ASEAN Annual Report 2015 CATALYST PG 31 PG 64 PG 178 T18 STRATEGY DIGITAL INNOVATION DIVERSITY Successful recalibration of operations Regional launch of 1Platform allows us to Wins Gold Award for Inclusiveness and matched by 6% cost base reduction. seamlessly craft solutions across ASEAN. Diversity at NACRA 2015. Cover Rationale ASEAN Catalyst embodies the potential of this vibrant region of 650 million people, and our ability to ignite its growth. “ ASEAN is energetic, youthful and aspirational and it is a privilege to serve our home as a trusted and innovative provider of financial solutions.” OUR REPORTS CIMB Group Holdings Berhad produces a range of corporate reports to provide our different stakeholders with the information they need to fully understand the many levels of our business operations. Cross-referencing Annual Report (this Report) This is the primary source of information about Our stakeholders can learn about our strategy, our Group and gives an easy and detailed our businesses and performance, our approach overview of our financial and non-financial to governance and risk and our future goals. milestones and achievements for each year. It demonstrates our accountability and it strengthens the trust of our shareholders. Annual Financial Statements Throughout the year, we produce a range of These statements give our stakeholders a clear financial statements, including quarterly and full analysis of our financial affairs at the end financial statements and our full audited of the financial year. They are prepared annual financial results. in accordance with international financial reporting standards with the engagement of external auditors Sustainability Report The Sustainability Report is a recent addition It showcases our activities in the community, to our stable of reports. It presents a clear the workplace, the marketplace and the The above icons refer readers to information picture of what we are doing outside our environment. If we succeed in these areas, it will elsewhere in this financial operations. help to ensure our future sustainability. report, or in other reports that form part of the Group’s suite of reporting publications. Navigation icons Tells you where you can Tells you where you can find find more information in the more information online at Annual Report www.cimb.com ABOUT THIS REPORT As a leading provider of financial services, with presence in nine of the 10 ASEAN markets,C IMB Group Holdings Berhad understands that building a relationship based on trust and support with all our stakeholders is a business imperative. It is central to our continued success. Our Annual Report enhances our visibility and openness and gives us the opportunity to connect with our stakeholders. Scope and Boundary Unless we indicate otherwise, all the data relates to the Group, which includes our banking operations and our subsidiaries. If we have restated Our Annual Report for 2015 covers the period 1 January 2015 to 31 comparable information, this is highlighted. December 2015. It tells our stakeholders what we have been doing over the past year in all the geographical regions in which we operate. It also tells In preparing our report, we were guided by the requirements of local our stakeholders what we plan to do in the year ahead. and international statutory and reporting frameworks, including those of Bursa Malaysia. The report details our financial and non-financial performance during 2015 and showcases our achievements and the challenges we faced Materiality Determination during the year. Our Annual Report aims to present a balanced and accessible assessment It also contains forward looking statements on our strategies for our future of our strategy, performance, governance and prospects. success and what we expect of our financial condition and performance. Our report enables our stakeholders to stay abreast of our mid-term The issues and developments which we include in the report were and long-term direction and reach an informed decision about the health determined by a range of considerations such as quantitative and of our operations. qualitative criteria factors, issues likely to impact our ability to achieve our strategic objectives and remain sustainable, matters covered in Our report is particularly relevant for our stakeholders in the ASEAN reports presented to our Board of Directors, the risks identified by our markets of Malaysia, Indonesia, Singapore, Thailand, Brunei, Cambodia, risk management team and the interests of our key stakeholders. We also Myanmar, Vietnam and Laos. A diverse range of other stakeholders across consider factors that affect the economic and social environment in the the globe will also read our report with interest. countries and regions in which we do business. Our financial statements are independently audited and provide in-depth We are confident that our Annual Report for 2015 identifies and discloses disclosure and transparency on our financial performance. all material matters and our Group Audit Committee presents the report to the Board for approval. Statement of the Board of Directors of Approved by the Board of Directors and signed on behalf of the Board: CIMB Group Holdings Berhad The Board acknowledges its responsibility to ensure the integrity of the Annual Report. In the Board’s opinion, the report addresses all material issues and matters and fairly presents the Group’s performance. Nazir Razak Tengku Zafrul Aziz Chairman Group Chief Executive Officer/ Executive Director INSIDE THIS REPORT OVERVIEW 1 MANAGEMENT INSIGHTS 2015 2 BUSINESS REVIEW 2015 3 P8-23 P26-43 P44-67 008 Our Vision, Mission and Values 026 Message from the Chairman 044 Consumer Banking 009 CIMB Profile 047 Commercial Banking 049 Wholesale Banking 054 Group Asset Management & Investments 056 CIMB Islamic 059 Group Strategy 061 Business Enablers 030 Performance Review by Group Chief Executive Officer 010 How We Create Value 012 2015 Highlights 014 Financial Calendar 2015 015 Investor Relations 020 Corporate Milestones and Our Rich Heritage 022 Code of Ethics and Conduct 023 Commitment to Service Quality and Excellence Open to learn more about CIMB FINANCIAL INSIGHTS 2015 4 CORPorate GOVERNANCE 6 HIGHLIGHTS & ACHIEVEMENTS 2015 8 P70-84 P126-175 P190-213 070 Actual vs Targets for 2015 126 Chairman’s Statement on 190 Regional Notable Deals 071 Five Year Group Financial Highlights Corporate Governance 198 Notable Achievements 072 Simplified Group Statements of 127 Statement on Corporate Governance 202 Corporate Event Highlights Financial Position 146 Compliance with the Malaysian Code on 212 Media Highlights 073 Key Interest Bearing Assets and Liabilities Corporate Governance 2012 074 Value Added Statements 149 Statement on Risk Management 075 Quarterly Financial Performance and Internal Control 076 Capital Management 158 Risk Management 077 Dividends for 2015 166 Audit Committee Report ADDITIONAL INFORMATION 9 078 Credit Ratings 169 Terms of Reference of the Audit Committee 081 Balance Sheet Management 170 Shariah Committee Report 082 CIMB Share Information 083 Long Term Value Creation P214-235 084 2016 Quarterly Results Announcements 214 Shareholders’ Statistics 216 Additional Disclosures OUR PEOPLE 7 218 Internal Policies, Procedures and Guidelines OUR STRUCTURE 5 222 Top 10 Properties 223 Group Corporate Directory P178-189 226 Notice of Annual General Meeting 230 Statement Accompanying P85-125 178 Human Capital Growth and Notice of Annual General Meeting Talent Development Initiatives • Proxy Form 085 Corporate Information 184 Sustainability Statement 088 Boards of Major Subsidiaries 090 Corporate Profile 091 Corporate Structure 092 CIMB Group Organisation Structure 094 Leadership 096 Profile Board of Directors 107 Group Company Secretary 108 Group Shariah Committee 114 Group Management Committee We are banking on an ASEAN of tomorrow CAMBODIA VIETNAM MYANMAR LAOS BRUNEI THAILAND PHILIPPINES SINGAPORE Building the future together INDONESIA Malaysia CIMB Group Holdings Berhad 8 Overview Our Vision, Mission and Values OUR VISION, MISSION AND VaLUES OUR VISION OUR MISSION To be the To provide universal banking services as a high-performing, institutionalised leading ASEAN and integrated company located in company ASEAN and key markets beyond, and to champion the acceleration of ASEAN integration and the region’s links to the rest of the world OUR VALUES 1 3 5 CUSTOMER-CENTRIC ENABLING PEOPLE INTEGRITY We exist to serve our customers and we sell We empower and align our people to We are honest, respectful and professional products and services that our customers innovate and deliver value in their workplace in everything we do because integrity is the understand and value. as well as for the community they serve. founding value of CIMB Group. 2 4 HIGH PERFORMANCE STRENGTH IN DIVERSITY We work hard and we work strategically for We have respect for different cultures, we customers, staff and other stakeholders. value varied perspectives and we recognise diversity as a source of strength. Annual Report 2015 1 9 Overview CIMB Profile CIMB PROFILE CIMB Group is a leading ASEAN universal bank and one of the region’s foremost corporate advisors. It is also a world leader in Islamic finance. The Group is headquartered in Kuala Lumpur, Malaysia, and offers consumer banking, commercial banking, investment banking, Islamic banking and asset management products and services. It is the fifth largest banking group by assets in ASEAN and, as at the end of 2015, has over 40,000 staff and approximately