Page 278 - Full Book_24.4.2021

NOTES TO THE
FINANCIAL STATEMENTS

for the financial year ended 31 december 2020 (continUed)

48 CAPITAL ADEQUACY
total capital and capital adequacy ratios of the Group have been computed based on bank negara malaysia (“bnm”)’s
capital adequacy framework for islamic banks (capital components) issued on 9 december 2020 and capital adequacy
framework for islamic banks (risk-Weighted assets) issued on 3 may 2019. the Group is required to meet minimum common
Equity Tier I (“CET I”), Tier I and Total Capital adequacy ratios of 4.5%, 6.0% and 8.0% respectively in 2020. To ensure that
banks build up adequate capital buffer outside period of stress, a Capital Conservation Buffer (“CCB”) of 2.5% above the
minimum capital adequacy was introduced by BNM. The CCB is maintained in the form of CET I capital at 2.5% starting
inteGrated annUal rePort 2020 therefore, the minimum regulatory capital adequacy ratios requirement for cet i capital ratio, tier i capital ratio and total
1 January 2019 onwards.

Capital ratio are 7.0%, 8.5% and 10.5% respectively starting year 2019 onwards. The Group has adopted the Standardised
approach for credit risk and market risk and the basic indicator approach for operational risk.
Similar to note 2.1(a)(iv), bnm has issued a memo on “additional measures to assists customers affected by covid-19
outbreak” which specifies (amongst others):
i. Drawdown of CCB of 2.5%; and
ii. Reduction in regulatory reserves held against expected losses to 0%.
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as a result, the minimum cet i capital ratio, tier i capital ratio and total capital ratio for the year ended 2020 are revised to
4.5%, 6.0% and 8.0% respectively (i.e. without CCB). However, BNM requires financial institutions to restore the minimum
regulatory requirements by 30 September 2021.
bimb holdinGS berhad 199701008362 (423858-X) cet i and tier i capital ratio 12.963 12.656
the capital adequacy ratios of the Group are set out below:
Group
2020
2019
%
%
18.071
total capital ratio
17.052
the components of cet i, tier i and tier ii capital of the Group:

2020 Group
2019
RM’000 RM’000
Tier I capital
Paid-up share capital 4,412,261 4,307,819
retained earnings 2,287,326 1,924,475
other reserves (965,212) (946,505)
less:
investment in subsidiary (99,053) (99,053)
deferred tax assets (1,531) (34,431)
Gain on financial instruments classified as fair value through
other comprehensive income (107,045) (107,543)
regulatory reserve – (25,000)

Total CET I and Tier I Capital 5,526,746 5,019,762