Financial Statements for the period ended 30 April 2012. Unaudited Statements of Financial Position As at 30 April 2012 Group Bank 30-Apr-12 31-Jan-12 30-Apr-12 31-Jan-12 (Restated) (Restated) ASSETS Note Cash and short-term funds 470,396 403,218 470,009 402,901 Deposits with financial institutions 7 663 20,631 663 20,631 Securities held-for-trading 8 476,108 360,985 476,108 360,985 Securities available-for-sale 9 676,195 673,363 676,195 673,363 Securities held-to-maturity 10 270,000 200,000 270,000 200,000 Derivative financial assets 11 6,948 6,688 6,948 6,688 Loan, advances and financing 12 484,078 556,570 484,078 556,570 Trade receivables 13 379,951 360,809 379,951 360,809 Statutory deposit with Bank Negara Malaysia 33,124 27,165 33,124 27,165 Other assets 14 22,717 26,697 22,702 26,689 Property, plant and equipment 21,371 21,714 21,371 21,714 Intangible assets 52,500 52,500 52,500 52,500 TOTAL ASSETS 2,894,051 2,710,340 2,893,649 2,710,015 LIABILITIES Deposits from customers 15 1,296,530 1,110,065 1,300,886 1,114,397 Deposits and placements of banks and other financial institutions 16 337,196 341,371 337,196 341,371 Trade payables 17 519,066 482,878 519,066 482,878 Derivative financial liabilities 11 14 57 14 57 Other liabilities 18 53,917 75,796 53,883 75,762 Amount owing to related companies 234 234 234 234 Deferred tax liabilities 4,166 7,470 4,166 7,470 TOTAL LIABILITIES 2,211,123 2,017,871 2,215,445 2,022,169 EQUITY Share capital 513,000 513,000 513,000 513,000 Reserves 169,934 179,469 165,204 174,846 682,934 692,469 678,204 687,846 2,894,057 2,710,340 2,893,649 2,710,015 Net assets per share (RM) 1.33 1.34 1.32 1.33 The Interim Financial Statements should be read in conjunction with the audited financial statements for the year ended 31 January 2012 of the Group and the Bank. 1
Financial Statements for the period ended 30 April 2012. Unaudited Condensed Income Statements for the First Quarter ended 30 April 2012 quarter ended Note 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 (Restated) (Restated) Group Revenue 42,748 43,710 42,748 43,710 Interest income Interest expense Net interest income Non-interest income Other non-operating income Net income Operating expenses Operating profit Writeback for losses on loans & financing (Allowance)/writeback bad & doubtful debts Writeback for impairment loss Profit before tax Taxation 19 20,135 21,183 20,135 21,183 20 (13,663) (11,762) (13,663) (11,762) 6,472 9,421 6,472 9,421 21 22,613 22,527 22,613 22,527 22 171 826 171 826 29,256 32,774 29,256 32,774 23 (20,971) (18,338) (20,971) (18,338) 8,285 14,436 8,285 14,436 24 45 369 45 369 25 (25) 1,785 (25) 1,785 26 108 956 108 956 8,413 17,546 8,413 17,546 36 (2,382) (4,369) (2,382) (4,369) Profit after tax 6,031 13,177 6,031 13,177 Other comprehensive income: Net (loss)/gain on avilable-for-sale financial assets (20,755) 10,827 (20,755) 10,827 Income tax relating to components 5,189 (2,707) 5,189 (2,707) of other comprehensive income Other comprehensive income for the (15,566) 8,120 (15,566) 8,120 period, net of tax Total comprehensive income for the (9,535) 21,297 (9,535) 21,297 period Earnings per share ("EPS"): - basic / diluted 1.18 2.57 1.18 2.57 The Interim Financial Statements should be read in conjunction with the audited financial statements for the year ended 31 January 2012 of the Group 2
Financial Statements for the period ended 30 April 2012. Unaudited Condensed Income Statements for the First Quarter ended 30 April 2012 quarter ended yearto-date Note 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 (Restated) (Restated) Bank Revenue 42,660 43,666 42,660 43,666 Interest income 19 20,124 21,183 20,124 21,183 Interest expense 20 (13,686) (11,792) (13,686) (11,792) Net interest income 6,438 9,391 6,438 9,391 Non-interest income 21 22,536 22,483 22,536 22,483 Other non-operating income 22 171 826 171 826 Net income 29,145 32,700 29,145 32,700 Operating expenses 23 (20,967) (18,334) (20,967) (18,334) Operating profit 8,178 14,366 8,178 14,366 Writeback for losses on loans & financing 24 45 369 45 369 (Allowance)/writeback bad & doubtful debts 25 (25) 1,785 (25) 1,785 Writeback of impairment loss 26 108 956 108 956 Profit before tax 8,306 17,476 8,306 17,476 Taxation 36 (2,382) (4,369) (2,382) (4,369) Profit after tax 5,924 13,107 5,924 13,107 Other comprehensive income: Net (loss)/gain on avilable-for-sale financial assets (20,755) 10,827 (20,755) 10,827 Income tax relating to components 5,189 (2,707) 5,189 (2,707) of other comprehensive income Other comprehensive income for the (15,566) 8,120 (15,566) 8,120 period, net of tax Total comprehensive income for the (9,642) 21,227 (9,642) 21,227 period Earnings per share ("EPS"): Sen Sen Sen Sen - basic / diluted 1.15 2.55 1.15 2.56 The Interim Financial Statements should be read in conjunction with the audited financial statements for the year ended 31 January 2012 of the Bank. 3
Unaudited Condensed Statement of Changes in Equity for the Financial Period ended 30 April 2012 Share capital Available-forsale revaluation reserve <----------Non-distributable------------> Equity compensation reserve Regulatory reserve Statutory reserve Distributable Retained profit Total Group RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 Balance as at 1 February 2012 513,000 20,046 212-80,787 73,678 687,723 - effect of change in accounting policy - - - - - 4,746 4,746 As restated 513,000 20,046 212-80,787 78,424 692,469 Total comprehensive income for the period - (15,566) - - - 6,031 (9,535) Transfer to regulatory reserve - - - 4,746 (4,746) - Balance as at 30 April 2012 513,000 4,480 212 4,746 80,787 79,709 682,934 Balance as at 1 February 2011 513,000 234 612-65,720 73,446 653,012 - effect of change in accounting policy - - - - - 6,353 6,353 513,000 234 612-65,720 79,799 659,365 Total comprehensive income for the period - 19,812 (400) - 15,067 (1,375) 33,104 Balance as at 31 January 2012 513,000 20,046 212-80,787 78,424 692,469 The Interim Financial Statements should be read in conjunction with the audited financial statements for the year ended 31 January 2012 of the Group. 4
Financial Statements for the period ended 30 April 2012. Unaudited Condensed Statement of Changes in Equity for the Financial Period ended 30 April 2012 <------------Non-distributable--------------> Distributable Available-forsale revaluation reserve Equity compensation reserve Share capital Regulatory reserve Statutory reserve Retained profit Total Bank RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 Balance as at 1 February 2012 - as previously reported 513,000 20,046 212-80,787 69,055 683,100 - effect of change in accounting policy - - - - - 4,746 4,746 As restated 513,000 20,046 212-80,787 73,801 687,846 Total comprehensive income for the period - (15,566) - - - 5,924 (9,642) Transfer to regulatory reserve - - - 4,746 - (4,746) - Balance as at 30 April 2012 513,000 4,480 212 4,746 80,787 74,979 678,204 Balance as at 1 February 2011 513,000 234 612-65,720 69,055 648,621 - effect of change in accounting policy - - - - - 6,353 6,353 As restated 513,000 234 612-65,720 75,408 654,974 Total comprehensive income for the period - 19,812 (400) - 15,067 (1,607) 32,872 Balance as at 31 January 2012 513,000 20,046 212-80,787 73,801 687,846 The Interim Financial Statements should be read in conjunction with the audited financial statements for the year ended 31 January 2012 of the Bank. 5
Unaudited Condensed Statement of Cash Flow for the Financial Period ended 30 April 2012 Group Bank 3 months ended 3 months ended 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Cash flows from operating activities Profit before tax 8,413 5,578 8,306 18,073 Adjustment for non-cash items 8,778 (10,801) 8,801 2,497 Operating profit before working capital changes 17,191 (5,223) 17,107 20,570 Net changes in operating assets (91,165) (162,820) (90,463) 157,240 Net changes in operating liabilities 197,680 (173,432) 197,708 153,321 Net cash used in operations 123,706 (341,475) 124,352 331,131 Cash flows from investing activities Dividend received 7-7 455 Net addition to property, plant and equipment (1,017) (5) (1,017) 1,784 Net (additions)/sale of securities (92,534) 85,523 (92,564) (229,512) Net cash (used in)/generated from investing activities (93,544) 85,518 (93,574) (227,273) Cash flows from financing activities Interest paid (13,663) 101,883 (13,686) (12,482) Net cash used in financing activities (13,663) (10) (13,686) (12,482) Net increase/(decrease) in cash and cash equivalents 16,499 (255,967) 17,092 91,376 Effects of exchange rate changes - - 874 Cash and cash equivalents at beginning of period 241,369 635,136 241,052 235,411 Cash and cash equivalents at end of period 257,868 379,169 258,144 327,661 Cash and cash equivalents comprise: Cash and short-term funds 470,396 534,257 470,672 505,409 Less: Monies held in trust (212,528) (155,088) (212,528) (177,748) 257,868 379,169 258,144 327,661 The Interim Financial Statements should be read in conjuntion with the audited financial statements for the year ended 31 January 2012 of the Group and the Bank. 6
Part A: Explanatory notes pursuant to Financial Reporting Standards ("FRS") 134 1 Basis of preparation This unaudited quarterly financial report of the Group has been prepared on a historical cost basis, unless otherwise disclosed in the notes to the financial statements and are in accordance with the Companies Act, 1965 and FRS 134 Interim Financial Reporting in Malaysia as modified by Bank Negara Malaysia ("BNM")'s Guidelines. The interim financial report should be read in conjunction with the audited financial statements of the Group for the year ended 31 January 2012. Since the previous annual audited financial statements as at 31 January 2012 were issued, the Group has adopted the Malaysian Financial Reporting Standards ("MFRS") framework issued by the Malaysian Accounting Standards Board ("MASB") with effect from 1 January 2012. This MFRS framework was introduced by the MASB in order to fully converge Malaysia's existing Financial Reporting Standards ("FRS") framework with the International Financial Reporting Standards ("IFRS") framework issued by the International Accounting Standards Board. Whilst all FRSs issued under the previous FRS framework were equivalent to the MFRSs issued under the MFRS framework, there are some differences in relation to the transitional provisions and effective dates contained in certain of the FRSs. The financial effects of convergence to the MFRS framework and any consequential changes in accounting policies as a result of the convergence are discussed in Note 33 Changes in accounting policies. The following MFRS, IC Interpretation and Amendments to MFRSs have been adopted by the Group during the current period: IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters (Amendments to MFRS 1) Disclosures Transfers of Financial Assets (Amendments to MFRS 7) Deferred Tax: Recovery of Underlying Assets (Amendments to MFRS 112) The adoption of the IC Interpretation and Amendments to MFRSs above generally did not have any material impact on the financial results of the Group, as they mainly help to clarify the requirements of or provide further explanations to existing MFRSs. The following MFRSs and IC Interpretations have been issued by the MASB and are not yet effective: Effective for annual periods commencing on or after 1 July 2012 Presentation of Items of Other Comprehensive Income (Amendments to MFRS 101) Effective for annual periods commencing on or after 1 January 2013 MFRS 10 Consolidated Financial Statements MFRS 11 Joint Arrangements MFRS 12 Disclosure of Interests in Other Entities MFRS 13 Fair Value Measurement MFRS 119 Employee Benefits (as amended in June 2011) MFRS 127 Separate Financial Statements (as amended by IASB in May 2011) MFRS 128 Investments in Associates and Joint Ventures (as amended by IASB in May 2011) IC Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to MFRS 7) 7
1 Basis of preparation (cont'd.) Effective for annual periods commencing on or after 1 January 2014 Offsetting Financial Assets and Financial Liabilities (Amendments to MFRS 132) Effective for annual periods commencing on or after 1 January 2015 MFRS 9 Financial Instruments (IFRS 9 issued by IASB in November 2009) MFRS 9 Financial Instruments (IFRS 9 issued by IASB in October 2010) IC Interpretation 20 will not have any financial impact to the Group as it is not relevant to the Group's operations. The financial effects of the above MFRSs and Amendments to MFRSs are still being assessed due to the complexity of these new MFRSs and Amendments to MFRSs, and their proposed changes. 2 Audit report of preceding annual financial statements The auditors report on the Financial Statements for the year ended 31 January 2012 of the was not subjected to any qualification. 3 Seasonality and cyclicality factors The operations of the were not materially affected either by seasonal or cyclical factors. 4 Exceptional items/unusual events There was no unusual item affecting assets, liabilities, equity, net income, or cash flows during the first 30 April 2012. 5 Variation from financial estimates reported in preceding financial year There were no changes in estimates of amounts reported in the preceding financial period that would have a material effect in the current quarter results. 6 Dividend paid During the financial 30 April 2012, a single tier dividend of 2.94 sen per ordinary share in respect of the financial ended 31 January 2012, amounting to RM15,067,000 was paid on 20 April 2012. 8
7 Deposits with financial institutions 30-Apr-12 31-Jan-12 RM 000 RM 000 Licensed banks 663 20,631 663 20,631 8 Securities held-for-trading 30-Apr-12 31-Jan-12 RM 000 RM 000 At fair value Malaysian Government Securities 30,006 60,708 Bankers' acceptance 313,647 194,977 Bank Negara Malaysia Notes 105,884 93,225 Quoted Securities - Private Debt Securities 24,958 10,074 - Shares 1,613 2,001 476,108 360,985 9 Securities available-for-sale 30-Apr-12 31-Jan-12 RM 000 RM 000 At fair value Malaysian Government Securities 212,709 254,019 Malaysian Government Investment Issues 167,402 89,122 Cagamas bonds 40,230 40,278 Quoted securities - Shares 124,351 145,728 - Shares outside Malaysia 15,395 - Unquoted securities - Private debt securities 102,813 130,027 - Preference shares 2,200 2,200 Unit trust fund 14,040 15,042 less: Impairment loss on securities available-for-sale (2,945) (3,053) 676,195 673,363 Securities that were reclassified out from held-for-trading to available-for-sale: Carrying value as at beginning of financial year 3,045 3,926 (Loss)/gain on revaluation - recognised in available-for-sale revaluation reserves (200) (881) Carrying value as at end of financial year/period 2,845 3,045 10 Securities held-to-maturity 30-Apr-12 31-Jan-12 RM 000 RM 000 At cost Negotiable instruments of deposit 270,000 200,000 270,000 200,000 9
11 Derivative financial assets/liabilities 30 Apr 2012 Contract / Notional amount Fair value Assets Fair value Liabilities RM 000 RM 000 RM 000 Equity related contracts 75,441 659 - Embedded derivatives 117,175 6,261 - Foreign exchange related contracts 3,690 28 14 31 Jan 2012 196,306 6,948 14 Equity related contracts 78,732 58 - Embedded derivatives 124,075 6,630 - Foreign exchange related contracts 2,140-57 204,947 6,688 57 12 Loans, advances and financing 30-Apr-12 31-Jan-12 (Restated) RM 000 RM 000 Share margin financing 298,784 360,591 Term loans 184,145 189,649 Revolving credit 3,481 8,706 Gross loans, advances and financing 486,410 558,946 Less: Collective assessment allowance (2,331) (2,376) Total net loans, advances and financing 484,078 556,570 By residual contractual maturity Maturity within 1 year 439,411 511,936 More than one year to three years 46,999 47,010 Gross loans, advances and financing 486,410 558,946 By economic purpose Purchase of securities 337,064 404,530 Working capital 74,313 79,367 Others 75,033 75,049 Gross loans, advances and financing 486,410 558,946 By interest rate sensitivity Fixed rate - Share margin financing, term loans and revolving credit 486,410 558,946 Gross loans, advances and financing 486,410 558,946 By type of customer Domestic business enterprises 361,954 417,999 Domestic non-bank financial institution 18,018 18,672 Individuals 106,438 122,275 Gross loans, advances and financing 486,410 558,946 10
12 Loans, advances and financing (continued) Movements in allowance for bad and doubtful debts 30-Apr-12 31-Jan-12 (Restated) RM 000 RM 000 Collective assessment allowance Balance at beginning of financial year - as previously reported 8,704 10,176 - effect of change in accounting policy (6,328) (8,471) Restated opening balance 2,376 1,705 Allowance made during the year (45) 671 Balance at end of financial year 2,331 2,376 As % of gross loans, advances and financing less specific allowance 0.5% 0.4% 13 Trade receivables 30-Apr-12 31-Jan-12 RM 000 RM 000 Amount owing by clients 202,102 165,279 Amount owing by brokers 178,912 196,574 381,014 361,853 Less: Individual assessment allowance (1,063) (1,044) 379,951 360,809 14 Other assets Group Bank 30-Apr-12 31-Jan-12 30-Apr-12 31-Jan-12 Interest receivables 5,131 7,652 5,131 7,652 Deposits 6,376 6,215 6,377 6,215 Tax recoverable 213 8 198 - Other receivables, deposits and prepayments 13,273 15,108 13,273 15,108 24,993 28,983 24,978 28,975 Less: Individual assessment allowance (2,276) (2,286) (2,276) (2,286) 22,717 26,697 22,702 26,689 11
15 Deposits from customers Group Bank 30-Apr-12 31-Jan-12 30-Apr-12 31-Jan-12 By type of deposits Short-term deposits 1,253,222 1,093,352 1,257,428 1,097,684 Negotiable instruments of deposit 43,307 16,713 43,458 16,713 1,296,530 1,110,065 1,300,886 1,114,397 By type of customers Government and statutory bodies 175,400 116,300 175,400 116,300 Business enterprises 285,738 189,236 290,094 193,568 Individuals 55,158 27,066 55,158 27,066 Non-bank financial institutions 779,632 776,863 779,632 776,863 Domestic other entities 602 600 602 600 1,296,530 1,110,065 1,300,886 1,114,397 Maturity structure of short term deposits and negotiable instruments of deposit are as follows: Due within 6 months 1,222,898 1,090,302 1,227,254 1,094,634 More than 6 months to 1 year 73,632 19,763 73,632 19,763 1,296,530 1,110,065 1,300,886 1,114,397 16 Deposits and placements of banks and other financial institutions 30-Apr-12 31-Jan-12 RM 000 RM 000 Licensed banks 267,154 266,409 Licensed investment banks 70,042 74,962 337,196 341,371 17 Trade payables 30-Apr-12 31-Jan-12 RM 000 RM 000 Amount owing to clients 123,585 102,743 Amount owing to brokers 208,031 221,589 Client's trust monies 187,450 158,546 519,066 482,878 18 Other liabilities Group Bank 30-Apr-12 31-Jan-12 30-Apr-12 31-Jan-12 Accruals and deposits received 9,339 6,268 5,859 6,238 Remisiers and dealers trust accounts 27,377 20,710 27,377 20,710 Other payables 17,199 44,406 20,647 44,406 Provision for taxation - 2,830-2,826 53,915 74,214 53,883 74,180 12
19 Interest income 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Group RM 000 RM 000 RM 000 Loans and advances 10,159 12,531 10,159 12,531 Stockbroking clients 146 87 146 87 Short-term funds and deposits with financial institutions 2,545 2,918 2,545 2,918 Securities: - Held-for-trading 218 218 - - Available-for-sale 4,491 3,333 4,491 3,333 - Held-to-maturity 1,713 805 1,713 805 Others 8 15 8 15 19,280 19,689 19,280 19,689 Accretion of discounts less amortisation of premiums 855 1,494 855 1,494 20,135 21,183 20,135 21,183 Bank Loans and advances 10,159 12,531 10,159 12,531 Stockbroking clients 146 87 146 87 Short-term funds and deposits with financial institutions 2,534 2,918 2,534 2,918 Securities: - Held-for-trading 218-218 - - Available-for-sale 4,491 3,333 4,491 3,333 - Held-to-maturity 1,713 805 1,713 805 Others 8 15 8 15 19,269 19,689 19,269 19,689 Accretion of discounts less amortisation of premiums 855 1,494 855 1,494 20,124 21,183 20,124 21,183 20 Interest expense 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Group Deposits from customers 11,185 10,724 11,185 10,724 Deposits from banks and other financial institutions 2,445 1,030 2,445 1,030 Others 33 8 33 8 13,663 11,762 13,663 11,762 Bank Deposits from customers 11,185 10,724 11,185 10,724 Deposits from banks and other financial institutions 2,468 1,060 2,468 1,060 Others 33 8 33 8 13,686 11,792 13,686 11,792 13
21 Non-interest income Group 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Fee income - Fees on loans and advances 3,314 2,171 3,314 2,171 - Corporate advisory fees 405 510 405 510 - Net brokerage fee 12,700 14,359 12,700 14,359 - Other fee income 77 85 77 85 16,496 17,125 16,496 17,125 Net gain arising from securities held -for-trading - net gain on disposal 3,525 3,100 3,525 3,100 - unrealised revaluation gain 31 257 31 257 - gross dividend income 7 5 7 5 3,563 3,362 3,563 3,362 Net gain arising from securities available-for-sale - net gain on disposal 915 243 915 243 - gross dividend income - 450-450 915 693 915 693 Net gain arising from derivatives - net gain on disposal - 1,142-1,142 - unrealised revaluation gain/(loss) 672 (669) 672 (669) 672 473 672 473 Gain on foreign exchange transactions 967 874 967 874 Total non-interest income 22,613 22,527 22,613 22,527 Bank Fee income - Fees on loans and advances 3,314 2,171 3,314 2,171 - Corporate advisory fees 405 510 405 510 - Net brokerage fee 12,700 14,359 12,700 14,359 - Other fee income - 41-41 16,419 17,081 16,419 17,081 Net gain arising from securities held -for-trading - net gain on disposal - securities 3,525 3,100 3,525 3,100 - unrealised revaluation gain 31 257 31 257 - gross dividend income 7 5 7 5 3,563 3,362 3,563 3,362 Net gain arising from securities available-for-sale - net gain on disposal 915 243 915 243 - gross dividend income - 450-450 915 693 915 693 Net gain arising from derivatives - net gain on disposal - 1,142-1,142 - unrealised revaluation gain/(loss) 672 (669) 672 (669) 672 473 672 473 Gain on foreign exchange transactions 967 874 967 874 Total non-interest income 22,536 22,483 22,536 22,483 14
22 Other non-operating income 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Rental income 37 63 37 63 Gain on disposal of assets 5-5 - Others 129 763 129 763 171 826 171 826 23 Operating expenses Group 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Personnel expenses Salaries, allowance and bonus 8,978 7,159 8,978 7,159 Contributions to defined contribution plan 1,257 1,077 1,257 1,077 Other personnel costs 382 429 382 429 10,617 8,665 10,617 8,665 Establishment costs Depreciation of property, plant and equipment 1,180 951 1,180 951 Amortisation of computer software 181 137 181 137 Rental of premises 1,570 1,298 1,570 1,298 Rental of network and equipment 1,138 1,075 1,138 1,075 Other establishment costs 946 759 946 759 Property plant and equipment written off 4-4 - 5,019 4,220 5,019 4,220 Marketing and communication expenses Advertising expenses - 7-7 Entertainment 235 202 235 202 Other marketing expenses 293 3 293 3 528 212 528 212 Administrative and general expenses Audit fees 45 27 45 27 Legal and professional fees 255 1,755 255 1,755 Printing and stationery 209 215 209 215 Insurance, postages and courier 245 278 245 278 Electricity and water charges 314 251 314 251 Telecommunication expenses 108 132 108 132 Travelling and accomodation 92 186 92 186 Others 3,539 2,397 3,539 2,397 4,807 5,241 4,807 5,241 Total operating expenses 20,971 18,338 20,971 18,338 15
23 Operating expenses (continued) Bank 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Personnel expenses Salaries, allowance and bonus 8,978 7,159 8,978 7,159 Contributions to defined contribution plan 1,257 1,077 1,257 1,077 Other personnel costs 382 429 382 429 10,617 8,665 10,617 8,665 Establishment costs Depreciation of property, plant and equipment 1,180 951 1,180 951 Amortisation of computer software 181 137 181 137 Rental of premises 1,570 1,298 1,570 1,298 Rental of network and equipment 1,138 1,075 1,138 1,075 Other establishment costs 946 759 946 759 Property plant and equipment written off 4-4 - 5,019 4,220 5,019 4,220 Marketing and communication expenses Advertising expenses - 7-7 Entertainment 235 202 235 202 Other marketing expenses 293 3 293 3 528 212 528 212 Administrative and general expenses Audit fees 51 25 51 25 Legal and professional fees 253 1,753 253 1,753 Printing and stationery 209 215 209 215 Insurance, postages and courier 245 278 245 278 Electricity and water charges 314 251 314 251 Telecommunication expenses 108 132 108 132 Travelling and accomodation 93 186 93 186 Others 3,530 2,397 3,530 2,397 4,803 5,237 4,803 5,237 Total operating expenses 20,967 18,334 20,967 18,334 24 Writeback for losses on loans and financing 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 (Restated) (Restated) Collective assessment allowance - Writeback during the financial period (45) 228 (45) (369) 16
25 Provision/(writeback) of bad and doubtful debts on trade receivables 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Individual assessment allowance - Provided during the financial period 38 37 38 37 - Written back during the financial period - (21) - (21) Bad debts: - Recovered (13) (1,801) (13) (1,801) 25 (1,785) 25 (1,785) 26 Writeback for impairment loss 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Writeback for impairment loss on securities: - Available-for-sale (108) (956) (108) (956) 17
Interim Financial Statements for the period ended 31 January 2012. 27 Capital adequacy The following is the computation of the capital adequacy ratio of the Bank: (a) Risk weighted capital ratios and Tier I and Tier II capital 30-Apr-12 31-Jan-12 (Restated) RM 000 RM 000 Tier 1 Capital Paid-up share capital 513,000 513,000 Retained profit 69,055 69,055 Statutory reserve 80,787 80,787 Other reserves 212 212 Total Tier 1 capital (a) 663,054 663,054 Tier 2 Capital Collective assessment 2,331 2,376 Total Tier 2 capital (b) 2,331 2,376 Total capital base (a) + (b) 665,385 665,430 Total risk-weighted assets 1,272,697 1,314,270 % Core capital ratio 52.1% 50.5% Risk weighted capital ratio 52.3% 50.6% The capital adequacy ratios of the Bank are computed in accordance with BNM's revised Risk-Weighted Capital Aqeduacy Framework (RWCAF-Basel II). The Bank have adopted the Standardised Approach for Credit Risk and Market Risk and the Basic Indicator Approach for Operational Risk. The minimum regulatory capital adequacy requirement is 8.0% (Jan 2012: 8%) for the risk-weighted capital ratio. The breakdown of risk-weighted assets (RWA) by each major risk category is as follows: 30-Apr-12 RM'000 31-Jan-12 RM'000 Credit risk 547,388 511,769 Market risk 463,581 528,595 Operational risk 261,728 273,906 1,272,697 1,314,270 18
28 Debt & equity securities There was no issuance, cancellation, repurchase, resale and repayment of either debt or equity securities during the quarter under review. 29 Valuation of Property, Plant and Equipment There was no valuation of property, plant and equipment of the Group and the Bank in the quarter under review. 30 Material Subsequent Event There were no material events subsequent to 30 April 2012. 31 Changes in the Composition of the Bank There are no changes in the composition of the Group and the Bank during the quarter under review. 32 Commitments and Contingencies (a) Capital Commitments As at 30 April 2012, the has commitments in respect of capital expenditure as follows: - RM'000 Authorised and contracted for 1,296 (b) Other Commitments and Contingencies In the normal course of business, the Bank makes various commitments and incurs certain contingent liabilities with legal recourse to its customers. No material losses are anticipated as a result of these transactions. The risk-weighted exposures of the Bank are as follows: Credit Risk Nominal Equivalent Weighted Amount Amount * Amount RM'000 RM'000 RM'000 As at 30 April 2012 Commitments to extend credits with maturity of less than 1 year: - margin facilities 613,351 122,670 69,448 - term loan facilities 21,295 5,309 43,898 Foreign exchange related contracts 161,351 53 53 795,997 128,032 113,399 As at 31 January 2012 Commitments to extend credits with maturity of less than 1 year: - margin facilities 492,574 98,515 68,415 - term loan facilities 60,667 13,183 32,462 Foreign exchange related contracts 5,814 91 35 559,055 111,789 100,912 * The credit equivalent amount is arrived at using the credit conversion factors as specified by Bank Negara Malaysia. 19
33 Performance Review on the Results of the Bank Group For the current quarter under review, the Bank Group recorded a profit before tax of RM8.4 million. This is largely contributed by net brokerage income of RM12.7 million, fee income of RM3.7 million, net gain from trading and investment securities of RM4.4 million and net interest income of RM6.5 million; partially offset by operating expenses of RM21.0 million. 34 Review of Performance of Financial Quarter against Preceding Financial Quarter For the financial quarter under review, the Bank Group achieved a profit before tax of RM8.4 million as compared to the RM3.5 million registered for the immediate preceding quarter. For the current quarter, the Bank Group incurred RM21.0 million operating expenses as compared to RM25.5 million in the immediate previous quarter. 35 Bank s Prospects With the Bank's strong fundamentals and balance sheet position, the Bank is expected to record a satisfactory performance in the current financial year. 36 Income tax expense Group 30-Apr-12 30-Apr-11 30-Apr-12 30-Apr-11 Income tax: period provision 497-497 - Deferred taxation: period transfer from deferred tax 1,885 4,518 1,885 4,518 2,382 4,518 2,382 4,518 Bank 30-Apr-12 31-Jan-12 30-Apr-12 31-Jan-12 Income tax: period provision 497-497 - Deferred taxation: period transfer from deferred tax 1,885 4,518 1,885 4,518 2,382 4,518 2,382 4,518 20
37 Changes in accounting policies (a) Transition to the MFRS Framework These unaudited interim financial statements are for part of the period covered by the Bank Group's first annual financial statements prepared under the MFRS framework. Accordingly, the Bank Group has applied MFRS 1 Firsttime Adoption of Malaysian Financial Reporting Standards in their transition to the MFRS framework on 1 February 2012. The policy elections made on transition date are listed in the audited financial statements of the Bank Group for the financial year ended 31 January 2012. The MFRS did not result in any financial impact to the Group other than the financial impact arising from the change in accounting policy on collective assessment allowance, as the accounting policies adopted under the previous FRS framework were already in line with the requirements of the MFRS framework. The transition to the MFRS framework has resulted in the following changes: MFRS 139 Financial Instruments: Recognition and Measurement ("MFRS 139") - Accounting policy on collective assessment allowance for loans, advances and financing ("loans") Prior to the transition to MFRS 139, the Bank Group had maintained its collective assessment allowance at 1.5% of total outstanding loans, net of individual assessment allowance, in line with Bank Negara Malaysia's transitional provisions under its Guidelines on Classification and Impairment Provisions for Loans/Financing. Upon the transition to MFRS 139 on 1 February 2012, these transitional provisions, which were allowed under the previous FRS framework, were removed and the Bank Group has applied the requirements of MFRS 139 in the determination of collective assessment allowance. Under MFRS 139, collective assessment is performed on loans which are not individually significant based on the incurred loss approach. Loans which are individually assessed and where there is no objective evidence of impairment are also included in the group of loans for collective assessment. These loans are pooled into groups with similar credit risk characteristics and the future cash flows for each group is estimated on the basis of the historical loss experience for such assets and discounted to present value. Collective assessment allowance is made on any shortfall in these discounted cash flows against the carrying value of the group of loans. This change in accounting policy has been accounted for retrospectively and has resulted in a decrease in the collective assessment allowance charged in the income statement and a writeback of collective assessment allowance to the opening retained profits and opening collective assessment allowance in the statement of financial position. BNM requires ELIBB to classify the write back of collective assessment allowance into regulatory reserve until the validation is completed. A summary of the financial impact of the change in accounting policy on the financial statements of the Bank Group are as follows: 31-Jan-12 1-Feb-11 Statement of Financial Position RM'000 RM'000 Loans, advances and financing - collective assessment allowance As previously stated 8,704 10,176 Effect of change in accounting policy (6,328) (8,471) As restated 2,376 1,705 Retained profits As previously stated 73,678 73,446 Effect of change in accounting policy 4,746 6,353 As restated 78,424 79,799 Statement of Comprehensive Income 1st 30-Apr-11 RM'000 Allowance for inpairment on loans, advances and financing - collective assessment allowance As previously stated 966 Effect of change in accounting policy (597) As restated 369 21
37 Changes in accounting policies (cont'd.) (b) Financial impact of changes in accounting policies In the preparation of the Group's and the Bank's opening MFRS statements of financial position, the amounts previously reported in accordance with the previous FRS framework have been adjusted for the financial effects of the adoption of the MFRS framework. A reconciliation of these changes is summarised in the following tables: (i) Statement of Financial Position Under the Effect of Under the FRS transition to MFRS Group Framework MFRS 139 Framework As at 31 January 2012 RM'000 RM'000 RM'000 ASSETS Cash and short-term funds 403,218 403,218 Deposits with financial institutions 20,631 20,631 Securities held-for-trading 360,985 360,985 Securities available-for-sale 673,363 673,363 Securities held-to-maturity 200,000 200,000 Derivative financial assets 6,688 6,688 Loans, advances and financing 550,242 6,328 556,570 Trade receivables 360,809 360,809 Other assets 26,697 26,697 Statutory deposit with Bank Negara Malaysia 27,165 27,165 Property, plant and equipment 21,714 21,714 Intangible assets 52,500 52,500 TOTAL ASSETS 2,704,012 2,710,340 LIABILITIES AND EQUITY LIABILITIES Deposits from customers 1,110,065 1,110,065 Deposits and placements of banks and other financial institutions 341,371 341,371 Derivative financial liabilities 57 57 Trade payables 482,878 482,878 Other liabilities 74,214 1,582 75,796 Amount owing to related companies 234-234 Deferred tax liabilities 7,470 7,470 TOTAL LIABILITIES 2,016,289 2,017,871 EQUITY Share capital 513,000 513,000 Reserves 174,723 4,746 179,469 TOTAL EQUITY 687,723 692,469 TOTAL LIABILITIES AND EQUITY 2,704,012 2,710,340 Net assets per share (RM) 1.34 1.35 22
37 Changes in accounting policies (cont'd.) (b) Financial impact of changes in accounting policies (cont'd.) (i) Statement of Financial Position (cont'd.) Under the Effect of Under the FRS transition to MFRS Group Framework MFRS 139 Framework As at 1 February 2011 RM'000 RM'000 RM'000 ASSETS Cash and short-term funds 389,669 389,669 Deposits with financial institutions 21,489 21,489 Securities held-for-trading 353,818 353,818 Securities available-for-sale 519,479 519,479 Securities held-to-maturity 70,000 70,000 Derivative financial assets 9,552 9,552 Loans, advances and financing 649,880 8,471 658,351 Trade receivables 482,122 482,122 Other assets 15,602 15,602 Statutory deposit with Bank Negara Malaysia 8,834 8,834 Investment in associated company - - Deferred tax assets 10,687 10,687 Property, plant and equipment 25,534 25,534 Intangible assets 52,500 52,500 TOTAL ASSETS 2,609,166 2,617,637 LIABILITIES AND EQUITY LIABILITIES Deposits from customers 1,075,123 1,075,123 Deposits and placements of banks and other financial institutions 201,008 201,008 Derivative financial liabilities - - Trade payables 576,600 576,600 Other liabilities 103,189 2,118 105,307 Amount owing to related companies 234 234 TOTAL LIABILITIES 1,956,154 1,958,272 EQUITY Share capital 513,000 513,000 Reserves 140,012 6,353 146,365 TOTAL EQUITY 653,012 659,365 TOTAL LIABILITIES AND EQUITY 2,609,166 2,617,637 Net assets per share (RM) 1.27 1.29 23
37 Changes in accounting policies (cont'd.) (b) Financial impact of changes in accounting policies (cont'd.) (ii) Reconciliation of Statement of Comprehensive Income Under the Effect of Under the FRS transition to MFRS Group Framework MFRS 139 Framework 1st Quarter ended 30 April 2011 RM'000 RM'000 RM'000 Revenue 43,710 43,710 Interest income 21,183 21,183 Interest expense (11,762) (11,762) Net interest income 9,421 9,421 Non-interest income 22,527 22,527 Other non-operating income 826 826 Net income 32,774 32,774 Operating expenses (18,338) (18,338) Operating profit 14,436 14,436 Share of loss of an associated company - - Writeback of losses on loans, advances and financing 966 (597) 369 Writeback of impairment allowance for bad and doubtful debts 1,785 1,785 Writeback of impairment loss Writeback of impairment loss 956 956 Profit before tax 18,143 17,546 Income tax expense (4,518) 149 (4,369) Profit after tax 13,625 13,177 Other comprehensive income: Net gain on available-for-sale financial assets 10,827 10,827 of other comprehensive income (2,707) (2,707) Other comprehensive income for the period, net of tax 8,120 8,120 Total comprehensive income for the period 21,745 21,297 Earnings per share ("EPS"): Sen Sen - basic / diluted * 2.66 2.57 (iii) Statement of Cash Flow There are no material differences between the statement of cash flow presented under the MFRSs and the statement of cash flow presented under FRSs. 24
37 Changes in accounting policies (cont'd.) (b) Financial impact of changes in accounting policies (cont'd.) (iv) Capital adequacy The adjustments to the financial statements of the Group as a result of the transition to the MFRS framework and the changes in accounting policies, as discussed above, also had consequential effects on the comparative capital adequacy ratios of the Bank. These are summarised below: As at 31 January 2012 As at 1 February 2011 As previously As restated: As previously As restated: stated: Under Under the stated: Under Under the the FRS MFRS the FRS MFRS Bank Framework Framework Framework Framework Tier 1 capital (RM'000) 663,054 663,054 637,622 637,622 Capital base (RM'000) 671,758 665,430 647,798 639,327 Tier 1 capital ratio 50.5% 50.5% 81.8% 81.8% Risk-weighted capital ratio 51.1% 50.6% 83.1% 82.0% 25