Page 175 - Bank Muamalat_AR24

ANNUAL REPORT 2024 1 2 3 4 5 6 Governance 7 8 173

STATEMENT ON RISK MANAGEMENT

The Bank adopts a prudent approach to risk management and has implemented appropriate control frameworks to support
sustainable business growth. Key control mechanisms include timely identification and escalation of current and emerging risks,
as well as enhanced oversight to ensure growth remain within the Bank’s established risk appetite and driven by risk-informed
decision-making process.

BOARD RESPONSIBILITY
The Board plays a vital role in providing risk oversight and determining the Bank’s risk appetite in achieving its strategic objectives
by ensuring sound risk management and internal control systems are maintained within the Bank.
The Board’s responsibilities include approving and reviewing the adequacy and effectiveness of the risk management policies
and frameworks used in identifying, assessing, monitoring and mitigating risks. The control structures and processes, which
incorporate elements of financial, risk and compliance management, have been instituted throughout the Bank. These structures
and processes are periodically reviewed to ensure continuous relevance to the business environment.

MANAGEMENT RESPONSIBILITY

The Management is responsible for developing and implementing all policies and frameworks approved by the Board as well as
identifying, evaluating, measuring and monitoring risk exposures. The roles of the Management include:

• identify and evaluate the risks relevant to the Bank’s business and strategic directions;
• formulate relevant policies and procedures to manage risks in accordance with the Bank’s strategic vision and overall risk appetite;

• design and implement risk management policies and frameworks; and
• report in a timely manner to the Board on any changes to the current risks or any emerging risks and the appropriate actions
taken.

RISK GOVERNANCE
The Bank’s risk governance and oversight structure outlines the accountabilities, as well as roles and responsibilities for the
management of risk. The Board plays a crucial role in establishing a strong risk management structure and provides oversight
for overall risk governance to ensure that the Bank’s strategic objectives are supported by sound risk strategies and an effective
risk management framework. To carry out its risk and control oversight, the Board is supported by the Board Risk & Compliance
Committee (BRCC), which directly oversees matters related to risk. The BRCC updates the Board on a monthly basis regarding
key deliberations and decisions.