Annual Report. ...meeting the challenge.

Transcription

1 Annual Report...meeting the challenge.

2 The humble coil, also commonly known as a spring is the inspiration for this year s Annual Report cover. A piece of resilient elastic metal known for its capacity to expand and contract, absorb pressure yet able to return to its original state, this metal spring is symbolic of the companies within the BHB Group. As the Group ventures forward amidst a volatile and increasingly competitive global economy, we tap on our innate ability to adapt to meet the oncoming challenges. We also leverage on our collective strengths and resources, synergising to capitalise on the opportunities before us and deliver value to our stakeholders.

3 Contents Notice of the Twelfth Annual General Meeting 2 Statement Accompanying Notice of Annual General Meeting 4 Corporate Profile 5 Corporate Information 6 Group Corporate Structure 7 Directors Profile 8 CEOs in the Group 11 Letter to Shareholders 13 Operational Highlights 18 5-years Group Financial Highlights 24 Corporate Responsibility /2009 Highlights 30 Statement of Corporate Governance 32 Statement on Internal Control 43 Additional Compliance Information 45 Financial Statements 49 Properties Owned by the BHB Group 120 Shareholding Statistics 130 Regional Group Network 133 Proxy Form Annual Report

4 Notice of the Twelfth Annual General Meeting NOTICE IS HEREBY GIVEN that the twelfth (12th) ANNUAL GENERAL MEETING of BIMB Holdings Berhad will be held at Tun Rahah Grand Hall, Level 1, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur on Monday, 23 November 2009 at a.m. for the following purposes: As Ordinary Business 1. To receive the Audited Accounts for the financial year ended 30 June 2009 together with the Reports of the Directors and Auditors thereon. (Resolution 1) 2. To declare a first and final dividend of 1.20% less income tax of 25% for the financial year ended 30 June (Resolution 2) 3. To re-elect the following Directors who retire by rotation in accordance with Article 61 of the Company s Articles of Association: a) Tan Sri Samsudin Osman (Resolution 3) b) Dato Hairuddin Mohamed (Resolution 4) 4. To re-appoint Dato Dr. Abdul Halim Ismail, a director who is retiring pursuant to Section 129 of the Companies Act, 1965, to hold office until the conclusion of the next Annual General Meeting of the Company. (Resolution 5) 5. To approve payment of Directors fees for the financial year ended 30 June (Resolution 6) 6. To re-appoint Messrs. KPMG Desa Megat & Co. as Auditors of the Company and to authorise the Directors to fix their remuneration. (Resolution 7) As Special Business 7. Proposed Renewal of Shareholders Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature. That subject to the Companies Act 1965, Memorandum and Articles of Association of the Company and the Listing Requirements of Bursa Malaysia Securities Berhad approval be and is hereby given to BIMB Holdings Berhad and its subsidiaries to enter into the category of recurrent related party transactions of a revenue or trading nature with those related parties as specified in Section 2.2 of the Circular to Shareholders dated 30 October 2009 which are necessary for the Group s day to day operations subject to the following:- i. The transactions carried out are in the ordinary course of business and on normal commercial terms that do not favour the related parties more than the general public; ii. Are not detrimental to the minority shareholders of the Company; and iii. Disclosure of the aggregate value of transactions conducted during the financial year pursuant to the shareholders mandate during the financial year (Mandate) will be made in the annual report for the said financial year. And that the Mandate conferred by this resolution shall commence immediately upon the passing of this Resolution; 2 Annual Report 2009

5 NOTICE OF THE TWELFTH ANNUAL GENERAL MEETING And that such Mandate shall continue to be in force until:- a. the conclusion of the next Annual General Meeting of the Company, at which time it will lapse, unless by a resolution passed at the meeting, the authority is renewed; b. the expiration of the period within which the next Annual General Meeting after the date is required to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of Companies Act, 1965); or c. it is revoked or varied by a resolution passed by the shareholders in a general meeting. whichever is the earlier. (Resolution 8) 8. To transact any other ordinary business of which due notice shall have been given in accordance with the Companies Act, Notice of Book Closure NOTICE IS HEREBY GIVEN that the register of members will be closed from 10 to 11 December 2009 (both dates inclusive) to determine shareholders entitlement to the dividend payment. The dividend, if approved, by the shareholders at the twelfth Annual General Meeting, will be paid on 17 December 2009 to shareholders whose names appear in the register of members or record of depositors on 9 December FURTHER NOTICE IS HEREBY GIVEN that a depositor shall qualify for dividend entitlement only in respect of: a) Shares transferred to the depositor s securities account before 4.00 p.m. on 9 December 2009 in respect of ordinary transfer. b) Shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis according to the rules of Bursa Malaysia Securities Berhad. By Order of the Board SAIFUL NIZAM BIN YASIN (LS 08955) Company Secretary Kuala Lumpur 30 October 2009 Notes : 1. A member of the Company entitled to attend and vote at the meeting may appoint a proxy or proxies to attend and vote instead of himself. 2. The instrument appointing a proxy shall:- i) in case of individual, be signed by the appointer or by his attorney; and ii) in case of a corporation be either under its common seal or signed by its attorney or by an officer on behalf of the corporation. 3. Where a member appoints more than one (1) proxy the appointment shall specify the proportions of his holdings to be represented by each proxy. 4. All proxy forms should be deposited at the Company s Registered Office, Level 18, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur not less than forty-eight (48) hours before the time fixed for holding of the meeting or any adjournment thereof. 5. Explanatory Note to the Special Business i) The Ordinary Resolution 8, please refer to the Circular to Shareholders dated 30 October Annual Report

6 Statement Accompanying Notice of Annual General Meeting Statement Pursuant to Paragraph 8.27(2) of the Listing Requirements of Bursa Malaysia Securities Berhad 1. The Directors who are standing for re-election at the twelfth Annual General Meeting of the Company are as follow:- That Tan Sri Samsudin Osman and Dato Hairuddin Mohamed who retire by rotation pursuant to Article 61 of the Company s Articles of Association and seeking re-election. That Dato Dr. Abdul Halim Ismail, retires pursuant to Section 129 of the Companies Act, 1965 and seeking re-appointment. The details of all the Directors seeking re-election and re-appointment are set out in the Directors Profile which appear on pages 8 to 10 of the Annual Report. 4 Annual Report 2009

7 Corporate Profile BIMB Holdings Berhad ( BHB ) is an investment holding company which operates along Islamic principles. It holds broad appeal for investors and customers because of its reputation for ethical practices. BHB was incorporated in Malaysia on 20 March 1997, and was listed on the Main Market of the Bursa Malaysia Securities Berhad (formerly known as Kuala Lumpur Stock Exchange) on 16 September in the same year. The authorised capital of BHB is RM2 billion while its paid-up capital is RM1,066,789,896. The core subsidiaries of the BHB Group are leaders in various Islamic financial service activities including banking, takaful, stockbroking, and other related services. Annual Report

8 Corporate Information BOARD OF DIRECTORS Tan Sri Samsudin bin Osman Non-Independent Non-Executive Director/Chairman Encik Johan bin Abdullah Group Managing Director/Chief Executive Officer Non-Independent Executive Director Dato Mohd Bakke bin Salleh Independent Non-Executive Director Datuk Ismee bin Ismail Non-Independent Non-Executive Director Dato Dr. Abdul Halim bin Ismail Non-Independent Non-Executive Director Encik Mohd Zin bin Idris Independent Non-Executive Director Encik Salih Amaran bin Jamiaan Non-Independent Non-Executive Director Puan Zaiton binti Mohd Hassan Independent Non-Executive Director Dato Hairuddin bin Mohamed Independent Non-Executive Director SHARIAH SUPERVISORY COUNCIL BANK ISLAM MALAYSIA BERHAD Dr. Ahmad Sobri bin Salamon Ustaz Mohd Bakir bin Haji Mansor Y.A.A. Dato Hj. Daud bin Muhammad Prof. Madya Dr. Yusof bin Ramli SHARIAH ADVISORY BODY SYARIKAT TAKAFUL MALAYSIA BERHAD Dr. Ahmad Sobri bin Salamon Datuk Abdul Hamid bin Said Ustaz Mohd Bakir bin Haji Mansor Dr. Aida binti Othman SHARIAH COMMITTEE BIMB SECURITIES SDN BHD Prof. Dato Paduka Dr. Mahmood Zuhdi bin Hj. A. Majid Dato Dr. Abdul Halim bin Ismail Ustaz Mohd Bakir bin Haji Mansor NOMINATION AND ASSESSMENT COMMITTEE Chairman Dato Mohd Bakke bin Salleh Members Datuk Ismee bin Ismail Encik Mohd Zin bin Idris Puan Zaiton binti Mohd Hassan REMUNERATION COMMITTEE Chairman Dato Mohd Bakke bin Salleh Members Datuk Ismee bin Ismail Encik Mohd Zin bin Idris Puan Zaiton binti Mohd Hassan SPECIAL BOARD COMMITTEE Chairman Dato Hairuddin bin Mohamed Members Encik Mohd Zin bin Idris Dato Zukri bin Samat AUDIT AND EXAMINATION COMMITTEE Chairman Encik Mohd Zin bin Idris Members Encik Salih Amaran bin Jamiaan Puan Zaiton binti Mohd Hassan Dato Hairuddin bin Mohamed CEOs IN THE GROUP Encik Johan bin Abdullah Group Managing Director/Chief Executive Officer Dato Zukri bin Samat Managing Director Bank Islam Malaysia Berhad Dato Mohamed Hassan bin Md Kamil Group Managing Director Syarikat Takaful Malaysia Berhad Dato Idris bin Md Tahir Chief Executive Officer/Executive Director (Operations) BIMB Securities Sdn. Bhd. COMPANY SECRETARY Encik Saiful Nizam bin Yasin (LS 08955) AUDITORS KPMG Desa Megat & Co (AF 0759) Level 10, KPMG Tower 8 First Avenue, Bandar Utama Petaling Jaya, Selangor REGISTERED OFFICE Level 18, Menara Yayasan Tun Razak 200 Jalan Bukit Bintang Kuala Lumpur Tel: Fax: website: SHARE REGISTRAR Symphony Share Registrars Sdn Bhd Level 26, Menara Multi-Purpose Capital Square No 8, Jalan Munshi Abdullah Kuala Lumpur STOCK EXCHANGE LISTING Main Market of Bursa Malaysia Securities Berhad 16 September Annual Report 2009

9 Group Corporate Structure t as at 30 June 2009 Banking Takaful Stock & Share Broking Leasing of Assets Investment Holdings - Venture Capital Others 51% Bank Islam Malaysia Berhad 65.22% Syarikat Takaful Malaysia Berhad 100% 0% BIMB Securities (Holdings) Sdn. Bhd. 100% 0% Syarikat Al-Ijarah Sdn. Bhd. 100% 0% 51% BIMB Venture Pembiayaan Capital Sdn. Bhd. # Perumahan Nasional Sdn. Bhd. # 100% 0% Al-Wakalah Nominees (Tempatan) Sdn. Bhd % ASEAN Retakaful International (L) Ltd 100% 0% BIMB Securities Sdn. Bhd. 100% 0% 48% BIMB Musyarakah Islamic Banking & Satu Sdn. Bhd. Finance Institute Malaysia Sdn. Bhd. * 100% 0% BIMB Investment Management Berhad (formerly known as BIMB Unit Trust Management Berhad) 100% 0% BIMB Foreign Currency Clearing Agency Sdn. Bhd % P.T. Syarikat Takaful Indonesia 64.70% P. T. Asuransi Takaful Umum 74.78% P. T. Asuransi Takaful Keluarga 100% 0% BIMSEC Nominees (Asing) Sdn. Bhd. 100% 0% BIMSEC Nominees (Tempatan) Sdn. Bhd. 100% 0% BIMSEC Asset Management Sdn. Bhd. 100% 0% Bank Islam (L) Ltd ^ 100% 0% BIMB Trust Company (Labuan) Ltd 100% 0% BIMB Offshore Company Management Services Sdn. Bhd. * Associate Company # In the process of liquidation via member s voluntary winding-up ^ Ceased operations Annual Report

10 Directors Profile Tan Sri Samsudin bin Osman Tan Sri Samsudin, a Malaysian, aged 62, is a Non-Independent Non-Executive Director and the Chairman of BIMB Holdings Berhad. He was appointed to the Board on 1 February He holds a Masters in Public Administration from Pennsylvania State University (USA), a Bachelor of Arts (Honours) and a Diploma in Public Administration from University of Malaya. From 2001 to 2006, Tan Sri Samsudin was the Chief Secretary to the Government of Malaysia. Tan Sri Samsudin is presently the President of Perbadanan Putrajaya. He is also the Chairman of the Employees Provident Fund ( EPF ) Board, EPF Investment Panel, University Utara Malaysia and a Director of Sime Darby Bhd. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB except by virtue of being a Nominee Director of Lembaga Tabung Haji. He has not been convicted of any offence within the past ten (10) years. He attended all the six (6) Board Meetings held in the financial year. Encik Johan bin Abdullah Encik Johan, a Malaysian, aged 53, is the Group Managing Director/Chief Executive Officer and a Non-Independent Executive Director. He was appointed to the Board on 15 May He holds a Masters in Business Administration (Finance) from Morehead State University (USA), a Bachelor of Business Administration (Finance) from Eastern Michigan University (USA) and a Diploma in Banking from University Technology MARA. Encik Johan started his professional career in 1987 with the Kuala Lumpur Stock Exchange (currently known as Bursa Malaysia Berhad) as a Listing Officer. In 1989, he joined the Corporate Finance Division of Bumiputra Merchant Bankers Berhad and left the Bank in early 1995 as Senior Manager. Later he joined Damansara Realty Berhad as General Manager, Corporate Planning. Subsequently in the year 1999, he re-joined Bursa Malaysia Berhad and took up various senior positions including that of Deputy Chief Regulatory Officer, Group Regulation. In May 2008, he joined BIMB Holdings Berhad as Group Managing Director/Chief Executive Officer. Encik Johan is a director of Bank Islam Malaysia Berhad, Syarikat Takaful Malaysia Berhad, BIMB Securities Sdn Bhd and Islamic Banking and Finance Institute Malaysia Sdn. Bhd. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB. He has not been convicted of any offence within the past ten (10) years. He attended all the six (6) Board Meetings held in the financial year. Dato Mohd Bakke bin Salleh Dato Mohd Bakke, a Malaysian, aged 55, is an Independent Non-Executive Director. He was appointed to the Board on 3 June He holds a Bachelor of Science (Economics) degree from the London School of Economics and Political Science and is a Fellow of the Institute of Chartered Accountants in England and Wales. He is also a member of the Malaysian Institute of Accountants. He is presently the Group Managing Director of Felda Holdings Berhad and was formerly the Group Managing Director and Chief Executive Officer of Lembaga Tabung Haji. Currently, Dato Mohd Bakke is the Chairman of Bank Islam Malaysia Berhad and a Commission Member of the Securities Commission Malaysia. In BHB, Dato Mohd Bakke serves as Chairman of the Nomination and Assessment Committee and Remuneration Committee of the Board. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB. He has not been convicted of any offence within the past ten (10) years. He attended five (5) out of six (6) Board Meetings held in the financial year. 8 Annual Report 2009

11 DIRECTORS PROFILE Datuk Ismee bin Ismail Datuk Ismee, a Malaysian, aged 44, is a Non-Independent Non-Executive Director. He was appointed to the Board on 9 October He is an associate member of the Chartered Institute of Management Accountants and a member of the Malaysian Institute of Accountants. Datuk Ismee is presently the Group Managing Director and Chief Executive Officer of Lembaga Tabung Haji ( LTH ). Prior to joining LTH, he was the Chief Executive Officer of ECM Libra Securities and a Director of ECM Libra Capital Sdn. Bhd. He has also served several organisations in various different capacities. He was Senior General Manager of Finance of LTH; Chief Accountant at Pengurusan Danaharta Nasional Berhad; and General Manager of Business Development at Arab Malaysian Development Berhad. He also held several finance-related positions at Shell Malaysia. Datuk Ismee is a Director of Bank Islam Malaysia Berhad and TH Plantations Berhad. He is a member of the Nomination and Assessment Committee and Remuneration Committee of the Board. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB except by virtue of being a nominee director of LTH. He has not been convicted of any offence within the past ten (10) years. He attended five (5) out of six (6) Board Meetings held in the financial year. Dato Dr. Abdul Halim bin Ismail Dato Dr. Abdul Halim, a Malaysian, aged 70, is a Non-Independent Non-Executive Director. He was appointed to the Board on 21 August He holds a Bachelor of Arts (Honours) from the University of Malaya and a Doctor of Philosophy (DPhil) in Economics from Oxford University, England. Dato Dr. Abdul Halim was formerly the Managing Director of Bank Islam Malaysia Berhad. He is presently the Executive Director of BIMB Securities Sdn. Bhd. He is also a Director of Institut Kefahaman Islam Malaysia, Sime Darby Berhad as well as a member of the Shariah Advisory Councils of both the Securities Commission Malaysia and Bank Negara Malaysia. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB except by virtue of being a Nominee Director of Permodalan Nasional Berhad. He has not been convicted of any offence within the past ten (10) years. He attended all the six (6) Board Meetings held in the financial year. Encik Mohd Zin bin Idris Encik Zahari, a Malaysian, aged 66, is an Independent Non-Executive Director. He was appointed to the Board on 20 September He holds a Senior Cambridge Certificate. Encik Zahari began his career with Malayan Banking Berhad ( Maybank ), where between 1962 to 1996, he has held various senior positions in Maybank, including that of General Manager, Commercial Banking Division (last position held). From 2000 to 2005, Encik Zahari was the Managing Director of Inter-City MPC (M) Sdn. Bhd. Encik Zahari is presently a Director of Bank Islam Malaysia Berhad. He is also the Chairman of the Audit and Examination Committee, a member of the Nomination and Assessment Committee, Remuneration Committee and Special Board Committee of the Board. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB. He has not been convicted of any offence within the past ten (10) years. He attended all the six (6) Board Meetings held in the financial year. Annual Report

12 DIRECTORS PROFILE Encik Salih Amaran bin Jamiaan Encik Salih Amaran, a Malaysian, aged 69, is a Non-Independent Non-Executive Director. He was appointed to the Board on 18 February He holds a Masters in Business Administration from Wharton, University of Pennsylvania (USA), a Diploma in Public Administration from Victoria University, Wellington and a Bachelor of Science (Economics) from London School of Economics, University of London. He is a member of the Audit and Examination Committee of the Board. He has served as the former Deputy Secretary, Finance Division at the Malaysian Ministry of Finance; General Manager, International Banking Division of Malayan Banking Berhad; Special Advisor (Economics) of the Commonwealth Secretariat, London; and Deputy Director, Trade Finance and Promotion Department of the Islamic Development Bank ( IDB ) in Jeddah. From 2000 to 2002, he was the Regional Representative of the IDB for Brunei, Indonesia and Malaysia based in Kuala Lumpur. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB except by virtue of being a Nominee Director of Permodalan Nasional Berhad. He has not been convicted of any offence within the past ten (10) years. He attended all the six (6) Board Meetings held in the financial year. Puan Zaiton binti Mohd Hassan Puan Zaiton, a Malaysian, aged 53, is an Independent Non-Executive Director. She was appointed to the Board on 2 February Puan Zaiton is a Fellow of the Association of Chartered Certified Accountants and a member of the Malaysian Institute of Certified Public Accountants. Puan Zaiton is presently the Managing Director of Capital Intelligence Advisors Sdn. Bhd. She was formerly the President/ Executive Director of Malaysian Rating Corporation Berhad ( MARC ). Prior to joining MARC, Puan Zaiton served 12 years with Maybank in various senior positions including that of General Manager, Group Strategic Planning, a post she held until her resignation in Puan Zaiton is presently a Director of Bank Islam Malaysia Berhad, Malaysian Industrial Development Finance Berhad, Credit Guarantee Corporation Malaysia Berhad and a Commission Member of the Companies Commission of Malaysia. Puan Zaiton is a member of the Audit and Examination Committee, Nomination and Assessment Committee and Remuneration Committee of the Board. She does not have any family relationship with any Director and/or major shareholder of BHB nor does she have any conflict of interest with BHB. She has not been convicted of any offence within the past ten (10) years. She attended five (5) out of six (6) Board Meetings held in the financial year. Dato Hairuddin bin Mohamed Dato Hairuddin, a Malaysian, aged 59, is an Independent Non-Executive Director. He was appointed to the Board on 9 October He holds a Bachelor of Social Science (Honours) from University Sains Malaysia. He is the Chairman of the Special Board Committee and a member of the Audit and Examination Committee of the Board. Dato Hairuddin was formerly the Commissioner of Police at the Commercial Crimes Investigation Department. During his 36 years of tenure, he held several senior positions in the Force, amongst which were Deputy Commissioner of Police (Chief, Police Officer of Kedah), Senior Assistant Commissioner I [(Deputy Director of Administration (Training)], and Senior Assistant Commissioner II (Crime Investigation Department, Sarawak). Dato Hairuddin has wide experience in fraud detection and commercial crime investigation. He does not have any family relationship with any Director and/or major shareholder of BHB nor does he have any conflict of interest with BHB. He has not been convicted of any offence within the past ten (10) years. He attended all the six (6) Board Meetings held in the financial year. 10 Annual Report 2009

13 CEOs in the Group Encik Johan bin Abdullah Group Managing Director / Chief Executive Officer BIMB Holdings Berhad Dato Zukri bin Samat Managing Director Bank Islam Malaysia Berhad Dato Mohamed Hassan bin Md. Kamil Group Managing Director Syarikat Takaful Malaysia Berhad Dato Idris bin Md Tahir Chief Executive Officer / Executive Director (Operations) BIMB Securities Sdn. Bhd. Annual Report

14 Seated (from left to right) Dato Mohd Bakke bin Salleh Tan Sri Samsudin bin Osman (Chairman) Encik Johan bin Abdullah (Group Managing Director / Chief Executive Officer) Standing (from left to right) Dato Dr. Abdul Halim bin Ismail Datuk Ismee bin Ismail Puan Zaiton binti Mohd Hassan Dato Hairuddin bin Mohamed Encik Mohd Zin bin Idris Encik Salih Amaran bin Jamiaan 12 Annual Report 2009

15 Letter to Shareholders h Dear Shareholders, h The Board of Directors of BIMB Holdings Berhad ( BHB or the Group ) is pleased to report that t BHB turned in a satisfactory t performance even as we weathered the challenges of a difficult operating environment during the year under review. We are pleased to present the Annual Report and Financial i Statements t t of BHB and the Group for the financial year ended d 30 June 2009 ( FY2009 ). Financial Performance Despite adverse market conditions underpinned by the overall slowdown in global economy, the Group s revenue grew by 4.44% to RM1.49 billion in FY2009 over the preceding year s revenue of RM1.43 billion. The bulk of this revenue comprised income derived from the Group s investment of depositors funds and shareholders funds of RM1.02 billion and RM0.47 billion respectively. However, lower recoveries on financing led to a net allowance for losses in financing position amounting to RM million in FY2009 compared to a net recovery in financing position of RM7.55 million in FY2008. This in turn weighed down on the Group s profit before zakat and tax ( PBZT ) for the year, which resulted in a 21.20% decline in our PBZT to RM million (FY2008: RM million). On the whole, higher fund based activities and stable fee and commission income from our Banking operations helped to balance out a 12.90% decline in profit from General Takaful and Family Takaful funds from our Takaful segment. The year saw shareholders funds rising 26.58% to RM1.27 billion, while total assets expanded by 15.65% to RM31.90 billion. The Group s net tangible assets per share grew 5.31% to 119 sen (FY2008: 113 sen), while we posted return on assets of 1.01% and return on equity of 9.98% respectively. On the banking front, the Group remains well-capitalised with a core capital ratio of 12.25% and a risk-weighted capital ratio ( RWCR ) of 13.87%. Islamic Banking Bank Islam Malaysia Berhad ( Bank Islam or the Bank ) made strong strides forward in the year under review, achieving all performance targets and concluding all five pillars of its threeyear Turnaround Plan on schedule. The Banking Group s total income grew 8.38% to RM1.27 billion in FY2009 from RM1.18 billion the year before. Despite adverse market conditions, Bank Islam garnered a satisfactory PBZT of RM million, although some 25.58% lower than the record PBZT of RM million recorded in FY2008. The lower PBZT for FY2009 was mainly due to financing recovery from a large customer account in the preceding year. The Banking Group s financial performance was particularly encouraging as profit before allowances surged 20.80% to RM million on the back of net financing growth of 6.63% to RM9.66 billion and growth in deposits from customers of 21.44% to RM25.21 billion. The Banking Group s capitalisation and asset quality indicators remained strong in FY2009 with its RWCR at 13.87% (FY2008: 13.15%) and core capital ratio at 12.25% (FY2008: 11.27%). In April 2009, Bank Islam had initiated a rights issue of Islamic Convertible Redeemable Non-Cumulative Preference Shares ( ICRNCPS ) to raise additional Tier-1 capital amounting to RM540 million ( Bank Islam Capital Raising ). Following the completion of the Bank Islam Capital Raising in October 2009, the Banking Group s RWCR is projected to strengthen further to 18.29%. The Banking Group s asset quality improved considerably as evidenced by the continuous decline in its net non-performing financing ratio to 4.90% (FY2008: 7.82%) and a rise in its financing loss coverage ratio to 80.81% (FY2008: 75.84%). Return on equity and return on assets (based on PBZT) declined to 16.55% (FY2008: 27.11%) and 0.92% (FY2008: 1.50%) respectively, while its cost-to-income ratio dropped slightly to 56.86% (FY2008: 59.58%) notwithstanding the continued investments in branch remodelling, network expansion, as well as its IT infrastructure and human capital development. Annual Report

16 LETTER TO SHAREHOLDERS All the Banking Group s business divisions performed well in FY2009. Its Consumer Banking division remained the largest contributor, representing 66.39% of the Bank s total gross financing portfolio. The Bank s non-fund based income also registered a significant jump by 30.60% to RM million with contributions coming mainly from the Corporate Investment Banking, Treasury and Consumer Banking divisions. Key Developments Several key developments took place in FY2009 that helped ensure Bank Islam remained as a dynamic and competitive entity. As a result of its aggressive corporate rebranding, branch remodelling and business transformation initiatives, as well as the introduction of innovative products and services, Bank Islam was conferred the prestigious Platinum Award for the Most Trusted Brand for Islamic Financial Services in the annual Reader s Digest Trusted Brands Award The Bank added seven new branches in strategic locations throughout the states of Selangor, Pahang and Sabah bringing its total branch network to 97 branches. The total number of branches is expected to cross the 100 mark by the end of To sustain the momentum of its branch rationalisation exercise and to enhance its delivery outreach and standards, existing branches were relocated to more strategic business growth areas, while 15 branches were remodelled. On top of this, the Bank continued to promote its alternative delivery channels. To broaden its foreign currency retail services capability, Bank Islam introduced two Bureau de Change outlets one within the Low Cost Carrier Terminal at the Kuala Lumpur International Airport, and another in Karamunsing, Sabah. To drive business growth, several innovative products and services were introduced. These included the An Najah NID-I, a healthcare-based capital protected structured investment product and the Al-Awfar, Islamic banking s first-of-its-kind savings-i and investment-i account which rewards customers with cash prizes. To strengthen its human capital, Bank Islam has developed a structured leadership and succession planning programme. Enhancements to its core banking system, risk management system and financial collection system will go a long way in enhancing the Bank s overall IT capability. Bank lslam is also collaborating with Lembaga Tabung Haji ( LTH ) to cross-sell its products and services to LTH s huge nationwide base of some five million prospects and its vast group of companies. The Bank s wholly owned subsidiary, Bank Islam Trust Company (Labuan) signed a memorandum of understanding with Bank Muamalat Indonesia to explore cooperation in trust and remittance services to the world s largest Islamic population. In FY2009, its wholly-owned subsidiary BIMB Investment Management Bhd, secured the Edge-Lipper Malaysia Fund Award for the Best Mixed Asset MYR Balanced Islamic Fund. Moving forward, Bank Islam will embark on its three-year Sustainable Growth Plan that will build upon the strong foundations laid under the Turnaround Plan. This new strategic blueprint incorporates six pillars to drive business growth i.e. business innovation; robust risk management; the strengthening of enabling infrastructure; capability and capacity building; franchise development; and inorganic growth and corporate expansion. Takaful & Retakaful Takaful Malaysia recorded a marginal decline in operating revenue of 2.48% to RM1.05 billion in FY2009. The decline was due to the lower contribution from the Family Takaful business in the absence of a product similar to its single contribution investment-linked product, Takaful myal-afdhal, which on its own generated RM90.2 million in FY2008. The General Takaful business, however, did grow by 31.12% (based on gross contribution) following a realignment of several non-profitable classes in FY2008 as well as Takaful Malaysia s enhanced distribution capability through its expanded corporate agent base. Amidst the uncertainties in the financial markets, Takaful Malaysia garnered investment income of RM million, higher than the preceding year s RM million. This result was all the more commendable given the lower returns from the equity portfolio in line with the lacklustre performance of the local equity market and the declining profit rate from fixed placements. Higher income from other asset classes helped cushion the lower results of the equity portfolio. The Islamic bonds portfolio recorded a significant increase in net income of 20.94% to RM84.69 million, while net income from government investment issues rose by 5.81% to RM19.11 million. As a result of Takaful Malaysia s proactive management approach, its overall equity portfolio outperformed the FBM Shariah Emas Index by 10.40%. Takaful Malaysia s PBZT increased to RM49.72 million against the preceding year s RM37.91 million. In tandem with the realignment strategy to move out of non-profitable classes, the General Takaful business performed favourably. Furthermore, measures taken to improve productivity and operational efficiency resulted in lower net claims incurred of RM28.18 million and turned the RM21.2 million bad debt expense incurred in FY2008 into a recovery of RM5.6 million in FY Annual Report 2009

17 LETTER TO SHAREHOLDERS Strategic Initiatives To maintain its edge amidst a highly competitive playing field, Takaful Malaysia made every effort to bolster its highly successful Mudharabah or profit-sharing model with several value-adding initiatives. As such, a three-pronged strategy was brought into play. The first strategy, the elevation of customer service levels, saw the company investing in IT solutions to better track and manage the customer experience. Improvements on the human capital front saw its front-liners being trained to be more responsive and knowledgeable. To better service the middle-upper target market who demand higher quality services, Takaful Malaysia introduced new standard operating procedures to provide a structured and disciplined approach to customer service. The second strategy, the development of a retail channel of distribution to replace the existing Takaful Family retail model saw the Wakalah model being introduced in late Involving the recruitment of retail agents or Takaful Financial Consultants, the Wakalah model is similar to a conventional agency structure. This move marks Takaful Malaysia s entry into the highly competitive agency-driven market where service levels and innovative products are essential for success. Finally, to expand and streamline its distribution network, Takaful Malaysia grew its number of corporate agents to over 1,000 and introduced the Takaful mydesk at selected Tabung Haji offices. With this enhanced distribution capability, Takaful Malaysia has been able to reduce the number of branches and streamline its operations thus leading to lower operating expenses and increased operational efficiency. Early 2009 saw the implementation of Premia, Takaful Malaysia s new core system that replaced its legacy system. With the enhanced IT infrastructure, the company is in a position to better serve its customers, operate more seamlessly and expand its agency network exponentially. On the human capital front, Takaful Malaysia now has a full team on board and all senior positions have been filled by experienced professionals. With Bank Negara Malaysia planning to issue two new Takaful licences, the outlook for Takaful products and services is bright although the playing field is expected to become more competitive. New players which will help keep the industry vibrant as they raise the bar on product and service innovations as well as compelling all players to work even harder. Stockbroking For the year under review the BIMSEC Group recorded a PBZT of RM0.42 million. This represents an 87.11% decrease from the previous year s PBZT of RM3.24 million. At company level, BIMB Securities Sdn. Bhd. ( BIMSEC ) also showed a decrease in PBZT from the previous year s RM3.58 million to RM0.79 million. This was attributable to the adverse global environment which affected the local equity market from the fourth quarter of 2008 onwards. Moving forward, our stockbroking arm will continue to enhance its retail and institutional businesses against the backdrop of current market sentiments. BIMBSEC is optimistic that its market share in terms of trading volume and value will improve as a result of aggressive marketing efforts and the strengthening of our dealing and research teams. Venture Capital The combined Loss Before Zakat & Tax ( LBZT ) of the Venture Capital arm of the Group, comprising BIMB Venture Capital Sdn Bhd ( BIMBVC ) and BIMB Musyarakah Satu Sdn Bhd ( BIMBMS ), for the year under review was RM2.71 million. (Note: BIMBMS turned in a LBZT for the year of RM2.73 million, whereas BIMBVC posted profit before tax of RM0.02 million). As part of efforts to rationalise the Group s business activities, the Group had made a conscious decision not to pursue further involvement in the venture capital industry. The strategy for our Venture Capital division going forward is to recoup the remaining investment held by BIMBMS. Currently, BIMBVC is undergoing the process of a members voluntary winding-up. In May 2009, Takaful Malaysia signed a joint venture agreement with PT Syarikat Takaful Indonesia and Koperasi Karyawan Takaful which set out the terms and conditions to govern their respective shareholdings in PT Asuransi Takaful Keluarga. This follows Takaful Malaysia s RM21.83 million capital injection into PT Asuransi Takaful Keluarga in the same month. Annual Report

18 LETTER TO SHAREHOLDERS Leasing (Ijarah) The property leasing arm of the Group, Syarikat Al-Ijarah Sdn. Bhd., posted a PBZT of RM17.12 million for the year under review, which is a decrease of 24.40% from last year s PBZT of RM19.50 million. This is due to the decrease in lease rental income in 2009 by 98.07% or RM28.32 million due to the redemption of assets leased to Bank Islam in July This, consequently gave rise to an exceptional gain on redemption of RM14.54 million, partly offsetting the decline in lease rental income. Corporate Governance Practices As part of our commitment to uphold the tenets of transparency, integrity and accountability, the Group continues to undertake strong corporate governance measures that aim to protect and enhance shareholder value. Stringent internal controls are deeply embedded within our corporate culture to ensure that transparent and accountable reporting are in place. The Group Enterprise Risk Management Framework which helps us to identify, evaluate, manage and monitor significant risks has been adopted by our major operating subsidiaries. Recognising that IT is key to supporting service efficiency and delivery systems as well as the implementation of a risk-based capital framework, our Banking subsidiary, Bank Islam, has developed an IT Risk Framework that has also been adopted by Bank Islam s subsidiaries. Corporate Responsibility Initiatives As an investment holding company operating in compliance with Shariah principles, the BHB Group is committed to undertaking responsible and sustainable corporate practices that enable us to balance our good bottom-line performance with respectable social and environmental performance. In the year under review, our subsidiaries continued to implement tangible corporate responsibility ( CR ) initiatives in the areas of the Community, Workplace, Marketplace and Environment. Details of the year s CR initiatives can be found in the CR section of this Annual Report. Economic Outlook In its October 2009 World Economic Outlook, the International Monetary Fund ( IMF ) reported that the global economy appears to be expanding once again, bolstered by the strong performance of Asian economies and stabilisation or modest recovery elsewhere. In the advanced economies, unprecedented government intervention has stabilised activity and has fostered a return to modest growth. Emerging and developing economies are generally further ahead on the road to recovery, led by a resurgence in Asia and helped by the recent rebound in commodity prices and supportive policies. Many countries in emerging Europe and the Commonwealth of Independent States have been hit particularly hard by the crisis, and developments in these economies are generally lagging behind those elsewhere. The pace of recovery is slow, and activity remains far below pre-crisis levels. The pickup is being led by a rebound in manufacturing and a turn in the inventory cycle, and there are some signs of gradually stabilising retail sales, returning consumer confidence, and firmer housing markets. As prospects have improved, commodity prices have staged a comeback from lows reached earlier this year, and world trade is beginning to pick up. Thus, after contracting by about 1% in 2009, global activity is forecast to expand by about 3% in 2010 still well below the rates achieved before the crisis. Going forward, the IMF is projecting global growth of about 3.1% in For the ASEAN economies, the outlook is more mixed. In the more export-oriented economies such as Malaysia and Thailand, activity will increase gradually during the second half of 2009, with stronger growth projected in In Malaysia, consumer and business confidence has started to improve, possibly influenced by the Government s fiscal stimulus packages, historically low interest rates and recent liberalisation measures to support the Malaysian economy. The IMF projects that Malaysia s real GDP will contract to 3.6% in 2009 and will recover to reach 2.5% in Market Outlook On the Malaysian banking front, Islamic banking assets at the end of 2Q 2009 comprised about 19% of total banking assets, with total financing amounting to RM118 billion representing approximately 20.1% of the banking industry s total financing portfolio. Net non-performing financing for Malaysia Islamic banks remained low at 2.4%. Islamic debt securities also continued to maintain their dominance in the Malaysian bond market, accounting for about 58% of the total bond market with almost two thirds of the equity market comprising Shariah compliant securities. The Takaful sector also experienced a growth with funds asset registering an increase of more than 8%. 16 Annual Report 2009

19 LETTER TO SHAREHOLDERS The burgeoning Islamic finance segment continues to grow. The last 10 years have seen an increase in Islamic financial institutions that include full-fledged Islamic banks and financial development institutions that engage in Islamic banking, takaful, re-takaful and capital market activities. Several of these players continue to form strategic partnerships with foreign players. Following the announcement of liberalisation initiatives in April 2009, new mega Islamic banking licenses and up to two family takaful licenses are expected to be issued this year. On the global front, Islamic financial assets are projected to grow to USD1.6 trillion by 2012 while outstanding global sukuk to date is valued at approximately USD152.8 billion. All these developments underscore the fact that Islamic finance will remain a growing industry with many markets and potential new sources of funds to tap. Prospects While the Group has successfully weathered the challenges of FY2009, going forward we remain cautiously optimistic about FY2010 s outlook. Despite the positive signs of economic recovery and the many opportunities in the burgeoning Islamic financial landscape, we will continue to adopt a prudent approach to the management of the asset quality of our banking, takaful and stockbroking business segments. BHB will continue to implement measures to reduce operating overheads and to enhance operational efficiencies while exploring strategic collaboration with the right business partners. To support our business objectives, we will continue to leverage on technology, make improvements to our systems and processes, mitigate risk through a strong corporate governance and risk management framework as well as improve the quality of our human capital. Our banking subsidiary, Bank Islam, will continue to exercise prudence in its financing activities with an emphasis on the credit quality of its consumer, commercial and corporate clientele. At the same time, it will focus on recession-proof economic sectors, non-fund based income and deposits growth. As it embarks on its new three-year Sustainable Growth Plan ( ), the Bank will also continue to invest in capacity and capability building as well as enhance its IT infrastructure and branch network. As it gears for growth in the new financial year, Takaful Malaysia will remain prudent in its investments and continue to rationalise and right-size its branch network while leveraging on the Group s infrastructure to market its products and services. Even as Takaful Malaysia works to tighten up its underwriting standards and dispense with unprofitable businesses in its portfolio, we are confident going forward, it will find itself in a position of strength. BHB, as a Group, and its subsidiaries will work hard to face the challenges of the marketplace and capitalise on the many opportunities before us while undertaking the necessary measures to protect stakeholders interests. Going forward, we envisage that the Group will perform satisfactorily in FY2010. Acknowledgements The Board of Directors wishes to convey our sincere appreciation to our shareholders, customers and business associates for your unwavering support of BHB and confidence in the Group. Our gratitude to the Government and regulators, in particular Bank Negara Malaysia, the Securities Commission and Bursa Malaysia Securities Berhad, for their steadfast guidance and support. To the loyal and hard working management team and staff at BHB Group, please accept our heartfelt appreciation for your perseverance and fine work that continues to propel us forward on our journey to success. The Board would also like to assure our valued Shareholders that we will continue to work hard to leverage on our expertise and insights to further strengthen and secure the future growth of the Group. We trust that all our stakeholders too will continue to give us their continuous support as we endeavour to strengthen and grow BHB. Thank you and Wassalam. Tan Sri Samsudin Osman Chairman Annual Report

20 Operational Highlights On the Banking front, Bank Islam Malaysia Berhad ( Bank Islam or the Bank ) successfully achieved all performance targets and brought its three-year Turnaround Plan to a neat conclusion. We are pleased to report that Bank Islam is today a rejuvenated and adequately capitalised banking entity that is back on the pathway to growth. The Bank s transformation into a reputable and trusted brand name comes on the back of a strengthened foundation characterised by excellent service delivery and increased accessibility to its products and services; continuous product innovation; plus a consistent and sustainable profitability track. Islamic Banking 18 Annual Report 2009

21 OPERATIONAL HIGHLIGHTS On top of this, the Bank s implementation of dynamic and proactive risk management systems and mechanisms; strong corporate governance; prudent balance sheet expansion and asset-liability management; as well as its favourable credit profile, quality asset mix and manageable non-performing financings, have enabled it to make strong strides forward. With the right people, positioning and all the elements for performance in place, the Board is confident that Bank Islam will deliver on its promises as it embarks on a new three-year Sustainable Growth Plan. Annual Report

22 OPERATIONAL HIGHLIGHTS Takaful & Retakaful Our Takaful & Retakaful subsidiary, turned in a satisfactory performance and committed to business growth via a three-pronged strategy, namely, improving the customer experience, developing a new full-fledged agency retail channel and expanding its overall distribution channels. To track and manage the customer experience, Takaful Malaysia strengthened its information technology ( IT ), human resources and introduced new standard operating procedures. Via the introduction of the new Wakalah agency retail channel model in late 2008, Takaful Malaysia now has the capability to compete in the highly competitive agency-driven market. To expand its distribution network, the company grew the number of its corporate agents to over 1,000 and introduced the Takaful mydesk at selected Lembaga Tabung Haji offices. This has enabled Takaful Malaysia to streamline its operations through a reduction in the number of branches while increasing operational efficiencies. 20 Annual Report 2009

23 OPERATIONAL HIGHLIGHTS In line with its regional expansion plans, Takaful Malaysia further strengthened the capital structure of its Indonesian operations through signing a joint venture agreement with PT Syarikat Takaful Indonesia and Koperasi Karyawan Takaful in relation to their respective shareholdings in PT Asuransi Takaful Keluarga. The elements are in place for Takaful Malaysia to propel forward in the coming years. Annual Report

24 OPERATIONAL HIGHLIGHTS Others Stockbroking Our stockbroking arm turned in a positive performance despite the weaker local equity market. Amidst prevailing market sentiments, the BIMSEC Group is working to strengthen its retail and institutional businesses through aggressive marketing efforts and growing its dealing and research teams. The BIMSEC Group is confident of making good progress in terms of trading volume and value in the new financial year 22 Annual Report 2009

25 OPERATIONAL HIGHLIGHTS Leasing (Ijarah) Syarikat Al-Ijarah Sdn Bhd posted a PBZT of RM17.12 million for the year under review, some 24.40% lower than the preceding year s PBZT due to a decrease in lease rental income. Venture Capital The venture capital arm of the Group recorded a combined LBZT of RM2.71 million. In an effort to consolidate the Group s core business as well as to rationalise and enhance group synergy, the Group has made a conscious decision to exit the venture capital business. Annual Report

26 5-years Group Financial Highlights 2005 RM RM RM 000 Restated 2008 RM RM 000 Share Capital 562, , , ,390 1,066,790 Shareholders Funds 1,086,537 (145,890) 921,118 1,005,284 1,272,533 Deposits from Customers 13,238,227 14,148,593 17,388,633 20,535,907 24,871,451 Takaful Funds 2,172,424 2,445,551 2,635,212 3,197,799 3,452,341 Financing of Customers 9,096,791 8,601,387 8,403,285 9,055,028 9,661,864 Investments 4,742,913 2,622,481 4,002,831 3,734,094 9,092,943 Total Assets 18,507,972 17,742,000 22,551,201 27,582,097 31,898,208 Revenue 1,087,432 1,115,953 1,858,669 1,426,814 1,490,180 Profit/(Loss) before Zakat and Taxation (400,489) (1,177,939) 909, , ,132 Net Profit/(Loss) (456,851) (1,230,008) 787, , ,659 Dividend Less Taxation 10,133 13,193 9,694 9,601* Financing to Deposit Ratio (%) Net Non-Performing Financing (%) Earning/(Loss) per Share (sen) (81.15) (218.49) Net Tangible Assets per Share (RM) 1.93 (0.26) Gross Dividend per Share (%) * Net Dividend per Share (%) * * Proposed dividend of 1.20% less 25% tax subject to shareholders approval at the forthcoming Annual General Meeting. 24 Annual Report 2009

27 5-YEARS GROUP FINANCIAL HIGHLIGHTS Shareholders Funds (RM Billion) Deposits from Customers (RM Billion) # # 2007 (0.15) Financing of Customers (RM Billion) Total Assets (RM Billion) # # Takaful Funds (RM Billion) Profit/(Loss) before Zakat and Taxation (RM Million) # # (1,177.94) (400.49) 2005 Earnings/(Loss) per Share (sen) Net Tangible Assets per Share (RM) # # 2007 (218.49) 2006 (0.26) 2006 (81.15) # Restated Annual Report

28 Corporate Responsibility As an investment holding company operating along Shariah principles, the BHB Group is committed to undertaking responsible and sustainable corporate practices that empower our various stakeholders, in particular the communities we operate in. As we focus on balancing our good bottomline performance with respectable social and environmental performance, we do so by honouring and promoting Islamic principles among customers of all faiths. For the year under review, our subsidiaries continued to implement impactful corporate responsibility ( CR ) initiatives in the areas of the Community, Workplace, Marketplace and Environment. Community Enrichment Efforts In line with the Group s commitment to elevate the well-being of communities, Bank Islam Malaysia Berhad ( the Bank ) partnered with Prokhas Sdn. Bhd. (wholly owned company of Minister of Finance, Incorporated) for Projek Amal Jariah, a project to repair the homes of the underprivileged and disabled. The Bank also collaborated with JAKIM to sponsor 13 episodes of a television programme to raise public awareness on the need to elevate the well-being of communities. Other community enrichment programmes saw the Bank supporting the underprivileged through gotong royong activities, the supply of basic necessities and financial assistance for rental payments. On top of this, Bank Islam sponsored the distribution of 5,000 copies of newspapers to participants and the community during the Ipoh Starwalk Takaful Malaysia s contributions came by way of its donations to underprivileged individuals and organisations including the Al Khaadem Home of Hope, Badan Kebajikan Siti Khadijah, PERNIM, Rumah Nur Hikmah and Lembaga Kebajikan Anak Yatim Sarawak, among several others. Takaful also extended RM25,000 to Rumah Anak Kesayanganku in Rawang for the purchase of ovens and other baking supplies for a bakery they had set up. This contribution will go a long way in helping the residents, mostly orphans, be independent and self-sustainable. As a government-linked company ( GLC ), BIMB Holdings Berhad is committed to the corporate responsibility ( CR ) objectives outlined in the Silver Book, which is a set of principles and guidelines to be implemented by GLCs so that they can proactively contribute to society and at the same time create value for their shareholders. In line with the Silver Book, we endeavour to contribute to society in the most efficient and effective manner in line with industry norms and best practices as well as the relevant regulatory framework. 26 Annual Report 2009

29 We shall continue to participate wholeheartedly in building a future for the younger generation through several educational initiatives. Bank Islam continues to help the needy by setting up welfare zakat funds for students in local universities, providing scholarships for overseas students, as well as building and upgrading religious schools. The Bank has adopted 13 schools nationwide for three years under the Government s Promoting Intelligence, Nurturing Talent and Advocating Responsibility ( PINTAR ) programme and is also funding English language workshops. To inculcate good financial planning habits among school children, the Bank participated in the School Adoption Programme with Bank Negara Malaysia to disseminate financial literature to primary and secondary schools as well as distribute Braille versions to the visually impaired. Bank Islam also sponsored various initiatives to promote innovation and creativity at universities as well as collaborated with the New Straits Times Press to sponsor competitions in its Niexter news supplement targeting youth. Annual Report

30 CORPORATE RESPONSIBILITY January 2009 saw Takaful Malaysia launching its umbrella CR programme called Takaful myjalinan. Three subbrands were introduced under the umbrella brand, each dedicated to supporting a particular underprivileged group in the community. The myjalinankasih programme aims to provide assistance, both financial and in kind, to single mothers, orphans, disabled and the hardcore poor. The Al Khaadem Home of Hope in Shah Alam was the first beneficiary under this programme. The myjalinanilmu programme focuses on assisting students who come from hardcore poor backgrounds. Sekolah Kebangsaan Permatang Binjai in Penang was the first beneficiary of this initiative as were several hardcore poor students. Takaful s myjalinanalam serves as Takaful Malaysia s environmental prong and to kick start its environmental conservation efforts, Takaful launched an Adopt-a-Tree programme. Currently, the BHB Group is one of the 20 GLCs ( G-20 ) involved in the pilot project of the recently launched Sejahtera programme, a povertyalleviation scheme under the auspices of The Putrajaya Committee on GLC High Performance ( PCG ). The PCG s Sejahtera programme is designed to empower and improve the livelihood of the country s vulnerable groups (including the hardcore poor, single mothers and the elderly) by providing them the skills that will help them yield a more sustainable income. We also continue to be involved in the PINTAR programme, which has now been elevated to the national level and incorporates a new integrated approach. Workplace Best Practices As part of Bank Islam s continued efforts to inspire and provide conducive working environment for its over 3,000 employees, the Bank continues to undertake numerous workplace initiatives. These include induction training to educate new employees on the fundamentals of working for the Islamic banking industry, flexible working hours (during the month of Ramdhan), the availability of examination leave for employees pursuing further studies and priority for internal job applicants. The Bank also provides incentives for children of employees with excellent examination results, has made a sundry fund available to employees requiring financial assistance, and offers staff daily religious lectures delivered by notable in-house and invited speakers. On top of this, stringent occupational health and safety measures continue to be implemented for employee safety and health. Marketplace Initiatives BHB Group continue to carry our marketplace activities that impact tangibly upon our stakeholders. To promote public awareness and knowledge sharing, our subsidiaries continue to participate in numerous local and regional exhibitions and seminars designed to promote Islamic banking and finance. As part of our efforts to increase the depth and breadth of the industry and fast track its growth, we play host to local and international delegations interested to learn from Bank Islam s experience. To help raise public awareness of Islamic banking and the benefits of its products and services, we sponsor forums. To grow a pool of credible Islamic banking talent within the industry, Bank Islam is taking the lead through various initiatives. These include collaborating with Dewan Amal Islam Hadhari ( DAMAI ) and the Islamic Banking and Finance Institute Malaysia ( IBFIM ) to provide training to graduates in Islamic studies; assisting the International Centre for Education in Islamic Finance ( INCEIF ) to develop the syllabus and content for various Islamic banking courses; and initiating a bilateral knowledge and expertise exchange with the European Islamic Investment Bank Plc. based in London in the form of short-term professional attachments. Environmental Conservation Efforts BHB and its subsidiaries recognise the role we can all play in helping sustain and improve the environment and we are exploring opportunities to make a more tangible impact in this area. For a start, Bank Islam participated in the 28 Annual Report 2009

31 WWF s Earth Hour Campaign to create awareness and support the global cause of preserving energy. The Bank also initiated a Jom Save Cost Campaign, a series of internal campaigns that remind employees to be more prudent during these difficult times. The campaign includes advocating calculated actions in saving trees as well as conserving the use of the natural resources such as energy and water. Going forward, BHB and its subsidiaries remain committed to inculcating good CR practices within our work culture and business practices. Our long-term goal will be to implement tangible CR initiatives that deliver positive outcomes and enable us to forge enduring relationships with our key stakeholders including our shareholders, employees, business partners and regulators. Annual Report

32 2008/2009 Highlights 3 December 2008 Syarikat Takaful Malaysia Berhad ( Takaful Malaysia ), unveiled its first series of Wakalah based products namely Takaful mymedicare, mysiswa, myimpian and mysinar. This new and improved range of Life (Family) and Medical Products were launched by Takaful Malaysia s Chairman YBhg. Tan Sri Dr. Hadenan Abdul Jalil on 3 December December December 2008 The 11th Annual General Meeting of BHB held on 17 December 2008 provides a platform for dialogue for the shareholders with regard to issues pertaining to both financial performance and corporate matters of the BHB Group. 17 December February 2009 A Memorandum of Understanding paved the way for the exclusive partnership between Bank Islam Trust Company (Labuan) Ltd. and Bank Muamalat Indonesia Group to co-operate in the promotion of Islamic trust products to the world s largest Islamic population. 25 March 2009 Bank Islam launched the first-of-its-kind product, Al-Awfar Savings Account-i & Investment Account that offers a unique proposition of allowing the Bank to reward deserving account holders with cash prizes of up to RM100, February March 2009 Bank Islam held a Managers Conference in 2009 to ensure all managers are kept abreast with the Bank s Strategy for the Financial Year 2008/ March Annual Report March 2009

33 20 April April 2009 Prime Minister Yang Amat Berhormat Dato Sri Mohd Najib Bin Tun Haji Abdul Razak launched Takaful Malaysia s new Investment-linked Product Takaful myinvest at the Minggu Saham Amanah Malaysia 2009 (MSAM 2009) in Johor Bahru on 20 April In line with Takaful Malaysia s aim to increase its product portfolio, this open-ended all in one product is designed to meet the needs of investors who wish to diversify their investment portfolios while obtaining ideal Takaful protection. 16 June June 2009 BHB held an Extraordinary General Meeting on 16 June 2009 to obtain its shareholders approval to undertake a restricted issue of 175,400,000 new ordinary shares of RM1.00 each to LTH to enable BHB to participate in a capital raising exercise undertaken by Bank Islam. 22 June June 2009 Takaful Malaysia unveiled Takaful Malaysia Business Desk or Takaful mydesk at the Lembaga Tabung Haji. The launch was held in conjunction with the signing of a strategic Co-operation Agreement between the parties. Takaful Malaysia views this smart partnership as a strong platform for various business opportunities, including cross selling of insurance products with investments and savings. 8 July July 2008 Takaful Malaysia signed a Distribution Agreement with Standard Financial Planner Sdn. Bhd. (SFP). Takaful Malaysia appointed them to market Takaful Malaysia products through SFP s nationwide network of more than 300 representatives of which 75 are licensed Financial Advisors with Bank Negara Malaysia. This will enhance the penetration of Takaful Malaysia s Family and General Products into the middle-upper Malaysian market - making Takaful Malaysia s products more accessible to a wider customer-base. 4 August 2009 Bank Islam s Managing Director, Dato Zukri Samat presented the Bank s business zakat worth RM 1.7 million to Y.B. Senator Dato Mejar Jeneral (B) Jamil Khir Bin Baharom to be contributed to the needy. 4 August 2009 Annual Report

34 Statement of Corporate Governance Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad The Code The Board of Directors of BIMB Holdings Berhad ( BHB or the Company ) recognises the importance of sound corporate governance standards and practices as a safeguard to protect and enhance stakeholders value and the performance of the Company. The governance framework adopted by BHB is based on the principles and best practices of the Malaysian Code on Corporate Governance (Revised 2007) ( the Code ). In addition to the Code, BHB is also guided by Bursa Malaysia Securities Berhad s ( Bursa Malaysia ) Listing Requirements and Bank Negara Malaysia s guidelines on Corporate Governance (BNM GP1-i). The Board is pleased to present the following report on the application of principles and best practices as set out in the Code. I. Board of Directors (1) The Board and Board Balance The Board comprises nine (9) members, with one (1) Executive Director and eight (8) Non-Executive Directors. Of the eight (8) Non-Executive Directors, four (4) are Independent Directors. The Independent Directors play a pivotal role in ensuring the required check and balance for making the Board independent, able and competent in discharging its duties and responsibilities. The Independent Directors also act as a safeguard in ensuring the interests of minority shareholders as well as stakeholders are protected. Brief backgrounds of each Director are presented on pages 8 to 10 of the Annual Report. The Group Managing Director/Chief Executive Officer ( GMD/CEO ) leads BHB s Management and is accountable to the Board and shareholders. The GMD/CEO is responsible for the day-to-day operations of BHB s business, strategic planning, budgeting, financial reporting and risk management. The duties and responsibilities of the Chairman and the GMD/CEO are distinct and separate. The Chairman leads and oversees the Board and presides at all Board meetings and shareholders meeting. The GMD/CEO leads BHB s Management and is responsible for the overall administration and operation of the Company. In addition the GMD/ CEO is also responsible for ensuring compliance with the regulations and requirements as underlined by the relevant regulatory bodies. In managing BHB s business affairs, the GMD/CEO is assisted by a Management Committee, which meets regularly from time to time. (2) Board Meetings Board meetings are scheduled in advance at the beginning of a new calendar year to enable Directors to plan ahead and fit the year s meeting into their own schedules. The Board meets on a scheduled basis at least four (4) times a year. When the need arises, Special Board meetings are also convened. Senior Management staff or external advisors may be invited to attend the Board meetings to advise the Board and to furnish the Directors with information and clarification needed on relevant item to enable them to arrive at a decision. 32 Annual Report 2009

35 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad During the year ended 30 June 2009, there were six (6) Board meetings held and Director s attendance at these meetings are as follows:- Directors Tan Sri Samsudin Osman Chairman/Non-Independent Non-Executive Director Johan Abdullah Group Managing Director/Chief Executive Officer Dato Dr. Abdul Halim Haji Ismail Non-Independent Non-Executive Director Dato Mohd Bakke Salleh Independent Non-Executive Director Datuk Ismee Ismail Non-Independent Non-Executive Director Mohd Zin Idris Independent Non-Executive Director Salih Amaran Jamiaan Non-Independent Non-Executive Director Zaiton Mohd Hassan Independent Non-Executive Director Dato Hairuddin Mohamed Independent Non-Executive Director No. of Meetings Held Attended (3) Supply of Information The Board of Directors have full and unrestricted access to all information pertaining to BHB s businesses and affairs to enable them to discharge their duties effectively. All the Directors have direct access to the advice and services of the Company Secretary and they may also seek independent professional advice where necessary. The Board meeting schedules are circulated in advance to Board members and the Board meeting papers are targeted for dissemination to the Directors at least five (5) days prior to the Board meeting to enable the Directors to obtain further clarification or explanation where necessary in order to be adequately apprised before the meeting. The deliberations and resolutions passed by the Board are properly recorded in the minutes and subsequently confirmed at the next Board meeting. The Board is also kept updated from time to time by the Company Secretary on new statutory and regulatory requirements or any changes or amendments to the Listing Requirements pertaining to their duties and responsibilities. Annual Report

36 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad (4) Appointment to the Board The appointment and re-appointment of Directors at BHB are under the purview of the Nomination and Assessment Committee ( NAC ). The NAC is entrusted with the specific tasks of identifying and making recommendations on the appointments of new Directors to the Board of the Company and its subsidiaries after taking into account the required mix of skills, experience and other qualities of the appointees. All appointments of Directors are subject to Bank Negara Malaysia s approval. (5) Re-election In accordance with the Company s Articles of Association, one third of the Directors shall retire from office at each Annual General Meeting ( AGM ) and are eligible to offer themselves for re-election. Directors, who are appointed by the Board in each financial year are subject to re-election by the shareholders at the next AGM following their appointments. Details of Directors due for re-election at the forthcoming AGM are disclosed on page 4 of the Annual Report. (6) Number of directorships In accordance with the Revised BNM GP1-I and Listing Requirements of Bursa Malaysia, Directors cannot hold more than ten (10) directorships in listed companies and not more than fifteen (15) directorships in non-listed companies. (7) Directors training Directors training is an ongoing process to enhance Directors knowledge on the latest development and key challenges in the financial sector. Directors are encouraged to attend training programmes as well as conference and seminars which are organized internally and by external parties. During the year, the BHB Board, the Directors of subsidiaries within BHB and Members of the Senior Management of BHB attended the following training programmes which were organised by BHB as well as other relevant bodies:- Course Title/Trainer Mandatory Accreditation Programme/Bursatra Sdn. Bhd. An Overview of IFRS Convergence and FRS139/KPMG Desa Megat & Co. The Non-Executive Directors Development Series: Is it Worth the Risk? /SIDC Finance for Directors and Executive Management/Marcus Evans All Directors have attended the Mandatory Accreditation Programme as required by Bursa Malaysia Listing Requirements. 34 Annual Report 2009

37 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad (8) Directors Remuneration The level of remuneration of the Directors is sufficient to attract and retain Directors with appropriate skills and experience to manage the Company effectively. The Board determines the remuneration of non-executive directors and executive director following the relevant recommendation made by the Remuneration Committee. The total remuneration of the Directors of the Company for the financial year ended 30 June 2009 are as follows:- The Group The Company RM 000 RM 000 Executive Director: Allowances 27 Salaries, bonuses, fees and EPF contributions Benefits-in-kind Non-Executive Directors: Fees and allowances 1, Total 2,210 1,159 Total (excluding benefits-in-kind) 2,167 1,116 The number of Directors of the Company, whose remuneration are paid/payable for their services, fall within the following bands: Group 2009 Number of Executive Director RM100,001 and RM150,000 RM750,001 and RM800,000 RM850,001 and RM900,000 1 Number of Non-Executive Directors Below RM50,000 1 RM50,001 and RM100,000 2 RM100,001 and RM150,000 2 RM150,001 and RM200,000 1 RM250,001 and RM300,000 1 RM400,001 and RM450,000 1 Total 9 Annual Report

38 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad II. Board Committee To assist the Board in discharging its duties, various Board Committees were established. The functions and terms of references of the Board Committees are clearly defined. a. Nomination and Assessment Committee ( NAC or Committee ) The NAC is responsible for assessing, considering and recommending to the Board, candidates for directorships to be filled in the Group. The other responsibilities of the Committee are as follow:- to recommend to the Board matters pertaining to the renewal or extension of Directors as well as the appointment and re-appointment of retiring Directors. to recommend to the Board, which Directors are to fill the seats on the Board Committee. to recommend to the Board matters concerning the appointment of Executive Directors as well as the appointment of candidates for senior management positions to be filled in the Group. to annually review and assess the performance of the Board as a whole, its various standing committees as well as the contributions of each individual Directors. The Company has conducted the annual assessment of the performance of the Board as a whole. The Company will continue to assess the appropriateness of the Board and its performance periodically to ensure its effectiveness and efficiency. The Committee comprises Non-Executive Directors, the majority of whom are independent. Meetings are held as and when necessary for the Committee to deliberate on related matters. The members of the Committee and their attendance are as follows:- No. of Meetings Members Held Attended Dato Mohd Bakke Salleh (Chairman) 1 1 Datuk Ismee Ismail 1 1 Mohd Zin Idris 1 1 Zaiton Mohd Hassan 1 1 b. Remuneration Committee ( RC or Committee ) The role of the RC is to assist and support the Board s responsibility in respect of the remuneration package of Directors of the Company in all forms. The Committee is also responsible for assessing and recommending to the Board:- the remuneration package of Executive Directors. the remuneration of Non-Executive Directors which shall be a decision of the Board as a whole, save and except where the remuneration is in respect of any member or members of this Committee. 36 Annual Report 2009

39 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad The Committee comprises Non-Executive Directors, the majority of whom are independent. Meetings are held as and when necessary for the Committee to deliberate on related matters. The members of the Committee and their attendance are as follows:- No. of Meetings Members Held Attended Dato Mohd Bakke Salleh (Chairman) 1 1 Datuk Ismee Ismail 1 0 Mohd Zin Idris 1 1 Zaiton Mohd Hassan 1 1 c. Audit and Examination Committee ( AEC or Committee ) The AEC comprises four (4) Non-Executive Directors (three (3) of whom, including the Chairman, are Independent Directors). In financial year 2009, a total of six (6) AEC meetings were held and the attendance of each member at AEC meetings are as follows:- No. of Meetings Members Held Attended Mohd Zin Idris (Chairman) 6 6 Zaiton Mohd Hassan 6 6 Salih Amaran Jamiaan 6 6 Dato Hairuddin Mohamed 6 6 Terms of Reference The terms of reference of the Committee are as follows: Composition The Committee shall comprise at least three (3) Non-Executive Directors, the majority of whom shall be Independent Non-Executive Directors. The Chairman shall be an Independent Non-Executive Director. At least one (1) member shall be a member of the Malaysian Institute of Accountants or possess similar qualifications as prescribed in Part I or Part II of the First Schedule of the Accountants Act 1967, with at least three (3) years of work experience. The Committee shall not consist of any alternate Director of the Company. Frequency of Meetings Meetings shall be held not less than four (4) times a year. The external auditors may request a meeting if they deem necessary. Annual Report

40 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad Quorum The quorum shall be three (3) with the majority being Independent Directors. The Company Secretary of BHB shall act as Secretary to the Committee. Attendance at Meetings The GMD/CEO is invited to attend the meetings. Other Board members shall also have the right to attend. At least twice a year, the Committee shall meet with the external auditors without the Executive Board Members present. Authority The Committee is empowered by the Board to carry out the following:- 1. Investigate any activity or matter within its terms of reference. 2. Promptly report to Bursa Malaysia matters which have not been resolved satisfactorily thus resulting in a breach of the Bursa Malaysia Listing Requirements. 3. Obtain external independent professional advice, legal or otherwise deemed necessary. 4. Maintain direct communication channels with external auditors, person(s) carrying out the internal audit function and Senior Management of the Company and its subsidiaries. 5. Convene meetings with internal and external auditors, without the attendance of the Management, whenever deemed necessary. In discharging the above functions, the Committee is also empowered to have:- 1. The necessary resources which are required to discharge its duties. 2. Full and unrestricted access to information and documents relevant to its activities. Duties and Responsibilities The primary duties and responsibilities of the Committee are as follows:- 1. Internal Audit Review the adequacy of the internal audit programme and internal audit findings and recommend the actions to be taken by Management in regard to any deficiencies in controls and procedures that are identified. Recommend to the Board the appointment or termination of the Chief Internal Auditor. Assess the performance of the internal auditors; determine and recommend the remuneration and annual increment of the internal auditors. Take cognisance of resignations of internal audit staff members and provide the resigning staff member an opportunity to submit his or her reasons for resigning. 38 Annual Report 2009

41 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad 2. Internal Controls Review the effectiveness of internal controls and risk management processes. Review the Company s statement on internal control systems prior to endorsement by the Board of Directors. 3. External audit Review the external auditors audit scope and plan. Review the appointment of external auditors and the audit fee and any question of resignation or dismissal and to make recommendations to the Board. Monitor the effectiveness of the external auditors performance and their independence and objectivity. Review the external auditors letter to Management and Management s responses, including the previous audit recommendations and make recommendations to the Board. Approve the provision of a non-audit service by the external auditor. 4. Financial Reporting Review the quarterly and year-end financial statements of the Company before submission to the Board of Directors, focusing particularly on:- Any changes in accounting policies and practice. Significant adjustments resulting from the audit. The going concern assumption. Compliance with applicable Financial Reporting Standards and other legal and regulatory requirements. 5. Related Party Transactions Review and report to the Board any related party transactions that may arise within the Company or Group. 6. Annual Report Report the Audit Committee s activities, the number of audit meetings held in a year, details of attendance of each director in respect of the meetings and the details of relevant training attended by each director. 7. General To perform any other functions as may be agreed by the Board. Annual Report

42 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad Internal Audit Function The internal audit function is carried out by the Internal Audit Department of Bank Islam Malaysia Berhad ( Bank Islam ) a subsidiary of BHB to whom the function has been outsourced since December The internal audit function for BHB s core subsidiaries (Banking and Takaful businesses) was carried out by the internal audit departments of BHB s banking and takaful subsidiary. The respective internal auditor regularly audit the internal control practices and report significant findings to the respective Audit Committee with proposed recommendations. The respective internal auditor s core function is to perform an independent appraisal of the Bank Islam Group and Syarikat Takaful Malaysia Berhad ( Takaful Malaysia ) Group activities, to provide assurance on compliance to internal controls and risk management processes, and compliance with laws, regulations and policies. The Management of Bank Islam and Takaful Malaysia are responsible for ensuring that corrective actions on reported weaknesses are undertaken within an appropriate time frame. Activities During the Year The following is a summary of the activities that were carried out by the Committee during the financial year:- a) Review of the Group s quarterly, half-yearly and annual financial statements prior to the submission to the Board for consideration and approval; b) Review and approval of the external auditors scope of work and audit plan for the year; c) Review of the audit report for the Company prepared by the external auditors and internal audit department, their findings and Management responses thereto; and d) Review of the recurrent related parties transactions. d. Special Board Committee ( Committee ) The Committee was established to consider, and if appropriate, inquire into, evaluate, advise and make recommendation to BHB s Board on actions to be taken against any officer, adviser or consultants of companies within the BHB Group where there are sufficient grounds to believe that such an officer, adviser or consultant behaved in such manner detrimental to the interests of such entities. The other responsibilities of the Committee are as follows:- To consult solicitors or the relevant officers of the companies within the BHB Group in relation to any reports, findings, observations and recommendations on the conduct of officers, advisers or consultants in relation to the issue determined by BHB s Board; To engage an independent legal advisor, where necessary to provide independent legal advice on any contentious issues that are viewed to be complex in nature; To request for explainations or clarification by such relevant officers in relation to the handling, management, decisions, actions or omission relating to the issue; and To establish a sub-committee (s) comprising such officers of companies within the BHB Group to assist it in carrying out its function including carrying out further investigation to establish certain facts or to collate further information. 40 Annual Report 2009

43 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad Meetings are held as and when necessary. During the financial year, there was no meeting held. The members of the Committee are as follows:- Members Positions Dato Hairuddin Mohamed (Chairman) Director, BHB Mohd Zin Idris Director, BHB Dato Zukri Samat Managing Director, Bank Islam e. Other Group Committee Shariah Committees There are three (3) Shariah Committees catering for major operating BHB s subsidiaries (Banking, Takaful and Stockbroking) businesses. In compliance with BNM s Guidelines on the Governance of the Shariah Committee for Islamic Financial Institutions (BNM/GPSi), and Memorandum and Articles of Association, the Shariah Committees ensure that the operations of the Banking, Takaful and Stockbroking subsidiaries are Shariah compliant. i) Shariah Supervisory Council of Bank Islam Members Dr. Ahmad Sobri Salamon (Chairman) Ustaz Mohd Bakir Haji Mansor Y.A.A. Dato Haji Daud Muhammad Prof. Madya Dr. Yusof Ramli Nationality Malaysian Malaysian Malaysian Malaysian ii) Shariah Advisory Body of STMB Members Ustaz Mohd Bakir Haji Mansor (Chairman) Datuk Abdul Hamid Said Dr. Ahmad Sobri Salamon Dr. Aida Othman Nationality Malaysian Malaysian Malaysian Malaysian iii) Shariah Committee of BIMB Securities Sdn. Bhd. Members Ustaz Mohd Bakir Haji Mansor (Chairman) Prof. Dato Paduka Dr. Mahmood Zuhdi Hj. A. Majid Dato Dr. Abdul Halim Ismail Nationality Malaysian Malaysian Malaysian Annual Report

44 STATEMENT OF CORPORATE GOVERNANCE Pursuant to Paragraph of the Listing Requirements of Bursa Malaysia Securities Berhad III) Accountibility and Audit Financial Reporting The Board takes responsibility for presenting a balanced and comprehensive assessment of the Company s and Group s operations and their prospects at the end of each financial year primarily through annual financial statements, quarterly and half-yearly announcement of results to shareholders as well as the Letter to Shareholders in the annual report. The financial statements of BHB are prepared in accordance with the Malaysian Accounting Standards Board s requirements to ensure that the reports present a true and fair view of Group performance. The Statements by Directors pursuant to Section 169 of the Companies Act are set out on page 116 of the Annual Report. Internal Control The Board recognizes the importance of a sound system of internal control to safeguard shareholders investments and the Company s assets. The Statement of Internal Control which provides an overview of the state of the Internal Control is set out on page 43 to 44 of the Annual Report. Relationship with Auditors The Board has established a transparent and appropriate relationship with its auditors through the AEC. The external auditors have an obligation to bring any significant defects in the Group s system of internal control and compliance to the attention of Management, AEC and the Board. The role of the Audit Committee in relation to the external auditors is described under the AEC Report on page 39 of this Annual Report. IV) Shareholders The Board recognises the importance of timely and equal dissemination of information with regard to the Company s and the Group s performance and other matters affecting shareholders interest to shareholders, investors and the general public. One of most important channels of communication to shareholders is through the annual report which contains comprehensive and sufficient details about the financial results and performance of the Company and the Group. The Annual General Meeting is regarded as the principal forum during which shareholders and investors are informed of the current developments of the Company and the Group. Shareholders are invited to ask questions during the question and answer session prior to the motion moving for approval of a particular resolution. In addition, the Company from time to time makes various announcements and disclosures on material corporate proposals to Bursa Malaysia (including mandatory disclosures under the Listing Requirements) so that the investing public has reasonable access to material information affecting the Group. The Company s major subsidiaries, Bank Islam and Syarikat Takaful Malaysia Berhad (listed on the Main Market) also make disclosures to the media from time to time on various matters pertaining to their activities that are of public interest. 42 Annual Report 2009

45 Statement on Internal Control The Board of Directors ( Board ) of BIMB Holdings Berhad ( BHB ) recognises the importance of maintaining a sound system of internal control and risk management practices to ensure good corporate governance. The Board affirms its responsibilities for reviewing the adequacy and integrity of the Group s system of internal control, including the review of its effectiveness. As with any other internal control system, the Group s system of internal control is designed to manage and appropriately mitigate the risk of failure in achieving business objectives. As such, the system can only provide reasonable assurance against material misstatement or loss. The process of identifying, evaluating and managing the significant risks faced by the Group is an on-going process and includes reviewing and updating the internal controls system when there are changes to business environment, operations or regulatory guidelines. The Audit and Examination Committees and Boards of the Banking and Takaful subsidiaries are responsible for their respective statements on internal control. Key Internal Control Processes Risk Management The Board recognizes that risk management is an integral part of the Group s day-to-day operations. The assessment and management of risks will affect the achievement of BHB s business objectives as well as protecting shareholders and stakeholders value. The Board of BHB had on 26 May 2008 endorsed the Enterprise Risk Management Framework where it includes amongst others quarterly presentation of the risk management dashboard by the respective operating subsidiaries, which covers credit, market, underwriting, liquidity and operational risks. The primary responsibility of managing risks remains with the Risk Management Division, Risk Management Committee and Board of the respective subsidiaries. The major operating subsidiaries, namely Bank Islam Malaysia Berhad and Syarikat Takaful Malaysia Berhad have established and adopted their own Risk Management Framework to manage their respective business and operational risks. Audit and Examination Committee The Audit and Examination Committees of BHB and its major subsidiaries review internal control issues identified by the respective internal auditors, external auditors, regulatory authorities and the management themselves, and deliberate on the actions taken/to be taken, and where necessary, recommend further actions to address the internal control issues. Where there are specific issues brought to the attention of the BHB s Audit and Examination Committee, the management of the subsidiaries shall be invited to explain and discuss the findings and corrective action plan to be taken. The primary responsibility of managing internal control matters remains with the Internal Audit Division, Audit and Examination Committee and the Board of the respective operating subsidiaries. As part of best practices, the Audit and Examination Committee holds meeting with External Auditors without the presence of the Executive Director and Management. Internal Audit The internal audit function for BHB and its wholly-owned subsidiaries is formally outsourced to the Internal Audit Division of Bank Islam. For the Banking and Takaful Groups, the internal audit functions are carried out by their own respective departments. The Internal Auditors reports directly to their respective Audit and Examination Committees. The Internal Auditors carry out regular reviews of the business processes to assess the effectiveness of internal control and report significant findings with proposed recommendations to the respective Audit and Examination Committees. Annual Report

46 STATEMENT ON INTERNAL CONTROL Other Key Elements of Internal Control Group Management Committee ( GMC ) GMC has been established at the BHB level to assist the Group Managing Director/Chief Executive Officer in ensuring the operations of the Group are conducted in accordance with corporate objectives. The GMC members consist of Managing Directors/Chief Executive Officers of the major operating subsidiaries who are principally responsible for the performance of their respective businesses. Standard Operating Procedures Documented Standard Operating Procedures ( SOP ) of all departments at BHB have been approved by the Management Committee and endorsed by the Audit and Examination Committee. The SOP serves as a day-to-day operational guide to ensure compliance with internal controls and the applicable laws and regulations. Human Resources Policies and Procedures The Human Resources SOPs are in place encompassing the full spectrum of human resources management such as the recruitment of new employees as well as performance appraisal and training. Budgeting Process The Group s annual budget is prepared based on the annual business plans from BHB s operating subsidiaries and subsequently tabled to the Board for approval. The major subsidiaries business plans and budgets are approved by their respective Boards. The subsidiaries performances are assessed against the budgets, and explanations are provided for significant variances on a regular basis to their respective Boards and BHB s Board. Information Technology ( IT ) System The subsidiaries within the Group recognize that IT is key to supporting service efficiency and delivery systems. In this regard, BHB s Banking and Takaful subsidiaries continue to upgrade their IT systems in order to enhance efficiency of their business operations and to facilitate the implementation of their risk-based capital frameworks. The IT Risk Framework was developed to ensure that risks are correctly identified and mitigated accordingly. Performance Review The Board receives and reviews reports from the Management on the financial performance as well legal and regulatory matters on a regular basis. Furthermore, a quarterly Financial Dashboard is presented by the respective Chief Executive Officers or Chief Financial Officers of the major subsidiaries within BHB Group, on profitability, capital adequacy, productivity and asset quality. The actual performance of BHB and its operating subsidiaries are assessed against approved budgets and industry averages, to identify and diagnose significant run-offs and gaps for corrective measures to be taken by management. Conclusion The Board is of the view that the system of internal controls instituted by BHB and its operating subsidiaries are sound and adequate to safeguard shareholders investments, customers interests and Group assets. 44 Annual Report 2009

47 Additional Compliance Information 1. Share Buybacks BHB did not purchase any of its own shares during the financial year ended 30 June Options, Warrants or Any Convertible Securities BHB has not issued any Options, Warrants or any convertible securities in respect of the financial year ended 30 June American Depository Receipt ( ADR ) or Global Depository Receipt ( GDR ) BHB has not sponsored any ADR or GDR programme in the financial year ended 30 June Non-Audit Fees The amount of non-audit fees paid/payable to external auditors and their affiliated companies by BHB for the financial year ended 30 June 2009 is set out in Note 30 on page 99 of this Annual Report. 5. Profit Guarantee There was no profit guarantees given by BHB during the financial year under review. 6. List of Properties The list of properties is set out on page 120 to 129 of the Annual Report. 7. Material Contracts Save as disclosed below, neither BHB nor its subsidiaries have entered into any contracts which are material, during the financial year ended 30 June 2009, other than contracts entered into in their ordinary course of business. (i) Joint Venture Agreement dated 18 May 2009 between Syarikat Takaful Malaysia Berhad, PT Syarikat Takaful Indonesia and Koperasi KaryawanTakaful setting out the terms and conditions that will govern their respective shareholdings in PT Asuransi Takaful Keluarga arising from the new shareholding structure of PT Asuransi Takaful Keluarga as a result of the capital injection by Syarikat Takaful Malaysia Berhad into PT Asuransi Takaful Keluarga amounting to RM21,825,000 on 5 May (ii) BHB had on 20 April 2009 entered into a Share Subscription Agreement with LTH, for LTH to subscribe for 175,400,000 new ordinary shares of RM1.00 each in BHB at the issue price of RM1.00 per share which is payable in cash. (iii) STMB had on 27 March 2009 entered into a conditional Sale and Purchase Agreement with Asian Finance Bank Berhad, as the financier for Export Import Bank of Malaysia Berhad ( EXIM ), to dispose all those seven (7) pieces of freehold lands held under Geran No. Hak milik 29799, Lot No. 1812, Geran No. Hak milik Lot No. 1813, Geran No Lot No. 1814, Geran No Lot No. 1815, Geran No Lot No. 1816, Geran No Lot No and Geran No Lot No all of Section 41, Town and District of Kuala Lumpur, State of Wilayah Persekutuan Kuala Lumpur together with one (1) unit of eighteen (18) storey office building erected in amalgam thereon and bearing its postal address as Darul Takaful, Jalan Sultan Ismail, Kuala Lumpur to EXIM for a total cash consideration of RM63,000, Imposition of Sanctions and/or Penalties Save as disclosed below, there were no other sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or Management arising from any significant breach of rules/guidelines/legislations by the relevant regulatory bodies during the financial year under review. i) Public Reprimand on Takaful Malaysia by Bursa Malaysia Securities Berhad ( Bursa Malaysia ) on 26 February 2009 for breach of Paragraphs 9.16(1)(a) and 9.19 (34) of the Listing Requirements of Bursa Malaysia. Annual Report

48 ADDITIONAL COMPLIANCE INFORMATION 9. Variation in Results There was no variation in results (differing by 10% or more) from any profit estimation forecast/projection unaudited results announced. 10. General Mandate BHB Group had, at the last AGM obtained a general mandate from its shareholders to allow BHB and/or its subsidiaries in their normal course of business, to enter into recurrent transactions of a revenue or trading nature with related parties which are necessary for its day to day operations, on terms not more favourable to the related party than those available to the general public and not to the detriment of the minority shareholders ( RRPTs ). The RRPTs Mandate is valid until the conclusion of the forthcoming AGM of the Company. The Board proposes to seek renewal of the RRPTs Mandate at the forthcoming AGM of the Company. This Mandate, if approved by shareholders, would be valid until the conclusion of the next AGM of the Company. 11. Recurrent Related Party Transactions Nature of Transactions** Related Party/ Principal Activities Interested Director and/ or Major Shareholder* Actual Transactions for the year ended 30 June 2009 RM 000 Brokerage fees payable to BHB Group. Rental of office premises payable from BIMB. Lembaga Tabung Haji ( LTH ) LTH is principally involved in providing pilgrimage management services, saving and depository services, investment holding and rental of buildings. LTH is a major shareholder of BHB with 51.47% shareholding. Tan Sri Samsudin bin Osman, being a nominee Director of LTH in BHB (has no direct/indirect shareholding in LTH and BHB). Datuk Ismee bin Ismail, being the Group Managing Director and Chief Executive Officer of LTH and also a Director of BHB (has no direct/indirect shareholding in LTH and BHB) ,587 Brokerage fees payable to BIMB Securities Sdn. Bhd. Permodalan Nasional Berhad ( PNB ) PNB is principally involved in investment holding and provision of management consultancy services. PNB, being a major shareholder of BHB with 5.81% shareholding. Dato Dr. Abdul Halim bin Ismail and Encik Salih Amaran bin Jamiaan, being the nominee Directors of PNB in BHB (both have no direct/indirect shareholding in PNB. Encik Salih has no direct/indirect shareholding in BHB) 19 Brokerage fees payable to BIMB Securities Sdn. Bhd. Amanah Saham Bumiputra ( ASB ) ASB is a fund scheme initiated under PNB. ASB is a major shareholder of BHB with 14.44%, registered under Amanah Raya Nominees (Tempatan) Sdn. Bhd. ASB is a wholly-owned subsidiary of PNB Annual Report 2009

49 ADDITIONAL COMPLIANCE INFORMATION Rental of office premises payable by BIMB. Leasing of office equipment payable to Syarikat Al-Ijarah Sdn. Bhd. ( SAISB ). Syarikat Takaful Malaysia Berhad ( Takaful Malaysia ) Takaful Malaysia is principally involved in family and general takaful business. Encik Johan bin Abdullah is a Director of BHB, BIMB and also a Director of Takaful Malaysia (has no direct/indirect shareholding in Takaful Malaysia and BHB). 7, Brokerage fees payable from BIMB, Takaful Malaysia, Al-Wakalah Nominees (Tempatan) Sdn. Bhd. and BIMB Musyarakah Satu Sdn. Bhd. Management fees payable from BIMBSEC Asset Management Sdn. Bhd. BIMB Securities Sdn. Bhd. ( BSSB ) BSSB is principally involved in the provision of stock broking and related activities based on the principles of Shariah. Dato Dr. Abdul Halim bin Ismail being Director of BHB and also an Executive Director of BSSB (has no direct/indirect shareholding in BSSB). Encik Johan bin Abdullah and Encik Mohd Zin bin Idris are Directors of BHB and they are also Directors of BSSB. They have no direct/ indirect shareholding in BSSB and BHB Rental of office premises payable from BIMB Investment Management Berhad (formerly known as BIMB Unit Trust Management Berhad) and BIMB Foreign Currency Clearing Agency Sdn. Bhd. Bank Islam Malaysia Berhad ( BIMB ) BIMB is principally involved in the provision of Islamic banking and related activities based on the principles of Shariah. Dato Mohd Bakke bin Salleh, Datuk Ismee bin Ismail, Puan Zaiton binti Mohd Hassan, Encik Mohd Zin bin Idris and Encik Johan bin Abdullah are Directors of BHB and they are also Directors of BIMB. They have no direct/indirect shareholding in BHB. 145 Rental of office premises payable to SAISB. *** 162 Profit from subordinated Mudharabah Financing payable to BHB. 2,755 * The direct and indirect shareholdings of the related parties in BHB above are set out in Section 6 of the Circular to Shareholders dated 30 October ** Nature of transactions existing transactions. *** Actual value inclusive of rental of motor vehicle of RM8,000. Annual Report

50 48 Annual Report 2009

51 Financial Statements Directors Report 50 Balance Sheets 54 Income Statements 55 Consolidated Statement of Changes in Equity 56 Statement of Changes in Equity 58 Cash Flow Statements 59 Notes to the Financial Statements 61 Statement by Directors 116 Statutory Declaration 117 Independent Auditors Report 118 Annual Report

52 Directors Report for the financial year ended 30 June 2009 The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 30 June Principal Activities The Company is principally engaged as an investment holding company with business transacted in accordance with Islamic principles, whilst the principal activities of the subsidiaries are as stated in Note 14 to the financial statements. There has been no significant change in the nature of these activities during the financial year. Results Group RM 000 Company RM 000 Profit for the year attributable to: Shareholders of the Company 113,659 13,111 Minority interest 94, ,708 13,111 Reserves and Provisions There were no material transfers to or from reserves and provisions during the year under review except as disclosed in the financial statements. Dividends Since the end of the previous financial year, the Company paid a first and final ordinary dividend of 1.45 sen per share less tax at 25% totalling RM9,693,865 (1.09 sen net per share) in respect of the financial year ended 30 June 2008 on 31 December The final ordinary dividend recommended by the Directors in respect of the year ended 30 June 2009 is 1.20 sen per ordinary share less tax at 25% totalling RM9,601,109 (0.90 sen net per ordinary share). Bad and Doubtful Financing Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps to ascertain that actions had been taken in relation to the writing off of bad financing and the making of provisions for doubtful financing, and have satisfied themselves that all known bad financing have been written off and adequate provisions had been made for bad and doubtful financing. At the date of this report, the Directors are not aware of any circumstances that would render the amount written off for bad financing, or amount of the provision for doubtful financing in the financial statements of the Group and of the Company, inadequate to any substantial extent. 50 Annual Report 2009

53 DIRECTORS S REPORT for the financial year ended 30 June 2009 Current Assets Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps to ascertain that any current assets, other than financing, which were unlikely to be realised in the ordinary course of business at their values as shown in the accounting records of the Group and of the Company have been written down to their estimated realisable value. At the date of this report, the Directors are not aware of any circumstances that would render the values attributed to the current assets in the financial statements of the Group and of the Company to be misleading. Valuation Methods At the date of this report, the Directors are not aware of any circumstances which have arisen which render adherence to the existing methods of valuation of assets or liabilities of the Group and of the Company to be misleading or inappropriate. Contingent and Other Liabilities At the date of this report, there does not exist: (a) any charge on the assets of the Group and of the Company which has arisen since the end of the financial year and which secures the liabilities of any other person, or (b) any contingent liabilities in respect of the Group and of the Company that has arisen since the end of the financial year other than those incurred in the ordinary course of the banking business. No contingent or other liability of any company in the Group has become enforceable, or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the Directors, will or may substantially affect the ability of the Group and of the Company to meet its obligations as and when they fall due. Change of Circumstances At the date of this report, the Directors are not aware of any circumstances, not otherwise dealt with in this report or the financial statements that would render any amount stated in the financial statements of the Group and of the Company misleading. Items of An Unusual Nature The results of the operations of the Group and of the Company for the financial year were not, in the opinion of the Directors, substantially affected by any item, transaction or event of a material and unusual nature. There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature, likely to affect substantially the results of the operations of the Group and of the Company for the current financial year in which this report is made. Annual Report

54 DIRECTORS S REPORT for the financial year ended 30 June 2009 Directors Directors who served since the date of the last report are: Tan Sri Samsudin bin Osman Johan bin Abdullah Dato Mohd Bakke bin Salleh Datuk Ismee bin Ismail Dato Dr. Abdul Halim bin Ismail Mohd Zin bin Idris Salih Amaran bin Jamiaan Zaiton binti Mohd Hassan Datuk Hairuddin bin Mohamed The interest and deemed interest in the shares of the Company and of its related corporations (other than wholly-owned subsidiaries) of those who were Directors at year end as recorded in the Register of Directors Shareholdings are as follows:- Number of ordinary shares of RM1 each At At Acquired Sold Interest in the Company Dato Dr. Abdul Halim bin Ismail 1,400 1,400 None of the other Directors holding office at 30 June 2009 had any interest in the ordinary shares of the Company and of its related corporations during the financial year. Directors Benefits Since the end of the previous financial year, no Director of the Company has received nor become entitled to receive any benefit (other than benefits included in the aggregate amount of emoluments received or due and receivable by the Directors as shown in the financial statements or the fixed salary of a full time employee of the Company) by reason of a contract made by the Company or a related corporation with the Director or with a firm of which the Director is a member, or with a company in which the Director has a substantial financial interest. There was no arrangement during and at the end of the financial year which had the object of enabling Directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate. Issue of Shares and Debentures During the financial year, the Company issued 175,400,000 new ordinary shares of RM1 each at par for cash for the purpose of subscribing to Islamic Convertible Redeemable Non-Cumulative Preference Shares issued by a subsidiary. There were no other changes in the issued and paid-up capital of the Company during the financial year. 52 Annual Report 2009

55 DIRECTORS S REPORT for the financial year ended 30 June 2009 Options Granted Over Unissued Shares No options were granted to any person to take up unissued shares of the Company during the financial year. Auditors The auditors, Messrs KPMG Desa Megat & Co., have indicated their willingness to accept re-appointment. Signed on behalf of the Board of Directors in accordance with a resolution of the Directors: Tan Sri Samsudin bin Osman Johan bin Abdullah Kuala Lumpur, 26 October 2009 Annual Report

56 Balance Sheets as at 30 June 2009 Group Company Note RM 000 RM 000 RM 000 RM 000 Assets Cash and short term funds 3 8,482,444 9,947, ,701 46,485 Deposits and placements with financial institutions 4 90, ,036 Securities held-for-trading 5 294,868 90,749 Securities available-for-sale 6 8,635,312 3,481,811 12,187 11,807 Securities held-to-maturity 7 162, ,534 Financing, advances and others 8 9,661,864 9,055, , ,000 Other assets , , Statutory deposit with Bank Negara Malaysia , ,151 Current tax assets 13,694 10,676 1,190 Asset classified as held for sale 12 1,471 39,364 Deferred tax assets 13 71, ,785 1,659 1,659 Investments in subsidiaries 14 1,295,231 1,295,231 Investments in associate Property, plant and equipment , , Prepaid lease payments 17 24,800 25,181 General Takaful and Family Takaful assets 18 3,947,615 3,661,515 Total assets 31,898,208 27,582,097 1,636,419 1,456,932 Liabilities Deposits from customers 19 24,871,451 20,535,907 Deposits and placements of banks and other financial institutions 20 8,078 58,443 Bills and acceptances payable 283, ,448 Other liabilities , ,980 8,018 7,239 Liabilities classified as held for sale 12 3,233 Zakat and tax 33,188 13, General Takaful and Family Takaful liabilities , ,716 General Takaful and Family Takaful participants funds 18 3,452,341 3,197,799 Total liabilities 29,531,314 25,642,778 8,018 7,728 Equity Share capital 23 1,066, ,390 1,066, ,390 Reserves 205, , , ,814 Total equity attributable to shareholders of the Company 1,272,533 1,005,284 1,628,401 1,449,204 Minority interests 1,094, ,035 Total equity 2,366,894 1,939,319 1,628,401 1,449,204 Total equity and liabilities 31,898,208 27,582,097 1,636,419 1,456,932 Commitments and contingencies 44 7,693,378 9,342,525 The notes on pages 61 to 115 are an integral part of these financial statements. 54 Annual Report 2009

57 Income Statements for the year ended 30 June 2009 Group Company Note RM 000 RM 000 RM 000 RM 000 Income derived from investment of depositors funds 24 1,017, ,108 Income derived from investment of shareholders funds , ,706 21,845 29,828 Allowance for losses on financing 26 (123,291) 7,547 Impairment loss 27 (4,663) 2,163 (6,455) Profit equalisation reserve 2,716 8,317 Direct expenses (16,563) (11,231) Total distributable income 1,348,379 1,433,610 21,845 23,373 Income attributable to depositors 28 (426,077) (415,089) Total net income 922,302 1,018,521 21,845 23,373 Personnel expenses 29 (314,996) (303,072) (4,325) (3,396) Other overhead expenses 30 (308,174) (335,834) (2,563) (2,376) Profit before zakat and tax 299, ,615 14,957 17,601 Zakat (7,303) (13,522) Tax expense 33 (84,121) 67,689 (1,846) (4,514) Profit for the year 207, ,782 13,111 13,087 Attributable to: Shareholders of the Company 113, ,198 13,111 13,087 Minority interests 94, ,584 Profit for the year 207, ,782 13,111 13,087 Earnings per share (sen) Dividend per ordinary share net (sen) The notes on pages 61 to 115 are an integral part of these financial statements. Annual Report

58 Consolidated Statement of Changes in Equity for the year ended 30 June 2009 Attributable to shareholders of the Company Non-distributable Trans- Accumu- Share Share Statutory lation Fair value Capital lated Minority capital premium reserve reserve reserve reserve losses Total interests Total Group Note RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 At 1 July , , ,204 15,305 15, ,370 (1,509,730) 923, ,803 1,605,927 Foreign exchange translation differences 9,090 9,090 8,256 17,346 Net loss on revaluation of securities available-for-sale (55,826) (55,826) (53,633) (109,459) Net gain/(loss) recognised directly in equity 9,090 (55,826) (46,736) (45,377) (92,113) Profit for the year 236, , , ,782 Total recognised income and expense for the year 9,090 (55,826) 236, , , ,669 Transfer to statutory reserve 97,950 (192,059) (94,109) 94,109 Minority interest subscription of shares of a subsidiary company 6,329 6,329 Dividends to shareholders 35 (13,193) (13,193) (13,193) Dividends to minority interest (1,413) (1,413) At 30 June , , ,154 24,395 (40,219) 638,370 (1,478,784) 1,005, ,035 1,939,319 The notes on pages 61 to 115 are an integral part of these financial statements. 56 Annual Report 2009

59 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 30 June 2009 Attributable to shareholders of the Company Non-distributable Trans- Accumu- Share Share Statutory lation Fair value Capital lated Minority capital premium reserve reserve reserve reserve losses Total interests Total Group Note RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 At 1 July , , ,154 24,395 (40,219) 638,370 (1,478,784) 1,005, ,035 1,939,319 Foreign exchange translation differences (10,412) (10,412) (10,363) (20,775) Net gain on revaluation of securities available-for-sale 37,643 37,643 35,803 73,446 Net (loss)/gain recognised directly in equity (10,412) 37,643 27,231 25,440 52,671 Profit for the year 113, ,659 94, ,708 Total recognised income and expense for the year (10,412) 37, , , , ,379 Transfer to statutory reserve 40,955 (80,303) (39,348) 39,348 Shares issued 175, , ,400 Dividends to shareholders 35 (9,693) (9,693) (9,693) Dividends to minority interest 1,489 1,489 At 30 June ,066, , ,109 13,983 (2,576) 638,370 (1,455,121) 1,272,533 1,094,361 2,366,894 The Statutory reserve is maintained in compliance with the provisions of the Islamic Banking Act, 1983 and is not distributable as cash dividends. The Capital reserve arose out of the issuance of bonus issue in a subsidiary of RM6,863,000 and gain arising from the dilution of interest in a subsidiary of RM631,507,000 and is not distributable as cash dividends. The notes on pages 61 to 115 are an integral part of these financial statements. Annual Report

60 Statements of Changes in Equity for the financial year ended 30 June 2009 Non-distributable Share Share Fair value (Accumulated capital premium reserve losses) Total Company Note RM 000 RM 000 RM 000 RM 000 RM 000 At 1 July , ,630 (217) (45,488) 1,449,315 Unrealised net loss on revaluation of securities available-for-sale (5) (5) Profit for the year 13,087 13,087 Total recognised income and expense for the year (5) 13,087 13,082 Dividends to shareholders 35 (13,193) (13,193) At 30 June , ,630 (222) (45,594) 1,449,204 Unrealised net gain on revaluation of securities available-for-sale Profit for the year 13,111 13,111 Total recognised income and expense for the year ,111 13,490 Shares issued 175, ,400 Dividends to shareholders 35 (9,693) (9,693) At 30 June ,066, , (42,176) 1,628,401 The notes on pages 61 to 115 are an integral part of these financial statements. 58 Annual Report 2009

61 Cash Flow Statements for the year ended 30 June 2009 Group Company RM 000 RM 000 RM 000 RM 000 Cash flows from operating activities Profit before zakat and tax 299, ,615 14,957 17,601 Adjustments for: Depreciation of property, plant and equipment 44,173 47, Amortisation prepaid lease payments Reversal of impairment losses of property, plant and equipment (2,153) (Reversal)/impairment losses on securities available-for-sale (100) 10,205 Impairment/(reversal) losses on securities held-to-maturity 5,994 (12,368) Impairment losses on investment in a subsidiary 6,455 Impairment losses on other receivables 10,557 (Reversal)/allowance for doubtful debts (3,293) 1,072 Allowance/(reversal) for losses on financing 123,291 (7,547) Allowance/(reversal) for diminution in value of investments 2,120 (580) Dividend from securities (6,466) (6,946) (17,571) (23,145) Net gain on disposal of investments (1,652) (Gain)/loss on disposal of property, plant and equipment (835) 137 Net (gain)/loss on sale of securities held-for-trading (3,096) 7,867 Net gain on sale of securities available-for-sale (3,436) (21,504) Accretion of discount less amortisation of premium (62,104) (28,272) Unrealised gain on security held-for-trading (5,738) Unrealised foreign exchange gain (26,178) Reversal of impairment loss on prepaid lease payment (120) Property, plant and equipment written off 22, Operating profit/(loss) before working capital changes 396, ,972 (2,358) (525) Changes in working capital: Deposits and placements of banks and other financial institutions (50,365) 24,452 Financing of customers (730,127) (644,196) Statutory deposits with Bank Negara Malaysia 222,422 34,488 Other receivables 24,872 (78,429) (13) (95) Deposits from customers 4,335,544 3,147,274 Other payables 4,557 41, (2,192) Bills payable (707,236) 881,259 Cash generated from/(used in) operations 3,496,446 3,774,661 (1,534) (2,812) Zakat paid (5,209) (9,620) Income taxes paid (35,156) (20,336) (3,526) (6,904) Tax refund 24,122 Net cash generated from/(used in) operating activities 3,456,081 3,768,827 (5,060) (9,716) Annual Report

62 CASH FLOW STATEMENTS for the year ended 30 June 2009 Group Company RM 000 RM 000 RM 000 RM 000 Cash flows from investing activities Net (purchase)/proceeds from disposal of securities (5,215,340) 203,930 22,620 Purchase of property, plant and equipment (57,225) (98,831) (56) (787) Proceeds from disposal of property, plant and equipment 20,175 6,406 Dividend from securities 6,466 6,946 17,571 23,145 Net cash (used in)/generated from investing activities (5,245,924) 118,451 17,515 44,978 Cash flows from financing activities Dividends paid (9,693) (14,606) (9,693) (13,193) Proceeds from issuance of share capital 175, ,400 Issuance of shares of a subsidiary to minority shareholders 1,489 6,329 Repayment from/(advances to) subsidiaries 54 (730) Net cash generated from/(used in) financing activities 167,196 (8,277) 165,761 (13,923) Net (decrease)/increase in cash and cash equivalents (1,622,647) 3,879, ,216 21,339 Cash and cash equivalents at the beginning of year 10,194,221 6,299,172 46,485 25,146 Foreign exchange differences 1,552 16,048 Cash and cash equivalents at the end of year 8,573,126 10,194, ,701 46,485 Cash and cash equivalents comprise: Cash and short term funds 8,482,444 9,947, ,701 46,485 Deposits and placements with financial institutions 90, ,036 8,573,126 10,194, ,701 46,485 The notes on pages 61 to 115 are an integral part of these financial statements. 60 Annual Report 2009

63 Notes to the Financial Statements BIMB Holdings Berhad is a public limited liability company, incorporated and domiciled in Malaysia and listed on the Main Market of Bursa Malaysia Securities Berhad. The address of its registered office and principal place of business are as follows: Registered office and principal place of business Level 18, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur. The consolidated financial statements as at and for the financial year ended 30 June 2009 comprise the Company and its subsidiaries (together referred to as the Group) and the Group s interest in associate. The Company is principally engaged in investment holding activities while the other Group entities are primarily involved in Islamic banking business, managing family and general takaful and provision of stockbroking businesses. The holding corporation of the Company during the financial year is Lembaga Tabung Haji, a statutory body established under the Tabung Haji Act 1995 (Act 535). The financial statements were approved by the Board of Directors on 26 October Basis of Preparation (a) Statement of compliance The financial statements of the Group and of the Company have been prepared in accordance with the applicable Financial Reporting Standards (FRS) issued by the Malaysian Accounting Standards Board (MASB) as modified by Bank Negara Malaysia Guidelines, the provisions of the Companies Act, 1965 and Shariah requirements. The Group and the Company have not applied the following accounting standards (including its consequential amendments) and interpretations that have been issued by the Malaysian Accounting Standards Board (MASB) but are not yet effective: FRSs / Interpretations Effective date Amendments to FRS 1, First-time Adoption of Financial Reporting Standards 1 January 2010 and FRS 127, Consolidated and Separate Financial Statements: Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate Amendments to FRS 2, Share-based Payment: Vesting Conditions and Cancellations 1 January 2010 FRS 4, Insurance Contracts 1 January 2010 FRS 7, Financial Instruments: Disclosures 1 January 2010 FRS 8, Operating Segments 1 July 2009 FRS 123, Borrowing Costs 1 January 2010 FRS 139, Financial Instruments: Recognition and Measurement 1 January 2010 IC Interpretation 9, Reassessment of Embedded Derivatives 1 January 2010 IC Interpretation 10, Interim Financial Reporting and Impairment 1 January 2010 IC Interpretation 11, FRS 2 Group and Treasury Share Transactions 1 January 2010 IC Interpretation 13, Customer Loyalty Programmes 1 January 2010 IC Interpretation 14, FRS 119 The Limit on a Defined Benefit Asset, 1 January 2010 Minimum Funding Requirements and Their Interaction Annual Report

64 NOTES TO THE FINANCIAL STATEMENTS 1. Basis of Preparation (Cont d) (a) Statement of compliance (Cont d) The Group plans to apply FRS 8 from the annual period beginning 1 July The Group and the Company plan to apply the other FRSs and Interpretations from the annual period beginning 1 July The impact of applying FRS 4, FRS 7 and FRS 139 on the financial statements upon first adoption as required by paragraph 30(b) of FRS 108, Accounting Policies, Changes in Accounting Estimates and Errors is not disclosed by virtue of the exemptions given in the respective FRSs. Other than the implications as discussed below, the initial application of the above standards (and its consequential amendments) and interpretations is not expected to have any material impact on the financial statements of the Group and the Company. FRS 8, Operating Segment FRS 8 will become effective for financial statements for the year ending 30 June FRS 8, which replaces FRS 114, Segment Reporting, requires identification and reporting of operating segments based on internal reports that are regularly reviewed by the entity s chief operating decision maker in order to allocate resources to the segment and to assess its performance. Currently, the Group presents segment information in respect of its business segments (see note 43). Under FRS 8, the Group will present segment information in respect of its operating segments. (b) (c) Basis of measurement The financial statements have been prepared on the historical cost basis except for the following assets as explained in their respective accounting policy notes: Securities held-for-trading Securities available-for-sale Derivatives financial instruments Functional and presentation currency These financial statements are presented in Ringgit Malaysia (RM), which is the Company s functional currency. All financial information presented in RM has been rounded to the nearest thousand, unless otherwise stated. (d) Use of estimates and judgements The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. In particular, information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements are described in the following note: Note 2 (e) Allowance for bad and doubtful financing Note 2 (f) Valuation of Securities Note 2 (s) Deferred tax assets 62 Annual Report 2009

65 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies The accounting policies set out below have been applied consistently to all periods presented in these financial statements, and have been applied consistently by Group entities, unless otherwise stated. (a) Basis of consolidation (i) Subsidiaries Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. Investments in subsidiaries are stated in the Company s balance sheet at cost less impairment losses. (ii) Associates Associates are entities, including unincorporated entities, in which the Group has significant influence, but not control, over the financial and operating policies. Associates are accounted for in the consolidated financial statements using the equity method. The consolidated financial statements include the Group s share of the profit or loss of the equity accounted associates, after adjustments, if any, to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. When the Group s share of losses exceeds its interest in an equity accounted associate, the carrying amount of that interest (including any long-term investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee. Investments in associates are stated in the Company s balance sheet at cost less any impairment losses. (iii) Changes in Group composition Where a subsidiary issues new equity shares to minority interests for cash consideration and the issue price has been established at fair value, the reduction in the Group s interests in the subsidiary is accounted for as a disposal of equity interest with the corresponding gain or loss recognised in the income statement. When a group purchases a subsidiary s equity shares from minority interests for cash consideration and the purchase price has been established at fair value, the accretion of the Group s interests in the subsidiary is accounted for as a purchase of equity interest for which the acquisition accounting method of accounting is applied. The Group treats all other changes in group composition as equity transactions between the Group and its minority shareholders. Any difference between the Group s share of net assets before and after the change, and any consideration received or paid, is adjusted to or against Group reserves. Annual Report

66 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (a) Basis of consolidation (Cont d) (iv) Minority interest Minority interest at the balance sheet date, being the portion of the net identifiable assets of subsidiaries attributable to equity interests that are not owned by the Company, whether directly or indirectly through subsidiaries, are presented in the consolidated balance sheet and statement of changes in equity within equity, separately from equity attributable to the equity shareholders of the Company. Minority interest in the results of the Group are presented on the face of the consolidated income statement as an allocation of the total profit or loss for the year between minority interest and the equity shareholders of the Company. Where losses applicable to the minority exceed the minority s interest in the equity of a subsidiary, the excess, and any further losses applicable to the minority, are charged against the Group s interest except to the extent that the minority has a binding obligation to, and is able to, make additional investment to cover the losses. If the subsidiary subsequently reports profits, the Group s interest is allocated with all such profits until the minority s share of losses previously absorbed by the Group has been recovered. (v) Transactions eliminated on consolidation Intra-group balances, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with equity accounted investees are eliminated against the investment to the extent of the Group s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment. (b) Foreign currency (i) Foreign currency transactions Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the exchange rate at that date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined. Foreign currency differences arising on retranslation are recognised in the income statement. (ii) Operations denominated in functional currencies other than Ringgit Malaysia The assets and liabilities of operations in functional currencies other than RM, including goodwill and fair value adjustments arising on acquisition, are translated to RM at exchange rates at the balance sheet date. The income and expenses of foreign operations are translated to RM at average exchange rates for the year. All resulting exchange differences are taken to the foreign currency translation reserve within equity. On disposal, accumulated translation differences are recognised in the consolidated income statement as part of the gain or loss on sale. 64 Annual Report 2009

67 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (b) Foreign currency (continued) (iii) Net investment in foreign operations Exchange differences arising from monetary items that in substance form part of the Group s net investment in foreign operations, where that monetary item is denominated in either the functional currency of the reporting entity or the foreign operations are taken to the foreign currency translation reserve within equity in the Group s financial statements. Exchange differences are only released to the income statement upon disposal of the foreign operations. (c) Intangible assets (i) Goodwill Goodwill arises on the acquisition of subsidiaries and associates. Goodwill represents the excess of the cost of the acquisition over the Group s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the acquiree. Goodwill is measured at cost and tested for impairment at least annually or more frequently when there is objective evidence of impairment. Goodwill is allocated to cash-generating units and is tested annually for impairment or more frequently if events or changes in circumstances indicate that it might be impaired. In respect of equity accounted investees, the carrying amount of goodwill is included in the carrying amount of the investment. The entire carrying amount of the investment is tested for impairment when there is objective evidence of impairment. (ii) Acquisition of minority interest Goodwill arising on the acquisition of a minority interest in a subsidiary represents the excess of the cost of the additional investment over the carrying amount of the net assets acquired at the date of exchange. (d) Derivative financial instruments The Group holds derivative financial instruments to hedge its foreign currency exposure. Foreign exchange trading positions, including spot and forward contracts, are revalued at prevailing market rates at balance sheet date and the resultant gains and losses for the financial year are recognised in the income statement. Annual Report

68 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (e) Financing Financing is stated after deducting the allowance for losses on financing. Allowance for bad and doubtful financing Specific allowances are made for bad and doubtful financing, which have been individually reviewed and specifically identified as bad and doubtful. A general allowance based on a percentage of the financing portfolio (net of specific allowance for bad and doubtful financing) is also made. These percentages are reviewed annually in the light of past experiences and prevailing circumstances and an adjustment is made to the overall general allowance, if necessary. An uncollectible financing or portion of a financing classified as bad is written off after taking into consideration the realisable value of collateral, if any, when in the judgement of the management, there is no prospect of recovery. Allowances for bad and doubtful financing are computed in conformity with BNM GP3 (September 1998). (f) Securities The holdings of the securities portfolio of the Group and the Company are recognised based on the following categories and consequently their valuation methods: (i) Securities held-for-trading Securities are classified as held-for-trading if it is acquired or incurred principally for the purpose of selling or repurchasing it in the near term or it is part of a portfolio of identified securities that are managed together and for which there is evidence of a recent actual pattern of short-term profit-taking. Securities classified as held-for-trading will be stated at fair value and any gain or loss arising from a change in the fair value will be recognised in income statement. (ii) Securities available-for-sale Available-for-sale securities are securities that are not classified as held-for- trading or held-to-maturity and are measured at fair value. Securities in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are stated at cost. Any gain or loss arising from a change in the fair value is recognised directly in equity through the statement of changes in equity until the securities are sold, disposed off or impaired, at which time the cumulative gains or losses previously recognised in equity will be transferred to income statement. Profit from the available-for-sale securities is recognised in the income statement. (iii) Securities held-to-maturity Held-to-maturity securities are securities with fixed or determinable payments and fixed maturity that the Company has the positive intention and ability to hold to maturity. These securities are measured at amortised cost using the effective profit method. A gain or loss is recognised in the income statement when the securities are derecognised or impaired, as well as amortisation of premium and accretion of discounts. 66 Annual Report 2009

69 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (g) Property, plant and equipment (i) Recognition and measurement All items of property and equipment are stated at cost less accumulated depreciation and impairment losses, if any. Property and equipment retired from active use and held for disposal are stated at the carrying amount at the date when the asset is retired from active use, less impairment losses, if any. Cost includes expenditures that are directly attributable to the acquisition of the asset and any other costs directly attributable to bringing the asset to working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. The cost of selfconstructed assets also includes the cost of materials and direct labour. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. The cost of property, plant and equipment recognised as a result of a business combination is based on fair value at acquisition date. The fair value of property is the estimated amount for which a property could be exchanged between a willing buyer and a willing seller in an arm s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. The fair value of other items of plant and equipment is based on the quoted market prices for similar items. When significant parts of an item of property and equipment have different useful lives, they are accounted for as separate items (major components) of property and equipment. Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognised net within other income or other operating expenses respectively in the income statements. (ii) Subsequent costs The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The carrying amount of those parts that are replaced is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in the income statement as incurred. Annual Report

70 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (g) Property, plant and equipment (Cont d) (iii) Depreciation Depreciation is recognised in the income statements on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Freehold land is not depreciated. Property, plant and equipment under construction are not depreciated until the assets are ready for their intended use. The estimated useful lives for the current and comparative periods are as follows: Buildings Building improvement and renovations Furniture, fixtures and fittings Office equipment Motor vehicles Computer equipment and software 99 years 6 years 2 6 years 2 6 years 4 years 2 6 years Depreciation methods, useful lives and residual values are reassessed at the balance sheet date. (h) Impairment The carrying amounts of assets except for financial assets (other than securities held-to-maturity and available-forsale) are reviewed at each reporting date to determine whether there is any indication of impairment. The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the cash-generating unit ). An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the income statements. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other assets in the unit (groups of units) on a pro rata basis. An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Reversals of impairment losses are credited to the income statement in the year in which the reversals are recognised. (i) Bills and other receivables Bills and other receivables are stated at cost less allowance for doubtful debts. 68 Annual Report 2009

71 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (j) Cash and cash equivalents Cash and cash equivalents include cash and short-term funds, and deposits and placements with banks and other financial institutions. (k) Bills and acceptances payable Bills and acceptances payable represent the Group s own bills and acceptances rediscounted and outstanding in the market. (l) Liabilities Deposits from customers and deposits and placements of banks and financial institutions are stated at placement values. Other payables are measured initially and subsequently at cost. Other payables are recognised when there is a contractual obligation to deliver cash or another financial asset to another entity. (m) Leased assets Leasehold land that normally has an indefinite economic life and the title is not expected to be passed to the lessee by the end of the lease term is treated as an operating lease. The payment made on entering into or acquiring a leasehold land is accounted for as prepaid lease payments. The Group had previously classified a lease of land as finance lease and had recognised the amount of prepaid lease payments as property and equipment. On adoption of FRS 117, Leases, the Group treats such a lease as an operating lease, with the unamortised carrying amount classified as prepaid lease payments in accordance with the transitional provisions in FRS A. The prepaid lease payments are amortised on a straight-line basis over the lease term. (n) Family Takaful Fund Included in Family Takaful Fund is fund arising from:- (i) (ii) (iii) Family Takaful; Group Family Takaful; and Family Retakaful Funds. The Family Takaful Fund is maintained in accordance with the requirements of the Takaful (Amendment) Act, 1984 and includes the amounts attributable to participants which represents the participants share of the return on the investments and are distributable in accordance with the terms and conditions prescribed by the Group. The surplus transferable from the Family Takaful Fund to the income statement is based on the surplus determined by an annual actuarial valuation of the long term liabilities to the participants. Annual Report

72 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (n) Family Takaful Fund (Cont d) Contributions income Contribution is recognised as soon as the amount of the contribution can be reliably measured. Initial contribution is recognised from inception date and subsequent contribution is recognised when it is due. For Individual family takaful contribution, recognition is up to the extent of one due amount. At the end of each financial period, all due contributions are accounted for to the extent that they can be reliably measured. Investment-linked business Investments of investment-linked business are stated at closing market prices. Any increase or decrease in value of these investments is taken into the investment-linked business revenue account. Actuarial reserves Actuarial reserves comprise the unearned contribution reserves and the reserve computed under the net contribution valuation as explained below: (i) Unearned contribution reserve The Unearned Contributions Reserve (UCR) of group family fund (except for Mortgage Reducing Term Takaful ( MRTT as detailed below) products) and family retakaful fund represents the portion of the net contributions of takaful certificates written that relate to the unexpired periods of the certificates at the end of the financial year. In determining the UCR at balance sheet date, the method that most accurately reflects the actual unearned contributions is used, as follows: (a) 1/365 th method for all group family takaful business within Malaysia. (b) A pro-rata basis based on a time apportionment method for family retakaful business. (ii) Net contribution valuation The actuarial liability for MRTT products managed under group family fund and Participants Special Account (PSA) are calculated using net contribution method of valuation ( NCV ). The liability is ascertained by deducting the present value of future net contribution from the present value of the future amount-at-risk. As with all projections, there are elements of uncertainty and the projected liability may be different from actual. These uncertainties arise from changes in underlying risk, changes in spread of risks, claims settlement pattern as well as uncertainties in the projection model and underlying assumptions. 70 Annual Report 2009

73 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (n) Family Takaful Fund (Cont d) Provision for outstanding claims Claims and settlement costs that are incurred during the financial year are recognised when a claimable event occurs and/or the Takaful operator is notified. Claims and provisions for claims arising on family and group family Takaful certificates, including settlement costs, are accounted for using the case basis method and for this purpose; the benefits payable under a family Takaful certificates are recognised as follows: (i) (ii) (iii) maturity or other policy benefit payments due on specified dates are treated as claims payable on the due dates. death, surrender and other benefits without due dates are treated as claims payable, on the date of receipt of intimation of death of the participant or occurrence of contingency covered. for group health business, provision is made for the cost of claims, together with related expenses, incurred but not reported ( IBNR ) at balance sheet date, using a mathematical method of estimation by a qualified actuary where historical claims experience are used to project future claims. As with all projections, there are elements of uncertainty and the projected claim may be different from actual. (o) General Takaful Fund The General Takaful Fund is maintained in accordance with the Takaful Act, 1984 (amendment). Included in General Takaful fund is fund arising from: (i) (ii) (iii) General Takaful; Asean Takaful Group ( ATG ) retakaful pool; and General retakaful funds. The general Takaful underwriting results are determined for each class of Takaful business after taking into account retakaful, unearned contributions, claims incurred and management expenses. Contributions income Contributions are recognised in a financial period in respect of risks assumed during that particular financial period based on the inception date. Inward treaty retakaful contributions are recognised on the basis of periodic advices received from ceding takaful operators. Unearned contributions reserve ( UCR ) The UCR represents the portion of the net contributions of Takaful certificates written that relate to the unexpired periods of the certificates at the end of the financial year. In determining the UCR at balance sheet date, the method that most accurately reflects the actual unearned contributions is used, as follows: (i) (ii) 1/365 th method for all general Takaful business within Malaysia. 1/8 th method for all classes of General Inward Takaful business. Annual Report

74 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (o) General Takaful Fund (Cont d) Provision for outstanding claims A liability for outstanding claims is recognised in respect of direct Takaful business. The amount of outstanding claims is the best estimate of the expenditure required together with related expenses less recoveries, if any, to settle the present obligation at the balance sheet date. Any difference between the current estimated cost and subsequent settlement is dealt with in the Takaful revenue account for the Group in the year in which the settlement takes place. Provision is also made for the cost of claims, together with related expenses, incurred but not reported ( IBNR ) at balance sheet date, using a mathematical method of estimation by a qualified independent actuary where historical claims experience are used to project future claims. As with all projections, there are elements of uncertainty and the projected claim may be different from actual. These uncertainties arise from changes in underlying risk, changes in spread of risks, claims settlement pattern as well as uncertainties in the projection model and underlying assumptions. (p) Profit equalisation reserve ( PER ) PER refers to the amount appropriated out of or written back to the total gross income to reduce the fluctuations in the profit rates payable to the depositors. It is in conformity with The Framework of the Rate of Return or BNM/GP2-i issued by Bank Negara Malaysia. PER is reflected under other liabilities of the Bank. (q) Share capital Ordinary shares are classified as equity in the balance sheet. Cost directly attributable to the issuance of new equity shares are taken to equity as a deduction from the proceeds. (r) Income recognition Finance income Finance income is recognised on an accrual basis. Income on cash line, house and term financing is accounted for on a constant rate of return basis by reference to the rest periods as stipulated in the financing agreement. Where a financing account becomes non-performing, profit accrued and recognised as income prior to the date the account is classified as non-performing is reversed out of income. Thereafter, profit on the non-performing financing shall only be recognised as income on a cash basis. Income is not recognised on customers accounts where repayments are in arrears for more than six months from the first day of default for financing, cash line and advances; and three months from the first day of default for trade bills, credit cards, bankers acceptances, trust receipts and other instruments of similar nature. 72 Annual Report 2009

75 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (r) Income recognition (Cont d) Fee and other income recognition Financing arrangement, management and participation fees, underwriting commissions and brokerage fees are recognised as income based on contractual arrangements. Guarantee fee is recognised as income upon issuance of the guarantee. Fees from advisory and corporate finance activities are recognised net of service taxes and discounts on completion of each stage of the assignment. Dividend income from subsidiary and associated companies and other investments are recognised when the Company s rights to receive payment is established. (s) Tax expense Tax expense comprises current and deferred tax. Tax expense is recognised in the income statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years. Deferred tax is recognised using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of goodwill, the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit (tax loss). Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax liability is recognised for all taxable temporary differences. A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Additional taxes that arise from the distribution of dividends are recognised at the same time as the liability to pay the related dividend is recognised. (t) (u) Zakat This represents business zakat. It is an obligatory amount payable by the Group to comply with the principles of Shariah. Employee benefits Short term employee benefits Short-term employee benefit obligations in respect of salaries, annual bonuses, paid annual leave and sick leave are measured on an undiscounted basis and are expensed as the related service is provided. Annual Report

76 NOTES TO THE FINANCIAL STATEMENTS 2. Significant Accounting Policies (Cont d) (u) Employee benefits (Cont d) Short term employee benefits (Cont d) A provision is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. The Group s contribution to statutory pension funds are charged to the income statements in the year to which they relate. Once the contributions have been paid, the Group has no further payment obligations. Share-based payment transactions The grant date fair value of options granted to employees is recognised as an employee expense, with a corresponding increase in equity, over the period that the employees become unconditionally entitled to the options. The amount recognised as an expense is adjusted to reflect the actual number of share options that vest. The fair value of employee share options is measured using a Black Scholes model. Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based on historical experience and general option holder behaviour), expected dividends, and the risk-free interest rate (based on government bonds). Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value. (v) Non-current assets held for sale Non-current assets (or disposal groups comprising assets and liabilities) that are expected to be recovered primarily through sale rather than through continuing use are classified as held for sale. Immediately before classification as held for sale, the assets (or components of a disposal group) are remeasured in accordance with the Group s accounting policies. Thereafter generally the assets (or disposal group) are measured at the lower of their carrying amount and fair value less cost to sell. Any impairment loss on a disposal group first is allocated to goodwill, and then to remaining assets and liabilities on pro rata basis, except that no loss is allocated to financial assets, deferred tax assets and investment property, which continue to be measured in accordance with the Group s accounting policies. Impairment losses on initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in the income statements. Gains are not recognised in excess of any cumulative impairment loss. 74 Annual Report 2009

77 NOTES TO THE FINANCIAL STATEMENTS 3. Cash and Short Term Funds Group Company RM 000 RM 000 RM 000 RM 000 Cash and balances with banks and other financial institutions 663, , ,701 46,485 Money at call and interbank placements with remaining maturity not exceeding one month 7,819,174 9,430,256 8,482,444 9,947, ,701 46, Deposits and Placements with Financial Institutions Group RM 000 RM 000 Licensed banks 90,682 72,036 Licensed finance companies 175,000 90, , Securities Held-for-Trading Group RM 000 RM 000 At fair value: Quoted securities in Malaysia Shares 7,240 34,289 Quoted securities outside Malaysia Shares 2,001 7,240 36,290 Unquoted securities in Malaysia Malaysian Government Investment Issues 149,737 Islamic Commercial Papers 137,891 29,896 Islamic Debt Securities 24, ,628 54, ,868 90,749 Annual Report

78 NOTES TO THE FINANCIAL STATEMENTS 6. Securities Available-for-Sale Group Company RM 000 RM 000 RM 000 RM 000 At fair value: Quoted securities in Malaysia Unit trust 45,254 16,313 12,187 11,807 Shares 22,506 67,760 16,313 12,187 11,807 At fair value: Quoted securities outside Malaysia Bond 70,380 81,650 At fair value: Unquoted securities in Malaysia Malaysian Government Investment Issues 2,651, ,089 Negotiable Islamic Debt Certificates 1,437, ,984 Islamic Commercial Papers 453, ,787 Islamic Debt Securities 3,822,367 1,920,009 Accepted Bills 107,997 73,623 Promissory notes 5,604 5,604 8,479,321 3,366,096 At fair value: Unquoted securities outside Malaysia Islamic Development Bank Unit Trust 1,923 1,928 At cost: Unquoted securities in Malaysia Unquoted shares 28,720 27,525 Less: Impairment losses (15,835) (14,697) 12,885 12,828 At cost: Unquoted securities outside Malaysia Unquoted shares 3,043 25,858 Less: Impairment losses (22,862) 3,043 2,996 8,635,312 3,481,811 12,187 11, Annual Report 2009

79 NOTES TO THE FINANCIAL STATEMENTS 7. Securities Held-to-Maturity Group RM 000 RM 000 Unquoted securities in Malaysia Islamic Debt Securities 175, ,814 Less: Impairment losses (12,287) (18,280) 162, , Financing, Advances and Others Group RM 000 RM 000 (i) By type Cash line 164, ,463 Term financing House financing 7,136,157 5,878,379 Syndicated financing 81, ,339 Leasing receivables 329, ,234 Bridging financing 299, ,504 Personal financing 2,733,611 2,425,401 Other term financing 3,874,823 3,931,500 Staff financing 298, ,579 Credit cards 393, ,100 Trade bills discounted 1,539,200 1,684,209 Trust receipts 151, ,518 Others ,001,587 15,478,678 Less: Unearned income (6,290,584) (5,026,137) 10,711,003 10,452,541 Less: Allowance for bad and doubtful financing: General (170,844) (169,382) Specific (878,295) (1,228,131) Total net financing, advances and others 9,661,864 9,055,028 Annual Report

80 NOTES TO THE FINANCIAL STATEMENTS 8. Financing, Advances and Others (Cont d) Group RM 000 RM 000 (ii) By contract Bai Bithaman Ajil (deferred payment sale) 5,719,619 5,506,976 Ijarah (operating lease) 289, ,063 Ijarah Muntahia Bittamlik/AITAB (finance lease) 28,367 30,334 Mudharabah (profit sharing) 8,934 9,249 Murabahah (cost-plus) 1,680,071 1,848,516 Bai Al-Inah Cash Note 1,611,717 1,583,186 Bai Al-Inah 662, ,527 Istisna 543, ,988 At-Tawarruq 167,378 Others 12,702 10,711,003 10,452,541 (iii) By type of customer Domestic non-bank financial institutions 12,459 36,587 Domestic business enterprise 2,508,922 2,323,618 Small medium industries 867,061 1,212,486 Government 156, ,523 Individuals 7,146,713 6,739,803 Other domestic entities 17,932 29,717 Foreign entities 1,006 1,807 10,711,003 10,452,541 (iv) By profit rate sensitivity Fixed rate House financing 2,298,214 2,895,886 Others 7,462,649 6,896,698 Floating rate Others 950, ,957 10,711,003 10,452, Annual Report 2009

81 NOTES TO THE FINANCIAL STATEMENTS 8. Financing, Advances and Others (Cont d) Group RM 000 RM 000 (v) By sector Agriculture, hunting, forestry and fishing 116, ,141 Mining and quarrying 30,736 30,679 Manufacturing 828,998 1,166,209 Electricity, gas and water 80,011 81,913 Construction 520, ,137 Real estate 46,879 51,508 Purchase of landed property: Residential 3,217,361 2,863,192 Non-residential 318, ,305 Wholesale, retail trade, restaurants and hotels 336, ,809 Transport, storage and communication 58,734 82,792 Finance, insurance and business services 76, ,227 Purchase of securities 153, ,876 Purchase of transport vehicles 1,452,351 1,505,597 Consumption credit 2,304,782 1,986,070 Community, social and personal 42,456 59,333 Others 1,126, ,753 10,711,003 10,452,541 Company RM 000 RM 000 Subordinated Mudharabah financing 100, ,000 The amount refers to a subordinated Mudharabah financing facility granted to a subsidiary, Bank Islam Malaysia Berhad which is subordinated to all other liabilities of the subsidiary, and matures in year Pursuant to Bank Negara Malaysia s approval on 21 April 2009, under the first tranche of Bank Islam Malaysia Berhad s recapitalization exercise, completed on 1 July 2009 with the issuance of 324 million Islamic Convertible Preference Shares, the Company s entitlement of million of said equity instrument, as stated in Note 45, was partly financed by the redemption of the RM100 million Subordinated Mudharabah financing. Annual Report

82 NOTES TO THE FINANCIAL STATEMENTS 9. Non-performing Financing, Advances and Others (i) Movement in the non-performing financing, advances and others Group RM 000 RM 000 At 1 July 1,949,904 2,192,151 Classified as non-performing during the year 228, ,526 Reclassified as performing during the year (131,580) (67,274) Amount recovered (184,080) (500,307) Amount written off (540,033) (61,403) Exchange differences 37,807 (34,789) At 30 June 1,360,449 1,949,904 Less: Specific allowance (878,295) (1,228,131) Net non-performing financing, advances and others 482, ,773 Ratio of net non-performing financing to total net financing, advances and others 4.90% 7.82% (ii) Movement in allowance for bad and doubtful financing Group RM 000 RM 000 General allowance At 1 July 169, ,461 Exchange differences 1,462 (1,079) At 30 June 170, ,382 Ratio of general allowance to total net financing, advances and others 1.74% 1.84% Specific allowance At 1 July 1,228,131 1,211,263 Allowance made during the year 303, ,924 Amount recovered (133,074) (213,858) Amount written off (540,033) (53,613) Exchange differences 19,516 (16,585) At 30 June 878,295 1,228, Annual Report 2009

83 NOTES TO THE FINANCIAL STATEMENTS 9. Non-performing Financing, Advances and Others (Cont d) (iii) Non-performing financing by sector Group RM 000 RM 000 Agriculture, hunting, forestry and fishing 39,788 51,591 Mining and quarrying 280 1,959 Manufacturing 288, ,000 Electricity, gas and water 77,334 78,507 Construction 367, ,522 Real estate 1,745 4,243 Purchase of landed property: Residential 212, ,821 Non-residential 76, ,924 Wholesale and retail trade and restaurants and hotel 95, ,835 Transport, storage and communication 12,811 16,091 Finance, insurance and business services 1, Purchase of securities 6,737 70,230 Purchase of transport vehicles 35,928 61,019 Consumption credit 101, ,252 Community, social and personal 14,430 17,654 Others 28,014 56,756 At 30 June 1,360,449 1,949, Other Assets Group Company RM 000 RM 000 RM 000 RM 000 Bill receivables ,056 Clients and dealers debit balances 13,938 6,035 Due from Takaful funds* 62,265 91,056 Amount due from subsidiaries Deposits and prepayments 20,997 20, Other receivables** 112,762 57, , , * Included in amount due from Takaful funds is Qardh Hasan receivables amounting to RM31,722,000 (2008: RM80,861,000). Qardh Hasan is required to make good deficit arising in the Takaful funds. ** Other receivables of the Group is stated net of allowances for doubtful debts of RM97,693,000 (2008: RM87,148,000). Annual Report

84 NOTES TO THE FINANCIAL STATEMENTS 11. Statutory Deposit with Bank Negara Malaysia The non-interest bearing statutory deposits are maintained with Bank Negara Malaysia in compliance with Section 37(1) (c) of the Central Bank of Malaysia Act, 1958 (revised 1994), the amount of which are determined as set percentages of total eligible liabilities. 12. Assets and Liabilities Classified as Held for Sale Group RM 000 RM 000 Assets classified as held for sale Property, plant and equipment Investments 30,925 Receivables, deposits and prepayments 8,229 Reclassified from investment properties 890 1,471 39,364 Liabilities classified as held for sale Payables and accruals 3,233 Property, plant and equipment Property, plant and equipment held for sale comprise the following: Group RM 000 RM 000 Plant and equipment: Cost 943 1,654 Accumulated depreciation (362) (1,444) Annual Report 2009

85 NOTES TO THE FINANCIAL STATEMENTS 13. Deferred Tax Assets Recognised deferred tax assets and liabilities Deferred tax assets and liabilities are attributable to the following: Assets Liabilities Net RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 Group Allowances for losses on financing 37,628 39,605 37,628 39,605 Property, plant and equipment (7,554) (7,528) (7,554) (7,528) Receivables (751) (14,559) (751) (14,559) Tax loss carry-forwards , ,529 Unabsorbed capital allowance Impairment loss 11,592 19,059 11,592 19,059 Provisions 30,584 33,659 30,584 33,659 Other items (295) (295) Tax assets 80, ,872 (8,600) (22,087) 71, ,785 Company Other items 1,659 1,659 1,659 1,659 Unrecognised deferred tax assets Deferred tax assets have not been recognised in respect of the following items: Group RM 000 RM 000 Impairment losses 5,542 Unutilised tax losses 109 Unabsorbed capital allowances 43, Other temporary differences 53 43,784 5,715 Deferred tax assets have not been recognised in respect of these items because it is uncertain whether the Group is able to utilise the benefits in the future. The current year s unabsorbed capital allowances is in respect of its subsidiary s leasing business whereby the subsidiary considered it uncertain whether they are able to utilise the benefits in the future. Annual Report

86 NOTES TO THE FINANCIAL STATEMENTS 14. Investments in Subsidiaries Company RM 000 RM 000 At cost Quoted shares in Malaysia 106, ,986 Unquoted shares in Malaysia 1,351,237 1,351,237 1,458,223 1,458,223 Less: Impairment losses (162,992) (162,992) 1,295,231 1,295,231 Market value: Quoted shares in Malaysia 133, ,784 Details of the subsidiaries are as follows: Ownership Name of Company Principal activities interest % % Bank Islam Malaysia Berhad Islamic banking Subsidiaries of Bank Islam Malaysia Berhad Bank Islam (L) Ltd Ceased operation BIMB Investment Management Berhad Manager of BIMB Unit Trust Fund (formerly known as BIMB Unit Trust Management Berhad) BIMB Foreign Currency Foreign currency clearing house Clearing Agency Sdn. Bhd. Al-Wakalah Nominees (Tempatan) Sdn. Bhd. Provides nominee services BIMB Trust Company (Labuan) Ltd. Provides trust and related services Subsidiary of BIMB Trust Company (Labuan) Ltd. BIMB Offshore Company Management Dormant Services Sdn. Bhd. Syarikat Takaful Malaysia Berhad Family and general Takaful business Annual Report 2009

87 NOTES TO THE FINANCIAL STATEMENTS 14. Investments in Subsidiaries (Cont d) Ownership Name of Company Principal activities interest % % Subsidiaries of Syarikat Takaful Malaysia Berhad ASEAN Retakaful International (L) Ltd^ Offshore retakaful business P.T. Syarikat Takaful Indonesia* # Holding company Subsidiaries of P.T. Syarikat Takaful Indonesia P.T. Asuransi Takaful Umum* # General Takaful business P.T. Asuransi Takaful Keluarga* # Family Takaful business BIMB Securities (Holdings) Sdn. Bhd. Investment holding company Subsidiary of BIMB Securities (Holdings) Sdn. Bhd. BIMB Securities Sdn. Bhd. Stockbroking company Subsidiaries of BIMB Securities Sdn. Bhd BIMSEC Asset Management Sdn. Bhd. Provides investment management services BIMSEC Nominees (Tempatan) Sdn. Bhd Provides nominee services BIMSEC Nominees (Asing) Sdn. Bhd. Provides nominee services Syarikat Al-Ijarah Sdn. Bhd. Leasing of assets Pembiayaan Perumahan Nasional Sdn. Bhd. Dormant BIMB Venture Capital Sdn. Bhd. Provides advisory, consultancy and related investment services BIMB Musyarakah Satu Sdn. Bhd. Venture capital company and investment company * Incorporated in Indonesia. ^ Audited by a firm of auditors affiliated with KPMG Desa Megat & Co. # Audited by a firm of auditors other than KPMG Desa Megat & Co. Annual Report

88 NOTES TO THE FINANCIAL STATEMENTS 15. Investments in Associate Group Company RM 000 RM 000 RM 000 RM 000 At cost Unquoted shares in Malaysia 7,492 7,492 5,019 5,019 Less: Share of post-acquisition losses (2,473) (2,473) Impairment losses (4,870) (4,870) (4,870) (4,870) The principal activities of the associates, incorporated in Malaysia (unless otherwise stated), and the interest of the Group are as follows: Ownership Name of Company Principal activity interest % % Islamic Banking and Finance Institute Provides training and consultancy Malaysia Sdn. Bhd. services Annual Report 2009

89 NOTES TO THE FINANCIAL STATEMENTS 16. Property, Plant and Equipment Furniture, Computer Group **Land fixtures equipment and and Office Motor and building fittings equipment vehicles software Total Cost RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 At 1 July ,048 94, ,579 3, , ,729 Additions 18,399 17,515 10, ,993 98,831 Reclassifications (3,234) 21,740 5,257 (38,459) (14,696) Transfer to assets held for sale (664) (992) (62) (1,718) Disposals (391) (5,999) (1,867) (682) (8,939) Written off (774) (4,490) (494) (5,758) Exchange difference 119 (581) (4) (76) (542) At 30 June 2008/1 July , , ,216 3, , ,907 Additions 10,980 9,348 15,332 21,565 57,225 Reclassifications (32,076) 25,199 22, (15,694) (293) Transfer to assets held for sale (943) (943) Disposals (16,530) (410) (3,366) (208) (38) (20,552) Written off (10,702) (49) (165) (19,751) (30,667) Exchange difference (49) (25) At 30 June , , ,369 2, , ,795 Depreciation and impairment loss At 1 July 2007 Accumulated depreciation 22,305 73, ,183 2, , ,256 Accumulated impairment loss 13,577 13,577 35,882 73, ,183 2, , ,833 Depreciation of the year 3,600 20,928 15, ,164 47,345 Reclassification (3,989) 1,111 (3,119) (15) (6,243) (12,255) Transfer to assets held for sale (436) (880) (62) (1,378) Reversal of impairment loss (2,153) (2,153) Disposals (123) (1,742) (531) (2,396) Write off (427) (4,073) (362) (4,862) Exchange difference (421) (2) (37) (460) At 30 June 2008/1 July 2008 Accumulated depreciation 20,930 90, ,122 2, , ,250 Accumulated impairment loss 11,424 11,424 32,354 90, ,122 2, , ,674 Depreciation of the year 3,971 19,110 20, ,173 Reclassification (488) 1, (535) 1,020 Transfer to assets held for sale (362) (362) Reversal of impairment loss 2 2 Disposals (121) (284) (2,528) (168) (39) (3,140) Write off (7,699) (49) (171) (294) (8,213) Exchange difference (38) (34) 7 (8) (73) At 30 June 2009 Accumulated depreciation 23, , ,614 2, , ,655 Accumulated impairment loss 11, ,426 35, , ,616 2, , ,081 Annual Report

90 NOTES TO THE FINANCIAL STATEMENTS 16. Property, Plant and Equipment (Cont d) Furniture, Computer Group **Land fixtures equipment and and Office Motor and building fittings equipment vehicles software Total Carrying amounts RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 At 1 July ,166 20,590 30,396 1,596 45, ,896 At 30 June 2008/1 July ,149 31,118 34,094 1,111 57, ,233 At 30 June ,569 42,141 49, , ,714 ** Land and building Buildings improvements Freehold Freehold and land building renovations Total Cost RM 000 RM 000 RM 000 RM 000 At 1 July ,676 31,535 43,837 84,048 Additions ,133 18,399 Reclassifications 1,831 (9,760) 4,695 (3,234) Disposals (391) (391) Write off (774) (774) Exchange difference 129 (10) 119 Assets held for sale (664) (664) At 30 June 2008/1 July ,507 22,170 64,826 97,503 Additions ,815 10,980 Reclassifications (1,817) (30,259) (32,076) Disposals (16,343) (187) (16,530) Exchange difference (162) 113 (49) Assets held for sale (181) (762) (943) At 30 June ,326 3,251 45,308 58, Annual Report 2009

91 NOTES TO THE FINANCIAL STATEMENTS 16. Property, Plant and Equipment (Cont d) ** Land and building Buildings improvements Freehold Freehold and land building renovations Total Depreciation and impairment loss RM 000 RM 000 RM 000 RM 000 At 1 July 2007 Accumulated depreciation 6,429 15,876 22,305 Accumulated impairment loss 2,153 11,424 13,577 8,582 27,300 35,882 Depreciation for the year 455 3,145 3,600 Reclassification (4,020) 31 (3,989) Reversal of impairment loss (2,153) (2,153) Disposals (123) (123) Write off (427) (427) Assets held for sale (436) (436) At 30 June 2008/1 July 2008 Accumulated depreciation 2,864 18,066 20,930 Accumulated impairment loss 11,424 11,424 2,864 29,490 32,354 Depreciation for the year 346 3,625 3,971 Reclassification (488) (488) Disposals (121) (121) Exchange difference (38) (38) Assets held for sale (362) (362) At 30 June 2009 Accumulated depreciation 2,322 21,570 23,892 Accumulated impairment loss 11,424 11,424 2,322 32,994 35,316 Carrying amounts At 1 July ,676 22,953 16,537 48,166 At 30 June 2008/1 July ,507 19,306 35,336 65,149 At 30 June , ,314 23,569 Annual Report

92 NOTES TO THE FINANCIAL STATEMENTS 16. Property, Plant and Equipment (Cont d) ** Land and building Company Furniture, Office fixtures equipment and Motor and fittings Renovation vehicles computer Total Cost RM 000 RM 000 RM 000 RM 000 RM 000 At 1 July Additions At 30 June 2008/1 July ,186 Additions At 30 June ,242 Depreciation At 1 July 2007 Accumulated depreciation Depreciation of the year At 30 June 2008/ 1 July Depreciation of the year At 30 June Carrying amounts At 1 July At 30 June At 30 June Annual Report 2009

93 NOTES TO THE FINANCIAL STATEMENTS 17. Prepaid Lease Payments Unexpired Unexpired period period less than more than Group 50 years 50 years Total RM 000 RM 000 RM 000 Cost/Valuation At 1 July ,800 23,353 26,153 Exchange difference (196) (196) At 30 June 2008/At 1 July ,604 23,353 25,957 Exchange difference (112) (112) Fair value gain At 30 June ,492 23,473 25,965 Amortisation At 1 July Amortisation Exchange difference (20) (312) (332) At 30 June 2008/At 1 July Amortisation Exchange difference (35) (35) At 30 June ,165 Carrying amounts At 1 July ,523 22,727 25,250 At 30 June 2008/1 July ,347 22,834 25,181 At 30 June ,050 22,750 24,800 Annual Report

94 NOTES TO THE FINANCIAL STATEMENTS 18. General Takaful and Family Takaful Funds Balance Sheet as at 30 June General Family General Family Takaful Takaful Takaful Takaful fund fund Total fund fund Total RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 Assets Property, plant and equipment Investment properties 28, , ,937 43, , ,604 Investments 525,028 2,785,629 3,310, ,104 2,466,908 2,892,012 Investments-linked business 193, , , ,459 Financing receivables 3,478 9,382 12,860 2,024 19,695 21,719 Receivables 74, , ,989 81, , ,788 Assets held for sale Cash and bank balances 8,926 53,258 62,184 40, , , ,607 3,364,426 4,005, ,282 3,100,760 3,693,042 Less: Inter fund balances (57,418) (31,527) 3,947,615 3,661,515 Liabilities Payables 132, , , , , ,689 Provision for outstanding claims 171,405 48, , ,598 49, ,145 Investment-linked business liabilities 14,600 14,600 10,409 10, , , , , , ,243 Less: Inter fund balances (57,418) (31,527) 495, ,716 General Takaful and Family Takaful participants funds 336,967 3,115,374 3,452, ,533 2,911,266 3,197, ,607 3,364,426 3,947, ,282 3,100,760 3,661, Annual Report 2009

95 NOTES TO THE FINANCIAL STATEMENTS 19. Deposits from Customers (i) By type of deposit Group RM 000 RM 000 Non-Mudharabah fund Demand deposits 6,336,054 5,842,720 Savings deposits 2,032,461 1,899,962 Negotiable Islamic Debt Certificates (NIDC) 7,133,790 6,098,744 Others 62,744 41,464 15,565,049 13,882,890 Mudharabah fund Savings deposits 680, ,084 General investment deposits 2,535,289 2,411,039 Special investment deposits 6,090,289 3,720,659 Others ,306,402 6,653,017 24,871,451 20,535,907 (ii) By type of customer Government and statutory bodies 5,233,054 4,566,889 Business enterprises 8,619,680 5,997,473 Individuals 6,805,928 5,173,310 Others 4,212,789 4,798,235 24,871,451 20,535, Deposits and Placements of Banks and Other Financial Institutions Group RM 000 RM 000 Mudharabah Fund: Licensed banks 8,078 58,443 Annual Report

96 NOTES TO THE FINANCIAL STATEMENTS 21. Other Liabilities Group Company Note RM 000 RM 000 RM 000 RM 000 Clients and dealers credit balances 11,562 4,769 Trust account Sundry payables 328, ,533 1, Due to Takaful funds 12,034 Profit equalisation reserve 22 46,369 49,085 Amount due to subsidiaries 6,817 6,875 Others , ,980 8,018 7,239 The amount due to subsidiaries are non-trade, unsecured, not subject to financing charge and has no fixed terms of repayment. 22. Profit Equalisation Reserve ( PER ) Group RM 000 RM 000 At 1 July 49,085 57,402 Recognised in the income statement (2,716) (8,317) At 30 June 46,369 49, Capital and Reserve Group and Company Share capital Number Number Amount of shares Amount of Shares RM RM Authorised: Ordinary shares of RM1 each 2,000,000 2,000,000 2,000,000 2,000,000 One Special Rights Redeemable Preference Share of RM1 * * * * 2,000,000 2,000,000 2,000,000 2,000,000 Issued and fully paid: Ordinary shares of RM1 each On issue at 1 July 891, , , ,390 Issued for cash 175, ,400 On issue at 30 June 1,066,790 1,066, , ,390 * Represents RM1 94 Annual Report 2009

97 NOTES TO THE FINANCIAL STATEMENTS 24. Income Derived from Investment of Depositors Funds Group RM 000 RM 000 Income derived from investment of: (i) General investment deposits 126, ,163 (ii) Other deposits 890, ,945 1,017, ,108 (i) Income derived from investment of general investment deposits Group RM 000 RM 000 Financing income and hibah Financing, advances and others 84,357 79,229 Securities: Held-for-trading Available-for-sale 13,352 6,331 Held-to-maturity Money at call and deposit with financial institutions 21,088 23, , ,729 Amortisation of premium less accretion of discounts 5,368 2, , ,248 Other dealing income Net gain/(loss) from sale of securities held-for-trading 485 (109) Net gain/(loss) on revaluation of securities held-for-trading 715 (26) 126, ,113 Other operating income Net gain from sale of securities available-for-sale Gross dividend income from securities: Quoted in Malaysia , ,163 Annual Report

98 NOTES TO THE FINANCIAL STATEMENTS 24. Income Derived from Investment of Depositors Funds (Cont d) (ii) Income derived from investment of other deposits Group RM 000 RM 000 Financing income and hibah Financing, advances and others 590, ,525 Securities: Held-for-trading 2,673 2,263 Held-to-maturity 3,360 1,869 Available-for-sale 96,630 45,646 Money at call and deposit with financial institutions 150, , , ,536 Amortisation of premium less accretion of discounts 37,208 18, , ,666 Other dealing income Net gain/(loss) from sale of securities held-for-trading 2,719 (781) Net gain/(loss) on revaluation of securities held-for-trading 5,016 (179) 888, ,706 Net gain from sale of securities available-for-sale 1, Gross dividend income from securities: Quoted outside Malaysia 1, , , Income Derived from Investment of Shareholders Funds Group Company RM 000 RM 000 RM 000 RM 000 Financing income and hibah Financing, advances and others 3,256 3,929 2,755 3,681 Securities: Held-for-trading 23 Available-for-sale 45,369 31,675 Held-to-maturity 786 Money at call and deposit with financial institutions 62, ,037 1,385 1, , ,450 4,140 5,000 Amortisation of premium less accretion of discounts 19,528 7, , ,073 4,140 5,000 Other dealing income Net gain from foreign exchange transactions 26,178 9,925 Net loss from sale of securities held-for-trading (108) (6,977) Net gain/(loss) on revaluation of securities held-for-trading 7 (53) Balance brought forward 156, ,968 4,140 5, Annual Report 2009

99 NOTES TO THE FINANCIAL STATEMENTS 25. Income Derived from Investment of Shareholders Funds (Cont d) Group Company RM 000 RM 000 RM 000 RM 000 Balance carried forward 156, ,968 4,140 5,000 Other operating income Net gain from sale of securities available-for-sale 1,914 21,258 1,652 Profit on sale of foreign currencies 1,266 22,741 Unrealised foreign exchange gain on foreign currency cash balances Reversal of allowance for diminution in value of investments Reversal of allowance for doubtful debts 4,500 1,072 Profits from General Takaful and Family Takaful funds attributable to the Group 147, ,613 Gross dividend income from securities: Quoted in Malaysia 301 2, Unit trust in Malaysia 138 1, Unit trust outside Malaysia Unquoted in Malaysia 4,920 3,459 Gross dividend income subsidiary companies 17,571 22,171 Fees and commission 151, , Net gain/(loss) on disposal of property plant and equipment 835 (137) Hibah Rental income 5 2,262 Others 2,286 7, , ,706 21,845 29, Allowance for Losses on Financing Group RM 000 RM 000 Allowance for bad and doubtful financing: Specific allowance Made in the financial year 303, ,924 Written back (133,074) (213,858) Bad debts and financing recovered (44,964) (94,305) Recoverable from Danaharta (2,426) (257) Exchange difference (51) 123,291 (7,547) Annual Report

100 NOTES TO THE FINANCIAL STATEMENTS 27. Impairment Loss Group Company RM 000 RM 000 RM 000 RM 000 Securities: Held-to-maturity (5,994) (12,368) Available-for-sale ,205 (5,894) (2,163) Investment in a subsidiary 6,455 Other receivables 10,557 4,663 (2,163) 6, Income Attributable to Depositors Group RM 000 RM 000 Deposits from customers Mudharabah Fund 176, ,996 Non-Mudharabah Fund 241, ,576 Deposits and placements of banks and other financial institutions Mudharabah Fund 7,491 5, , , Personnel Expenses Group Company RM 000 RM 000 RM 000 RM 000 Salaries and wages 181, ,155 1,219 1,063 Allowance and bonuses 76,861 59, Employees Provident Fund 28,515 27, Directors remuneration 2,167 2,169 1,116 1,402 Others 26,376 27, , ,072 4,325 3, Annual Report 2009

101 NOTES TO THE FINANCIAL STATEMENTS 30. Other Overhead Expenses Group Company RM 000 RM 000 RM 000 RM 000 Promotion 32,811 22, Establishment 164, ,602 General expenses 111, ,377 2,397 2, , ,834 2,563 2,376 Included in other overhead expenses are: Allowance for doubtful debts 11 1,072 Auditors remuneration Audit services Auditors of the Company Other auditors Other services by auditors of the Company Amortisation of prepaid lease payments Depreciation of property, plant and equipment 44,173 47, Impairment loss on assets held for sale 20,038 Rental of properties 32,736 31, Property, plant and equipment written off 22, Rental of equipment 19,930 10, Directors and Shariah Supervisory Council Members Remuneration (a) (i) Aggregate remuneration of Directors of the Company categorised into appropriate components are as follows: Group Company RM 000 RM 000 RM 000 RM 000 Executive Director: Allowances Salaries, bonuses and EPF contributions Benefits-in-kind Non-Executive Directors: Fees and allowances 1,324 1, Total 2,210 2,187 1,159 1,420 Total (excluding benefits-in-kind) 2,167 2,169 1,116 1,402 (ii) Shariah Supervisory Council Annual Report

102 NOTES TO THE FINANCIAL STATEMENTS 31. Directors and Shariah Supervisory Council Members Remuneration (Cont d) (b) (i) The number of Directors of the Company, whose remuneration are paid/payable for their services, fall within the following bands: Group Number of Executive Directors RM100,001 and RM150,000 1 RM750,001 and RM800,000 1 RM850,001 and RM900,000 1 Number of Non-Executive Directors Below RM50, RM50,001 and RM100, RM100,001 and RM150, RM150,001 and RM200, RM250,001 and RM300,000 1 RM400,001 and RM450, Total 9 11 (ii) Number of Shariah Supervisory Council Members Key Management Personnel Key management personnel are defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel include all the Directors of the Group, and certain senior management members of the Group. The compensation for key management personnel other than Director s remuneration is as follows: Group Company RM 000 RM 000 RM 000 RM 000 Other key management personnel: Short-term employee benefits 18,373 17, Benefits in kind ,800 17, Annual Report 2009

103 NOTES TO THE FINANCIAL STATEMENTS 33. Tax Expense (i) Major components of tax expense Group Company RM 000 RM 000 RM 000 RM 000 Current tax expense: Malaysia current year 40,915 14,502 4,210 7,607 prior years 9,156 10,792 (2,364) 50,071 25,294 1,846 7,607 Deferred tax expense: Origination and reversal of temporary differences 71,048 (92,983) (3,093) Over provision in prior year (36,998) 34,050 (92,983) (3,093) 84,121 (67,689) 1,846 4,514 (ii) Reconciliation of effective tax expense Group Company RM 000 RM 000 RM 000 RM 000 Profit before tax 299, ,615 14,957 17,601 Income tax using Malaysia tax rate of 25% (2008: 26%) 74,783 98,700 3,739 4,576 Utilisation of previously unrecognised deferred tax assets (88,791) Recognition of previously unrecognised deferred tax assets 35 (86,312) Non-taxable income (5,388) (13,088) (144) Non-deductible expenses 42,555 10, Other items (22) (8) 111,963 (78,481) 4,210 4,514 Under provision of current tax in prior years 9,156 10,792 (2,364) Overprovision of deferred tax asset (36,998) Tax expense 84,121 (67,689) 1,846 4,514 Annual Report

104 NOTES TO THE FINANCIAL STATEMENTS 34. Earnings Per Share Basic earnings per ordinary share The calculation of basic earnings per ordinary share at 30 June 2009 was based on the profit attributable to ordinary shareholders and the weighted average number of ordinary shares in issue during the year: Group RM 000 RM 000 Profit attributable to ordinary shareholders 113, ,198 Weighted average number of ordinary shares Group RM 000 RM 000 Issued ordinary shares at 1 July 891, ,390 Effect of shares issued on 22 June ,325 Weighted average number of ordinary shares at 30 June 895, ,390 Group Sen Sen Basic earnings per ordinary share Dividends Dividends recognised in the current year by the Company are: Sen Total per share amount Date of payment 2009 (net of tax) RM 000 Final 2008 ordinary , December Final 2007 ordinary ,193 4 January Annual Report 2009

105 NOTES TO THE FINANCIAL STATEMENTS 35. Dividends (Cont d) After the balance sheet date the following dividends were proposed by the Directors. These dividends will be recognised in subsequent financial reports upon approval by the shareholders. Sen per share (net of tax) Total amount RM 000 Final ordinary , Related Party Transactions (i) Identity of related parties For the purposes of these financial statements, parties are considered to be related to the Group if the Group has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the party are subject to common control or common significant influence. Related parties may be individuals or other entities. The Group has a related party relationship with its subsidiaries (see note 14), associate company (see note 15) and holding corporation of the Company. The significant related party transactions of the Group and the Company, other than key management personnel compensation, are as follows: Group Company Transactions Transactions Transactions Transactions amount for amount for amount for amount for RM 000 RM 000 RM 000 RM 000 Subsidiaries Management fees receivables 83 Income receivable attributable on deposits placed 1, Finance cost receivable 2,755 3,337 Hibah receivable 8 Holding corporation Rental of premises payable 1,617 2,236 Brokerage fees receivable 321 Income receivable from financing, advances and others 2,382 3,690 Fees and commission Income payable attributable on deposits placed 31,842 32,227 Annual Report

106 NOTES TO THE FINANCIAL STATEMENTS 36. Related Party Transactions (Cont d) Group Company Net balance Net balance Net balance Net balance outstanding outstanding outstanding outstanding as at 30 June as at 30 June as at 30 June as at 30 June RM 000 RM 000 RM 000 RM 000 Subsidiaries Amounts due from Current account and investment deposits 186,469 46,490 Subordinated financing 100, ,000 Others Amounts due to Financing, advances and others 6,817 6,836 Holding corporation Amount due from Financing, advances and others 112,863 86,385 Amount due to Current account and investment deposits 1,480,978 1,518,456 (ii) Related party transactions A Director is authorised to trade, under his own discretion, though a trading account co-owned by the Director and a subsidiary. Under the arrangement, any trading loss is borne by the Director, whereas any gain is equally shared by the Director and the subsidiary. Transactions entered into through this trading account are as follows:- Group RM 000 RM 000 Sales of securities 4,887 2,687 Purchase of securities 4,171 3, Annual Report 2009

107 NOTES TO THE FINANCIAL STATEMENTS 37. Capital Adequacy The Risk Weighted Capital Ratio ( RWCR ) computation consists of the capital adequacy ratios of Bank Islam Malaysia Berhad ( Bank Islam ) and its subsidiaries. Effective January 2008, all Islamic Banks licensed under the Islamic Banking Act (IBA) 1983 are required to compute the RWCR in accordance with the Capital Adequacy Framework for Islamic Banks (CAFIB). Under CAFIB, Islamic Banks are required to comply both on an entity as well as on a consolidated basis (inclusive of subsidiary entities, and overseas financial subsidiaries). Hence with effect from 1 January 2008, Bank Islam s RWCR computation is computed according to CAFIB, with the adoption of the Standardized Approach (SA) for Credit Risk and Market Risk, and the Basic indicator Approach (BIA) for Operational Risk. The Company is not required to maintain any capital adequacy ratios. The Risk Weighted Capital Ratio (RWCR) of Bank Islam Malaysia Berhad and its subsidiaries as at 30 June 2009 are as follows: (a) The capital adequacy ratios of Bank Islam Malaysia Berhad and its subsidiaries as at 30 June 2009: RM 000 RM 000 Before proposed dividend Core capital ratio 12.25% 11.27% Risk-weighted capital ratio 13.87% 13.15% After proposed dividend Core capital ratio net 12.25% 11.27% Risk weighted capital ratio 13.87% 13.15% (b) Tier I and Tier II capital components of Bank Islam Malaysia Berhad and its subsidiaries as at 30 June 2009: RM 000 RM 000 Tier I capital Paid-up share capital 1,725,490 1,725,490 Share premium 500, ,020 Accumulated losses (1,309,362) (1,390,935) Other reserves 589, ,821 Less: Deferred tax assets (61,660) (86,282) Total Tier I capital 1,443,612 1,257,114 Annual Report

108 NOTES TO THE FINANCIAL STATEMENTS 37. Capital Adequacy (Cont d) (b) Tier I and Tier II capital components of Bank Islam Malaysia Berhad and its subsidiaries as at 30 June 2009: (Cont d) RM 000 RM 000 Tier II capital Redeemable Subordinated Mudharabah 20,000 40,000 General allowance for bad and doubtful financing 170, ,382 Total Tier II capital 190, ,382 Total capital 1,634,456 1,466,496 Less: Investment in subsidiaries Capital base 1,634,456 1,466, Financial Risk Management Policies Operational risk This risk is defined as the risk of loss arising from inadequate or failed internal processes, people and systems and external events. In managing this risk a dedicated team has been established. The team is responsible for identification, assessment and measurement, control framework, monitoring and reporting of operational risks. Credit risk Credit risk is the potential loss of revenue and principal in the form of specific allowances as a result of defaults by the customers or counter parties through the financing, dealing and investing activities. The primary exposure to credit risk arises from financing activities. Credit policy to govern the activities is rigorously being enhanced with the objectives of improving and preserving the quality of assets originated. This is in line with the on-going organisation transformation. Under the credit process flow, credit administration, credit control, review and analysis are performed independently of individuals involved in business origination. In addition, an independent evaluation of credit proposal before approval has been established for all proposal involving corporate and commercial. This function is performed by the risk management division. Credit risk arising from dealing and investing activities are managed by the establishment of limits which includes counter parties limits and permissible acquisition of not less than A-rated private entities instruments. Furthermore, the dealing and investing activities are monitored by an independent middle office unit. 106 Annual Report 2009

109 NOTES TO THE FINANCIAL STATEMENTS 38. Financial Risk Management Policies (Cont d) Underwriting risk Underwriting risk includes the risk of incurring higher claims costs than expected owing to the random nature of claims and their frequency and severity and the risk of change in legal or economic conditions or behavioural patterns affecting takaful pricing and conditions of takaful or retakaful cover. This may result in the situation of having either received too little contribution for the risk it has agreed to underwrite and hence has not enough funds to invest and pay claims, or claims are in excess of those expected. The Group seeks to minimise underwriting risks with a balance mix and spread of business between classes of business and by observing underwriting guidelines and limits, conservative estimation of the claims provisions and high standards applied to security at retakaful. Market risk Market risk is the risk of loss arising from the adverse movement in the level of market prices or rates. The market risk components are foreign exchange risk, profit rate risk and equity risk. (i) (ii) Foreign exchange risk This risk refers to the adverse exchange rate movements on foreign currency positions taken by the Group. Foreign currency open position is monitored against predetermined position limits and cut-loss limits. Profit rate risk This risk refers to volatility in the net profit income as a result of changes in the levels of profit rate and shift in the composition of the assets and liabilities. The profit rate risk, however, is self-mitigated when most of the financing assets are based on fixed rate while profit paid to depositors are not contractual. Profit paid to depositors/investors depends on the profit generated from the Bank s activities and the profit sharing distribution. The Group is not exposed directly to interest rate risk because interest is prohibited under Islamic banking. The indirect interest rate risk exists arising from competition with other banks. This is managed by regularly reviewing the Bank profit rates. (iii) Equity risk Equity risk refers to the adverse movements in the price of equities on equity positions. Equity position is marked to market and monitored by the Risk Management Division and reported to the Risk Management Committee of each of the respective operating subsidiaries. Liquidity risk Liquidity risk is related to the risk arising mainly from withdrawals of deposits. In managing this, the Group is adopting the liquidity framework introduced by Bank Negara Malaysia which ascertain liquidity based on the contractual and behavioural cash flow of assets, liabilities and off-balance sheet commitments. Annual Report

110 NOTES TO THE FINANCIAL STATEMENTS 39. Profit Rate Risk The Group is exposed to various risks associated with the effects of fluctuations in the prevailing levels of market profit rates on its financial position and cash flows. The assets and liabilities at carrying amount are categorised by the earlier contractual repricing or maturity dates. Effective Up to 1 > 1-3 > Over 5 Non profit Trading profit As at 30 June 2009 month months months years years sensitive book Total rate RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 % Assets Cash and short-term funds and deposits and placements with banks and other financial institutions 7,832,332 41,393 45,125 4, ,112 8,573, Securities Held-for-trading 294, , Held-to-maturity 7, , , Available-for-sale 344,491 1,080,040 1,145,863 3,322,879 2,656,633 85,406 8,635, Financing, advances and others Performing 711, , ,284 2,116,720 4,939,012 9,179, Non-performing 482, ,154 Other assets 4,570,275 4,570,275 8,888,482 1,997,228 1,735,272 5,598,766 7,595,645 5,787, ,868 31,898,208 Liabilities Deposits from customers 9,424,893 2,797,708 2,015,425 1,511,812 9,121,613 24,871, Deposits and placements of banks and other financial institutions 8,078 8, Bills and acceptance payable 283, , Other liabilities 4,368,573 4,368,573 Total liabilities 9,716,183 2,797,708 2,015,425 1,511,812 13,490,186 29,531,314 Shareholders equity 2,366,894 2,366,894 Total liabilities and shareholders equity 9,716,183 2,797,708 2,015,425 1,511,812 15,857,080 31,898,208 On-balance sheet profit sensitivity gap (827,701) (800,480) (280,153) 4,086,954 7,595,645 Off-balance sheet profit sensitivity gap Net maturity mismatch (827,701) (800,480) (280,153) 4,086,954 7,595, Annual Report 2009

111 NOTES TO THE FINANCIAL STATEMENTS Effective Up to 1 > 1-3 > Over 5 Non profit Trading profit As at 30 June 2008 month months months years years sensitive book Total rate RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 % Assets Cash and short-term funds and deposits and placements with banks and other financial institutions 9,485,426 2,517 44,572 5, , ,454 10,194, Securities Held-for-trading 9,883 80,866 90, Held-to-maturity 93,207 68, , Available-for-sale 92, , ,709 1,303,217 1,297,500 27,631 3,481, Financing, advances and others Performing 1,336, , ,378 1,650,931 3,855,591 8,333, Non-performing 721, ,773 Other assets 4,598,754 4,598,754 10,914, ,036 1,304,659 3,053,144 5,221,418 5,787, ,320 27,582,097 Liabilities Deposits from customers 5,071,439 3,012,565 2,161,545 1,682, ,080 8,063,127 20,535, Deposits and placements of banks and other financial institutions 58,443 58, Bills and acceptance payable 990, , Other liabilities 4,057,980 4,057,980 Total liabilities 6,120,330 3,012,565 2,161,545 1,682, ,080 12,121,107 25,642,778 Shareholders equity 1,939,319 1,939,319 Total liabilities and shareholders equity 6,120,330 3,012,565 2,161,545 1,682, ,080 14,060,426 27,582,097 On-balance sheet profit sensitivity gap 4,793,686 (2,018,529) (856,886) 1,370,993 4,676,338 Off-balance sheet profit sensitivity gap Net maturity mismatch 4,793,686 (2,018,529) (856,886) 1,370,993 4,676,338 Annual Report

112 NOTES TO THE FINANCIAL STATEMENTS 40. Fair Value of Financial Assets and Liabilities Financial instruments comprise financial assets, financial liabilities and off-balance sheet instruments. Fair value is the amount at which the financial assets could be exchanged or a financial liability settled, between knowledgeable and willing parties in an arm s length transaction. The information presented herein represents the estimates of fair values as at the balance sheet date. Where available, quoted and observable market prices are used as the measure of fair values. Where such quoted and observable market prices are not available, fair values are estimated based on a range of methodologies and assumptions regarding risk characteristics of various financial instruments, discount rates, estimates of future cash flows and other factors. Changes in assumptions could materially affect these estimates and resulting fair value estimates. Fair value information for non-financial assets and liabilities are excluded as they do not fall within the scope of FRS , Financial Instruments: Disclosure and Presentation which requires the fair value information to be disclosed. The following table summarises the carrying and fair values of the financial assets and liabilities on the balance sheet date: Carrying value Fair value Group RM 000 RM 000 RM 000 RM 000 Financial assets Cash and short-term funds 8,482,444 9,947,185 8,482,444 9,947,185 Deposits and placements with banks and other financial institutions 90, ,036 90, ,036 Securities Held-for-trading 294,868 90, ,868 90,749 Held-to-maturity 162, , , ,534 Available-for-sale 8,635,312 3,481,811 8,635,312 3,481,811 Financing, advances and others 9,661,864 9,055,028 9,832,708 9,225,154 Financial liabilities Deposits from customers 24,871,451 20,535,907 24,871,451 20,535,907 Deposits and placements of banks and other financial institutions 8,078 58,443 8,078 58,443 Bills and acceptance payable 283, , , , Annual Report 2009

113 NOTES TO THE FINANCIAL STATEMENTS 40. Fair Value of Financial Assets and Liabilities (Cont d) Carrying value Fair value Company RM 000 RM 000 RM 000 RM 000 Financial assets Cash and short-term funds 224,701 46, ,701 46,485 Securities Available-for-sale 12,187 11,807 12,187 11,807 Financing, advances and others 100, , , ,000 The fair value of the Group s financial instruments which include cash and short-term funds, deposits and placements with banks and other financial institutions and short-term borrowings are not materially sensitive to shifts in market profit rate because of the limited term to maturity of these instruments. As such, the carrying value of these financial assets and liabilities at balance sheet date approximate their fair values. The fair values are based on the following methodologies and assumptions: Deposits and placements with banks and other financial institutions For deposits and placements with financial instruments with maturities of less than six months, the carrying value is a reasonable estimate of fair values. For deposits and placements with maturities six months and above, the estimated fair values are based on discounted cash flows using prevailing money market profit rates at which similar deposits and placements would be made with financial instruments of similar credit risk and remaining period to maturity. Securities held-for-trading and securities available-for-sale The estimated fair values are generally based on quoted and observable market prices. Where there is no ready market in certain securities, fair values have been estimated by reference to market indicative yields or net tangible asset backing of the investee. Financing, advances and others Their fair value is estimated by discounting the estimated future cash flows using the prevailing market rates of financings with similar credit risks and maturities. The fair values are represented by their carrying value, net of specific allowance and income-in-suspense, being the recoverable amount. Deposits from customers For deposits from customers with maturities of less than six months, the carrying amounts are a reasonable estimate for their fair values. For deposits with maturities of six months or more, the fair values are estimated using discounted cash flows based on prevailing market rates for similar deposits from customers. Annual Report

114 NOTES TO THE FINANCIAL STATEMENTS 40. Fair Value of Financial Assets and Liabilities (Cont d) Deposits and placements of banks and other financial institutions The estimated fair values of deposits and placements of banks and other financial institutions with maturities of less than six months approximate the carrying values. For deposits and placements with maturities of six months or more, the fair values are estimated based on discounted cash flows using prevailing money market profit rates for deposits and placements with similar remaining period to maturities. Bills and acceptance payable The estimated fair values of bills and acceptance payables with maturity of less than six months approximate their carrying values. For bills and acceptance payable with maturities of six months or more, the fair values are estimated based on discounted cash flows using prevailing market rates for borrowings with similar risks profile. 41. Capital Commitments Group RM 000 RM 000 Property, plant and equipment Contracted but not provided for in the financial statements 119, ,850 Approved but not contracted for and not provided for in the financial statements 39, , , Contingent Liability Prior to the amendments of Section 60AA of the Income Tax Act 1967 (Section 60AA), capital allowances had been claimed by way of deduction from tax adjusted income in both General and Family Takaful Funds whilst the Shareholders Fund is not entitled to claim capital allowances. The amended Section 60AA stipulates that the tax adjusted income of the Shareholders Fund shall be ascertained by taking into account the amount of income distributed or credited from Family and General Takaful Funds and as a result both General and Family Takaful Funds would have nil tax adjusted income. As such, capital allowances claimable for the years of assessment from 1997 to 2008 would be carried forward indefinitely as the operator s share of profits from the Family and General Fund will be taxed in the Shareholders Fund. The Group s Takaful subsidiary has presented the issue on non-deductibility of capital allowances to the Ministry of Finance (MOF) on 30 March The MOF has agreed to review the tax issue and thereafter, will advise the Group accordingly. No provision has been made by the Group for the potential tax liabilities on non-deductibility of capital allowances for the previous and current years pending the outcome of the said review. The potential tax exposure to the Group assuming that the deduction of capital allowances in Shareholders Fund is rejected by the MOF is approximately RM18.2 million. In addition, the Group would have to reverse its current balance of deferred tax asset which is in relation to unabsorbed capital allowances brought forward by approximately RM5.6 million. 112 Annual Report 2009

115 NOTES TO THE FINANCIAL STATEMENTS 43. Segmental Information The inter-segment transactions have been entered into in the normal course of business and have been established under negotiated terms. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items mainly comprise corporate assets and expenses. The Group operates predominantly in Malaysia and accordingly, information by geographical location on the Group s operation is not presented. Segment information is presented in respect of the Group s main business segment. Business segments The Group comprises of the following main business segments: Banking Takaful Others Islamic banking and provision of related services. Underwriting of family and general Islamic insurance ( Takaful ). Investment holding, currency trading, ijarah financing, stockbroking. Banking Offshore Domestic Takaful Others Elimination Consolidated 2009 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 Business segments Revenue from external customers 12,661 1,254, ,530 11,872 1,490,180 Inter-segment revenue 7,919 2,349 35,504 (45,772) Total revenue 12,661 1,262, ,879 47,376 (45,772) 1,490,180 Segment result Operating profit (30,135) 268,756 49,715 33,417 (22,621) 299,132 Zakat (7,303) Tax expense (84,121) Profit for the year 207,708 Business segments Segment assets 50,076 27,438,431 4,372,235 1,847,656 (1,810,339) 31,898,059 Investment in associates Total assets 50,076 27,438,431 4,372,235 1,847,805 (1,810,339) 31,898,208 Segment liabilities 375,131 25,582,194 3,994,790 24,137 (444,938) 29,531,314 Capital expenditure 52,122 4, ,225 Depreciation 53 32,759 10, ,173 Annual Report

116 NOTES TO THE FINANCIAL STATEMENTS 43. Segmental Information (Cont d) Banking Offshore Domestic Takaful Others Elimination Consolidated 2008 RM 000 RM 000 RM 000 RM 000 RM 000 RM 000 Business segments Revenue from external customers 26,125 1,150, ,610 12,075 1,426,814 Inter-segment revenue 3,216 2,648 38,765 (44,629) Total revenue 26,125 1,153, ,258 50,840 (44,629) 1,426,814 Segment result Operating profit 20, ,682 35,748 23, ,615 Zakat (13,522) Tax expense 67,689 Profit for the year 433,782 Business segments Segment assets 525,714 23,030,729 4,045,137 1,676,758 (1,696,390) 27,581,948 Investment in associate Total assets 525,714 23,030,729 4,045,137 1,676,907 (1,696,390) 27,582,097 Segment liabilities 1,125,972 21,111,202 3,711,264 32,306 (337,966) 25,642,778 Capital expenditure 29 82,002 15,564 1,236 98,831 Depreciation 97 21,912 17,716 7,620 47, Annual Report 2009

117 NOTES TO THE FINANCIAL STATEMENTS 44. Commitments and Contingencies In the normal course of business, the Group makes various commitments and incur certain contingent liabilities with legal recourse to their customers. No material losses are anticipated as a result of these transactions. Group RM 000 RM 000 Credit-related Exposures Direct credit substitutes 615, ,235 Assets sold with recourse 6,220 11,438 Transaction related contingent items 702, ,905 Other commitments, such as formal standby facilities and credit lines, with an original maturity of over one year 333, ,785 Short term self liquidating trade related contingencies 390, ,410 Other commitments, such as formal standby facilities and credit lines, with an original maturity of up to one year 238 8,856 Unutilized credit card lines 908, ,628 Any commitments that are unconditionally cancelled at any time by the bank without prior notice or that effectively provide for automatic cancellation due to deterioration in a borrower s creditworthiness 3,035,041 3,594,123 5,992,736 6,205,380 Derivative Financial Instruments Foreign exchange related contracts 1,455,651 2,892,916 Profit rate related contracts 194, ,228 1,650,642 3,034,144 Obligations under an on-going underwriting agreement 50, ,000 7,693,378 9,342, Subsequent Event After the Financial year Subscription of million Islamic Convertible Redeemable Non-cumulative Preference Shares (CRNCPS) The Company has on 1 July 2009 subscribed for its entitlement of million CRNCPS issued by a subsidiary, Bank Islam Malaysia Berhad. Annual Report

118 Statement by Directors pursuant to Section 169(15) of the Companies Act, 1965 In the opinion of the Directors, the financial statements set out on pages 54 to 115 are drawn up in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia as modified by Bank Negara Malaysia Guidelines so as to give a true and fair view of the financial position of the Group and of the Company as of 30 June 2009 and of their financial performance and cash flows for the year then ended. Signed on behalf of the Board of Directors in accordance with a resolution of the Directors: Tan Sri Samsudin bin Osman Johan bin Abdullah Kuala Lumpur, 26 October Annual Report 2009

119 Statutory Declaration pursuant to Section 169(16) of the Companies Act, 1965 I, Mohamad Azlan bin Mohamad Alam, the officer primarily responsible for the financial management of BIMB Holdings Berhad, do solemnly and sincerely declare that the financial statements set out on pages 54 to 115 are, to the best of my knowledge and belief, correct and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, Subscribed and solemnly declared by the above named in Kuala Lumpur on 26 October 2009 Mohamad Azlan bin Mohamad Alam Before me: Annual Report

120 Independent Auditors Report to the Members of BIMB Holdings Berhad We have audited the financial statements of BIMB Holdings Berhad, which comprise the balance sheets as at 30 June 2009 of the Group and of the Company, and the income statements, statements of changes in equity and cash flow statements of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 54 to 115. Directors Responsibility for the Financial Statements The Directors of the Company are responsible for the preparation and fair presentation of these financial statements in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as of 30 June 2009 and of their financial performance and cash flows for the year then ended. 118 Annual Report 2009

121 INDEPENDENT AUDITORS REPORT to the Members of BIMB Holdings Berhad Report on Other Legal and Regulatory Requirements In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following: (a) (b) (c) (d) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act. We have considered the accounts and the auditors reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note 14 to the financial statements. We are satisfied that the accounts of the subsidiaries that have been consolidated with the Company s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes. The audit reports on the accounts of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act. Other Matters This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report. KPMG Desa Megat & Co. Firm Number: AF 0759 Chartered Accountants Adrian Lee Lye Wang Approval Number: 2679/11/09(J) Chartered Accountant Petaling Jaya, 26 October 2009 Annual Report

122 Properties Owned by the BHB Group Properties owned by Bank Islam No. Location Description of Existing Use 1. HS (D) PT 45 Seksyen 87 Jalan Tun Razak Bandar Kuala Lumpur Building site Tenure Leasehold for 99 years expiring on Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement NA 6,597 13,745, NA 2. No PT 1708 & 1709 HS (M) 2660 & 2661 Batu 5 1 / 2 Jalan Cheras Kuala Lumpur Vacant land Leasehold for 99 years expiring on NA 4,443 68, NA 3. Lot No PT HSD 1323 Mukim Nakhoda Omar Sabak Bernam, Selangor Vacant land Leasehold for 99 years expiring on NA 405, , NA Properties owned by Syarikat Al-Ijarah Sdn Bhd 1. No. P.T. Lot & H.S.(D) 815 & 816, Lot No. 71 & 73, Jalan Taman Selat Off, Jalan Bagan Luar, Butterworth 4-storey shophouse for Bank Islam Operation Freehold & 273 1,046, NA 120 Annual Report 2009

123 PROPERTIES OWNED BY THE BHB GROUP Properties owned by Syarikat Takaful Malaysia Berhad No. Location Description of Existing Use Tenure 1. Lot 557 & 559 Plaza Melaka Jalan Hang Tuah Melaka Two units of 4 1 / 2 storey Shophouse/ Office Age of Building (years) Land, Build-up Area (square feet) Freehold 26 3,485/ 14,434 Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 1,471, Lot 1 & 2 Kompleks Perniagaan Fajar Tawau Sabah Three units of 4 storey commercial Complex/ Office 999 years town lease expiring on ,025/ 6,037 2,235, No. 64 & 65 Kompleks Jitra Jalan Sungai Korok Jitra Kedah Darul Aman Two units of 2 storey Shophouse/ Office Freehold 23 3,095/ 6, , No. 23 Medan Istana 3 Bandar Ipoh Raya Ipoh Perak Darul Ridzuan One unit of 3 storey Shophouse/ Office 99 years lease expiring on ,539/ 4, , No. 84 Batu 3 1 / 4 Jalan Gombak Kuala Lumpur One unit of 5 storey Shophouse/ Office Freehold 23 1,883/ 8, , Lot 6966, Blok 59 Muara Tuang Jalan Datok Mohd Musa Kota Samarahan Sarawak One unit of 3 storey Shophouse/ Office 60 years lease expiring on ,312/ 3, , Annual Report

124 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use Tenure Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 7. Lot 54 & 55 Bandar Wilayah Jasa Jalan Bunga Raya Lahad Datu Sabah Two units of 3 storey Shophouse/ Office 99 years town lease expiring on ,400/ 7,200 1,302, Lot Lot No. 24 Jalan USJ 10/1B Subang Jaya Selangor Darul Ehsan One unit of 3 storey Shophouse/ Office Freehold 15 3,200/ 9,600 3,514, No. 15 & 17 Jalan Kelibang Langkawi Mall Kuah, Langkawi Kedah Darul Aman Two units of 2 storey Shophouse/ Office Freehold 16 1,440/ 7, , No. 26 & 28 Jalan Perda Barat Bukit Mertajam Seberang Prai Penang Two units of 3 storey Shophouse/ Office Freehold 11 3,293/ 8,840 1,000, Lot 2, 3 & 4 Jalan Kulas Kuching Sarawak Three units of 3 storey Shophouse/ Office Freehold 14 4,817/ 18,892 4,751, No. 14 & 16 Jalan Ibrahim Kota Tinggi Johor Darul Ta zim Two units of 3 storey Shophouse/ Office 99 years lease Lot 14 expiring on Lot 16 expiring on ,360/ 8, , Annual Report 2009

125 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use 13. No. 312 Jalan Bandar 13 Taman Melawati Kuala Lumpur One unit of 4 storey Shophouse/ Office Tenure Age of Building (years) Land, Build-up Area (square feet) Freehold 15 1,920/ 7,070 Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 1,245, Lot 9046, Fasa 1A Jalan Haji Manan Kluang Johor Darul Ta zim One unit of 4 storey Shophouse/ Office 99 years lease 13 2,658/ 9,930 1,750, No D Leboh Bishop Pulau Pinang One unit of 6 storey Office building (9 level) Freehold 32 3,972/ 19,630 4,000, Lot 13 & 14 Lazenda Commercial Centre Jalan Okk Abdullah Labuan Two units of 3 storey Office building 999 years lease expiring on ,504/ 7,200 1,689, Lot Lot Lot 6967, Blok 59 Muara Tuang Jalan Datok Mohd Musa, Kota Samarahan Sarawak One unit of 3 storey Shophouse/ Office 60 years lease expiring on ,312/ 3, , Lot 28, 30 & 32 Jalan 2/3A, Pasar Borong Selayang Selangor Darul Ehsan Three units of 4 storey Shophouse/ Office 99 years lease expiring on ,447/ 16,800 2,040,000 Lot 28 & Lot Lot 28 & Lot Annual Report

126 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use Tenure Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 19. Lot Level 1 & Mezzanine Jalan Bukit Timbalan Johor Bharu Johor Darul Ta zim Two floors of 13 storey Office building 99 years lease expiring on ,432/ 8,206 2,820, Lot Level 3, Jalan Bukit Timbalan Johor Bharu Johor Darul Ta zim One floor of 13 storey Office building 99 years lease expiring on ,432/ 6,594 1,650, Lot 14(S1) & 15(S1) Indah Point, Section 12 Pulau Indah Industrial Park Klang, West Port Selangor Darul Ehsan Two units of 4 storey Shophouse/ Office (vacant) 99 years lease expiring on ,300/ 10, , No. 1 & 2 Jalan Kelicap Taman Pekan Baru Parit Buntar Perak Darul Ridzuan Two units of 2 storey Shophouse/ Office 99 years lease expiring on ,956/ 7, , No. 46 & 47, Darul Takaful Jalan Rahmat Batu Pahat Johor Darul Ta zim Two units of 4 Storey Shophouse/ Office Freehold 20 3,220/ 12,092 1,400, No. 180 & 181 Jalan Tuan Hitam Jerteh Terengganu Darul Iman Two units of 4 storey Shophouse/ Office Freehold 19 3,200/ 12,250 1,430, Annual Report 2009

127 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use 25. Lot 82, 84 & 86 Jalan Rugbi 13/30 Seksyen Shah Alam Selangor Darul Ehsan Three units of 2 storey Shophouse/ Office Tenure Age of Building (years) Land, Build-up Area (square feet) Freehold 10 6,339/ 11,309 Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 2,240, No. 229 Jalan Shahab 2 Shahab Perdana Jalan Sultanah Sambungan Alor Star Kedah Darul Aman One unit of 2 1 / 2 storey Shophouse/ Office Freehold 13 1,400/ 3, , Lot No Jalan Dato Ulu Muar Kuala Pilah Negeri Sembilan Darul Khusus One unit of 3 storey Shophouse/ Office 99 years lease expiring on ,001/ 3, , No. 45 Jalan Teluk Sisek Kuantan Pahang Darul Makmur One unit of 4 storey Shophouse/ Office 99 years lease expiring on ,200/ ,000, Lot. 21, 22, & 23 Pusat Komersil Temerloh Temerloh Pahang Darul Makmur Three units of 2 1/ 2 storey Shophouse/ Office 99 years lease expiring on ,195/ 15,050 1,320, Annual Report

128 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use Tenure Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 30. No. 2 & 4 Jalan 6C/ Bandar Baru Bangi Selangor Darul Ehsan Two units of 2 storey Shophouse/ Office 99 years lease expiring on ,383/ 8,032 1,500, Lot 14 Arab Malaysian Business Centre Jalan Pasar Seremban Negeri Sembilan Darul Khusus One unit of 6 storey Shophouse/ Office Freehold 13 14,589/ 1,500 3,375, Tingkat Bawah & Mezzanine Wisma Abrar International Lot 54, Seksyen Kota Bharu Kelantan Darul Naim One floor of 8 1 / 2 storey Office building Freehold 12 18,775/ 1,744 3,700, No. 29, Jalan Delima Pusat Perdagangan Pontian Pontian Johor Darul Ta zim One unit of 3 storey Shophouse/ Office 99 years lease expiring on ,899/ 10,248 1,250, Lot 11 & 12 Kompleks Seri Temin Jalan Ibrahim Sungai Petani Kedah Darul Aman Two units of 4 storey Shophouse/ Office 99 years lease expiring on ,800/ 11,020 1,300, Annual Report 2009

129 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use Tenure Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 35. Lot 1129 & 1130 Bangunan Darul Takaful Jalan Sultan Ismail Kuala Terengganu Terengganu Darul Iman One unit of 12 storey Office building 45 years sub lease expiring on ,600/ 28,937 6,600, No. 616 & 617 Jalan Besar Bandar Tampin Negeri Sembilan Darul Khusus Two units of 2 storey Office building 99 year lease expiring on ,498/ 8, , No. 6, Jalan 6C/ Bandar Baru Bangi Selangor Darul Ehsan One unit of 2 storey Shophouse/ Office 99 year lease expiring on ,905/ 3, , Unit 3B/G Tingkat Bawah Blok 3B Plaza Sentral Jalan Stesen Sentral Kuala Lumpur One floor of 22 storey Office building Freehold 8 6,409 6,000, No. 26 & 27 Jalan Tanjung Pasar Baru Machang Kelantan Darul Naim Two units of 2 storey Office building 99 years lease expiring on ,600/ 4, , Annual Report

130 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use Tenure Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 40. No. 330 & 331 Jalan Sultan Yahya Petra Kota Bharu Kelantan Darul Naim Two units of 4 1 / 2 storey Office building 99 years lease expiring on ,200/ 15,200 1,700, Dataran Kewangan Darul Takaful Jalan Sultan Sulaiman Kuala Lumpur Two units of Office building Main Block - 26 storey Annex Block - 29 storey Freehold Main Block - 36 Annex Block ,427/ 393, ,000, No Taman Samudera Sri Manjung Perak Darul Ridzuan One unit of 2 storey Shophouse/ Office 99 years lease expiring on ,800/ 5, , No. 76A & 76 Pusat Perniagaan Jalan Tupai Taiping Perak Darul Ridzuan Two units of 3 storey Office building Freehold 6 3,134/ 18,304 1,530, No. 10 & 11 Jalan Sultan Yahya Petra Kota Bharu Kelantan Darul Naim Two units of 3 storey Office building 33 years lease expiring on ,852/ 9,120 1,800, No Jalan Teluk Wanjah Alor Star Kedah Darul Aman One unit of 4 storey Office building Freehold 7 8,716/ 18,440 3,700, Annual Report 2009

131 PROPERTIES OWNED BY THE BHB GROUP No. Location Description of Existing Use Tenure Age of Building (years) Land, Build-up Area (square feet) Net Book Value as at (RM) Date of Aquisition Date of Sale and Purchase Agreement 46. No. 10 & 8, Jalan Padi Emas 5/2 Bandar Baru UDA Johor Bharu Johor Two unit of 3 storey Office building 99 years leasehold 4 3,080/ 8,024 1,300, No. 4 Kompleks Seri Temin Jalan Ibrahim Sungai Petani Kedah One unit of 4 storey Office building 99 years lease expiring on ,400/ 5, , No. 16 Jalan Cenderawasih Jalan Kilang Lama Kulim Kedah One unit of 3 storey Office building Freehold 10 1,600/ 4, , No. 6 Jalan Padi Emas 5/2 Bandar Baru UDA Johor Bharu Johor One unit of 3 storey Office building 99 years leasehold 4 1,540/ 4, , No. 148, Kompleks Munshi Abdullah Melaka One unit of 4 1 / 2 storey Office building 99 years leasehold 16 1,470/ 6, , No & Pusat Perniagaan Inderapura Jalan Tras Raub, Pahang Two unit of 3 storey Office building 99 years lease expiring on ,218/ 9,280 1,300, Annual Report

132 Shareholding Statistics Authorised Share Capital : RM2,000,000,000 Paid-Up Capital : RM1,066,789,896 Class of Share : Ordinary Share of RM1.00 each Voting Rights : One (1) Vote Per Ordinary Share Analysis by Size of Shareholdings As at 30 September 2009 Size of shareholdings No. of Shareholders % of Shareholders No. of Shares Held % of Shareholdings Less than , ,000 1, , ,001 10,000 4, ,493, , ,000 1, ,836, ,001 And Above ,566, % and above ,998, Total 6, ,066,789, List of Directors Shareholdings As at 30 September 2009 No. Names Shareholdings % 1. Tan Sri Samsudin Osman 2. Encik Johan Bin Abdullah 3. Dato Mohd Bakke Bin Salleh 4. Datuk Ismee Bin Ismail 5. Dato Dr. Abdul Halim Bin Haji Ismail 1, Encik Mohd Zin Bin Idris 7. Encik Salih Amaran Bin Jamiaan 8. Puan Zaiton Bin Mohd Hassan 9. Dato Hairuddin Bin Mohamed 130 Annual Report 2009

133 SHAREHOLDING STATISTICS List of Substantial Shareholdings (5% and above) As at 30 September 2009 No. Names Shareholdings % 1. Lembaga Tabung Haji 549,067, Amanah Saham Bumiputera 154,000, Permodalan Nasional Berhad 61,931, Bumiputera Shareholdings Breakdown As at 30 September 2009 No. Types of Ownership No. of Shareholders % No. of Shares % 1. Government Agency ,419, Bumiputera a) Individuals 1, ,349, b) Companies ,545, c) Nominees Company ,117, Non-Bumiputera a) Individuals 3, ,854, b) Companies ,979, c) Nominees Company ,207, Malaysian Total 6, ,055,474, Foreign a) Individuals ,519, b) Companies , c) Nominees Company ,701, Foreign Total ,315, Grand Total 6, ,066,789, Annual Report

134 SHAREHOLDING STATISTICS List of Top Thirty (30) Shareholders As at 30 September 2009 No. Names Shareholdings % 1. Lembaga Tabung Haji 549,067, Amanah Raya Nominees (Tempatan) Sdn Bhd A/C Skim Amanah Saham Bumiputera 154,000, Permodalan Nasional Berhad 61,931, Employees Provident Fund Board 50,478, Lembaga Tabung Angkatan Tentera 41,579, Felda Holdings Bhd 24,947, Majlis Agama Islam Dan Adat Melayu Terengganu 10,405, Mayban Securities Nominees (Tempatan) Sdn Bhd A/C Majlis Ugama Islam Sabah 10,318, Majlis Ugama Islam Sabah 9,178, Amin Baitulmal Johor 8,316, Majlis Agama Islam Selangor 5,873, Majlis Agama Islam Negeri Pulau Pinang 5,544, Majlis Amanah Rakyat 5,544, Affin Nominees (Tempatan) Sdn Bhd A/C Majlis Ugama Islam Dan Adat Resam Melayu Pahang 5,544, Majlis Ugama Islam Negeri Sembilan 5,100, Majlis Agama Islam Dan Adat Istiadat Melayu Kelantan 4,532, Tabung Warisan Negeri Selangor 4,500, Harakah Islamiah (HIKMAH) 3,056, Warisan Harta Sabah Sdn Bhd 2,865, Yayasan Kelantan Darulnaim 2,412, Pertubuhan Kebajikan Islam Malaysia (PERKIM) 2,242, Citigroup Niminees (Asing) Sdn Bhd CBNY For DFA Emerging Markets Fund 2,170, Pertubuhan Kebajikan Islam Malaysia (PERKIM) 1,979, Majlis Agama Islam Dan Adat Resam Melayu Perak Darul Ridzuan 1,848, AmSec Nominees (Tempatan) Sdn bhd Assar Asset Management Sdn Bhd for Tabung Baitulmal Sarawak 1,814, Saleem Abdullatif Mustafa 1,648, Perbadanan Kemajuan Ekonomi Islam Negeri Perak 1,632, Lembaga Pemegang-Pemegang Amanah Yayasan Negeri Sembilan 1,610, Majlis Agama Islam Wilayah Persekutuan 1,506, Kumpulan Wang Simpanan Pekerja 1,500, Annual Report 2009

135 Regional Group Network Bank Islam Malaysia Berhad (98127-X) 11th Floor, Wisma Bank Islam Jalan Dungun, Bukit Damansara Kuala Lumpur Tel : Fax : Al-Wakalah Nominees (Tempatan) Sdn. Bhd. ( P) 11th Floor, Wisma Bank Islam Jalan Dungun, Bukit Damansara Kuala Lumpur Tel : Fax : BIMB Investment Management Berhad ( X) (formerly known as BIMB Unit Trust Management Berhad) 11th Floor, Wisma Bank Islam Jalan Dungun, Bukit Damansara Kuala Lumpur Tel : Fax : BIMB Foreign Currency Clearing Agency Sdn. Bhd. ( V) 11th Floor, Wisma Bank Islam Jalan Dungun, Bukit Damansara Kuala Lumpur Tel : Fax : Bank Islam Trust Company (Labuan) Ltd. (LL04013) Level 5 (J), Main Office Tower Financial Park Complex Jalan Merdeka F.T. Labuan Tel : (6) Fax : (6) BIMB Offshore Company Management Services Sdn. Bhd. ( M) Level 5 (J), Main Office Tower Financial Park Complex Jalan Merdeka F.T. Labuan Tel : (6) Fax : (6) Syarikat Takaful Malaysia Berhad ( K) 26th Floor, Annex Block Dataran Kewangan Darul Takaful No. 4, Jalan Sultan Sulaiman Kuala Lumpur Tel : Fax : Asean Retakaful International (L) Limited (LL01129) Level 14, Blok 4, Financial Park Complex Jalan Merdeka Wilayah Persekutuan Labuan Tel : , Fax : P.T. Syarikat Takaful Indonesia (Company No. C2-6712HT th.94) Graha A, Graha Takaful Indonesia Jalan Mampang Prapatan Raya No. 100, Jakarta Indonesia Tel : / Fax : BIMB Securities (Holdings) Sdn. Bhd. ( V) Level 18, Menara Yayasan Tun Razak 200, Jalan Bukit Bintang Kuala Lumpur Tel : Fax : Annual Report

136 REGIONAL GROUP NETWORK BIMB Securities Sdn. Bhd. ( X) Tingkat 1, Blok Podium, Bangunan AMDB No. 1, Jalan Lumut Kuala Lumpur Tel : Fax : Pembiayaan Perumahan Nasional Sdn. Bhd. ( A) Level 18, Menara Yayasan Tun Razak 200, Jalan Bukit Bintang Kuala Lumpur Tel : Fax : BIMSEC Nominees (Asing) Sdn. Bhd. ( P) Tingkat 2, Blok Podium, Bangunan AMDB No. 1, Jalan Lumut Kuala Lumpur Tel : Fax : BIMSEC Nominees (Tempatan) Sdn. Bhd. ( M) Tingkat 2, Blok Podium Bangunan AMDB No. 1, Jalan Lumut Kuala Lumpur Tel : Fax : BIMSEC Asset Management Sdn. Bhd. ( V) Tingkat 2, Blok Podium Bangunan AMDB No. 1, Jalan Lumut Kuala Lumpur Tel : Fax : BIMB Venture Capital Sdn. Bhd. ( H) Level 18, Menara Yayasan Tun Razak 200, Jalan Bukit Bintang Kuala Lumpur Tel : Fax : BIMB Musyarakah Satu Sdn. Bhd. ( A) Level 18, Menara Yayasan Tun Razak 200, Jalan Bukit Bintang Kuala Lumpur Tel : Fax : Islamic Banking & Finance Institute Malaysia Sdn. Bhd. ( M) Tingkat 3, Dataran Kewangan Darul Takaful Jalan Sultan Sulaiman Kuala Lumpur Tel : Fax : Syarikat Al-Ijarah Sdn. Bhd. ( P) Level 18, Menara Yayasan Tun Razak 200, Jalan Bukit Bintang Kuala Lumpur Tel : Fax : Annual Report 2009

137 I/We of NRIC No./Passport No./Company No. (ADDRESS) (Incorporated in Malaysia under the Companies Act, 1965) Form of Proxy telephone no. being a member/members of BIMB Holdings Berhad ( the Company ), hereby appoint in respect of shares of (ADDRESS) and/or in respect of shares of (ADDRESS) or failing him/her, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us and on my/our behalf at the 12th Annual General Meeting of the Company to be held at Tun Rahah Grand Hall, Level 1, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur on Monday, 23 November 2009 at a.m. and at any adjournment thereof. I/We indicate with an X in the appropriate spaces below as to how I/we wish my/our vote to be cast: Ordinary Resolution 1 To receive the Audited Accounts for the financial year ended 30 June 2009 together with the Reports of the Directors and Auditors thereon. Ordinary Resolution 2 To declare a first and final dividend of 1.20% less income tax of 25% for the financial year ended 30 June Ordinary Resolution 3 To re-elect Tan Sri Samsudin Osman, a Director who is retiring by rotation pursuant to Article 61 of the Company s Articles of Association. Ordinary Resolution 4 To re-elect Dato Hairuddin Mohamed, a Director who is retiring by rotation pursuant to Article 61 of the Company s Articles of Association. Ordinary Resolution 5 To re-appoint Dato Dr. Abdul Halim Ismail, a director who is retiring pursuant to Section 129 of the Companies Act, 1965, to hold office until the conclusion of the next Annual General Meeting of the Company. Ordinary Resolution 6 To approve the payment of Directors fees for the financial year ended 30 June Ordinary Resolution 7 To re-appoint Messrs. KPMG Desa Megat & Co. as Auditors of the Company and to authorise the Directors to fix their remuneration. Ordinary Resolution 8 Proposed Renewal of Shareholders Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature. For Against Subject to the abovestated voting instructions, my/our proxy may vote or abstain from voting on any resolution as *he/*she/*they may think fit. If appointment of proxy is under hand Signed by *individual member/*officer or attorney of member/*authorised nominee of (beneficial owner) No. of shares held: Securities Account No: Date: If appointment of proxy is under seal Seal The Common Seal of Articles of Association in the presence of:- was hereto affixed in accordance with its Director Director/Secretary No. of shares held : In its capacity as *member/*attorney of member/*authorised nominee of (beneficial owner) Securities Account No: Date: Important Notes : 1. A member of the Company entitled to attend and vote at this meeting is entitled to appoint one or more proxies to attend and vote for him. 2. The instrument appointing a proxy shall: (i) in case of an individual, be signed by the appointor or by his attorney; and (ii) in case of a corporation, be either under its common seal or signed by its attorney or by an officer on behalf of the corporation. 3. Where a member appoints more than one (1) proxy the appointment shall specify the proportions of his holdings to be represented by each proxy. 4. The instrument appointing a proxy must be deposited at the Registered Office of the Company at Level 18, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur, Malaysia not less than 48 hours before the time fixed for holding the meeting or any adjournment thereof. 5. A proxy may vote on a show of hands or by poll. If the form of proxy is returned without an indication as to how the proxy shall vote on any particular matter, the proxy may exercise his discretion as to whether to vote on such matter. 6. The lodging of a form of proxy does not preclude a member from attending and voting in person at the meeting should the member subsequently decides to do so. *Delete if inappropriate

138 Fold Here STAMP Level 18, Menara Yayasan Tun Razak 200 Jalan Bukit Bintang Kuala Lumpur Fold Here

139 BIMB Holdings Berhad ( X) Level 18, Menara Yayasan Tun Razak 200 Jalan Bukit Bintang Kuala Lumpur Tel: Fax:

140 Laporan Tahunan...menyahut cabaran.

141 Gegelung logam yang secara universal dikenali sebagai spring adalah inspirasi bagi kulit Laporan Tahunan kali ini. Bersifat elastik dan bingkas, ia berupaya untuk meregang dan menguncup, menyerap tekanan namun mampu kembali kepada keadaan asal, sesuatu yang simbolik bagi syarikatsyarikat dalam Kumpulan BHB. Dalam mengorak langkah ke hadapan untuk mengharungi rintangan serta persaingan yang kian getir dalam suasana ekonomi global, kami menyerlahkan keupayaan teras untuk mengadaptasikan diri bagi menyahut cabaran yang mendatang. Kami turut bergabung dalam menyatukan kekuatan dan sumber-sumber kami bagi merebut peluang yang sedia ada bagi mengagihkan nilai kepada pihak yang berkepentingan.

142 Kandungan Notis Mesyuarat Agung Tahunan Keduabelas 2 Penyata Mengiringi Notis Mesyuarat Agung Tahunan 4 Profil Korporat 5 Maklumat Korporat 6 Struktur Korporat Kumpulan 7 Profil Pengarah 8 Ketua-ketua Pegawai Eksekutif dalam Kumpulan 11 Surat kepada Pemegang Saham 13 Sorotan Operasi 18 Paparan Kewangan 5 tahun Kumpulan 24 Tanggungjawab Korporat 26 Sorotan 2008/ Penyata Tadbir Urus Korporat 32 Penyata Kawalan Dalaman 43 Maklumat Pematuhan Tambahan 45 Penyata Kewangan* 48 Hartanah Milik Kumpulan BHB 49 Statistik Pemegangan Saham 59 Rangkaian Kumpulan Serantau 62 Borang Proksi * Sila rujuk versi Inggeris Laporan Tahunan 2009 BHB untuk Penyata Kewangan bagi Tahun Kewangan Berakhir 2009 Laporan Tahunan

143 Notis Mesyuarat at Agung g Tahunan Ke-12 DENGAN INI ADALAH DIMAKLUMKAN bahawa MESYUARAT AGUNG TAHUNAN yang kedua belas (12) BIMB Holdings Berhad akan diadakan di Dewan Besar Tun Rahah, Aras 1, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur pada 23 November 2009 jam pagi untuk tujuan-tujuan berikut: Sebagai Urusan Biasa 1. Untuk menerima Akaun Beraudit bagi tahun kewangan berakhir 30 Jun 2009 berserta Laporan Pengarah dan Juruaudit mengenainya. (Resolusi 1) 2. Untuk mengisytiharkan dividen pertama dan akhir 1.20% ditolak cukai sebanyak 25% bagi tahun kewangan berakhir 30 Jun (Resolusi 2) 3. Untuk memilih semula para Pengarah berikut yang bersara mengikut giliran menurut Artikel 61 Tataurusan Pertubuhan Syarikat: a) Tan Sri Samsudin Osman (Resolusi 3) b) Dato Hairuddin Mohamed (Resolusi 4) 4. Untuk melantik semula Dato Dr. Abdul Halim Ismail, pengarah yang bersara menurut Seksyen 129, Akta Syarikat 1965, untuk memegang jawatan sehingga selesai Mesyuarat Agung Tahunan akan datang Syarikat. (Resolusi 5) 5. Untuk meluluskan bayaran yuran Pengarah bagi tahun kewangan berakhir 30 Jun (Resolusi 6) 6. Untuk melantik semula Tetuan KPMG Desa Megat & Co. sebagai Juruaudit Syarikat dan untuk memberi kuasa kepada para Pengarah untuk menetapkan ganjaran mereka. (Resolusi 7) Sebagai Urusan Khas 7. Cadangan Pembaharuan Mandat Pemegang Saham bagi Urus Niaga Berulang Dengan Pihak Berkaitan Berbentuk Hasil atau Perdagangan. Bahawa tertakluk kepada Akta Syarikat 1965, Memorandum dan Tataurusan Persatuan Syarikat serta Keperluan Penyenaraian Bursa Malaysia Securities Berhad, kelulusan adalah dan dengan ini diberikan kepada BIMB Holdings Berhad dan anak syarikatnya untuk memeterai kategori urus niaga berulang dengan pihak berkaitan yang berbentuk hasil atau perdagangan dengan pihak-pihak berkaitan sebagaimana yang dinyatakan di dalam Seksyen 2.2 Pekeliling kepada Pemegang Saham bertarikh 30 Oktober 2009 yang mana perlu bagi operasi harian Kumpulan, tertakluk kepada perkara-perkara berikut:- i. Urus niaga yang dijalankan adalah urusan perniagaan biasa dengan terma komersil biasa yang tidak lebih memihak kepada pihak berkaitan berbanding pihak awam; ii. Tidak menjejaskan kepentingan pemegang saham minoriti Syarikat; dan iii. Maklumat nilai agregat urus niaga yang telah dijalankan sepanjang tahun kewangan menurut mandat pemegang saham (Mandat) akan dilaporkan di dalam Laporan Tahunan bagi tahun kewangan tersebut. Dan bahawa Mandat yang diberikan menerusi resolusi ini hendaklah berkuatkuasa serta-merta selepas Resolusi ini diluluskan; 2 Laporan Tahunan 2009

144 NOTIS MESYUARAT AGUNG TAHUNAN KE-12 Dan bahawa Mandat tersebut hendaklah terus berkuatkuasa sehingga:- a. tamatnya Mesyuarat Agung Tahunan Syarikat akan datang, di mana ia akan luput, melainkan kuasa tersebut diperbaharui melalui satu resolusi yang diluluskan pada mesyuarat berkenaan; b. tamat tempoh di mana Mesyuarat Agung Tahunan yang akan datang perlu diadakan menurut Seksyen 143(1) Akta Syarikat 1965 (tetapi hendaklah tidak dilanjutkan sehingga tarikh lanjut yang dibenarkan menurut Seksyen 143(2) Akta Syarikat 1965); atau c. dibatalkan atau diubah oleh satu resolusi yang diluluskan oleh pemegang saham dalam satu mesyuarat agung. yang mana lebih awal. (Resolusi 8) 8. Untuk melaksanakan sebarang urusan biasa lain yang mana notis sewajarnya telah diberikan menurut Akta Syarikat Notis Penutupan Buku DENGAN INI DIMAKLUMKAN bahawa daftar ahli akan ditutup dari 10 hingga 11 Disember 2009 (termasuk kedua-dua tarikh tersebut) untuk menentukan kelayakan pemegang saham bagi pembayaran dividen. Dividen tersebut, jika diluluskan oleh pemegang saham pada Mesyuarat Agung Tahunan Kedua Belas, akan dibayar pada 17 Disember 2009 kepada pemegang saham yang mana nama mereka tersenarai di dalam daftar ahli atau rekod pendeposit pada 9 Disember DENGAN INI JUGA DIMAKLUMKAN bahawa pendeposit adalah layak menerima dividen bagi: a) Saham yang dipindahkan kepada akaun sekuriti pendeposit sebelum jam 4.00 petang pada 9 Disember 2009, berkenaan bagi pindahan biasa. b) Saham yang dibeli di Bursa Malaysia Securities Berhad berasaskan kelayakan menurut peraturan Bursa Malaysia Securities Berhad. Dengan Perintah Lembaga Pengarah SAIFUL NIZAM BIN YASIN (LS 08955) Setiausaha Syarikat Kuala Lumpur 30 Oktober 2009 Nota : 1. Seorang ahli Syarikat yang layak hadir dan mengundi di mesyuarat boleh melantik seorang proksi atau lebih daripada seorang proksi untuk hadir dan mengundi bagi pihaknya. 2. Surat cara pelantikan proksi hendaklah:- i) bagi orang perseorangan, ditandatangani oleh pelantik atau oleh wakilnya; dan ii) bagi sebuah perbadanan, hendaklah dibuat di bawah meterai rasmi atau ditandatangani oleh wakilnya atau oleh seorang pegawai bagi pihak perbadanan tersebut. 3. Jika seorang ahli melantik lebih daripada seorang (1) proksi, pelantikan tersebut hendaklah menyatakan bahagian pegangan sahamnya yang akan diwakili oleh setiap proksi. 4. Semua borang proksi hendaklah dihantar ke Pejabat Berdaftar Syarikat di Aras 18, Menara Yayasan Tun Razak, 200 Jalan Bukit Bintang, Kuala Lumpur tidak kurang daripada empat puluh lapan (48) jam sebelum masa yang ditetapkan untuk mengadakan mesyuarat atau sebarang penangguhannya. 5. Nota Penerangan kepada Urusan Khas i) Bagi Resolusi Biasa 8, sila rujuk kepada Pekeliling kepada Pemegang Saham bertarikh 30 Oktober Laporan Tahunan

145 Penyata Mengiringi i Notis Mesyuarat at Agung g Tahunan Penyata Menurut Perenggan 8.27(2) Keperluan Penyenaraian Bursa Malaysia Securities Berhad 1. Pengarah yang menawarkan diri untuk dipilih semula pada Mesyuarat Agung Tahunan kedua belas Syarikat:- Bahawa Tan Sri Samsudin Osman dan Dato Hairuddin Mohamed yang bersara mengikut giliran menurut Artikel 61 Tataurusan Persatuan Syarikat dan memohon pemilihan semula. Bahawa Dato Dr. Abdul Halim Ismail, bersara menurut Seksyen 129 Akta Syarikat 1965 dan menawarkan diri untuk dilantik semula. Butiran para Pengarah yang memohon untuk pemilihan semula dan pelantikan semula dibentangkan dalam Profil Pengarah pada muka surat 8 hingga 10 dalam Laporan Tahunan ini. 4 Laporan Tahunan 2009

146 Profil Korporat BIMB Holdings Berhad ( BHB ) adalah syarikat pegangan pelaburan yang beroperasi menurut lunas-lunas Islam. Pelabur dan pelanggan tertarik dengan reputasinya yang berlandaskan amalan beretika. BHB diperbadankan di Malaysia pada 20 Mac 1997, dan disenaraikan di Papan Utama Bursa Malaysia Securities Berhad (dahulu dikenali sebagai Kuala Lumpur Stock Exchange) pada 16 September tahun yang sama. Modal dibenarkan bagi BHB ialah RM2 bilion sementara modal berbayarnya pula ialah RM1,066,789,896. Anak-anak syarikat yang menjadi tunggak Kumpulan BHB merupakan pemimpin dalam pelbagai aktiviti perkhidmatan kewangan Islam, termasuk perbankan, takaful, pembrokeran dan perkhidmatan lain yang berkaitan. Laporan Tahunan

147 Maklumat Korporat LEMBAGA PENGARAH Tan Sri Samsudin bin Osman Pengarah Bukan Bebas Bukan Eksekutif/Pengerusi Encik Johan bin Abdullah Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif Pengarah Eksekutif Bukan Bebas Dato Mohd Bakke bin Salleh Pengarah Bebas Bukan Eksekutif Datuk Ismee bin Ismail Pengarah Bukan Bebas Bukan Eksekutif Dato Dr. Abdul Halim bin Ismail Pengarah Bukan Bebas Bukan Eksekutif Encik Mohd Zin bin Idris Pengarah Bebas Bukan Eksekutif Encik Salih Amaran bin Jamiaan Pengarah Bukan Bebas Bukan Eksekutif Puan Zaiton binti Mohd Hassan Pengarah Bebas Bukan Eksekutif Dato Hairuddin bin Mohamed Pengarah Bebas Bukan Eksekutif MAJLIS PENGAWASAN SYARIAH BANK ISLAM MALAYSIA BERHAD Dr. Ahmad Sobri bin Salamon Ustaz Mohd Bakir bin Haji Mansor Y.A.A. Dato Hj. Daud bin Muhammad Prof. Madya Dr. Yusof bin Ramli BADAN PENASIHAT SYARIAH SYARIKAT TAKAFUL MALAYSIA BERHAD Dr. Ahmad Sobri bin Salamon Datuk Abdul Hamid bin Said Ustaz Mohd Bakir bin Haji Mansor Dr. Aida binti Othman JAWATANKUASA SYARIAH BIMB SECURITIES SDN BHD Prof. Dato Paduka Dr. Mahmood Zuhdi bin Hj. A. Majid Dato Dr. Abdul Halim bin Ismail Ustaz Mohd Bakir bin Haji Mansor JAWATANKUASA PENAMAAN DAN PENILAIAN Pengerusi Dato Mohd Bakke bin Salleh Ahli Datuk Ismee bin Ismail Encik Mohd Zin bin Idris Puan Zaiton binti Mohd Hassan JAWATANKUASA GANJARAN Pengerusi Dato Mohd Bakke bin Salleh Ahli Datuk Ismee bin Ismail Encik Mohd Zin bin Idris Puan Zaiton binti Mohd Hassan JAWATANKUASA KHAS LEMBAGA PENGARAH Pengerusi Dato Hairuddin bin Mohamed Ahli Encik Mohd Zin bin Idris Dato Zukri bin Samat JAWATANKUASA AUDIT DAN PEMERIKSAAN Pengerusi Encik Mohd Zin bin Idris Ahli Encik Salih Amaran bin Jamiaan Puan Zaiton binti Mohd Hassan Dato Hairuddin bin Mohamed KETUA-KETUA EKSEKUTIF DALAM KUMPULAN Encik Johan bin Abdullah Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif Dato Zukri bin Samat Pengarah Urusan Bank Islam Malaysia Berhad Dato Mohamed Hassan bin Md Kamil Pengarah Urusan Kumpulan Syarikat Takaful Malaysia Berhad Dato Idris bin Md Tahir Ketua Pegawai Eksekutif/Pengarah Eksekutif (Operasi) BIMB Securities Sdn. Bhd. SETIAUSAHA SYARIKAT Encik Saiful Nizam bin Yasin (LS 08955) JURUAUDIT KPMG Desa Megat & Co (AF 0759) Aras 10, KPMG Tower 8 First Avenue, Bandar Utama Petaling Jaya, Selangor PEJABAT BERDAFTAR Aras 18, Menara Yayasan Tun Razak 200 Jalan Bukit Bintang Kuala Lumpur Tel: Fax: Laman web: PENDAFTAR SAHAM Symphony Share Registrars Sdn Bhd Aras 26, Menara Multi-Purpose Capital Square No 8, Jalan Munshi Abdullah Kuala Lumpur PENYENARAIAN BURSA SAHAM Pasaran Utama Bursa Malaysia Securities Berhad 16 September Laporan Tahunan 2009

148 Struktur Korporat Kumpulan pada 30 Jun 2009 Perbankan Takaful Pembrokeran Stok & Saham Pajakan Pegangan Pelaburan - Modal Teroka Lain-lain 51% Bank Islam Malaysia Berhad 65.22% Syarikat Takaful Malaysia Berhad 100% 0% BIMB Securities (Holdings) Sdn. Bhd. 100% 0% Syarikat Al-Ijarah Sdn. Bhd. 100% 0% 51% BIMB Venture Pembiayaan Capital Sdn. Bhd. # Perumahan Nasional Sdn. Bhd. # 100% 0% Al-Wakalah Nominees (Tempatan) Sdn. Bhd % ASEAN Retakaful International (L) Ltd 100% BIMB Securities Sdn. Bhd. 100% 0% 48% BIMB Musyarakah Islamic Banking & Satu Sdn. Bhd. Finance Institute Malaysia Sdn. Bhd. * 100% 0% BIMB Investment Management Berhad (dahulu dikenali sebagai BIMB Unit Trust Management Berhad) 100% 0% BIMB Foreign Currency Clearing Agency Sdn. Bhd % P.T. Syarikat Takaful Indonesia 64.70% P. T. Asuransi Takaful Umum 74.78% P. T. Asuransi Takaful Keluarga 100% 0% BIMSEC Nominees (Asing) Sdn. Bhd. 100% 0% BIMSEC Nominees (Tempatan) Sdn. Bhd. 100% 0% BIMSEC Asset Management Sdn. Bhd. 100% 0% Bank Islam (L) Ltd ^ 100% 0% BIMB Trust Company (Labuan) Ltd 100% 0% BIMB Offshore Company Management Services Sdn. Bhd. * Syarikat Bersekutu # Sedang menjalani proses pembubaran secara sukarela oleh ahli syarikat ^ Operasi ditamatkan Laporan Tahunan

149 Profil Pengarah ah Tan Sri Samsudin bin Osman Tan Sri Samsudin, warganegara Malaysia, berusia 62 tahun, adalah Pengarah Bukan Bebas Bukan Eksekutif dan Pengerusi BIMB Holdings Berhad. Beliau dilantik menganggotai Lembaga Pengarah pada 1 Februari Beliau berkelulusan Sarjana Pentadbiran Awam daripada Pennsylvania State University (Amerika Syarikat), Sarjana Muda Sastera (Kepujian) dan Diploma Pengurusan Awam daripada Universiti Malaya. Dari tahun 2001 hingga 2006, Tan Sri Samsudin merupakan Ketua Setiausaha Negara, Kerajaan Malaysia. Pada masa ini, Tan Sri Samsudin menyandang jawatan Presiden Perbadanan Putrajaya. Beliau juga merupakan Pengerusi Lembaga Kumpulan Wang Simpanan Pekerja ( KWSP ), Panel Pelaburan KWSP, Universiti Utara Malaysia dan juga Pengarah Sime Darby Bhd. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai sebarang konflik kepentingan dengan BHB kecuali sebagai Pengarah Nomini Lembaga Tabung Haji. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri kesemua enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Encik Johan bin Abdullah Encik Johan, warganegara Malaysia, berusia 53 tahun, adalah Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif dan Pengarah Eksekutif Bukan Bebas. Beliau dilantik menganggotai Lembaga Pengarah pada 15 Mei Beliau berkelulusan Sarjana Pentadbiran Perniagaan (Kewangan) daripada Morehead State University (Amerika Syarikat), Sarjana Muda Pentadbiran Perniagaan (Kewangan) daripada Eastern Michigan University (Amerika Syarikat) dan Diploma Perbankan daripada Universiti Teknologi MARA. Encik Johan memulakan kerjaya profesionalnya pada tahun 1987 dengan Bursa Saham Kuala Lumpur (kini dikenali sebagai Bursa Malaysia Berhad) sebagai Pegawai Penyenaraian. Pada 1989, beliau menyertai Bahagian Pembiayaan Korporat Bumiputera Merchant Bankers Berhad dan meninggalkan bank tersebut pada awal tahun 1995 sebagai Pengurus Kanan. Selepas itu, beliau menyertai Damansara Realty Berhad sebagai Pengurus Besar, Perancangan Korporat. Pada tahun 1999, beliau kembali menyertai Bursa Malaysia Berhad dan menyandang pelbagai jawatan kanan termasuk Timbalan Ketua Pegawai Penguat kuasa, Penguatkuasaan Kumpulan. Pada Mei 2008, beliau menyertai BIMB Holdings Berhad sebagai Pengarah Urusan Kumpulan/Ketua Pegawai Eksekutif. Encik Johan adalah pengarah Bank Islam Malaysia Berhad, Syarikat Takaful Malaysia Berhad, BIMB Securities Sdn Bhd serta Islamic Banking and Finance Institute Malaysia Sdn. Bhd. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri kesemua enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Dato Mohd Bakke bin Salleh Dato Mohd Bakke, warganegara Malaysia, berusia 55 tahun, adalah Pengarah Bebas Bukan Eksekutif. Beliau dilantik menganggotai Lembaga Pengarah pada 3 Jun Beliau berkelulusan Sarjana Muda Sains (Ekonomi) daripada London School of Economics and Political Science dan merupakan ahli Fellow Institute of Chartered Accountants, England and Wales. Beliau juga adalah ahli Institut Akauntan Malaysia. Pada masa ini, Dato Mohd Bakke memegang jawatan sebagai Pengarah Urusan Kumpulan Felda Holdings Berhad dan adalah mantan Pengarah Urusan Kumpulan dan Ketua Pegawai Eksekutif Lembaga Tabung Haji. Kini, Dato Mohd Bakke adalah Pengerusi Bank Islam Malaysia Berhad dan ahli Suruhanjaya Sekuriti Malaysia. Di BHB, Dato Mohd Bakke menyandang jawatan Pengerusi Jawatankuasa Penamaan dan Penilaian dan Jawatankuasa Ganjaran Lembaga Pengarah. Beliau tidak mempunyai sebarang hubungan kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri lima (5) daripada enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. 8 Laporan Tahunan 2009

150 PROFIL PENGARAH Datuk Ismee bin Ismail Datuk Ismee, warganegara Malaysia, berusia 44 tahun, adalah Pengarah Bukan Bebas Bukan Eksekutif. Beliau dilantik menganggotai Lembaga Pengarah pada 9 Oktober Beliau adalah ahli Institut Bertauliah Akauntan Pengurusan ( CIMA ) dan ahli Institut Akauntan Malaysia. Pada masa ini, Datuk Ismee adalah Pengarah Urusan Kumpulan dan Ketua Pegawai Eksekutif Lembaga Tabung Haji ( LTH ). Sebelum itu, beliau merupakan Ketua Pegawai Eksekutif ECM Libra Securities dan Pengarah ECM Libra Capital Sdn. Bhd. Beliau juga pernah berkhidmat dengan beberapa organisasi dalam pelbagai kapasiti antaranya selaku Pengurus Besar Kanan Kewangan LTH; Ketua Akauntan di Pengurusan Danaharta Nasional Berhad dan Pengurus Besar Pembangunan Perniagaan di Arab Malaysian Development Berhad serta beberapa jawatan berkaitan kewangan di Shell Malaysia. Datuk Ismee adalah Pengarah Bank Islam Malaysia Berhad dan TH Plantations Berhad. Beliau adalah ahli Jawatankuasa Penamaan dan Penilaian dan Jawatankuasa Ganjaran Lembaga Pengarah. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB melainkan sebagai Pengarah Nomini LTH. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri lima (5) daripada enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Dato Dr. Abdul Halim bin Ismail Dato Dr. Abdul Halim, warganegara Malaysia, berusia 70 tahun, adalah Pengarah Bukan Bebas Bukan Eksekutif. Beliau dilantik menganggotai Lembaga Pengarah pada 21 Ogos Beliau berkelulusan Sarjana Muda Sastera (Kepujian) daripada Universiti Malaya dan Doktor Falsafah (DPhil) Ekonomi daripada Oxford University, England. Dato Dr. Abdul Halim adalah mantan Pengarah Urusan Bank Islam Malaysia Berhad. Pada masa ini, beliau menyandang jawatan Pengarah Eksekutif BIMB Securities Sdn. Bhd. Beliau juga merupakan Pengarah Institut Kefahaman Islam Malaysia, Sime Darby Berhad serta ahli Majlis Penasihat Syariah Suruhanjaya Sekuriti dan Bank Negara Malaysia. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB kecuali sebagai Pengarah Nomini Permodalan Nasional Berhad. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri kesemua enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Encik Mohd Zin bin Idris Encik Zahari, warganegara Malaysia, berusia 66 tahun, adalah Pengarah Bebas Bukan Eksekutif. Beliau dilantik menganggotai Lembaga Pengarah pada 20 September Beliau berkelulusan Senior Cambridge Certificate. Beliau memulakan kerjaya di Malayan Banking Berhad ( Maybank ). Sepanjang perkhidmatan di Maybank, iaitu antara 1962 hingga 1996, beliau menyandang pelbagai jawatan kanan di Maybank, termasuk Pengurus Besar, Bahagian Perbankan Komersial (jawatan terakhir yang disandang beliau). Dari tahun 2000 hingga 2005, Encik Zahari merupakan Pengarah Urusan Inter-City MPC (M) Sdn. Bhd. Kini, Encik Zahari adalah Pengarah Bank Islam Malaysia Berhad. Beliau juga adalah Pengerusi Jawatankuasa Audit dan Pemeriksaan dan ahli Jawatankuasa Penamaan dan Penilaian, Jawatankuasa Ganjaran dan Jawatankuasa Khas Lembaga Pengarah. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri kesemua enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Laporan Tahunan

151 PROFIL PENGARAH Encik Salih Amaran bin Jamiaan Encik Salih Amaran, warganegara Malaysia, berusia 69 tahun, adalah Pengarah Bukan Bebas Bukan Eksekutif. Beliau dilantik ke Lembaga Pengarah pada 18 Februari Beliau berkelulusan Sarjana Pentadbiran Perniagaan daripada Wharton, University of Pennsylvania (Amerika Syarikat), Diploma Pentadbiran Awam daripada Victoria University, Wellington dan Sarjana Muda Sains (Ekonomi) daripada London School of Economics, University of London. Beliau adalah ahli Jawatankuasa Audit dan Pemeriksaan Lembaga Pengarah. Beliau pernah berkhidmat sebagai Timbalan Setiausaha, Bahagian Kewangan di Kementerian Kewangan, Malaysia; Pengurus Besar, Bahagian Perbankan Antarabangsa Malayan Banking Berhad; Penasihat Khas (Ekonomi) Sekretariat Komanwel, London; dan Timbalan Pengarah, Jabatan Pembiayaan dan Penggalakan Perdagangan Bank Pembangunan Islam ( IDB ) di Jeddah. Dari 2000 hingga 2002, beliau menyandang jawatan Wakil Serantau IDB bagi Brunei, Indonesia dan Malaysia yang berpusat di Kuala Lumpur. Encik Salih Amaran tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB melainkan sebagai Pengarah Nomini Permodalan Nasional Berhad. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri kesemua enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Puan Zaiton binti Mohd Hassan Puan Zaiton, warganegara Malaysia, berusia 53 tahun, adalah Pengarah Bebas Bukan Eksekutif. Beliau dilantik menganggotai Lembaga Pengarah pada 2 Februari Puan Zaiton adalah ahli Persatuan Akauntan Bertauliah ( ACCA ) dan ahli Institut Akauntan Awam Bertauliah Malaysia ( MICPA ). Pada masa ini, Puan Zaiton menyandang jawatan Pengarah Urusan Capital Intelligence Advisors Sdn Bhd. Beliau merupakan mantan Presiden/Pengarah Eksekutif Malaysian Rating Corporation Berhad ( MARC ). Sebelum menyertai MARC, Puan Zaiton berkhidmat selama 12 tahun dengan Maybank dan pernah menyandang pelbagai jawatan kanan termasuk Pengurus Besar, Perancangan Strategik Kumpulan sehingga beliau meletakkan jawatan pada Puan Zaiton adalah Pengarah Bank Islam Malaysia Berhad, Malaysian Industrial Development Finance Berhad, Credit Guarantee Corporation Malaysia Berhad dan ahli Suruhanjaya Syarikat Malaysia. Beliau juga menganggotai Jawatankuasa Audit dan Pemeriksaan, Jawatankuasa Penamaan dan Penilaian dan Jawatankuasa Ganjaran Lembaga Pengarah. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri lima (5) daripada enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. Dato Hairuddin bin Mohamed Dato Hairuddin, warganegara Malaysia, berusia 59 tahun, adalah Pengarah Bebas Bukan Eksekutif. Beliau dilantik menganggotai Lembaga Pengarah pada 9 Oktober Beliau berkelulusan Sarjana Muda Sains Sosial (Kepujian) daripada Universiti Sains Malaysia. Beliau merupakan Pengerusi Jawatankuasa Khas Lembaga Pengarah dan ahli Jawatankuasa Audit dan Pemeriksaan Lembaga Pengarah. Dato Hairuddin adalah mantan Komisioner Polis di Jabatan Siasatan Jenayah Komersil. Sepanjang 36 tahun berkhidmat, beliau memegang beberapa jawatan kanan dalam pasukan Polis, antaranya termasuk Timbalan Komisioner Polis (Ketua Polis Kedah), Penolong Komisioner Kanan I (Timbalan Pengarah Pentadbiran (Latihan) dan Penolong Komisioner Kanan II (Jabatan Siasatan Jenayah, Sarawak). Dato Hairuddin mempunyai pengalaman luas dalam pengesanan penipuan dan penyiasatan jenayah komersil. Beliau tidak mempunyai sebarang pertalian kekeluargaan dengan mana-mana Pengarah dan/atau pemegang saham utama BHB atau mempunyai konflik kepentingan dengan BHB. Beliau tidak pernah dikenakan sebarang tindakan undang-undang dalam tempoh sepuluh (10) tahun yang lepas. Beliau telah menghadiri kesemua enam (6) Mesyuarat Lembaga Pengarah yang diadakan pada tahun kewangan dilaporkan. 10 Laporan Tahunan 2009

152 Ketua-ketua Pegawai ai Eksekutif k dalam Kumpulan Encik Johan bin Abdullah Pengarah Urusan Kumpulan / Ketua Pegawai Eksekutif BIMB Holdings Berhad Dato Zukri bin Samat Pengarah Urusan Bank Islam Malaysia Berhad Dato Mohamed Hassan bin Md. Kamil Pengarah Urusan Kumpulan Syarikat Takaful Malaysia Berhad Dato Idris bin Md Tahir Ketua Pegawai Eksekutif / Pengarah Eksekutif (Operasi) BIMB Securities Sdn. Bhd. Laporan Tahunan

153 Duduk (dari kiri ke kanan) Dato Mohd Bakke bin Salleh Tan Sri Samsudin bin Osman (Pengerusi) Encik Johan bin Abdullah (Pengarah Urusan Kumpulan / Ketua Pegawai Eksekutif) Berdiri (dari kiri ke kanan) Dato Dr. Abdul Halim bin Ismail Datuk Ismee bin Ismail Puan Zaiton binti Mohd Hassan Dato Hairuddin bin Mohamed Encik Mohd Zin bin Idris Encik Salih Amaran bin Jamiaan 12 Laporan Tahunan 2009

154 Surat kepada Pemegang g Saham Pemegang g Saham yang dihargai, i Lembaga Pengarah BIMB B Holdings Berhad ( BHB atau Kumpulan ) dengan sukacitanya melaporkan bahawa BHB telah mencatatkan tk prestasi yang memuaskan walaupun ianya menghadapi suasana operasi yang mencabar sepanjang tahun dalam tinjauan. Kami dengan sukacitanya membentangkan Laporan Tahunan dan Penyata Kewangan BHB dan Kumpulan bagi tahun kewangan berakhir 30 Jun 2009 ( TK2009 ). Prestasi Kewangan Meskipun keadaan pasaran terus getir akibat kelembapan ekonomi global dan tempatan, hasil perolehan Kumpulan meningkat 4.44% kepada RM1.49 bilion pada TK2009 berbanding RM1.43 bilion pada tahun sebelumnya. Sebahagian besar daripada hasil perolehan Kumpulan ini disumbangkan menerusi pelaburan dana pendeposit dan dana pemegang saham yang masing-masing berjumlah RM1.02 bilion dan RM0.47 bilion. Namun, kutipan semula pembiayaan yang lebih rendah menyebabkan peruntukan dibuat bagi kerugian bersih berjumlah RM juta pada TK2009, berbanding kutipan semula pembiayaan bersih berjumlah RM7.55 juta pada TK2008. Ini seterusnya menjejaskan keuntungan sebelum zakat dan cukai ( KSZC ) Kumpulan bagi tahun dalam tinjauan, yang mengakibatkan kesusutan KSZC 21.20% kepada RM juta (TK2008: RM juta). Secara keseluruhan, kegiatan berasas dana lebih tinggi dan yuran yang stabil dan pendapatan daripada komisen operasi Perbankan kami membantu mengimbangi kesusutan 12.90% keuntungan Takaful, khususnya Takaful Am dan Takaful Keluarga. Dana pemegang saham meningkat 26.58% kepada RM1.27 bilion, manakala jumlah aset bertambah 15.65% kepada RM31.90 bilion. Aset ketara bersih Kumpulan sesaham meningkat 5.31% kepada 119 sen (TK2008: 113 sen), manakala pulangan ke atas aset dan pulangan ke atas ekuiti masing-masing 1.01% dan 9.98%. Bahagian perbankan Kumpulan mengekalkan kecukupan modal dengan nisbah modal asas 12.25% dan nisbah modal berwajaran risiko ( Risk-Weighted Capital Ratio - RWCR ) sebanyak 13.87%. Perbankan Islam Bank Islam Malaysia Berhad ( Bank Islam atau Bank ) mengorak langkah besar pada tahun dalam tinjauan, dengan mencapai semua sasaran prestasi dan menyempurnakan kesemua lima inisiatif Rancangan Pemulihan tiga tahunnya mengikut jadual. Jumlah pendapatan Kumpulan Perbankan bertambah 8.38% kepada RM1.27 bilion pada TK2009 daripada RM1.18 bilion pada tahun sebelumnya. Keadaan pasaran yang getir tidak menghalang Bank Islam daripada menjana KSZC RM juta, meskipun angka ini adalah kira-kira 25.58% lebih rendah daripada rekod KSZC RM juta yang dicatat pada TK2008. KSZC lebih rendah pada TK2009 disebabkan sebahagian besarnya oleh kutipan semula pembiayaan daripada para pelanggan yang dicatat pada tahun sebelumnya. Prestasi kewangan Kumpulan Perbankan adalah memberangsangkan, dengan peningkatan 20.80% keuntungan operasi kepada RM juta dan pertumbuhan pembiayaan bersih pada kadar 6.63% kepada RM9.66 bilion dan pertumbuhan deposit dari pelanggan pada kadar 21.44% kepada RM25.21 bilion. Permodalan dan petunjuk kualiti aset Kumpulan Perbankan terus kukuh pada TK2009 dengan RWCR 13.87% (TK2008: 13.15%) dan nisbah modal asas pada kadar 12.25% (TK2008: 11.27%). Pada April 2009, Bank Islam telah menerbitkan Saham Pilihan Bukan Kumulatif Boleh Tukar Islam ( Islamic Convertible Redeemable Non-Cumulative Preference Shares ICRNCPS ) bagi mempertingkatkan dana Tier-1 sebanyak RM540 juta ( Peningkatan Dana Bank Islam ). Berikutan penyelesaian Peningkatan Dana Bank Islam tersebut pada bulan Oktober 2009, RWCR Kumpulan Perbankan dijangka terus kukuh kepada 18.29%. Kualiti aset Kumpulan Perbankan jauh lebih baik berasaskan nisbah pembiayaan tidak berbayar bersih yang terus menurun kepada 4.90% (TK2008: 7.82%) dan nisbah liputan kerugian pembiayaan yang meningkat kepada 80.81% (TK2008: 75.84%). Pulangan ke atas ekuiti dan pulangan ke atas aset (berdasarkan KSZC) masing-masing susut kepada 16.55% (TK2008: 27.11%) dan 0.92% (TK2008: 1.50%), manakala nisbah kos kepada pendapatan jatuh sedikit kepada 56.86% (TK2008: 59.58%) meskipun Bank terus melabur dalam pengubahsuaian cawangan, pembesaran rangkaian, dan juga infrastruktur IT dan pembangunan modal insan. Laporan Tahunan

155 SURAT KEPADA PEMEGANG SAHAM Keseluruhan bahagian perniagaan Kumpulan Perbankan memperlihatkan prestasi yang baik pada TK2009. Bahagian Perbankan Pengguna kekal sebagai penyumbang terbesar, menyumbang 66.39% daripada jumlah kasar portfolio pembiayaan Bank. Pendapatan Bank yang bukan berasas dana juga mencatat kenaikan besar sebanyak 30.60% kepada RM juta, dengan sebahagian besar disumbang oleh bahagian Perbankan Pelaburan Korporat, Perbendaharaan dan Perbankan Pengguna. Perkembangan Penting Beberapa perkembangan penting berlaku pada TK2009 yang membantu memastikan Bank Islam terus dinamik dan kompetitif. Inisiatif penjenamaan semula korporat, pengubahsuaian cawangan dan transformasi perniagaan secara agresif membolehkan Bank Islam menerima Anugerah Platinum yang berprestij bagi Jenama Perkhidmatan Perbankan Islam Paling Dipercayai, salah satu kategori anugerah tahunan Reader s Digest Trusted Brands Award Bank menambah tujuh cawangan baru di lokasi strategik di seluruh negeri Selangor, Pahang dan Sabah, meluaskan rangkaiannya kepada 97 cawangan. Jumlah keseluruhan cawangan dijangka mencapai 100 buah menjelang penghujung Untuk mengekalkan momentum penyelarasan cawangannya serta meningkatkan capaian dan piawaiannya, cawangan yang sedia ada dipindahkan ke kawasan pertumbuhan perniagaan lebih strategik, manakala 15 cawangan telah diubahsuai. Selain itu, Bank terus mempertingkatkan saluran penyampaian alternatifnya. Untuk meluaskan perkhidmatan runcit tukaran mata wang asingnya, Bank Islam membuka dua Pusat Pertukaran Mata Wang satu di Terminal Syarikat Penerbangan Kos Rendah di Lapangan Terbang Antarabangsa Kuala Lumpur, dan satu lagi di Karamunsing, Sabah. Bagi memacu pertumbuhan perniagaan, beberapa produk dan perkhidmatan inovatif telah diperkenalkan, termasuk produk pelaburan berstruktur modal terjamin berasaskan penjagaan kesihatan An Najah NID-I, serta Al-Awfar, simpanan-i dan pelaburan-i perbankan Islam yang pertama sepertinya yang memberi hadiah wang tunai sebagai ganjaran kepada pelanggan. Untuk mengukuhkan modal insannya, Bank Islam telah membangunkan program kepimpinan dan perancangan penggantian secara tersusun. Sistem perbankan asas, sistem pengurusan risiko dan sistem kutipan kewangan yang lebih kukuh akan meningkatkan lagi keupayaan IT Bank secara keseluruhan. Bank lslam juga bekerjasama dengan Lembaga Tabung Haji ( LTH ) untuk memulakan jualan silang produk dan perkhidmatannya kepada kira-kira lima juta ahli dan kumpulan syarikatnya yang besar. Selain itu, anak syarikat milik penuh Bank, Bank Islam Trust Company (Labuan) Ltd, menandatangani memorandum persefahaman dengan Bank Muamalat Indonesia untuk meninjau kerjasama dalam perkhidmatan unit amanah dan kiriman wang ke negara yang mempunyai bilangan penduduk Islam yang terbesar di dunia. Pada TK2009, anak syarikat milik penuhnya, BIMB Investment Management Bhd, menerima Anugerah Dana Edge-Lipper Malaysia bagi Dana Seimbang Islam Aset Bercampur RM Terbaik. Sebagai langkah seterusnya, Bank Islam akan memulakan Rancangan Pertumbuhan Lestari selama tiga tahun berlandaskan asas kukuh yang telah disediakan di bawah Rancangan Pemulihan. Rangka tindakan strategik baru ini adalah berlandaskan enam inisiatif untuk memacu pertumbuhan perniagaan, iaitu inovasi perniagaan; pengurusan risiko yang mantap; pengukuhan infrastruktur yang perlu; pembinaan keupayaan dan kapasiti; pembangunan francais; dan pertumbuhan bukan lazim serta perkembangan korporat. Takaful & Takaful Semula Takaful Malaysia mencatat kesusutan kecil hasil operasi sebanyak 2.48% kepada RM1.05 bilion pada TK2009. Kesusutan ini adalah selaras dengan sumbangan yang lebih rendah daripada perniagaan Takaful Keluarga dengan ketiadaan produk yang serupa dengan produk sumbangan tunggal kait pelaburan, Takaful myal-afdhal, yang dengan sendirinya telah menjana RM90.2 juta pada TK2008. Walaubagaimanapun, perniagaan Takaful Am mencatat pertumbuhan 31.12% (berdasarkan sumbangan kasar) dengan penyelarasan semula beberapa kelas yang tidak menguntungkan pada TK2008 serta peningkatan keupayaan pengagihan Takaful Malaysia menerusi ejen korporat yang lebih meluas. Dalam keadaan pasaran kewangan yang tidak menentu, Takaful Malaysia berjaya menjana hasil perolehan pelabuaran yang memberangsangkan sebanyak RM juta, lebih tinggi berbanding pendapatan pelaburan sebanyak RM yang dicatat pada tahun sebelumnya. Keputusan ini adalah lebih mengalakkan memandangkan pulangan daripada portfolio ekuiti yang lebih rendah, selaras dengan kelemahan pasaran ekuiti tempatan, berserta kadar keuntungan yang merosot daripada perletakan deposit tetap. Pendapatan lebih tinggi daripada kelas aset lain membantu mengurangkan kesan hasil lebih rendah portfolio ekuiti. Pendapatan bersih portfolio bon Islam mencatat kenaikan 20.94% kepada RM84.69 juta sementara pendapatan bersih daripada terbitan pelaburan kerajaan meningkat 5.81% kepada RM19.11 juta. Pendekatan pengurusan proaktif Takaful Malaysia membolehkan portfolio ekuitinya secara keseluruhan mengatasi Indeks Emas Syariah FBM sebanyak 10.40%. KSZC Takaful Malaysia meningkat kepada RM49.72 juta berbanding RM37.91 juta pada tahun sebelumnya. Selaras dengan strategi penyelarasan semula untuk keluar daripada kelas yang tidak menguntungkan, perniagaan Takaful Am memperlihatkan prestasi yang memberangsangkan. Di samping itu, langkah yang diambil untuk meningkatkan produktiviti dan kecekapan operasi telah menurunkan jumlah tuntutan kepada RM28.18 juta dan menukar perbelanjaan hutang lapuk RM21.2 juta yang ditanggung pada TK2008 kepada kutipan semula RM5.6 juta pada TK Laporan Tahunan 2009

156 SURAT KEPADA PEMEGANG SAHAM Inisiatif Strategik Untuk mengekalkan kedudukannya yang kukuh dalam persekitaran yang sangat kompetitif, Takaful Malaysia berusaha sedaya upaya untuk memantapkan Skim Mudharabah yang amat berjaya atau pada dasarnya satu model kongsi keuntungan, menerusi beberapa inisiatif tambah nilai. Justeru itu, satu strategi tiga serampang telah dilaksanakan. Di bawah strategi pertama yang bertujuan untuk meningkatkan tahap perkhidmatan pelanggan, memperlihatkan syarikat melabur dalam teknologi IT untuk menambah baik pengurusan dan pengalaman pelanggan. Menerusi usaha memantapkan modal insan, kakitangan barisan depan dilatih supaya lebih responsif dan berpengetahuan. Untuk membaiki perkhidmatan kepada pasaran kelas pertengahan-atasan yang menjadi sasaran dan mahukan perkhidmatan yang lebih bermutu tinggi, Takaful Malaysia memperkenalkan prosedur operasi piawaian baru yang membantu menyediakan pendekatan perkhidmatan pelanggan yang tersusun dan lebih berdisiplin. Wakalah telah diperkenalkan pada akhir 2008 di bawah strategi kedua yang bertumpu kepada pembangunan saluran pengedaran runcit untuk menggantikan model runcit Takaful Keluarga yang sedia ada. Wakalah adalah sama dengan struktur agensi konvensional yang melibatkan pengambilan ejen runcit atau Perundingan Kewangan Takaful. Langkah ini menandakan kemasukan awal Takaful Malaysia ke dalam pasaran berpacu agensi yang sangat kompetitif, di mana tahap perkhidmatan dan produk inovatif penting untuk menjamin kejayaan. Akhir sekali, untuk memperluas dan menyelaraskan rangkaian pengedarannya, Takaful Malaysia menambah bilangan ejen korporatnya kepada lebih 1,000 dan memperkenalkan Takaful mydesk di pejabat Tabung Haji yang terpilih. Dengan keupayaan pengedaran yang dipertingkatkan ini, Takaful Malaysia telah dapat mengurangkan bilangan cawangan dan menyelaraskan operasi, dan seterusnya mengurangkan kos operasi dan meningkatkan kecekapan. Pada awal 2009, Takaful Malaysia melancarkan Premia, sistem asas baru untuk menggantikan sistem lamanya. Dengan infrastruktur IT yang dipertingkatkan ini, syarikat mempunyai kedudukan yang lebih kukuh untuk membaiki perkhidmatan kepada pelanggan, beroperasi tanpa batas dan meluaskan rangkaian agensinya. Dari segi sumber manusia, Takaful Malaysia kini mempunyai pasukan yang cukup mantap dan semua jawatan kanan telah diisi oleh ahli profesional yang berpengalaman. Dengan perancangan Bank Negara Malaysia untuk mengeluarkan dua lesen perniagaan Takaful yang baru, prospek bagi industri kewangan Islam adalah cerah sungguhpun gelanggang industri dijangka lebih kompetitif. Takaful Malaysia mengalualukan persaingan yang dijangka meningkat dengan peserta baru, kerana ini akan membantu menggiatkan industri serta meningkatkan inovasi produk dan perkhidmatan lagi mendorong semua peserta berusaha lebih keras. Pembrokeran Saham Bagi tahun dalam tinjauan, Kumpulan BIMSEC mencatat KSZC RM0.42 juta. Angka ini adalah 87.11% lebih rendah daripada KSZC RM3.24 juta pada tahun sebelumnya. Di peringkat syarikat, BIMB Securities Sdn. Bhd. ( BIMSEC ) juga mencatat kesusutan KSZC berbanding tahun lepas, daripada RM3.58 juta kepada RM0.79 juta. Ini adalah disebabkan kegawatan ekonomi yang menjejaskan pasaran ekuiti tempatan sejak suku keempat Dalam melangkah ke hadapan, bahagian pembrokeran saham kami akan terus menyusun strategi untuk meningkatkan perniagaan runcit dan institusinya. BIMSEC yakin dengan usaha pemasaran yang agresif dan pengukuhan pasukan urus niaga dan penyelidikannya, ia dapat meningkatkan bahagian pasarannya, dari segi jumlah dan nilai dagangan. Modal Teroka Kerugian Sebelum Zakat dan Cukai tergabung Kumpulan Modal Teroka, yang terdiri daripada BIMB Venture Capital Sdn Bhd ( BIMBVC ) dan BIMB Musyarakah Satu Sdn Bhd ( BIMBMS), bagi tahun kewangan adalah RM2.71 juta. (Nota: BIMBMS mencatat Kerugian Sebelum Zakat dan Cukai bagi tahun kewangan sebanyak RM2.73 juta manakala BIMBVC mencatatkan keuntungan sebelum cukai sebanyak RM0.02 juta). Dalam usaha untuk mengukuhkan perniagaan Kumpulan, keputusan telah diambil untuk tidak meneruskan penglibatan di dalam industri modal teroka. Strategi seterusnya adalah untuk mendapatkan kembali pelaburan yang dipegang oleh BIMBMS. Ketika ini, BIMBVC sedang melalui proses penutupan sukarela oleh para ahli. Pada bulan Mei 2009, Takaful Malaysia menandatangani perjanjian usaha sama dengan PT Syarikat Takaful Indonesia dan Koperasi Karyawan Takaful yang menetapkan terma dan syarat pegangan saham masing-masing dalam PT Asuransi Takaful Keluarga. Ini disusuli suntikan modal Takaful Malaysia sebanyak RM21.83 juta ke dalam PT Asuransi Takaful Keluarga pada bulan yang sama. Laporan Tahunan

157 SURAT KEPADA PEMEGANG SAHAM Pajakan (Ijarah) Syarikat pajakan hartanah Kumpulan, Syarikat Al-Ijarah Sdn. Bhd., mencatat KSZC RM17.12 juta pada tahun dalam tinjauan, menurun 24.40% berbanding KSZC RM19.50 juta pada tahun sebelumnya. Ini adalah kerana pengurangan ke atas pendapatan sewa beli pada tahun 2009 sebanyak 98.07% atau RM28.32 juta berikutan penebusan aset yang disewakan kepada Bank Islam pada bulan Julai Ini juga telah menyebabkan kenaikan kepada keuntungan luar biasa sebanyak RM14.54 juta di mana sebahagiannya telah dapat mengimbangi penurunan pendapatan sewa beli. Amalan Urus Tadbir Korporat Sebagai sebahagian daripada komitmen kami untuk menjamin ketelusan, integriti dan kebertanggungjawaban, Kumpulan terus melaksanakan langkah urus tadbir korporat yang kukuh untuk melindungi dan meningkatkan nilai pemegang saham. Langkah kawalan dalaman yang ketat dilaksanakan dalam budaya korporat untuk memastikan laporan yang telus dan bertanggungjawab. Setakat ini, Rangka Pengurusan Risiko Perniagaan Kumpulan yang membantu kami mengenal pasti, menilai, mengurus dan memantau risiko, juga diguna pakai dalam operasi anak syarikat utama kami. Menyedari betapa pentingnya IT untuk menyokong kecekapan perkhidmatan dan sistem penyampaian serta pelaksanaan rangka modal berasaskan risiko, subsidiari Perbankan kami, Bank Islam, telah membangunkan Rangka Risiko IT yang juga diguna pakai oleh anak syarikat Bank Islam. Inisiatif Tanggungjawab Korporat Sebagai syarikat pegangan pelaburan yang berlandaskan prinsip Syariah, Kumpulan BHB komited untuk melaksanakan amalan korporat yang bertanggungjawab dan lestari, bagi membolehkan kami mengimbangi prestasi keuntungan kami dengan prestasi sosial dan alam sekitar. Pada tahun dalam tinjauan, anak syarikat kami terus melaksanakan inisiatif tanggungjawab korporat ( CR ) dalam Masyarakat, Tempat Kerja, Pasaran dan Alam Sekitar. Butir-butir inisiatif CR terdapat dalam bahagian CR Laporan Tahunan ini. Tinjauan Ekonomi Dalam laporan Tinjauan Ekonomi Sedunia bagi bulan Oktober 2009, Tabungan Kewangan Antarabangsa ( IMF ) melaporkan bahawa ekonomi global akan kembali berkembang, disokong oleh prestasi ekonomi Asia yang kukuh dan kestabilan atau pemulihan sederhana di rantau lain. Di negara lebih maju, campur tangan kerajaan telah menstabilkan kegiatan dan merangsang pertumbuhan ekonomi sederhana. Ekonomi negara membangun dan baru, umumnya mendahului pemulihan, dipelopori oleh kebangkitan di Asia dan dibantu oleh pemulihan harga komoditi serta dasar-dasar yang menyokong. Banyak negara yang sedang berkembang di Eropah dan Kesatuan Negara Bebas khasnya, terjejas teruk akibat krisis ekonomi, dan pembangunan di negara ini lebih lemah berbanding negara lain. Kadar pemulihan adalah perlahan, dan kegiatan masih jauh di bawah tahap sebelum krisis. Pemulihan dirangsang oleh peningkatan pengeluaran dan kitaran inventori, dan terdapat tanda yang menunjukkan jualan runcit beransur-ansur stabil, mengembalikan keyakinan pengguna, dan mengukuhkan semula pasaran perumahan. Semakin prospek bertambah baik, harga komoditi melonjak daripada paras yang rendah awal tahun ini dan mula merancakkan semula perdagangan dunia. Selepas menguncup kira-kira 1% pada 2009, kegiatan global diramalkan bertambah kira-kira 3% pada 2010 tetapi masih jauh di bawah kadar yang dicapai sebelum krisis IMF meramalkan pertumbuhan global kira-kira 3.1% pada Masa depan ekonomi ASEAN lebih berbaur. Dalam ekonomi yang lebih berpacu ekspot seperti Malaysia dan Thailand, kegiatan akan meningkat secara beransur-ansur sepanjang separuh kedua 2009, dengan pertumbuhan yang lebih kukuh pada Di Malaysia, keyakinan pengguna dan perniagaan telah mula dilihat, mungkin dipengaruhi oleh pakej rangsangan fiskal Kerajaan, kadar faedah yang rendah dan langkah liberalisasi untuk menyokong ekonomi Malaysia. IMF meramalkan bahawa KDNK sebenar Malaysia akan menguncup kepada 3.6% pada 2009 dan akan pulih untuk mencecah 2.5% pada Masa Depan Pasaran Dalam industri perbankan Malaysia, aset perbankan Islam pada penghujung suku kedua 2009 merangkumi kira-kira 19% daripada jumlah aset perbankan, dengan jumlah pembiayaan mencecah RM118 bilion, mewakili kira-kira 20.1% daripada jumlah portfolio pembiayaan industri perbankan. Pembiayaan tidak berbayar bersih bagi bank-bank Islam di Malaysia kekal pada tahap rendah 2.4%. Sekuriti hutang Islam juga terus mengekalkan penguasaan dalam pasaran bon Malaysia, membentuk kira-kira 58% daripada jumlah pasaran bon dengan hampir dua pertiga daripada pasaran ekuiti adalah ekuiti yang mematuhi prinsip Syariah. Sektor Takaful menjana pertumbuhan dengan aset dana mencatat peningkatan lebih 8%. 16 Laporan Tahunan 2009

158 SURAT KEPADA PEMEGANG SAHAM Segmen kewangan Islam terus berkembang pesat. Semakin banyak institusi kewangan Islam muncul dalam 10 tahun yang lalu, termasuk bank-bank yang berasakan prinsip Islam sepenuhnya dan institusi kewangan pembangunan yang terlibat dalam kegiatan perbankan Islam, takaful, takaful semula dan aktiviti pasaran modal. Ada antaranya terus membentuk pakatan strategik dengan peserta asing. Berikutan pengumuman inisiatif liberalisasi sektor pada bulan April 2009, beberapa lesen perbankan Islam baru dan sehingga dua lesen takaful keluarga dijangka dikeluarkan tahun ini. Dalam industri global, aset kewangan Islam diramal meningkat kepada USD1.6 trilion menjelang 2012 manakala sukuk global dalam edaran setakat ini bernilai kira-kira USD152.8 bilion. Semua perkembangan ini menunjukkan bahawa kewangan Islam akan terus membentuk pasaran pertumbuhan yang menawarkan banyak sumber dana baru yang berpotensi untuk diterokai. Prospek Meskipun Kumpulan berjaya mengharungi pelbagai cabaran dalam TK2009, kami tetap berwaspada dalam mengorak langkah ke hadapan memasuki TK2010. Sungguhpun terdapat tanda positif yang menunjukkan pemulihan ekonomi dan banyak peluang dalam industri kewangan Islam, kami akan tetap berhati-hati dalam pengurusan kualiti aset segmen perniagaan perbankan, takaful dan pembrokeran kami. BHB akan terus melaksanakan langkah-langkah untuk mengurangkan kos overhed dan meningkatkan kecekapan operasi sambil meninjau peluang kerjasama strategik dengan rakan-rakan niaga yang sesuai. Untuk menyokong objektif perniagaan kami, kami akan terus meningkatkan teknologi, menambah baik sistem dan proses kami, mengurangkan risiko menerusi tabdir urus korporat dan rangka pengurusan risiko yang kukuh, dan memperbaiki kualiti modal insan kami. Anak syarikat perbankan kami, Bank Islam, akan terus berhatihati dalam kegiatan pembiayaannya dengan memberi penekanan kepada kualiti kredit penggunanya, serta pelanggan komersil dan korporat. Pada masa yang sama, ia akan menumpukan kepada sektor ekonomi yang tidak terjejas dengan kemelesetan, pendapatan bukan berasaskan dana dan pertumbuhan deposit apabila ia memulakan Rancangan Pertumbuhan Lestari baru untuk tiga tahun ( ). Bank akan juga terus melabur dalam usaha membina kapasiti dan keupayaan serta meningkatkan infrastruktur IT dan meluaskan rangkaian cawangan. Sambil bersiap sedia untuk menjana pertumbuhan pada tahun kewangan baru, Takaful Malaysia akan terus menguruskan pelaburannya dengan bijak serta menyelaraskan rangkaian cawangannya dan menggunakan infrastruktur Kumpulan untuk memasarkan produk dan perkhidmatannya. Sekalipun Takaful Malaysia berusaha untuk mengetatkan piawaian taja jaminnya dan melupuskan perniagaan yang tidak menguntungkan dalam portfolionya, kami yakin ia akan dapat mengukuhkan kedudukannya. Sebagai satu Kumpulan, BHB dan anak-anak syarikatnya akan bekerja keras untuk menempuh cabaran di pasaran dan merebut peluang-peluang yang terbuka di hadapan kami dan mengambil langkah-langkah yang perlu untuk melindungi kepentingan semua pihak yang berkepentingan. Kami yakin Kumpulan akan memberikan prestasi yang memuaskan pada TK2010. Penghargaan Lembaga Pengarah ingin merakamkan setinggi-tinggi penghargaan kepada para pemegang saham, pelanggan dan rakan niaga kami atas sokongan dan kepercayaan yang diberikan kepada BHB dan Kumpulan selama ini. Kami juga terhutang budi kepada Kerajaan dan pihak berkuasa kawal selia, khususnya Bank Negara Malaysia, Suruhanjaya Sekuriti dan Bursa Malaysia Securities Berhad, atas bimbingan dan sokongan padu mereka. Kepada pasukan pengurusan dan kakitangan Kumpulan BHB sekalian, kami juga ingin merakamkan penghargaan atas kesungguhan dan kegigihan mereka yang membolehkan Kumpulan meneruskan langkah menuju ke mercu jaya. Lembaga Pengarah juga ingin memberi jaminan kepada para Pemegang Saham kami yang dihargai bahawa kami akan terus bekerja keras dan menggunakan kepakaran dan kefahaman kami untuk menjana dan mengukuhkan pertumbuhan Kumpulan pada masa hadapan. Kami yakin bahawa semua pihak yang berkepentingan akan terus menyokong kami dalam usaha untuk mengukuh dan mengembangkan BHB. Terima kasih dan Wassalam. Tan Sri Samsudin Osman Pengerusi Laporan Tahunan

159 Sorotan Operasi Dalam bidang Perbankan, Bank Islam Malaysia Berhad ( Bank Islam atau Bank ) berjaya mencapai semua sasaran prestasi dan telah menyempurnakan Rancangan Pemulihan dengan teratur. Kami sukacita melaporkan bahawa Bank Islam kini merupakan sebuah bank yang lebih kukuh dengan modal yang secukupnya dan kini kembali mencatatkan pertumbuhan. Transformasi Bank kepada sebuah jenama yang bereputasi tinggi dan dipercayai dilaksanakan berlandaskan asas yang kukuh, penyampaian perkhidmatan cemerlang dan capaian lebih luas kepada produk dan perkhidmatan; inovasi produk berterusan; serta rekod keuntungan yang konsisten dan inovatif. Perbankan Islam 18 Laporan Tahunan 2009

160 SOROTAN OPERASI Di samping itu, pelaksanaan sistem pengurusan risiko yang dinamik dan proaktif; urus tadbir korporat yang mantap; pengembangan lembaran imbangan dan pengurusan aset-liabiliti yang teliti, profil kredit yang menggalakkan, campuran aset berkualiti dan pembiayaan tidak berbayar pada tahap yang berpatutan telah membolehkannya mengorak langkah maju ke hadapan. Dengan kakitangan dan kedudukan yang sesuai dan semua faktor yang membantu pencapaian prestasi cemerlang, Lembaga Pengarah yakin bahawa Bank Islam akan memenuhi janji sambil berusaha melaksanakan Rancangan Pertumbuhan Lestari. Laporan Tahunan

161 SOROTAN OPERASI Takaful & Takaful Semula Subsidiari Takaful & Takaful Semula kami, mencatatkan prestasi yang memuaskan dan beriltizam mencapai pertumbuhan perniagaan menerusi strategi serampang tiga mata, iaitu menambah baik pengalaman pelanggan, membangunkan saluran runcit agensi serba lengkap dan meluaskan saluran pengedaran secara keseluruhan. Untuk menjejak dan menguruskan pengalaman pelanggan, Takaful Malaysia memantapkan lagi bahagian teknologi maklumat ( IT ) dan sumber manusia serta memperkenalkan prosedur operasi piawai baru. Dengan memperkenalkan model saluran runcit agensi Wakalah pada lewat 2008, Takaful Malaysia kini berupaya bersaing dalam pasaran diterajui agensi yang sangat kompetitif. Untuk meluaskan rangkaian pengedaran, syarikat menambahkan bilangan ejen korporat kepada lebih 1,000 dan memperkenalkan Takaful mydesk di pejabat Lembaga Tabung Haji terpilih. Ini membolehkan Takaful Malaysia menyelaraskan operasinya dengan mengurangkan bilangan cawangan sambil meningkatkan kecekapan operasi. 20 Laporan Tahunan 2009

162 SOROTAN OPERASI Sejajar dengan rancangan pengembangan serantau, Takaful Malaysia mengukuhkan lagi struktur modal operasi Indonesia dengan pemeteraian perjanjian usaha sama dengan PT Syarikat Takaful Indonesia dan Koperasi Karyawan Takaful berkenaan dengan pegangan saham masing-masing dalam PT Asuransi Takaful Keluarga. Segala langkah yang wajar sudah pun diambil dan diteliti untuk membolehkan Takaful Malaysia terus berkembang maju pada tahun-tahun akan datang. Laporan Tahunan

163 SOROTAN OPERASI Lain-lain Pembrokeran Saham Bahagian pembrokeran saham mencatatkan prestasi yang positif walaupun pasaran saham tempatan agak lemah. Memandangkan sentimen pasaran semasa, Kumpulan BIMSEC kini sedang berusaha mengukuhkan perniagaan runcit dan institusi menerusi usaha pemasaran agresif di samping meluaskan pasukan pengedar dan penyelidiknya. Kumpulan BIMSEC yakin dapat meningkatkan volum dan nilai dagangan pada tahun kewangan baru. 22 Laporan Tahunan 2009

164 SOROTAN OPERASI Pajakan (Ijarah) Syarikat Al-Ijarah Sdn. Bhd., mencatat KSZC sebanyak RM17.12 juta pada tahun dalam tinjauan 24.40% lebih rendah berbanding tahun sebelumnya kerana penurunan pendapatan sewa beli. Modal Teroka Bahagian modal teroka Kumpulan mencatatkan Kerugian Sebelum Zakat dan Cukai tergabung sebanyak RM2.71 juta. Untuk mengukuhkan perniagaan Kumpulan serta merasionalisasi dan mempertingkat sinergi perniagaan, Kumpulan telah mengambil keputusan untuk tidak lagi berkecimpung dalam perniagaan modal teroka. Laporan Tahunan

165 Paparan Kewangan 5 Tahun Kumpulan 2005 RM RM RM 000 Dinyatakan semula 2008 RM RM 000 Modal Saham 562, , , ,390 1,066,790 Dana Pemegang Saham 1,086,537 (145,890) 921,118 1,005,284 1,272,533 Deposit daripada Pelanggan 13,238,227 14,148,593 17,388,633 20,535,907 24,871,451 Dana Takaful 2,172,424 2,445,551 2,635,212 3,197,799 3,452,341 Pembiayaan Pelanggan 9,096,791 8,601,387 8,403,285 9,055,028 9,661,864 Pelaburan 4,742,913 2,622,481 4,002,831 3,734,094 9,092,943 Jumlah Aset 18,507,972 17,742,000 22,551,201 27,582,097 31,898,208 Perolehan 1,087,432 1,115,953 1,858,669 1,426,814 1,490,180 Keuntungan/(Kerugian) sebelum Zakat dan Cukai (400,489) (1,177,939) 909, , ,132 Keuntungan/(Kerugian) Bersih (456,851) (1,230,008) 787, , ,659 Dividen tolak Cukai 10,133 13,193 9,694 9,601* Nisbah Pembiayaan kepada Deposit (%) Pembiayaan Tak Berbayar Bersih (%) Perolehan/(Kerugian) Sesaham (sen) (81.15) (218.49) Aset Ketara Bersih Sesaham (RM) 1.93 (0.26) Dividen Kasar Sesaham (%) * Dividen Bersih Sesaham (%) * * Cadangan dividen 1.20% tolak cukai sebanyak 25% tertakluk kepada kelulusan pemegang saham pada Mesyuarat Agung Tahunan akan datang. 24 Laporan Tahunan 2009

166 PAPARAN KEWANGAN 5 TAHUN KUMPULAN Dana Pemegang Saham (RM Bilion) Deposit daripada Pelanggan (RM Bilion) # # 2007 (0.15) Pembiayaan Pelanggan (RM Bilion) Jumlah Aset (RM Bilion) # # Dana Takaful (RM Bilion) Keuntungan/(Kerugian) Sebelum Zakat dan Cukai (RM Juta) # # (1,177.94) (400.49) 2005 Pendapatan/(Kerugian) Sesaham (sen) Aset Ketara Bersih Sesaham (RM) # # 2007 (218.49) 2006 (0.26) 2006 (81.15) # Dinyatakan semula Laporan Tahunan

167 Tanggungjawab Korporat Sebagai syarikat pegangan pelaburan yang beroperasi menurut prinsip Syariah, Kumpulan BHB sentiasa melaksanakan amalan korporat yang bertanggungjawab dan lestari, bagi memperkasa pelbagai pihak berkepentingan, khususnya masyarakat di mana kami beroperasi. Kami berusaha untuk mengimbangkan prestasi kewangan kami dengan prestasi sosial dan alam sekitar, dengan menghormati dan menggalakkan prinsip Islam di kalangan pelanggan kami yang menganuti pelbagai agama. Pada tahun dalam tinjauan, anak syarikat kami terus melaksanakan inisiatif tanggungjawab korporat ( CR ) yang bermakna kepada Masyarakat, Tempat Kerja, Pasaran dan Alam Sekitar. Usaha Memperkaya Masyarakat Selaras dengan komitmen Kumpulan untuk meningkatkan kesejahteraan masyarakat, Bank Islam Malaysia Berhad ( Bank ) bekerjasama dengan Prokhas Sdn. Bhd. (syarikat milik penuh Minister of Finance, Incorporated) dalam melaksanakan Projek Amal Jariah, untuk membaiki rumah golongan kurang upaya dan kurang bernasib baik. Bank juga bekerjasama dengan JAKIM untuk menaja 13 episod program televisyen bagi meningkatkan kesedaran orang ramai terhadap keperluan membaiki kesejahteraan masyarakat. Menerusi program lain yang bertujuan memperkaya masyarakat, Bank menyokong golongan yang kurang bernasib baik menerusi aktiviti gotong-royong, bekalan keperluan asas dan bantuan kewangan untuk bayaran sewa. Selain itu, Bank Islam turut menaja 5,000 naskhah akhbar untuk peserta dan masyarakat semasa acara Ipoh Starwalk Sumbangan Takaful Malaysia dihulurkan dalam bentuk derma kepada golongan kurang bernasib baik dan pertubuhan kebajikan, antara lain termasuk Al Khaadem Home of Hope, Badan Kebajikan Siti Khadijah, PERNIM, Rumah Nur Hikmah dan Lembaga Kebajikan Anak Yatim Sarawak. Takaful juga menyumbangkan RM25,000 kepada Rumah Anak Kesayanganku di Rawang untuk pembelian ketuhar dan keperluan bakeri mereka. Sumbangan ini akan membantu penghuninya, yang kebanyakannya anak yatim, untuk berdikari. Sebagai syarikat berkaitan kerajaan ( GLC ), BIMB Holdings Berhad sentiasa berpegang kepada objektif tanggungjawab korporat ( CR ) seperti ditetapkan dalam Buku Perak, yang menyenaraikan prinsip dan garis panduan untuk dilaksanakan oleh GLC bagi membolehkan mereka menyumbang secara proaktif kepada masyarakat sambil memberi nilai kepada pemegang saham masing-masing. Selaras dengan prinsip dan garis panduan Buku Perak, kami berusaha menyumbang kepada masyarakat dengan cara yang paling cekap dan berkesan, menurut norma dan amalan terbaik industri serta rangka kerja pihak pengawal selia yang berkaitan. 26 Laporan Tahunan 2009

168 Kami dengan sepenuh hati terus menyertai usaha membina masa depan yang lebih baik untuk generasi muda menerusi beberapa inisiatif pendidikan. Bank Islam membantu golongan yang memerlukan dengan menubuhkan tabung zakat kebajikan untuk pelajar universiti tempatan, memberi biasiswa kepada pelajar luar negara, dan juga membina dan menaik taraf sekolah agama. Bank telah menjadikan 13 buah sekolah di seluruh negara sebagai anak angkat selama tiga tahun di bawah program PINTAR (Promoting Intelligence, Nurturing Talent and Advocating Responsibility) dan juga membiayai bengkel bahasa Inggeris. Untuk menyemaikan tabiat merancang kewangan dengan baik di kalangan murid sekolah, Bank menyertai Program Sekolah Angkat bersama Bank Negara Malaysia untuk mengedarkan risalah kewangan kepada sekolah rendah dan menengah dan juga mengagihkan risalah versi Braille kepada golongan cacat penglihatan. Bank Islam juga menaja pelbagai inisiatif untuk menggalakkan inovasi dan kreativiti di universiti dan bekerjasama dengan New Straits Times Press untuk menaja peraduan dalam keluaran khas Niexter yang disasarkan kepada golongan belia. Laporan Tahunan

169 TANGGUNGJAWAB KORPORAT Pada bulan Januari 2009, Takaful Malaysia melancarkan program CR tunjangnya, yang dinamakan Takaful myjalinan. Tiga jenama cabangnya telah diperkenalkan di bawah jenama tunjang, setiap satu menyokong kumpulan tertentu yang kurang bernasib baik dalam masyarakat. Program myjalinankasih bertujuan untuk memberi bantuan kewangan dan kebendaan kepada ibu tunggal, anak yatim, orang kurang upaya dan fakir miskin. Al Khaadem Home of Hope di Shah Alam menjadi penerima pertama sumbangan di bawah program ini. Program myjalinanilmu menumpukan kepada bantuan untuk pelajar daripada keluarga fakir miskin. Penerima pertama bantuan ini ialah Sekolah Kebangsaan Permatang Binjai di Pulau Pinang dan beberapa pelajarnya yang miskin. Takaful Malaysia turut telah melancarkan projek Adopt-a-Tree di bawah program myjalinanalam, yang mencerminkan usaha Takaful Malaysia untuk melindungi dan memulihara alam sekitar. Buat masa ini, Kumpulan BHB adalah salah sebuah daripada 20 GLC ( G-20 ) yang terlibat dalam program Sejahtera, projek perintis yang dilancarkan barubaru ini untuk mengurangkan kemiskinan di bawah naungan Jawatankuasa Putrajaya mengenai Prestasi Tinggi GLC ( PCG ). Program Sejahtera PCG bertujuan untuk menambah mata pencarian dan memperkasakan golongan yang kurang bernasib baik di negara ini (termasuk fakir miskin, ibu tunggal dan warga tua) dengan memberi mereka kemahiran yang dapat membantu mereka memperoleh pendapatan yang lebih terjamin. Kami juga terus terlibat dalam program PINTAR, yang telah diperluaskan ke peringkat nasional dan menerapkan pendekatan baru dan bersepadu. Amalan Terbaik Tempat Kerja Sebagai sebahagian daripada usaha berterusan Bank Islam untuk menyediakan persekitaran kerja yang selesa untuk lebih 3,000 kakitangannya, Bank terus melaksanakan pelbagai inisiatif, termasuk latihan induksi untuk membiasakan kakitangan baru dengan suasana kerja dalam industri perbankan Islam, waktu kerja boleh suai (ketika bulan Ramadan), cuti peperiksaan untuk kakitangan yang melanjutkan pelajaran, dan keutamaan kepada pemohon dalaman untuk mengisi jawatan kosong. Bank juga memberi insentif kepada anak kakitangan yang mendapat keputusan cemerlang dalam peperiksaan, mewujudkan tabung bantuan untuk kakitangan yang memerlukan bantuan kewangan, dan menganjurkan kuliah agama oleh penceramah dalaman dan jemputan setiap hari untuk kakitangan. Selain itu, langkah kesihatan dan keselamatan yang ketat diambil untuk menjamin kesihatan dan keselamatan kakitangan. Inisiatif Pasaran Kumpulan BHB terus melaksanakan aktiviti pasaran yang memberi kesan ketara ke atas semua pihak berkepentingan. Untuk meningkatkan kesedaran orang ramai dan perkongsian pengetahuan, anak syarikat kami terus menyertai pelbagai pameran dan seminar tempatan dan serantau yang bertujuan untuk mempromosikan perbankan dan kewangan Islam. Sebagai sebahagian daripada usaha kami untuk meningkatkan pertumbuhan dan perkembangan industri, kami mengalu-alukan delegasi tempatan dan antarabangsa yang berminat untuk belajar daripada pengalaman Bank Islam. Kami juga menaja forum untuk membantu meningkatkan kesedaran orang ramai terhadap perbankan Islam dan kelebihan produk dan perkhidmatannya. Untuk meramaikan bakat perbankan Islam yang boleh dipercayai dalam industri, Bank Islam mengorak langkah pertama menerusi pelbagai inisiatif, termasuk bekerjasama dengan Dewan Amal Islam Hadhari ( DAMAI ) dan Institut Perbankan dan Kewangan Islam Malaysia ( IBFIM ) untuk memberi latihan kepada graduan pengajian Islam; membantu Pusat Pendidikan Kewangan Islam ( INCEIF ) membangunkan sukatan pelajaran dan kandungan untuk pelbagai kursus perbankan Islam; dan memulakan pertukaran pengetahuan dan kepakaran dua hala dengan European Islamic Investment Bank Plc yang berpangkalan di London menerusi pertukaran kakitangan profesional untuk jangka pendek. Usaha Memulihara Alam Sekitar BHB dan anak syarikatnya menyedari peranan yang boleh kami semua mainkan untuk membantu memulihara dan membaiki alam sekitar, dan kami sedang meninjau peluang untuk memainkan peranan yang lebih berkesan dalam aspek ini. Buat permulaan, Bank Islam menyertai Kempen Earth Hour WWF bagi meningkatkan kesedaran dan menyokong usaha global untuk 28 Laporan Tahunan 2009

170 menjimatkan tenaga. Bank juga memulakan Kempen Jom Jimat Kos di kalangan kakitangannya, untuk mengingatkan mereka supaya lebih berjimat cermat ketika keadaan getir ini. Kempen ini termasuk menggalakkan tindakan menyelamatkan pokok dan menjimatkan penggunaan sumber seperti tenaga dan air. Dalam mengorak langkah ke hadapan, BHB dan anak syarikatnya tetap berpegang kepada komitmennya untuk menanamkan amalan CR yang baik dalam budaya kerja kami dan dalam perniagaan kami. Matlamat jangka panjang kami ialah untuk melaksanakan inisiatif CR yang ketara dan memberi kesan positif, serta membolehkan kami menjalin hubungan yang kekal lama dengan pihak yang berkepentingan, termasuk pemegang saham dan kakitangan kami, rakan niaga dan pihak berkuasa kawal selia. Laporan Tahunan

171 Sorotan 2008/ Disember 2008 Syarikat Takaful Malaysia Berhad ( Takaful Malaysia ) melancarkan siri pertama produk berasaskan Wakalah, iaitu Takaful mymedicare, mysiswa, myimpian and mysinar. Rangkaian Produk Hayat (Keluarga) dan Produk Perubatan baru dan dipertingkatkan ini telah dilancarkan oleh Pengerusi Takaful Malaysia YBhg. Tan Sri Dr. Hadenan Abdul Jalil pada 3 Disember Disember Disember 2008 Mesyuarat Agung Tahunan Ke-11 BHB diadakan pada 17 Disember 2008, menyediakan saluran dialog untuk para pemegang saham berkaitan isu prestasi kewangan dan korporat Kumpulan BHB. 17 Disember Februari 2009 Memorandum Persefahaman merintis jalan bagi pakatan perkongsian eksklusif antara Bank Islam Trust Company (Labuan) Ltd. dan Kumpulan Bank Muamalat Indonesia untuk bekerjasama dalam mempromosikan produk amanah Islam kepada negara yang mempunyai penduduk Islam terbesar di dunia. 25 Mac 2009 Bank Islam melancarkan produk pertama seperti Al-Awfar Akaun-i Simpanan & Akaun Pelaburan, dengan tawaran unik yang membolehkan Bank memberi hadiah wang tunai sehingga RM100,000 sebagai ganjaran kepada pemegang akaun yang layak. 12 Februari Mac 2009 Bank Islam menganjurkan Persidangan Pengurus 2009 untuk memastikan semua pengurus dimaklumkan tentang Strategi Bank bagi Tahun Kewangan 2008/ Mac Annual Report Mac 2009

172 20 April April 2009 Perdana Menteri Yang Amat Berhormat Dato Sri Mohd Najib Bin Tun Haji Abdul Razak melancarkan Produk Berkaitan Pelaburan baru Takaful Malaysia, Takaful myinvest, sempena Minggu Saham Amanah Malaysia 2009 (MSAM 2009) di Johor Bahru pada 20 April Produk semua dalam satu ini dirangka untuk memenuhi keperluan pelabur yang ingin mempelbagaikan portfolio pelaburan mereka sambil mendapatkan perlindungan Takaful yang ideal. Ini adalah selaras dengan matlamat Takaful Malaysia untuk meningkatkan portfolio produknya. 16 Jun Jun 2009 BHB menganjurkan Mesyuarat Agung Luar Biasa pada 16 Jun 2009 untuk mendapatkan kelulusan pemegang saham untuk melaksanakan terbitan terhad 175,400,000 saham baru pada harga RM1.00 setiap satu kepada LTH bagi membolehkan BHB menyertai langkah menambah modal yang dilaksanakan oleh Bank Islam. 22 Jun Jun 2009 Takaful Malaysia melancarkan Takaful Malaysia Business Desk atau Takaful mydesk di Lembaga Tabung Haji. Pelancaran itu dilakukan sempena pemeteraian Perjanjian Kerjasama strategik antara pihak yang terlibat. Takaful Malaysia menyifatkan pakatan pintar ini sebagai landasan yang kukuh untuk menerokai pelbagai peluang perniagaan, termasuk jualan silang produk pelaburan dan simpanan. 8 Julai Julai 2008 Takaful Malaysia menandatangani Perjanjian Pengedaran dengan Standard Financial Planner Sdn. Bhd. (SFP). Takaful Malaysia melantik SFP untuk memasarkan produk Takaful Malaysia menerusi rangkaian lebih 300 wakilnya di seluruh negara, dengan 75 daripadanya adalah Penasihat Kewangan berlesen dengan Bank Negara Malaysia. Ini akan meluaskan tembusan Produk Keluarga dan Produk Am Takaful Malaysia ke dalam pasaran masyarakat pertengahan-atasan Malaysia menjadikan produk Takaful Malaysia lebih mudah dilanggan oleh pelanggan. 4 Ogos 2009 Pengarah Urusan Bank Islam, Dato Zukri Samat menyampaikan zakat perniagaan Bank bernilai RM1.7 juta kepada Y.B. Senator Dato Mejar Jeneral (B) Jamil Khir Bin Baharom untuk diagihkan kepada fakir miskin dan golongan yang memerlukan. 4 Ogos 2009 Annual Report