OTHER STATUTORY INFORMATION (CONTINUED) Items of an unusual nature The results of the operations of the Group and of the Bank for the financial year were not, in the opinion of the Directors, substantially affected by any item, transaction or event of a material and unusual nature. There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature, likely to affect substantially the results of the operations of the Group or of the Bank for the current financial year in which this report is made. Compliance with Bank Negara Malaysia’s policy document on financial reporting In the preparation of the financial statements, the Directors have taken reasonable steps to ensure that the preparation of the financial statements of the Group and of the Bank are in compliance with the Bank Negara Malaysia’s Policy Documents on Financial Reporting for Islamic Financial Institutions. Business Plan, Strategy and Future Outlook The global Gross Domestic Product (GDP) for 2025 is expected to be moderate at 3.2%. Global GDP faces downside risks due to persistent geopolitical tensions, inflationary pressures, and climate change. Domestically, Malaysian economy is projected to remain resilient, with GDP growth estimated between 4.5% to 5.5% for 2025, anchored by strong domestic demand and continued recovery in external demand according to Economic Outlook 2025 presented by the Prime Minister during the Budget 2025 presentation in October 2024. Inflation is expected between 2.0% to 3.5% however, further subsidy rationalisation measures could increase the risk of rising inflation as the targeted RON95 petrol constitutes 5.5% of Consumer Price Index (CPI) compared to diesel’s 0.2%. This may reduce household disposable income and potentially constrain consumption. However, more resilient labour market conditions are expected with the unemployment rate anticipated to be at 3.1%, supported by government’s cash transfers and strong tourism recovery. The Bank and the Group remains steadfast and continues its focus to incorporate the principles of Shariah, Value-Based Intermediation (VBI) and ESG considerations whilst mobilising its 6 strategic pillars to support and govern the Group’s agenda namely Sustainable Prosperity, Value Based Culture, Community Empowerment, Customer Centricity, Real Economy and Digitalisation. In focusing the efforts on the final year of LEAP25, the Group has identified five focus areas – Customer Acquisition, Monetising Strengths, Banking Model, Capitalising Opportunities and Growth Strategy, anchoring the FY2025 business plan while laying the foundation for beyond 2025. Accelerating growth in 2025 will remain a key priority for the Group amidst global market uncertainties. By implementing disciplined cost measures and optimising resource allocation, the Group aims to stabilise its cost-to-income ratio in 2025. The Group will focus on implementing outcome-driven initiatives that deliver meaningful impact, leveraging advanced data analytics, resilient systems, and robust platforms. Empowered by a skilled workforce adept in agile process frameworks, the Group will embrace digital solutions, drive innovation, and utilise data-driven insights to enhance customer engagement and fuel business growth. This will be achieved via continuous investment in technology infrastructure. Bank Islam Malaysia Berhad ◆ Integrated Annual Report 2024 270 Directors’ Report for the financial year ended 31 December 2024
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