Page 176 - Bank Muamalat_AR24

174 BANK MUAMALAT MALAYSIA BERHAD

STATEMENT ON RISK MANAGEMENT

The governance structure and committees responsible for effective governance and supervision over risk-related functions
is as illustrated below:
RISK GOVERNANCE STRUCTURE

Board of Directors (BOD)

Establish a strong risk management and provides oversight for overall risk governance to ensure that the Bank’s strategic
objectives are supported by sound risk strategy and an effective risk management framework

Board Risk Committees

Board Risk & Compliance Committee (BRCC) Board Veto Committee (VETO) Shariah Committee (SC)
Ensure effective management of risks and Review approvals of large Serve as advisory
enforcement of approved risk tolerances and limits. financing granted by Credit to the Board and
Review and assess the existing risk management Committee (management level). Management team on
framework for its continued efficacy. all Shariah matters.
Ensure robust infrastructure and systems as well as
resources are in place to monitor risk and capital
effectively.

Executive Level-Risk Management Committees

Executive Risk Management Committee (ERMC), Asset Liability Committee (ALCO), Credit Committee (CC),
Investment Committee (IC), Operational Risk Management Committee (ORMC), Enterprise Risk Management
Committee (ERMCo), Asset Quality and Impairment Committee (AQIC), Credit Risk Management Committee
(CRMC), Model Validation and Acceptance Committee (MVAC), Recovery Task Force (RTF) and Climate Risk Working
Group (CRWG)
Undertake the execution and implementation of Bank’s strategies, policies and methodologies in line with the Board’s
vision.
Identify, evaluate, measure and monitor the strategic and business plans, capital plan and risk appetite statement as
per the Board’s approval.

Line of Defence

rd
nd
st
1 Line 2 Line 3 Line
(Business Units) (Risk Management Control & Compliance) (Internal Audit)
Risk are directly undertaken Ensure independent oversight and Provide independent
and assumed in the day-to-day management of all material risks undertaken review and assurance
business activities and operations. by the Bank. on adequacy of risk
As front-liners, responsible for Provide specialised resources for management process
carrying out the established developing risk frameworks, policies, and effectiveness of
processes for identifying, methodologies and tools for risk the first two lines of
mitigating and managing identification, measurement and control. defence in fulfilling their
risks within their respective Provide the control function, which monitors mandates.
environment aligned with the the risk by using various key indicators and
Bank’s strategic targets. reports, guided by established risk appetite
and tolerance limits.