44. a) Group Customer Experience These documents set out the standard framework and mechanism when dealing with
Management – Complaints customers’ complaints regionally in accordance with regulatory and CIMB Group
Handling Policy Manual standards. This is to ensure prompt and constructive responses are given to Customer
b) Group Customer Experience which in turn will build customer loyalty and confidence towards CIMB Group.
Management – Complaints
Handling Procedure Manual

45. a) CIMB Group Customer Exit These documents provide a common customer exit handling standards which are to be
Handling Policy adhered to by all relevant business units and/or departments within CIMB Group
b) CIMB Group Customer Exit entities, in order to effectively safeguard the reputation of the franchise and to mitigate
Handling Procedure associated negative impacts.

46. a) Group Customer Experience These documents are established in line with BNM’s Market Conduct and Consumer
Management – Treating Empowerment standards. It aims to inculcate the Treating Customers Fairly principles
Customers Fairly Policy Manual into the corporate culture of CIMB Group.
b) Group Customer Experience
Management – Treating It states the guidelines to be applied in managing and working towards fair treatment of
Customers Fairly Procedure customers and sets out the principles to ensure CIMB Group of employees comply with
Manual internal Treating Customers Fairly requirements.

47. a) Disclosure of Customer These documents describe the broad principles on disclosure of customer documents
Information to Law Enforcement or information to law enforcement agency(ies) with the purpose to facilitate the
Agency Policy Manual investigation or prosecution by law enforcement agency(ies). It is established to provide
b) Disclosure of Customer a clear guidance on the circumstances that a disclosure of customer documents or
Information to Law Enforcement information is permitted and the method of such disclosure is to be released to the Law
Agency Procedure Manual Enforcement Agency. This is to ensure compliance with the guidelines issued by BNM
on disclosure of customer information.

180
 top 10 properties of

Tenure/ Remaining Age of Net Book

Date of Lease Property Value* Year of Date of
Location Description/Existing Use Expiry (years) (years) (MYR) Acquisition Revaluation

MENARA CIMB 40 storey office building Freehold n/a 5 700,000,000 2015 Dec-19
1 Jalan Stesen Sentral 2 with 6 storey of basement
Kuala Lumpur Sentral car park. Building
50470 Kuala Lumpur majority occupied by
Malaysia CIMB Group of
companies with partial
lower zone leased out to
3rd party.

CIMBTHAI 25 storey office building Freehold n/a 20 281,914,822 1999 Sep-16

Langsuan Building with 1 basement level.
44 Langsuan Road, Premises occupied by
Lumpini CIMB Thai Bank (Head
Patumwan, Bangkok Office Branch), CIMB Thai
10330 Bank’s division offices
and subsidiary company
offices.

Menara Sentraya 41 storey office building, Freehold n/a 3 125,767,9 82 2015 May-19
Lt. 28, 29, 30, 31, 32 CIMB Niaga owned 5
Jl. Iskandarsyah storey.
No. 2 Melawai Blok M
Jakarta Selatan

WISMA CIMB 7 storey office building Freehold n/a 12 120,998,526 2018 Aug-17
No. 11, Jalan 4/83A together with 3 levels of
Off Jalan Pantai Baru basement car park.
59200 Kuala Lumpur Building majority
occupied by CIMB Bank
with Ground floor leased
out to 3rd party.

Wisma CIMB Niaga 11 storey office building Leasehold 4 29 74,148,181 2001 May-19
Jl. Gatot Subroto used as CIMB Niaga expiring on
No. 2 Bandung Head Office and some 6 December
floors are rented to 3rd 2023
party.

Jl. Gajah Mada 18 3 storey office building Leasehold 17 29 52,865,999 2006 May-19
Jakarta Pusat used as CIMB Niaga expiring on
Head Office and Branch. 17 January
2036

CIMB Niaga Lippo 8 storey office building Leasehold 4 27 51,833,058 2012 May-19
Cikarang used as CIMB Niaga expiring on
Jl. MH Thamrin Lippo Head Office and some 5 May 2023
Cikarang floors are rented to 3rd
party.

Synergy Building 20 storey office bulding, Leasehold 5 8 40,027,733 2014 May-19

Jl. Sutera Barat Kav 17 CIMB Niaga owned 7 expiring on
Alam Sutera, Serpong Floors (GF, UG, 1st, 2nd, 3 April 2024
Tangerang, Banten 3rd, 5th, 6th), used as
CIMB Niaga Branch and
Head Office business
support.

CIMB Niaga Kebon Sirih CIMB Niaga Branch Leasehold 12 35 33,118,073 2003 May-19
Jl. Kebon Sirih 33 premises. expiring on
Jakarta Pusat 22 August
2031

Berita Satu Plaza CIMB Niaga owned 3 Leasehold 5 35 30,127,975 1997 May-19
Jl Gatot Subroto Kav Floors (GF, 1st, 3rd), used expiring on
35-36, Jakarta Selatan as CIMB Niaga Branch 31 March
and Head Office business 2024
support.

181
corporate
as at 1 March 2020

Datuk Mohd Nasir Ahmad Robert Neil Coombe Afzal Abdul Rahim
BOARD OF Chairperson/Independent Director Independent Director Independent Director
DIRECTORS
Tengku Dato’ Sri Zafrul Tengku Dato’ Mohamed Ross Mohd Din Didi Syafruddin Yahya
Abdul Aziz Independent Director Independent Director
Group Chief Executive Officer/ (Appointed on 7 May 2019)
Executive Director Dato’ Lee Kok Kwan
Non-Independent Director Tongurai Limpiti
Teoh Su Yin Independent Director
Senior Independent Director Ahmad Zulqarnain Che On (Appointed on 7 May 2019)
Non-Independent Director (Resigned on 30 December 2019)

GROUP
Datin Rossaya Mohd AUDIT Dato’ Mohamed Ross Datuk Mohd Nasir Ahmad
COMPANY
Nashir COMMITTEE Mohd Din Independent Director
SECRETARY
LS 0007591 Chairperson/
Independent Director Teoh Su Yin
Senior Independent Director

BOARD RISK AND

Robert Neil Coombe Teoh Su Yin Dato’ Mohamed Ross Mohd Din
COMPLIANCE
Chairperson/Independent Director Senior Independent Director Independent Director
COMMITTEE
Datuk Mohd Nasir Ahmad Dato’ Lee Kok Kwan Ahmad Zulqarnain Che On
Independent Director Non-Independent Director Non-Independent Director

GROUP Teoh Su Yin GROUP Dr Shafaai Musa

NOMINATION AND Chairperson/ SHARIAH Chairperson/Independent Member
Senior Independent Director COMMITTEE
REMUNERATION Sheikh Professor Dr Yousef bin
COMMITTEE Abdullah Al Shubaily
Datuk Mohd Nasir Ahmad
Independent Director Independent Member

Sheikh Dr Nedham Yaqoobi

Dato’ Mohamed Ross Mohd Din
Independent Member
Independent Director
Associate Professor Dr Aishath Muneez
Ahmad Zulqarnain Che On Independent Member
Non-Independent Director
Ahmed Baqar Rehman
Robert Neil Coombe Independent Member
Independent Director (Appointed on 1 June 2019)

Sheikh Professor Dr Mohammad

Didi Syafruddin Yahya
Hashim Kamali
Independent Director
Independent Member
(Appointed on 7 May 2019)
(Contract Expired on 13 June 2019)
Afzal Abdul Rahim Dr Ahmad Sufian Che Abdullah
Independent Director Independent Member
(Resigned on 31 July 2019) (Appointed on 1 November 2019)

182
 Level 13, Menara CIMB Tengku Dato’ Sri Zafrul Tengku Abdul Aziz
REGISTERED Jalan Stesen Sentral 2 GROUP Country Head, Malaysia
OFFICE Kuala Lumpur Sentral MANAGEMENT Group Chief Executive Officer & Chief Executive Officer/
50470 Kuala Lumpur, Malaysia Executive Director, CIMB Bank Berhad
Tel: 603-2261 0085 Tigor M. Siahaan
Fax: 603-2261 0099 Country Head, Indonesia
President Director & Chief Executive Officer,
Website: [Link]
PT Bank CIMB Niaga Tbk
Investor Relations: ir@[Link]
Senior Independent Director: Victor Lee Meng Teck
cimbSID@[Link] Country Head, Singapore
Chief Executive Officer, CIMB Bank, Singapore
Social media: Chief Executive Officer, Group Commercial Banking
[Link]/
CIMBMalaysia Adisorn Sermchaiwong
Country Head, Thailand
[Link]/CIMB_Assists President & Chief Executive Officer/Executive Director,
[Link]/ CIMB Thai Bank PCL
cimbmalaysia/
Ahmad Shahriman Mohd Shariff
[Link]/company/cimb Chief Executive Officer, Group Islamic Banking
Chief Executive Officer/Executive Director,
CIMB Islamic Bank Berhad

Shahnaz Jammal
Boardroom Share Registrars
Chief Executive Officer, Group Wholesale Banking
REGISTRAR Sdn Bhd
(199601006647 (378993-D)) Samir Gupta
11th Floor Menara Symphony Chief Executive Officer, Group Consumer Banking
No. 5 Jalan Prof. Khoo Kay Kim
Seksyen 13 Rafe Haneef
46200 Petaling Jaya, Selangor Chief Executive Officer, Group Transaction Banking
Malaysia
Effendy Shahul Hamid
Helpdesk: 603-7890 4700 Chief Executive Officer, Group Ventures & Partnerships
Fax: 603-7890 4670
E-mail address: [Link]@ Gurdip Singh Sidhu
Group Chief Strategy & Design Officer
[Link]
Khairul Rifaie
Group Chief Financial Officer

Omar Siddiq
Group Chief Operating Officer
PricewaterhouseCoopers Dato’ Hamidah Naziadin
AUDITORS
Level 10, 1 Sentral, Jalan Travers Group Chief People Officer
Kuala Lumpur Sentral Chief Executive Officer, CIMB Foundation
PO Box 10192
50706 Kuala Lumpur David Richard Thomas
Group Chief Risk Officer

Kwan Keen Yew

Group Chief Legal & Compliance Officer
STOCK
Listed on Main Market of Bursa
EXCHANGE
Malaysia Securities Berhad Amran Mohamad
LISTING Group Chief Internal Auditor
since 3 November 1987

Stock Code: 1023 Datin Rossaya Mohd Nashir

Group Company Secretary

183
group corporate

CIMB Group Holdings Berhad CIMB Bank Plc CIMB Bank Berhad
Level 13, Menara CIMB 20AB, Corner Preah Norodom
Shanghai Branch
Jalan Stesen Sentral 2 Boulevard & Street 118
Kuala Lumpur Sentral Sangkat Phsar Chas Unit 1805-1807, AZIA Center
50470 Kuala Lumpur, Malaysia Phnom Penh 12203 1233, Lujiazui Ring Road
Tel : 603 2261 8888 Kingdom Of Cambodia Pudong New District
Fax : 603 2261 8899 Tel : 855 23 988 388 Shanghai 200120, China
Website : [Link] Fax : 855 23 988 099 Tel : 86 21 2026 1888
Website : [Link] Fax : 86 21 2026 1988
CIMB Bank Berhad Website : [Link]
Level 17, Menara CIMB CIMB Bank (Vietnam) Limited
Jalan Stesen Sentral 2 Level 2, CornerStone Building CIMB Bank Berhad
Kuala Lumpur Sentral 16 Phan Chu Trinh
H o n g Ko n g B r a n c h
50470 Kuala Lumpur, Malaysia Hoan Kiem District
Tel : 603 2261 8888 Hanoi, Vietnam 25th Floor, Gloucester Tower
Fax : 603 2261 8899 Tel : 84 4 3266 3388 The Landmark, 15 Queen’s Road
Website : [Link] Fax : 84 4 3266 3389 Central, Hong Kong
Website : [Link] Tel : 852 2586 7288
CIMB Investment Bank Berhad Fax : 852 2556 3863
Level 17, Menara CIMB CIMB Bank (L) Limited Website : [Link]
Jalan Stesen Sentral 2 Level 14(A), Main Office Tower
Kuala Lumpur Sentral Financial Park Labuan CIMB Bank Berhad
50470 Kuala Lumpur, Malaysia Jalan Merdeka
Philippines Branch
Tel : 603 2261 8888 87000 W P Labuan, Malaysia
Fax : 603 2261 8899 Tel : 6087 597 500 Ground Floor, ORE Central Building
Website : [Link] Fax : 6087 597501 9th Avenue Corner 31st Street
Website : [Link] Bonifacio Global City, Taguig
CIMB Islamic Bank Berhad 1634 Philippines
Level 17, Menara CIMB CIMB Bank Berhad Tel : 63 2 249 9000
Jalan Stesen Sentral 2 Fax : NIL
Singapore Branch
Kuala Lumpur Sentral Website : [Link]
50470 Kuala Lumpur, Malaysia #09-01, Singapore Land Tower
Tel : 603 2261 8888 50, Raffles Place 048623 CIMB Bank Berhad
Fax : 603 2261 8899 Singapore
Labuan Offshore Branch
Website : [Link] Tel : 65 6337 5115
Fax : 65 6337 5335 Level 14(A), Main Office Tower
PT Bank CIMB Niaga Tbk Website : [Link] Financial Park Labuan
16th Floor, Ji. Jend Sudirman Kav. 58 Jalan Merdeka
Graha CIMB Niaga CIMB Bank Berhad 87000 W P Labuan, Malaysia
Jakarta 12190, Indonesia Tel : 6087 597 500
London Branch
Tel : 6221 250 5252 Fax : 6087 597501
Fax : 6221 252 6749 Ground Floor, 27, Knightsbridge Website : [Link]
Website : [Link] London SW1X 7LY
United Kingdom CIMB Investment Bank Berhad
CIMB Thai Bank Public Company Tel : 44 0 20 7201 3150
Brunei Branch
Limited Fax : 44 0 20 7201 3151
44, Langsuan Road Website : [Link] 14th Floor, PGGMB Building
Lumpini, Pathumwan Jalan Kianggeh
Bangkok 10330, Thailand Bandar Seri Begawan BS8111
Tel : 662 638 8000/662 626 7000 Brunei Darussalam
Fax : 662 657 3333 Tel : 673 224 1888
Website : [Link] Fax : 673 224 0999
Website : [Link]

184
CIMB Thai Bank Pcl iCIMB (MSC) Sdn. Bhd. CIMB Bank Berhad
19th Floor, Tower 5, Avenue 7
Vientiane Branch Ya n g o n R e p r e s e n t a t i v e O f f i c e
Bangsar South
010, Lanexang Avenue No. 8, Jalan Kerinchi 1008, Level 10, Sakura Tower
Unit 2, Ban Hatsadi 59200 Kuala Lumpur, Malaysia Kyauktada Township
Chanthabury District Tel : 603 2180 7198 Yangon, Myanmar
Vientiane, Lao Pdr Fax : 603 2180 7100 Tel : 951 8 255 430
Tel : 856 21 255 355 Website : [Link] Fax : 951 8 255 430
Fax : 856 21 255 356 Website : [Link]
Website : [Link] CIMB Foundation
Level 17, Menara CIMB CIMB Bank Berhad
Touch ‘N Go Sdn. Bhd. Jalan Stesen Sentral 2
Mumbai Representative Of fice
Tower 6, Avenue 5, Bangsar South Kuala Lumpur Sentral
No. 8, Jalan Kerinchi 50470 Kuala Lumpur, Malaysia Plot No.C-59, G - Block, Platina
59200 Kuala Lumpur, Malaysia Tel : 603 2261 8888 Office No. 603a, 6th Floor
Tel : 603 2714 8000 Fax : 603 2261 8899 Bandra Kurla Complex
Fax : 603 2714 8001 Website : [Link] Bandra (East), Mumbai 400051
Website : [Link] Tel : 91 22 6671 1570/
CIMB Bancom Capital Corporation 91 02 2650 0330
CIMB Trust Limited 28th Floor, ORE Central Building Fax : NIL
Level 14(A), Main Office Tower 9th Avenue Corner 31st Street Website : [Link]
Financial Park Labuan Bonifacio Global City
Jalan Merdeka Taguig, 1634 Philippines
87000 W P Labuan, Malaysia Tel : NIL
Tel : 6087 414 252 Fax : NIL
Fax : 6087 411 855 Website : [Link]
Website : [Link]
CIMB Investment Bank (Private)
CIMB Islamic Trustee Berhad Limited
Level 21, Menara CIMB Level 33, West Tower
Jalan Stesen Sentral 2 World Trade Centre, Echelon Square
Kuala Lumpur Sentral Colombo 01, Sri Lanka
50470 Kuala Lumpur, Malaysia Tel : 94 11 234 8888
Tel : 603 2261 8888 Fax : 94 11 244 1801
Fax : 603 2261 8899 Website : [Link]
Website : [Link]
CGS-CIMB Holdings Sdn Bhd
CIMB Commerce Trustees Berhad Level 13, Menara CIMB
Level 21, Menara CIMB Jalan Stesen Sentral 2
Jalan Stesen Sentral 2 Kuala Lumpur Sentral
Kuala Lumpur Sentral 50470 Kuala Lumpur, Malaysia
50470 Kuala Lumpur, Malaysia Tel : 603 2261 8888
Tel : 603 2261 8888 Fax : 603 2261 8899
Fax : 603 2261 8899 Website : [Link]
Website : [Link]
CGS-CIMB Securities International
iCIMB (Malaysia) Sdn. Bhd. Pte. Ltd.
19th Floor, Tower 5, Avenue 7 #16-02, Singapore Land Tower
Bangsar South 50, Raffles Place 048623
No. 8, Jalan Kerinchi Singapore
59200 Kuala Lumpur, Malaysia Tel : 65 6225 1228
Tel : 603 2180 7198 Fax : 65 6225 1522
Fax : 603 2180 7100 Website : [Link]
Website : [Link]

185
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 CIMB GROUP HOLDINGS BERHAD 195601000197 (50841-W)
CIMB GROUP HOLDINGS BERHAD
ANNUAL REP ORT 2019

PERFORMANCE
Strong balance sheet
FORWARD23 and top line growth
across the region
Great strides through Page 18
Group-wide
implementation
with over 500
strategic projects
Page 16

[Link]

SUSTAINABILITY
Embedded economic,
environmental and social
considerations into our
operations and
lending policies
Page 17
ANNUAL REPORT 2019

CUSTOMER TECHNOLOGY VENTURES &

CENTRICITY & DATA OUR PEOPLE PARTNERSHIPS SUSTAINABILITY
ADVANCING CUSTOMERS AND SOCIETY