CIMB Group Holdings BERHAD (50841-W) L Annual Report 2010
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CIMB GROUP HOLDINGS BERHAD (50841-W) l Annual Report 2010 BRINGING THE REGION Our Vision To be Southeast Asia’s Most Valued Universal Bank CLOSER Cover Rationale CIMB Group is today closer to our vision of being Southeast Asia’s most valued universal bank. Our regional business proposition which leverages on the region’s largest branch network of over 1,000 branches, a strong regional staff force of 37,000 people as well as regional products and services, facilitates the convergence of people, goods, services and capital in the region. The cover this year also reveals our decision to harmonise the colours of our brands. CIMB brands turning red across the region refl ects the momentum of our businesses growing in tandem with our aspiration to become a truly unifi ed franchise across ASEAN, playing a pivotal role in bringing people, businesses and communities closer together throughout the ASEAN region. CIMB Group would like to thank all staff who submitted their photos for use in this annual report. Contents 54th Annual General Meeting of CIMB Group Holdings Berhad Ballroom 3, 1st Floor, Sime Darby Convention Centre, 1A Jalan Bukit Kiara 1, 60000 Kuala Lumpur. Friday, 22 April 2011 at 9.30 a.m. 002 Chairman’s Message 145 Corporate Structure 008 Performance Review by Group Chief Executive 146 Corporate Profi le 018 Business Review 148 Corporate Organisation Chart 036 Investor Relations 150 Corporate History 038 International Advisory Panel 160 Corporate Information 039 Our Alliances 162 Boards of Major Subsidiaries 040 Corporate Event Highlights 164 Board of Directors’ Profi les 076 Media Highlights 170 Group Management Committee’s Profi les 078 Regional Notable Deals 179 Company Secretary’s Profi le 084 Notable Achievements 180 Group Shariah Committee’s Profi les 096 Statement on Corporate Governance 184 Shareholders’ Statistics 120 Audit Committee Report 187 Top 10 Properties of the Group 126 Statement on Internal Control 188 Notice of Annual General Meeting 134 Risk Management 190 Statement Accompanying Notice of Annual General Meeting 144 Core Philosophies of the Group 196 Group Corporate Directory Proxy Form 002 CIMB GROUP HOLDINGS BERHAD | Annual Report 2010 Message from the Chairman Dear Shareholders, This is the 5th annual report in which we are reporting to shareholders about CIMB Group’s transformation programme since September 2006 when we rebranded and relaunched CIMB Group as a universal bank with a regional footprint. Those were the early days in our transformation journey which we had started in mid-2005 with the merger of CIMB and Bumiputra-Commerce Bank (BCB), and the subsequent merger with Southern Bank Berhad (SBB). Since then, the transformation of the Group got us here will not get us there. This means has been breathtaking. In 5 years, we had that CIMB Group needs to evolve further and CIMB Group needs to transformed ourselves from a Malaysian-centric to strengthen ourselves for the journey ahead. banking group into a regional universal banking Undoubtedly, as we evolve, there will be many have a clear direction franchise. In Indonesia, we merged Bank Niaga challenges, some tribulations and perhaps, even and Bank Lippo and rebranded the merged surprises, that we will have to contend with. to propel us towards entity as CIMB Niaga. We bought a controlling stake in BankThai and rebranded it as CIMB What is important therefore is that CIMB Group achieving our vision. Thai. We launched our consumer banking needs to have a clear direction and a strong franchise in Singapore and Cambodia. We driver to propel us towards achieving our vision. A “Think ASEAN” revamped our corporate structure to benefi t from For this, our clarion call to our staff is “Think cross-border and cross-divisional synergies. We ASEAN”. And we believe that once this mindset mindset is a powerful turned around the performance of our Malaysian is embedded in our staff throughout the region, consumer bank to become one of the fastest it will act as a powerful driver to steer the Group driver to enable the growing consumer banking franchises in the from the regional operating franchise it is today region in addition to being the leading indigenous towards laying claim as the leading ASEAN Group to lay claim as investment bank. franchise supporting the region’s aspirations. the leading ASEAN Today, we are ASEAN’s leading universal banking Although ASEAN is an association of nations franchise with a network of over 1,000 branches, born out of a common political understanding, it franchise supporting the largest in the region. We have 37,000 staff is no longer confi ned to the political sphere. The in 13 countries, and we serve over 11 million region’s policy makers have already set the stage the region’s aspirations. customers, from the largest corporations to the for the advent of an ASEAN Community by 2015, smallest retail customers, catering to all their with a broad and ambitious agenda covering fi nancial needs from cradle to retirement. political, social and economic collaboration. This includes increasing their efforts to promote inter- With these achievements, we have clearly made connectivity within the region as the emergence good progress in pursuit of our corporate vision of a competitive and resilient ASEAN Community of being Southeast Asia's most valued universal depends very much on the convergence of bank. But we are also well aware that what people, goods, services, and capital. CIMB GROUP HOLDINGS BERHAD | Annual Report 2010 003 Message from the Chairman We have clearly made good progress in pursuit of our corporate vision of being Southeast Asia's most valued universal bank. But we are also well aware that what got us here will not get us there. In this regard, to bring the ASEAN Community but by facing and overcoming challenges and to fruition, to complement the policy makers’ adversity, we have gained strength. We may have efforts, I believe that the business people in struggled initially to communicate with colleagues the region will provide the actual impetus for of different nationalities, but by working together, regional connectivity. The ASEAN Community is we have gained a better understanding of the underpinned by sound economics. It is a market multi-cultural environment in which we operate. of 600 million consumers with a combined We may have had to make a conscious effort to GDP that ranks among the top 10 in the work alongside colleagues of different ages, but world. ASEAN also has a young and educated by sharing a common goal, we have learnt to population, and a strategic geographical location bridge the generation gap. between China and India, the emerging Asian economic powerhouses. However, we believe The Group’s execution and implementation that ASEAN’s true economic potential lies in the capabilities are also well established. In 2010, synergies it holds as an integrated economic the Group achieved record profi t before tax of community. RM3.52 billion, translating into return on equity of 16.3%. In the course of the year, we also This is a huge business opportunity for the undertook large projects including sponsorship of Group, but to capitalise on it, we need to be the CIMB Asia Pacifi c Classic, Malaysia, the fi rst 1 At the PINTAR Gala Night, a yearly event to celebrate a prime mover and forge ahead now, with PGA TOUR-sanctioned annual golf tournament in the achievements of the students and teachers of the the confi dence that the ASEAN marketplace the region. Despite this being our fi rst foray into 10 rural schools sponsored by CIMB Foundation. will evolve and follow and that the eventual golf, we leveraged on our strengths in branding, 2 At the ceremony where Tan Sri Siti Norma and connectivity will be a reality. In the history of public and media relations, communications and I announced the award of the CIMB Regional CIMB, through bold strategic moves such as events management to enhance the CIMB brand Scholarship to the 5 receipients. this, we have achieved much as a group, and I through the sponsorship. am confi dent that by embracing “Think ASEAN”, 3 Speaking at the ProAm tournament of the CIMB Asia Pacifi c Classic where our clients, partners and other this will bring us closer to our goal of being We are already very much a part of the stakeholders played alongside the TOUR players. Southeast Asia’s most valued universal bank. community in the region, having formally And shareholders can rest assured that the recognised the community as one of our 4 At the CIMB SEA Games with my colleagues from Group is well ahead in terms of preparing for this stakeholders. In 2010 also, we rolled out Indonesia. bold regional thrust. Community Link, our fl agship corporate social 5 Our yearly Annual Management Dialogue is also responsibility (CSR) programme, to the region. a good chance for me to catch up with my fellow In terms of people, we have built a strong and Through Community Link, our consumer directors. Khun Watanan always brings interesting resilient workforce which is able to harness bank network works with local community perspectives to issues discussed at the Board. the diverse skills and talents needed to serve organisations to implement programmes within 6 It was an honour to be recognised for the good work the region. The scale of CIMB’s transformation the communities in which they operate to that we do. I was at the MSWG Awards Ceremony to date, the pace at which we moved, the deliver long-term sustainable benefi ts to those with my fellow board members and colleagues to intensity of the programmes, the sheer size of communities.