Annual Report
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Bumiputra-Commerce Holdings Berhad (50841-W) (Formerly known as Commerce Asset-Holding Berhad) Transforming for growth ANNUAL␣ REPORT␣ 2005 Our strategic transformation is in line with our aim of becoming a leading integrated financial services group in the region, whilst maximising shareholder value. Corporate London Bumiputra-Commerce Holdings Berhad (BCHB) (formerly known as Commerce Asset-Holding Berhad) Group is a leading financial services player in Malaysia with a growing presence in South East Asia. BCHB has been listed on Bursa Malaysia Securities Berhad since 1987. As at 30 December 2005, it is the eighth largest company by market capitalisation amounting to RM15.698 billion. In 2005, the Group undertook a significant step towards creating a universal banking platform through the internal restructuring of its investment and commercial banking arms, namely CIMB Berhad and Bumiputra-Commerce Bank Bhd. The Group is involved in the full suite of investment banking and commercial banking services. From a regional perspective, BCHB has a 65% stake in Indonesia’s seventh largest bank, P.T. Bank Niaga and in 2005, CIMB acquired the stock broking businesses of GK Goh Holdings Limited, Singapore. The Group is also involved in venture capital, life & general insurance and takaful business. As for the insurance business, a new insurance holding company, namely Commerce International Group Berhad was established at the end of 2005 to facilitate shared services and provide overall strategic direction for the Group’s insurance and takaful businesses. Profile Tokyo Hong Kong Bangkok Malaysia Brunei Singapore Jakarta bumiputra-commerce holdings berhad (50841-W) 1 (Formerly known as Commerce Asset-Holding Berhad) contents Notice of Annual General Meeting 2 Corporate Social Responsibility 62 • The Group that Cares 64 Statement Accompanying • BCHB Group 2005 Notice of Annual General Meeting 4 Calendar of Corporate Events 69 Achievements and Awards 10 Corporate Governance 76 Corporate Information 12 • Statement on Corporate Governance 78 • Group Corporate Structure 14 • Statement on Internal Control 84 • Corporate Data 15 • Audit Committee Report 86 • Board of Directors 16 • Risk Management 88 • Profile of the Directors 18 • Additional Compliance Information 95 • Senior Management 22 • Statement of Directors’ Responsibility 95 • Profile of the Senior Management 23 • Financial Calendar 96 • Profile of Directors for Major Reports and Financial Statements 97 Operating Units of the Group 24 Share Performance 258 Performance Review 30 • Five Year Group Shareholders’ Statistics 259 Financial Highlights 32 Properties of the Group 261 • Group Financial Highlights 34 • Group Performance 35 The Commerce Group 269 • Chairman’s Message 37 Group Directory 272 • Key Business Review 45 Directory of BCB Branches 275 – BCB Group 46 – CIMB Group 50 Directory of Bank Niaga Branches 285 – Bank Niaga 53 Proxy Form • Strategic Transformation 56 • Economic Outlook 59 • Investor Relations 61 2 bumiputra-commerce holdings berhad (50841-W) (Formerly known as Commerce Asset-Holding Berhad) Notice of Annual General Meeting NOTICE IS HEREBY GIVEN that the Forty-Ninth (49th) Annual General Meeting of Bumiputra-Commerce Holdings Berhad will be held at Banquet Hall, Kuala Lumpur Convention Centre, Kuala Lumpur City Centre, Kuala Lumpur, on Thursday, 27 April 2006 at 9.30 a.m. to transact the following businesses:- AGENDA the Company at any time until the conclusion of the next Annual General Meeting and upon such terms and conditions 1. To receive and adopt the Audited Financial Statements for and for such purposes as the Directors may in their absolute the year ended 31 December 2005 and the Reports of the Directors and Auditors thereon. Resolution 1 discretion deem fit provided that the aggregate number of shares to be issued does not exceed 10 percent of the issued share capital of the Company for the time being, subject 2. To declare a first and final dividend of 10.0 sen less income tax and special dividend of 5.0 sen less income tax for the always to the approval of all the relevant regulatory bodies being obtained for such allotment and issue.” year ended 31 December 2005 as recommended by the Directors payable on 29 May 2006 to shareholders registered in the Company’s books at the close of business on 8 May 8. Proposed renewal of the authority for the purchase of own ordinary shares. Resolution 12 2006. Resolution 2 “THAT, subject to the Companies Act, 1965 (as may be amended, modified or re-enacted from time to time), the 3. To re-elect the following Directors who retire in accordance Company’s Articles of Association and the requirements of with the Company’s Articles of Association: the Bursa Malaysia Securities Berhad (“Bursa Securities”) and 3.1 YBhg Tan Sri Dato’ Mohd Desa Pachi Resolution 3 approvals of all relevant governmental and/or regulatory 3.2 YBhg Tan Sri Datuk Asmat Kamaludin Resolution 4 authorities, the Company be and is hereby authorised to 3.3 YBhg Dato’ Mohd Salleh Mahmud Resolution 5 purchase such number of ordinary shares of RM1.00 each in 3.4 YBhg Dato’ Anwar Aji Resolution 6 the Company (“Proposed Shares Buy-Back”) as may be 3.5 En Mohd Shukri Hussin Resolution 7 determined by the Board of Directors of the Company from 3.6 YBhg Dato’ Mohamed Nazir Razak Resolution 8 time to time through Bursa Securities upon such terms and conditions as the Board of Directors may deem fit and 4. To approve the payment of Directors’ fees amounting to expedient in the interest of the Company provided that the RM90,000 per director per annum in respect of the year ended aggregate number of ordinary shares purchased and/or held 31 December 2005. Resolution 9 pursuant to this resolution does not exceed ten per centum (10%) of the total issued and paid-up share capital of the 5. To re-appoint PricewaterhouseCoopers as Auditors of the Company at any point in time and an amount not exceeding Company and to authorise the Board of Directors to fix their the total retained profits of approximately RM683.6 million remuneration. Resolution 10 and/or share premium account of approximately RM2,038.4 million of the Company based on the audited financial 6. To transact any other ordinary business. statements for the financial year ended 31 December 2005 be allocated by the Company for the Proposed Shares Buy- As special business: Back AND THAT the ordinary shares of the Company to be To consider and if thought fit to pass the following Ordinary purchased are proposed to be cancelled and/or retained as Resolutions: treasury shares and subsequently be cancelled, distributed 7. Proposed renewal of the authority for the issue of new ordinary as dividends or re-sold on Bursa Securities AND THAT the shares. Resolution 11 Board of Directors of the Company be and are hereby “THAT pursuant to Section 132D of the Companies Act, 1965, empowered generally to do all acts and things to give effect the Directors be and are hereby authorised to issue shares in to the Proposed Shares Buy-Back AND THAT such authority bumiputra-commerce holdings berhad (50841-W) 3 (Formerly known as Commerce Asset-Holding Berhad) NOTICE OF ANNUAL GENERAL MEETING shall commence immediately upon passing of this ordinary Further notice is hereby given that a depositor shall qualify for resolution until: entitlement only in respect of: i. the conclusion of the next AGM of BCHB in 2007 at which a. Shares deposited into the depositor’s securities accounts time such authority shall lapse unless by ordinary before 12.30 p.m. on 4 May 2006 (in respect of shares which resolution passed at that meeting, the authority is are exempted from mandatory deposit). renewed either unconditionally or subject to conditions; b. Shares transferred into the depositor’s securities accounts ii. the expiration of the period within which the next AGM before 4.00 p.m. on 8 May 2006 in respect of ordinary transfer. after that date is required by law to be held; or c. Shares bought on Bursa Securities on a cum entitlement basis iii. revoked or varied by ordinary resolution passed by the according to the rules of the Bursa Securities. shareholders of the Company in a general meeting; Shareholders are reminded that pursuant to the Securities Industry whichever is the earlier but not so as to prejudice the (Central Depositories) (Amendment) (No. 2) Act, 1998 which came completion of purchase(s) by the Company before the into force on 1 November 1998, all shares not deposited with aforesaid expiry date and, in any event, in accordance with Malaysian Central Depository Sdn Bhd by 12.30 p.m. on the provisions of the guidelines issued by Bursa Securities 1 December 1998 and not exempted from mandatory deposit, have and/or any other relevant authorities.” been transferred to the Minister of Finance (“MoF”). Accordingly, the payment for such undeposited shares will be paid to MoF. NOTICE OF BOOKS CLOSURE Notice is hereby given that the register of members will be closed By Order of the Board from 9 May 2006 to 10 May 2006 (both dates inclusive) to determine shareholders entitlement to the dividend payment. The dividend, if approved will be paid on 29 May 2006 to shareholders Jamil Hajar Abdul Muttalib (LS 000656) whose names appear in the register of members and record of Idrus Ismail (LS 0008400) depositors on 8 May 2006. Joint Company Secretaries Kuala Lumpur 5 April 2006 NOTES: 4. If the appointer is a corporation, the proxy 7. Explanatory note on special business: form must be executed either under seal or Ordinary Resolution 11, if passed, will give 1. A member of the company entitled to attend under the hand of its attorney. the Directors of the Company authority to and vote at the meeting may appoint a proxy issue ordinary shares in the Company at any or proxies to attend and vote instead of him.