2019 Annual Report
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CIMB GROUP HOLDINGS BERHAD CIMB GROUP HOLDINGS BERHAD ANNUAL REPORT 2019 PERFORMANCE Strong balance sheet 195601000197 (50841-W) FORWARD23 and top line growth across the region Great strides through Page 18 Group-wide implementation with over 500 strategic projects Page 16 www.cimb.com SUSTAINABILITY Embedded economic, environmental and social considerations into our operations and lending policies Page 17 ANNUAL REPORT 2019 ANNUAL REPORT CUSTOMER TECHNOLOGY VENTURES & CENTRICITY & DATA OUR PEOPLE PARTNERSHIPS SUSTAINABILITY ADV Annual Report 2019 We have taken conscious effort to manage and minimise the environmental impact of our annual report and related processes. The total carbon footprint for There is approximately Printed with eco ink the 3 books of CIMB Annual made from higher Report 2019 is 25% reduction in percentage of vegetable 7.495 kgCO2e. We are paper used, oil to reduce emission of committed to reducing the volatile organic environmental impact of our 276,900 compounds (VOCs). annual report and will less sheets in the Contains low level of continue working to reduce printing and production chemical, thus less the amount of greenhouse of CIMB Annual pollution to the gases (GHG) emitted Report 2019. environment throughout throughout the entire Our covers showcase the printing process. designing and CIMB's focus on putting our printing process. customers at the heart of everything we do, future-proofing our business and shaping a sustainable Printed with carbon Paper sourced from Paper and printing future. Through adapting to neutral press responsibly wastes are being eco managed responsibly a dynamic and complex machines, that provide materials and managed forests handled to recycle environmental benefits. ecosystem, we strive to under and certified with and up-cycle materials Covers are printed on in order to reduce the create value and advance ISO14001:2015 250gsm Arctic Volume High burden on landfills. environmental White (FSC Mix) paper; our customers and society. View our Annual Report, Accounts and management system to minimise environmental Inner pages are printed on other information about impact. 100gsm Munken Polar CIMB Group Holdings Berhad at Rough (FSC Mix) paper. www.cimb.com Annual Report 2019 We have taken conscious effort to manage and minimise the environmental impact of our annual report and related processes. The total carbon footprint for There is approximately Printed with eco ink the 3 books of CIMB Annual made from higher Report 2019 is 25% reduction in percentage of vegetable 7.495 kgCO2e. We are paper used, oil to reduce emission of committed to reducing the volatile organic environmental impact of our 276,900 compounds (VOCs). annual report and will less sheets in the Contains low level of continue working to reduce printing and production chemical, thus less the amount of greenhouse of CIMB Annual pollution to the gases (GHG) emitted Report 2019. environment throughout throughout the entire Our covers showcase the printing process. designing and CIMB's focus on putting our printing process. customers at the heart of everything we do, future-proofing our business and shaping a sustainable Printed with carbon Paper sourced from Paper and printing future. Through adapting to neutral press responsibly wastes are being eco managed responsibly a dynamic and complex machines, that provide materials and managed forests handled to recycle environmental benefits. ecosystem, we strive to under and certified with and up-cycle materials Covers are printed on in order to reduce the create value and advance ISO14001:2015 250gsm Arctic Volume High burden on landfills. environmental White (FSC Mix) paper; our customers and society. View our Annual Report, Accounts and management system to minimise environmental Inner pages are printed on other information about impact. 100gsm Munken Polar CIMB Group Holdings Berhad at Rough (FSC Mix) paper. www.cimb.com about “In fulfilling our purpose of advancing customers and society, we remain committed to championing growth, with responsibility towards our multiple stakeholders across ASEAN. At CIMB Group, we are cognisant of the need to continuously monitor and respond to the evolving needs and expectations of our employees, customers, suppliers and partners, investors, as well as the regulators and policy-makers. Therefore, our Annual Report is also maturing in terms of our narratives for both shareholders and stakeholders alike. We are going beyond operational efficiencies and financial performance, to speak of our ability and perseverance to create value that is meaningful for everyone. ‘FutureForward’ is our commitment to future-proof our business, our people and our collective ASEAN aspirations.” REPORTING SCOPE AND BOUNDARIES MATERIALITY DETERMINATION This Annual Report covers our financial and non-financial All our Annual Reports present a balanced and accessible performance during the period 1 January 2019 to 31 December assessment of our strategy, performance, governance and 2019. prospects. Through this report, it is our sincere effort to keep our stakeholders The various issues and developments included in the 2019 edition abreast of key developments; programmes and initiatives; market were determined by a range of considerations, such as quantitative challenges and business solutions; our achievements; mid- to and qualitative criteria; issues likely to impact our ability to achieve long-term direction; and the overall health of operations in 2019 in strategic objectives and remain sustainable; matters covered in various geographical markets where we operate. reports presented to our Board of Directors; the risks identified by our risk management team; and the interests of our key The report also presents rich insights and forward-looking stakeholders. We also consider factors that affect the economic statements on financial position and performance in the year and social environment in various countries and regions where we ahead. conduct business. Our report is particularly relevant for our stakeholders in the ASEAN markets of Malaysia, Indonesia, Singapore, Thailand, Brunei, STATEMENT OF THE BOARD OF DIRECTORS OF Cambodia, Myanmar, Vietnam and Laos. A range of other CIMB GROUP HOLDINGS BERHAD stakeholders across the globe will also find our report informative. The Board acknowledges its responsibility to ensure the integrity Our financial statements are independently audited and provide of the Annual Report. In the Board’s opinion, the report addresses in-depth and transparent disclosure of our financial performance. all material issues and matters and fairly presents the Group’s performance for the year 2019. Unless we indicate otherwise, all the data presented relates to the Group, which includes our banking operations and our subsidiaries. Approved by the Board of Directors and signed on behalf of the Board: In preparing our report, we were guided by the requirements of local and international statutory and reporting frameworks, including those of Bursa Malaysia. Datuk Mohd Nasir Ahmad Tengku Zafrul Chairman Tengku Abdul Aziz Group Chief Executive Officer/ Executive Director CIMB GROUP HOLDINGS BERHAD View our Annual Report, Accounts and other information about CIMB Group Holdings Berhad at www.cimb.com what’s inside this report 2 About This Report PERFORMANCE REVIEW STRUCTURE & LEADERSHIP SUSTAINABILITY STATEMENT 68 Board of Directors 144 Sustainability Statement 70 Board of Directors Profile 74 Group Company Secretary’s Profile HIGHLIGHTS AND ACHIEVEMENTS 75 Corporate Structure 163 Regional Notable Deal 76 Board of Major 167 Notable Achievements 4 Message from the 32 Group Financial Review by Subsidiaries Chairman Group CFO 168 Corporate Event 78 Group Shariah Committee 38 Five-Year Group Financial Highlights Summary 79 Group Shariah Committee OVERVIEW OF CIMB GROUP 170 Media Highlights Profile 9 Overview 39 Five-Year Group Financial Highlights 82 Group Management 10 Profile and Presence STAKEHOLDER 40 Simplified Group 11 Key Highlights of 2019 84 Group Management INFORMATION Statements of Financial Profile 11 Business Highlights Position 172 Shareholders’ Statistics 89 Human Capital 41 Quarterly Financial 175 Internal Policies, 11 Financial Highlights Development Performance Procedures and 12 Corporate Milestones and 99 Group Organisation Guidelines Our Rich Heritage 42 Key Interest Bearing Structure Assets and Liabilities 181 Top 10 Properties of MANAGEMENT DISCUSSION 43 Value Added Statements CIMB Group CORPORATE GOVERNANCE AND ANALYSIS 44 Capital Management 182 Corporate Information 100 Chairman’s Statement on STRATEGIC REVIEW 45 Credit Ratings 184 Group Corporate Corporate Governance Directory 2019 48 Balance Sheet 101 Corporate Governance Management Overview Statement 49 Investor Relations 117 Additional Disclosures 55 Financial Calendar 120 Statement on Risk Management and Internal BUSINESS REVIEW Control 14 Group CEO’s Overview 56 Group Consumer Banking 129 Risk Management 24 Economic and Banking 58 Group Commercial Review & Outlook Banking 137 Audit Committee Report 26 Material Matters Impacting 60 Group Wholesale Banking 142 Board Shariah Committee Our Strategy Report 62 Group Transaction 27 Key Risks and Mitigation Banking 28 The Group’s Strategy 64 Group Ventures & Partnerships 66 Group Islamic Banking DATUK MOHD NASIR AHMAD Chairman DEAR STAKEHOLDERS, 2019 marked the completion of my one-full financial year as Chairman of CIMB Group. It was momentous for two reasons. First, the operating environment only grew more challenging,