INTERIM FINANCIAL STATEMENTS FOR THE FINANCIAL HALF YEAR ENDED 30 JUNE PDF Free Download

FOR THE FINANCIAL HALF YEAR ENDED INTERIM FINANCIAL STATEMENTS 30 JUNE 2016 Registered Office Ground Floor, East Block Wisma Selangor Dredging 142-B Jalan Ampang 50450 Kuala Lumpur

INTERIM FINANCIAL STATEMENTS UNAUDITED STATEMENTS OF FINANCIAL POSITION AS AT 30 JUNE 2016 Group Bank Note 30 June 31 December 30 June 31 December 2016 2015 2016 2015 ASSETS Cash and short-term funds 142,380 127,806 142,380 127,806 Deposits and placements with banks and other financial institutions 9 271,185 287,090 271,185 287,090 Hedging financial instruments 10 6 1,291 6 1,291 Securities held-for-trading 11 5,091 5,510 5,091 5,510 Securities held-to-maturity 12 1,468,846 1,469,290 1,468,846 1,469,290 Financing and advances 13 4,967,784 4,983,507 4,967,784 4,983,507 Other assets 41,513 26,515 41,450 26,515 Statutory deposit with Bank Negara Malaysia 207,299 208,758 207,299 208,758 Investment properties 105,000 105,000 105,000 105,000 Property and equipment 11,936 10,631 11,936 10,631 Intangible assets 27,208 27,943 27,208 27,943 Deferred tax assets 62,051 62,051 62,051 62,051 Total Assets 7,310,299 7,315,392 7,310,236 7,315,392 - - LIABILITIES AND SHAREHOLDER'S EQUITY Liabilities Deposits from customers 14 5,378,382 5,110,626 5,378,382 5,110,626 Deposits and placements of banks and other - financial institutions 15 867,570 1,108,059 867,570 1,108,059 Hedging financial instruments 10 77 2 77 2 Bills and acceptances payable 4,516 18,737 4,516 18,737 Other liabilities 63,760 59,550 63,760 59,550 Subordinated Sukuk 268,405 285,928 268,405 285,928 Total Liabilities 6,582,710 6,582,902 6,582,710 6,582,902 - Shareholder's equity Share capital 1,000,000 1,000,000 1,000,000 1,000,000 Reserves (272,411) (267,510) (272,474) (267,510) Total Shareholder's Equity 727,589 732,490 727,526 732,490 Total Liabilities and Shareholder's Equity 7,310,299 7,315,392 7,310,236 7,315,392 COMMITMENTS AND CONTINGENCIES 22 940,608 1,314,720 940,608 1,314,720 CAPITAL ADEQUACY 25 CET 1 / Core capital ratio 15.457% 14.628% 15.456% 14.628% Risk-weighted capital ratio 23.295% 22.392% 23.293% 22.392% The Interim Financial Statements should be read in conjuction with the audited financial statements of the Group and the Bank for the year ended 31 December 2015. 1

INTERIM FINANCIAL STATEMENTS UNAUDITED STATEMENTS OF COMPREHENSIVE INCOME FOR THE 2ND QUARTER ENDED 30 JUNE 2016 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Group Note Revenue 93,496 93,663 187,616 186,279 Income derived from investment of depositors' funds and others 16 85,944 84,277 171,391 169,153 Income derived from investment of shareholder's funds 17 7,552 9,387 16,225 17,126 Allowance for impairment on financing 18 (406) (1,971) (665) (5,986) Other expenses directly attributable to the investment of the depositors' funds - (9) (4) (13) Total distributable income 93,090 91,684 186,947 180,280 Income attributable to depositors 19 (51,533) (50,059) (103,172) (99,100) Total Net Income 41,557 41,625 83,775 81,180 Personnel expenses (25,489) (18,203) (45,551) (35,330) Other overheads and expenditures (21,993) (20,423) (43,125) (42,189) Profit before zakat and taxation (5,925) 2,999 (4,901) 3,661 Zakat - - - - Taxation - - - - Net profit for the financial period, representing total comprehensive income for the financial period (5,925) 2,999 (4,901) 3,661 1 - The Interim Financial Statements should be read in conjuction with the audited financial statements of the Group and the Bank for the year ended 31 December 2015. 2

INTERIM FINANCIAL STATEMENTS UNAUDITED STATEMENTS OF COMPREHENSIVE INCOME FOR THE 2ND QUARTER ENDED 30 JUNE 2016 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Bank Note Revenue 93,382 93,664 187,458 186,279 Income derived from investment of depositors' funds and others 16 85,944 84,277 171,391 169,153 Income derived from investment of shareholder's funds 17 7,438 9,387 16,067 17,126 Allowance for impairment on financing 18 (406) (1,971) (665) (5,986) Other expenses directly attributable to the investment of the depositors' funds - (9) (4) (13) Total distributable income 92,976 91,684 186,789 180,280 Income attributable to depositors 19 (51,533) (50,059) (103,172) (99,100) Total Net Income 41,443 41,625 83,617 81,180 Personnel expenses (25,468) (18,203) (45,508) (35,330) Other overheads and expenditures (21,965) (20,423) (43,073) (42,189) Profit before zakat and taxation (5,990) 2,999 (4,964) 3,661 Zakat - - - - Taxation - - - - Net profit for the financial period, representing total comprehensive income for the financial period (5,990) 2,999 (4,964) 3,661 The Interim Financial Statements should be read in conjuction with the audited financial statements of the Group and the Bank for the year ended 31 December 2015. 3

INTERIM FINANCIAL STATEMENTS UNAUDITED STATEMENTS OF COMPREHENSIVE INCOME FOR THE 2ND QUARTER ENDED 30 JUNE 2016 Group Share Statutory Accumulated capital reserve losses Total At 1 January 2016 1,000,000 9,855 (277,365) 732,490 Total comprehensive income for the financial period - - (4,901) (4,901) Transfer to statutory reserve - - - - At 30 June 2016 1,000,000 9,855 (282,266) 727,589 Group At 1 January 2015 1,000,000 3,975 (283,244) 720,731 Total comprehensive income for the financial period - - 11,759 11,759 Transfer to statutory reserve - 5,880 (5,880) - At 31 December 2015 1,000,000 9,855 (277,365) 732,490 The Interim Financial Statements should be read in conjuction with the audited financial statements of the Group and the Bank for the year ended 31 December 2015. 4

INTERIM FINANCIAL STATEMENTS UNAUDITED STATEMENTS OF COMPREHENSIVE INCOME FOR THE 2ND QUARTER ENDED 30 JUNE 2016 Bank Non-Distributable Share Statutory Accumulated capital reserve losses Total At 1 January 2016 1,000,000 9,855 (277,365) 732,490 Total comprehensive income for the financial period - - (4,964) (4,964) Transfer to statutory reserve - - - At 30 June 2016 1,000,000 9,855 (282,329) 727,526 (2,483) Bank At 1 January 2015 1,000,000 3,975 (283,244) 720,731 Total comprehensive income for the financial period - - 11,759 11,759 Transfer to statutory reserve - 5,880 (5,880) - At 31 December 2015 1,000,000 9,855 (277,365) 732,490 The Interim Financial Statements should be read in conjuction with the audited financial statements of the Group and the Bank for the year ended 31 December 2015. 5

INTERIM FINANCIAL STATEMENTS UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS FOR THE 2ND QUARTER ENDED 30 JUNE 2016 CASH FLOWS FROM OPERATING ACTIVITIES Group Bank 30 June 30 June 30 June 30 June 2016 2015 2016 2015 (Loss) / Profit before zakat and taxation (4,901) 3,661 (4,964) 3,661 Adjustments for: Depreciation of property and equipment 2,673 3,164 2,673 3,164 Amortisation of intangible assets 5,877 6,448 5,877 6,448 Net gain on disposal of property,plant & equipment 10-10 - Allowance for impairment on financing 4,058 9,762 4,058 9,762 Bad debts on financing - Written off 483 46 483 46 Bad debts on financing - Recovered (3,876) (3,823) (3,876) (3,823) Allowance for doubtful debt - - - Unrealised loss on revaluation of - securities held-for-trading / investment properties 152 (144) 152 (144) Unrealised (gain)/loss from foreign exchange translations 179 4,280 179 4,280 Operating cashflow before workings capital changes 4,655 23,394 4,592 23,394 (Increase) / decrease in Operating Assets Deposits and placements with banks and other financial institutions 15,726 (23,164) 15,726 (23,164) Hedging financial instruments 1,018 1,535 1,018 1,535 Financing and advances 14,879 (377,874) 14,879 (377,874) Other assets (15,034) (5,985) (14,935) (5,985) Statutory deposit with Bank Negara Malaysia 1,459 (16,200) 1,459 (16,200) - (Decrease) / increase in Operating Liabilities - Deposits from customers 267,755 (142,575) 267,755 (142,575) Deposits and placements of banks and - other financial institutions (257,937) 320,220 (257,937) 320,220 Hedging financial instruments - - - - Bills and acceptances payable (14,220) 7,450 (14,220) 7,450 Other liabilities 4,959 17,273 4,923 17,273 Net cash (used in)/generated from operating activities 23,260 (195,926) 23,260 (195,926) 6

INTERIM FINANCIAL STATEMENTS UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS FOR THE 2ND QUARTER ENDED 30 JUNE 2016 CASH FLOWS FROM INVESTING ACTIVITIES Group Bank 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Purchase of property and equipment (3,988) (3,220) (3,988) (3,220) Purchase of intangible asset (5,142) (3,609) (5,142) (3,609) Proceeds from sale of fixed assets - - - Securities held-to-maturity 444 (42,771) 444 (42,771) Net cash used in investing activities (8,686) (49,600) (8,686) (49,600) CASH FLOWS FROM FINANCING ACTIVITY Issuance of Subordinated Sukuk - - - - Net cash generated from financing activities - - - - NET DECREASE IN CASH AND SHORT-TERM FUNDS 14,574 (245,526) 14,574 (245,526) Cash and short-term funds as at 1 January 127,806 358,672 127,806 358,672 CASH AND SHORT-TERM FUNDS 142,380 113,146 142,380 113,146 - The Interim Financial Statements should be read in conjuction with the audited financial statements of the Group and the Bank for the year ended 31 December 2015. 7

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134") AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 1. BASIS OF PREPARATION The unaudited condensed interim financial statements have been prepared in accordance with the applicable requirements of MFRS 134: Interim Financial Reporting in Malaysia issued by Malaysian Accounting Standards Board (MASB), Financial Reporting for Islamic Banking Institution policy issued by Bank Negara Malaysia (BNM), the provisions of the Companies Act, 1965 and Shariah requirements. The unaudited condensed interim financial statements should be read in conjunction with the audited financial statements for the year ended 31 December 2015. The explanatory notes attached to the consolidated condensed interim financial statements provide an explanation of events and transactions that are significant to an understanding of the changes in the financial position and performance of the Group since the year ended 31 December 2015. 2. ACCOUNTING POLICIES The significant accounting policies and methods of computation applied in the unaudited condensed interim financial statements are consistent with those adopted in the most recent audited financial statements for the year ended 31 December 2015, except for the adoption of the following: Annual improvements to MFRSs 2012-2014 Cycle Amendments to MFRS 116 and MFRS 138: Clarification of Acceptable Methods of Depreciation and Amortisation Amendments to MFRS 116 and MFRS 141: Agriculture : Bearer Plants Amendments to MFRS 10 and MFRS 128: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture MFRS 11: Accounting for acquisitions of interest in Joint Operations Amendments to MFRS 127: Equity Method in Separate Financial Statements Amendments to MFRS 101 : Disclosure initiatives Amendments to MFRS 10, MFRS 12, and MFRS 128 : Investment Entities: Applying the Consolidation Exception MFRS 14: Regulatory Deferral Accounts The adoption of MFRSs above do not have any financial impact on the Group and the Bank 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 the financial period beginning on or after 1 January 2018: MFRS 15: Revenue from Contracts with Customers Effective for the financial period beginning on or after 1 January 2018: MFRS 9: Financial Instruments (IFRS 9 Financial Instruments as issued by IASB in July 2014) 8

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134") AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA (CONTINUED) 3. AUDITORS REPORT ON PRECEDING ANNUAL FINANCIAL STATEMENTS The auditors report on the audited annual financial statements for the financial year ended 31 December 2015 was not qualified. 4. COMMENTS ABOUT SEASONAL OR CYCLICAL FACTORS The operations of the Group and the Bank were not materially affected by any seasonal or cyclical factors in the 2nd quarter ended 30 June 2016. 5. UNUSUAL ITEMS DUE TO THEIR NATURE, SIZE OR INCIDENCE There were no unusual items affecting the assets, liabilities, equity, net income or cash flows of the Group and the Bank in 2nd quarter ended 30 June 2016. 6. CHANGES IN ESTIMATE There were no changes in estimates of amounts reported in prior financial years that have a material effect in the 2nd quarter ended 30 June 2016. 7. DEBT AND EQUITY SECURITIES There were no issuances, cancellation, repurchases, resale or repayments of debt and equity securities in the 2nd quarter ended 30 June 2016. 8. DIVIDENDS PAID There were no dividends paid during the 2nd quarter ended 30 June 2016. 9

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 9. DEPOSITS AND PLACEMENTS WITH BANKS AND OTHER FINANCIAL INSTITUTIONS 30 June 31 December 2016 2015 Foreign financial institutions 271,185 287,090 10. HEDGING FINANCIAL INSTRUMENTS Notional Fair Value Amount Assets Liabilities 30 June 2016 Foreign currency forward contracts 4,021 6 77 31 Decemebr 2015 Foreign currency forward contracts 12,449 1,291 2 11. SECURITIES HELD-FOR-TRADING 30 June 31 December 2016 2015 At fair value Quoted securities: Unit Trust 5,091 5,510 - - 12. SECURITIES HELD-TO-MATURITY 30 June 31 December 2016 2015 At amortised cost Unquoted : Islamic government securities in Malaysia 1,417,961 1,418,390 Islamic private debt securities in Malaysia 50,885 50,900 1,468,846 1,469,290 - - 10

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 13. FINANCING AND ADVANCES (Continued) (b) Financing and advances analysed by type of customers are as follows: 30 June 31 December 2016 2015 Domestic non-bank financial institutions 307,972 381,724 Domestic business enterprise 1,300,082 1,196,725 Individuals 1,901,860 1,970,010 Foreign entities 1,552,464 1,530,241 5,062,378 5,078,700 - - (c) Financing and advances analysed by profit rate sensitivity are as follows: 30 June 31 December 2016 2015 Fixed rate: Corporate financing 1,583,647 1,536,454 Personal financing 644,355 669,611 SME financing 45,258 62,935 Home financing 14,173 15,505 Vehicle financing 77,467 76,865 Charge card 1,609 1,902 Shop-house financing 911 981 (d) Variable rate: Home financing 1,148,403 1,167,007 Shop-house financing 37,453 38,140 Corporate financing 1,509,102 1,509,300 5,062,378 5,078,700 - - Financing and advances analysed by maturity structure are as follows: 30 June 31 December 2016 2015 Due within three months 738,483 539,003 More than three months to one year 332,203 508,445 More than one year to five years 2,202,857 2,157,988 More than five years 1,788,835 1,873,264 5,062,378 5,078,700 - - (e) Financing and advances analysed by geographical distribution are as follows: 30 June 31 December 2016 2015 Malaysia 3,513,904 3,535,114 Saudi Arabia 1,509,102 1,509,301 Other Countries 39,372 34,285 5,062,378 5,078,700 0.00-12

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 13. FINANCING AND ADVANCES (Continued) (f) Financing and advances analysed by economic purpose are as follows: (g) 30 June 31 December 2016 2015 Purchase of securities 1,509,103 1,589,531 Working capital 1,326,192 1,321,999 Purchase of property - residential property 1,224,206 1,193,020 Personal use 644,355 669,611 Purchase of commercial complex 153,411 127,080 Purchase of vehicles 77,239 76,865 Others 74,062 32,923 Purchase of shop-house 26,609 48,809 Construction 17,922 15,611 Purchase of industrial buildings and factories 7,670 1,349 Charge card 1,609 1,902 5,062,378 5,078,700 - - Financing and advances analysed by sectors are as follows: 30 June 31 December 2016 2015 Household 1,924,315 1,970,026 Telecommunication 1,509,102 1,509,301 Manufacturing 561,032 308,497 Real estate, renting and business activities 325,377 242,975 Finance intermediation 321,468 434,643 Wholesale & Retail trade 281,085 291,254 Construction 126,736 261,389 Fishing, Operation of Fish Hatcheries, Fish Farms - 1,349 Transportation 8,066 19,944 Agriculture, hunting and related service activities 4,720 2,733 Other business 477 561 Electricity, gas and water supply - 35,941 Forestry, logging and related services activities - 87 5,062,378 5,078,700 - (h) Movements in impaired financing and advances 30 June 31 December 2016 2015 At 1 January 31,038 75,098 Impaired during the financial period / year 58,826 102,987 Reclassified as non impaired (24,788) (26,353) Recoveries (19,171) (74,701) Write-off (5,141) (45,993) 40,764 31,038 Ratio of net impaired financing and advances to gross 9,726 financing and advances less individual impairment 0.65% 0.46% Included in amount classified as impaired during the financial year is profit accrued on impaired financing of RM55,778,687 (2015: RM85,280,054). 13

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 13. FINANCING AND ADVANCES (Continued) (i) Movements in the allowances for impaired financing and advances Collective assessment allowance 30 June 31 December 2016 2015 At 1 January 87,732 86,569 Allowance made during the period / year (Note 18 (b)) 3,758 10,842 Amount written off (4,657) (9,679) Closing balance 86,833 87,732 - - As % of total gross financing and advances less individual impairment allowances 1.72% 1.73% Individual assessment allowance (j) (k) At 1 January 7,461 43,142 Allowance made during the financial year (Note 18(a)) 826 505 Amount recovered during the financial year (Note 18(a)) (526) (460) Amount written off - (35,726) Closing balance 7,761 7,461 - - Impaired financing analysed by geographical distribution are as follows: 30 June 31 December 2016 2015 Malaysia 40,764 31,038 40,764 31,038 - - Impaired financing analysed by economic purpose are as follows: 30 June 31 December 2016 2015 (l) Working capital 18,131 6,990 Personal use 11,838 11,041 Purchase of properties - residential 7,280 12,104 Purchase of shophouse 2,171 - Purchase of transport vehicles 1,121 703 Charge card 224 200 40,765 13,007 (1) - Impaired financing analysed by sector are as follows: 30 June 31 December 2016 2015 Household 22,450 24,048 Manufacturing 18,262 6,909 Construction 11 54 Other business 16 27 Wholesale & retail trade - - Real estate, renting and business activities - - Transportation 26-40,765 31,038 (1) 14

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 14. DEPOSITS FROM CUSTOMERS (a) By type of deposit 30 June 31 December 2016 2015 Savings deposits Qard 331,159 353,863 Demand deposits Qard 525,661 571,855 Mudarabah 123,195 128,992 Term deposit Commodity Murabahah 4,345,651 3,768,322 General investment account Mudarabah 15,714 26,259 Wakalah 36,269 260,278 (b) Other deposits 733 1,057 5,378,382 5,110,626 - - By type of customer 30 June 31 December 2016 2015 Business enterprises 1,482,003 1,722,484 Government and statutory bodies 856,389 595,530 Individuals 359,776 309,174 Others 2,680,214 2,483,438 5,378,382 5,110,626 - - (c) By maturity structure 30 June 31 December 2016 2015 Due within three months 3,524,245 3,480,352 More than three months to one year 1,788,331 1,628,799 More than one year to five years 65,806 1,475 5,378,382 5,110,626 - - 15. DEPOSITS AND PLACEMENTS OF BANKS AND OTHER FINANCIAL INSTITUTIONS 30 June 31 December 2016 2015 Non-Mudharabah Funds Licensed Islamic banks 535,970 318,836 Licensed financial institutions 331,600 789,223 867,570 1,108,059 - - 15

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 16. INCOME DERIVED FROM INVESTMENT OF DEPOSITORS' FUNDS AND OTHERS Group Group 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Income derived from investment of: (i) General investment deposits 208 409 625 904 (ii) Other deposits 85,736 83,868 170,766 168,249 85,944 84,277 171,391 169,153 - - (i) Income derived from investment of general investment deposits Group Group 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Finance income and hibah Financing and advances 200 405 607 894 Money at call and deposit with financial institutions 8 4 18 10 Total finance income and hibah 208 409 625 904 - - - (ii) Income derived from investment of other deposits Group Group 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Finance income and hibah Financing and advances 69,289 68,668 138,139 138,434 Securities held-to-maturity 14,627 14,530 29,308 28,408 Money at call and deposit with - financial institutions 1,819 669 3,317 1,351 Accretion of discount 1 1 2 56 85,736 83,868 170,766 168,249 - - - - 16

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 16. INCOME DERIVED FROM INVESTMENT OF DEPOSITORS' FUNDS AND OTHERS (Continued) Bank Bank 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Income derived from investment of: (i) General investment deposits 208 409 625 904 (ii) Other deposits 85,736 83,868 170,766 168,249 85,944 84,277 171,391 169,153 - (i) Income derived from investment of general investment deposits Bank Bank 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 (ii) Finance income and hibah Financing and advances 200 405 607 894 Money at call and deposit with financial institutions 8 4 18 10 Total finance income and hibah 208 409 625 904 - - - Income derived from investment of other deposits Bank Bank 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Finance income and hibah Financing and advances 69,289 68,668 138,139 138,434 Securities held-to-maturity 14,627 14,530 29,308 28,408 Money at call and deposit with - financial institutions 1,819 669 3,317 1,351 Accretion of discount 1 1 2 56 85,736 83,868 170,766 168,249 - - - - 17

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA - - 17. INCOME DERIVED FROM INVESTMENT OF SHAREHOLDERS' FUNDS Group Group 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Finance income and hibah Money at call and deposit with financial institutions 532 112 812 225 Total finance income and hibah 532 112 812 225 Other operating income - Net gain from foreign exchange translations - Realised 10,826 3,853 4,944 8,290 - Unrealised (8,549) (1,987) (179) (4,280) - Rental income 1,140 1,500 2,280 3,001 - Realised gain on gold 546 356 1,192 943 - Unrealised loss on revaluation of securities held-for-trading (152) (230) (152) 145 - Others 94 241 208 317 Other income - Service charges 1,502 1,806 3,201 3,749 - Commission received 1,613 3,736 3,919 4,736 7,552 9,387 16,225 17,126 - - - Bank Bank 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Finance income and hibah Money at call and deposit with financial institutions 532 112 812 225 Total finance income and hibah 532 112 812 225 Other operating income - Net gain from foreign exchange translations - Realised 10,826 3,853 4,944 8,290 - Unrealised (8,549) (1,987) (179) (4,280) - Rental income 1,140 1,500 2,280 3,001 - Realised gain on gold 546 356 1,192 943 - Unrealised loss on revaluation of securities held-for-trading (152) (230) (152) 145 - Others 67 241 181 317 Other income - Service charges 1,415 1,806 3,070 3,749 - Commission received 1,613 3,736 3,919 4,736 7,438 9,387 16,067 17,126 - - - 18

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 18. ALLOWANCE FOR IMPAIRMENT ON FINANCING Group Group 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Impaired financing and advances: (a) Individual assessment allowance - provided during the financial quarter (368) - 826 285 - written back (224) (331) (526) (513) (b) Collective assessment allowance - (write-back) / provided during financial quarter 2,962 4,207 3,758 9,991 2,370 3,876 4,058 9,763 (c) Bad debts on financing - recovered (1,962) (1,951) (3,876) (3,823) - written off (2) 46 483 46 406 1,971 665 5,986 - - Bank Bank 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Impaired financing and advances: (a) Individual assessment allowance - provided during the financial quarter (368) - 826 285 - written back (224) (331) (526) (513) (b) Collective assessment allowance - (write-back) / provided during financial quarter 2,962 4,207 3,758 9,991 2,370 3,876 4,058 9,763 (c) Bad debts on financing - recovered (1,962) (1,951) (3,876) (3,823) - written off (2) 46 483 46 406 1,971 665 5,986 - - 19

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES ON FINANCIAL REPORTING FOR LICENSED ISLAMIC BANKING INSTITUTIONS ISSUED BY BANK NEGARA MALAYSIA 19. INCOME ATTRIBUTABLE TO DEPOSITORS Group Group 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Deposits from customers - Non-Mudharabah 30,155 25,692 61,229 50,321 - Mudharabah 481 1,899 1,037 4,033 - Wakalah 694 16,636 2,980 33,546 31,330 44,227 65,246 87,900 Deposits and placements of banks and other financial institutions - Non-Mudharabah 20,203 5,832 37,926 11,200 51,533 50,059 103,172 99,100 - - - Bank Bank 2nd Quarter Ended Period Ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Deposits from customers - Non-Mudharabah 30,155 25,692 61,229 50,321 - Mudharabah 481 1,899 1,037 4,033 - Wakalah 694 16,636 2,980 33,546 31,330 44,227 65,246 87,900 Deposits and placements of banks and other financial institutions - Non-Mudharabah 20,203 5,832 37,926 11,200 51,533 50,059 103,172 99,100 20. SUBSEQUENT EVENTS There were no material events subsequent to the end of the reporting date that require disclosure or adjustments to the unaudited interim financial statements. 21. CHANGES IN THE COMPOSITION OF THE GROUP There were no changes in the composition of the Group since the last audited financial statements as at 31 December 2015. 20

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 22. COMMITMENTS AND CONTINGENCIES In the normal course of business, the Group made various commitments and incurred certain contingent liabilities with legal recourse to their customers. No material losses are anticipated as a result of these transactions. The commitments and contingencies and the related risk-weighted exposures of the Group as are as follows: 30 June 2016 31 December 2015 Credit Risk Credit Risk Principal equivalent weighted Principal equivalent weighted amount amount amount amount amount amount Direct credit substitute - - - - - - Transaction-related contingent items 322,330 161,165 126,024 318,178 159,089 125,117 Trade-related contingencies 8,367 1,673 1,609 39,897 7,979 7,173 Irrevocable commitments to extend credit: - Maturity not exceeding one year 490,734 98,147 98,147 651,076 130,215 130,188 - Maturity exceeding one year 113,136 53,443 49,800 288,828 141,282 129,656 Foreign exchange-related contracts 2,020 - - 4,292 - - Miscellaneous 4,021 4 4 12,449 1,427 1,426 940,608 314,432 275,584 1,314,720 439,992 393,559 - The Credit Equivalent and Risk Weighted for the Bank are computed in accordance with BNM's Capital Adequacy Framework for Islamic Banks (CAFIB): Standardised Approach for Credit and Market Risk, and Basic Indicator Approach for Operational Risk (Basel II) respectively. 23. CREDIT EXPOSURE ARISING FROM CREDIT TRANSACTIONS WITH CONNECTED PARTIES 30 June 2016 31 Dec 2015 Outstanding credit exposures with connected parties () 72,685 82,018 Percentage of outstanding credit exposures to connected parties as proportion of capital base 7.2% 8.0% Percentage of outstanding credit exposures to connected parties as proportion of total credit exposures 1.0% 1.1% Percentage of outstanding credit exposures with connected parties which is non-performing or in default 0.0% 0.0% The disclosure on Credit Transactions and Exposures with Connected Parties above is presented in accordance with paragraph 9.1 of Bank Negara Malaysia s revised Guidelines on Credit Transactions and Exposures with Connected Parties. 21

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (a) Overview The Group s risk management practice seeks to ensure that adequate financial resources are available for the development of the Group s businesses whilst managing its key areas of credit, market, liquidity and operational risks. (b) Financial instrument by category The table below provide an analysis of financial instruments categorised as follows: i. Financing and receivables (FR); ii. Securities held-to-maturity (HTM); iii. Securities held-for-trading (HFT); iv. Financial assets / liabilities at fair value through profit or loss (FVTPL) v. Other financial liabilities (Other FL). 30 June 2016 Carrying Other amount FR HFT HTM FVTPL FL Financial Assets Cash and short term funds 142,380 142,380 - - - - Deposits and placements with banks and other financial institutions 271,185 271,185 - - - - Hedging financial instruments 6 - - - 6 - Financing and advances 4,967,784 4,967,784 - - - - Securities held-to-maturity 1,468,846 - - 1,468,846 - - Securities held-for-trading 5,091-5,091 - - - Securities available-for-sale - - - - - - Other assets 41,513 41,513 - - - - 6,896,805 5,422,862 5,091 1,468,846 6 - Financial Liabilities Deposits from customers 5,378,382 - - - - 5,378,382 Deposits and placements of banks and other financial institutions 867,570 - - - - 867,570 Hedging financial instruments 77 - - - - 77 Bills and acceptances payable 4,516 - - - - 4,516 Other liabilities 63,760 - - - - 63,760 Subordinated Sukuk 268,405 - - - - 268,405 6,582,710 - - - - 6,582,710 31 Dec 2015 Carrying Other amount FR HFT HTM FVTPL FL Financial Assets Cash and short term funds 127,806 127,806 - - - - Deposits and placements with banks and other financial institutions 287,090 287,090 - - - - Hedging financial instruments 1,291 - - - 1,291 - Financing and advances 4,983,507 4,983,507 - - - - Securities held-to-maturity 1,469,290 - - 1,469,290 - - Securities held-for-trading 5,510-5,510 - - - Securities available-for-sale - - - - - - Other assets 26,514 26,514 - - - - 6,901,008 5,424,917 5,510 1,469,290 1,291 - Financial Liabilities Deposits from customers 5,110,626 - - - - 5,110,626 Deposits and placements of banks and other financial institutions 1,108,059 - - - - 1,108,059 Hedging financial instruments 2 - - - - 2 Bills and acceptances payable 18,737 - - - - 18,737 Other liabilities 59,550 - - - - 59,550 Subordinated Sukuk 285,928 - - - - 285,928 6,582,902 - - - - 6,582,902 22

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (i) Credit Risk management overview Credit risk is the potential loss of revenue as a result of defaults by borrowers or counterparties through the Group s and the Bank s lending, hedging, trading and investing activities. The primary exposure to credit risk arises through its financing and advances as well as financial transactions with counterparties including interbank money market activities and debt securities. The amount of credit exposure is represented by the carrying amounts of the assets in the statement of financial position. The management of credit risk is governed by credit policies and guidelines documenting the lending standards, discretionary power for financing approval, credit risk rating, collateral and valuation, review, and restructuring of problematic and delinquent financing. The management of counterparties are guided by counterparty limit, counterparty ratings, tenure and types of permissible transactions and these are subject to regular review. (ii) Maximum exposure to credit risk The maximum exposure to credit risk at the statement of financial position date is the amount on the statement of financial position as well as off balance sheet financial instruments, without taking into account of any collateral held or credit enhancements. For contingent liabilities, the maximum exposure to credit risk is the maximum that the Bank would have to pay if the obligations of the instruments issued are called upon. For credit commitments, the maximum exposure to credit risk is the full amount of the undrawn credit facilities granted to customers. 30 June 2016 31 Dec 2015 Credit risk exposure relating to on-balance sheet assets: Cash and short term funds 142,380 127,806 Deposits and placements with banks and other financial institutions 271,185 287,090 Hedging financial instruments 6 1,291 Securities held-for-trading 5,091 5,510 Securities held-to-maturity 1,468,846 1,469,290 Financing and advances 4,967,784 4,983,507 Other assets 6,972 6,979 6,862,264 6,881,473 Credit risk exposure of off-balance sheet items: Commitment and contingencies 940,608 1,314,720 Total maximum credit risk exposure 7,802,872 8,196,193 The financial effect of collateral (quantification of the extent to which collateral and other credit enhancements mitigate credit risk) held for financing and advances as at 30 June 2016 for the Bank is 34.0% (31 Dec 2015: 33.0%). The financial effect of collateral held for the other financial assets is not significant. (iii) Credit Risk Concentration A concentration of credit risk exists when a number of counterparties are engaged in similar activities and have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic and other conditions. The Group analysed the credit risk concentration by industry and geographic segments in which the customer is engaged. 23

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (Continued) (iii) Credit Risk Concentration (Continued) (a) Credit Risk - Credit Risk Concentration - By Industry Analysis Agricultural, manufacturing, Transport, utility, tele- research & communication, development, education wholesale & Government and other retail trade, Construction Motor Other and Central Financial business hotel and and Real Residential vehicle consumer Banks services services restaurant estate mortgages financing financing Total 30 June 2016 Short term funds 131 142,248 - - - - - - 142,380 Deposits and placements with banks and other financial institutions - 271,185 - - - - - - 271,185 Hedging financial instruments - 6 - - - - - - 6 Securities held-for-trading - 5,091 - - - - - - 5,091 Securities held-to-maturity 1,014,876 403,085-50,885 - - - - 1,468,846 Net financing and advances - 240,865 1,517,645 846,837 452,113 1,162,576 75,256 672,492 4,967,784 Statutory deposits with BNM 207,299 - - - - - - - 207,299 Other assets - - 6,972 - - - - - 6,972 Total 1,222,307 1,062,481 1,524,617 897,722 452,113 1,162,576 75,256 672,492 7,069,564 24

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (continued) (iii) Credit Risk Concentration (Continued) (a) Credit Risk - Credit Risk Concentration - By Industry Analysis Agricultural, manufacturing, Transport, utility, tele- research & communication, development, education wholesale & Government and other retail trade, Construction Motor Other and Central Financial business hotel and and Real Residential vehicle consumer Banks services services restaurant estate mortgages financing financing Total 31 Dec 2015 Short term funds 9,753 118,053 - - - - - - 127,806 Deposits and placements with banks and other financial institutions - 287,090 - - - - - - 287,090 Hedging financial instruments - 1,291 - - - - - - 1,291 Securities held-for-trading - 5,510 - - - - - - 5,510 Securities available-for-sale - - - - - - - - - Securities held-to-maturity 1,015,213 403,176-50,901 - - - - 1,469,290 Net financing and advances - 353,441 1,529,807 639,860 504,364 1,182,512 74,882 698,641 4,983,507 Statutory deposits with BNM 208,758 - - - - - - - 208,758 Other assets - - 6,979 - - - - - 6,979 Total 1,233,724 1,168,561 1,536,786 690,761 504,364 1,182,512 74,882 698,641 7,090,231 25

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (Continued) (iii) Credit Risk Concentration (Continued) (b) Credit Risk - Credit Risk Concentration - By Geographical Analysis Saudi Other Malaysia Arabia countries Total 30 June 2016 Cash and short term funds 47,400 69,137 25,843 142,380 Deposits and placements with banks and other financial institutions - - 271,185 271,185 Hedging financial instruments - - 6 6 Securities held-for-trading 5,091 - - 5,091 Securities held-to-maturity 1,468,846 - - 1,468,846 Net financing and advances 3,419,310 1,509,102 39,372 4,967,784 Statutory deposits with BNM 207,298 - - 207,298 Other assets 6,972 - - 6,972 Total 5,154,918 1,578,239 336,407 7,069,564 Saudi Other Malaysia Arabia countries Total 31 Dec 2015 Cash and short term funds 47,855 70,838 9,114 127,806 Deposits and placements with banks and other financial institutions - - 287,090 287,090 Hedging financial instruments - - 1,291 1,291 Securities held-for-trading 5,510 - - 5,510 Securities held-to-maturity 1,469,290 - - 1,469,290 Net financing and advances 3,535,114 1,509,301 34,285 5,078,700 Statutory deposits with BNM 208,758 - - 208,758 Other assets 6,979 - - 6,979 Total 5,273,506 1,580,139 331,780 7,185,424 26

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (Continued) (iv) Collateral The main types of collateral obtained by the Group and the Bank to mitigate credit risk are as follows: for personal housing financing : mortgages over residential properties for commercial property financing : charges over the properties being financed for vehicle financing : charges over the vehicles financed for other financing : charges over business assets such as premises, inventories, trade receivables or deposits There are no assets held by the Bank as at 30 June 2016 as a result of taking possession of collaterals held as securities. Repossessed properties are made available for sale in an orderly fashion, with the proceeds used to reduced or repay the outstanding indebtedness. The Bank generally does not occupy the premises repossessed for its business use. (v) Credit quality of financial assets For the purposes of disclosure relating to MFRS 7, all financial assets are categorized into the following: - neither past due nor impaired - past due but not impaired - impaired The Bank assesses credit quality of financing and advances using internal rating techniques tailored to the various categories of products and counterparties. These techniques have been developed internally and combine statistical analysis with credit officers' judgment. Internal ratings - Investment grade - Non-Investment grade Description Strong(est) credit quality which associated with general standards of investment grade as per defined by international rating agency such as Standard and Poor's (S&P), Moody's, Fitch, and Japan Credit Rating Agency (JCR). Weaker credit quality which associated with general standards of non-investment grade as per defined by international rating agency such as Standard and Poor's (S&P), Moody's, Fitch, and Japan Credit Rating Agency (JCR). The credit quality of financial assets other than financing and advances are determined based on the ratings of counterparties as defined by Moody s or equivalent ratings of other international rating agencies as defined below: - AAA to AA3 - A1 to A3 - Baa1 to Baa3 - P1 to P3 - Non rated 27

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (continued) (vi) Credit quality of financial assets - net financing and advances 30 June 2016 31 Dec 2015 Neither past due nor impaired 4,847,112 4,887,998 Past due but not impaired 174,501 159,664 Impaired 40,765 31,038 Gross financing and advances 5,062,378 5,078,700 Less: Collective impairment allowance (86,833) (87,732) Individual impairment allowance (7,761) (7,461) Net financing and advances 4,967,784 4,983,507 The ageing of financing and advances as at the end of the financial period / year are as follows: 30 June 2016 31 Dec 2015 Current 4,847,112 4,887,998 Past due 1-30 days 123,114 118,155 Past due 31-90 days 51,387 41,508 Past due more than 90 days 40,765 31,038 5,062,378 5,078,700 Collective impairment (86,833) (87,732) Individual impairments (7,761) (7,461) Net financing and advances 4,967,784 4,983,507 28

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (Continued) (vii) Credit quality of financial assets - securities portfolio and other financial assets Deposits and placement of banks Financial and other Hedging assets/ Statutory Short term financial financial investments deposit Other funds institutions instruments portfolios with BNM assets 30 June 2016 Neither past due nor impaired 142,380 271,185 6 1,473,937 207,299 6,972 142,380 271,185 6 1,473,937 207,299 6,972 31 Dec 2015 Neither past due nor impaired 127,806 287,090 1,291 1,474,800 208,758 6,979 127,806 287,090 1,291 1,474,800 208,758 6,979 (a) Analysed by rating agency designation are as follows: Deposits and placement of banks Financial and other Hedging assets/ Statutory Short term financial financial investments deposit Other funds institutions instruments portfolios with BNM assets 30 June 2016 AAA to A- 97,713 - - 1,417,961 - - BBB+ to B- 608 - - - - - Unrated 44,059 271,185 6 55,976 207,299 6,972 142,380 271,185 6 1,473,937 207,299 6,972 31 Dec 2015 AAA to A- 285,189 - - 1,418,459 - - BBB+ to B- 36,391 - - - - - Unrated 37,092 233,115 1,630 12,725 216,364 7,961 358,672 233,115 1,630 1,431,184 216,364 7,961 29

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (Continued) (viii) Credit quality of impaired financial assets (a) Impaired financial assets analysed by geographic purpose are as follows: Financial assets/ Financing & investments advances portfolios Total 30 June 2016 Malaysia 40,765-40,765 40,765-40,765 31 Dec 2015 Malaysia 31,038-31,038 31,038-31,038 (b) Impaired financial assets analysed by industry sector are as follows: Financial assets/ Financing & investments advances portfolios Total 30 June 2016 Household 22,450-22,450 Construction 11-11 Manufacturing 18,262-18,262 Wholesale & retail trade - - - Other business 16-16 Real estate, renting and business activities 26-26 40,765-40,765 Financial assets/ Financing & investments advances portfolios Total 31 Dec 2015 Household 24,048-24,048 Construction 54-54 Manufacturing 6,909-6,909 Wholesale & retail trade - - - Other business 27-27 Real estate, renting and business activities - - - 31,038-31,038 30

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (c) Credit Risk Management (Continued) (ix) Reconciliation of allowance The movements in the allowance for impairment losses of financing and advances during the financial period / year are as follows: 30 June 2016 31 Dec 2015 At 1 January 95,193 129,711 Impairment loss recognised during the year 4,584 11,347 Impairment loss reversed (526) (460) Impairment written-off (4,657) (45,405) Closing balance 94,594 95,193 (i) Profit rate sensitivity analysis 30 June 2016 31 Dec 2015 Impact on Impact on profit after Impact on profit after Impact on tax equity tax equity + 100 basis points (5,503) (81,856) (5,516) (94,475) - 100 basis 5,503 81,856 5,516 94,475 points (ii) Foreign currency sensitivity analysis The foreign currency sensitivity represents the effect of the appreciation or depreciation of the foreign currency rates on the consolidated currency position, while other variables remain constant. 30 June 2016 31 Dec 2015 Impact on Impact on profit after Impact on profit after Impact on tax equity tax equity +5% 107 107 172 172-5% (107) (107) (172) (172) 31

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (d) Market Risk Management (continued) Market risk sensitivity assessment is based on the changes in key variables; such as profit rates while all other variables remain unchanged. The sensitivity factors used are assumptions based on parallel shifts in the key variables and the impact on the re-priced mismatches of assets and liabilities position of the bank. (i) Profit Rate Risk The Group is exposed to various risks associated with the effects of fluctuations in the prevailing levels of yield/profit rate on its financial position. The rate of return risk is the potential impact of market factors affecting rates on returns in comparison with the expected rates of return for investment account holders. Yield/profit rate is monitored and managed by the ALCO to protect the income of its operations. The assets and liabilities at carrying amount are categorised by the earlier of the next contractual repricing dates and maturity dates as follows: Non-trading book Group Average Up to 1 > 1-3 > 3-12 1-5 Non-profit Trading effective month months months years > 5 years sensitive book Total profit rate 30 June 2016 % Assets Cash and short term funds 62,806 - - - - 79,574-142,380 0.56 Hedging financial instruments - - - - - - 6 6 - Deposit and placement with other FI / Institutions - 42,944 225,461 - - 2,781-271,186 2.42 Securities held-for-trading - - - - - - 5,091 5,091 - Securities held-to-maturity - - - - 1,448,570 20,276-1,468,846 3.99 Financing and advances - performing 1,460,783 435,828 330,011 2,175,951 594,237 24,803-5,021,613 - Non performing (1) - - - - - (53,829) - (53,829) Other assets (2) - - - - - 455,006-455,006 Total assets 1,523,589 478,772 555,472 2,175,951 2,042,807 528,611 5,097 7,310,299 5.58 32

EXPLANATORY NOTES PERSUANT TO MALAYSIAN FINANCIAL REPORTING STANDARDS 134 ( MFRS 134 ) AND GUIDELINES 24. FINANCIAL RISK MANAGEMENT (Continued) (d) Market Risk Management (continued) Group (Continued) Average Up to 1 > 1-3 > 3-12 1-5 Non-profit Trading effective (Continued) month months months years > 5 years sensitive book Total profit rate 30 June 2016 (Continued) % Liabilities Deposits from customers 1,229,875 1,567,241 1,772,514 65,806-742,946-5,378,382 3.66 Deposits and placements of banks and other financial institutions 300,133 184,228 380,000 - - 3,209-867,570 3.61 Hedging financial instruments - - - - - - 77 77 - Bills and acceptance payable - - - - - 4,516-4,516 - Other liabilities - - - - - 63,760-63,760 - Subrodinated Sukuk - - - - 268,405 - - 268,405 Total liabilities 1,530,008 1,751,469 2,152,514 65,806 268,405 814,431 77 6,582,710 Shareholders' fund - - - - - 727,589-727,589 Total liabilities and shareholders' fund 1,530,008 1,751,469 2,152,514 65,806 268,405 1,542,020 77 7,310,299 - On-balance sheet profit sensitivity gap (6,419) (1,272,697) (1,597,042) 2,110,145 1,774,402 (1,013,409) 5,020 Off-balance sheet profit sensitivity gap - - - - - 940,608 - Total profit sensitivity gap (6,419) (1,272,697) (1,597,042) 2,110,145 1,774,402 (72,801) 5,020 Note: (1) (2) This is arrived at after deducting the collective and individual impairment allowance from the outstanding gross non performing financing. Other assets include property and equipment, deferred tax assets and statutory deposits with Bank Negara Malaysia. 33

INTERIM FINANCIAL STATEMENTS FOR THE FINANCIAL HALF YEAR ENDED 30 JUNE 2016