Alliance Bank Berhad: Condensed Interim Financial Statements - 31 March 2021

Transcription

1. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Statements of Financial Position as at 31 March 2021 GROUP 31 March 2021 RM'000 31 March 2020 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 3,088,245 3,119,214 1,779,243 2,488,527 41,477 105,041 237,922 51,165 650,114 41,477 167,728 585,722 10,424,669 2,270,504 153,735 43,233,506 293,653 44,357 88,012 994 120,457 57,264 130,100 431,259 11,544,507 121,299 436,910 43,110,007 262,622 70,834 949,049 903 129,139 64,486 28,125 437,086 7,303,866 2,294,765 153,735 32,395,127 349,416 9,600 69,574 1,109,102 120,439 55,930 95,200 329,004 8,426,778 170,405 436,910 32,207,545 266,770 38,789 700,355 909,102 129,077 63,448 14,074 332,680 60,721,195 60,975,460 46,274,206 46,770,182 A17 48,488,513 48,425,852 36,150,316 36,702,989 A18 A19 1,392,652 63,416 1,543,646 22,292 659,377 - 733,564 - A20 472,695 427,085 472,695 427,085 B11 149,410 369,469 348,877 149,410 221,387 348,877 650,499 123,494 1,546,070 848 760 2,333 1,572,718 800,695 130,223 1,388,066 1,245 8,379 1,520,637 300,100 123,475 1,322,169 1,471,978 300,053 130,150 1,253,186 1,480,254 54,463,408 54,986,466 40,649,520 41,597,545 Share capital Reserves 1,548,106 4,709,681 1,548,106 4,440,888 1,548,106 4,076,580 1,548,106 3,624,531 TOTAL EQUITY 6,257,787 5,988,994 5,624,686 5,172,637 60,721,195 60,975,460 46,274,206 46,770,182 30,367,400 36,971,704 27,636,885 34,144,629 4.04 3.87 3.63 3.34 Note ASSETS Cash and short-term funds Deposits and placements with banks and other financial institutions Amounts due from clients and brokers Financial assets at fair value through profit or loss Financial investments at fair value through other comprehensive income Financial investments at amortised cost Derivative financial assets Loans, advances and financing Other assets Tax recoverable Statutory deposits Investments in subsidiaries Investment in joint venture Right-of-use assets Property, plant and equipment Deferred tax assets Intangible assets A11 A12 A13 A14 B11 A15 A16 TOTAL ASSETS LIABILITIES AND EQUITY Deposits from customers Deposits and placements of banks and other financial institutions Amounts due to clients and brokers Financial liabilities designated at fair value through profit or loss Obligations on securities sold under repurchase agreements Derivative financial liabilities Recourse obligations on loans and financing sold to Cagamas Lease liabilities Other liabilities Provision for zakat Provision for taxation Deferred tax liabilities Subordinated obligations A21 TOTAL LIABILITIES TOTAL LIABILITIES AND EQUITY COMMITMENTS AND CONTINGENCIES A30 Net assets per share attributable to equity holders of the Bank (RM)* * The net assets per share attributable to Equity holders of the Bank is computed as total capital and reserves attributable to the equity holders of the Bank divided by total number of ordinary shares in circulation. The Condensed Interim Financial Statements should be read in conjunction with the audited financial statements of the Group and the Bank for the financial year ended 31 March 2020. 1
2. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Consolidated Statements of Income for the Financial Period/Year Ended 31 March 2021 4th Quarter Ended Financial Year Ended 31 March 31 March 31 March 31 March 2021 2020 2021 2020 GROUP Note RM'000 RM'000 RM'000 RM'000 Interest income A22 422,989 515,729 1,793,421 2,069,887 Interest expense A23 (155,654) (261,269) 267,335 254,460 1,016,656 980,834 97,699 92,026 378,500 377,896 365,034 346,486 1,395,156 1,358,730 Net interest income Net income from Islamic banking business A24 (776,765) (1,089,053) Fee and commission income A25 82,755 73,737 313,957 283,272 Fee and commission expense A25 (29,585) (22,126) (111,623) (87,118) Investment income A25 22,213 5,390 248,559 87,565 Other income/(expense) A25 5,397 30,922 (28,482) 46,871 Other operating income A25 80,780 87,923 422,411 330,590 445,814 434,409 1,817,567 1,689,320 (232,135) (205,412) 213,679 228,997 (136,581) (98,389) Net income Other operating expenses A26 Operating profit before allowances (800,658) 1,016,909 (807,019) 882,301 Allowance for expected credit losses on loans, advances and financing and other financial assets A27 (532,916) (273,234) (96) (36,997) Write-back of/(allowance for) expected credit losses on financial investments A28 109 A29 - 407 Allowance for impairment losses on non-financial assets Operating profit after allowances 77,207 Share of results of joint venture Profit before taxation Taxation Net profit for the financial period/year B6 Net profit for the financial period/year attributable to: Equity holders of the Bank (631) 130,384 483,897 (4,317) 567,753 18 17 91 101 77,225 130,401 483,988 567,854 (27,153) 50,072 (32,344) 98,057 (125,203) 358,785 (143,591) 424,263 50,072 98,057 358,785 424,263 3.2 3.2 6.3 6.3 23.2 23.2 27.4 27.4 Earnings per share attributable to Equity holders of the Bank - Basic (sen) - Diluted (sen) B14(a) B14(b) 2
3. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Consolidated Statements of Comprehensive Income for the Financial Period/Year Ended 31 March 2021 4th Quarter Ended 31 March 31 March GROUP Net profit for the financial period/year Financial Year Ended 31 March 31 March 2021 2020 2021 2020 RM'000 RM'000 RM'000 RM'000 50,072 98,057 358,785 424,263 (293,402) (30,447) (17,029) 112,932 (10,266) (635) (101,357) (17,634) 28,413 (22,872) Other comprehensive (expense)/income: Items that may be reclassified subsequently to profit or loss: Revaluation reserve on financial investments at fair value through other comprehensive income ("FVOCI") - Net (loss)/gain from change in fair value - Realised gain transferred to statement of income on disposal - Transfer from/(to) deferred tax 72,881 - Changes in expected credit losses 7,459 (211) (42) (19) (9,627) Other comprehensive (expense)/income, net of tax (230,998) (23,665) (89,992) 62,799 Total comprehensive (expense)/income for the financial period/year (180,926) 74,392 268,793 487,062 (180,926) 74,392 268,793 487,062 Total comprehensive (expense)/income for the financial period/year attributable to: Equity holders of the Bank The Condensed Interim Financial Statements should be read in conjunction with the audited financial statements of the Group and the Bank for the financial year ended 31 March 2020. 3
4. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Statements of Income for the Financial Period/Year Ended 31 March 2021 4th Quarter Ended Financial Year Ended 31 March 31 March 31 March 31 March 2021 2020 2021 2020 BANK Note RM'000 RM'000 RM'000 RM'000 Interest income A22 410,801 498,156 1,743,871 2,019,369 Interest expense A23 (151,735) (252,300) (760,356) 259,066 245,856 983,515 972,945 Net interest income (1,046,424) Fee and commission income A25 63,564 64,252 236,609 248,493 Fee and commission expense A25 (21,967) (19,324) (81,665) (78,700) Investment income A25 22,213 5,390 469,340 126,885 Other income/(expense) A25 5,349 31,142 (28,545) 48,012 Other operating income A25 Net income Other operating expenses A26 Operating profit before allowances 69,159 81,460 595,739 344,690 328,225 327,316 1,579,254 1,317,635 (175,078) (155,869) (616,515) (621,229) 153,147 171,447 962,739 696,406 (78,859) (59,631) (319,409) (168,495) Allowance for expected credit losses on loans, advances and financing and other financial assets A27 Write-back of/(allowance for) expected credit losses on financial investments A28 226 A29 - 345 53 (22,996) - (306) Allowance for of impairment losses on non-financial assets Profit before taxation Taxation Net profit for the financial period/year B6 Net profit for the financial period/year attributable to: Equity holders of the Bank (306) 74,514 111,855 643,383 504,609 (25,987) 48,527 (27,743) 84,112 (106,593) 536,790 (115,471) 389,138 48,527 84,112 536,790 389,138 3.1 3.1 5.4 5.4 34.7 34.7 25.1 25.1 Earnings per share attributable to Equity holders of the Bank - Basic (sen) - Diluted (sen) B14(a) B14(b) 4
5. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Statements of Comprehensive Income for the Financial Period/Year Ended 31 March 2021 4th Quarter Ended BANK Net profit for the financial period/year Financial Year Ended 31 March 31 March 31 March 31 March 2021 2020 2021 2020 RM'000 RM'000 RM'000 RM'000 48,527 84,112 536,790 389,138 (216,686) (18,065) (35,487) 71,196 (8,030) (635) (75,953) (14,402) 26,746 (13,631) Other comprehensive (expense)/income: Items that may be reclassified subsequently to profit or loss: Revaluation reserve on financial investments at FVOCI - Net (loss)/gain from change in fair value - Realised gain transferred to statement of income on disposal - Transfer from/(to) deferred tax 53,932 - Changes in expected credit losses 4,488 (119) (26) (47) (160) Other comprehensive (expense)/income, net of tax (170,903) (14,238) (84,741) 43,003 Total comprehensive (expense)/income for the financial period/year (122,376) 69,874 452,049 432,141 (122,376) 69,874 452,049 432,141 Total comprehensive (expense)/income for the financial period/year attributable to: Equity holders of the Bank The Condensed Interim Financial Statements should be read in conjunction with the audited financial statements of the Group and the Bank for the financial year ended 31 March 2020. 5
6. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Consolidated Statements of Changes in Equity for the Financial Year Ended 31 March 2021 Attributable to Equity holders of the Bank GROUP Ordinary shares RM'000 Regulatory reserves RM'000 Capital reserves RM'000 FVOCI reserves RM'000 Retained profits RM'000 Total equity RM'000 At 1 April 2020 Net profit for the financial year Other comprehensive expense Total comprehensive (expense)/income for the financial year Transfer from regulatory reserves At 31 March 2021 1,548,106 1,548,106 224,579 (138,139) 86,440 100,150 100,150 141,312 (89,992) (89,992) 51,320 3,974,847 358,785 358,785 138,139 4,471,771 5,988,994 358,785 (89,992) 268,793 6,257,787 At 1 April 2019 As previously stated Effects of adoption of MFRS 16 As restated Net profit for the financial year Other comprehensive income Total comprehensive income for the financial year Transfer to regulatory reserves Liquidation of subsidiaries Dividends paid to shareholders At 31 March 2021 1,548,106 1,548,106 1,548,106 178,397 178,397 46,182 224,579 100,150 100,150 100,150 78,513 78,513 62,799 62,799 141,312 3,827,676 (9,526) 3,818,150 424,263 424,263 (46,182) (1,553) (219,831) 3,974,847 5,732,842 (9,526) 5,723,316 424,263 62,799 487,062 (1,553) (219,831) 5,988,994 The Condensed Interim Financial Statements should be read in conjunction with the audited financial statements of the Group and the Bank for the financial year ended 31 March 2020. 6
7. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Statements of Changes in Equity for the Financial Year Ended 31 March 2021 (Contd.) Distributable Non-Distributable reserves reserves Ordinary Regulatory Capital FVOCI Retained Total shares reserves reserves reserves profits equity RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 1,548,106 182,292 15,515 79,834 3,346,890 5,172,637 Net profit for the financial period - - - - 536,790 536,790 Other comprehensive expense - - - (84,741) - Total comprehensive (expense)/income for the financial year - - - (84,741) 536,790 452,049 BANK At 1 April 2020 Transfer from regulatory reserves At 31 March 2021 (84,741) 1,548,106 (102,286) 80,006 15,515 (4,907) 102,286 3,985,966 5,624,686 1,548,106 160,798 95,515 36,831 3,128,589 4,969,839 - - - - 1,548,106 160,798 95,515 36,831 3,119,077 4,960,327 Net profit for the financial period - - - - 389,138 389,138 Other comprehensive income - - - 43,003 - 43,003 Total comprehensive income for the financial year - - - 43,003 389,138 432,141 Transfer to regulatory reserves - 21,494 - - (21,494) - Return to capital from a subsidiary - - - 80,000 - 1,548,106 182,292 At 1 April 2019 As previously stated Effects of adoption of MFRS 16 As restated Dividends paid to shareholders At 31 March 2020 (80,000) 15,515 79,834 (9,512) (219,831) 3,346,890 The Condensed Interim Financial Statements should be read in conjunction with the audited financial statements of the Group and the Bank for the financial year ended 31 March 2020. 7 (9,512) (219,831) 5,172,637
8. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Condensed Statements of Cash Flows for the Financial Period Ended 31 March 2021 GROUP 31 March 2021 RM'000 31 March 2020 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation Adjustments for: Accretion of discount less amortisation of premium of financial investments Allowance for expected credit losses on loans, advances and financing Allowance for/(write-back of) expected credit losses on commitment and contingencies on loans, advances and financing Allowance for/(write-back of) expected credit losses on financial investments (Write-back of)/allowance for expected credit losses on amounts due from clients and brokers Allowance for expected credit losses on other receivables Allowance for/(write-back of) expected credit losses on short term funds Allowance for expected credit losses deposits and placements with banks Allowance for impairment losses on non-financial assets Amortisation of computer software Depreciation of property, plant and equipment Depreciation of right-of-use assets Dividends from financial assets at fair value through profit or loss Dividends from subsidiaries Interest expense on lease liabilities Interest expense on subordinated obligations Interest expense on recourse obligations on loans and financing sold to Cagamas Interest income from financial investments at amortised cost Interest income from financial investments at fair value through other comprehensive income Computer software written-off Property, plant and equipment written-off Gain on disposal of property, plant and equipment Net gain from sale of financial assets at fair value through profit or loss Net gain from sale of financial investments at fair value through other comprehensive income Net loss/(gain) from sale of other investments Unrealised loss/(gain) arising from derivative instruments Unrealised gain arising from financial assets at fair value through profit or loss Unrealised (gain)/loss arising from financial liabilities designated at fair value through profit or loss Share of results of joint venture Zakat Cash flow from operating activities before working capital changes carried forward 483,988 567,854 643,383 504,609 (11,125) (83,215) (11,282) (83,950) 485,776 286,760 302,286 184,092 25,108 96 (3) 2,086 19 36,997 3 3,827 (37) 6,502 (53) 1,815 19 (8,599) 22,996 3,539 (37) 4 41,558 21,479 25,363 4,317 36,864 22,661 24,259 4 40,120 20,470 25,319 306 35,366 22,110 24,213 (1,480) 6,741 76,971 (4,419) 6,577 84,538 (931) (238,929) 6,738 77,248 (2,668) (48,031) 6,572 84,732 13,591 (38,640) 13,627 (6,818) 13,591 (45,790) 13,627 (12,866) (320,203) 85 - (318,454) 4,399 174 (5,319) (286,130) 81 - (292,218) 4,399 104 (5,319) (10,405) (15,481) (10,405) (15,361) (87,750) 5 74,657 (17,634) (5) (63,991) (75,953) 5 74,657 (14,402) (5) (63,991) (30,121) (23,207) (24,319) (19,599) (7,042) (91) (34) 11,742 (101) 655 (7,042) - 11,742 - 750,633 8 (8,076) 558,497 511,404 351,361
9. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Condensed Statements of Cash Flows for the Financial Period Ended 31 March 2021 (Contd.) GROUP 31 March 2021 RM'000 31 March 2020 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 CASH FLOWS FROM OPERATING ACTIVITIES (contd.) Cash flow from operating activities before working capital changes brought forward: Changes in working capital: Amounts due (from)/to clients and brokers Deposits from customers Deposits and placements of banks and other financial institutions Deposits and placements with banks and other financial institutions Financial liabilities designated at fair value through profit or loss Proceeds from redemption/disposal of financial assets at fair value through profit or loss (net of purchase) Loans, advances and financing Other assets Other liabilities Obligations on securities sold under repurchase agreements Statutory deposits Cash generated from operations Taxation paid Zakat paid Net cash generated from operating activities 750,633 558,497 511,404 (12,752) 62,661 (3,029) 3,408,220 (552,673) 1,720,127 (150,994) 684,938 (74,187) 388,729 (41,481) 500 (41,481) - 52,652 440,518 (609,276) (33,180) 132,896 (369,469) 861,037 1,083,245 (174,609) (326) 908,310 (363,080) (388,929) (1,076,422) (68,945) (350,683) 369,469 572,543 3,343,079 (158,537) (95) 3,184,447 351,361 52,652 (363,080) 440,518 (489,868) (84,028) 59,591 (221,387) 630,781 231,322 (128,894) 102,428 (389,048) 231,340 48,856 (315,151) 221,387 441,753 2,336,274 (118,809) 2,217,465 CASH FLOWS FROM INVESTING ACTIVITIES Dividends from financial assets at fair value through profit or loss Dividends from subsidiaries Capital injection into subsidiaries Interest received from financial assets at fair value through profit or loss Interest received from financial investments at fair value through other comprehensive income Interest received from financial investments at amortised costs Net cash flow from subsidiaries Net interest received/(paid) for derivative instruments Purchase of computer software Purchase of property, plant and equipment Proceeds from disposal of property, plant and equipment Purchase of: - financial investments at fair value through other comprehensive income - financial investments at amortised cost Proceed from redemption/disposal of: - financial investments at fair value through other comprehensive income - financial investments at amortised cost Net cash used in investing activities 9 1,480 - 4,419 - 931 238,929 (200,000) 2,668 48,031 - 12,200 7,943 12,200 7,943 332,181 312,289 293,593 285,523 19,942 9,051 (36,953) (13,145) 25 8,311 (26,145) (49,705) (26,854) 6,101 29,281 9,051 (36,444) (13,058) 25 14,645 80,000 (26,145) (48,947) (26,514) 6,101 (3,970,475) (2,426,730) (5,056,202) (100,000) (3,913,031) (2,078,053) (4,213,537) (20,000) 5,029,031 323,396 (719,997) 3,095,935 262,767 (1,561,141) 4,974,480 (682,096) 2,714,366 223,690 (952,176)
10. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Condensed Interim Financial Statements Unaudited Condensed Statements of Cash Flows for the Financial Period Ended 31 March 2021 (Contd.) GROUP 31 March 2021 RM'000 31 March 2020 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid to shareholders of the company Interest paid on subordinated obligations Interest paid on recourse obligations on loans and financing sold to Cagamas Repayment from recourse obligations on loans and financing sold to Cagamas Repayment of lease liabilities Proceeds from issuance of subordinated notes Net cash used in financing activities NET CHANGE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF FINANCIAL PERIOD CASH AND CASH EQUIVALENTS AT END OF FINANCIAL PERIOD (84,890) (219,831) (84,123) (85,524) (219,831) (84,058) (13,787) (13,601) (13,544) (13,650) (150,000) (30,605) 60,000 (219,282) (31,271) 40,000 (308,826) (30,548) (129,616) (31,218) (348,757) (709,284) 916,532 (30,969) Cash and cash equivalents comprise the following: Cash and short-term funds 1,314,480 3,119,214 1,804,734 2,488,527 1,571,995 3,088,245 3,119,214 1,779,243 2,488,527 3,088,245 3,119,214 1,779,243 2,488,527 The Condensed Interim Financial Statements should be read in conjunction with the audited financial statements of the Group and the Bank for the financial year ended 31 March 2020. 10
11. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) Explanatory Notes PART A - Explanatory Notes Pursuant to Malaysian Financial Reporting Standard ("MFRS") 134 and Guidelines on Financial Reporting Issued by Bank Negara Malaysia ("BNM") A1 Basis of Preparation The unaudited condensed interim financial statements for the fourth financial quarter and financial year ended 31 March 2021 have been prepared under the historical cost convention, except for financial assets at fair value through profit or loss, financial investment at fair value through other comprehensive income, derivative financial instruments and financial liabilities designated at fair value through profit or loss that are measured at fair value. The unaudited condensed interim financial statements have been prepared in accordance with MFRS 134 "Interim Financial Reporting" issued by the Malaysian Accounting Standards Board ("MASB"), Chapter 9.22 of Bursa Malaysia Securities Berhad's Listing Requirements and should be read in conjunction with the audited annual financial statements of the Group and the Bank for the financial year ended 31 March 2020. The explanatory notes attached to the interim financial statements provide an explanation of events and transactions that are significant to an understanding of the changes in the financial position and performance of the Group and Bank since the financial year ended 31 March 2020. (a) The significant accounting policies and methods of computation applied in the unaudited condensed interim financial statements are consistent with those adopted in the most recent audited annual financial statements for the financial year ended 31 March 2020 and modified for the adoption of the following accounting standards applicable for financial periods beginning on or after 1 April 2020: • • • • • Amendments to MFRS 3 "Definition of a Business" Amendments to MFRS 101 "Presentation of Financial Statements” and MFRS 108 “Accounting Policies, Changes in Accounting Estimates and Errors” Amendments to the Conceptual Framework for Financial Reporting Amendments to MFRS 9, MFRS 139 and MFRS 7 "Interest Rate Benchmark Reform" Amendments to MFRS 16 “COVID-19 Related Rent Concessions” The adoption of the above standards, amendments to published standards and interpretations to existing standards did not have any significant any significant impact on the financial statements of the Group and the Bank. The preparation of unaudited condensed interim financial statements in conformity with the Malaysian Financial Reporting Standards requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed interim financial statements, and the reported amounts of revenues and expenses during the reported period. It also requires Directors to exercise their judgement in the process of applying the Group's and the Bank's accounting policies. Although these estimates and judgement are based on the Directors' best knowledge of current events and actions, actual results may differ. (b) Measures to Assist Individuals, Small-Medium Enterprises ("SMEs") and Corporates Affected by COVID-19 On 24 March 2020, BNM had announced that banking institutions would grant a 6 months automatic moratorium on repayments of loans and financing from 1 April 2020 to all small and medium enterprises and individuals to alleviate the financial difficulties of customers impacted by the COVID-19 pandemic. The 6 months moratorium granted is applicable for loans denominated in Ringgit Malaysia (does not apply to credit card balances), that have not been in arrears for more than 90 days as at 1 April 2020. Banking institutions will also facilitate requests by corporate customers to defer or restructure their loans or financing repayments in a way that will enable viable corporations to preserve jobs and resume economic activities when conditions stabilised and improved. The moratorium should not automatically result in stage transfer under MFRS 9 in the absence of other factors relevant to the assessment. 11
12. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A2 Auditors' Report on Preceding Annual Financial Statements The auditors' report on the annual financial statements for the financial year ended 31 March 2020 was not qualified. A3 Seasonality or Cyclicality of Operations The operations of the Group and the Bank were not materially affected by any seasonal or cyclical fluctuations during the fourth financial quarter and financial year ended 31 March 2021. A4 Unusual Items Due to Their Nature, Size or Incidence There were no unusual items affecting the assets, liabilities, equity, net income or cash flows of the Group and the Bank during the fourth financial quarter and financial year ended 31 March 2021. A5 Changes in Estimates There were no material changes in estimates of amounts reported in prior financial years that have a material effect during the fourth financial quarter and financial year ended 31 March 2021. A6 Issuance and Repayment of Debt and Equity Securities There were no issuance nor repayment of debt and equity securities during the fourth financial quarter and financial year ended 31 March 2021 other than disclosed as below: (i) The Bank had fully redeemed its existing RM900.0 million and RM300.0 million Subordinated Medium Term Notes (“Sub-MTN”) which were issued on 27 October 2015 and 18 December 2015 respectively under Sub-MTN Programme of RM2.0 billion in nominal value (“Sub-MTN Programme”); and (ii) The Bank had on 27 October 2020 completed the issuance of three (3) new tranches of Sub-MTNs totalling RM1.2 billion in nominal value pursuant to the Sub-MTN Programme. The details of the Sub-MTN Issuance are summarised as follows: Nominal Amount Tenure Call Date Coupon Rate RM400.0 million Ten (10)-years NonCallable Five (5)-years 27 October 2025 and thereafter on every coupon payment date 3.60% p.a RM350.0 million Ten (12)-years NonCallable Five (7)-years 27 October 2027 and thereafter on every coupon payment date 3.80% p.a RM450.0 million Ten (15)-years Non28 October 2030 and thereafter on every coupon Callable Five (10)-years payment date 4.05% p.a The Sub-MTN issued will qualify as Basel III compliant Tier 2 capital of ABMB pursuant to Bank Negara Malaysia ("BNM")'s Capital Adequacy Framework (Capital Components). The approval from BNM for the Sub-MTN Issuance had been obtained on 29 July 2020 (subject to the terms and conditions contained therein). A7 Dividend Paid No dividend has been paid during the fourth financial quarter and financial year ended 31 March 2021. A8 Significant Events On 21 December 2020, the Bank has subscribed for 69,204,152 ordinary shares at an issue price of RM2.89 per share amounting to RM200,000,000 issued by its wholly owned subsidiary Alliance Islamic Bank Berhad. A9 Material Events Subsequent to the End of the Financial Reporting Period There were no material events subsequent to the end of financial reporting period that require disclosure or adjustment to the unaudited condensed interim financial statements. 12
13. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) the unaudited condensed interim financial statements. A10 Related Party Transactions All related party transactions within the Group and the Bank have been entered into in the normal course of business. A11 Amounts Due From Clients And Brokers GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Due from clients Less: Allowance for expected credit losses 105,041 105,041 51,168 (3) 51,165 These represent amounts receivable by Alliance Investment Bank Berhad ("AIBB") from non-margin clients and outstanding contracts entered into on behalf of clients where settlement via the Bursa Malaysia Securities Clearing Sdn. Bhd. has yet to be made. Alliance Investment Bank Berhad's normal trade credit terms for non-margin clients is two (2) market days in accordance with the Bursa Malaysia Securities Berhad's ("Bursa") Fixed Delivery and Settlement System ("FDSS") trading rules. The movements in allowance for expected credit losses are as follows: Lifetime ECL 31 March 31 March 2021 2020 RM'000 RM'000 GROUP At beginning of financial year (Write-back of)/allowance made during the financial year (net) Write-off during the financial year At end of financial year 3 (3) - 839 3 (839) 3 As at 31 March 2021, the Group's gross exposure of amounts due from clients and brokers that are credit impaired was at RM Nil (31 March 2020: RM20,000). A12 Financial Assets at Fair Value Through Profit or Loss ("FVTPL") GROUP 31 March 31 March 2021 2020 RM'000 RM'000 At fair value Money market instruments: Malaysian Government securities Malaysian Government investment issues Unquoted securities: Shares Corporate bonds and sukuk Total financial assets at FVTPL 13 BANK 31 March 2021 RM'000 31 March 2020 RM'000 10,036 3,210 13,246 281,147 156,782 437,929 10,036 3,210 13,246 281,147 156,782 437,929 224,676 224,676 202,160 10,025 212,185 154,482 154,482 137,768 10,025 147,793 237,922 650,114 167,728 585,722
14. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A13 Financial Investments at Fair Value Through Other Comprehensive Income ("FVOCI") At fair value Money market instruments: Malaysian Government securities Malaysian Government investment issues Negotiable instruments of deposits Commercial papers GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 2,007,478 3,471,755 5,479,233 2,629,580 3,678,013 169,217 6,476,810 1,912,391 2,289,793 4,202,184 2,423,247 2,335,412 505,225 139,532 5,403,416 15 5 15 5 4,945,421 5,067,692 3,101,667 3,023,357 10,424,669 11,544,507 7,303,866 8,426,778 Quoted securities: Shares Unquoted securities: Corporate bonds and sukuk Total financial investments at FVOCI Movements in allowance for expected credit losses are as follows: GROUP At 1 April 2020 Transfer to Stage 1 Transfer to Stage 2 New financial investments originated or purchased Financial investments derecognised other than write-off Changes due to change in credit risk Total (write-back from)/charge to income statement At 31 March 2021 12 months ECL (Stage 1) RM'000 Lifetime ECL Not-credit Impaired (Stage 2) RM'000 138 40 (40) 208 (337) 677 14 At 1 April 2019 New financial investments originated or purchased Financial investments derecognised other than write-off Changes due to change in credit risk Total charge to/(write-back from) income statement Write-off At 31 March 2020 Total RM'000 - 346 (297) 637 - 14 - (24) (349) (19) 327 (19) (37) (42) 96 (5) (312) 23 231 120 444 9,409 9,973 59 - - 59 (29) (12) 18 138 14 - Lifetime ECL Credit Impaired (Stage 3) RM'000 (236) (236) 208 (9,409) - (29) (248) (218) (9,409) 346
15. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A13 Financial Investments at Fair Value Through Other Comprehensive Income ("FVOCI") (Contd.) Movements in allowance for expected credit losses are as follows: (contd.) BANK At 1 April 2020 Transfer to Stage 1 Transfer to Stage 2 New financial investments originated or purchased Financial investments derecognised Financial investments derecognised other than write-off Changes due to change in credit risk Total write-back from income statement At 31 March 2021 At 1 April 2019 New financial investments originated or purchased Financial investments derecognised Financial investments derecognised other than write-off Changes due to change in credit risk Total charge to/(write-back from) income statement At 31 March 2020 12 months ECL (Stage 1) RM'000 Lifetime ECL Not-credit Impaired (Stage 2) RM'000 Lifetime ECL Credit Impaired (Stage 3) RM'000 71 23 (23) 14 151 (154) 310 - - 222 (131) 287 14 (7) (17) (10) 61 (5) (188) (37) 114 - (12) (205) (47) 175 55 43 327 - - 382 43 (25) (2) 16 71 (176) (176) 151 - (25) (178) (160) 222 Total RM'000 Note: The transfer between stages are inclusive of net remeasurement allowances. The Group's and the Bank's gross exposure of financial investments at FVOCI that are credit impaired are as follows: 31 March 2021 RM'000 GROUP At beginning of financial year Write-off during the financial year At end of financial year A14 - 31 March 2020 RM'000 9,409 (9,409) - Financial Investments at Amortised Cost At amortised cost Money market instruments: Malaysian Government securities Malaysian Government investment issues Negotiable instruments of deposits Unquoted securities: Corporate bonds and sukuk Less: Allowance for expected credit losses GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 289,741 1,859,678 2,149,419 289,741 1,647,210 187,404 2,124,355 122,338 (1,253) 121,085 Total financial investments at amortised cost 2,270,504 15 - 170,681 (49,382) 121,299 121,299 171,332 (922) 170,410 2,294,765 31 March 2020 RM'000 - 195,455 (25,050) 170,405 170,405
16. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A14 Financial Investments at Amortised Cost (Contd.) Movements in allowance for expected credit losses are as follows: 12 months ECL (Stage 1) GROUP At 1 April 2020 New financial investments originated or purchased Financial investments derecognised other than write-off Changes due to change in credit risk Total charge to income statement Write-off At 31 March 2021 At 1 April 2019 Transfer to Stage 3 New financial investments originated or purchased Financial investments derecognised other than write-off Changes due to change in credit risk Total charge to/(write-back from) income statement Write-off At 31 March 2020 Lifetime ECL Not-credit Impaired (Stage 2) RM'000 RM'000 RM'000 308 - 49,074 49,382 - - 569 569 115 115 423 - 131 (26) 161 266 308 1,112 (540) - (569) 115 115 (48,244) 1,253 14,193 50,000 14,775 48,348 - 131 (12,511) (26) (11,238) 37,489 (2,608) 49,074 37,215 (2,608) 49,382 - 24,678 25,050 - - 373 373 330 23 270 (826) - (373) (24,122) 556 (373) (6) (6) (24,122) 922 1,294 25,000 1,894 24,174 - 23 (23) 42 556 (1,616) (23) (1,018) 42 372 (270) - 23,384 24,678 23,156 25,050 Note: The transfer between stages are inclusive of net remeasurement allowances. 16 540 (1,652) (569) (48,244) 830 372 (6) (6) 366 At 1 April 2019 Transfer to Stage 3 New financial investments originated or purchased Financial investments derecognised other than write-off Changes due to change in credit risk Total charge to/(write-back from) income statement At 31 March 2020 Total RM'000 42 - BANK At 1 April 2020 New financial investments originated or purchased Financial investments derecognised other than write-off Changes due to change in credit risk Total write-back from income statement Write-off At 31 March 2021 Lifetime ECL Credit Impaired (Stage 3)
17. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A14 Financial Investments at Amortised Cost (Contd.) The Group's and the Bank's gross exposure of financial investments at amortised cost that are credit impaired are as follows: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 At beginning of financial year Impaired during the financial year Write-back during the financial year Write-off during the financial year At end of financial year A15 49,090 (48,244) 846 18,565 50,000 (16,867) (2,608) 49,090 BANK 31 March 2021 RM'000 24,678 (24,122) 556 31 March 2020 RM'000 1,294 25,000 (1,616) 24,678 Loans, Advances and Financing At amortised cost Overdrafts Term loans/financing - Housing loans/financing - Syndicated term loans/financing - Hire purchase receivables - Other term loans/financing Bills receivables Trust receipts Claims on customers under acceptance credits Staff loans (Loan to Directors: RM Nil [31 March 2020: RM Nil]) Credit/charge card receivables Revolving credits Share margin financing Gross loans, advances and financing Add: Sales commissions and handling fees Less: Allowance for expected credit losses on loans, advances and financing Total net loans, advances and financing GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 3,431,705 4,310,148 2,036,340 2,611,587 14,074,492 318,900 616,512 18,195,036 483,030 286,407 2,969,016 14,215,071 387,090 794,286 16,484,532 544,009 234,538 3,198,311 10,572,066 318,900 455,966 13,839,763 452,195 225,407 2,216,600 10,795,294 344,603 579,454 12,518,922 494,913 180,322 2,399,619 19,463 513,331 1,902,028 1,337,422 44,147,342 93,370 20,799 591,475 1,914,081 974,005 43,668,345 100,930 3,987 513,331 1,157,634 1,160,548 32,952,737 108,989 4,893 591,475 1,216,715 816,975 32,554,772 112,016 (1,007,206) 43,233,506 (659,268) 43,110,007 (666,599) 32,395,127 (459,243) 32,207,545 (a) The Bank has entered into an arrangement on Commodity Murabahah Term Financing (“CMTF”) with Alliance Islamic Bank Berhad (“AIS”), the Bank's wholly owned subsidiary. The contract is based on Wakalah principle where the Bank will provide the funds, while the assets are managed by AIS (as the Wakeel or agent). The risk and rewards of the underlying assets are recognised and borne by the Bank. Hence, the underlying assets and allowances for expected credit losses/impairment losses are recognised and accounted for by the Bank. The total loans, advances and financing for CMTF was at RM34,379,000 as at 31 March 2021 (31 March 2020: RM74,795,000). (b) As at 31 March 2021, the modification loss net off unwinding arising from the 6-month payment moratorium and Payment Relief Assistance amounting to RM68,319,000 and RM32,373,000 for the Group and the Bank respectively is netted off against the gross loans, advances and financing balance. 17
18. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A15 Loans, Advances and Financing (Contd.) A15a By maturity structure: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Within one year One year to three years Three years to five years Over five years Gross loans, advances and financing 11,166,171 1,719,702 3,116,175 28,145,294 44,147,342 12,002,775 1,818,830 2,566,390 27,280,350 43,668,345 BANK 31 March 2021 RM'000 7,928,048 1,271,822 2,513,766 21,239,101 32,952,737 31 March 2020 RM'000 8,492,153 1,420,933 1,839,745 20,801,941 32,554,772 A15b By type of customers: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Domestic banking institutions Domestic non-bank financial institutions Domestic business enterprises - Small and medium enterprises - Others Government and statutory bodies Individuals Other domestic entities Foreign entities Gross loans, advances and financing BANK 31 March 2021 RM'000 31 March 2020 RM'000 662,237 7 378,014 473,893 7 313,198 13,947,747 6,139,562 58,149 22,674,971 26,155 638,521 44,147,342 12,028,450 7,920,797 61,158 22,586,345 28,176 665,398 43,668,345 10,831,042 4,654,521 58,149 16,374,290 2,079 558,763 32,952,737 9,313,262 5,949,200 61,158 16,329,172 1,955 586,820 32,554,772 A15c By interest/profit rate sensitivity: Fixed rate - Housing loans/financing - Hire purchase receivables - Other fixed rate loans/financing Variable rate - Base lending rate plus - Base rate plus - Cost plus Gross loans, advances and financing 18 GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 26,509 604,335 7,022,940 29,878 779,425 6,491,640 4,815 443,788 4,940,093 5,717 564,614 4,348,004 24,074,135 8,515,744 3,903,679 44,147,342 24,771,256 7,296,462 4,299,684 43,668,345 19,597,887 5,086,299 2,879,855 32,952,737 20,145,220 4,293,863 3,197,354 32,554,772
19. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A15 Loans, Advances and Financing (Contd.) A15d By economic purposes: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Purchase of securities Purchase of transport vehicles Purchase of landed property of which: - Residential - Non-residential Purchase of fixed assets excluding land & buildings Personal use Credit card Construction Working capital Others Gross loans, advances and financing BANK 31 March 2021 RM'000 31 March 2020 RM'000 1,492,946 451,486 21,934,318 14,920,966 7,013,352 1,075,829 591,753 22,253,657 15,139,741 7,113,916 1,316,073 311,972 17,016,276 11,351,588 5,664,688 918,799 403,320 17,374,582 11,644,268 5,730,314 263,770 5,710,480 513,332 954,464 9,920,052 2,906,494 44,147,342 310,707 5,596,799 591,475 917,764 9,834,498 2,495,863 43,668,345 211,595 3,118,591 513,332 851,640 7,368,494 2,244,764 32,952,737 253,435 2,992,022 591,475 821,135 7,304,339 1,895,665 32,554,772 A15e By economic sectors: Primary agriculture Mining and quarring Manufacturing Electricity, gas and water Construction Wholesale, retail trade, restaurants and hotels Transport, storage and communication Financing, insurance, real estate and business services Community, social and personal services Household Others Gross loans, advances and financing GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 1,197,847 234,646 4,840,945 31,632 1,412,197 7,272,701 714,287 1,182,797 217,775 4,649,052 64,751 1,450,390 7,205,291 734,344 790,151 196,106 3,647,230 29,462 1,100,732 5,741,712 570,932 785,972 170,095 3,457,224 64,102 1,119,984 5,704,536 558,353 4,755,068 366,379 23,313,491 8,149 44,147,342 4,526,853 365,025 23,241,404 30,663 43,668,345 3,649,734 288,610 16,933,053 5,015 32,952,737 3,514,669 248,597 16,905,652 25,588 32,554,772 A15f By geographical distribution: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Northern region Central region Southern region Sabah region Sarawak region Gross loans, advances and financing 3,184,084 31,220,193 5,457,765 3,171,129 1,114,171 44,147,342 19 3,201,596 31,069,178 5,398,941 2,935,679 1,062,951 43,668,345 BANK 31 March 2021 RM'000 2,172,904 23,751,261 4,168,512 2,093,429 766,631 32,952,737 31 March 2020 RM'000 2,213,240 23,443,133 4,108,062 2,047,712 742,625 32,554,772
20. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A15 Loans, Advances and Financing (Contd.) A15g Movements in credit impaired loans, advances and financing ("impaired loans") in Stage 3: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 At beginning of financial year Impaired during the financial year Recovered during the financial year Reclassified as unimpaired during the financial year Financial assets derecognised other than write-off during the financial year Amount written-off At end of financial year Gross impaired loans ratio Net impaired loans ratio BANK 31 March 2021 RM'000 31 March 2020 RM'000 871,340 962,546 (47,121) 476,602 1,170,873 (76,964) 638,343 643,618 (34,657) 369,124 839,485 (64,860) (439,787) (441,903) (306,693) (336,748) (127,162) (187,380) 1,032,436 (100,252) (157,016) 871,340 (78,622) (126,421) 735,568 (64,291) (104,367) 638,343 2.34% 1.72% 2.00% 1.33% 2.23% 1.64% 1.96% 1.30% A15h Credit impaired loans analysed by economic purposes: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Purchase of transport vehicles Purchase of landed property of which: - Residential - Non-residential Purchase of fixed assets excluding land & buildings Personal use Credit card Construction Working capital Others Gross impaired loans 20 BANK 31 March 2021 RM'000 31 March 2020 RM'000 24,162 574,055 453,817 120,238 24,748 443,777 364,862 78,915 17,497 421,511 320,166 101,345 18,904 326,689 275,103 51,586 12,664 269,955 8,530 8,102 84,288 50,680 1,032,436 22,100 194,075 11,153 8,120 131,961 35,406 871,340 12,307 153,655 8,530 8,102 66,278 47,688 735,568 21,748 112,748 11,153 8,120 106,223 32,758 638,343
21. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A15 Loans, Advances and Financing (Contd.) A15i Credit impaired loans analysed by economic sectors: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Primary agriculture Mining and quarring Manufacturing Construction Wholesale, retail trade, restaurants and hotels Transport, storage and communication Financing, insurance, real estate and business services Community, social and personal services Household Others Gross impaired loans BANK 31 March 2021 RM'000 31 March 2020 RM'000 1,133 1,373 63,974 32,417 87,927 4,682 1,706 1,478 76,982 48,823 112,821 6,138 17 1,373 60,440 19,706 67,259 4,177 578 1,478 69,081 34,653 81,132 4,090 74,201 3,109 762,453 1,167 1,032,436 30,232 3,101 588,904 1,155 871,340 73,016 3,109 505,304 1,167 735,568 29,031 3,101 414,044 1,155 638,343 A15j Credit impaired loans by geographical distribution: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Northern region Central region Southern region Sabah region Sarawak region Gross impaired loans 77,759 764,325 142,789 37,812 9,751 1,032,436 21 85,202 623,066 118,968 32,649 11,455 871,340 BANK 31 March 2021 RM'000 52,270 543,371 107,890 24,456 7,581 735,568 31 March 2020 RM'000 60,317 449,333 94,908 24,474 9,311 638,343
22. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A15 Loans, Advances and Financing (Contd.) A15k Movements in allowance for expected credit losses on loans, advances and financing are as follows: GROUP At 1 April 2020 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to income statement Write-off At 31 March 2021 At 1 April 2019 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to income statement Write-off At 31 March 2020 12 months ECL (Stage 1) Lifetime ECL Not-credit Impaired (Stage 2) Lifetime ECL Credit Impaired (Stage 3) Total RM'000 RM'000 RM'000 RM'000 96,553 153,279 (101,032) (738) 77,896 (64,721) 69,812 (21) 134,475 134,475 (3) 231,025 269,287 (303,936) 483,008 (158,088) 178,021 (189,434) 220,087 (37) 229,621 229,621 (132) 498,776 293,428 (4,481) (76,882) 233,223 15,316 (35,550) (9,933) (13) 121,680 (7,853) 113,827 (129,850) 277,405 659,268 (155,138) 305,094 74,397 271,233 (289,705) 279,966 (71) 485,776 (7,853) 477,923 (129,985) 1,007,206 72,679 31,354 (44,896) (98) 57,681 (26,835) 6,655 16 23,877 23,877 (3) 96,553 212,519 (165,725) 286,244 (135,779) 139,436 (138,100) 71,828 33 57,937 57,937 (1,169) 269,287 217,465 (4,458) (105,254) 342,624 19,768 (27,367) (20,379) 12 204,946 (9,410) 195,536 (119,573) 293,428 502,663 (138,829) 136,094 206,747 216,885 (192,302) 58,104 61 286,760 (9,410) 277,350 (120,745) 659,268 22
23. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A15 Loans, Advances and Financing (Contd.) A15k Movements in allowance for expected credit losses on loans, advances and financing are as follows: (contd.) BANK At 1 April 2020 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to income statement Write-off At 31 March 2021 At 1 April 2019 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to income statement Write-off At 31 March 2020 12 months ECL (Stage 1) Lifetime ECL Not-credit Impaired (Stage 2) Lifetime ECL Credit Impaired (Stage 3) Total RM'000 RM'000 RM'000 RM'000 63,677 94,945 (62,825) (606) 53,856 (42,782) 48,000 (21) 90,567 90,567 (3) 154,241 177,196 (199,432) 300,659 (90,925) 139,571 (141,429) 129,081 (37) 137,488 137,488 (15) 314,669 218,370 (2,495) (50,694) 142,613 11,287 (24,205) (2,262) (13) 74,231 (4,550) 69,681 (90,362) 197,689 459,243 (106,982) 187,140 51,082 204,714 (208,416) 174,819 (71) 302,286 (4,550) 297,736 (90,380) 666,599 49,135 21,575 (29,604) (81) 35,395 (17,721) 4,962 16 14,542 14,542 63,677 142,622 (116,457) 197,930 (82,648) 113,212 (114,040) 37,191 33 35,221 35,221 (647) 177,196 171,332 (3,908) (75,350) 238,931 12,829 (18,108) (20,077) 12 134,329 (6,612) 127,717 (80,679) 218,370 363,089 (98,790) 92,976 156,202 161,436 (149,869) 22,076 61 184,092 (6,612) 177,480 (81,326) 459,243 Note: The transfer between stages are inclusive of net remeasurement allowances. 23
24. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A16 Other Assets GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Other receivables Collateral pledged for derivative transactions Settlement account Deposits Prepayment Amounts due from subsidiaries Amount due from joint venture Less: Allowance for expected credit losses on other receivables [Note (a)] BANK 31 March 2021 RM'000 31 March 2020 RM'000 98,079 61,381 128,658 8,834 36,788 194 333,934 65,827 137,005 56,352 8,984 32,495 171 300,834 120,168 61,381 128,658 8,210 33,220 32,397 323 384,357 50,114 136,767 56,352 8,330 29,361 18,680 309 299,913 (40,281) 293,653 (38,212) 262,622 (34,941) 349,416 (33,143) 266,770 Note: (a) Movements for allowance for expected credit losses on other receivables are as follows: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Lifetime ECL At beginning of financial year New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Total charge to income statement Write-off At end of financial year BANK 31 March 2021 RM'000 31 March 2020 RM'000 38,212 170 34,385 299 33,143 - 29,604 - (265) 2,181 2,086 (17) 40,281 (179) 3,707 3,827 38,212 1,815 1,815 (17) 34,941 3,539 3,539 33,143 As at 31 March 2021, the Group and the Bank's gross exposure of other receivables that are under lifetime expected credit losses was at RM40,281,000 and RM34,941,000 (31 March 2020: RM38,212,000 and RM33,143,000) respectively. 24
25. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A17 Deposits from Customers A17a By type of deposits: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Amortised cost Demand deposits Savings deposits Fixed/investment deposits Money market deposits Negotiable instruments of deposits 20,606,556 2,193,143 22,421,659 2,885,258 381,897 48,488,513 16,336,793 1,794,343 26,860,214 3,091,717 342,785 48,425,852 BANK 31 March 2021 RM'000 15,447,892 1,753,279 16,821,977 1,756,823 370,345 36,150,316 31 March 2020 RM'000 12,940,524 1,455,337 20,127,431 1,848,021 331,676 36,702,989 A17b The maturity structure of fixed/investment deposits, money market deposits and negotiable instruments of deposits are as follows: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Due within six months Six months to one year One year to three years Three years to five years 20,632,259 4,517,179 529,542 9,834 25,688,814 21,708,936 7,853,476 619,982 112,322 30,294,716 BANK 31 March 2021 RM'000 14,962,791 3,902,026 75,096 9,232 18,949,145 31 March 2020 RM'000 16,266,375 5,868,205 165,879 6,669 22,307,128 A17c By type of customers: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Domestic financial institutions Domestic non-bank financial institutions Government and statutory bodies Business enterprises Individuals Foreign entities Others 423,503 4,001,957 3,782,518 15,474,724 23,097,231 842,730 865,850 48,488,513 25 346,226 2,867,100 4,553,365 17,528,515 21,637,127 813,970 679,549 48,425,852 BANK 31 March 2021 RM'000 469,651 2,433,197 1,654,808 12,508,806 17,645,753 729,873 708,228 36,150,316 31 March 2020 RM'000 378,170 1,749,057 2,663,444 13,143,178 17,491,535 712,076 565,529 36,702,989
26. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A18 Deposits and Placements of Banks and Other Financial Institutions GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Licensed banks Licensed investment banks Bank Negara Malaysia 122,576 340,162 929,914 1,392,652 814,332 250,137 479,177 1,543,646 BANK 31 March 2021 RM'000 2,263 657,114 659,377 31 March 2020 RM'000 464,076 269,488 733,564 Included as part of Deposit and Placement of Banks and Other Financial Institutions is government financing scheme received by the Group and the Bank amounting to RM771,385,000 and RM601,385,000 respectively for the purpose of SMEs lending at a below market/concession rate. A19 Amounts Due To Clients And Brokers GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Due to clients Due to brokers 57,554 5,862 63,416 18,133 4,159 22,292 These mainly relate to amounts payable to non-margin clients and outstanding contracts entered into on behalf of clients where settlement via the Bursa Malaysia Securities Clearing Sdn. Bhd. has yet to be made. The Group's normal trade credit terms for trade payable for non-margin clients is two (2) market days according to the Bursa's FDSS trading rules. Following the issuance of FRSIC Consensus 18, the Group no longer recognises trust monies balances in the statement of financial position, as the Group does not have any control over the trust monies to obtain the future economic benefits embodied in the trust monies. The trust monies maintained by the Group amounting to RM123,393,000 (31 March 2020: RM100,252,000) have been excluded accordingly. 26
27. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A20 Financial Liabilities Designated at Fair Value Through Profit or Loss Structured investments designated at fair value for the Group and the Bank include investments with embeded equity linked options, interest rate index linked options and foreign currency options. The Group and the Bank have designated certain structured investments at fair value through profit or loss. The structured investments are recorded at fair value. The fair value changes of the structured investments that are attributable to the changes in own credit risk are not significant. GROUP/BANK 31 March 31 March 2021 2020 RM'000 RM'000 Structured investments Fair value changes arising from designation at fair value through profit or loss A21 504,651 (31,956) 472,695 451,999 (24,914) 427,085 Other Liabilities GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Other payables Bills payable Collateral pledged for derivative transactions Settlement account Clearing account Sundry deposits Provision and accruals Remisiers accounts Structured investments Amount due to subsidiaries Allowance for expected credit losses on commitments and contingencies 27 BANK 31 March 2021 RM'000 31 March 2020 RM'000 728,404 162,447 27,810 9,925 179,949 50,909 171,309 9,274 156,700 - 433,803 118,840 82,766 15,226 97,244 51,136 127,500 6,453 430,759 - 621,643 137,565 27,810 9,925 137,906 45,791 150,153 156,700 8,491 355,982 113,128 82,766 15,226 73,638 46,615 115,285 430,759 - 49,343 1,546,070 24,339 1,388,066 26,185 1,322,169 19,787 1,253,186
28. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A21 Other Liabilities (Contd.) Movements in allowance for expected credit losses on commitments and contingencies are as follows: GROUP At 1 April 2020 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to/(write-back from) income statement At 31 March 2021 At 1 April 2019 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to/(write-back from) income statement At 31 March 2020 12 months ECL (Stage 1) RM'000 Lifetime ECL Not-credit Impaired (Stage 2) RM'000 Lifetime ECL Credit Impaired (Stage 3) RM'000 Total RM'000 8,582 2,730 (1,293) 3,557 (3,130) (715) (9) 1,140 1,140 9,722 10,996 (7,701) 12,385 (1,143) 4,498 (5,193) 22,674 (4) 25,516 25,516 36,512 4,761 (101) (100) 2,745 (3,478) (614) (1,548) (104) (1,652) 3,109 24,339 (5,072) 10,992 1,602 8,055 (11,801) 21,345 (13) 25,108 (104) 25,004 49,343 6,833 2,266 (1,390) (1) 2,528 (1,636) (21) 3 1,749 1,749 8,582 16,664 (19,976) 15,583 (399) 7,732 (8,075) (541) 8 (5,668) (5,668) 10,996 9,107 (81) (647) 764 (4,391) 198 (4,157) (189) (4,346) 4,761 32,604 (17,791) 13,546 364 10,260 (14,102) (364) 11 (8,076) (189) (8,265) 24,339 28
29. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A21 Other Liabilities (Contd.) Movements in allowance for expected credit losses on commitments and contingencies are as follows: (contd.) BANK At 1 April 2020 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge/(write-back from) to income statement At 31 March 2021 At 1 April 2019 Transfer to Stage 1 Transfer to Stage 2 Transfer to Stage 3 New financial assets originated or purchased Financial assets derecognised other than write-off Changes due to change in credit risk Other adjustments Unwinding of discount Total charge to/(write-back from) income statement At 31 March 2020 12 months ECL (Stage 1) RM'000 Lifetime ECL Not-credit Impaired (Stage 2) RM'000 Lifetime ECL Credit Impaired (Stage 3) RM'000 Total RM'000 7,471 2,258 (1,115) 2,891 (2,717) (723) (9) 585 585 8,056 7,555 (6,408) 10,727 (355) 4,059 (4,084) 3,529 (3) 7,465 7,465 15,020 4,761 (101) (98) 1,125 (1,860) (614) (1,548) (104) (1,652) 3,109 19,787 (4,251) 9,514 770 6,950 (8,661) 2,192 (12) 6,502 (104) 6,398 26,185 6,097 1,821 (1,187) 2,174 (1,429) (7) 2 1,374 1,374 7,471 13,483 (16,370) 12,910 (399) 5,891 (7,265) (703) 8 (5,928) (5,928) 7,555 9,002 (80) (645) 759 (4,286) 207 (4,045) (196) (4,241) 4,761 28,582 (14,629) 11,078 360 8,065 (12,980) (503) 10 (8,599) (196) (8,795) 19,787 Note: a) As at 31 March 2021, the Group's and the Bank's gross exposure of commitments and contingencies that are credit impaired were RM14,824,000 and RM12,152,000 respectively (31 March 2020: RM8,829,000 and RM7,820,000). b) The transfer between stages are inclusive of net remeasurement of allowances. 29
30. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A22 Interest Income 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP Loans, advances and financing Money at call and deposit placements with financial institutions Financial investments at fair value through other comprehensive income Financial investments at amortised cost Others Accretion of discount less amortisation of premium (net) 330,268 409,509 1,392,203 1,647,131 2,388 3,158 30,612 13,905 73,733 16,827 37 423,253 82,035 1,201 59 495,962 320,203 38,640 638 1,782,296 318,454 6,818 364 1,986,672 (264) 422,989 19,767 515,729 11,125 1,793,421 83,215 2,069,887 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK Loans, advances and financing Money at call and deposit placements with financial institutions Financial investments at fair value through other comprehensive income Financial investments at amortised cost Others Accretion of discount less amortisation of premium (net) Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 324,556 398,402 1,367,348 1,614,037 2,637 3,657 32,683 15,934 65,130 18,590 37 410,950 73,703 2,985 59 478,806 286,130 45,790 638 1,732,589 292,218 12,866 364 1,935,419 (149) 410,801 19,350 498,156 11,282 1,743,871 83,950 2,019,369 Note: Included in the interest income on loans, advances and financing for the current financial period/year: (a) Interest/profit accrued on impaired loans/financing of the Group and the Bank of RM6,590,000 (31 March 2020: RM7,055,000) respectively. (b) During the financial year, the Group and the Bank granted an automatic moratorium on certain financing repayments/payments (except for credit card balances), by individuals and SMEs for a period of six months from 1 April 2020. In addition, the Group and the Bank also granted Payment Relief Assistance after the automatic moratorium ended. The automatic moratorium and Payment Relief Assistance were applicable to financing that are not in arrears exceeding 90 days and denominated in Malaysian Ringgit. This measure was to assist borrowers experiencing temporary financial constraints due to the COVID-19 pandemic. As a result of the payment moratorium, the Group and the Bank recognised a modification loss of RM32,373,000 arising from the modification of contractual cash flows of the financing. The Group and the Bank also received a government financing scheme for the purpose of on lending/financing to SMEs at below market/concession rate. The lending/financing by the Group and the Bank is to provide support for SMEs in sustaining business operations, safeguard jobs and encourage domestic investments during the COVID-19 pandemic. The benefit arising from the government financing scheme amounting to RM37,944,000 for the Group and the Bank respectively are applied to address the financial and accounting impact incurred for COVID-19 related relief measures. 30
31. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A23 Interest Expense 4th Quarter Ended GROUP Deposits and placements of banks and other financial institutions Deposits from customers Recourse obligations on loans and financing sold to Cagamas Subordinated obligations Lease liabilities Others 31 March 2021 RM'000 31 March 2020 RM'000 31 March 2021 RM'000 31 March 2020 RM'000 6,211 127,411 8,339 226,399 18,013 653,548 33,178 946,241 3,352 15,305 1,643 1,732 155,654 3,389 21,049 951 1,142 261,269 13,591 76,971 6,741 7,901 776,765 13,627 84,538 6,577 4,892 1,089,053 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK Deposits and placements of banks and other financial institutions Deposits from customers Recourse obligations on loans and financing sold to Cagamas Subordinated obligations Lease liabilities Others 31 Financial Year Ended Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 3,872 125,768 3,842 221,889 9,647 645,231 14,977 921,624 3,352 15,369 1,642 1,732 151,735 3,389 21,088 950 1,142 252,300 13,591 77,248 6,738 7,901 760,356 13,627 84,732 6,572 4,892 1,046,424
32. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A24 Net Income from Islamic Banking Business 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP Income derived from investment of depositors' funds and others Income derived from investment of Islamic Banking funds Income attributable to the depositors and financial institutions Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 143,585 161,182 607,850 647,244 15,292 15,584 63,093 64,966 (61,178) 97,699 (84,740) 92,026 (292,443) 378,500 (334,314) 377,896 Note: (a) Net income from Islamic Banking business comprises income generated from Alliance Islamic Bank Berhad ("AIS"), and Islamic banking business of Alliance Investment Bank Berhad ("AIBB"). Both AIS and AIBB are wholly-owned subsidiaries of the Bank. (b) During the financial year, the Group granted an automatic moratorium on certain financing repayments/payments, by individuals and SMEs for a period of six months from 1 April 2020. In addition, the Group also granted Payment Relief Assistance after the automatic moratorium ended. The automatic moratorium and Payment Relief Assistance were applicable to financing that are not in arrears exceeding 90 days and denominated in Malaysian Ringgit. This measure was to assist borrowers experiencing temporary financial constraints due to the COVID-19 pandemic. As a result of the payment moratorium, the Group recognised a modification loss of RM35,946,000 arising from the modification of contractual cash flows of the financing. The Group also received a government financing scheme for the purpose of on lending/financing to SMEs at below market/concession rate. The lending/financing by the Group is to provide support for SMEs in sustaining business operations, safeguard jobs and encourage domestic investments during the COVID-19 pandemic. The benefit arising from the government financing scheme amounting to RM39,074,000 is applied to address the financial and accounting impact incurred for COVID-19 related relief measures. 32
33. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A25 Other Operating Income 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP (a) Fee and commission income: Commissions Service charges and fees Corporate advisory fees Underwriting commissions Brokerage fees Guarantee fees Processing fees Commitment fees Cards related income Other fee income (b) Fee and commission expense: Commissions expense Service charges and fees expense Brokerage fees expense Guarantee fees expense Cards related expense (c) Investment income: Realised gain/(loss) arising from sale/redemption of: - Financial assets at fair value through profit or loss - Financial investments at fair value through other comprehensive income - Derivative instruments - Other investments Marked-to-market revaluation gain/(loss): - Financial assets at fair value through profit or loss - Derivative instruments - Financial liabilities designated at fair value through profit or loss Gross dividend income from: - Financial assets at fair value through profit or loss (d) Other income/(expense): Foreign exchange gain/(loss) Rental income Gain on disposal of property, plant and equipment Others Total other operating income 33 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 31,033 5,818 1,006 61 17,284 3,186 1,078 4,704 16,584 2,001 82,755 28,769 5,964 1,018 445 7,913 4,016 1,896 4,458 17,758 1,500 73,737 99,845 26,287 3,718 1,484 69,186 13,738 4,417 18,899 68,380 8,003 313,957 93,500 29,837 3,502 2,205 26,558 14,704 9,604 17,544 79,815 6,003 283,272 (819) (447) (7,630) (3,510) (17,179) (29,585) (681) (264) (2,815) (2,037) (16,329) (22,126) (2,574) (1,417) (30,024) (11,322) (66,286) (111,623) (5,223) (1,025) (8,859) (4,405) (67,606) (87,118) (1,851) 6,970 10,405 15,481 8,030 (15,635) - 635 (93,335) - 87,750 186,423 (5) 17,634 (25,430) 5 534 15,916 284 72,990 30,121 (74,657) 23,207 63,991 15,219 17,846 7,042 (11,742) 22,213 5,390 1,480 248,559 4,419 87,565 1,152 46 20,895 28 (44,362) 151 22,712 196 4,199 5,397 5,319 4,680 30,922 15,729 (28,482) 5,319 18,644 46,871 80,780 87,923 422,411 330,590
34. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A25 Other Operating Income (Contd.) 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK (a) Fee and commission income: Commissions Service charges and fees Guarantee fees Processing fees Commitment fees Cards related income Other fee income (b) Fee and commission expense: Commissions expense Service charges and fees expense Brokerage fees expense Guarantee fees expense Cards related expense (c) Investment income: Realised gain/(loss) arising from sale/redemption of: - Financial assets at fair value through profit or loss - Financial investments at fair value through other comprehensive income - Derivative instruments - Other investments Marked-to-market revaluation gain/(loss): - Financial assets at fair value through profit or loss - Derivative instruments - Financial liabilities designated at fair value through profit or loss Gross dividend income from: - Financial assets at fair value through profit or loss - Subsidiaries (d) Other income/(expense): Foreign exchange gain/(loss) Rental income Gain on disposal of property, plant and equipment Others Total other operating income 34 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 31,033 5,542 3,179 522 4,704 16,584 2,000 63,564 28,769 5,830 4,010 1,932 4,453 17,758 1,500 64,252 99,845 25,234 13,711 2,540 18,899 68,380 8,000 236,609 93,500 29,290 14,678 7,710 17,500 79,815 6,000 248,493 (819) (447) (12) (3,510) (17,179) (21,967) (681) (264) (13) (2,037) (16,329) (19,324) (2,574) (1,417) (66) (11,322) (66,286) (81,665) (5,634) (1,025) (30) (4,405) (67,606) (78,700) (1,851) 6,970 10,405 15,361 8,030 (15,635) - 635 (93,335) - 75,953 186,423 (5) 14,402 (25,430) 5 534 15,916 284 72,990 24,319 (74,657) 19,599 63,991 15,219 17,846 7,042 (11,742) 22,213 5,390 931 238,929 469,340 2,668 48,031 126,885 785 534 20,785 479 (45,368) 1,854 22,343 2,316 4,030 5,349 5,319 4,559 31,142 14,969 (28,545) 5,319 18,034 48,012 69,159 81,460 595,739 344,690
35. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A26 Other Operating Expenses 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP Personnel costs - Salaries, allowances and bonuses - Contribution to EPF - Others Establishment costs - Depreciation of property, plant and equipment - Depreciation of right-of-use assets - Amortisation of computer software - Rental of premises - Water and electricity - Repairs and maintenance - Information technology expenses - Others Marketing expenses - Promotion and advertisement - Branding and publicity - Others Administration and general expenses - Communication expenses - Printing and stationery - Insurance - Professional fees - Others Total other operating expenses 35 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 105,038 16,499 19,440 140,977 97,980 15,980 11,832 125,792 396,117 64,150 51,390 511,657 398,200 64,472 53,402 516,074 5,713 6,318 10,466 429 1,636 2,686 19,572 2,906 49,726 5,103 5,661 9,545 170 1,841 2,698 18,014 2,643 45,675 21,479 25,363 41,558 2,017 6,790 10,154 65,022 10,847 183,230 22,661 24,259 36,864 1,872 7,782 9,969 69,434 10,680 183,521 4,340 4,040 1,025 9,405 6,458 4,358 1,828 12,644 15,509 8,503 4,478 28,490 11,489 12,071 7,719 31,279 3,678 504 592 19,602 7,651 32,027 3,433 643 3,032 6,672 7,521 21,301 13,107 1,812 5,943 36,072 20,347 77,281 10,835 2,352 11,682 27,472 23,804 76,145 232,135 205,412 800,658 807,019
36. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A26 Other Operating Expenses (Contd.) 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK Personnel costs - Salaries, allowances and bonuses - Contribution to EPF - Others Establishment costs - Depreciation of property, plant and equipment - Depreciation of right-of-use assets - Amortisation of computer software - Rental of premises - Water and electricity - Repairs and maintenance - Information technology expenses - Others Marketing expenses - Promotion and advertisement - Branding and publicity - Others Administration and general expenses - Communication expenses - Printing and stationery - Insurance - Professional fees - Others Total other operating expenses 36 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 76,251 11,937 9,632 97,820 74,006 12,123 8,417 94,546 297,234 48,426 35,268 380,928 302,135 49,103 41,224 392,462 5,045 6,307 10,162 305 1,207 2,235 11,017 3,293 39,571 4,983 5,649 9,166 176 1,337 2,071 12,904 130 36,416 20,470 25,319 40,120 1,734 5,031 7,988 38,977 7,183 146,822 22,110 24,213 35,366 1,126 5,785 7,868 51,048 658 148,174 2,766 2,647 608 6,021 5,259 3,070 1,167 9,496 13,682 5,794 2,720 22,196 9,339 8,267 5,081 22,687 2,573 407 592 15,698 12,396 31,666 2,534 512 2,588 4,666 5,111 15,411 9,718 1,407 5,048 28,426 21,970 66,569 8,113 1,823 10,091 20,666 17,213 57,906 175,078 155,869 616,515 621,229
37. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A27 Allowance for Expected Credit Losses on Loans, Advances and Financing and Other Financial Assets 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP Allowance for expected credit losses on: (a) Loans, advances and financing - Allowance made during the financial period/year (b) Credit impaired loans, advances and financing - Recovered during the financial period/year - Write-off during the financial period/year (c) Commitments and contingencies on loans, advances and financing - Allowance made/(write-back) during the financial period/year 113,778 Allowance for/(write-back of) expected credit losses on: - Amounts due from clients and brokers - Other receivables - Cash and short-term funds - Deposits and placements with banks and other financial institutions 101,189 (39,347) 59,273 (46,063) 36,820 8,479 135,999 (4,659) 97,486 25,108 530,810 (8,076) 269,441 3 900 98,389 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 (3) 2,086 19 4 532,916 3 3,827 (37) 273,234 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 72,479 63,181 302,286 184,092 (10,294) 16,581 (5,012) 5,324 (28,672) 37,455 (32,889) 22,389 (466) 78,300 (4,671) 58,822 6,502 317,571 (8,599) 164,993 809 - 1,815 19 3,539 (37) 59,631 4 319,409 553 10 (4) 78,859 37 286,760 (7,751) 8,707 (4) 136,581 Allowance for/(write-back of) expected credit losses on: - Other receivables - Cash and short-term funds - Deposits and placements with banks and other financial institutions 485,776 (13,580) 27,322 576 10 BANK Allowance for expected credit losses on: (a) Loans, advances and financing - Allowance made during the financial period/year (b) Credit impaired loans, advance and financing - Recovered during the financial period/year - Write-off during the financial period/year (c) Commitments and contingencies on loans, advances and financing - (Write-back)/allowance made during the financial period/year Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 168,495
38. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A28 (Write-back of)/Allowance for Expected Credit Losses on Financial Investments 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP (a) Financial investments at fair value through other comprehensive income - Write-back during the financial period/year (b) Financial investments at amortised cost - Allowance/(write-back) during the financial period/year - Commitment and contingencies (211) (42) (19) 102 (109) (356) (9) (407) 115 96 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK (a) Financial investments at fair value through other comprehensive income - Write-back during the financial period/year (b) Financial investments at amortised cost - (Write-back)/allowance made during the financial period/year A29 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 (218) 37,215 36,997 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 (119) (26) (47) (107) (226) (319) (345) (6) (53) (160) 23,156 22,996 Allowance for Impairment Losses on Non-Financial Assets 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP Intangible assets - goodwill - 631 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK Intangible assets - goodwill - 38 306 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 - 4,317 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 - 306
39. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A30 Commitments and Contingencies The off-balance sheet exposures and their related counterparty credit risk of the Group and the Bank are as follows: GROUP 31 March 2021 RM'000 Commitments and contingencies Direct credit substitutes Transaction-related contingent items Short-term self-liquidating traderelated contingencies Forward assets purchase Obligations under an on-going underwriting agreement Irrevocable commitments to extend credit: - maturity exceeding one year - maturity not exceeding one year Unutilised credit card lines Derivative financial instruments Foreign exchange related contracts: - one year or less - over one year to three years - over three years Interest rate related contracts: - one year or less - over one year to three years - over three years Equity related contracts - one year or less - over one year to three years - over three years 39 31 March 2020 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 687,790 554,612 814,317 621,684 511,039 492,119 622,481 559,957 145,128 20,800 130,924 - 119,337 20,800 110,898 - 20,000 51,150 - - 867,310 9,625,561 1,299,366 13,220,567 1,239,933 9,273,334 1,356,566 13,487,908 711,536 7,335,855 1,299,366 10,490,052 871,143 7,139,788 1,356,566 10,660,833 7,718,029 681,661 661,606 12,470,667 621,349 315,762 7,718,029 681,661 661,606 12,470,667 621,349 315,762 2,099,218 3,984,245 1,492,030 3,505,421 3,386,675 2,230,984 2,099,218 3,984,245 1,492,030 3,505,421 3,386,675 2,230,984 295,184 214,860 17,146,833 533,770 273,868 145,300 23,483,796 295,184 214,860 17,146,833 533,770 273,868 145,300 23,483,796 30,367,400 36,971,704 27,636,885 34,144,629
40. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A31 Segment Information The following segment information has been prepared in accordance with MFRS 8 Operating Segments, which defines the requirements for the disclosure of financial information of an entity's operating segments. The operating segments results are prepared and provided to the chief operating decision maker based on the Group's internal management reporting reflective of the organisation's management reporting structure. Based on the results presented to chief operating decision maker, funds are allocated between segments and intersegment funding cost transfers are reflected in net interest income. In addition to the operating segments, the segment information disclosed also includes inter-segment eliminations. Transactions between reportable segments are eliminated based on principles of consolidation as described in accounting policy. Intercompany transactions, balances and unrealised gains and losses on transactions between Group's companies are eliminated in intersegment eliminations. The Group is organised into the following key operating segments: (i) Consumer Banking Consumer Banking provides a wide range of personal banking solutions covering mortgages, term loans, personal loans, hire purchase facilities, credit cards and wealth management (cash management, investment services, share trading, bancassurance and will writing). Consumer Banking customers are serviced via branch network, call centre, electronic/internet banking channels, and direct sales channels. (ii) Business Banking Business Banking segment covers Small and Medium Enterprise ("SME"), Corporate and Commercial Banking. SME Banking customers comprise self-employed, small and medium scale enterprises. Corporate and Commercial Banking serves public-listed and large corporate business customers including family-owned businesses. Business Banking provides a wide range of products and services including loans, trade finance, cash management, treasury and structured solutions. (iii) Financial Markets Financial Markets provide foreign exchange, money market, hedging and investment (capital market instruments) solutions for banking customers. It also manages the assets and liabilities, liquidity and statutory reserve requirements of the banking entities in the Group. (iv) Stockbroking and Corporate Advisory Stockbroking and Corporate Advisory covers stockbroking activities and corporate advisory which includes initial public offering, equity fund raising, debt fund raising, mergers and acquisitions and corporate restructuring. (v) Others Others refer to mainly other business operations such as alternative distribution channels, trustee services and head office. 40
41. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A31 Segment information (Contd.) GROUP 4th Quarter ended 31 March 2021 Net interest income - external income - inter-segment Net income from Islamic banking business Other operating income Net income Other operating expenses Depreciation and amortisation Operating profit/(loss) (Allowance for)/write-back of expected credit losses on loans, advances and other financial assets Write-back of/(allowance for) expected credit losses on financial investments Segment result Share of results of joint venture Taxation Net profit for the financial period Segment assets Reconciliation of segment assets to consolidated assets: Investment in joint venture Property, plant and equipment Tax recoverable and deferred tax assets Intangible assets Total assets Consumer Banking RM'000 Business Banking RM'000 Financial Markets RM'000 89,542 (4,989) 84,553 41,932 33,265 159,750 (94,707) (10,092) 54,951 114,408 2,871 117,279 30,792 31,233 179,304 (75,302) (9,389) 94,613 60,546 2,889 63,435 23,181 4,238 90,854 (14,165) (2,197) 74,492 (87,619) (48,976) (2) (32,668) 766 46,403 338 74,828 27,449,428 11,474,860 22,054,323 Stockbroking and Corporate Advisory RM'000 1,681 (771) 910 11,985 12,895 (13,511) (1,102) (1,718) 16 (130) (1,832) 359,446 Others RM'000 14 14 17 12,120 12,151 (21,192) (101) (9,142) (735) (9,877) 440,154 Total Operations RM'000 266,191 266,191 95,922 92,841 454,954 (218,877) (22,881) 213,196 (136,581) Inter-segment Elimination RM'000 1,144 1,144 1,777 (12,061) (9,140) 9,239 384 483 - 239 76,854 (130) 353 61,778,211 (1,720,990) Total RM'000 267,335 267,335 97,699 80,780 445,814 (209,638) (22,497) 213,679 (136,581) 109 77,207 18 (27,153) 50,072 60,057,221 994 57,264 174,457 431,259 60,721,195 41
42. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A31 Segment information (Contd.) GROUP Full Year ended 31 March 2021 Net interest income - external income - inter-segment Net income from Islamic banking business Other operating income Net income Other operating expenses Depreciation and amortisation Operating profit/(loss) (Allowance for)/write-back of expected credit losses on loans, advances and financing and other financial assets Write-back of/(allowance for) expected credit losses on financial assets Segment result Share of results of joint venture Taxation Net profit for the financial period Segment assets Reconciliation of segment assets to consolidated assets: Investment in joint venture Property, plant and equipment Tax recoverable and deferred tax assets Intangible assets Total assets Consumer Banking RM'000 Business Banking RM'000 Financial Markets RM'000 316,343 21,807 338,150 165,601 112,321 616,072 (338,029) (40,360) 237,683 436,632 41,058 477,690 125,908 128,101 731,699 (266,219) (37,473) 428,007 (377,335) (155,978) (139,652) 753 272,782 250 352,326 27,449,428 11,474,860 22,054,323 258,542 (59,521) 199,021 69,861 135,925 404,807 (44,274) (8,704) 351,829 247 Stockbroking and Corporate Advisory RM'000 7,184 (3,344) 3,840 49,563 53,403 (37,714) (3,024) 12,665 150 (130) 12,685 359,446 Others RM'000 76 76 86 20,376 20,538 (36,095) (411) (15,968) (735) (16,703) 440,154 Total Operations RM'000 1,018,777 1,018,777 361,456 446,286 1,826,519 (722,331) (89,972) 1,014,216 (532,916) Inter-segment Elimination RM'000 (2,121) (2,121) 17,044 (23,875) (8,952) 10,073 1,572 2,693 - 138 481,438 (234) 2,459 61,778,211 (1,720,990) Total RM'000 1,016,656 1,016,656 378,500 422,411 1,817,567 (712,258) (88,400) 1,016,909 (532,916) (96) 483,897 91 (125,203) 358,785 60,057,221 994 57,264 174,457 431,259 60,721,195 42
43. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A31 Segment information (Contd.) GROUP 4th Quarter ended 31 March 2020 Net interest income - external income - inter-segment Net income from Islamic banking business Other operating income Net income Other operating expenses Depreciation and amortisation Operating profit/(loss) (Allowance for)/write-back of expected credit losses on loans, advances and financing and other financial assets (Allowance for)/write-back of expected credit losses on financial investments Allowance for impairment losses on non-financial assets Segment result Share of results of joint venture Taxation Net profit for the financial period Segment assets Reconciliation of segment assets to consolidated assets: Investment in joint venture Property, plant and equipment Tax recoverable and deferred tax assets Intangible assets Total assets Consumer Banking RM'000 Business Banking RM'000 Financial Markets RM'000 98,170 (7,061) 91,109 41,886 24,098 157,093 (89,182) (9,484) 58,427 96,083 18,160 114,243 29,919 40,354 184,516 (71,081) (8,624) 104,811 (79,186) (19,016) 24 (212) (1,005) (261) 936 (20,759) 24,115,445 57,057 (9,438) 47,619 13,745 10,860 72,224 (10,713) (1,832) 59,679 Stockbroking and Corporate Advisory RM'000 84,790 59,442 25,558,326 12,242,497 2,772 (1,661) 1,111 7,464 8,575 (9,774) (633) (1,832) (3,928) (5,036) 269,954 Others RM'000 71 71 33 9,622 9,726 (4,422) (105) 5,199 1 735 5,935 47,365 Total Operations RM'000 254,153 254,153 85,583 92,398 432,134 (185,172) (20,678) 226,284 (98,389) 405 (3,928) 124,372 62,233,587 Inter-segment Elimination RM'000 307 307 6,443 (4,475) 2,275 69 369 2,713 2 3,297 6,012 (1,859,561) Total RM'000 254,460 254,460 92,026 87,923 434,409 (185,103) (20,309) 228,997 (98,389) 407 (631) 130,384 17 (32,344) 98,057 60,374,026 903 64,486 98,959 437,086 60,975,460 43
44. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A31 Segment information (Contd.) GROUP Full Year ended 31 March 2020 Net interest income - external income - inter-segment Net income from Islamic banking business Other operating income Net income Other operating expenses Depreciation and amortisation Operating profit/(loss) (Allowance for)/write-back of expected credit losses on loans, advances and financing and other financial assets (Allowance for)/write-back of expected credit losses on financial investments Allowance for impairment losses on non-financial assets Segment result Share of results of joint venture Taxation Net profit for the financial period Segment assets Reconciliation of segment assets to consolidated assets: Investment in joint venture Property, plant and equipment Tax recoverable and deferred tax assets Intangible assets Total assets Consumer Banking RM'000 Business Banking RM'000 Financial Markets RM'000 397,303 (50,798) 346,505 160,735 101,271 608,511 (343,113) (39,656) 225,742 370,302 81,828 452,130 117,754 161,209 731,093 (276,305) (35,105) 419,683 (218,220) (54,807) 152 (360) (38,584) (74) 936 - 228,099 (23,099) 205,000 61,477 35,096 301,573 (47,969) (7,593) 246,011 Stockbroking and Corporate Advisory RM'000 7,522 326,292 246,089 24,115,445 25,558,326 12,242,497 13,043 (7,931) 5,112 27,385 32,497 (38,062) (2,633) (8,198) Others RM'000 281 281 165 22,978 23,424 (18,101) (492) 4,831 Total Operations RM'000 1,009,028 1,009,028 340,131 347,939 1,697,098 (723,550) (85,479) 888,069 Inter-segment Elimination RM'000 (28,194) (28,194) 37,765 (17,349) (7,778) 315 1,695 (5,768) 980,834 980,834 377,896 330,590 1,689,320 (723,235) (83,784) 882,301 1 (273,234) 735 (36,987) (10) (36,997) (9,230) (16,852) 5,567 (9,230) 568,618 4,913 (865) (4,317) 567,753 101 (143,591) 424,263 269,954 47,365 62,233,587 - Total RM'000 (1,859,561) (273,234) 60,374,026 903 64,486 98,959 437,086 60,975,460 44
45. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A32 Capital Adequacy The capital adequacy ratios of the Group and the Bank are computed in accordance with Bank Negara Malaysia's Capital Adequacy Framework. The Framework sets out the approach for computing regulatory capital adequacy ratios, as well as the levels of those ratios at which banking institutions are required to operate. The Framework is to strengthen capital adequacy standards, in line with the requirements set forth under Basel III. The risk-weighted assets of the Group and the Bank are computed using the Standardised Approach for credit risk and market risk, and the Basic Indicator Approach for operational risk. The Group and the Bank have also adopted the transitional arrangements on provisions for expected credit losses in accordance with Bank Negara Malaysia's Transitional Arrangements for Regulatory Capital Treatment of Accounting Provisions effective on 9 December 2020. This allow the Group and the Bank to add back a portion of Stage 1 (S1) and Stage 2 (S2) provisions with an “addback factor”, to the CET1 capital from Financial Year 2021 to Financial Year 2024. The capital adequacy ratios with and without transitional arrangements for the Group and the Bank are as follows: GROUP 31 March 31 March 2021 2020 BANK 31 March 2021 31 March 2020 (i) With transitional arrangements Before deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 16.463% 17.418% 21.816% - 15.654% 16.566% 21.549% - After deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 16.218% 17.173% 21.571% - 15.327% 16.238% 21.222% - (ii) Without transitional arrangements Before deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 15.232% 16.187% 20.588% 13.826% 14.593% 18.902% 14.646% 15.557% 20.582% 12.899% 13.771% 18.634% After deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 14.987% 15.942% 20.343% 13.826% 14.593% 18.902% 14.318% 15.230% 20.255% 12.899% 13.771% 18.634% 45
46. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A32 Capital Adequacy (Contd.) (a) Components of Common Equity Tier I ("CET I"), Tier I and Tier II capital under the Capital Adequacy Framework with transitional arrangements are as follows: CET I Capital/Tier I Capital Paid-up share capital Retained profits Regulatory reserves FVOCI reserves Capital reserves (Less)/add: Regulatory adjustments - Goodwill and other intangibles - Deferred tax assets - 55% of FVOCI reserves - Regulatory reserves - Investment in subsidiaries, associate and joint venture - Transitional arrangements Total CET I Capital Additional Tier I Capital Securities Total Additional Tier I Capital Total Tier I Capital Tier II Capital Subordinated obligations Expected credit losses and regulatory reserves Less: Regulatory adjustment - Investment in Tier II capital instruments Total Tier II Capital Total Capital GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 1,548,106 4,471,771 86,440 50,993 100,150 6,257,460 1,548,106 3,985,966 80,006 (5,082) 15,515 5,624,511 1,548,106 3,346,890 182,292 79,612 15,515 5,172,415 1,548,106 3,974,847 224,579 140,966 100,150 5,988,648 (431,259) (130,100) (28,046) (86,440) (437,086) (28,125) (77,531) (224,579) (329,004) (95,200) (80,006) (332,680) (14,074) (43,787) (182,292) (994) 451,004 6,031,625 (903) 5,220,424 (1,109,102) 276,161 4,287,360 (909,102) 3,690,480 349,899 349,899 289,844 289,844 249,732 249,732 249,584 249,584 6,381,524 5,510,268 4,537,092 3,940,064 1,199,077 1,199,829 1,198,554 1,199,719 412,255 427,020 296,396 321,754 1,611,332 1,626,849 (130,000) 1,364,950 (130,000) 1,391,473 7,992,856 7,137,117 5,902,042 5,331,537 (b) The breakdown of risk-weighted assets ("RWA") by exposures in each major risk category are as follows: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 Credit risk Market risk Operational risk Total RWA and capital requirements 33,065,592 322,652 3,249,393 36,637,637 46 34,161,647 472,308 3,125,054 37,759,009 BANK 31 March 2021 RM'000 24,611,480 322,331 2,454,737 27,388,548 31 March 2020 RM'000 25,740,333 472,308 2,398,815 28,611,456
47. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A32 Capital Adequacy (Contd.) (c) The capital adequacy ratios of the banking subsidiaries are as follows: Alliance Islamic Bank Berhad 31 March 31 March 2021 2020 Alliance Investment Bank Berhad 31 March 31 March 2021 2020 (i) With transitional arrangements Before deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 15.035% 16.158% 18.783% - 72.580% 72.580% 73.506% - After deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 15.035% 16.158% 18.783% - 69.000% 69.000% 69.926% - (ii) Without transitional arrangements Before deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 13.065% 14.188% 16.813% 10.507% 11.617% 14.233% 72.550% 72.550% 73.476% 98.737% 98.737% 99.682% After deducting proposed dividends CET I capital ratio Tier I capital ratio Total capital ratio 13.065% 14.188% 16.813% 10.507% 11.617% 14.233% 68.970% 68.970% 69.896% 97.246% 97.246% 98.190% 47
48. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A33 Fair Value Measurements (a) Determination of fair value and fair value hierarchy MFRS 13 Fair Value Measurement requires disclosure of financial instruments measured at fair value to be categorised according to a hierarchy of valuation techniques, whether the inputs used are observable or unobservable. The following level of hierarchy are used for determining and disclosing the fair value of the financial instruments: Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs). The Group and the Bank recognise transfers between levels of the fair value hierarchy at the end of the reporting period during which the transfer has occurred. The fair value of an asset to be transferred between levels is determined as of the date of the event or change in circumstances that caused the transfer. (i) Financial instruments in Level 1 The fair value of financial instruments traded in active markets is based on quoted market prices at the statements of financial position date. A market is regarded as active if quoted prices are readily and regularly available from an exchange and those prices represent actual and regularly occurring market transactions on an arm’s length basis. This includes listed equities and corporate debt securities which are actively traded. (ii) Financial instruments in Level 2 Where fair value is determined using quoted prices in less active markets or quoted prices for similar assets and liabilities, such instruments are generally classified as Level 2. In cases where quoted prices are generally not available, the Group and the Bank then determine fair value based upon valuation techniques that use as inputs, market parameters including but not limited to yield curves, volatilities and foreign exchange rates. The majority of valuation techniques employ only observable market data and so reliability of the fair value measurement is high. These would include government securities, corporate private debt securities, corporate notes and most of the Group's and the Bank's derivatives. (iii) Financial instruments in Level 3 The Group and the Bank classify financial instruments as Level 3 when there is reliance on unobservable inputs to the valuation model attributing to a significant contribution to the instrument value. Valuation reserves or pricing adjustments where applicable will be used to converge to fair value. The valuation techniques and inputs used generally depend on the contractual terms and the risks inherent in the instrument as well as the availability of pricing information in the market. Principal techniques used include net tangible assets, net asset value, discounted cash flows, and other appropriate valuation models. These includes private equity investments. 48
49. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A33 Fair Value Measurements (Contd.) (b) Financial instruments measured at fair value and the fair value hierarchy The following tables show the Group's and the Bank's financial instruments which are measured at fair value at the reporting date analysed by the various levels within the fair value hierarchy: GROUP 31 March 2021 Level 1 RM'000 Level 2 RM'000 Level 3 RM'000 Total RM'000 - 13,246 - 224,676 13,246 224,676 15 - 5,479,233 4,945,421 - 5,479,233 15 4,945,421 Derivative financial assets - 153,735 - 153,735 Liabilities Financial liabilities designated at fair value through profit or loss - 472,695 - 472,695 Derivative financial liabilities - 149,410 - 149,410 Level 1 RM'000 Level 2 RM'000 Level 3 RM'000 Total RM'000 - 13,246 - 154,482 13,246 154,482 15 - 4,202,184 3,101,667 - 4,202,184 15 3,101,667 Derivative financial assets - 153,735 - 153,735 Liabilities Financial liabilities designated at fair value through profit or loss - 472,695 - 472,695 Derivative financial liabilities - 149,410 - 149,410 Assets Financial assets at fair value through profit or loss - Money market instruments - Unquoted securities Financial investments at fair value through other comprehensive income - Money market instruments - Quoted securities in Malaysia - Unquoted securities BANK 31 March 2021 Assets Financial assets at fair value through profit or loss - Money market instruments - Unquoted securities Financial investments at fair value through other comprehensive income - Money market instruments - Quoted securities in Malaysia - Unquoted securities 49
50. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A33 Fair Value Measurements (Contd.) (b) Financial instruments measured at fair value and the fair value hierarchy (contd.) The following tables show the Group's and the Bank's financial instruments which are measured at fair value at the reporting date analysed by the various levels within the fair value hierarchy (contd.): GROUP 31 March 2020 Level 1 RM'000 Level 2 RM'000 Level 3 RM'000 Total RM'000 Assets Financial assets at fair value through profit or loss - Money market instruments - Unquoted securities - 437,929 10,025 202,160 437,929 212,185 Financial investments at fair value through other comprehensive income - Money market instruments - Quoted securities in Malaysia - Unquoted securities 5 - 6,476,810 5,067,692 - 6,476,810 5 5,067,692 Derivative financial assets - 436,910 - 436,910 Liabilities Financial liabilities designated at fair value through profit or loss - 427,085 - 427,085 Derivative financial liabilities - 348,877 - 348,877 Level 1 RM'000 Level 2 RM'000 Level 3 RM'000 Total RM'000 Assets Financial assets at fair value through profit or loss - Money market instruments - Unquoted securities - 437,929 10,025 137,768 437,929 147,793 Financial investments at fair value through other comprehensive income - Money market instruments - Quoted securities in Malaysia - Unquoted securities 5 - 5,403,416 3,023,357 - 5,403,416 5 3,023,357 Derivative financial assets - 436,910 - 436,910 Liabilities Financial liabilities designated at fair value through profit or loss - 427,085 - 427,085 Derivative financial liabilities - 348,877 - 348,877 BANK 31 March 2020 50
51. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A33 Fair Value Measurements (Contd.) (b) Financial instruments measured at fair value and the fair value hierarchy (contd.) Reconciliation of movements in Level 3 financial instruments: GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 At beginning of financial year Partial distribution on liquidating shares Total gain recognised in: - Statement of income (i) Revaluation gain from financial assets at fair value through profit or loss 202,160 (243) 187,517 (106) 137,768 (243) 126,733 (106) 22,759 14,749 16,957 11,141 At end of financial year 224,676 202,160 154,482 137,768 The Group's and the Bank's exposure to financial instruments measured using unobservable inputs (level 3) constitutes a small component of the Group's and the Bank's portfolio of financial instruments. Changing one or more of the inputs to reasonable alternative assumptions would not change the value significantly for level 3 financial instruments. A34 Credit Transactions And Exposures With Connected Parties BANK 31 March 2021 RM'000 Outstanding credit exposures with connected parties of which: Total credit exposure which is impaired or in default Total credit exposures 31 March 2020 RM'000 329,573 11,378 206 241 48,187,666 48,581,617 Percentage of outstanding credit exposures to connected parties - as a proportion of total credit exposures 0.68% 0.02% - which is impaired or in default 0.00% 0.00% 51
52. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A35 Offsetting Financial Assets And Financial Liabilities In accordance with MFRS 132 Financial Instruments: Presentation, the Group and the Bank report financial assets and financial liabilities on a net basis on the statement of financial position, only if there is a legally enforceable right to set off the recognised amounts and there is intention to settle on a net basis, or to realise the asset and settle the liability simultaneously. The following table shows the impact of netting arrangements on: (i) all financial assets and liabilities that are reported net on the statement of financial position; and (ii) all financial assets and liabilities that are subject to enforceable master netting arrangements or similar agreements, but do not qualify for statement of financial position netting. (a) Financial assets Gross amounts of recognised financial liabilities set Gross amounts of recognised financial assets RM'000 GROUP 31 March 2021 Derivative financial assets Amounts due from clients and brokers Net amounts of financial assets off in the presented in statement of the statement financial of financial position position RM'000 RM'000 Related amounts not set off in the statement of financial position Cash Financial collateral Instruments received RM'000 RM'000 Net Amount RM'000 153,735 193,562 (88,521) 153,735 105,041 (49,769) - (27,810) - 76,156 105,041 347,297 (88,521) 258,776 (49,769) (27,810) 181,197 153,735 (49,769) (27,810) 76,156 BANK 31 March 2021 Derivative financial assets 153,735 GROUP 31 March 2020 Derivative financial assets Amounts due from clients and brokers 436,910 84,014 (32,849) 436,910 51,165 (105,271) - (82,765) - 248,874 51,165 Total 520,924 (32,849) 488,075 (105,271) (82,765) 300,039 BANK 31 March 2020 Derivative financial assets 436,910 436,910 (105,271) (82,765) 248,874 - - 52
53. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) A35 Offsetting Financial Assets And Financial Liabilities (Contd.) (b) Financial liabilities Gross amounts of recognised financial liabilities RM'000 Gross amounts Net of recognised amounts financial of financial assets set liabilities off in the presented in statement of the statement financial of financial position position RM'000 RM'000 Related amounts not set off in the statement of financial position Cash Financial collateral Instruments pledged RM'000 RM'000 Net Amount RM'000 GROUP 31 March 2021 Derivative financial liabilities Amounts due to clients and brokers 149,410 151,937 (88,521) 149,410 63,416 (49,769) - (61,381) - 38,260 63,416 Total 301,347 (88,521) 212,826 (49,769) (61,381) 101,676 149,410 (49,769) (61,381) 38,260 BANK 31 March 2021 Derivative financial liabilities 149,410 GROUP 31 March 2020 Derivative financial liabilities Amounts due to clients and brokers 348,877 55,141 (32,849) 348,877 22,292 (105,271) - (136,766) - 106,840 22,292 Total 404,018 (32,849) 371,169 (105,271) (136,766) 129,132 348,877 (105,271) (136,766) 106,840 - BANK 31 March 2020 Derivative financial liabilities 348,877 - For the financial assets and liabilities subject to enforceable master netting arrangements or similar arrangements, each agreement between the Group and the Bank and the counterparty allows for net settlement of the relevant financial assets and liabilities when both elect to settle on a net basis. In the absence of such an election, financial assets and liabilities will be settled on a gross basis, however, each party to the master netting agreement or similar agreement will have the option to settle all such amounts on a net basis in the event of default of the other party. 53
54. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) PART B - Explanatory Notes Pursuant To Appendix 9B Of Bursa Securities' Listing Requirements B1 Financial Review for Financial Quarter and Financial Year to Date GROUP Net income/revenue Operating profit before allowance Operating profit after allowance Profit before taxation Profit after taxation Profit attributable to ordinary equity holders of the Bank Net income/revenue Operating profit before allowance Operating profit after allowance Profit before taxation Profit after taxation Profit attributable to ordinary equity holders of the Bank Net income/revenue Operating profit before allowance Operating profit after allowance Profit before taxation Profit after taxation Profit attributable to ordinary equity holders of the Bank 54 4th Quarter Ended 31 March 2021 RM'000 4th Quarter Ended 31 March 2020 RM'000 445,814 213,679 77,207 77,225 50,072 434,409 228,997 130,384 130,401 98,057 2.6 (6.7) (40.8) (40.8) (48.9) 50,072 98,057 (48.9) Full Year Ended 31 March 2021 RM'000 Full Year Ended 31 March 2020 RM'000 1,817,567 1,016,909 483,897 483,988 358,785 1,689,320 882,301 567,753 567,854 424,263 7.6 15.3 (14.8) (14.8) (15.4) 358,785 424,263 (15.4) 4th Quarter Ended 31 March 2021 RM'000 3rd Quarter Ended 31 December 2020 RM'000 445,814 213,679 77,207 77,225 50,072 475,699 284,520 133,991 134,011 100,457 (6.3) (24.9) (42.4) (42.4) (50.2) 50,072 100,457 (50.2) Changes % Changes % Changes %
55. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B1 Financial Review for Financial Quarter and Financial Period to Date (Contd.) BANK Net income/revenue Operating profit before allowance Operating profit after allowance Profit before taxation Profit after taxation Profit attributable to ordinary equity holders of the Bank Net income/revenue Operating profit before allowance Operating profit after allowance Profit before taxation Profit after taxation Profit attributable to ordinary equity holders of the Bank Net income/revenue Operating profit before allowance Operating profit after allowance Profit before taxation Profit after taxation Profit attributable to ordinary equity holders of the Bank 55 4th Quarter Ended 31 March 2021 RM'000 4th Quarter Ended 31 March 2020 RM'000 328,225 153,147 74,514 74,514 48,527 327,316 171,447 111,855 111,855 84,112 0.3 (10.7) (33.4) (33.4) (42.3) 48,527 84,112 (42.3) Full Year Ended 31 March 2021 RM'000 Full Year Ended 31 March 2020 RM'000 Changes % 1,579,254 962,739 643,383 643,383 536,790 1,317,635 696,406 504,609 504,609 389,138 19.9 38.2 27.5 27.5 37.9 536,790 389,138 37.9 4th Quarter Ended 31 March 2021 RM'000 3rd Quarter Ended 31 December 2020 RM'000 Changes % 328,225 153,147 74,514 580,229 430,675 352,882 (43.4) (64.4) (78.9) 74,514 48,527 352,882 321,500 (78.9) (84.9) 48,527 321,500 (84.9) Changes %
56. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B2 Review Of Performance Business Review For Financial Year Ended 31 March 2021 (“FY2021”) Profitability The Group’s net profit after taxation was RM358.8 million for the full year ended 31 March 2021. The decline was RM65.5 million or 15.4% year-on-year (“YOY”). The lower profits were largely due to higher credit cost as a result of provisioning, mostly in the consumer portfolio. Nevertheless, pre-provision operating profit (“PPOP”) was up by 15.3%, mainly driven by net financing income growth, lower cost of funds and tighter cost management. Net income improved by RM128.2 million or 7.6% YOY. Net interest margin (“NIM”) came in lower at 2.30%, mainly due to Overnight Policy Rate (“OPR”) cuts. Loans Grew Marginally Gross loans and advances stood at RM44.1 billion, recording an increase of 1.1% YOY driven by the small and medium enterprise (“SME”) and consumer segments, growing by 6.4% and 0.4% respectively. Other Operating Income Continues to Improve The Group recorded other operating income of RM456.7 million, higher by RM90.9 million or 24.8% YOY despite the challenging external environment. The higher revenue came from higher treasury and investment income, helped by increases in bond prices and brokerage and wealth management income. Managing Operating Expenses Operating expenses decreased by RM6.4 million or 0.8%, mainly due to our initiatives in managing marketing, administrative and compensation costs. The cost-to-income ratio (“CIR”) decreased by 3.7% to 44.1%. The Group will continue to focus on cost-saving efforts as we navigate through the COVID-19 pandemic. Asset Quality The Group's allowance for expected credit losses on loans, advances, financing and other debts increased by RM218.5 million or 69.5% to RM533.0 million as compared to the previous financial year. Included in the allowance for expected credit losses on loans, advances, financing and other debts were reserves that the Group built up via management overlays amounting to RM312.7 million in anticipation of the impacts of COVID-19 on the economy. As a result, the Group recorded a net credit cost of 121.4 bps. We enhanced our credit risk framework in each line of business by stratifying customers according to risk levels and prioritising customer calls or visits. We also provided Payment Relief Assistance programmes to help borrowers while managing the Group’s credit risk. In addition, the Group continued to help its customers through the three-month extended moratorium for those who lost their sources of income. The Group will continue to improve its control of credit cost by refining credit policies, tightening credit underwriting and increasing collection efforts. Loan loss coverage (including regulatory reserves) was at 105.9%. Healthy Funding and Liquidity Position The Group’s customer-based funding stood at RM48.7 billion. We were able to maintain a high current account/savings account (“CASA”) ratio of 47.0%, driven by Alliance SavePlus and Alliance@Work. We will continue to grow CASA through Alliance SavePlus and garner CASA balances from businesses and their employees under the Alliance@Work channel. 56
57. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B2 Review Of Performance (Contd.) Business Review For Financial Year Ended 31 March 2021 (“FY2021”) (contd.) Healthy Funding and Liquidity Position (contd.) The Group’s customer-based funding stood at RM48.7 billion. We were able to maintain a high current account/savings account (“CASA”) ratio of 47.0%, driven by Alliance SavePlus and Alliance@Work. We will continue to grow CASA through Alliance SavePlus and garner CASA balances from businesses and their employees under the Alliance@Work channel. The Group’s liquidity coverage and loans-to-funds ratios stood at 150.0% and 84.3% respectively. The Group will continue to maintain ample liquidity ratios and ensure a sufficient liquidity buffer to mitigate any payment shocks resulting from the uncertainties caused by COVID-19. Proactive Capital Management Our conservative capital management approach resulted in the Bank maintaining a robust capital position. Our capital ratios were boosted by 1.2%, due to a transitional arrangement since December 2020 to recognize stage 1 and 2 expected credit losses as CET1. We maintained one of the strongest capital levels in the industry, with Common Equity Tier-1 (CET 1) ratio at 16.2%, Tier- 1 Capital ratio at 17.2% and total capital ratio at 21.6%. The Group will continue to prioritise capital conservation in order to support business expansion as we navigate through the COVID-19 pandemic. On 21 December 2020, Alliance Islamic Bank Berhad received a capital injection of RM200 million in the form of new ordinary shares from Alliance Bank Malaysia Berhad. The Bank has also reissued RM1.2 billion of new Tier-2 Subordinated Medium Term Notes successfully on 27 October 2020, which was utilised to fully redeem all our existing Tier-2 Subordinated Medium Term Notes. The Group declared an interim dividend of RM89.6 million for the financial year ended 31 March 2021. Performance by Business Segment and Subsidiary The Group’s business segments comprise Consumer Banking, Business Banking, Financial Markets and Investment Banking. The Group Consumer Banking segment recorded a loss before tax of RM139.7 million due to the build up of allowances for expected credit losses related to the economic impact of COVID-19 on our more vulnerable customers. Net income was higher by RM7.6 million or 1.2%. Net interest income increased by RM1.0 million while other operating income increased by RM6.6 million. Operating expenses decreased by RM4.4 million or 1.1%. Allowances for expected credit losses were higher by RM159.1 million largely due to management overlays amounting to RM240.6 million. The segment assets stood at RM22.1 billion. The Group Business Banking segment, comprising corporate, commercial and SME banking, recorded a profit before tax of RM272.8 million, which was 16.4% lower than the previous financial year. Net income increased by RM0.6 million or 0.1% YOY mainly due to higher net interest income. Operating expenses decreased by RM7.7 million or 2.5%. Allowances for expected credit losses were higher by RM61.8 million. Segment assets registered a growth of RM1.9 billion or 7.4%. Profit before tax in the Group Financial Markets segment increased by 43.2% or RM106.2 million YOY to RM352.3 million. Net income was higher by RM103.2 million or 34.2% YOY due to gains from the bond portfolio. Operating expenses decreased by RM2.6 million or 4.7% YOY. Segment assets stood at RM11.5 billion. The Investment Banking segment recorded a profit before tax of RM12.7 million due to higher brokerage income. 57
58. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B2 Review Of Performance (Contd.) Performance by Business Segment and Subsidiary (Contd.) The Islamic Banking segment which consist of Consumer Banking, Business Banking and Financial Markets, recorded a net profit after taxation of RM6.7 million, representing a decrease of RM67.5 million compared to the previous financial year due to the build up of allowances for expected credit losses related to the economic impact of COVID-19 on our more vulnerable customers. Net income was higher by RM21.4 million or 6.4%. Net profit income increased by RM28.0 million while other operating income decreased by RM6.6 million. Operating expenses increased by RM0.2 million or 0.2%. Allowances for expected credit losses were higher by RM108.8 million largely due to management overlays amounting to RM123.6 million. The total assets stood at RM14.6 billion. Current Quarter vs Previous Year Corresponding Quarter The Group’s profit after taxation of RM50.1 million for the quarter was 48.9% or RM48.0 million lower compared to the previous corresponding quarter, mainly due to higher operating expenses and credit cost. Key Quarter-on-Quarter Performance Highlights  Net income was higher by RM11.4 million or 2.6% mainly due to higher net interest income.  NIM grew by 8 bps to 2.51%.  Other operating income decreased by RM6.4 million or 6.8% due to lower treasury and investment income.  Operating expenses were higher by RM26.7 million or 13.0% mainly from personnel cost and professional fees.  Net credit cost was 30.1 bps B3 Comparison with Immediate Preceding Quarter As compared to the immediate preceding quarter, the Group’s profit after taxation of RM50.1 million for the quarter was lower by 50.2% or RM50.4 million. Key Quarter-on-Quarter Performance Highlights  Net income was lower by RM29.9 million or 6.3% mainly due to lower other operating income.  NIM was at 2.51%  Other operating income decreased by RM52.0 million or 37.2% as there was higher disposal gain from financial investment in the preceding quarter.  Operating expenses were higher by RM41.0 million or 21.4% mainly from personnel cost and professional fees.  Net credit cost was 30.1 bps 58
59. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B4 Business Outlook For FY2022 Given the ongoing impact of the COVID-19 pandemic, the Group will continue to prioritise customer engagement to address asset quality concerns. Meanwhile, it will support targeted customers that remain affected by the pandemic. The Group will also continue managing its loan portfolio with tighter credit underwriting. Notwithstanding the above, the Group will focus on growing the business via the following three key focus areas: (i) Acquiring more customers where the Group intends to scale up in its core segments of SME and Consumer Banking by enhancing and equipping relationship managers with digital tools to serve high-value customers. The Group will also focus on securing more customers via digital channels; (ii) Capitalising on our Consumer and Business Banking franchises, whereby we will focus on accelerating crossselling value propositions to our customers to increase market penetration and generate fee-based income; and (iii) Enhancing productivity and efficiencies by streamlining processes, automating through digital tools/channels, centralising functions and improving branch productivity. With these focus areas, and the Group’s continuing effort to apply prudent management practices, the Group expects to deliver sustainable returns to our shareholders while strengthening our market presence. 59
60. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B5 Profit Forecast There was no profit forecast issued by the Group and the Bank. B6 Taxation 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 GROUP - Income tax - Deferred tax - Real property gain tax - Under provision for taxation in prior financial period 122,536 (101,449) - 47,709 (15,939) - 200,992 (81,688) - 159,856 (16,488) 183 6,066 574 5,899 40 27,153 32,344 125,203 143,591 4th Quarter Ended 31 March 31 March 2021 2020 RM'000 RM'000 Financial Year Ended 31 March 31 March 2021 2020 RM'000 RM'000 BANK - Income tax - Deferred tax - Real property gain tax - Under provision for taxation in prior financial period 94,184 (74,219) - 39,614 (12,568) - 156,207 (56,277) - 122,548 (7,718) 183 6,022 697 6,663 458 25,987 27,743 106,593 115,471 The Group's effective tax rate for the fourth financial quarter and financial year ended 31 March 2021 was higher than the current statutory tax rate of 24% due to certain expenses being disallowed for tax purpose. B7 Profit/(Loss) on Sale of Unquoted Investments or Properties There was no material profit/(loss) on sale of unquoted investments or properties for the fourth financial quarter and full year ended 31 March 2021 other than in the ordinary course of business. B8 Purchase and Disposal of Quoted Securities There was no purchase or disposal of quoted securities for the fourth financial quarter and full year ended 31 March 2021 ended 31 March 2020 other than Investments held by the Group and the Bank whose activities are regulated by law relating to banking companies and are subject to supervision by Bank Negara Malaysia ("BNM"). B9 Status of Corporate Proposals There was no corporate proposal announced but not completed as at financial report date. Deposits from Customers, Deposits and Placements of Banks and Other Financial Institutions and Debts 60
61. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B10 Deposits from Customers, Deposits and Placements of Banks and Other Financial Institutions and Debts Securities GROUP 31 March 31 March 2021 2020 RM'000 RM'000 BANK 31 March 2021 RM'000 31 March 2020 RM'000 (a) Deposits from customers Fixed deposits, negotiable instruments of deposits and money market deposits: - One year or less (short term) - More than one year (medium/long term) Others 25,149,438 539,376 25,688,814 22,799,699 29,562,412 732,304 30,294,716 18,131,136 18,864,817 84,328 18,949,145 17,201,171 22,134,580 172,548 22,307,128 14,395,861 48,488,513 48,425,852 36,150,316 36,702,989 651,349 741,303 1,235,071 308,575 111,480 547,897 576,985 156,579 1,392,652 1,543,646 659,377 733,564 1,218,706 1,226,681 - 1,218,182 1,226,571 - 354,012 293,956 253,796 253,683 1,572,718 1,520,637 1,471,978 1,480,254 (b) Deposits and placements of banks and other financial institutions - One year or less (short term) - More than one year (medium/long term) (c) Subordinated obligations Tier II Subordinated Medium Term Notes (unsecured) - One year or less (short term) - More than one year (medium/long term) Additional Tier 1 Capital Securities (unsecured) - More than one year (medium/long term) 61
62. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B11 Derivative Financial Assets/(Liabilities) Derivative financial instruments measured at fair values together with their corresponding contract/notional amounts: As at 31 March 2021 GROUP/BANK Principal RM'000 As at 31 March 2020 Fair value Assets Liabilities RM'000 RM'000 Principal RM'000 Fair value Assets Liabilities RM'000 RM'000 Foreign exchange and commodity contracts Currency forwards - one year or less - over one year to three years - over three years Currency swaps - one year or less - over one year to three years - over three years Currency spots - one year or less Currency options - one year or less - over one year to three years Interest rate derivatives Interest rate swap - one year or less - over one year to three years - over three years Equity related derivatives - one year or less - over one year to three years - over three years Total derivatives assets/(liabilities) (i) 2,861,246 399,396 321,470 46,035 637 1,280 (3,795) (5,650) (3,428) 2,428,377 332,529 186,439 65,254 11,435 3,106 (14,980) (884) (304) 4,551,148 282,265 340,136 3,910 1,780 6,781 (37,962) (273) - 9,848,691 271,577 129,323 129,672 - (111,432) (7,705) (2,282) 125,653 234 (84) 40,337 146 (102) 179,982 9,061,296 271 60,928 (55) (51,247) 153,262 17,243 13,407,778 302 209,915 (131) (261) (138,081) 7,575,493 2,099,218 3,984,245 1,492,030 79,784 11,054 52,302 16,428 (50,355) (6,050) (35,587) (8,718) 9,123,080 3,505,421 3,386,675 2,230,984 102,793 7,073 45,023 50,697 (62,213) (5,117) (28,965) (28,131) 295,184 214,860 17,146,833 12,356 667 153,735 (35,606) (12,202) (149,410) 533,770 273,868 145,300 23,483,796 91,660 32,542 436,910 (114,219) (32,542) (1,822) (348,877) The Group's and the Bank's derivative are subject to credit risk, market risk and liquidity risk as follow: Credit Risk Credit risk is the risk of financial loss resulting from the failure of the counterparties to fulfil their contractual obligations to settle commitments. Exposure to credit risk may be categorised as primary or secondary. This exposure is monitored on an on-going basis against predetermined counterparty limits. As at 31 March 2021, the amount of credit risk in the Group and the Bank, measured in terms of the cost to replace the profitable contracts, was RM153,735,000 (31 March 2020: RM436,910,000). This amount will increase or decrease over the life of the contracts, mainly as a function of maturity dates and market rates or prices. 62
63. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B11 Derivative Financial Assets/(Liabilities) (Contd.) (i) The Group's and the Bank's derivative are subject to credit risk, market risk and liquidity risk as follow: (contd.) Market Risk Market Risk is the risk of loss of earnings arising from changes in interest rates, foreign exchange rates, equity prices, commodity prices and in their implied volatilities. The Group has established a framework of approved risk policies, measurement methodologies and risk limits as approved by the Group Risk Management Committee to manage market risk. Market risk arising from the trading activities is controlled via position limits, sensitivity limits and regular revaluation of positions versus market prices, where available. Liquidity Risk Liquidity risk is the inability of the Group to meet financial commitment when due. The Group's liquidity risk profile is managed using liquidity risk management strategies set in Liquidity Risk Management Policy. Liquidity Risk Measures are monitored against approved threshold by Group Assets and Liabilities Management Committee and Group Risk Management Committee. A contingency funding plan is also established by the Group as a forward-looking measure to ensure that liquidity risk can be addressed according to the degrees of key risk indicators, and which incorporates alternative funding strategies which are ready to be implemented on a timely basis to mitigate the impact of unforeseen adverse changes in liquidity in the market place. (ii) Cash Requirements of the Derivatives Cash requirements of the derivatives may arise from margin requirements to post cash collateral with counterparties as the fair value moves beyond the agreed upon threshold limits in the counterparties’ favour, or upon downgrade in the Group's and the Bank’s credit ratings. As at 31 March 2021, the Group and the Bank had posted cash collateral of RM61,381,000 (31 March 2020: RM137,766,000) on their derivative contracts. (iii) Related accounting policies Derivative financial instruments are initially recognised at fair value, which is normally zero or negligible at inception except for options and subsequently re-measured at their fair value. The fair value of options at inception is normally equivalent to the premium received (for options written) or paid (for options purchased). All derivatives are carried as assets when fair value is positive and as liabilities when fair value is negative. Changes in the fair value are recognised in the statement of comprehensive income. Interest income and expenses associated with interest rate swaps are recognised over the life of the swap agreement as a component of interest income or interest expense. (iv) There have been no changes since the end of the previous financial year in respect of the following: (a) the types of derivative financial contracts entered into and the rationale for entering into such contracts, as well as the expected benefits accruing from these contracts; (b) the risk management policies in place for mitigating and controlling the risks associated with these financial derivative contracts; and (c) the related accounting policies. The credit risk, market risk and liquidity risk associated with the derivatives and the policies in place for mitigating or controlling the risks with these derivatives are consistent with those adopted in the most recent audited annual financial statements for the financial year ended 31 March 2020. 63
64. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B12 Changes in Material Litigation The Group and the Bank do not have any material litigation which would materially and adversely affect the financial position of the Group and the Bank for the fourth financial quarter and full year ended 31 March 2021. B13 Dividend Declared On 31 May 2021, the Board of Directors declared an interim dividend of 5.79 sen per share amounting to approximately RM89,635,000 under single tier tax system, in respect of the financial year ended 31 March 2021 to be paid on 30 June 2021. The entitlement date for the interim dividend payment is on 17 June 2021. The Directors do not propose any final dividend in respect of the financial year ended 31 March 2021. B14 Earnings Per Share (a) Basic Basic earnings per share is calculated by dividing profit for the period/year attributable to Equity holders of the Bank by the weighted average number of ordinary shares in issue during the financial period/year. 4th Quarter Ended 31 March 31 March 2021 2020 Financial Year Ended 31 March 31 March 2021 2020 GROUP Net profit for the financial period/year attributable to Equity holders of the Bank (RM'000) Weighted average numbers of ordinary shares in issue ('000) Basic earnings per share (sen) 50,072 98,057 358,785 424,263 1,548,106 1,548,106 1,548,106 1,548,106 3.2 6.3 23.2 27.4 4th Quarter Ended 31 March 31 March 2021 2020 Financial Year Ended 31 March 31 March 2021 2020 BANK Net profit for the financial period/year attributable to Equity holders of the Bank (RM'000) Weighted average numbers of ordinary shares in issue ('000) Basic earnings per share (sen) 64 48,527 84,112 536,790 389,138 1,548,106 1,548,106 1,548,106 1,548,106 3.1 5.4 34.7 25.1
65. ALLIANCE BANK MALAYSIA BERHAD 198201008390 (88103-W) (Incorporated in Malaysia) B14 Earnings Per Share (Contd.) (b) Diluted For the purpose of calculating diluted earnings per share, the profit for the period/year attributable to Equity holders of the Bank and the weighted average number of ordinary shares in issue during the financial period have been adjusted for the dilutive effects of all potential ordinary shares, (non-cumulative). There were no dilutive potential ordinary shares outstanding as at 31 March 2021 and 31 March 2020 respectively. As a result, the dilutive earnings per share equal to basic earnings per share for financial period/year ended 31 March 2021 and 31 March 2020. By Order of the Board LEE WEI YEN (MAICSA 7001798) Group Company Secretary Kuala Lumpur 31 May 2021 65