Risk Management Infrastructure

 

Overview

 

The Board of Directors, is ultimately responsible for the management of risk of the Bank. The Board ensures effective implementation of the risk management policies and determines the risk level, consistent with the risk appetite of the Bank. Given the size and complexity of its operations, the Board has established dedicated committees to assist in overseeing and managing total risks and specific risks faced by the Bank. This has provided the necessary infrastructure for managing risk within the Bank and for implementing various risk management policies and procedures.

The key committees involved in risk management are as follows:

 

Risk Management Committee (RMC)

The RMC, a board level committee, is responsible for the overall risk management of the Bank, including credit risk, operational risk, liquidity risk, and market risk and asset liability management within the Bank.

 

Credit Committee of the Board (CCB)

The CCB, also a board level committee, is main responsible to assist the Board in managing credit risk particularly in the area of loan financing sanctioning. The Committee has been vested with authority to approve loan/financing application of up to RM250 million. CCB would also evaluate, discussed and recommend to the Board of Directors on loan/financing application exceeding RM250 million.

 

Group Credit Committee (GCC)

GCC is the Management-level committee that decides on loan proposals and investments of up to its approving limit, i.e. RM40 million. Loans of higher limit will also be evaluated and discussed at this Committee and would be recommended higher approving authorities.

 

Executive Risk Management Committee (ERMC)

ERMC's primary role is to manage the interest rate risk, forex risk, liquidity risk and capital adequacy of the Bank. ERMC is mandated to derive with the most appropriate strategy for the Bank in terms of the mix of assets and liabilities to generate optimum levels of quality earnings and to guard against the potential consequences of market volatility, interest rate movement, liquidity constraints, foreign exchanges exposure and capital adequacy requirement in order to enhance or optimize risk-return. At this Committee, all Market Risk Indicator Limits approved by the Board are being monitored as well as ensuring the implementation of the various strategies related to the assets and liabilities management.