ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia)

Transcription

1 ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia) QUARTERLY REPORT ON CONSOLIDATED RESULTS FOR THE (The figures have not been audited) CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 3rd Quarter Ended Cumulative 9 Months Ended Note Interest income A13 492, ,142 1,427,604 1,340,382 Interest expense A14 (276,713) (245,623) (790,903) (705,903) Net interest income 215, , , ,479 Net income from Islamic banking business A15 63,219 58, , , , , , ,326 Fee and commission income 75,137 74, , ,273 Fee and commission expense (28,024) (29,143) (82,600) (85,738) Investment income 28,830 15,865 89,154 70,233 Other income 6,203 16,710 29,463 50,349 Other operating income A16 82,146 78, , ,117 Net income 361, ,077 1,071,431 1,075,443 Other operating expenses A17 (174,959) (156,623) (508,338) (481,420) Operating profit before allowance 186, , , ,023 Allowance made for loans advances and financing and other receivables A18 (6,418) (26,950) (42,794) (22,114) Write-back of impairment on securities 1,751 1,743 2,427 6,689 Operating profit after allowance 181, , , ,598 Share of profit of equity-accounted, net of tax joint venture Profit before taxation 181, , , ,612 Taxation B5 (45,972) (41,882) (130,675) (141,101) Net profit for the financial period 135, , , ,511 Other comprehensive income/(expense): Items that may be reclassified subsequently to profit or loss: Revaluation reserve on financial investments available-for-sale - Net gain/(loss) from change in fair value 58,431 (37,600) (1,692) 23,511 - Realised gain transferred to statement of income on disposal and impairment (1,301) (512) (2,337) (15,092) - Transfer (to)/from deferred tax (13,711) 9, (5,723) Other comprehensive income/(expense), net of tax 43,419 (28,972) (3,062) 2,696 Total comprehensive income for the period 179,017 97, , ,207 Net profit for the financial period attributable to: Owners of the parent 135, , , ,511 Total comprehensive income attributable to: Owners of the parent 179,017 97, , ,207 Earnings per share attributable to owners of the parent: - Basic (sen) B15(a) Diluted (sen) B15(b) (The Condensed Consolidated Statements of Comprehensive Income should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 1

2 ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia) QUARTERLY REPORT RESULTS FOR THE (The figures have not been audited) CONDENSED STATEMENT OF COMPREHENSIVE INCOME - COMPANY 3rd Quarter Ended Cumulative 9 Months Ended Note Interest income A ,640 1,491 Other income A16 125, , , , , , , ,771 Other operating expenses A17 (761) (752) (2,317) (2,156) Operating profit 125, , , ,615 Write-back of impairment on amount due from subsidiaries ,327 Profit before taxation 125, , , ,942 Taxation B5 (367) (86) (873) (748) Net profit for the financial period 125, , , ,194 (The Condensed Statement of Comprehensive Income should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 2

3 CONDENSED STATEMENTS OF FINANCIAL POSITION ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia) Company UNAUDITED AUDITED UNAUDITED AUDITED ASSETS Cash and short-term funds 1,215,798 2,696,183 53,365 75,357 Deposits and placements with banks and other financial institutions - 298, Balances due from clients and brokers A19 190, , Financial assets held-for-trading A20 185,566 10, Financial investments available-for-sale A21 10,945,458 9,753, Financial investments held-to-maturity A22 1,133,878 1,319, Derivative financial assets B11 124, , Loans, advances and financing A23 38,297,146 36,566, Other receivables A24 135,914 90,053 2,975 1,184 Investment in subsidiaries - - 1,781,364 1,780,679 Investment in a joint venture Tax recoverable 39,376 27, Statutory deposits with Bank Negara Malaysia 1,674,814 1,675, Property, plant and equipment 90,597 97, Intangible assets 365, , Deferred tax assets 13,798 12, TOTAL ASSETS 54,413,679 53,141,521 1,838,484 1,858,021 LIABILITIES AND EQUITY Deposits from customers B10(a), A25 43,539,543 44,606, Deposits and placements of banks and other financial institutions B10(b), A26 3,056,676 1,489, Obligations on securities sold under repurchase agreements 97, Balances due to clients and brokers A27 162,976 62, Bills and acceptances payable - 801, Derivative financial liabilities B11 129, , Amount due to Cagamas Berhad 6,225 7, Other liabilities A28 909, ,595 2,474 1,999 Subordinated obligations B10(c) 1,815, , Other Borrowings B10(d) 9, Provision for taxation 342 2, Provision for zakat Deferred tax liabilities 15,155 13, TOTAL LIABILITIES 49,742,295 48,646,416 2,718 2,253 Share capital 1,548,106 1,548,106 1,548,106 1,548,106 Reserves 3,204,049 3,033, , ,383 Shares held for Employees' Share Scheme (80,771) (86,721) (80,771) (86,721) CAPITAL AND RESERVES ATTRIBUTABLE TO OWNERS OF THE PARENT 4,671,384 4,495,105 1,835,766 1,855,768 TOTAL LIABILITIES AND EQUITY 54,413,679 53,141,521 1,838,484 1,858,021 COMMITMENTS AND CONTINGENCIES A30 24,003,239 22,745, Net assets per share attributable to owners of the parent (RM)* * The net assets per share attributable to owners of the parent is computed as total equity divided by total number of ordinary shares in circulation. (The Condensed Statements of Financial Position should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 3

4 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE Attributable to Owners of the Parent Employees' Share Scheme Shares Share Share Statutory Capital Regulatory Revaluation ("ESS") held for Retained Total Capital Premium Reserve Reserve reserve Reserve Reserve ESS Profits Equity 31 December 2015 At 1 April ,548, , ,627 7,013-78,232 11,944 (86,721) 1,804,615 4,495,105 Net profit for the financial period , ,190 Other comprehensive expense (3,062) (3,062) Total comprehensive (expense)/income for the financial period (3,062) , ,128 Transfer to statutory reserve , (64,318) - Transfer to regulatory reserve , (135,619) - Share-based payment under ESS , ,573 Transfer to retained profits on share lapsed: - employees of subsidiaries (12) Dividends paid to shareholders (219,497) (219,497) ESS shares grant vested to: - employees of subsidiaries (4,546) 4, employees of joint venture (87) own employees (152) ESS shares option exercised by: - employees of subsidiaries (90) Proceeds from share option exercised ,075-1,075 Transfer of ESS shares purchase price difference on shares vested (1,222) - 1,222 - At 31 December ,548, , ,945 7, ,619 75,170 11,408 (80,771) 1,778,605 4,671, December 2014 ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia) At 1 April ,548, , ,017 7,013-7,071 18,912 (112,263) 1,705,871 4,166,016 Net profit for the financial period , ,511 Other comprehensive income , ,696 Total comprehensive income for the financial period , , ,207 Transfer to statutory reserve - - 9, (9,806) - Share-based payment under ESS , ,088 Transfer to retained profits on share lapsed: - employees of subsidiaries (363) own employees (13) Dividends paid to shareholders (296,166) (296,166) ESS shares grant vested to: - employees of subsidiaries (6,715) 6, own employees (156) ESS shares option exercised by: - employees of subsidiaries (683) Proceeds from share option exercised ,108-11,108 Transfer of ESS shares purchase price difference on shares vested (3,059) - 3,059 - At 31 December ,548, , ,823 7,013-9,767 14,011 (93,601) 1,840,845 4,327,253 (The Condensed Consolidated Statements of Changes In Equity should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 4

5 UNAUDITED CONDENSED STATEMENT OF CHANGES IN EQUITY FOR THE Non-Distributable <Distributable> Employees' Share Scheme Shares Share Share ("ESS") held for Retained Total Capital Premium Reserve ESS Profits Equity Company 31 December 2015 At 1 April ,548, ,289 11,944 (86,721) 78,150 1,855,768 Net profit for the financial period , ,859 Share-based payment under ESS - - 5, ,573 Transfer to retained profits on share lapsed: - employees of subsidiaries - - (12) - - (12) Dividends paid to shareholders (219,497) (219,497) ESS recharge amount received from subsidiaries ,546-4,546 ESS recharge amount received from joint venture ESS shares grant vested to: - employees of subsidiaries - - (4,546) - - (4,546) - employees of joint venture - - (87) - - (87) - own employees - - (152) ESS shares option exercised by: - employees of subsidiaries - - (90) Proceeds from share option exercised ,075-1,075 Transfer of ESS shares purchase price difference on shares vested - - (1,222) - 1,222 - At 31 December ,548, ,289 11,408 (80,771) 52,734 1,835, December 2014 ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia) At 1 April ,548, ,289 18,912 (112,263) 41,954 1,800,998 Net profit for the financial period , ,194 Share-based payment under ESS - - 6, ,088 Transfer to retained profits on share lapsed: - employees of subsidiaries - - (363) - - (363) - own employees - - (13) Dividends paid to shareholders (296,166) (296,166) ESS recharge amount received from subsidiaries ,715-6,715 ESS shares grant vested to: - employees of subsidiaries - - (6,715) - - (6,715) - own employees - - (156) ESS shares option exercised by: - employees of subsidiaries - - (683) Proceeds from share option exercised ,108-11,108 Transfer of ESS shares purchase price difference on shares vested - - (3,059) - 3,059 - At 31 December ,548, ,289 14,011 (93,601) 77,054 1,849,859 (The Condensed Statement of Changes In Equity should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 5

6 ALLIANCE FINANCIAL GROUP BERHAD (Company Number : 6627-X) (Incorporated in Malaysia) UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE Unaudited Unaudited 9 Months 9 Months Ended Ended CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation 522, ,612 Adjustments for: Accretion of discount less amortisation of premium of financial investments (50,100) (51,747) Depreciation of property, plant and equipment 17,235 15,558 Dividends from financial investments available-for-sale (3,145) (2,179) Loss/(gain) on disposal of property, plant and equipment 11 (1) Gain on disposal of non-current assets held for sale - (21,605) Net loss/(gain) from sale of financial assets held-for-trading 1,260 (7) Net gain from sale of financial investments available-for-sale (2,337) (15,092) Unrealised gain on revaluation of financial assets held-for-trading (473) (42) Unrealised loss/(gain) on revaluation of derivative financial instruments 16,880 (112,461) Unrealised gain arising from financial liabilities designated at fair value (19,155) - Interest expense on subordinated obligations 32,224 22,164 Interest on other borrowings 31 - Interest on securities sold under repurchase agreements 26 - Interest income from financial investments held-to-maturity (20,197) (20,223) Interest income from financial investments available-for-sale (234,421) (236,861) Interest income from financial assets held-for-trading (3,216) (225) Allowance for loans, advances and financing 56,104 56,544 Allowance for other receivables 2,976 1,162 Net write-back of financial investments held-to-maturity (1,676) (4,930) Net write-back of financial investments available-for-sale (750) (1,759) Amortisation of computer software 16,066 13,444 Share options/grants under ESS 5,457 5,990 Property, plant and equipment written off Computer software written off 28 4 Share of profit of equity-accounted, net of tax joint venture (139) (14) Zakat 2 (37) Operating profit before working capital changes 335, ,959 Changes in working capital: Deposits from customers (1,043,262) 2,215,599 Deposits and placements of banks and other financial institutions 1,865,068 1,018,147 Bills and acceptances payable (801,578) - Balances due from clients and brokers 12,485 2,699 Other liabilities (25,386) 13,265 Financial assets held-for-trading (176,193) 105,151 Loans, advances and financing (1,787,218) (3,526,350) Other receivables (48,837) 23,263 Statutory deposits with Bank Negara Malaysia 612 (95,650) Amount due to Cagamas Berhad (778) (6,698) Obligation on securities sold under repurchase agreements 97,105 - Cash used in operations (1,572,066) (23,615) Taxes paid (143,209) (153,414) Zakat paid (61) (198) Net cash used in operating activities (1,715,336) (177,227) 6

7 ALLIANCE FINANCIAL GROUP BERHAD UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE (contd.) Unaudited Unaudited 9 Months 9 Months Ended Ended CASH FLOWS FROM INVESTING ACTIVITIES Dividends received from financial investments available-for-sale 3,145 2,179 Interest received from financial investments held-to-maturity 20,197 20,223 Interest received from financial investments available-for-sale 234, ,861 Interest received from financial assets held-for-trading 3, Acquisition of joint venture, net of cash acquired - (396) Purchase of property, plant and equipment (10,598) (19,221) Purchase of computer software (21,466) (17,167) Proceeds from disposal of property, plant and equipment Proceeds from disposal of non-current assets held for sale - 49,353 Proceed from disposal of financial investments held-to-maturity 244,111 59,609 Purchase of financial investments available-for-sale (1,199,843) (120,996) Net cash (used in)/generated from investing activities (726,713) 210,677 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of subordinated bonds 1,200,000 - Interest paid on subordinated obligations (29,982) (28,920) Proceeds from other borrowings 9,981 - Proceeds from ESS exercised by employees/joint venture 1,162 11,108 Dividends paid to shareholders of the Company (219,497) (296,166) Net cash generated from/(used in) financing activities 961,664 (313,978) NET CHANGE IN CASH AND CASH EQUIVALENTS (1,480,385) (280,528) CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 2,696,183 2,129,782 CASH AND CASH EQUIVALENTS AT END OF PERIOD 1,215,798 1,849,254 Cash and cash equivalents comprise the following: (Company Number : 6627-X) (Incorporated in Malaysia) Cash and short-term funds 1,215,798 1,849,254 (The Condensed Consolidated Statements of Cash Flows should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 7

8 ALLIANCE FINANCIAL GROUP BERHAD UNAUDITED CONDENSED STATEMENT OF CASH FLOWS - COMPANY FOR THE Unaudited Unaudited 9 Months 9 Months Ended Ended CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation 193, ,942 Adjustments for: Depreciation of property, plant and equipment Interest income from money at call and deposit placements with financial institutions (1,640) (1,491) Write-back of impairment losses on amount due from subsidiaries - (1,327) Share options/grants under ESS Gross dividend income from a subsidiary (192,439) (326,013) Operating (loss)/profit before working capital changes (147) 319 Changes in working capital: Receivables (1,937) 59 Payables (23) (35) Cash (used in)/generated from operations (2,107) 343 Taxes paid (866) (690) Net cash used in operating activities (2,973) (347) CASH FLOWS FROM INVESTING ACTIVITIES Amount due from subsidiaries 154 1,108 Amount due from a joint venture (8) (2) ESS recharge amount received from subsidiaries for share grants 4,546 6,715 ESS recharge amount received from joint venture for share grants 87 - ESS recharge amount received from subsidiaries for share options Interest received from deposits and placements with banks and other financial institutions 1,640 1,491 Purchase of property, plant and equipment (3) - Dividends received 192, ,013 Net cash generated from investing activities 198, ,008 CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid (219,497) (296,166) Proceeds from share option exercised 1,075 11,108 Amount due to subsidiaries Net cash used in financing activities (217,964) (285,022) NET CHANGE IN CASH AND CASH EQUIVALENTS (21,992) 50,639 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 75,357 17,801 CASH AND CASH EQUIVALENTS AT END OF PERIOD 53,365 68,440 Cash and cash equivalents comprise the following: (Company Number : 6627-X) (Incorporated in Malaysia) Cash and short-term funds 53,365 68,440 (The Condensed Statement of Cash Flows should be read in conjunction with the audited Annual Financial Statements for the financial year ended 31 March 2015) 8

9 [A] Explanatory Notes Pursuant To Malaysian Financial Reporting Standard 134 ("MFRS 134") : Interim Financial Reporting A1. Basis Of Preparation The unaudited condensed interim financial statements for the third financial quarter ended 31 December 2015 have been prepared under the historical cost convention, as modified by the available-for-sale financial assets, and financial assets and financial liabilities (including derivative instruments) at fair value through profit and loss. The unaudited condensed interim financial statements have been prepared in accordance with MFRS 134 "Interim Financial Reporting" issued by the Malaysian Accounting Standards Board ("MASB"), IAS 34 "Interim Financial Reporting" issued by the International Accounting Standards Board ("IASB") and Appendix 9B of the Bursa Malaysia Securities Berhad's ("Bursa Securities") Listing Requirements. The unaudited condensed interim financial statements should be read in conjunction with the audited annual financial statements of the for the financial year ended 31 March The explanatory notes attached to the interim financial statements provide an explanation of events and transactions that are significant to an understanding of the changes in the financial position and performance of the since the financial year ended 31 March The significant accounting policies and methods of computation applied in the unaudited interim financial statements are consistent with those adopted in the most recent audited annual financial statements for the financial year ended 31 March 2015, and modified for the adoption of the following accounting standards applicable for financial periods beginning on or after 1 April 2015: Amendments to MFRS 119 "Defined Benefit Plans: Employee Contributions" (effective 1 July 2014) Amendments to MFRSs contained in the document entitled "Annual Improvements to MFRSs Cycle" (effective 1 January 2015) - MFRS 2 "Share-based Payment" - MFRS 3 "Business Combinations" - MFRS 8 "Operating Segments" - MFRS 13 "Fair Value Measurement" - MFRS 116 "Property, Plant and Equipment" and MFRS 138 "Intangible Assets" - MFRS 124 "Related Party Disclosure" Amendment to MFRSs contained in the document entitled "Annual Improvements to MFRSs Cycle" (effective 1 January 2015) - MFRS 1 "First-time Adoption of Malaysian Financial Reporting Standards" - MFRS 3 "Business Combinations" - MFRS 13 "Fair Value Measurement" - MFRS 140 "Investment Property" The adoption of the above amendments to MFRSs and annual improvements to MFRSs do not have any material impact to the 's financial statements. 9

10 Explanatory Notes Pursuant To Malaysian Financial Reporting Standard 134 ("MFRS A1. Basis Of Preparation (contd.) The following MFRS have been issued by the MASB and are effective for annual period commencing on or after 1 April 2015, and have yet to be adopted by the : Amendments to MFRS 116 & MFRS 138 Clarification of Acceptable Methods of Depreciation and Amortisation (effective 1 January 2016) Amendments to MFRS 11 Accounting for Acquisition of Interests in Joint Operations (effective 1 January 2016) Amendments to MFRS 116 & MFRS 141 Agriculture: Bearer Plants (effective 1 January 2016) Amendments to MFRS 127 Equity Method in Separate Financial Statements (effective 1 January 2016) Annual Improvements to MFRSs (effective 1 January 2016) Amendments to MFRS 10, 12 & 128 Investment entities - Applying the Consolidation Exception (effective 1 January 2016) Amendments to MFRS 101 Presentation of financial statements - Disclosure Initiative (effective 1 January 2016) MFRS 15 Revenue from Contracts with Customer (effective 1 January 2018) MFRS 9 Financial Instruments (effective 1 January 2018) The preparation of unaudited condensed interim financial statements in conformity with the Malaysian Financial Reporting Standards requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed interim financial statements, and the reported amounts of revenues and expenses during the reported period. It also requires Directors to exercise their judgement in the process of applying the 's accounting policies. Although these estimates and judgements are based on the directors' best knowledge of current events and actions, actual results may differ. A2. Declaration Of Audit Confirmation The auditors' report on the audited annual financial statements for the financial year ended 31 March 2015 was not subject to any qualification. A3. Seasonal And Cyclical Factors The operations of the were not materially affected by any seasonal or cyclical fluctuations during the third financial quarter ended 31 December A4. Nature And Amount Of Items Affecting Assets, Liabilities, Equity, Net Income Or Cash Flows That Are Unusual Because Of Their Nature, Size Or Incidence The assets, liabilities, equity, net income and cash flows of the in the third financial quarter ended 31 December 2015 were not substantially affected by any item of a material and unusual nature. 10

11 A5. Explanatory Changes In Estimates Notes Pursuant To Malaysian Financial Reporting Standard 134 ("MFRS There were no material changes in estimates of amounts reported in prior financial years that have a material effect in the third financial quarter ended 31 December A6. Changes In Debt And Equity Securities Other than detailed below, there were no other issuance of equity securities, share buy-backs, share cancellations, shares held as treasury shares and resale of treasury shares for third financial quarter ended 31 December 2015:- (i) RM1.5 billion Thirty (30)-years Senior Medium Term Notes ("Senior-MTN") Programme (A1 rating by RAM Rating Services Berhad ("RAM")); Issuance Date Nominal Amount Tenure Coupon Rate 14 December 2015 RM5.0 million 2 years 4.75% p.a (ii) RM2.0 billion Thirty (30)-years Subordinated Medium Term Notes ("Sub-MTN") Programme (A2 rating by RAM); and Tranche Issuance Date Nominal Amount Tenure Call Date Coupon Rate First 27 October 2015 RM900.0 million Ten (10)-years 27 October % p.a Non-Callable Five and thereafter on (5)-years every coupon payment date Second 18 December 2015 RM300.0 million Ten (10)-years Non-Callable Five (5)-years 18 December 2020 and thereafter on every coupon payment date 5.65% p.a The Sub-MTN issued will qualify as Basel III compliant Tier 2 capital of ABMB pursuant to Bank Negara Malaysia ("BNM")'s Capital Adequacy Framework (Capital Components). The approval from BNM for the Sub-MTN Issuance had been obtained on 28 August 2015 (subject to the terms and conditions contained therein). (iii) RM500.0 million Seven (7)-years Commercial Papers ("CPs") Programme (P1 rating by RAM) Issuance Date Nominal Amount Tenure Discount Rate 27 November 2015 RM5.0 million 2 months 4.10% p.a A7. Dividends Paid A second single tier interim dividend of 6.4 sen per share, in respect of the financial year ended 31 March 2015, on 1,548,105,929 ordinary shares amounting to RM99,079,000 was paid on 30 June A first single tier interim dividend of 8.0 sen per share, in respect of the financial year ending 31 March 2016, on 1,548,105,929 ordinary shares amounting to RM123,848,000 was paid on 30 December Dividends paid on the shares held in Trust pursuant to the Company's ESS which are classified as shares held for ESS are not accounted for in the total equity. An amount of RM1,576,000 and RM1,854,000 being dividends paid for those shares were added back to the appropriation of retained profits in respect of the second single tier interim dividend and the first single tier interim dividend respectively. 11

12 A8. Explanatory Segment Information Notes Pursuant To Malaysian Financial Reporting Standard 134 ("MFRS The following segment information has been prepared in accordance with MFRS 8 "Operating Segments", which defines the requirements for the disclosure of financial information of an entity's operating segments. The operating segments results are prepared based on the 's internal management reporting reflective of the organisation's management reporting structure. Funds are allocated between segments and inter-segment funding cost transfers are reflected in net interest income. In addition to the operating segments, the segment information disclosed also includes inter-segment eliminations. Transactions between reportable segments are eliminated based on principles of consolidation as described in accounting policy. Intercompany transactions, balances and unrealised gains and losses on transactions between companies are eliminated in inter-segment eliminations. The is organised into the following key operating segments: (i) (ii) Consumer Banking Consumer Banking provides a wide range of personal banking solutions covering mortgages, term loans, personal loans, hire purchase facilities, credit cards, wealth management (cash management, investment services, share trading, bancassurance and will writing). Consumer banking customers are serviced via branch network, call centre, electronic/internet banking channels, and direct sales channels. Business Banking Business Banking segment covers Small and Medium Enterprise ("SME") and Wholesale Banking. SME Banking customers comprise self-employed, small and medium scale enterprises. Wholesale Banking serves public-listed and large corporate business customers including family-owned businesses. Business Banking provides a wide range of products and services including loans, trade finance, cash management, treasury and structured solutions. (iii) Financial Markets Financial Markets provide foreign exchange, money market, hedging and investment (capital market instruments) solutions for banking customers. It also manages the assets and liabilities, liquidity and statutory reserve requirements of the banking entities in the. (iv) Investment Banking Investment Banking covers stockbroking activities and corporate advisory which includes initial public offering, equity fund raising, debt fund raising, mergers and acquisitions and corporate restructuring. (v) Others Others refer to mainly other business operations such as unit trust, asset management, alternative distribution channels, trustee services and holding company operations. 12

13 A8. Segment Treasury Corporate Investment Others Information Operations Banking (contd.) Inter- Consumer Business Financial Investment Total segment Banking Banking Markets Banking Others Operations Elimination Total 3rd Financial Quarter Ended 31 December 2015 Net interest income/(expense) - external income 123,861 87,060 9,291 1, ,256 (6,444) 215,812 - inter-segment (39,263) 13,087 27,022 (846) , ,147 36, ,256 (6,444) 215,812 Net income from Islamic banking business 22,661 19,964 13, ,291 6,928 63,219 Other operating income 25,247 36,232 14,175 6, , ,769 (196,623) 82,146 Net income 132, ,343 64,154 6, , ,316 (196,139) 361,177 Other operating expenses (76,176) (60,479) (13,696) (9,829) (7,391) (167,571) 3,827 (163,744) Depreciation and amortisation (6,098) (4,045) (895) (166) (11) (11,215) - (11,215) Operating profit/(loss) 50,232 91,819 49,563 (3,247) 190, ,530 (192,312) 186,218 (Allowance made for)/write-back of losses on loans, advances and financing and other receivables (7,542) 3,219 (80) (15) - (4,418) (2,000) (6,418) Write-back of impairment - - 1, ,751-1,751 Segment result 42,690 95,038 51,234 (3,262) 190, ,863 (194,312) 181,551 Share of profit of equity-accounted joint venture, net of tax 19 Taxation (45,972) Net profit for the financial period 135,598 Segment assets 22,455,548 15,795,025 17,265, ,205 1,903,945 57,665,900 (3,761,976) 53,903,924 Reconciliation of segment assets to consolidated assets: Investment in a joint venture 677 Property, plant and equipment 90,597 Unallocated assets 53,174 Intangible assets 365,307 Total assets 54,413,679 Segment liabilities 20,964,637 18,556,103 11,057, ,264 16,209 50,783,463 (1,056,735) 49,726,728 Unallocated liabilities 15,567 Total liabilities 49,742,295 13

14 A8. Segment Information (contd.) Inter- Consumer Business Financial Investment Total segment Banking Banking Markets Banking Others Operations Elimination Total Nine months ended 31 December 2015 Net interest income/(expense) - external income 334, ,466 58,534 3,330 2, ,954 (11,253) 636,701 - inter-segment (93,525) 43,578 52,640 (2,693) , , , , ,954 (11,253) 636,701 Net income from Islamic banking business 67,418 56,439 38, ,091 20, ,823 Other operating income 78, ,915 45,747 17, , ,090 (208,183) 251,907 Net income 386, , ,155 18, ,615 1,270,135 (198,704) 1,071,431 Other operating expenses (221,324) (174,578) (41,417) (28,624) (16,809) (482,752) 7,715 (475,037) Depreciation and amortisation (17,954) (12,083) (2,772) (456) (36) (33,301) - (33,301) Operating profit/(loss) 147, , ,966 (10,813) 193, ,082 (190,989) 563,093 (Allowance made for)/write-back of losses on loans, advances and financing and other receivables (28,477) (12,239) (85) 7 - (40,794) (2,000) (42,794) Write-back of impairment - 3 2, ,427-2,427 Segment result 118, , ,305 (10,806) 193, ,715 (192,989) 522,726 Share of profit of equity-accounted joint venture, net of tax 139 Taxation (130,675) Net profit for the financial period 392,190 Segment assets 22,455,548 15,795,025 17,265, ,205 1,903,945 57,665,900 (3,761,976) 53,903,924 Reconciliation of segment assets to consolidated assets: Investment in a joint venture 677 Property, plant and equipment 90,597 Unallocated assets 53,174 Intangible assets 365,307 Total assets 54,413,679 Segment liabilities 20,964,637 18,556,103 11,057, ,264 16,209 50,783,463 (1,056,735) 49,726,728 Unallocated liabilities 15,567 Total liabilities 49,742,295 14

15 A8. Segment Information (contd.) Inter- Consumer Business Financial Investment Total segment Banking Banking Markets Banking Others Operations Elimination Total 3rd Financial Quarter Ended 31 December 2014 Net interest income/(expense) - external income 107,466 77,283 29,046 1,825 1, ,741 (3,222) 213,519 - inter-segment (25,701) 13,441 13,530 (1,270) ,765 90,724 42, , ,741 (3,222) 213,519 Net income from Islamic banking business 21,894 18,344 11, ,495 6,862 58,357 Other operating income 23,539 40,267 8,307 6, , ,521 (177,320) 78,201 Net income 127, ,335 62,140 6, , ,757 (173,680) 350,077 Other operating expenses (68,148) (52,057) (11,935) (10,467) (6,818)* (149,425) 2,647 (146,778) Depreciation and amortisation (5,469) (3,302) (932) (129) (13) (9,845) - (9,845) Operating profit/(loss) 53,581 93,976 49,273 (4,026) 171, ,487 (171,033) 193,454 (Allowance made for)/write-back of losses on loans, advances and financing and other receivables (10,022) (16,413) (649) (26,950) - (26,950) Write-back of impairment - 1, ,743-1,743 Segment result 43,559 79,306 48,624 (3,892) 171, ,280 (171,033) 168,247 Share of profit of equity-accounted joint venture, net of tax 8 Taxation (41,882) Net profit for the financial period 126,373 Segment assets 21,213,323 13,873,326 17,541, ,569 1,915,983 54,740,599 (3,988,651) 50,751,948 Reconciliation of segment assets to consolidated assets: Investment in a joint venture 506 Property, plant and equipment 95,615 Unallocated assets 32,148 Intangible assets 356,977 Total assets 51,237,194 Segment liabilities 19,130,814 16,643,658 12,390, ,723 15,741 48,283,540 (1,382,333) 46,901,207 Unallocated liabilities 8,734 Total liabilities 46,909,941 * Includes rationalisation cost of RM10,648,000 15

16 A8. Segment Information (contd.) Inter- Consumer Business Financial Investment Total segment Banking Banking Markets Banking Others Operations Elimination Total Nine months ended 31 December 2014 Net interest income/(expense) - external income 301, ,458 97,310 5,368 2, ,522 (10,043) 634,479 - inter-segment (55,938) 23,925 35,908 (3,895) , , ,218 1,473 2, ,522 (10,043) 634,479 Net income from Islamic banking business 62,756 50,880 32, ,186 20, ,847 Other operating income 83, ,665-32,902 19, , ,187 - (385,070) 274,117 Net income 392, , ,670 21, ,913 1,449,895 (374,452) 1,075,443 Other operating expenses (200,849) (160,480) (36,599) (32,566) (31,115)* (461,609) 9,191 (452,418) Depreciation and amortisation (15,981) (9,792) - (2,772) (419) (38) (29,002) - - (29,002) Operating profit/(loss) 175, , ,299 (11,715) 376, ,284 (365,261) 594,023 (Allowance made for)/write-back of losses on loans, advances and financing and other receivables (39,086) 16, (22,114) - (22,114) Write-back of impairment - 4, ,827 8,016 (1,327) 6,689 Segment result 136, , ,142 (10,899) 379, ,186 (366,588) 578,598 Share of profit of equity-accounted joint venture, net of tax 14 Taxation (141,101) Net profit for the financial period 437,511 Segment assets 21,213,323 13,873,326 17,541, ,569 1,915,983 54,740,599 (3,988,651) 50,751,948 Reconciliation of segment assets to consolidated assets: Investment in a joint venture 506 Property, plant and equipment 95,615 Unallocated assets 32,148 Intangible assets 356,977 Total assets 51,237,194 Segment liabilities 19,130,814 16,643,658 12,390, ,723 15,741 48,283,540 (1,382,333) 46,901,207 Unallocated liabilities 8,734 Total liabilities 46,909,941 * Includes rationalisation cost of RM10,648,000 16

17 A9. Material Event During The Financial Reporting Period (a) Employees Share Scheme ( ESS ) On 22 June 2015, the Company awarded share grants to employees of the Company and its subsidiaries who have met the criteria of eligibility for the participation in the ESS. A total 1,844,700 shares were awarded under the Share Grant Plan. The first 33.0% of the share grants are to be vested at the end of the first year and the remaining 67.0% of the share grants are to be vested at the end of the second year from the date on which the award was made. The Company operates an equity-settled, share-based compensation plan pursuant to the ESS. Under the MFRS2 'Share-based Payment', the compensation expense relating to the share scheme is recognised in profit or loss over the vesting periods of the grants with a corresponding increase in equity. (b) Shares Purchased pursuant to ESS During the nine months ended 31 December 2015, the Trustee of the ESS had not purchased any shares in the Company from the open market. In the nine months ended 31 December 2015, 1,704,650 shares have been vested and transferred from the Trustee to the eligible employees of the Company and its subsidiaries in accordance with the terms under the Share Grant Plan and Share Option Plan of the ESS. As at 31 December 2015, the Trustee of the ESS held 23,173,250 ordinary shares representing 1.50% of the issued and paid-up capital of the Company. (c) Establishment of New Debt Issuance Programmes On 21 September 2015, the Company announced that Alliance Bank Malaysia Berhad ("ABMB"), a wholly-owned subsidiary of the Company has established the following New Debt Issuance Programmes: (i) (ii) (iii) RM1.5 billion Thirty (30)-years Senior-MTN Programme; RM2.0 billion Thirty (30)-years Sub-MTN Programme; and RM500.0 million Seven (7)-years CPs Programme A10. Material Events Subsequent To The End Of The Financial Reporting Period There was no material event subsequent to the end of the financial reporting period that require disclosure or adjustment to the unaudited condensed interim financial statements. A11. Changes In The Composition Of The The wholly-owned subsidiaries of the Company, Pridunia Sdn. Bhd. and Alliance Investment Futures Sdn. Bhd., have been dissolved with effect from 9 December 2015 by way of Members' Voluntary Winding-Up pursuant to Section 272(5) of the Companies Act, A12. Changes In Contingent Liabilities Since The Last Annual Financial Reporting Date Please refer to Note A30. 17

18 A13. Interest Income 3rd Quarter Ended Cumulative 9 Months Ended Loans, advances and financing 378, ,769 1,104,205 1,002,368 Money at call and deposit placements with financial institutions 1,569 4,524 7,462 21,186 Financial assets held-for-trading 1, , Financial investments available-for-sale 84,463 78, , ,861 Financial investments held-to-maturity 6,781 6,772 20,197 20,223 Others 2,510 2,385 8,003 7, , ,633 1,377,504 1,288,635 Accretion of discount less amortisation of premium 17,448 17,509 50,100 51, , ,142 1,427,604 1,340,382 Company Money at call and deposit placements with financial institutions ,640 1,491 A14. Interest Expense 3rd Quarter Ended Cumulative 9 Months Ended Deposits and placements of banks and other financial institutions 18,634 19,028 42,660 61,446 Deposits from customers 234, , , ,914 Securities sold under repurchase agreements Other borrowings Subordinated obligations 17,438 7,392 32,224 22,164 Others 6,463 4,802 17,938 12, , , , ,903 A15. Net Income From Islamic Banking Business 3rd Quarter Ended Cumulative 9 Months Ended Income derived from investment of depositors' funds and others 109,740 96, , ,347 Income derived from investment of Islamic Banking funds 9,784 8,633 27,811 24,973 Income attributable to depositors and financial institutions (63,233) (53,815) (184,829) (145,133) 56,291 51, , ,187 Add: Income due to head office eliminated at level 6,928 6,861 20,732 20,660 63,219 58, , ,847 18

19 A16. Other Operating Income 3rd Quarter Ended Cumulative 9 Months Ended Fee and commission income: Commissions 19,766 19,108 59,316 59,619 Service charges and fees 9,130 8,625 23,449 24,438 Portfolio management fees Corporate advisory fees , Brokerage fees 8,495 9,558 25,591 30,939 Guarantee fees 3,793 3,672 11,014 10,168 Processing fees 2,060 2,284 6,012 12,635 Commitment fees 3,852 3,889 11,652 11,477 Underwriting commissions Other fee income 27,046 27,325 77,181 88,992 75,137 74, , ,273 Fee and commission expense: Commissions expense (642) (504) (1,430) (1,650) Guarantee fees expense (255) (225) (888) (731) Brokerage fees expense (3,958) (4,520) (12,202) (15,205) Other fee expense (23,169) (23,894) (68,080) (68,152) (28,024) (29,143) (82,600) (85,738) Investment income: Gain/(loss) arising from sale/redemption of: - Financial assets held-for-trading (1,260) 7 - Financial investments available-for-sale 1, ,337 15,092 Marked-to-market revaluation of: - Financial assets held-for-trading Derivative financial instruments (48,435) 84,725 (16,880) 112,461 - Unrealised gain arising from financial liabilities designated at fair value (3,075) - 19,155 - Realised gain/(loss) on derivative financial instruments 77,554 (69,695) 82,184 (59,548) Gross dividend income from: - Financial investments available-for-sale ,145 2,179 28,830 15,865 89,154 70,233 Other income: Foreign exchange (loss)/gain (2,111) 8,078 7,133 6,521 Gain/(loss) on disposal of property, plant and equipment 1 - (11) 1 Gain on disposal of non-current assets held for sale ,605 Others 8,313 8,632 22,341 22,222 6,203 16,710 29,463 50,349 Total other operating income 82,146 78, , ,117 Company Investment income: Gross dividend income from: - Subsidiary 125, , , ,013 Other income: Others ,970 2,267 Total other operating income 125, , , ,280 19

20 A17. Other Operating Expenses 3rd Quarter Ended Cumulative 9 Months Ended Personnel costs Salaries, allowances and bonuses 86,016 73, , ,921 Contribution to EPF 13,556 12,384 39,827 37,654 Share options/grants under ESS 1,566 (360) 5,457 5,990 Others 10,044 9,565 26,188 36, ,182 95, , ,559 Establishment costs Depreciation of property, plant and equipment 5,724 5,332 17,235 15,558 Amortisation of computer software 5,491 4,513 16,066 13,444 Rental of premises 7,571 6,984 22,984 20,898 Water and electricity 2,024 2,277 6,182 7,114 Repairs and maintenance 2,455 2,944 6,568 8,308 Information technology expenses 9,848 10,848 31,097 29,358 Others 3,486 4,045 10,642 12,304 36,599 36, , ,984 Marketing expenses Promotion and advertisement 1,760 1,508 4,621 4,497 Branding and publicity 2,612 4,508 6,269 11,521 Others 2,099 2,094 6,055 6,078 6,471 8,110 16,945 22,096 Administration and general expenses Communication expenses 3,103 3,540 9,512 10,638 Printing and stationery 601 1,136 2,202 3,024 Insurance 5,056 2,549 17,242 7,448 Professional fees 5,250 5,032 12,856 14,765 Others 6,697 3,927 18,481 14,906 20,707 16,184 60,293 50,781 Total other operating expenses 174, , , ,420 Company Personnel costs Salaries, allowances and bonuses Contribution to EPF Share options/grants under ESS 33 (16) Others Establishment costs Depreciation of property, plant and equipment Rental of premises Water and electricity Repairs and maintenance Information technology expenses Others Administration and general expenses Communication expenses Printing and stationery Professional fees Others ,056 1, ,157 1,221 Total other operating expenses ,317 2,156 20

21 A18. Allowance Made for Losses On Loans, Advances And Financing And Other Receivables 3rd Quarter Ended Cumulative 9 Months Ended Allowance made for losses on loans, advances and financing and other receivables: (a) Individual assessment allowance - made during the period, (net) 4,616 2,996 14, (b) Collective assessment allowance - made during the period, (net) 7,814 28,645 41,548 55,906 (c) Bad debts on loans and financing - Recovered (11,146) (9,327) (28,727) (48,575) - Written off 4,425 3,997 12,441 12,983 5,709 26,311 39,818 20,952 Allowance for other receivables ,976 1,162 6,418 26,950 42,794 22,114 A19. Balances Due From Clients And Brokers Due from clients 191,239 60,289 Due from brokers - 43, , ,583 Less: Allowance made for the period/year (838) (840) 190, ,743 These represent amounts receivable by Alliance Investment Bank Berhad ("AIBB") from non-margin clients and outstanding contracts entered into on behalf of clients where settlement via the Bursa Malaysia Securities Clearing Sdn. Bhd. has yet to be made. AIBB's normal trade credit terms for non-margin clients is three (3) market days in accordance with the Bursa Malaysia Securities Berhad's ("Bursa") Fixed Delivery and Settlement System ("FDSS") trading rules. Included in the balances due from clients and brokers are impaired accounts, as follows: Classified as doubtful Classified as bad ,055 21

22 A19. Balances Due From Clients And Brokers (contd.) The movements in allowance made for the period/year are as follows: At beginning of year 840 1,194 Write-back during the period/year, (net) (2) (354) At end of period/year A20. Financial Assets Held-for-trading At fair value Money market instruments Malaysian Government securities 59,669 - Commercial Paper 9,979 - Unquoted securities Medium term notes 115,918 10,037 Total financial assets held-for-trading 185,566 10,037 A21. Financial Investments Available-for-sale At fair value Money market instruments Malaysian Government securities 1,942,580 2,607,781 Malaysian Government investment certificates 2,463,255 2,723,129 Negotiable instruments of deposits 3,303,283 1,241,534 Bankers' acceptances - 105,531 Khazanah bonds 200, ,349 7,909,179 6,872,324 Quoted securities in Malaysia Shares Accumulated impairment (11) (11) Unquoted securities Shares 153, ,651 Accumulated impairment (1,440) (1,440) 152, ,211 Debt securities and medium term notes 3,116,143 2,979,271 Unit Trust Funds 4,989 - Accumulated impairment (237,211) (237,961) 2,883,921 2,741,310 3,036,261 2,881,521 Total financial investment available-for-sale 10,945,458 9,753,856 22

23 A22. Financial Investments Held-to-maturity At amortised cost Money market instruments Malaysian Government securities 703, ,521 Malaysian Government investment certificates 231, ,739 Khazanah bonds 188, ,932 1,123,966 1,309,192 At cost Unquoted securities Debt securities 24,143 37,668 Accumulated impairment (14,231) (27,825) 9,912 9,843 Total financial investments held-to-maturity 1,133,878 1,319,035 A23. Loans, Advances And Financing Overdrafts 2,363,934 2,142,270 Term loans/financing - Housing loans/financing 14,754,633 14,257,710 - Syndicated term loans/financing 401, ,427 - Hire purchase receivables 1,391,776 1,564,527 - Other term loans/financing 12,916,693 11,751,901 Bills receivables 334, ,866 Trust receipts 186, ,437 Claims on customers under acceptance credits 2,473,927 2,567,211 Staff loans [including loans to Directors of a banking subsidiary of RM131,000 ( : RM155,000)] 34,964 37,691 Credit/charge card receivables 680, ,068 Revolving credits 1,640,476 1,467,301 Share margin financing 1,470,882 1,566,703 Gross loans, advances and financing 38,649,869 36,923,112 Add: Sales commissions and handling fees 36,295 33,927 Less: Allowance for impairment on loans, advances and financing - Individual assessment allowance (59,537) (56,303) - Collective assessment allowance (329,481) (334,704) Total net loans, advances and financing 38,297,146 36,566,032 23

24 A23. Loans, Advances And Financing (contd.) (a) By type of customer Domestic non-bank financial institutions 480, ,252 Domestic business enterprises - Small and medium enterprises 8,501,844 7,481,367 - Others 7,149,342 6,890,104 Government and statutory bodies 7,185 8,258 Individuals 21,464,152 20,866,962 Other domestic entities 205, ,146 Foreign entities 840, ,023 Gross loans, advances and financing 38,649,869 36,923,112 (b) By interest/profit rate sensitivity Fixed rate - Housing loans/financing 48,263 57,528 - Hire purchase receivables 1,344,526 1,512,488 - Other fixed rate loans/financing 2,621,108 2,248,229 Variable rate - Base lending rate plus 27,337,507 26,582,088 - Base rate plus 621,659 29,334 - Cost plus 6,407,456 6,253,494 - Other variable rate loans/financing 269, ,951 Gross loans, advances and financing 38,649,869 36,923,112 (c) By economic purposes Purchase of securities 1,492,152 1,597,174 Purchase of transport vehicles 1,252,087 1,426,986 Purchase of landed property 22,457,502 21,587,935 of which: - Residential 15,731,728 15,137,475 - Non-residential 6,725,774 6,450,460 Purchase of fixed assets excluding land and buildings 201, ,585 Personal use 2,518,006 2,276,090 Credit card 680, ,068 Construction 661, ,122 Merger and acquisition 117, ,687 Working capital 6,911,669 6,623,099 Others 2,358,070 1,867,366 Gross loans, advances and financing 38,649,869 36,923,112 24

25 A23. Loans, Advances And Financing (contd.) (d) By geographical distribution Northern region 2,474,169 2,413,727 Central region 27,897,223 26,845,424 Southern region 4,570,646 4,246,477 Sabah region 2,675,342 2,634,948 Sarawak region 1,032, ,536 Gross loans, advances and financing 38,649,869 36,923,112 (e) By maturity structure Within one year 9,203,917 8,508,239 One year to three years 1,378,886 1,426,070 Three years to five years 2,027,729 1,825,760 Over five years 26,039,337 25,163,043 Gross loans, advances and financing 38,649,869 36,923,112 (f) Movements in impaired loans, advances and financing ("impaired loans") are as follows: At beginning of year 380, ,781 Impaired during the period/year 461, ,569 Reclassified as unimpaired during the period/year (255,321) (412,159) Recoveries (110,592) (235,458) Amount written off (58,093) (103,021) At end of period/year 418, ,712 Individual allowance for impairment (59,537) (56,303) Collective allowance for impairment (impaired portion) (101,744) (102,533) Net impaired loans, advances and financing 256, ,876 Gross impaired loans as a percentage of gross loans, advances and financing 1.1% 1.0% 25