Page 298 - Bank Muamalat_AR24

296 BANK MUAMALAT MALAYSIA BERHAD

NOTES TO THE FINANCIAL STATEMENTS
31 DECEMBER 2024 (29 JAMADIL AKHIR 1446H)

47. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONT’D.)

Categories of financial instruments (cont’d.)
Carrying Amortised
amount cost FVOCI FVTPL
Bank RM’000 RM’000 RM’000 RM’000

2023
Financial assets
Cash and short-term funds 3,039,191 3,039,191 - -
Financial investments 6,653,433 116,871 6,505,466 31,096
Islamic derivative financial assets 12,819 - - 12,819
Financing of customers 28,343,392 27,992,902 - 350,490
Statutory deposits with Bank Negara Malaysia 583,809 583,809 - -
Other financial assets* 114,754 114,754 - -
38,747,398 31,847,527 6,505,466 394,405

Financial liabilities
Deposits from customers 32,811,802 32,811,802 - -
Investment accounts of customers 247,689 247,689 - -
Deposits and placements of banks and
other financial institutions 529,634 529,634 - -
Bills and acceptances payable 13,773 13,773 - -
Islamic derivative financial liabilities 21,519 - - 21,519
Other financial liabilities 101,105 101,105 - -
Recourse obligation on financing
sold to Cagamas 1,058,745 1,058,745 - -
Subordinated sukuk 806,924 806,924 - -
35,591,191 35,569,672 - 21,519

* These balances exclude balances which are not within the scope of MFRS 9, Financial Instruments.
(a) Credit risk
Credit risk is defined as the potential loss to the Group and the Bank as a result of defaults in payment
by counterparties via financing and investing activities. The Group and the Bank comprehend that credit
risk is inherent in its credit products activities such as credit financing facilities activities (funded/non-funded
facilities); treasury activities (including inter-bank money market, money and capital trading, foreign exchange);
and investment banking activities (including underwriting of corporate sukuk issuance).
The Group’s and the Bank’s RMD and Senior Management, via ERMC, implement and execute strategies and
policies in managing credit risk to ensure that the Bank’s exposure to credit is always kept within the Group’s
and the Bank’s risk appetite parameters, and that the Group and the Bank are able to identify its risk tolerance
levels. The administration of credit risk is governed by a full set of credit-related policies such as Credit Risk
Policy (“CRP”), Guidelines to Credit Risk Policies (“GCRP”), product manuals and standard operating procedures.